IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR
(COMMERCIAL DIVISION)
SUIT NO. D1-22-447-2008
BETWEEN
PREVINDRAN SATHURGASINGHE
(I/C NO. 701223-06-5197)
(TRADING UNDER THE NAME AND STYLE OF ‘ZERIN PROPERTIES’)
…
(REGISTERED NO: E(3)0739)
PLAINTIFF
AND
FABER GROUP BERHAD
… DEFENDANT
(Company No : 5067-M)
GROUNDS OF DECISION
1
Introduction
1.
The plaintiff is the sole proprietor of Zerin Properties whose business
is real estate agency under the name of “Zerin Properties” (“Zerin”) which is
registered with the Board of Valuers, Assessors and Property Agents,
Malaysia.
2.
The
plaintiff
claims
against
the
defendant
for
a
sum
of
RM3,359,538.00 including 5% tax, interest and costs for services rendered
as an agent of the defendant in respect of the sale of Sheraton Hotel Hanoi
(“Hotel”) to Berjaya Corporation Berhad Group of Companies (“Berjaya”).
3.
The defendant denies that the plaintiff has been appointed as agent
to sell the Hotel to Berjaya.
The defendant however contend that the
plaintiff was appointed only in respect of the proposed sale of the Hotel to a
company known as Kingdom Hotels Investment (“KHI”) and that it is not an
‘open’ appointment such as to contractually binds the defendant as its
agents with respect to the Hotel.
2
Agreed Facts
4.
The defendant is a group holding company and FHH and the
defendant’s group of companies which also includes Faber Hotel Holdings,
Faber Facilities Sdn Bhd (“FFSB”), Faber Medi Serve Sdn Bhd dan Faber
Development Sdn Bhd.
5.
FHH wholly owns Faber Labuan Sdn Bhd (“FL”), which at the material
time owned 70% shares in a joint venture company known as Vimas Joint
Venture Company Limited (“Vimas”) that owns the Hotel. FL’s local JVCO
partner in Vimas was Hotay Company Limited (“Hotay”).
6.
Around March 2006, the plaintiff introduced KHI to the Hotel. KHI
was interested to buy the Hotel and consequently, KHI was introduced to
the defendant whereby negotiation proceeded between KHI and the
defendant through the plaintiff.
7.
In March 2007, the plaintiff introduced the Hotel to Berjaya. Berjaya
made their first offer (together with earnest deposit) on 16.5.2007 to the
defendant through the offices of the plaintiff (“the first offer”). However vide
3
letter dated 28.5.2007, the defendant rejected the first offer and return
Berjaya’s earnest deposit.
Subsequently, on 6.6.2007 Berjaya made a
second offer of USD49,000,000.00 for Vimas Joint Venture Company
Limited (“the second offer”).
8.
The negotiation between KHI and the defendant lapsed around
19.6.2007.
9.
On 3.9.2007, the plaintiff received an email from CIMB on the
exercise tender proposed for the Hotel (“the tender”). The exercise was
conducted by way of private tender without any advertisement whereby
CIMB directly invited the same parties that had previously made offers to
the defendant for the Hotel (including KHI and Berjaya), to bid at the
tender. Pursuant to the tender, Berjaya successfully bid for the Hotel for
USD68.22M (or RM228.54M).
10.
The defendant received letters dated 19.6.2007 (pg 268 of Bundle B),
20.7.2007 (pg 280 of Bundle B) and 25.7.2007 (pg 281 of bundle B) from
the plaintiff.
4
The plaintiff’s case
11.
The plaintiff, PW1 testified that in late 2002 it was industry knowledge
that FHH was selling its hotels or causing the sale of the hotels in the Faber
Group including the Sheraton and Merlin hotels in Malaysia and FHH’s
interest in the Sheraton Hotel in Hanoi, Vietnam (“the said interest”). At all
material times, FHH on behalf of the defendant’s group proposed to sell
their Sheraton and Merlin Hotels in Malaysia (including Sheraton Imperial
KL) as well as the Hotel.
12.
Evidence was lead through PW1 that Encik Mohd Nadzir bin Che
Omar (PW2), the then General Manager of FSB introduced him to Encik
Amir bin Abdul Rahman (“Amir”), the then Group General Manager of FHH.
PW2 arranged a meeting on 23.1.2002 at Amir’s office during which Amir
discussed FHH’s intention to sell the said hotels and the prospect of PW1
being made agent to secure purchasers for the same.
After the said
meeting, Amir issued a letter dated 23.1.2002 (pg 174-175 of Bundle B)
listing all the said hotels and their respective reserved prices (“the list”).
The list includes the Hotels as well as the Sheraton Imperial KL.
5
13.
Vide a letter dated 2.8.2002 (pg 176 of Bundle B) (the appointment
letter) the defendant informed the plaintiff ‘to act as agent in securing the
purchase for properties held under Faber, by any parties whereby a certain
commission would be payable to the plaintiff upon successful conclusion of
the sale.
14.
The letter found at pg 176 of Bundle B forms an integral part of the
plaintiff’s case. He places considerable reliance on the defendant’s letter
dated 2.8.2002 in support of his claim as to fees.
15.
Vide a letter dated 13.9.2004 the defendant appointed from the
defendant appointing Zerin as ‘exclusive property agent for the asset
disposal programme under FGB’s proposed restructuring schem (“the
exclusive appointment”).
16.
Around 14.3.2006, the plaintiff introduced KHI to the Hotel and the
Site. KHI was keen to buy the Hotel and consequently, KHI was introduced
to the defendant whereby several offers to buy the Hotel were made by KHI
to the plaintiff through the offices of Zerin.
6
17.
PW1 states that subsequently in early March 2007, PW2 arranged a
meeting with Dato’ Anuar bin Aji (“Dato’ Anuar”), the Non-Executive
Chairman of the defendant at the material time and the plaintiff in the Faber
Towers building (“the March meeting”). During the March meeting, Dato’
Anuar asked why the discussions with KHI to sell the Hotel were not
materializing after KHI made their first offer. Dato’ Anuar also asked the
plaintiff to revive the KHI offer and look for other buyers for the Hotel.
18.
In March 2007, the plaintiff introduced Berjaya to the Hotel.
19.
In mid May 2007 (“the May meeting”), the plaintiff met Dato’ Anuar
and PW2 again whereby the PW1 stated that Berjaya were keen to buy the
Hotel. Subsequently, Berjaya’s Chief Executive Officer Tan Sri Vincent Tan
called Dato’ Anuar directly to discuss the purchase of the Hotel.
20.
On 16.5.2007, Berjaya made their first offer (together with earnest
deposit) to the defendant on 16.5.2007 through the offices of the plaintiff
(“the first offer”).
