GCH RETAIL (MALAYSIA) SDN BHD CRYSTAL PROMENADE SDN BHD (DAHULUNYA DIKENALI SEBAGAI H LAND DEVELOPMENT SDN BHD)

WA-22NCvC-455-08/2023 Kand. 101 23/04/2024 17:03:30 DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN, MALAYSIA GUAMAN NO. WA-22NCVC-455-08/2023 ANTARA GCH RETAIL (MALAYSIA) SDN BHD No. Pendaftaran Syarikat: 200401028527 (667035-P)] … PLAINTIF DAN CRYSTAL PROMENADE SDN BHD [DAHULUNYA DIKENALI SEBAGAI H LAND DEVELOPMENT SDN BHD] No. Pendaftaran Syarikat: 199901026588 (501488-X) … DEFENDAN GROUNDS OF JUDGMENT (ENCLOSURE 8, 10, & 47) INTRODUCTION [1] These grounds are prepared for the appeals founded on the decisions of this Court pertaining to – 1 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal (i) the Plaintiff’s application to expunge two (2) letters of exhibit in the Defendant’s affidavit (Enclosure 47) which was allowed with cost. (ii) the Defendant’s application to strike out the Plaintiff’s claim under O18R19 of the Rules of Court 2012 (ROC 2012) (Enclosure 10) which was allowed with cost; and (iii) the Defendant’s application for a summary judgment under O14 R5 for the Defendant’s counter claim (Enclosure 8) which was allowed with cost; [2] The reasoning behind this Court’s decision is as deliberated. BRIEF FACTS [3] The Plaintiff is a tenant of the Defendant’ demised premises held under HSD 51689, PT 1336, Mukim Bandar Selayang, Daerah Gombak, Negeri Selangor (Demised Premises). There was a tenancy agreement dated 16.04.2004 (Tenancy Agreement) which the first term of the tenancy was fixed for three (3) years and allows options to renew the tenancy upon expiry of each fixed term which valid for seven (7) terms, subject to the same terms and conditions in accordance to clause 2.2 of the Tenancy Agreement. 2 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal [4] Clause 2.2 of the Tenancy Agreement provides- “2.2 It is hereby agreed by both parties that in addition to the First Term herein created, there shall be a further five (5) renewal terms of three (3) years each and one renewal term of two (2) years which shall be upon the terms as set out below…” [5] It was not disputed that there are seven (7) fixed terms of the Tenancy Agreement as set out under Clause 2.2 for the Defendant to let to the Plaintiff the Demised Premises from an original initial term of three (3) years (First Term) with a further five (5) renewal terms of three (3) years each and one (1) renewal term of two (2) years as follows: Term Period Manner of Renewal Second Term 3 years from expiry Automatic Renewal. of First Term (Year 4 – 6) Third Term 3 years from expiry Automatic Renewal. of Second Term (Year 7 – 9) Fourth Term 3 years from expiry Automatic Renewal. of Third Term (Year 10 – 12) Fifth Term 3 years from expiry Automatic Renewal. of Fourth Term (Year 13 – 15) Sixth Term 3 years from expiry The renewal for this Sixth Term may of Fifth Term be exercised by serving a notice in (Year 16 – 18) writing to the Defendant confirming the wishes to extend the tenancy for the Sixth Term at least 6 months before the expiry of the Fifth Term. 3 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal Seventh Term 2 years from expiry The renewal for this Seventh Term of Sixth Term may be exercised by serving a (Year 19 – 20) notice in writing to the Defendant confirming the wishes to extend the tenancy for the Sixth Term at least 6 months before the expiry of the Fifth Term. [6] Clause 2.2 of the Tenancy Agreement is clear and unambiguous that the aggregate period of the First Term up to the Seventh Term is only for twenty years. [7] The Plaintiff expressed their intention to continue with the tenancy of the Demised Premises but the Defendant replied that "we will not be extending the tenancy of the demised premises beyond 31 January, 2024." and thereafter gave notice to the Plaintiff to vacate and yield vacant possession of the Demised Premises on or before 31.01.2024. [8] Subsequently the Tenancy Agreement came to an end after the lapse of the Seventh Term of the Tenancy Agreement and the Defendant entered into a Tenancy Agreement with TF Value-Mart Sdn. Bhd as its new tenant. 