CPC TUTORIAL CASE SUMMARY 1ST WEEK (O. 14A + )

CASE : KERAJAAN NEGERI KELANTAN v. PETROLIAM NASIONAL BERHAD &

OTHER APPEALS

FEDERAL COURT, PUTRAJAYA

SUMMARY 1. By agreements known as the Kelantan Petroleum Agreement

and the Kelantan Grant executed on 9 May 1975 between the

State Government of Kelantan (plaintiff) and Petroliam

Nasional Berhad (Petronas), a company conferred with the

rights and powers as spelt out in the Petroleum Development

Act 1974 (PDA), the plaintiff and Petronas agreed that:

(i) Petronas would have exclusive, perpetual and

irrevocable right to explore for and exploit petroleum

lying in the offshore of the State of Kelantan; and

(ii) Petronas would make cash payments to the plaintiff in

the form of a yearly sum amounting to 5% of the value

of petroleum won and saved thereof.

2. It was not in dispute that the Kelantan Grant was executed in

the form provided by the Schedule to ss. 2 and 4 of the PDA,

and indeed represented the Vesting Deed so referred to in the

Act.

3. The plaintiff alleged that Petronas has failed to make the cash

payments as promised, and in the event, averring breach of

contract, unfair discrimination, constitutional breach and

estoppel, claimed for specific performance of the agreements.

4. The facts also showed that, pursuant to the suit, the Government

of Malaysia, who claimed to have exclusive rights to all

petroleum won by Petronas in the continental shelf off the coast

of Kelantan, successfully applied for leave to intervene and was

named the second defendant in the suit.

5. Be that as it may, on 10 February 2011, the plaintiff served a

notice on Petronas to produce documents which they alleged

were relevant to their claim and to the issue of Petronas liability

under the agreements. These include the agreements and grants

as executed between Petronas and other State Governments

under the PDA, documents pertaining to areas of petroleum won

and obtained offshore Kelantan, production-sharing agreements

as executed by Petronas with contractors in respect of

Kelantans petroleum production areas, documents on the

production and payments made between Malaysia and Thailand

relating to the Malaysia-Thailand Joint Authority and accounts

of royalty payments as was paid by Petronas to the Federal

Government in respect of petroleum production areas for the

states of Kelantan, Sabah, Sarawak and Terengganu

respectively.

6. Petronas did not however oblige, and the plaintiff hence filed an

application for discovery of the documents under O. 24 Rules

of the High Court 1980 (RHC). In retort, Petronas and the

second defendant thereafter by separate applications applied to

the High Court for the disputes to be resolved by way of

determination of certain questions of law pursuant to O. 14A

and/ or O. 33 r. 2 of the RHC.

7. On 7 October 2011, the High Court dismissed the plaintiffs

discovery application on the grounds that the documents sought

to be disclosed were either not determinative of Petronass

liability under the agreements, not relevant to the core issue of

whether the plaintiff was entitled to petroleum won in the

continental shelf off the coast of Kelantan, or not in the

possession or control of Petronas.

8. The learned judge then went on to hear the O. 14A applications

and, on 18 January 2012, allowed the same. It was the view of

the learned judge, upon the authority of the Court of Appeal in

Petroleum Nasional Bhd v. Kerajaan Negeri Terengganu, that

the determination of the core issue aforesaid could be deduced

merely from the construction of documents thereby making a

full trial unnecessary.

ISSUES The plaintiff applied for and having been granted leave to appeal

posed the following questions of law for the determination of the

Federal Court, namely:

(i) whether, the applicable test for an O. 14A application as

propounded in the Terengganu case still applies;

(ii) Whether the O. 14A procedure as adopted by the courts below

was (in)appropriate; and

(iii)Whether the courts below were correct in relying on O. 24 rr. 4

and 8 of the RHC when dismissing the discovery application at

that stage of the proceeding, and in any case, whether the O.

14A applications should only be determined after the parties had

completed discovery of the documents.

ARGUMENT FOR

P AND D

APPELLANT/ PLAINTIFF

The plaintiff claimed that the defendant has failed to give consideration

and also the obligations pursuant PDA and related documents. Among

them, Petronas has failed to provide a description of the activities to

find petroleum and petroleum production from the offshore Kelantan.

Kelantan also stated that Petronas has failed to make cash payments for

petroleum offshore obtained in Kelantan. The plaintiff's claim is made

on the basis of the following, namely Petronas has breached the

agreement in Clause 8 and Clause 13 of the Federal Constitution,

discrimination is unfair (unfair discrimination) and estoppel. Kelantan

Government requested that the Court grant an order specific

performance and an examination of accounts and disclosure to

determine the full payment to the plaintiff on petroleum that has been

issued, obtained or possessed, and an order for all future cash payments

paid to the plaintiff pursuant to the terms of the agreement and PDA.

DEFENDANT

Legal issues brought by Petronas are:

1. Is the plaintiff entitled to petroleum obtained in basic continental

shelf as defined by the Continental Shelf Act 1966 in offshore

Kelantan before and up to the enactment of the PDA; and before

and up to the agreement dated March 22, 1975;

2. Whether the plaintiff put any rights to the petroleum obtained in

the continent as the agreement dated 22 Mac1975;

3. Whether the plaintiff is entitled to payment under section 4 of the

PDA to the petroleum obtained in basic continental offshore

Kelantan;

4. Whether the doctrine of estoppel applies to the Petronas;

5. Whether the testimony by lawmakers in Parliament or any other

person involved in the drafting PDA, in terms of government

policy and / or destination PDA acceptable in terms of law in

determining the goals PDA, and if applicable the same there is

evidence to determine intent and Parliament as enshrined in the

provisions of the PDA.

The Malaysian government also raised the question same like Petronas.

ANY PRINCIPLE/

TEST/

DEFINITION OF

ANY TERMS

Order 14

JUDGEMENT The appeals were dismissed by the Court of Appeal.

GROUND OF

JUDGEMENT

1. The Court of Appeal in the Terengganu case did not lay down a

hard and fast rule on the application of O. 14A. The decision in

the Terengganu case merely stated some of the relevant factors

which should be considered in dealing with an application under

O. 14A and they are not meant to be exhaustive.

2. The position of the law in an O. 14A application is that, where

there were serious disputes of facts involved, it is inappropriate

and unsuitable to have recourse to an O. 14A procedure. In

contrast, the Court of Appeal in the Terengganu case, after

scrutinising the pleadings, concluded that the issues raised were

purely legal issues based on the construction of documents

which are suitable to be determined by the O. 14A procedure.

3. In this case, the core issue as per the pleadings which was based

on the breach of contract cause of action is whether the plaintiff

has any rights over petroleum won and saved in the continental

shelf off its coast. This core issue has been sufficiently

addressed in the proposed questions or issues of law pursuant to

O. 14A, and it is clear that the outcome of the plaintiffs claim

rested entirely on the determination of this core issue. Such

determination, further, will be decisive as to the plaintiffs other

causes of action (unfair discrimination, constitutional breaches

and estoppel) considering that they are grounded on the

underlying presumption that the plaintiff has the rights over

petroleum located in the continental shelf off its coast.

4. The plaintiffs case with regards to its rights over petroleum

won and saved in the continental shelf off its coast is based on

the Kelantan Petroleum Agreement and the Kelantan Grant

which were entered pursuant to the provisions of the PDA.

Clearly, this was a question of law which could be resolved by

reference and interpretation of the relevant legislations and

contractual documentations without having to go for a full trial

of the action. It is trite that where the question of construction

is a dominant feature of a case, the court should proceed to

determine that issue and it is sufficient if substantial matters

thereof can be disposed of. In the present case, the pleadings

have made reference to various legislations which were

comprehensive and sufficient for the determination of the legal

questions involved, to the exclusion of the oral evidence of

witnesses. The construction of these agreements did not require

the testimony of witnesses as the terms of the agreement were a

mandatory reflection of the statutory provisions of the PDA

where effect must be given to such provisions.

5. The main concern here was the exercise of the discretion of the

learned High Court Judge in making the order that the action

proceeded by way of O. 14A, as later confirmed by the Court of

Appeal. The issue for this courts consideration was therefore

whether the High Court and the Court of Appeal decided the

matter correctly and in accordance with the principles for such

exercise.

6. The learned High Court Judge had considered the material facts

before her as disclosed in the pleadings. The learned judge also

noted the similarities of the arguments raised before her with

that of the Terengganu case, and had substantially relied on the

reasoning of the Court of Appeal in that case, and further, had

correctly identified the differences in the application of facts

between the two cases before concluding that this was a proper

case to be determined under O. 14A. There was no error or

misdirection whether in the application of principle or in law on

the part of the learned judge. There was no reason or

justification for this courts interference, and consequently the

second question posed was answered in the negative.