At the same time, the plaintiff issued a letter dated
16.5.2007 (pg 229-230 of Bundle B) to the defendant confirming the
introduction and setting out the fee structure after the agreed discount ie.
7
1.4% of the successful transacted sale and purchase price plus 5%
government service tax all payable when the Sale & Purchase Agreement
become unconditional (“the Berjaya introduction letter”).
In cross-
examination, the plaintiff agreed that the defendant did not acknowledge
approval of his letter.
21.
Around 28/05/07 the defendant rejected the first offer through the
plaintiff and returns the Berjaya’s earnest deposit.
22.
Subsequently, through Zerin, on 6.6.2007 Berjaya made a second
offer of USD49,000,000.00 for the Interest (“the second offer”) (pg 258-260
of Bundle B).
23.
Vide a letter dated 25.7.2007, Zerin reminded the defendant that the
plaintiff had introduced both KHI and Berjaya to them and that they are
both committed to the proposed sale. The plaintiff also stated that should
either KHI or Berjaya enter into a contract to purchase the Interest, the
plaintiff would be entitled to a commission in accordance with the new fee
structure.
8
24.
Around 20.7.2007, the defendant made known that they would sell
the Hotel through a tender exercise to be conducted by CIMB (“the tender”
and “CIMB” respectively). The plaintiff also informed the defendant that
notwithstanding the appointment of CIMB, the plaintiff would be entitled to
the commission.
The defendant did not respond to these letters until
13.8.2007.
25.
The tender exercise was conducted by way of private tender whereby
CIMB directly invited the same parties that had previously made offers to
the defendant for the the sale of the Hotel (including KHI and Berjaya), to
bid at the tender.
26.
Pursuant to the tender, Berjaya successfully bid for the Hotel for
USD68.22M (or RM228.54M) (“the third offer”).
27.
Vide its solicitors M/s Norendra & Yap’s (“N&Y”) letter dated
18.12.2007, the plaintiff put the defendant on notice of the plaintiff’s right to
claim the commission as soon as the sale was concluded. Subsequently
N&Y issued further letters dated 7.1.2008, 15.2.2008 and 21.2.2008 to the
defendant and their solicitors, M/s Cheang & Ariff (“C&A”) claiming, inter9
alia, the commission on the basis of the third offer. N&Y also stated that
CIMB had no right in law to conduct the tender as it involved real property
and therefore was in contravention of the Valuers, Appraisers and Estate
Agents Act, 1981. In relation to this, the Board of Valuers, Appraisers and
Estate Agents issued a letter to CIMB preventing it from proceeding with
the tender to receive any fees there under.
28.
PW1 informed the court that around 15.2.2008, Pn. Juliza called the
plaintiff and offered RM80,000.00 to settle the matter. The plaintiff however
rejected the offer.
The defendant’s case
29.
It is the defendant’s position that the plaintiff had never been
appointed by the defendant as agent to sell the Hotel to Berjaya. Puan
Juliza (DW1), the General Manager of the defendant pointed out that the
appointment dated 2.8.2002 (‘the Appointment’) which forms the basis of
the plaintiff’s claim did not cover the Hotel. Instead, the Appointment was
made pursuant to a scheme of arrangement carried out by the defendant in
10
year 2000 (“first Scheme”). At all material times, the plaintiff was aware of
this fact.
30.
In any event and or alternatively, according to the defendant, the
Appointment had been superseded by a letter of appointment dated
13.9.2004 (“second Appointment”) issued under another scheme of
arrangement in year 2004. The second Appointment also did not cover the
Hotel.
31.
DW1 testified that the only time the plaintiff was appointed by the
defendant was in respect of the proposed sale of the Hotel to a company
known as KHI. However, the appointment was not ‘open’ but specifically
limited to KHI. Save for KHI, at no time had the plaintiff been appointed by
the defendant as agent to dispose of the Hotel to Berjaya or any of Berjaya
group of companies, or to any other party.
32.
Encik Adnan bin Mohammad (DW2), the Managing Director of the
defendant informed the court that for the purpose of the KHI’s Proposal, the
defendant and KHI had entered into a Memorandum of Business
Exploration which contained an exclusivity clause that refrained the
11
defendant and its agent from contacting, negotiating, discussing or
providing information to any parties other than KHI during the exclusivity
period (“Exclusivity Clause”).
KHI also executed a confidentiality letter
dated 5.5.2006 in favour of the defendant (“Confidentiality Agreement”).
33.
DW2 told the court that on various occasions, the defendant arranged
disclosure to KHI through the plaintiff. The plaintiff at all material times was
fully aware of the Exclusivity Clause and the Confidentiality Agreement.
Notwithstanding that the plaintiff solicited offer from Berjaya at his own
behest and delivered to Berjaya confidential information divulged to him for
the purpose of KHI’s Proposal without the knowledge of the defendant.
34.
DW2 pointed out that consistent with the non-appointment of the
plaintiff, the defendant refused to sign all letters from the plaintiff which
unilaterally imposed condition upon the defendant that the defendant was
liable to pay commission to the plaintiff in the event the offer made by
Berjaya should succeed.
12
35.
Further, DW2 said that consistent with terms of the Exclusivity
Clause, the defendant declined all offers made by Berjaya and returned the
earnest deposit forwarded by Berjaya during the exclusivity period.
36.
According to DW2, when KHI’s Proposal collapsed sometime in the
second quarter of year 2007, the defendant decided to sell the Hotel by
way of tender exercise. He said the plaintiff knew and was aware of the
tender exercise with respect to the proposed sale of the Hotel. The plaintiff
had been asked to submit its bid to lead the tender exercise in conjunction
with other invitees, which the plaintiff did.
37.
Nevertheless, the plaintiff failed in its bid and CIMB Bank Investment
Berhad (‘CIMB’) was appointed as corporate adviser to carry out the tender
exercise.
Berjaya together with other parties made bids for the tender
exercise led by CIMB. Berjaya successfully outbid the other bidders.
The defendant’s counter-claim
38.
DW2 contends that the plaintiff filed this action not for the purpose of
protecting any legitimate interest but for the purpose of harassing or
13
injuring the legitimate interest of the defendant. This is evident when the
plaintiff embarked on a course of conduct designed to intimidate the
defendant and CIMB after he failed the bid to lead the tender exercise.
39.
The plaintiff was at all material times fiduciary of the defendant when
he was appointed as agent in respect of the KHI’s Proposal. By divulging
such information to Berjaya or Berjaya with respect to the affairs of the
defendant which he obtained from the defendant for the purpose of the
KHI’s Proposal only, the plaintiff had breached his fiduciary duty and the
terms of the Confidentiality Agreement.
40.
Notwithstanding his knowledge of the Exclusivity Clause and
Exclusivity Period, by soliciting offers from Berjaya or any parties other than
KHI, the plaintiff had acted in breach of the Exclusivity Clause during the
Exclusivity period.