4 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal FINDINGS AND ANALYSIS Enclosure 47 [9] The Plaintiff filed Enclosure 47 to expunge two letters dated 14.06.21 and 12.10.2021 which was referred to in paragraph 16 of the Affidavit in Reply affirmed by Lim Chin Heng in Enclosure 18. The ‘without prejudice’ letters were letters written by the Plaintiff in the course of proposing and negotiating the renewal of the tenancy. [10] This Court allows Enclosure 47 based on the Federal Court decision in Malayan Banking Bhd v Foo See Moi [1981] 2 MLJ 17 that held- “it is settled law that letters written without prejudice are inadmissible in evidence of the negotiations attempted. This is in order not to fetter but to enlarge the scope of the negotiations, so that a solution acceptable to both sides can be more easily reached. But it is also settled law that where the negotiations conducted without prejudice lead to a settlement, then the letters become admissible in evidence of the terms of the agreement, unless of course the agreement has become incorporated in another document which would then be the evidence of the agreement.”. [11] It is clear that the two letters are letters written on a without prejudice basis in the course of negotiating the renewal of the tenancy. Therefore, 5 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal this Court agrees with the Plaintiff’s contention that the law is trite and the letters are privileged and should not be admitted as an evidence. Enclosure 8 and Enclosure 10 [12] The Defendant seek to strike out the Plaintiff’s claim and obtained a summary judgement for its counterclaim. [13] Generally, the Defendant’s counterclaim is for a declaration that the tenancy will come to an end on the 31.1.2024 with no option to renew the tenancy beyond 31.1.2024 and that the Plaintiff shall deliver vacant possession to the Defendant on or before 31.1.2024. [14] The principle for striking out of pleadings pursuant to O 18 r 19 of the ROC is well settled (Bandar Builder Sdn Bhd & Ors v. United Malayan Banking Corporation Bhd [1993] 1 MLRA 611; [1993] 3 MLJ 36; [1993] 4 CLJ 7; [1993] 2 AMR 1969, Sim Kie Choon v. Superintendent of Pudu Prison & Ors [1985] 1 MLRA 167; [1985] 2 MLJ 385; [1985] CLJ (Rep) 293, Middy Industries Sdn Bhd & Ors v. Arensi Marley (M) Sdn Bhd [2013] 3 MLRA 114; [2013] 3 MLJ 511 and Gasing Heights Sdn Bhd v. Aloyah bte Abd Rahman & Ors [1996] 2 MLRH 631; [1996] 3 MLJ 259; [1996] 3 CLJ 695; [1996] 3 AMR 3000). 6 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal [15] Further, in Serac Asia Sdn Bhd v. Sepakat Insurance Brokers Sdn Bhd [2013] 5 MLRA 175; [2013] 5 MLJ 1; [2013] 6 CLJ 673; [2013] 4 AMR 385 (FC), it was held that ‘where the claim on the face of it is obviously unsustainable, the claim should be struck out’. [16] In regards to the counterclaim, it was filed pursuant to Order 14 Rule 5 ROC which states the following: “(1) Where a defendant to an action begun by writ has served a counterclaim on the plaintiff, then, subject to paragraph (3), the defendant may, on the ground that the plaintiff has no defence to a claim made in the counterclaim, or to a particular part of such a claim, apply to the Court for judgment against the plaintiff on that claim or part. (2) Rules 2, 3 and 4 shall apply in relation to an application under this rule as they apply in relation to an application under rule 1 but with the following modifications: (a) references to the plaintiff and defendant shall be construed as references to the defendant and plaintiff respectively; (b) the words “any counterclaim made or raised by the defendant in” in rule 3(2) shall be omitted; and (c) the references in rule 4(3) to the action shall be construed as a reference to the counterclaim to which the application under this rule relates.” 7 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal [17] The law on summary judgment is trite. The well-established legal principles applicable to applications for summary judgment have been clearly and expressly deliberated as provided by statutory provisions and decided cases. It is only in plain and obvious cases that recourse should be given to summary process under Order 14 rule 1 of the ROC 2012. The Plaintiff must satisfy the primary requirements in an application for a summary judgment. (see also the cases of Gunung Bayu Sdn Bhd v Syarikat Pembinaan Perlis Sdn Bhd [1987] 2 MLJ 332, United Malayan Banking Corporation Bhd v Palm & Vegetable Oils (M) Sdn Bhd [1983] 1 MLJ 206, Percetakan Solai Sdn Bhd v Kin Kwok Daily News Sdn Bhd & Anor [1986] 1 MLJ 240 and Doshi v. Yeoh Tiong Lay [1975] 1 MLJ 85; just to name a few) [18] In the case of Citibank NA v. Ooi Boon Leong & 2 Ors [1981] 1 MLJ 282, the Federal Court held that “where all the issues are clear and the matter in substance can be decided once and for all without going to trial there is no reason why the Assistant Registrar or the judge in chambers, or, for that matter this court, shall not deal with the whole matter under the R.S.C Order 14 procedure.”