7. As for the discovery issue in the first appeal, the documents

sought were not only very extensive, but irrelevant to the core

issue. The documents sought only relate to the issue of quantum

of damages and went nowhere towards establishing the issue of

liability in the case. In the circumstances, in view of the O. 14A

applications herein, the learned judge was correct in holding

that discovery was not necessary at that stage of the

proceedings. The learned judges decision in dismissing

discovery at that stage of proceedings was in line with the

underlying principle under O. 24 r. 4 which underscored that the

discovery process was predicated on the issues involved in a

particular case. It followed that, in this case, the determination

of the core issue in the O. 14A applications had rightly been

decided to precede the discovery. It followed further that the

exercise of discretion by the learned judge in the matter was in

accordance with principles which did not justify this courts

interference.

PETROLEUM NASIONAL BHD V. KERAJAAN NEGERI TERENGGANU &

ANOTHER APPEAL

[2003] 4 CLJ 337

MOHD NOOR AHMAD, RICHARD MALANJUM AND HASHIM YUSOFF JJCA

CIVIL APPEAL NOS W-01-62 OF 2002 AND W-01-65 OF 2002

SUMMARY OF

FACTS

1. On 22 July 1975, the Government of the State of Terengganu (the

plaintiff), by the then Menteri Besar, signed a vesting instrument, vesting

on the first defendant the ownership, rights, powers, liberties and

privileges of exploring, exploiting, winning and obtaining petroleum.

2. On the same date an agreement was entered into by both parties whereby

it was agreed that in consideration of the vesting instrument, the first

defendant shall make payments in the form of a yearly sum amounting to

the equivalent of 5% of the value of petroleum won and saved in the State

of Terengganu and sold by the first defendant, its agent or contractors.

3. Accordingly payments were made until March 2000 when the first

defendant ceased to make such payment. The plaintiff brought this action

against both the defendants based on several causes of action as set out in

its statement of claim wherein the plaintiff sought several reliefs.

4. After the close of the pleadings, the first and second defendants filed

summons in chambers (SIC) seeking leave of the court for the

determination of several preliminary issues of law under O 14A and O33

of the Rules of the High Court 1980.

ISSUES

1. The question before the court was whether the issues of both facts and law

arising in the instant case could be appropriately dealt with under O 14A

and O33 R2 of the RHC.

DEFENDANTS

ARGUMENT

Defendants contended that the court is perfectly able to elucidate the provisions

of the constitutions, agreements, statutes and conventions without the aid of

extrinsic or oral evidence. It is the defendants contention that these questions or

issues if determined one way or the other will be decisive of the matter before the

court.

PLAINTIFFS

ARGUMENT

The plaintiff strenuously resisted the defendants application. Myriad question of

law fall for determination. They include novel and difficult legal questions. Such

questions cannot be answered in isolation or in a vacuum; they can only be

properly determined after evidence, both documentary and viva voce, are adduced

and facts emerge at trial. Hence, it is vital for the factual matrix to evolve and

develop before an attempt is made to determine legal questions.

JUDGMENT

Held, allowing the defendants' appeal with costs:

(1) The primary issue in the suit was whether the plaintiff had, at any time,

sovereign rights over petroleum in the continental shelf adjacent to the

coast of Terengganu. This primary issue was contained in the first three

questions posed in the defendants' applications. All the questions were

purely questions of law. If the answer to the first question was in the

plaintiff's favour, the answers to the second and third questions should also

be in the plaintiff's favour. Hence, the answers would be decisive of the

main or a substantive part of the suit.

Therefore, what remained to be done was the determination of liability in damages

and its assessment, if any, against the defendants since each of the defendants had

made a concession not to contest the plaintiff's claim should the questions be

answered in the plaintiff's favour. On the other hand, if the answer to the first

question was against the plaintiff, the subsequent two questions would suffer the

same fate and consequently, its action was doomed to fail because without the

said right the plaintiff had nothing to vest in the first defendant and hence, would

not be entitled to the payments under the principal agreement. Therefore, the

determination of the threshold issues as preliminary issues would be decisive of

the whole litigation or essentially the main part of the suit. This would result in a

substantial saving of time and cost as it would significantly cut down the costs

and time involved in pre-trial preparation or in connection with the trial proper.

(2) The High Court judge had merely considered the pleadings and the

submissions of the parties and concluded that this case was far from being

plain and simple because it raised a number of complex legal issues. The

High Court judge did not identify and make proper appraisal of the

material facts pleaded which were obviously undisputed or which should

not have been disputed. Had he done so he would have been able to

appreciate the facts and the magnitude of the case better and would have

arrived at an appropriate conclusion and finding. Hence, his exercise of

discretion was incorrect. In any case, even if the case appeared to be or

was complicated, it did not mean that the court must shun away from

considering the applicability of O 14A and O 33 r 2 of the RHC in relation

to the questions of law which were clear and definite.

BATO BAGI & ORS V. KERAJAAN NEGERI SARAWAK & ANOTHER APPEAL

Summary of Facts

1. Appellants in this case are natives of Sarawak and having native customary rights over

the land that they were residing.

2. Their native customary rights over the land were also extinguished. They claimed that

the extinguishment violated their rights under art. 5 and 13 of the Federal Constitution.

3. The appellants in Bato Bagi were contending that the extinguishment of their native

rights was void because it violated their fundamental rights under Article 5, 8, 13 and

153 of the Federal Constitution as well as Article 39(1) and 39(2) of the Constitution of

Sarawak.

4. They were asking the court to declare sec 5(3) and 5(4) of the Sarawak Land Code as

unconstitutional and that the extinguishment of their native customary rights was invalid

and void and alternatively they prayed for adequate compensation and damages.

5. The case proceeded under Order 14A of the Rules of High Court (RHC). The High

Court judge was of the view that the case was suitable for disposal under Order 14A

without the need for the matter to be ventilated through full trial. The Court of Appeal

affirmed the decision of High Court.

6. Both Bato Bagi and Jalang urge this court to remit the case back for a full trial with

witnesses and evidence.

Issue:

1. Whether s. 5(3) & (4) of the Sarawak Land Code relating to the extinguishment were

ultra vires art. 5 of the Federal Constitution read with art. 13 of the Federal Constitution.

2. Whether the High Court were correct in disposing of both matters by way of Order 14A

or equivalent in order to decide on the constitutionality of the impugned sections

Plaintiff Arguments Their cases should be remitted to the High Court for full

trial on the ground that O. 14A RHC 1980 was not the

proper mode of trial in determining the constitutionality

of ss. 5(3), 5(4) & 15(1) of the Code. Further, they sought

to raise issues pertaining to their loss of livelihood, their

entitlement to pre-acquisition hearings and the propriety

of the compensation awarded as no guidelines were

provided.

Defendant Arguments The matters were never pleaded and raised inthe courts

below. Further, the leave question had not been framed

with the contemplation of such issues and neither were

they decided by the courts below. The only remaining

issue is whether the native customary rights can be

extinguished via the impugned sections

Courts decision and reasoning 1. The appeal was dismissed by the Court.

2. If Bato Bagi is not happy with the compensation

offered to them, they should have asked for it to

be arbitrated. During that arbitration they could

have raised all the issues regarding eg, loss of their

Farms, burial grounds and other matters affecting

their livelihood.

3. There is no need for this case to be sent back for

trial. As it is almost over ten years have lapsed

since 1997 of their rights over the land was

extinguished vide the Land Direction

(Extinguishment of Native Customary Rights).

4. The considerations that the arbitrator could take

would be wider than if the law had provided the

guidelines. If either party is unhappy they can

always go for judicial review (see O. 53 of Rules

of the High Court 1980). If it can be shown that

the High Court had erred then they could take the

matter higher.

5. As far as ss. 5(3) and (4) of the Code are

concerned,other issues such as failure to provide

proper notice of extinguishment of such rights

were not pleaded and therefore is unfair to the

other party. To allow the appellants to reopen the

issues on the facts of this case would giving

opportunity to every party who has not pleaded his

case properly to ask the appellate court for a retrial

on new issues.