41.
The defendant therefore claims:
(a)
a declaration that the plaintiff when acting as agent for the
defendant, was a fiduciary of the defendant;
14
(b)
a declaration that the plaintiff acted in breach of his duty when
he divulged information to Berjaya with respect of the affairs of
the defendant which the plaintiff obtained for the purpose of
KHI only;
(c)
a declaration that the plaintiff acted wrongfully in soliciting offers
from Berjaya during the Exclusivity Period in breach of the
Exclusivity Clause;
(d)
a declaration that the plaintiff filed this suit in circumstances
constituting actionable abuse of process;
(e)
exemplary damages;
(f)
costs.
Issues
42.
Based on the pleadings and evidence adduced between the parties,
the issues for determination are as follows :
15
(i)
Whether vide a letter dated 23.1.2002 and 2.8.2002 the plaintiff
was appointed as agent by the defendant, for the sale of the
Hotel.
(ii)
Whether there was an oral appointment by the former NonExecutive Chairman of the defendant.
(iii)
Whether vide a letter dated 13.9.2004, the plaintiff was
appointed exclusively in respect of KHI’s Proposal
(iv)
Whether the plaintiff has breached the Confidentially and
Exclusivity Clause with regard to KHI’s Proposal
(v)
Whether the plaintiff has abused the process of the court
Whether vide letters dated 23.1.2002 and 2.8.2002 the plaintiff was
appointed as agent for the sale of the Hotel.
43.
The plaintiff relies on a letter dated 23.1.2002 issued by FHH and the
defendant’s letter dated 2.8.2002 (First Appointment) as his basis that there
was an agreement between the parties on his appointment by the
defendant to act as agent to secure the purchase of Faber hotels which
16
includes the Hotel. Does these letters point to the plaintiff being the agent
of the defendant?
44.
The defendant on the other hand argues that the First Appointment
did not cover the Hotel based on the following argument :
(i)
The First Appointment which was issued by the defendant
about seven (7) months subsequent to the letter dated
23.1.2002 from FHH did not make any reference to the letter at
all.
(ii)
The letter dated 23.1.2002 was written by FHH, a legal entity
separate and distinct from the defendant.
45.
The court recalls the evidence of PW1 that he and PW2 met with
Encik Amir bin Abdul Rahman (“Amir”), FHH Group General Manager on
23.1.2002. Further to this meeting and on the same day, Amir issues a
letter under FHH letterhead listing details of all the hotels for sale in
including the Hotel. PW1 has given evidence that Amir informed him that
the letter dated 23.1.2003 is to be read together with the Appointment
Letter and as such covers all the said hotels including the Hotel.
17
46.
Further, counsel for the plaintiff submits that the court should draw
adverse inference against the defendant under section 114(g) of the
Evidence Act for not calling Amir as a witness though he was named in the
defendant list of witnesses dated 28.1.2010.
47.
The court notes that the defendant had indeed wanted to call Amir to
testify. However, Amir who currently resides in Saudi Arabia was not
available for the trial which was fixed for 13.10.2010 to 15.10.2010. He
would only be available in December 2010. Thus, the defendant’s solicitor
sought a postponement of the trial but was not allowed by this court. (See
Annexure 1 for the letter dated 27.9.2009 (should read 27.9.2010).
48.
The court of Appeal in the case of Juahir bin Sadikon v
Perbadanan Kemajuan Ekonomi Negeri Johor [1996] 3 MLJ 627 at
p635 held as follows :
“He who alleges must prove such allegation and the onus is on the appellant
to do so. See s 103 of the Act. Thus, it is incumbent upon the appellant to
produce Tan Sri Basir as his witness to prove the allegation. The fact that the
appellant was unable to secure the attendance of Tan Sri Basir as a witness
does not shift the burden to the respondent to produce the witness and
testify as to what he had uttered, as firstly, the respondent never raised such
18
an allegation and secondly, has denied even making one. For this very
reason, the adverse inference under s 114(g) of the Act relied upon by the
appellant cannot be accepted as establishing that if the witness had been
produced, his evidence would work against the respondent. There is no
obligation in law for the respondent to produce the witness as that obligation
rests with the appellant, the party who alleges, and the fact that the appellant
was unable to do so is fatal to his case. For this very reason too, the adverse
inference under s 114(g) is invoked against the appellant.”
49.
In Selvaduray v Chinniah [1939] MLJ 253 CA; [1939] 1 LNS 107 ,
Terrell A-G CJ held that:
“It is no doubt true as mentioned above that if the defendant had been the
claimant, he could not have hoped to satisfy the Court, if he failed to call the
witness with whom he alleged that the negotiations on behalf of the plaintiff
were conducted. The reason for that would be that the Court is entitled to the
best evidence available before it can be called upon for a decision, and if a
plaintiff failed to call a material or essential witness it is almost inevitable that
his claim would be rejected. But it is a very different thing to suggest that in a
case where the onus probandi was not on him but on the other side, a failure
to call a material witness would result in the same fatal consequences”.
50.
In the light of the authorities outlined above, the court finds that since
it is the plaintiff who has alleged that Amir confirmed to him that the First
Appointment covered the Hotel, it is thus incumbent upon the plaintiff to call
19
him. The burden of proof lies upon the plaintiff pursuant to sections 101
and 103 of the Evidence Act 1950 to call Amir as a witness. Given that the
plaintiff has the burden of proof and Amir is a material witness to the
plaintiff’s case, the court finds that no adverse inference can be invoked
against the defendant for not calling Amir.
51.
With regards to the letter dated 23.1.2002, it is not disputed between
the parties that it was issued by FHH. It is also an agreed fact that the two
entities do not share common directorship and thus FHH is a legal entity
separate and distinct from the defendant.
In the case of People’s
Insurance Co (M) Sdn Bhd v People’s Insurance Co Ltd & Ors [1986] 1
MLJ 68 at p 69 which was cited by the defendant, Zakaria Yatim J (as he
then was) held on pg 69 as follows :
“The plaintiff company is a legal entity by itself. Although it is a subsidiary of
the first defendant company, the plaintiff company maintains its own
separate entity. In Ebbw Vale Urban District Council v South Wales Traffic
Area Licensing Authority [1951] 2 KB 366,Cohen L.J. said:
"Under the ordinary rules of law, a parent company and subsidiary
company, even a 100 percent subsidiary company, are distinct legal
entities ...”
20
52.
Since the FHH is a separate legal entity from the defendant, the court
is the view that the letter dated 23.1.2003 cannot in law binds the
defendant. In this regard FHH is not even a party to this present suit.
53.