. [19] The preconditions for the application of summary judgment were stated in the case of National Company for Foreign Trade v Kayu Raya 8 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal Sdn. Bhd. [1984] 2 MLJ 300; [1984] 2 CLJ 220. The Federal Court held that: “For the purposes of an application under Order 14 the preliminary requirements are i. The defendant must have entered an appearance; ii. The statement of claim must have been served on the defendant, and; iii. The affidavit in support of the application must comply with the requirements of Rule 2 of the Order 14.”. [20] The Federal Court also held that: “[9] If the plaintiff fails to satisfy either of these considerations, the summons may be dismissed. If however, these considerations are satisfied, the plaintiff will have established a prima facie case and he comes entitled to judgment. The burden then shifts to the defendant to satisfy the Court why judgment should not be given against him [see O 14 r 3 and 4(1)].”. [21] This Court finds that the Defendant has fulfilled the preliminary requirements whereas the counterclaim has been served and affidavit sworn in compliance with Order 14 Rule 2 (See National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300). Consequently, the Defendant has established a prima facie case and entitled to a 9 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal summary judgment. [22] The burden then shifts to the Plaintiff to proof any triable issue that ought to be set down for trial for the counterclaim (Cempaka Finance Bhd v Ho Lai Ying (trading as KH Trading) & Anor [2006] 2 MLJ 685, South East Asia Insurance Berhad v. Kerajaan Malaysia [1998] 1 AMR 657). What constitute a triable issue will depend on the facts or the law arising from each case as disclosed in evidence before the Court (Bank Negara Malaysia v. Mohd Ismail & Ors [1992] 1 MLJ 400). [23] In the case of Bank Negara Malaysia v Mohd Ismail & Ors [1992] 1 MLJ 400, the Supreme Court held: “In our view, basic to the application of all those legal propositions, is the requirement under O 14 for the court to be satisfied on affidavit evidence that the defence has not only raised an issue but also that the said issue is triable. The determination of whether an issue is or is not triable must necessarily depend on the facts or the law arising from each case as disclosed in the affidavit evidence before the court … Under an O 14 application, the duty of a judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other in an affidavit. Where such assertion, denial or dispute is equivocal, or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable in itself, then the judge has a duty to reject such assertion or denial, thereby 10 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal rendering the issue not triable. In our opinion, unless this principle is adhered to, a judge is in no position to exercise his discretion judicially in an O 14 application. Thus, apart from identifying the issues of fact or law, the court must go one step further and determine whether they are triable. This principle is sometimes expressed by the statement that a complete defence need not be shown. The defence set up need only show that there is a triable issue. Where the issue raised is solely a question of law without reference to any facts or where the facts are clear and undisputed, the court should exercise its duty under O 14. If the legal point is understood and the court is satisfied that it is unarguable, the court is not prevented from granting a summary judgment merely because ‘the question of law is at first blush of some complexity and therefore takes a little longer to understand’. (See Cow v Casey 6 and European Asian Bank AG v Punjab & Sind Bank 7 at p 516.)” [24] This Court finds that the maximum renewal terms under the Tenancy Agreement is only up to the seventh term and the tenancy of the Demised Premises has expired on 31.01.2024. Clause 2.2 of the Tenancy Agreement is worded in a clear and unambiguous terms in that the aggregate period of the First Term up to the Seventh Term is only for twenty years. [25] There was no evidence of any agreement between the Defendant and the Plaintiff for the tenancy of the Demised Premises after the Tenancy Agreement lapsed on 31.01.2024. There was also no consensus 11 