CIMB BANK BHD v. GAN TEOW HOOI & ORS

[2012] 9 CLJ

Summary of

Facts

The respondents had entered into a sale and purchase agreement

with Paragon Nova Sdn Bhd (the vendor) to purchase a vacant

land at the price of RM125,000. Concurrently, the respondents

also entered into a construction agreement with Atlaw Housing

Sdn Bhd (the contractor) to build a two and a half storey

house on the vacant land at the price of RM200,000 which was

to be paid in accordance with the third schedule of the

construction agreement. The respondents applied for a housing

loan in the sum of RM280,000 and this was approved by the

appellant. The agreement stipulated that RM100,000 was to be

released to the vendor for the purchase of vacant land while

RM180,000 was for the building or construction price to the

contractor. A loan agreement between the appellant and the

respondents was executed and the loan sum of RM 100,000 was

released to the vendor for the purchase of vacant land while the

balance sum of RM180,000 was released to the contractor,

pursuant to cl. 2 of the Third Schedule of the construction

agreement. Since there was no notice of completion of work sent to the

appellant, the sum of RM180,000 was not released to the

contractor. The respondents defaulted in the repayment of the

loan as stipulated in an express term of the loan agreement and

several notices of demand were issued to the respondents. The respondents

lodged a police report against the vendor and contractor, on the basis that

they did not have license

as housing developer. The Local Government and Housing Ministry issued

a letter informing them they are in the process of investigating the said

project. The appellant subsequently sent a notice of demand claiming for

the total loan amount which was released to the respondents inclusive of the

accrued interest. However no payment was made by them. The

appellant then filed the writ of summons against the respondents.

Issue(s) Whether sale and purchase agreement and construction agreement void ab

initio.

Order and

Rules

Order 14A

Plaintiffs

Arguments

It was the appellants case that firstly it was never a contracting party to

those agreements. The duty to verify the legality of the two agreements was

therefore not imposed on the appellant either by statute or under the loan

agreement.

In any case, it was the appellants contention that the loan

agreement entered into between the appellant and respondents is

lawful and enforceable since it is not a prohibited transaction

under s. 24 of the Contracts Act 1950.

Defendants

Arguments

It is the respondents case that both the sale and purchase

agreement and construction agreement were void ab initio since

the vendor/contractor do not have licence as housing developer.

The appellant was under a duty to verify the legality of the sale and purchase

agreement and construction agreement. It is also the respondents position

that the loan agreement is void and was therefore not enforceable against

them.

Courts

Decision

The court allows the appeal.

The said loan agreement was valid even if

the sale and purchase agreement and construction agreement

was illegal and void. Even if there was non-compliance with

the Housing Development (Control and Licensing) Act 1966

for failing to obtain the required license as housing developer,

it would not render the sale and purchase agreement and or

the construction agreement as null and void. The loan sum had been released

at the respondents request and at all material times, there was no instruction

from the respondent borrowers to stop the progressive release of the loan.

Relying on such representation by the respondents, the appellant was under

no duty to further verify the legality of the sale and purchase agreement and

construction agreement. The principle of estopped applies. The respondents

did not take either of these courses of action, and as such, must be

deemed to have affirmed the legality of the agreements. In any

case too, it would be unjust and inequitable to allow the

respondents to raise the issue of illegality after seven of years

the sale and purchase agreement and construction agreement

having been executed.

PENTADBIR TANAH DAERAH, PONTIAN & ORS V OSSONS VENTURES SDN

BHD

CASE SUMMARY P is the registered proprietor of two lots of land and has

granted power of attorney to a company called Pedoman

Gading to act as Ps attorney.

Pursuant to Pedoman Gadings application, D issued a

letter dated 6th August 1998 to convey the State Councils

approval for the lands to be surrendered and re-alienated to

Pedoman Gading for 99 years.

Pedoman Gading failed to complete the sale and purchase

agreement and on 30th November 2000, P terminated the

sale and purchase agreement with Pedoman Gading.

Subsequently, D refused to acknowledge the

abovementioned approval and instead in 2002 D acquired

both lands from P.

For acquisition of both lands, D paid a sum of RM615,528.

P is dissatisfied with the amount compensation and filed

his action on 5th February 2003 and applied for a

declaration under O14A of Rules of High Court with

respect to the letter dated 6th August 1998.

High Court granted Ps application.

D appeal to the Court of Appeal.

ISSUE Whether or not the declaratory order which extended the lease 99

years was contrary to the law and a nullity

PLAINTIFFS

ARGUMENT

(RESPONDENT)

P was the registered proprietor of the both lands which in

the declaration sought.

Thus the declaration sought was that the D had approved

Ps said lands for an extension of 99 years for development.

DEFENDANTS

ARGUMENT

(APPELLANT)

The declaration of the lease 99 years is contrary to law and

a nullity since the court lack of jurisdiction to make such

order.

DECISION Dismissing the appeal.

Though the prayers in the statement of claim did not

specifically pray for the declaration as made by the High

Court, the High Court has power to make the declaration

because O14AR2 empowers the court to make such

order or judgment as it thinks just upon the

determination of the question of construction of a

document arising in the cause or matter.

DREAM PROPERTY SDN BHD V ATLAS HOUSING SDN BHD

[2008] 2 MLJ 812

COURT OF APPEAL (PUTRAJAYA)

ZULKEFLI JCA, LOW HOP BING JCA AND ZAINUN ALI JCA

Summary of Facts

1. P agreed to sell to the D a piece of land and the D agreed to purchase the same subject

to the terms and conditions as agreed by the parties. One of the terms and conditions of

the agreement provided that, P shall be given nine months from the date of the agreement

to relocate a Chinese school built on the property ('the school') in order to hand over

vacant possession of the property to the D. It was also a term of the agreement that, from

the date the P confirms in writing that vacant possession of the property is ready to be

delivered to the D and upon inspection and confirmation by the D, the D shall have four

months to settle the balance purchase price to the P.

2. P claimed that vacant possession of the school, hence the property, was delivered to the

D on 21 November 2005. However, the D contended that vacant possession of the school

was not delivered to the D on 21 November 2005, but instead on28 February 2006. P

proceeded to file an action against the D in the court below, and in its action, P claimed

against the D, inter alia:

a) a declaration that vacant possession of the property had been delivered by P to the D

on 21 November 2005; and

b) a declaration that the D had failed to pay to P the balance purchase price and the

interest for the extended period on or before 21 May 2006, and therefore, the deposit

of 10% of the purchase price paid by the D was forfeited by P.

3. P thereafter filed an application under O 14A of the Rules of the High Court 1980 for the

court to determine the date of delivery of vacant possession of the school to the D. The

D opposed P's O 14A application, inter alia, on the ground that there was a dispute as to

the material facts which was evident from the parties' affidavits and therefore the action

was not suitable to be determined under O 14A of the RHC. It was also the D's contention

that P's O 14A application had failed to satisfy the prerequisites of O 14A of the RHC

for the action to be determined under the order. The learned judicial commissioner

decided that the issue on the date of delivery of vacant possession of the property was

suitable to be determined under O 14A of the RHC, and proceeded to allow P's O 14A

application. D appealed.

Issue:

The issue was whether the date when vacant possession was to be given to the D is a question

of fact, or was it a question of law or construction as envisaged under O 14A?

Held :

Majority dismissing the D's appeal with costs:

Appellants Arguments

(Defendant)

1. No question of law is discernible from the pleadings

and so it was not suitable for determination under O

14A.

2. The scrutiny of the pleadings reveals that material

facts are disputed and so O 14A is inapplicable,

Respondents Arguments

(Plaintiff)

1. P was not invoking the 'question of law' provisions

under O 14A, but has actually relied on the alternative

limb pertaining to 'construction of document'.

2. Ps prayer stated no doubt that the plaintiff is seeking

a construction of document. Thus it is allowed under

Order 14 A r 1(1).

Courts decision and

reasoning [Para Number or

Page Number ]

1. Ps application came within the ambit of the

'construction of document' which is expressly

provided in O 14A r 1(1) (Page 15 Para 42)

2. The affidavits filed bear testimony to the unequivocal

factual events. The court is competent to identify the

material facts pleaded and conclude that they should

not have been disputed at all or otherwise. (Page 25

Para 137)

3. Clearly the plaintiff's O 14A application was

appropriate since the question of the construction of

relevant clauses pertaining to vacant possession in the

agreement was a central feature of the dispute

between the parties

(Dissenting)

1. Ps prayer (1) it is for a determination on a question

of fact and should be determined in a full trial, not to

be determined summarily under the O 14A of the

RHC procedure.

2. No question of law framed or a specific question on

the construction of the agreement forwarded by P to

the court for consideration. This is apparent in the

plaintiff's O 14A application. (page 10 para 5)

3. The affidavits filed by the D in opposing the plaintiff's

O 14A application, clearly shown that there is a

serious dispute as to the material facts vis-a-vis the

date of delivery of vacant possession of the said

school to the D. (Page 11 para 7 )

LEKAZ CONSTRUCTIONS SDN BHD V. KOP PETROLEUM SDN BHD;

HSBC BANK MALAYSIA BHD (INTERVENER)

HIGH COURT MALAYA, KUALA LUMPUR

JAMES FOONG J

Summary of Facts

1. The defendant has entered into an agreement with Esso Production Malaysia Inc. in

respect to certain engineering works to be carried out in Terengganu.