I am of the view that as a matter of law, the conduct and
management of the affairs of a company is vested in the board of directors
as a collective body, in this case, the board of directors of the defendant,
Faber Group Berhad. Amir was never a director of the defendant, but
group general manager of FHH. There is no documentary evidence to
suggest that FHH was given authority by the defendant’s group to act on its
behalf either in selling any of its hotels, including the Hotel, or to appoint
agent for that matter. There is, however, documentary evidence to suggest
that in all cases when it came to the disposal of hotels, it was the defendant
that issued letter conferring authority upon the plaintiff to sell the hotels
(other than the Hotel). (See First Engagement dated 2.8.2002 at p 176 of
Bundle B and Second Engagement dated 13.9.2004 at p 178 of Bundle B).
54.
Further, the court agrees with the contention of learned counsel for
the defendant that the letter dated 23.1.2002 was not an appointment letter
21
but a mere provision of information to the plaintiff. The second paragraph
of the letter reads :
“We thank you for the interest shown in our properties, and hope that the
information provided below, will be beneficial to your consideration.”
The letter dated 2.8.2002
55.
The plaintiff relies on the defendant’s letter dated 2.8.2002 in support
of his claim that he was appointed as the defendant’s agent for the sale of
the Hotel to Berjaya because the letter is an “open appointment”. It is
undoubtedly true that the plaintiff was appointed by the defendant vide a
letter dated 2.8.2002 (First Appointment) to act as agent in securing the
purchase for properties held under Faber. The First Appointment appears
on pg 176 of Bundle B which states as follows :
“In consideration to your request through Mr. Kurian Cherian, we are
agreeable to have your Company to act as agent in securing the purchase
for properties held under Faber, by any parties who has expressed interest in
purchasing our properties through your goodselves. The offer, however,
will be subject to the approval of our Board, Bondholders and
shareholders.”
22
56.
The court notes the evidence of PW2 that the letter dated 2.8.2002
was issued further to the 1.2.2002 letter and that it covered all of the hotels
including the Hotel under the defendant. Whilst it is true that the Hotel is
one of the properties owed by the defendant, the defendant contends that
the sale of the properties held under Faber did not include the Hotel.
57.
On this issue, evidence was led by DW1 that the First Appointment
was issued pursuant to the debt restructuring scheme carried out by the
defendant in year 2000 (the First Scheme).
The First Scheme was
implemented by the defendant pursuant to a Trust Deed dated 13.9.2000
(pg 77 of Bundle B).
Clause 16.1.7 of the Trust Deed required the
defendant to :
“appoint a property consultant acceptable to the Trustee within twenty four
(24) months from the date of this deed to seek potential buyers for the
Strategic Charged Assets and the Other Charged Assets.”
58.
The court notes that under the Trust Deed the ‘Strategic Charged
Assets’ as defined and set out in Schedule 4 of the Trust Deed (pg 164 of
Bundle B) does not include the Hotel.
Neither did the ‘Other Charged
Assets’ as defined in the Trust Deed include the Hotel (pg 49 of Bundle B).
23
59.
In this case, the court is faced with conflicting testimony of PW2 and
DW1 as to whether the sale of the hotels held under Faber includes the
sale of the Hotel.
60.
The court in thus faced with the task of having to choose whose
evidence to believe. In discharging this task, I am guided by the decision of
the following authorities in Tindok Besar Estate Sdn Bhd v Tinjar Co
[1979] 2 MLJ 229 where Justice Chang Min Tat (as he then was) said:
“For myself, I would with respect feel somewhat safer to refer to and rely on
the acts and deeds of a witness which are contemporaneous with the event
and to draw the reasonable inferences from them than to believe his
subsequent recollection or version of it, particularly if he is a witness with a
purpose of his own to serve and if it did not account for the statements in his
documents and writings. Judicial reception of evidence requires that the oral
evidence be critically tested against the whole of the other evidence and the
circumstances of the case. Plausibility should never be mistaken for
veracity.”
24
61.
The above approach was also applied by James Foong J (as he then
was) in Industrial Concrete Products [2001] 8 CLJ 262 and Low Hop
Bing J (as he then was) in the case of Nuri Asia Sdn Bhd Supra.
62.
In Noorianti Zainol Abidin & Ors. v Tang Lei Nge [1990] 1 CLJ
943 Lim Beng Choon J (as he then was) had occasion to say that the trial
judge should not approach the case on the basis of deciding which story
out of the conflicting stories that should be believe, but rather to consider
which version was inherently probable or improbable.
All things being
equal, it is trite law that if the version of one of the parties is inherently
probable, then the judge has no choice but to accept the version forthwith
(see Chua Chong Cher v Teo Lang Keow & Ors [1970] 2 MLJ 27.
Abdul Kadir bin Mohamad v Kamarulzaman bin Mohd Zin & Anor
[2000] MLJU 658).
63.
In Muniandy & Ors v. Public Prosecutor [1966] 1 LNS 110; [1966]
1 MLJ 257, the trial judge accepted the evidence of certain witnesses
because they had remained unshaken in cross examination. Based on that
evidence he convicted the appellant. The Federal Court reversed the
decision, Ong Hock Thye FJ said:
25
“In the instant case, it is stated by the learned trial judge as the ground for
his belief in the main prosecution witnesses, that they had been unshaken in
cross-examination. In our view, being unshaken in cross examination is not
per se an all-sufficient acid test of credibility. The inherent probability or
improbability of a fact in issue must be the prime consideration. The fact that
the trial judge believed implicitly in the truthfulness of Nagarachnam and
Ramasamy does not preclude closer scrutiny of their evidence and this we
have done.”
64.
Returning to this issue, PW1 in his evidence claims that he was not
aware of the First Scheme at the time of the First Appointment. On the
contorary, DW1 pointed out to the court that it is apparent from the opening
sentence in the second paragraph of the defendant’s letter dated 2.8.2002
that the plaintiff’s request for the appointment was made through a person
called “Mr. Kurian Cherian”. In this regard, DW1 told the court that “Mr.
Kurian” was a representative from Danaharta and that Danaharta
subscribed for the 2000/2005 A Bonds under the First Scheme. As such,
the court finds that it would be highly improbable for the plaintiff not to know
about the First Scheme since the letter dated 2.8.2002 shows that the
plaintiff made his request to be appointed as agent through “Mr. Kurian”. In
fact no evidence was led by the plaintiff to rebut this fact.
26
65.
The court notes that PW2 was never a director of the defendant and
thus could not be involved in any of the decision making process of the
defendant. In cross-examination, PW2 admitted that he does not know
when the board of directors of the defendant discussed the business
strategies including the exercise to sell the Hotel. This is contrary to what
he said at question 9 of his Witness Statement.
66.
PW2 in his evidence claimed that it was the practice that each
member would offer assistance to the other members of the Faber Group,
where needed, and that he offered his assistance to the defendant to sell
the Hotel.