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal ad idem between the Defendant and the Plaintiff to further renew or extend the term of the tenancy beyond the agreed terms under the Tenancy Agreement, or to enter into a fresh tenancy in respect thereof. [26] This Court agrees with the Defendant’s contention when citing the Court of Appeal case of AmTrustee Bhd v The Store (M) Sdn Bhd [2019] 5 MLJ 253 which is quite similar to the factual matrix in this case, where it was held- “[36] On this issue, learned counsel for the plaintiff supported the learned judge’s reasoning and on the other hand learned counsel for the defendant disputed it. In considering the issue, we have looked at the evidence adduced by the parties and we found that the learned judge is plainly wrong as there is clearly no consensus ad idem between plaintiff and defendant to renew the tenancy agreements without any rental increment based on the following facts: (a) …; (b) … Subsequently, the defendant was negotiating with plaintiff on the renewal particularly on the prospect of the signing of a new tenancy agreement by plaintiff wherein defendant would then impose only 8% increment which is why defendant continue to impose old rental during this period; (c) … ; and 12 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal (d) the plaintiff, however, took the position that the tenancy agreements were renewed automatically with no rental increment. This position is detrimental to the defendant and is a blatant disregard of the defendant’s rights under the tenancy agreements. This eventually led to the termination of the tenancy agreements by the defendant in which the defendant clearly entitled to do so. [38] Accordingly, it is wrong for the plaintiff to argue that the same can be automatically renewed with no increment or with no regard as to how much the increment rate would be. [39] This court had decided in Wisma Sime Darby Sdn Bhd v Wilson Parking (M) Sdn Bhd [1996] 2 MLJ 81 where His Lordship VC George JCA said that: The question is whether there was a concluded agreement. If no agreement had been arrived at on that most crucial element of the agreement — rent — there cannot be said to be a concluded agreement. That the parties might eventually agree on the rent does not make for a concluded agreement. The question ‘what if they never arrive at an agreement as to the new rent?’ brings home the lack of merit in the submission.” (Emphasis Added) 13 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal [27] It was apparent from the facts that the parties have never reached into an agreement to renew or extend the tenancy of the Demised Premises beyond its expiry of 31.01.2024, a fact which was also admitted by the Plaintiff. [28] Accordingly, based on the above findings and on balance of probabilities, this Court finds that the Plaintiff’s claim is obviously unsustainable. The filing of the claim by the Plaintiff was an attempt after all efforts and negotiations failed to secure the tenancy of the Demised Premises. It is evident that the Plaintiff’s claim does not disclose any reasonable cause of action, frivolous, vexatious and an abuse of the process of the Court, thus warrant the condition for striking out. [29] The Plaintiff has also failed to raise any triable issue on the Defendant’s counterclaim. Therefore, this Court finds that there is no triable issue that could be considered for a full trial as this a straight forward matter. CONCLUSION [30] Consequently, after careful scrutiny and judicious consideration of all the evidence before this Court, including the written and oral 14 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal submissions of both parties, this Court allows Enclosure 8, 10 and 47 with cost. (Y.A. DR. SUZANA BINTI MUHAMAD SAID) Judicial Commissioner of the High Court NCVC 1 Kuala Lumpur Court Dated: 20 April 2024 COUNSELS For the Plaintiff Messrs Shui-Tai, Entrance 2, Suite 1308, 13th Floor Block A, Damansara Intan No. 1, Jalan SS 20/27 47400 Petaling Jaya, Selangor. 15 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal For the Defendant Messrs Ho, Loke & Koh A-1-1, Megan Avenue 1 189, Jalan Tun Razak 50400 Kuala Lumpur Encl. 8 is allowed with cost of RM 5,000.00 subject to allocator's fee. Encl. 10 is allowed with cost of RM 5,000.00 subject to allocator's fee. Encl. 13 is dismissed with cost of RM 5,000.00 subject to allocator's fee. 16 S/N AxoMcwZP406WsJuPnhtzg **Note : Serial number will be used to verify the originality of this document via eFILING portal