2. The plaintiff claimed there were breaches committed by the defendant in the said

agreement. Therefore, the plaintiff served letter of demand to the defendant demanding

for rectification within 7 days from the date of the said letter. The defendant refused to

comply and a writ was served against him.

3. The defendant contended that, in the agreement under cl. 10.2, 30 days notice is

required to be given to the defendant to rectify any breach.

4. Therefore, the plaintiff appeal against the decision of the Senior Assistant Registrar in

allowing the defendants application in encl. 24, to dismiss the plaintiffs claim against

defendant by virtue of O. 14A of the Rules of High Court.

Issue:

1. Whether O. 14A of the RHC can be used to strike out the

plaintiffs claim?

Courts decision 1. The primary purpose and objective of this procedure

under O. 14A RHC is not to provide a process to strike

out pleadings or an action or defence. Instead, the

court need to determine the question of law or

construction of document before decide to dismiss the

entire cause or matter or make judgment as it think

just.

2. There is no question of law framed or a particular

question on the construction of document forwarded

to the court for consideration.

3. The appeal was allowed.

DATUK DR AWANG ADEK HUSSIN v. THE EDGE COMMUNICATIN SDN BHD &

YANG LAIN

MAHKAMAH TINGGI MALAYA, SHAH ALAM

ZALEHA YUSOF H

Summary of Facts

5. The Edge Financial Daily telah menyiarkan satu laporan prosiding Parlimen yang

mengfitnah Plaintif.

6. Defendan-defendan menegaskan bahawa memandangkan perkataan-perkataan dalam

artikel secara tidak sengaja dikaitkan dengan plaintif, maka pembetulan telah dibuat dan

dicetak serta permohonan maaf secara peribadi telah ditulis dan oleh yang demikian,

sekiranya dan setakat mana yang perlu, defendan-defendan akan bergantung kepada s.

10 Akta Fitnah 1957 bagi mitigasi atau penghapusan ganti rugi.

Issue:

1. Sama ada pergantungan defendan-defendan kepada peruntukan s. 10 Akta Fitnah

1957 adalah suatu pengakuan liability terhadap tuntutan plaintif?

2. Sama ada pergantungan defendan-defendan terhadap surat permohonan maaf kepada

plaintif dan pembetulan serta permohonan maaf yang diterbitkan dalam The Edge

Financial Daily merupakan pengakuan liability.

3. Sekiranya permohonan maaf dan pergantungan kepada s. 10 Akta Fitnah 1957 adalah

suatu pengakuan liabiliti, sama ada defendan-defendan boleh memohon

penghapusan ganti rugi di bawah s. 10 Akta Fitnah 1957 sedangkan peruntukan

tersebut hanya membenarkan pengurangan ganti rugi.

Courts decision and reasoning 4. Skop A. 14A dan A. 33 k. 2 KKMT 1980 ialah

bertujuan mempercepatkan pelupusan sesuatu

tindakan di peringkat interlokutori bagi menjimatkan

masa dan kos. Apa yang penting adalah tidak wujud

sebarang pertikaian fakta material yang memerlukan

sesuatu tindakan itu dibicarakan secara penuh.

5. Mahkamah berpendapat bahawa artikel yang

diterbitkan yang bertajuk Ascot given preference due

to its experience, says MOF oleh defendan

sememangnya fitnah. Ini kerana 2 minggu sebelum

artikel ini disiarkan, YAB Perdana Menteri telah

menyatakan pendirian lessen judi sports betting

tidak akan dikeluarkan oleh kerajaan kepada Ascot

Sports Sdn Bhd.

6. Mahkkamah turut berpendapat bahawa permohonan

maaf yang dibuat oleh defendan bahawa artikel yang

ditulis itu adalah salah dan dibuat secara cuai tanpa

usul periksa adalah merupakan satu pengakuan

liabiliti secara tidak langsung oleh defendan.

Tambahan lagi, s. 10 Akta Fitnah hanya

membenarkan pengurangan ganti rugi, bukan

penghapusan ganti rugi.

7. Membenarkan tuntutan plaintif.

THEIN HONG TECK & ORS V MOHD AFRIZAN BIN HUSAIN AND ANOTHER

APPEAL [2012] 2 MLJ 299

FEDERAL COURT (PUTRAJAYA)

RAUS SHARIF PCA, AHMAD MAAROPAND HASAN LAH FCJJ

Summary of Facts

1. The first, second, third and fifth plaintiffs were partners in a partnership known as ARCI

Enterprise while the fourth plaintiff was the administrator of the estate of a deceased

partner of the partnership.

2. First defendant's filed suit for the sum of RM6,157,121.57 owed to it by the partnership.

While this suit was still pending, the first defendant filed a creditor's petition seeking to

wind up the partnership for the very same amount of RM6,157,121.57. The court

granted the winding up order and appointed the second defendant as the liquidator of

the partnership. The plaintiffs then filed a suit to set aside the winding up order and the

appointment of the second defendant as the liquidator of the partnership. The first and

second defendants sought to strike off the plaintiffs' writ of summons and statement of

claim. The HC judge hearing the plaintiffs' suit treated the entire matter of the suit as

disposed of under O 14A of the 1980 RHC upon the determination of whether the

winding up order could be set aside by this court on the ground that it was a nullity ab

initio.

3. The HC judge set aside the winding up order and the appointment of the second

defendant as the liquidator and dismissed the application to strike off the plaintiffs' suit.

The first and second defendants appealed to the Court of Appeal against that decision,

while the plaintiffs cross-appealed to have their writ of summons and statement of claim

reinstated.

4. The Court of Appeal disagreed with the High Court judge and held that the partnership

could be wound up under Part X of the Companies Act 1965 ('the Act') by virtue of the

definition of 'unregistered company' in s 314(1) of the Act. The order with regard to O

14A was therefore set aside.

5. However, the Court of Appeal upheld the High Court judge's decision to dismiss the

first and second defendants' application to strike off the plaintiffs' suit. The Court of

Appeal also allowed the plaintiffs' cross-appeal.Plaintiff cross appeal to set aside the

winding up order and appointment of Second D as liquidator.

Issue:

1. Whether O14A suitable in determining the applicability of s 314 of the Companies Act

1965 to partnership?

2. Whether the appeal to set aside the HC judgment regarding the winding up order and

appointment of second D as liquidator can be granted?

Appalentss

Arguments

1. Plaintiffs' contention that it would be absurd for a partnership

registered under the Partnership Act 1961 ('the PA') to also be

categorized as an unregistered company pursuant to s 314 of the

Act.

2. Even if the Court of Appeal was right in holding that the

partnership was an unregistered company under s 314 of the Act,

it did not fulfill the requirement of s 314 of the Act in that it did

not comprise of more than five partners when the winding up

petition was presented.

3. Alternatively the plaintiffs submitted that even if the Court of

Appeal was right in holding that the partnership was an

unregistered company under s 314 of the Act, it did not fulfill

the requirement of s 314 of the Act in that it did not comprise of

more than five partners when the winding up petition was

presented.

Defendants

Arguments

1. seek to have the plaintiffs' writ of summons and statement of

claim struck out under O 18 r 19(1)(b) and (d) of the Rules of

the High Court 1980.

Courts decision and

reasoning

Dismissing the appeals with costs

1. This court was in agreement with the Court of Appeal's

interpretation of s 314(1) of the Act. It was found that the words

of s 314(1) of the Act were clear and unambiguous and ought to

be given their literal interpretation.

2. The provisions of the PA, in particular s 40 and 41, only dealt

with the voluntary winding up of a partnership by the partners

themselves and no other. A creditor could not make an

application under the PA to wind up a partnership. As such, s

314 of the Act was applicable in a situation where a creditor

sought a remedy against an insolvent partnership which had

more than five members. Therefore a partnership with more than

five members was an unregistered company and could be wound

up under Part X of the Act by virtue of the definition of

unregistered company ins 314(1) of the Act.

3. However, the facts of the case is not clear on whether the

partnership had only five members at the time of the

presentation of the winding up petition. In fact this issue as to

the number of members of the partnership at the material time

could only be determined in a full trial.

4. It was trite law that O 14A of the RHC could only be resorted

to if there was no dispute by the parties as to the relevant facts,

or the court concluded that the material facts were not in dispute.