However, an examination of all the Group Management
Committee Meetings (‘MCM’) from 2005 to 2006 (Bundle G, pg 18 – 278)
clearly does not show that the management committee was involved in the
disposal of any of the hotels of the defendant in any manner whatsoever.
On the contrary, the minutes show that the head of each subsidiary
company of the defendant would report to the Managing Director of the
defendant at the MCM on the status and issues affecting the individual
subsidiary. For example, see minutes dated 6.1.2006 at p 26 on staffing
issues, facilities management and business development for Faber
Facilities Sdn Bhd (‘FFSB’) of which PW2 was in charge.
27
67.
Of material consideration is the fact that the letter dated 2.8.2002
states that :
“The offer, however will be subject to the approval of our Board, the Bond
holders and shareholders”.
68.
The evidence adduced would show that the defendant’s Board
rejected both Berjaya offers dated 16.5.2007 (pg 229 Bundle B) and
6.6.2007 (pg 258 Bundle B). In the letter of rejection dated 18.6.2007 (pg
265 Bundle B), the defendant informed Berjaya that it had decided to carry
out a tender exercise in respect of the disposal of the Hotel.
69.
On the evidence both oral and on the contemporaneous evidence,
the court finds that the plaintiff has not proven on a balance of probabilities
that the defendant had agree to appoint the plaintiff as its agent for the sale
of the Hotel vide its letter dated 2.1.2002 and 2.8.2002.
The letter dated 13.9.2004 (Second Appointment)
70.
Having said that, the court will next deal with the issue of whether the
plaintiff was appointed as agent in respect of the sale of the Hotel vide a
letter dated 13.9.2004.
28
71.
DW4 gave evidence that the First Scheme did not go through and
was substituted by another restructuring scheme carried out by the
defendant in year 2004 (the Second Scheme). It is the defendant’s claim
that the plaintiff was appointed as the exclusive agent for the Asset
Disposal Programme under the Second Scheme.
However, it is the
defendant’s position that the Asset Disposal Programme did not include the
Hotel. The letter of appointment dated 13.9.2004 (pg 178 of Bundle B)
(Second Appointment) states as follows :
“We were pleased to inform that Messrs. Zerin Properties appointment as the
Exclusive Property Agent for the Asset Disposal Programme under the
Proposed Restructuring Scheme has been approved by our management
based on the fee structure set out as listed in Schedule 1.”
72.
The court has carefully examine the letter dated 13.9.2004 and notes
that Schedule 1 to the Second Appointment did not include the sale of the
Hotel. In fact, DW1 confirmed in cross-examination that the appointment
did not include the Hotel.
73.
However, the plaintiff in its submission argues that the First
Appointment is a general appointment whilst the Second Appointment is
specific in nature.
The court notes that some of the hotels under the
29
Assets Disposal Programme overlapped with the Strategic Charged Assets
listed under the First Scheme. As such, I accept the argument of learned
counsel for the defendant that if the plaintiff’s interpretation is correct, it
would have been superfluous to appoint a non-exclusive agent exclusively
for the same set of properties.
74.
The evidence adduced showed the First Appointment letter and the
Second Appointment letter did not include the sale of the Hotel by the
defendant.
Therefore in my judgment, vide letters dated 2.8.2002 and
13.9.2004, the plaintiff was not appointed by the defendant as its agent for
the sale of the Hotel.
The letter dated 14.9.2006 (Exclusive Appointment for KHI’s Proposal)
75.
It is the defendant’s case that the only time the plaintiff was appointed
to sell the Hotel was vide its letter dated 14.9.2006 in respect of the sale of
the Hotel to KHI (pg 197 of Bundle B) (KHI Appointment). The letter reads
as follows :
“As agreed, should the above company and/or their subsidiaries/ nominees
subsequently enter into a contract(s) to purchase the above property, then
Faber Group Bhd and/ or their nominees shall pay Zerin Properties a
30
commission equivalent to 1.4% of the successful transacted sale purchase
price or 1.7% of the amount received by Faber Group Bhd and/ or their
nominees, whichever is the higher.
This commission together with an additional 5% Government Service Tax
(GST) is due and payable upon the Sale & Purchase Agreement being
unconditional.
In the event that a transaction is aborted after earnest or deposit monies has
been paid and Faber Group Bhd and/ or the nominees is entitled to forfeit
the monies, then Faber Group Bhd and/ or the nominees shall pay Zerin
Properties an abortive fee equivalent to 50% of the amount forfeitable but not
exceeding the agency fee due to Zerin Properties, whichever is the lesser..”
76.
The court notes that the exclusive nature of the KHI’s engagement
can be seen from the Memorandum of Business Exploration dated
14.9.2006 (‘MBE’). The Exclusivity Clause in the MBE reads:
Exclusivity
In consideration of Kingdom incurring costs of professional advisers and other
expenses and expending further management time in considering the proposal to
acquire Company, from the date of the Seller’s acceptance of this letter up to 17
November 2006, or such earlier date as Definitive Agreement are executed by
the Parties with respect to the Transaction (the “Exclusivity Period”), the Seller its
affiliates and advisers shall refrain from contacting negotiating, entering into
discussion with or providing information to any other potential purchasers or
lessees of the Company, with respect to the potential purchase either directly or
31
indirectly, by such potential purchasers of the Company and/or the Company or
any of the Seller’s interest therein.
77.
The MBE also contained a confidentiality clause as follows:
Confidentiality
The parties agreed not to disclosed to any third party and not to use,
except the for the purpose of this letter, any technical or commercial
information of a confidential nature made available to either party by the
other party may have learned or obtained in the course of this letter. All
such information shall be returned to the disclosing party at its request upon
termination of this letter. The above provision shall survive for five (5) years
after the termination of this letter. [Emphasis added.]
78.
The court notes that the plaintiff’s appointment in respect of the sale
of the Hotel to KHI was subsequently terminated by the defendant on
18.6.2007 (pg 265 of Bundle B). There is no evidence to suggest that the
plaintiff accepts the termination with protest or written into the defendant
refute the contents of the said letter.
Oral appointment by the former Non-Executive Chairman
79.
To proof further that the plaintiff was appointed as agent for the sale
of the Hotel, the plaintiff pleaded an alleged oral appointment and led
32
evidence of a meeting in March 2007 between him with the former nonexecutive Chairman of the defendant, Dato’ Anuar bin Aji (“Dato’ Anuar”).
80.
The plaintiff alleged that when the KHI first offer falls, PW2 arranged
for plaintiff and him to meet the non-executive Chairman of the defendant
Dato’ Anuar at a coffee shop on the first floor of Faber Towers (the March
meeting). According to the plaintiff, during the March meeting Dato’ Anuar
informed the plaintiff that he was very upset with how Puan Noorizah was
handing the sale of the Hotel and he also asked why the negotiations with
KHI to buy the said interest had failed. Further the plaintiff informed the
court that Dato’ Anuar has requested that the plaintiff arrange to reinstate
the KHI offer and also look for other purchasers for the said interest.
81.
PW2 testified that once again he arranged for plaintiff and him to
meet Dato’ Anuar at the Maya Hotel, KL over dinner during which plaintiff
confirmed Berjaya were very keen to buy the said interest (May meeting).
In the same meeting, Dato’ Anuar requested the plaintiff to arrange to get
an official offer from Berjaya.
33
82.
The court further notes that evidence was led that following the
request made by Dato’ Anuar in the May meeting, the plaintiff made contact
with the Berjaya Corporation Group of Companies (Berjaya) and introduced
the Hotel to Berjaya (“the said introduction”).
83.
After the May meeting plaintiff sent email dated 15.05.07, (pg 233 of
Bundle B) to Berjaya enclosing information about budget forecast and the
management accounts for the Hotel.
84.
Following from the said introduction, plaintiff arranged for Berjaya to
make an offer in the sum of USD45,500,000.00 for the said interest (“the
said first offer”) (B229-232). On same day plaintiff issued letter to Dato’
Anuar c/o the defendant confirming the teleconversation with Dato’ Anuar,
the said introduction as well as the said fee. During the telephone
conversation in question, Dato’ Anuar informed the plaintiff that the said
first offer was not enough and asked him to obtain a higher one.
The
plaintiff in his evidence stated that as directed by Dato’ Anuar, on 6.6.2007
he arranged for Berjaya to make a second offer of USD49,000,000.00 to
buy the Hotel (the second offer).
34
85.
Thus, based on the foregoing evidence, the plaintiff submitted that
the defendant’s conduct in requesting the plaintiff to obtain other offers and
an official offer from Berjaya pursuant to the March and May meetings, the
defendant is estopped from denying the fact that the appointment letter
subsisted in relation to the said hotels not covered by the second Scheme
including the Hotel.
86.
Learned counsel for the defendant contends it is obvious that Dato’
Anuar was a material witness to the plaintiff’s case of oral appointment. In
this respect, only Dato’ Anuar can confirm the truth of the allegations as
pleaded in paragraphs 11 and 13 of the Statement of Claim and the
evidence of PW1. Yet, the plaintiff chose not to call Dato’ Anuar to testify in
court.
In this regard, learned counsel for the defendant submitted that
adverse inference under section 114(g) of the Evidence Act 1950 should be
drawn against the plaintiff.
87.
On this issue, the defendant relied on the case of Seascope Sdn
Bhd v Syed Izhar Syed Syed Salleh [2005] 8 CLJ 624 at p 650 to
support its contention that the burden is on the plaintiff to call Dato’ Anuar
35
to give evidence as to the existence of the meetings and the oral alleged
appointment.
88.
In Seascope Sdn Bhd v Syed Izhar Syed Salleh, Ramly Ali (now
JCA) held as follows :
“Where the onus is on the plaintiff to prove a point and he does not do so,
the failure of the defendant to call a witness on the issue cannot be held
against them.”
89.
The court finds that since it is the plaintiff who alleged the existence
of the oral appointment in regard to the Hotel, based on section 102 of the
Evidence Act and the Court of Appeal decision in Juahir bin Sadikon, the
burden is on the plaintiff to call Dato’ Anuar. In fact adverse inference can
be drawn by the court against the plaintiff for not calling Dato’ Anuar to
verify the existence of the oral appointment.
90.
The court notes that vide a letter dated 16.5.2007 (pg 465 Bundle B)
the plaintiff states that:
“Yg Bhg Dato, we take this opportunity to thank you for allowing us to be of
service to you and would appreciate if you could acknowledge the above
36
introduction and also the commission structure by executing the
duplicate copy and returning same to us.”
91.
An important fact is that neither Dato’ Anuar nor anyone else from the
defendant acknowledges the introduction and also the commission
structure as stated in the letter by executing the duplicate copy and
returning the same to the plaintiff. If Dato’ Anuar had in fact authorised the
plaintiff to solicit an offer from Berjaya, it would have been natural for him to
acknowledge the appointment by signing the letter.
92.
It is pertinent to note that the non-signing of this letter cannot be
viewed in isolation. It is in sharp contrast with the defendant’s conduct in its
previous dealings with the plaintiff. Previously, the defendant would either
issue the letter of appointment itself or acknowledge the appointment by
signing on the appointment letters written by the plaintiff. This can be seen
from the First Appointment letter dated 2.8.2002 (pg 176 of Bundle B), the
letter of appointment dated 13.9.2004 in respect of the Second Scheme (pg
178 of Bundle B) and the letter of appointment dated 14.9.2006 in respect
of KHI Appointment Letter (pg 197 of Bundle B). In fact, the language of
the letter dated 16.5.2007 is similar or substantially similar to that of the
KHI Appointment Letter.
37
93.
Secondly, the letter dated 16.5.2007 referred to fee structure which
was allegedly agreed upon between the plaintiff and the Chairman.
However, there is no evidence that the fee structure was ever discussed at
the May 2007 meeting.
94.
In any event, I am of the view that Dato’ Anuar was a non-executive
chairman of the defendant and thus he has no actual authority to enter into
a contractual relationship on behalf of the defendant. In Freeman &
Lockyer v Buckhurst Park Properties (Mangal) Ltd [1964] 2 QB 480,
Lord Diplock at p 505 held:
“It follows that where the agent upon whose ‘apparent’ authority the
contractor relies has no ‘actual’ authority from the corporation to enter into a
particular kind of contract with the contractor on behalf of the corporation, the
contractor cannot rely upon the agent’s own representation as to his actual
authority. He can rely only upon a representation by a person or persons
who have actual authority to manage or conduct the part of the business of
the corporation to which the contract relates.
95.
Further, in this present case, it is not disputed that both PW1 and
PW2 were aware of the fact that Dato’ Anuar was a non-executive
chairman at the time of dealing with him. This information is also publicly
38
available as the defendant is a public listed company. As such, the plaintiff
cannot rely on the principle of ostensible authority.
96.
Given that the defendant had never authorised the plaintiff to solicit
an offer from Berjaya, the defendant rejected both Berjaya’s offers dated
16.5.2007 (Bundle B, p 229) and 6.6.2007 (Bundle B, pg 258). In the letter
of rejection dated 18.6.2007 (Bundle B, p 265), the defendant informed
Berjaya that it had decided to carry out a tender exercise in respect of the
disposal of the Hotel. The court notes that the reason for carrying out the
tender exercise (which was made after the KHI’s Proposal had lapsed on
18.6.2007) was fully deliberated by the Board of Directors of the defendant
at the meeting on 18.6.2007 (pg 367 of Bundle B).