In the present case there were serious disputed facts involved

and these issues of fact were interwoven with the legal issues

raised. As such, the Court of Appeal was correct in finding that

O 14A of the RHC was not suitable for the purpose of

determining the applicability of s 314 of the Act to the

partnership in the present case .Federal Court agrees with COA

with the finding that O 14A is not suitable for the purpose of

determining the applicability of s 314 of the Act to the

partnership.

Summary of Facts

1. Appellant (Savant-Asia Sdn Bhd) filed a winding up petition against the Respondent

(Sunway PMI-Pile) for the amount of debt owed.

2. Before the hearing date, the Respondent had already tendered a cheque to the appellant for

the exact amount claimed and the cheque was cleared on 11 May 1999.

3. However, on 12 May 1999, the winding up petition was published in The Star newspaper

and this consequently caused the Respondent to bring an action for libel against the Appellant

on account of advertising the petition after the debt had been fully settled.

4. The Appellant with his solicitor applied under 0. 14 and/or 0. 33 rr 2 and 5 of the RHC 1980

for the issue of absolute/qualified privilege raised in the pleading to be tries as

PRELIMINARY ISSUE.

Issue:

Whether this case is suitable for determination under O 14A of the Rules of the High Court

1980.

Appellant Arguments They contended that they were merely acting in their

course of duties to publish the said advertisement as

according to r 24 of the Company (Winding Up) Rules it

was mandatory for them to advertise the petition.

Respondent Arguments Alleged that there was malicious intent on the part of the

appellant in advertising the petition.

Courts decision and reasoning

[Para Number or Page Number ]

High Courts decision: [Para 10]

1. Dismissed the appellants applications on the ground

that since there is an allegation by the respondent of

malicious intent on the part of the appellant, which the

appellant deny (hence there is a dispute on a material

fact).

Court of Appeal:

Same decision with High Court.

Federal Court decision:

1. Leave to appeal was granted by the Federal Court on

the question [whether, where a winding up petition on

grounds of presumed insolvency under s 218(1)(e) of

the Companies Act 1965 has been filed and served on

Savant-Asia Sdn Bhd v Sunway PMI-Pile Construction Sdn Bhd [2009] 5 MLJ

754

a respondent and the respondent pays the sum stated

in the petition to the petitioner, the petitioner is

excused from advertising the petition and

surreptitiously keeps the money for himself to the

exclusion of the other creditors and subsequently

withdrawing the petition.]

2. The answer to this issue is negative since winding up

proceeding is a class action, therefore there is a need for

it to be advertised as provided in r 24 of the Rules.

3. Advertisement of the petition is a mandatory

requirement in a winding up proceeding and it cannot be

dispensed with.

4. This was a fit and proper case to be decided under O

14A of the RHC. The outcome of the claim by the

respondent rested entirely on the answer to the question

posed which purely involved the application of the facts,

which were not in dispute.

Summary of Facts

1. The Plaintiffs (Sin Hai Estate) prayed for damages against the Defendants (Lim Jit Kian)

based on defamation.

2. Pursuant to O. 14A of the RHC 1980, Defendants 1 to 19 sought, an order to determine

whether or not the words complained of were capable of bearing the meaning attributed to them

in the statement of claim, and if not, a consequential order that the Plaintiffs claim be dismissed

and judgment entered for Defendants 1 to 19.

3. The learned registrar had held that the words used in the statement of claim were not

defamatory, and pursuant to O. 14A, struck out the Plaintiffs writ and statement of claim.

4. Against that decision, the Plaintiffs appealed.

Issue:

Whether this is an appropriate case for court to invoke O. 14A Rules of the High Court 1980.

Plaintiff Arguments Plaintiffs submitted that this was not an appropriate case

for the court to invoke O. 14A as there should be a full

trial.

Defendant Arguments Defendants submitted for the suitability of disposing of

this action by way of a single issue of law as formulated

ie, can the plaintiffs rightly say that they have been

defamed by defendants 1 to 19 as stated in the plaintiffs

statement of claim. It was contended that the words

contained in the plaintiffs statement of claim were not

defamatory in the legal sense and so the very substratum

of action had collapsed.

Courts decision and reasoning

[Para Number or Page Number ]

8. Allowing the appeal, setting aside the order of the

learned registrar and reinstating the plaintiffs

writ and statement of claim.

9. The facts and circumstances as pleaded in the

plaintiffs statement of claim and the law applicable

to a particular cause of action must be given due and

careful consideration in order to determine the

question of law.

10. The actual meanings of these words in the averments

(as stated in Para 33) were in effect matters of

Sin Hai Estate Bhd & Ors v. Lim Jit Kim & Ors [2007] 7 CLJ 443

controversy which must perforce be determined after

a full trial having regard to the ingredients of

defamation and the defences thereto. The aforesaid

question formulated for defendants 1 to 19 could not

be appropriately dealt with or determined under either

O. 14A or O. 33 r. 2. There was no merit in the

application of defendants 1 to 19.

NEWACRES SDN BHD V.SRI ALAM SDN BHD [1991] 3 CLJ (REP) 321

FACT OF THE CASE

- This is an appeal against the judgment given by High Court dismissing the appellant's

application to dismiss the respondent's action commenced by Originating Summons

- The appellant in this case had applied to dismiss the respondent's action against them

on two grounds: (a)that the respondent was suing for payment of money while the

contract was being performed; (b) that the respondent had not referred the dispute

between the parties to arbitration.

ISSUES

1. Whether learned judge was wrong in dismissing the appellants objections,

purporting to act under O 18 r 19 of the Rules of the High Court 1980 because of the

delay on the part of the appellant in making the application to strike out the suit

APPELLANTS ARGUMENT

1. learned judge was wrong in dismissing the appellants objections, purporting to act

under O 18 r 19 of the Rules of the High Court 1980 because of the delay on the part

of the appellant in making the application to strike out the suit.

2. under O 18 r 19 the application should be made as early as possible and should not

be made at a very late stage, particularly at a stage when the case was ready for trial.

3. The learned judge was wrong in holding that the appellant was relying on s 6 of the

Arbitration Act 1952 (Act 93) on the question of arbitration when the learned judge

said: '...if the defendants wish to have the matter referred to arbitration they should

do so before taking any steps in the proceeding.

4. Learned counsel also complained that the learned judge was wrong in holding that

the respondent had a cause of action in fiduciary duty without regard to the true nature

of the claim of the respondent as was evident from the Originating Summons

5. The proposition advanced by learned counsel for the appellant is that a party to a

contract cannot go to court while a contract is being carried out and ask for payment

without provision in the contract for him to do so.

6. The appellant argued that the respondent is not entitled to any payment because there

is no provision for such payment in the agreement

7. Learned counsel for the appellant disputed the existence of fiduciary duties arising

out of the joint venture agreement and in fact in the appellant's statement of defence

it averred that the agreement is not a true joint venture agreement but, in substance,

a sale and purchase agreement for the sale of the said land by the respondent to the

appellant where the purchase price is to be paid. Therefore, all the complaints made

by the respondent could not be regarded as breach.

RESPONDENTS ARGUMENT

1. Respondent states that the dispute between the respondent and the appellant relates

to the implementation of the joint venture agreement by the appellant, and by reason

of the joint venture agreement and by reason of all the circumstances of the case, the

appellant is, at all material times, under a fiduciary duty to act honestly, reasonably

and fairly and in all his dealings with the respondent.

2. The respondent alleges that at all material times the appellant had acted in breach of

his fiduciary duties.

3. Where the appellant, referred to as the 'developer', undertook to develop the land

belonging to the respondent, has not been terminated, the respondent, strictly as a

matter of law, has no cause of action. In other words, the cause of action is premature

and therefore no relief in the form of payment of money can be made. There is no

termination of the contract and neither is there a breach of the contract. It is still in

force; at least in 1985 when the action was commenced by the respondent. In fact,

the parties are still going with the contract as at the present moment.

4. The respondent claimed that he had received from the appellant a sum of

$46,910,651.12. If there is any substance in learned counsel's submissions on this

question how this sum was paid in the first place must be explained aliunde and if

such payment is disputed then again oral evidence is inevitable. These issues would,

by themselves, be sufficient to constitute a cause or causes of action to justify a trial.

5. It is the respondent's case that a fiduciary relationship is established between the

appellant and the respondent when they entered into the joint venture agreement.

6. joint venturers owe to one another the duty of utmost good faith due from every

member of a partnership towards every other member as stipulated in the case of

Brian Pty Ltd v United Dominions Corp Ltd

JUDGMENT AND GROUNDS

Dismiss the application of applicant

1. There were several issues in this case which must be proved by extrinsic evidence.

As such, these are matters that ought to be tried at the trial proper and they cannot be

decided by recourse to O 33 r 2 read together with O 18 r 11 of the Rules of the High

Court 1980.

2. In this case the appellant had not objected to the recourse to the Court by the

respondent and had taken various steps in the proceedings and even agreed for the

case to be set down for trial. Even if the appellant were to apply for stay of the

proceedings in the High Court under s 6 of the Arbitration Act 1952, his application

would have failed. It is indisputable that the appellant did not object to the recourse

to court by the respondent but went along throughout, not only filing affidavits in

reply to the affidavits of the respondent when they filed the issues as ordered by High

Court but also filing the statement of defence and counterclaim. Such a conduct must,

by its very nature, amount to a waiver of the rights of the parties to go to arbitration

3. The learned judge, therefore, is perfectly right when he rejected this objection

MALAYAN BANKING BHD V. WEMBLEY INDUSTRIES HOLDINGS BD [2012] 5

CLJ 956

FACT OF THE CASE

- Plaintiffs claim is for the outstanding monies due and owing by the defendant to the

plaintiff in relation to banking facilities granted to the defendant whereby the plaintiff

defaulted PhileoAllied Bank had by letters of demand dated 10 March 1998 and 24

March 1998

- This leads to the defendant entering into a Debt Restructuring Agreement dated 15th

October 2014.

- loans from the other three banks were novated to PhileoAllied Bank and the business

of PhileoAllied Bank including the indebtedness of the defendant were duly vested

in the plaintiff (Malayan Banking) which involves a principal sum of RM125 million

-

ISSUES

2. Whether Plaintiffs claim is time-barred whereby section 6(5)(b) Limitation Act 1953

would apply

3. Whether relevant period of limitation 12 years under section 21(1) Limitation Act

1953 apply

4. Whether the Recitals (B) and (C) in question and cl. 10.1 survived the DRA that had

not been carried through and indeed had lapsed

5. Whether there was a clear and unequivocal admission acknowledgment of debt in

Recital (B) and (C) and cl. 10.1 of the DRA within the meaning of s. 26(2) Limitation

Act 1953

PLAINTIFFS ARGUMENT

1. However if the 12 year limitation period applies by virtue of s. 21(1) of the Limitation

Act 1953 because the loan is secured on a mortgage or charge, then limitation would

not have set in at all.

2. Alternatively, even if the six year limitation applies, if this court upholds the

argument of the plaintiff that there has been a fresh acknowledgement of debt by the

DRA of 15 October 2004 then limitation would only set in on 15 October 2010 and

the writ having being filed on 24 February 2009 was filed within time.

3. legal proceedings were commenced by PhileoAllied Bank against BSN Commercial

Bank ( Malaysia )

4. Furthermore, the indebtedness of the defendant was at all material times secured by

a charge over the assets, properties and undertaking of the defendant, the relevant

period of limitation is 12 years under s. 21(1) of the Limitation Act 1953. Following

s. 6(5)(b) of the said Act, the six years limitation period for actions founded on a

contract is not applicable.

5. Then there is s. 21(5) of the Limitation Act 1953 to be considered with respect to a

claim for interest for it provides that no action to recover arrears of interest payable

in respect of any sum of money secured by a mortgage or other charge shall be

brought after the expiration of six years from the date on which the interest became

due. The writ was filed on 24 February 2009 and so ordinarily the plaintiff could only

claim interest due from 24 February 2003 until 24 February 2009 and not interest

prior to 24 February 2003. As the accounts are computed on a monthly basis, it would

not be incorrect to say that interest due as at 28 February 2003 would be time-barred.

6. However a sum in excess of RM48 million was received by the plaintiff from Affin

towards reduction of the defendants indebtedness. Pursuant to cl. 13.4 of the

Supplemental Agreement the order of application of monies realised under security

documents (defined to include the debentures) is set out and such monies shall go

towards payment of interest under cl. 13.4:2 before principal under cl. 13.4:3.

7. The payment in excess of RM48 million will go towards payment of the amount of

interest and since the payment is greater than the amount of interest which would be

time-barred, this means that none of the amounts claimed herein by the plaintiff

would be time-barred in any event.

8. The position is consistent with the common law position enunciated in the rule in

Claytons case whereby

the various credits are prima facie to be treated as applied in the order in which the debits

and credits are set against each other in the account, each new credit being treated as

discharging the earliest outstanding debit

DEFENDANTS ARGUMENT

7. the plaintiffs claim was time-barred. The procedure adopted is in line with O. 33 r.

2 of the Rules of the High Court 1980 (RHC) which reads:

The Court may order any question or issue arising in a cause or matter, whether of fact or

law or partly of fact and partly of law,

and whether raised by the pleadings or otherwise, to be tried before, at or after the trial of

the cause or matter, and may give directions as to the matter in which question or issue shall

be stated.

8. Both parties agreed that ordinarily under s. 6 of the Limitation Act 1953 the cause of

action of the plaintiff would have accrued on 29 January 2000 as that was the date of

repayment in one lump sum of the loan outstanding.

9. If that was the case, limitation would have set in on 19 January 2006.

10. Learned counsel for the defendant submitted that the plaintiff had been classified as

an unsecured financier in the DRA.

11. by that time the security of the shares of the defendant had been disposed of and so

for purposes of classification of the financier in question, it is not incorrect to have

categorized the plaintiff under the rubric of unsecured financiers

12. On whether The Recitals (B) And (C) In Question And Clause 10.1 Survive The

DRA That Had Not Been Carried Through And Indeed Had Lapse; the conditions

precedent in the DRA were not fulfilled and there being no extension of time for the

defendant to comply with the conditions precedent, the plaintiff was discharged from

all its obligations to the defendant as provided under cl. 2.5 and the DRA was

terminated under cl. 2.6.

13.

JUDGMENT AND GROUNDS

Granting judgment to plaintiff

4. The defendants allegation of triable issues is not supported by contemporaneous

objections or documents at the relevant period. And the arguments raised are

misconceived taking into consideration the terms of the Debt Restructuring

Agreement, and clear admission of liability for the respective sums set out in the

Schedule. It is trite that mere allegation without supporting documents cannot stand

as triable issues. In addition the allegations raised militate against the agreed terms.

5. The defendants argument on limitation is misconceived taking into consideration

that time to commence the action under the Debt Restructuring Agreement will arise

only upon the plaintiff making the demand. The demand in the instant case was made

on 1.10.2010 and the learned judge agreed that the submission of the learned counsel

for the plaintiff that there is no question of any limitation period setting in, taking

into consideration the acknowledgment of liability as well as section 26 of the

Limitation Act 1953 and the terms agreed by the parties.

6. Even if the action has to be brought within six years of the accrual of the cause of

action, it has been brought within time because of the fresh accrual of the action on

15 October 2004 when the DRA was signed by the plaintiff and the defendant. The

writ was filed on 24 February 2009 and so filed within time.

YB Dato' Hj Muhammad bin Hj Abdul Ghani v The New Straits Times Press (M) Bhd

& Ors [2012] 8 MLJ 675

Summary of

Facts

The plaintiff's case was founded on libel. The plaintiff, a senator, relied on

the News Straits Times ('NST')

article entitled 'Senator in cloned AP scam' and the Berita Harian ('BH')

article entitled 'Syarikat Milik Senator klon AP' ('articles complained of') to

premise his claim against the defendants. The plaintiff alleged that the

articles complained of were defamatory of the plaintiff and had tarnished

his character, credibility, reputation and also the offices held by him thereby

bringing about hatred and public scandal. The plaintiff therefore claimed

against the defendants, inter alia, general damages, aggravated and/or

exemplary damages for libel, an injunction to restrain the defendant and its

agent from further publishing similar defamatory words of him. At the

outset of the trial, the defendants had urged this court to determine the

following preliminary issues:

(i)whether the articles complained of, when read in its entirety and in its

proper context referred to or was

capable of referring to the plaintiff; and

(ii) whether the articles complained of were defamatory of the plaintiff.

Issue(s) (1)Whether action could be disposed of without need of

extrinsic evidence

(2)Whether fit and appropriate case to exercise discretionary powers

Ordinance

and Rules

Ordinance 33

Rule 2

Rule 5

Plaintiffs

Arguments

It is the plaintiff's pleaded case that the articles complained of in their

ordinary meaning, impute that:

(a) the plaintiff who is a Senator, is a greedy and an irresponsible person

and is therefore not fit to

hold a public office;

(b) the plaintiff has illegally and unlawfully obtained income in the sum of

RM500,000 per month for

the past three years or more through this cloning activities;

(c) the plaintiff is running the car selling business illegally and unlawfully;

(d) the plaintiff is dishonest, a cheat and a person who is without integrity

and or a criminal; and

(e) the plaintiff has caused problems with the Government and the relevant

authorities because of

the said business.