97.
The court finds that the plaintiff’s email dated 22.6.2007 (pg 270 of
Bundle B) to the defendant is the plaintiff’s proposal in respect of the sale
of the Hotel through the tender exercise. In fact in cross-examination PW1
confirmed that his proposal to the defendant at pg 271-278 of Bundle B did
not mention at all if the sale is to Berjaya, he is entitled to the commission.
39
98.
Further, I accept the defendant’s submission that if as claimed, the
defendant had agreed to the plaintiff’s entitlement of commission in selling
the Hotel, there is no need for the plaintiff to submit its bid for corporate
adviser. In other words, by submitting the bid, the plaintiff was aware that
there is no contractual relationship between the plaintiff and the defendant
after the KHI’s Proposal had lapsed.
As stated earlier, the KHI
Appointment was terminated by the defendant as of 18.6.2007 and the
plaintiff accepted the termination without protest.
(See letter dated
13.8.2007 in Bundle B, pg 282). That being so, it follows that as that date,
there did not exist a contract or agreement between the plaintiff and the
defendant.
99.
The plaintiff has relied on the High Court case of Singham Sulaiman
Sdn Bhd (berniaga) sebagai Jones Lang Bhd [2004] 4 AMR as an
authority for the proposition that when a person has been appointed as
agent he is entitled to commission. In Singham case (supra) the plaintiff
as estate agency was appointed by the defendant vide a letter dated
14.6.1995 for the purpose of disposing of a multi storey building. In the
letter, the defendant agreed to pay brokerage commission upon successful
introduction of sale of the properly. The plaintiff introduced the properly to
40
Credit Guarantee Corporation (M) Bhd (CGCM) and accordingly informed
the defendant.
Eleven months after the appointment, the defendant
through its marketing manager, appointed another estate agency namely
Resma Holdings Sdn Bhd for the same purpose for which the defendant
was appointed. Resma Holdings subsequently informed the defendant that
its client CGCM had agreed to purchase the property. At the same time,
CGCM conveyed its agreement to purchase the property to the plaintiff,
without making any reference as to who the introducer for the property was.
The sale of the property was concluded between the defendant and the
brokerage commission was paid to Resma Corporation instead of the
plaintiff.
The plaintiff claimed an entitlement to the commission on the
basis that it was the initial introducer of CGCM and that as a result of its
efforts there had been a “successful introduction of the sale of the
property”. The court held that the plaintiff is entitled to the commission on
the ground that the introduction of CGCM brings about a “successful
introduction of sale” within the meaning of the plaintiff’s letter of
appointment.
100. Upon careful reading, the High Court decision in Singham case can
be distinguished. From the facts in Singham case, there was documentary
41
evidence of the estate agent’s appointment to sell the property (which was
then under construction) in the form of a letter dated 14.6.1995 signed by
the defendant’s Executive Director.
This appointment obligated the
defendant to pay commission ‘upon successful introduction of sale of the
property’. After the appointment, the letter was not revoked.
101. In the present case, the plaintiff relies on the First Engagement letter
dated 2.8.2002 as documentary proof of appointment. However, that
appointment did not relate to the Hotel under the first Scheme. Therefore,
this aspect of the plaintiff’s claim is different from the basis upon which the
agent in the Singham case sought to establish its unrevoked agency.
102. Learned counsel for the plaintiff has also relied on the case of Tong
Lee Hua v Yong Kah Chin [1979] 1 MLJ 233.
103. In Tong Lee Hua case, the vendor gave an unqualified written
undertaking to the agent that he shall be entitled to a commission of 6.5%
of the sale price upon the successful conclusion of the sale of the land. The
vendor disputed the agent’s entitlement to the commission alleging that the
sale was done not through the brokerage, but through an option, the
42
validity of which was disputed. The court found that notwithstanding the
validity or otherwise of the option, the vendor had himself acknowledged
the efforts and part played by the agent in effecting the purchase. At page
236 of the judgment, Chang Min Tat F.J (as he then was) held:
“And the answer to this question lies in the letter of his then solicitors of
November 7, 1975. The part played by the respondent in effecting the
purchase is clear and beyond argument. Confirmation, if necessary, can be
found in the previous correspondence between the parties in person.”
104. The fact in Tong Lee Hua case is different from the present case. In
the present case, the defendant’s conduct in not confirming the letter dated
16.5.2007 from the plaintiff, its rejection of both Berjaya’s offers, the
decision to go for tender and the plaintiff’s bid for the corporate advisor
show that there is no agreement between the plaintiff and the defendant
with respect to the sale of the Hotel to Berjaya.
105. In the case of Ong Kee Ming v Quek Yong Kang [1991] 3 MLJ 294
the Federal Court held as follows :
43
“The law is not in dispute. In the absence of any special contractual terms,
the general principle is that the agent must be the effective cause of the sale.
It is a question of fact in each case.”
106. In the present case, there is a written engagement in the form of the
First Engagement letter and Second Engagement letter. However, these
two (2) engagements do not relate to the Hotel.
107. Further, in Ong Kee Ming case, on the facts, there was no doubt that
the plaintiff was the cause of the ultimate sale. In the present case, the
defendant’s conduct in not confirming the letter dated 16.5.2007 from the
plaintiff, its rejection of both Berjaya’s offers, the decision to go for tender
and the plaintiff’s bid for the corporate advisor show that there is no
agreement or continuous arrangement between the plaintiff and the
defendant with respect to the sale of the Hotel to Berjaya.
Breached of Confidentiality and Exclusivity
108. The defendant in its counter-claim contends that the plaintiff had
acted in breach of his fiduciary duty when he divulged information to
44
Berjaya with respect to the affairs of the defendant which the plaintiff
obtained for the purpose of KHI’s only.
109. In respect of the conduct of divulging these proprietary information to
Berjaya, the plaintiff raised two issues in his defence. Firstly, he was not a
party to the MBE and was not bound by the exclusivity and confidentiality
clause. Secondly, the information was obtained by the plaintiff from public
domain and is non-confidential.
110. At trial, PW1 denied he had specific knowledge of the MBE and the
Exclusivity Clause. However, in his witness statement, PW1 said:
(i)
He had knowledge that in the MBE, KHI made its first offer of
USD 49 million in acquiring the interest in the Hotel;
(ii)
He had knowledge that the MBE contained an Exclusivity
Clause;
(iii)
In cross-examination, he admitted that he forwarded the MBE
to the defendant on 18.9.2006.
45
111. Based on the above evidence, the irresistible conclusion to be drawn
is that the plaintiff was aware of the confidentiality and exclusive nature of
his engagement to sell the Hotel at all material times.
112. Evidence subsequent to the MBE shows that the plaintiff was the
conveyor between KHI and the defendant during the period of negotiation.