The plaintiff further alleged that the articles complained of are defamatory

of the plaintiff and had tarnished his character, credibility, reputation and

also the offices held by him thereby bringing about hatred and public

scandal.

The plaintiff therefore is claiming against the defendants for general

damages, aggravated and or exemplary damages for libel, an injunction to

restrain the defendant and its agent from further publishing similar

defamatory words of him, interest, costs and other relief this court deems

fit.

Defendants

Arguments

It could be gleaned from the case of Ayob Saud

v TS Sambanthamurthi and numerous other established cases, in order to

succeed in a claim founded on the tort of libel the following three elements

must be proven by the plaintiff:

(a) that the articles complained of bear defamatory imputations;

(b) that the articles complained of made reference to the plaintiff;

(c) that there is publication of the articles complained of to a third party by

the defendant.

Courts

Decision

In substance, this court is only required to determine the issues of 'reference'

and 'whether the words are 'defamatory'. It is trite that this court has a wide

discretionary power to order for preliminary issues to be tried before, at or

after the trial of an action. The court of the view that this is a fit and an

appropriate case for this court to exercise its discretionary powers to dispose

of this action altogether pursuant to O 33 rr 2 and 5 of the RHC just by

reading the articles complained of without the need of extrinsic evidence.

Having considered the pleadings, the affidavits filed herein and the

arguments by the respective counsel, from each side and having given the

matter a very careful and serious consideration, I am of the view the

plaintiff's action is obviously unsustainable in law and is doomed to fail. In

view of the fact that this court could decide the first and second elements

required by the law without having to go through the normal process of a

full-blown trial and that the final issue pertaining to publication has been

admitted by the defendants and resolved herein there is nothing left to be

ventilated by this court.

Defendant's prayers allowed with costs.

PETROLEUM NASIONAL BHD V. KERAJAAN NEGERI TERENGGANU &

ANOTHER APPEAL

[2003] 4 CLJ 337

MOHD NOOR AHMAD, RICHARD MALANJUM AND HASHIM YUSOFF JJCA

CIVIL APPEAL NOS W-01-62 OF 2002 AND W-01-65 OF 2002

SUMMARY OF

FACTS

5. On 22 July 1975, the Government of the State of Terengganu (the

plaintiff), by the then Menteri Besar, signed a vesting instrument, vesting

on the first defendant the ownership, rights, powers, liberties and

privileges of exploring, exploiting, winning and obtaining petroleum.

6. On the same date an agreement was entered into by both parties whereby

it was agreed that in consideration of the vesting instrument, the first

defendant shall make payments in the form of a yearly sum amounting to

the equivalent of 5% of the value of petroleum won and saved in the State

of Terengganu and sold by the first defendant, its agent or contractors.

7. Accordingly payments were made until March 2000 when the first

defendant ceased to make such payment. The plaintiff brought this action

against both the defendants based on several causes of action as set out in

its statement of claim wherein the plaintiff sought several reliefs.

8. After the close of the pleadings, the first and second defendants filed

summons in chambers (SIC) seeking leave of the court for the

determination of several preliminary issues of law under O 14A and O33

of the Rules of the High Court 1980.

ISSUES

2. The question before the court was whether the issues of both facts and law

arising in the instant case could be appropriately dealt with under O 14A

and O33 R2 of the RHC.

DEFENDANTS

ARGUMENT

Defendants contended that the court is perfectly able to elucidate the provisions

of the constitutions, agreements, statutes and conventions without the aid of

extrinsic or oral evidence. It is the defendants contention that these questions or

issues if determined one way or the other will be decisive of the matter before the

court.

PLAINTIFFS

ARGUMENT

The plaintiff strenuously resisted the defendants application. Myriad question of

law fall for determination. They include novel and difficult legal questions. Such

questions cannot be answered in isolation or in a vacuum; they can only be

properly determined after evidence, both documentary and viva voce, are adduced

and facts emerge at trial. Hence, it is vital for the factual matrix to evolve and

develop before an attempt is made to determine legal questions.

JUDGMENT

Held, allowing the defendants' appeal with costs:

(3) The primary issue in the suit was whether the plaintiff had, at any time,

sovereign rights over petroleum in the continental shelf adjacent to the

coast of Terengganu. This primary issue was contained in the first three

questions posed in the defendants' applications. All the questions were

purely questions of law. If the answer to the first question was in the

plaintiff's favour, the answers to the second and third questions should also

be in the plaintiff's favour. Hence, the answers would be decisive of the

main or a substantive part of the suit.

Therefore, what remained to be done was the determination of liability in damages

and its assessment, if any, against the defendants since each of the defendants had

made a concession not to contest the plaintiff's claim should the questions be

answered in the plaintiff's favour. On the other hand, if the answer to the first

question was against the plaintiff, the subsequent two questions would suffer the

same fate and consequently, its action was doomed to fail because without the

said right the plaintiff had nothing to vest in the first defendant and hence, would

not be entitled to the payments under the principal agreement. Therefore, the

determination of the threshold issues as preliminary issues would be decisive of

the whole litigation or essentially the main part of the suit. This would result in a

substantial saving of time and cost as it would significantly cut down the costs

and time involved in pre-trial preparation or in connection with the trial proper.

(4) The High Court judge had merely considered the pleadings and the

submissions of the parties and concluded that this case was far from being

plain and simple because it raised a number of complex legal issues. The

High Court judge did not identify and make proper appraisal of the

material facts pleaded which were obviously undisputed or which should

not have been disputed. Had he done so he would have been able to

appreciate the facts and the magnitude of the case better and would have

arrived at an appropriate conclusion and finding. Hence, his exercise of

discretion was incorrect. In any case, even if the case appeared to be or

was complicated, it did not mean that the court must shun away from

considering the applicability of O 14A and O 33 r 2 of the RHC in relation

to the questions of law which were clear and definite.

TENAGA NASIONAL BHD V JCY HDD TECHNOLOGY SDN BHD

[2012] 3 MLJ 705

HIGH COURT (PULAU PINANG)

VARGHESE GEORGE J

Summary of Facts

1. Plaintiff conducted an inspection of the meters which recorded the consumption of

electricity at two of the defendant's premises, namely the premises at Bukit Mertajam

and at Perai, it had discovered that there had been meter tampering or interference.

2. Plaintiff made a demand on the defendant to settle back-charges for unrecorded usage

of electricity by the defendant for the period September 2007-November 2009.

3. When the defendant failed to settle the back-charges claimed, the plaintiff filed an action

against the defendant for recovery of the back-charges.

4. The defendant counterclaimed and sought a declaration that the plaintiff's claim for

back-charges for the prior 27 months was unfair and unconscionable.

5. After this action was set down for trial the defendant filed the present application for

the determination of two preliminary issues pursuant to O 33 rr 2 and 5 of the RHC

1980 on the grounds that these issues would dispose of this matter without the

necessity for a full trial.

6. The two issues raised were concerned with 1)whether the proviso to reg 11(2) of the

Licensee Regulations 1990 which limited any retrospective adjustment to a period not

exceeding three months from the date the defendant was informed it was undercharged,

and 2)plaintiff cited s 38(3) of the Electricity Supply Act 1990 and submitted that the

three months limitation in the proviso to reg 11(2) of the Regulations did not apply.

7. Objection was raised by the plaintiff as to the appropriateness of the defendant's

application for the questions to be determined as preliminary issues.

Issue:

3. Whether case suitable for determination of issue of law ?

4. Whether defendant's application appropriate at this stage of proceedings --Rules of the

High Court 1980 O 33 rr 2 & 5?

Plaintiffs

Arguments

27 months back-charges equated to the loss of revenue suffered by the

plaintiff during that period and that the defendant was liable to meet that

loss. S. 38(3) of the Electricity Supply Act 1990 put forward that

three months limitation did not apply and the plaintiff was entitled to

recover all 'revenue' that would have otherwise accrued to the plaintiff.

The plaintiff's claim arose from pengusikkan meters ('tampering').The

claim was being brought pursuant to s 38(3) of the Act and therefore

reg 11 had no place in such a context where the action was based on

alleged 'tampering' of the meters; and the defendant had at one point

expressed willingness to settle the claim for back-charges for asum of

RM3m and this should be held as an 'admission of debt' up to RM3m

by the defendant.

Defendants

Arguments

Defendant disputed that it fell under an 'error of reading' of the meters

and accordingly any recovery by the plaintiff was also limited to

unbilled usage up to three months prior to the demand to pay back-

charges.

Defendant also put forward Reg 11(2) of the Licensee Regulations

1990 limited any retrospective adjustment to a period not exceeding

three months from the date the defendant was informed it was

undercharged. Thus, Plaintiff could not claim.