Offers and revised offers had been transmitted between parties through the
plaintiff on 18.5.2007 (pg 250 of Bundle B), and 4.6.2007 (pg 363-364 of
Bundle B). In cross-examination, the plaintiff also admitted that he was
aware that exclusivity period in respect of KHI’s Proposal was extended
from 17.11.2006 to 31.1.2007.
113. The plaintiff in his evidence never denied his conduct in divulging
confidential and proprietary information to Berjaya.
However, the case
pleaded by the plaintiff was that the proprietary information was available in
public domain and was non-confidential.
114. On this issue, the court agrees with the defendant’s submissions that
evidence shows that at all material times, the plaintiff was aware that the
proprietary information which he divulged to Berjaya was confidential based
46
on the following grounds :
(a)
In an email dated 13.3.2007 (pg 221 of Bundle B), the plaintiff
had informed Berjaya as follow:
We refer your meeting with Mr. Previn on the above matter and attached
herewith the relevant financial information for your perusal and further
consideration. Kindly be informed that the information are Private and
Confidential and should be treated with strictest confidence.
(b)
In an email dated 15.5.2007 to Berjaya (pg 233 of Bundle B ),
the plaintiff stated as follow:
We refer to our teleconversation on the above and attached herewith the
forecast for Sheraton Hanoi and YTD March 2007 Sheraton Hanoi
management accounts.
Kindly be informed again that the information are to be treated with
strictest confidence.
(c)
The information disclosed by the plaintiff to Berjaya including
financial information, forecast, annual budget, operative and
unaudited accounts are not publicly available documents.
47
115. In this regard, the plaintiff who was engaged to act as the exclusive
property agent of the defendant owed fiduciary duties to the defendant as
his principal and was bound by the Exclusivity Clause and Confidentiality
Clause as much as KHI was bound.
116. However based on the evidence of DW2 in cross-examination that
the defendant had not suffered any losses due to the divulging of the
information to Berjaya, there is no damage to be awarded to the defendant
as result of the breach.
Breached by CIMB
117. The plaintiff claims that CIMB has breached the Valuers, Appraisers
and Estate Agents Act 1981 in carrying out the business of estate agency.
In this regard, the plaintiff produced two (2) letters issued by the Board of
Valuers, Appraisers and Estate Agents (“Board of Valuers”). The first
letter dated 21.11.2007 was issued by the Board of Valuers to the plaintiff,
while the second letter dated 3.10.2007 was to CIMB Investment Bank
(“CIMB”), the corporate advisor of the defendant (see Bundle E).
48
The
court observes that from the two (2) letters, the plaintiff was the
complainant.
118. The issue of whether CIMB has breached the law is not a relevant
issue before this court. CIMB is not even a party to this suit. Further, there
is no evidence before the court as to whether CIMB has responded to the
Board of Valuers and the position they take, whether the complaint was
dismissed or prosecuted further.
Abuse of the court process
119. The defendant in its counter-claim alleged that the plaintiff’s action
was filed not for the purpose of protecting any legitimate interest of the
plaintiff but for the purpose of harassing or injuring the legitimate interest of
the defendant as the defendant knew that his appointment was only in
respect of KHI’s Proposal. Counsel for the defendant referred the court to
the case of Malaysia Building Society Bhd v Tan Sri General Ungku
Nazaruddin Ungku Mohamed [1988] 2 CLJ 230 where Gopal Sri Ram
JCA (as he then was) said :
49
“Every person who is aggrieved by some wrong he considers done him is at
liberty to invoke the process of the court. Equally may a litigant invoke the
process to enforce some claim which he perceives he has against another.
When however, the process of the court is invoked, not for the genuine
purpose of obtaining the relief claimed, but for a collateral purpose, for
example, to oppress the defendant, it becomes an abuse of process. Where
the court’s process is abused, the proceedings complained of may be
stayed, or if it is too late to grant a stay, the party injured may bring an action
based on the tort of collateral abuse of process.”
120.
Further at pg 356 his Lordship explained that the essential elements
of the tort of abuse of process are as follows :
(1)
The process complained of must have been initiated;
(2)
The purpose for initiating that process must be some purpose other
than to obtain genuine redress which the process offers. In other
words, the dominant purpose for which the process was invoked must
be collateral, that is to say, aimed at producing a result not intended
by the invocation of the process
(3)
The plaintiff must have suffered some damage or injury in
consequence.”
121. Applying the above principles, to the facts and circumstances of this
present case, the defendant’s argument that the action by the plaintiff is to
injure the interest of the defendant is in my opinion without merit. In my
50
judgment, to borrow the words of his Lordship Gopal Sri Ram in Malaysia
Building Society case, “every person who is aggrieved by some wrong he
considers done to him is at liberty to invoke the process of the court”. In
this instant case, there is no evidence to show that the plaintiff invoked the
court process, for purpose other than to obtain genuine redress.
122. In my judgment, the plaintiff invoked the process to enforce claim
which he perceives he has against the defendant. Based on the evidence
adduced, the plaintiff has put the defendant on notice about his claim
through numerous letters as well as those by his solicitors before and after
the conclusion of the sale of the Hotel.
As the defendant denied the
plaintiff’s claims, the plaintiff filed this action. Even before filing this action
the plaintiff made direct and indirect overtures to the defendant to try to
settle this matter amicably. The plaintiff was open to settlement however
the defendant made very clear then that they were not interested to settle.
Conclusion
123. Based on the foregoing, the court finds that the plaintiff has not
succeeded in proving on balance of probabilities, that he was entitled to be
51
paid a fee of RM3,359,538.00. As such, the plaintiff’s claims against the
defendant is dismissed with costs.
124. Further, the court finds that the defendant has proved its counterclaim against the plaintiff for breach of Confidentially and Exclusivity
Clause.
However, the court has not awarded any amount as general
damages since the evidence adduced in this regard shows that the
defendant has not suffered any losses.
The court also finds that the
defendant has not proved its counter-claim against the plaintiff for abuse of
the court process in filing this action. Accordingly, prayer 43 (3), (4) and (5)
of the defendant’s defence and counter-claim is hereby dismissed with
costs.
(Hanipah binti Farikullah)
Pesuruhjaya Kehakiman
Dagang 7
KUALA LUMPUR
Dated : 5.12.2010
52
Solicitor for the Plaintiff
Dhiren Norendra bersama Saroop Rampal
Messrs Norendra & Yap
Advocates & Solicitors
No. 1, jalan Tempinis 1
Lucky Garden, Bangsar
59100 Kuala Lumpur
Solicitor for the Defendant
Kelvin Seet Wan Nam bersama Carol Tiong Hui yii
Messrs Cheang Ariff
Advocates & Solicitors
39 Court @ Loke Mansion
273A Jalan Medan Tuanku
50300 Kuala Lumpur
53