Courts decision

and reasoning

1)Judgement entered for the Plaintif against defendant. Without

securing a conviction of that nature the plaintiff's claim for the recovery

of the 27 months of back-charges was not sustainable in

law. The plaintiff had not alleged in its statement of claim that the claim

was founded upon or brought pursuant to s 38(3) of the Act. There was

no averment by the plaintiff that the defendants or its servants were

responsible for the tampering of the meters at the two premises and no

police action was taken. It was trite law that a party was bound by its

pleadings. Thus, the plaintiff's claim for all intents and purposes was a

claimfor unbilled or undercharged usage of electricity per se. Plaintiff

was only allowed to claim back-charges for the two premises for the

three months prior to 11 December 2009 and not for 27 months.

2)This court found that it was appropriate to consider and determine

the two issues even at this stage of the proceedings. Application under

O 33 r 2 of the RHC 1980, which was in the genre of procedures open

to the court to expeditiously make a determination and that would have

the effect of substantially disposing the matter before the court, could

be made at any stage of the proceedings. The salient facts of the present

case were not in serious dispute or controversy and judge was

convinced he would arrive at the same conclusion given a full trial.

The defendant's counterclaim be struck out.There shall be judgment

entered for the plaintiff against the defendant for:

(i) The total sum of RM1,048,369.20, and

(ii) Interest thereon at the rate of 4% pa from date of judgment until full

settlement.

The defendant to pay the plaintiff costs of RM15,000 overall for this

proceedings

ANNE LIM KENG SEE

v.

THE NEW STRAITS TIMES PRESS (M) BHD & ANOR AND OTHER APPEALS

FACT OF THE CASE

- The Appellant claimed that the advertisement that was published in the Malay Mail

was defamatory to her as it was not true and false. The advertisement acted as notice

of substituted service of a bankruptcy notice that was referred to the Appellant and

was published in 22 January 2001. Appellant stated that she had already settled the

debt for sum Rm8, 658 with 22% interest per annum and sum of RM450 however

the respondent was unaware of it. Because of that, the Appellant demanded an

apology from the Respondent. There was no action taken by the respondent therefore

the Appellant filed a defamatory suit against the Respondent.

- The appellant obtained judgment in default of appearance against the Malay Mail.

The 1st respondent applied to set aside the said judgment and the application was

allowed. However the appellant stated that since the default judgment was made

against the 2nd defendant the application to set it aside should be made by the 2nd

defendant not the 1st Respondent.

- The 1st respondent on the other hand filed an application to strike out the Malay Mail

as a party pursuant to O. 18 r. 19(1)(b), (c) and (d) of the Rules of the High Court

1980 and had also filed an application pursuant to O. 33 r. 2 of the Rules praying for

an order that the following preliminary issue be tried before the trial of this action.

ISSUES

6. Whether O. 33 r. 2 of the Rules is an appropriate procedure to be used in defamation

suits.

APPELLANTS ARGUMENT

9. The said advertisement in the Malay Mail Newspaper contained words which are

defamatory to her.

10. A newspaper is a person and to support this contention referred to s. 3 of the

Interpretation Acts 1948 and 1967 (Act 388) which provides that the word person

includes a body of persons, corporate or unincorporated.

11. 1st defendant does not have the locus standi to step into the shoes of the Malay Mail

and hence would not be in a position to apply to set aside the judgment in default.

12. Applications made under O. 33 R. 2 is not a suitable method to dispose of a

defamation suit by way of determining a preliminary issue as the issues are complex

and thus the matter should go for full trial.

RESPONDENTS ARGUMENT

14. The Malay Mail is not itself a separate legal and/or corporate entity and as such

denies that the name Malay Mail can be sued and hence reserves its rights to apply

for the name Malay Mail to be struck out from these proceedings.

15. The publication of the said advertisement was pursuant to an order for substituted

service made by the Kuala Lumpur High Court.

16. This is one of the occasions when the facts and issue are eminently suitable for

disposal pursuant to O. 33 r. 2 of the Rules. He argued that s. 12(1) of the Act was

created specifically to, inter alia, protect a newspaper from libel actions where the

newspaper was merely publishing notices or advertisements in accordance with an

order of court and that once the court finds that a defendant is entitled to rely on s.

12(1) of the Act and in the absence of express malice, the court should be able to

dispose of the action by way of a determination of a preliminary issue, rather than

have the matter proceed to full trial which would lead to delay and additional costs.

HELD AND GROUNDS

Dismissed the Appellants application with costs.

7. The Malay Mail is not a legal entity. It is but a newspaper product which is owned

and published by the 1st respondent and the name Malay Mail is not the name

under which the 1st Respondent carries on its business. [page 714]

8. Thus, we are of the view that the judgment in default obtained against the Malay Mail

is a nullity. The Malay Mail is not a legal entity on the date the writ was issued and

is not even a name under which the 1st respondent is carrying on its business. As

such the learned judge was clearly entitled to set aside the judgment in default

obtained against the Malay Mail and consequently striking it out as a party.

9. The 1st respondent has the locus standi and is the correct party to make the

application to set aside the judgment in default obtained against the Malay Mail.

10. We do not think that under such circumstances, a mere reproduction by the 1st

respondent of a notice of substituted service in the Malay Mail upon a payment of a

fee or a service charge can be said to be mala fide. The objective of the said

advertisement is inform the appellant that bankruptcy proceedings have been

instituted against her and that upon its publication in the Malay Mail, the effect in

law is that the bankruptcy notice have been duly served upon her. As such, we cannot

see how it can be argued that there was malice on the part of the 1st respondent.

11. It is our view that the instant appeal is clearly a case where the determination of the

question posed would substantially dispose of the whole action. The trial of the

preliminary issue has resulted in a substantial saving of time and expenditure in

respect of the trial of the action as a whole. We cannot see why advantage should not

be taken of such a facility as provided under O. 33 r. 2 of the Rules.

12. The preliminary point raised was not a complex issue which requires the matter to go

for full trial. It was clearly not based on hypothetical facts. It dealt with a single point

of law which, after having been decided in favour of the 1st respondent, was decisive

and has disposed of the entire litigation. The appellant failed to show any spite or ill-

will directed from the 1st respondent to her goodself or even any indirect motive. The

publication of the said advertisement was absolutely privileged and as such, we are

of the view that the learned judge was correct in dismissing the suit as the

determination of the question posed in the affirmative has substantially dispose of

the whole action.

KRISHNAN RAJAN N KRISHNAN v BANK NEGARA MALAYSIA & ORS

[2003] 1 MLJ

SUMMARY OF

FACTS

The plaintiff applied in encl. 16 for a question raised in the pleadings of

this civil suit to be tried on a preliminary basis under O. 33 r. 2 of the

Rules of the High Court 1980 (RHC). This civil suit involved issues

of defamation and negligence. Enclosure 16 was made on the grounds

that it would save considerable time and costs. The question posed, inter

alia, was whether the Biro Maklumat Cek Operational Framework and

Reporting Guidelines (BMC Guidelines) issued by the first defendant

were ultra vires the Central Bank of Malaysia Act 1958. The first

defendant had blacklisted the plaintiff under the said guidelines as a bad

cheque offender. The plaintiff claimed that the first defendant should

not carry out a compulsory blacklisting of an account holder let alone

an innocent member of the public who was not an account holder of the

complainant bank like the plaintiff herein. Further, that all the licensed

banks were compelled to follow the directions of the first defendant by

blacklisting an account holder on a global basis and this was wrong and

clearly unauthorised by the statutes. The first defendant submitted that

as to whether the BMC guidelines were valid or otherwise would not

substantially dispose of the plaintiffs claim in defamation and the other

defences pleaded by the defendants. As such, the court should not

invoke its discretionary powers under O. 33 r. 2 RHC as it would not

result in substantial saving of time and costs.

ISSUES Whether the issue is triable under O 33 r 2 RHC ?

PLAINTIFFS

ARGUMENT

1. The application in encl. 16 is not only appropriate but it is also

within the contemplation of Order 33 r. 2 of the RHC and it is

because of this that he says that the application should be dealt

with an advance.

2. That the application is encl. 16 can be disposed of quickly and

simply as it is purely a question of law.

3. That the issue involved is quite obvious and that there is no

lengthy and tedious arguments to pursue and it can simply and

quickly be determined by the court and

4. That it is a singular point of law of general importance which

has hitherto affected a diverse cross section of the public and that

it can be argued and concluded without any reference to and

quite independent of the evidence or to the facts of the matter at

hand.

DEFENDANTS

ARGUMENT

1. On be