TEXAS AM MARKETING SDN BHD TECH ADVANCE INDUSTRIAL CO. LTD

IN THE HIGH COURT OF MALAYA AT PENANG IN THE STATE OF PENANG CIVIL SUIT NO: PA-22NCvC-209-12/2018 BETWEEN TEXAS AM MARKETING SDN BHD (COMPANY NO: 1221248-a) ... PLAINTIFF AND TECH ADVANCE INDUSTRIAL CO. LTD (TAIWAN COMPANY NO: 97418827 ... DEFENDANT GROUNDS OF JUDGMENT Introduction [1] The matter before this court is an application by the defendant dated 30.4.2019 (Enclosure 13) to strike out the plaintiff's suit under Order 18 r.19 (d) and/or Order 92 rule 4 of the Rules of Court 2012 for being an abuse of the process of the court. (An amendment was made orally on 12.6.2019 as enclosure 13-states that the application is :made-under Order 19 rule 19(D) of the Rules of Court 2012. [2] The prayers are for: (a)That the Writ dated 4.3.2019 and Statement of Claim dated 4.12.2019 filed by the plaintiff against the defendant be struck out. 1 (b)Costs of this application be borne by the plaintiff (c)Such further and other reliefs deemed fit and suitable by this honourable Court. [3] This application to strike out the plaintiffs suit is deliberated upon these documents: (a) the application dated 30.4.2019. (b) Afidavit Sokongan affirmed on 26.4.2019. (c) Afidavit Pembetulan Santhini a/p R Selvasingam affirmed on 8.5.2019 (d) Afidavit Jawapan Plaintif affirmed by Chow Hong Yip on 13.5.2019. (e) Afidavit Balasan Defendan terhadap Afidavit Jawapan Piaintif affirmed on 28.5.2019. (f) Afidavit Jawapan 2 Plaintif affirmed by Chow Hong Yip on 10.6.2019. [4] Upon being presented and having perused the written submissions of both parties as well as hearing further oral submissions, this court decided to allow the application on 9.10.2019. The plaintiff being dissatisfied with the decision of this court filed an appeal to the Court of Appeal hence the grounds for the said decision. Governing principles for striking out [5] The often quoted precedent of Bandar Builder Sdn Bhd & Ors v United Malayan Banking Corporation Bhd [1993] 3 MLJ 36 has laid down the relevant principles for a striking out application: [6] “it is only in plain and obvious cases that recourse should be had to the summary process under this rule...and this summary procedure can only be adopted when it can be clearly seen that a claim or answer is on the face of it ‘obviously unsustainable’...It cannot be exercised by a minute examination of the documents and facts of the case in order to see whether the party has a cause of action. The court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defenses are not arguable... It has been said that so long as the pleadings disclose some cause of action or raise some question fit to be decided by the judge, the mere fact that the case is weak and not likely to succeed at trial is no ground for the pleadings to be struck out.” In Dato’ Ahmad Zahid Hamidi v Amir Bazli Abdullah [2012] 7 CLJ 823 it was held: [7] « ..Both the claim and defence and counterclaim raise issues of fact which requires serious consideration and are capable of resolution only after taking viva voce evidence at trial by calling witnesses and cross examination of them. Accordingly, this certainly was not an appropriate case of striking out.” The Court of Appeal in Sivarasa Rasiah & Ors v Che Hamzah Che Ismail & Ors [2012] 1 CLJ 75 decided: “this court unanimously is of the view that there are a number of relevant issues that need to be tried and evidence to be adduced at 3 [8] held: [9] trial for determination of the whole claim by the appellants against the respondents. The pleadings clearly disclose some causes of action or raised some questions fit to be decided by the judge at trial, the mere fact that the case is weak and not likely to succeed at the trial is no ground for the claim to be struck out summarily under O.18 r.19 of the RHC. There are several issues of fact that are capable of resolution only after taking viva voce evidence. This obviously is not an appropriate case for striking out summarily.” In See Thong & Anor v Saw Beng Chong [2012] 1 LNS 817 it was “The power to strike out a case under the order without having to go for trial should be exercised sparingly and only in plain and obvious case. The procedure is of a summary nature. The party affected should not be deprived of his right to have his case proceeded by a proper trial unless the claim is obviously unsustainable.” The Federal Court in the case of CC Ng & Brothers Sdn Bhd v Government of State of Pahang [1985] 1 CLJ 235 held that: “The inherent power to dismiss an action summarily without permitting the plaintiff to proceed to trial is a drastic power. It should be exercised with utmost caution - per Seah J. It is a power which ought-to-be-very sparingly exercised-and-only-in-very-exceptional cases (per Lord Herschell in Lawrence v Norrey - as cited in CC Ng & Brothers) Brief facts of the case [10] Chau Chee Siang, who holds 85% of the plaintiff's shares and doing business under the name of Texas Advance Marketing (TAM) issued purchase orders to the defendant herein (Tech Advance Industrial Co Ltd - TAIC) with TAIC agreeing to sell and deliver goods ordered directly to TAM. TAIC issued invoices for the goods delivered to the sum of USD 303,343.30 which resulted in TAM failing to pay the said amount. TAM was later taken over as regards its business and accounts by the plaintiff herein, Texas Am Marketing Sdn Bhd (TAMSB). [11] Despite repeated demands towards TAM for payment, it remained unpaid and TAIC through its solicitors, issued a Notice of Demand dated 28.8.2017 for the sum to be paid within 7 days. [12] Due to non-payment from TAM, TAIC’s solicitors filed a Writ and Statement of Claim dated 15.9.2017 at the Kuala Lumpur High Court bearing the number WA-22NCvC-485-09/2017 (the said suit). Without an appearance being filed by TAM in the capacity of the defendant in the said suit, TAIC filed a Certificate of Non-Appearance dated 15.11.2017 and further on obtained a Judgment in Default (JID) against TAM dated 15.11.2017. [13] TAIC later on filed an application to amend the Writ, Statement of Claim, JID and Certificate of Non-Appearance with the application being allowed by the KL Court on 11.12.2017. A bankruptcy proceeding was then pursued by TAIC at the Penang High Court (No: PA-29NCC-8-01/2018) against TAM. TAM then filed an application to set aside the amended JID backed by an Affidavit in Support of Chau Chee Siong affirmed on 10.8.2018. [14] The application though was dismissed by the KL High Court resulting in an appeal being lodged to the Court of Appeal (No: W 02(IM)(NCvC)2031-10/2018 with the appeal Court fixing a hearing date on 22.8.2019. TAM filed an application to stay the execution of the amended JID with the Court of Appeal allowing the stay. [15] This suit was then filed by TAMSB at the Penang High Court. As regards the KL suit, at the time this application was heard by this Court the Court of Appeal has set aside the JID obtained with the matter now to proceed by way of a full hearing. Deliberations of the Court [16] The defendant herein being TAIC is arguing on the issue of duplicity being plain and obvious in seeking to strike out this suit. [17] This Court in deciding on enclosure 13 is attracted to these paragraphs in this suit’s Statement of Claim of TAMSB and the Defence of TAM in the KL suit (which is marked as exhibit F in the Defendant's afidavit sokongan which is enclosure 14): Para 3 of Statement of Claim and para 6a of Defence 3. Sejak 2014, pengarah Plaintif bernama Chau Chee Seong telah bermula dalam perhubungan perniagaan dengan Defendan di bawah satu syarikat yang dikenali sebagai Texas Advance Industrial Sdn. Bhd. (No. Syarikat: 709320-M) (“TAI”). 6a. Plaintif dan Defendan telah dalam perhubungan perniagaan sejak tahun 2014 melalui Texas Industrial Sdn. Bhd. (No. Syarikat: 709320-M) (“TAI”) di mana saya merupakan salah seorang pengarah. Para 4 of Statement of Claim and para 6b of Defence 4. Defendan merupakan rakan perniagaan bagi TAI dalam menerima pesanan pembelian dari satu Texas Instrument Inc., Philippines (“TI”) di mana Tl merupakan pelanggan TAI. TAI menerima pesanan terus daripada TI dan TAI akan meletak pesanan dengan Defendan di mana TAI akan menanggung pembayaran harga pembelian kepada Defendan. 6b. Plaintif merupakan rakan perniagaan TAI dalam menerima pesanan pembelian dari Texas Instrument Inc, Philippines (“TI”) di mana TI merupakan pelanggan TAI. TAI menerima pesanan terus daripada TI dan TAI akan meletak pesanan dengan Plaintif di mana TAI akan menanggung pembayaran harga pembelian kepada Plaintif. Para 5 of Statement of Claim and para 6c of Defence 5. Atas pertengkaran dalam Lembaga Pengarah TAI, Chau Chee Seong seterusnya telah menubuhkan satu Texas Advance Marketing untuk terus membuat pesanan pembelian kepada Defendan. 6c. Defendan seterusnya telah mendaftarkan Texas Advance Marketing untuk membuat pesanan pembelian kepada Plaintif. Para 6 of Statement of Claim-and para 6e of Defence 6. Namun sekitar Mei 2016, Defendan telah meminta kepada Chau Chee Seong tersebut supaya bersetuju kepada pihak Defendan secara terus menerima pesanan pembelian daripada Tl mula tahun 2017 di mana Defendan berjanji membayar komisyen kepada Chau Chee Seong tersebut 7 lebih kurang sebanyak 10% bagi harga jualan Defendan yang dibuat melalui pesanan pembelian daripada Tl bagi pesanan pembelian dari Januari tahun 2017 dan bahawa satu perjanjian agensi diberikan kepada Chau Chee Seong tersebut di mana Chau Chee Seong menjadi ejen kepada Defendan dan menikmati bayaran komisyen seterusnya. Chau Chee Seong tersebut telah bersetuju dengan cadangan Defendan dan percaya bahawa Defendan menepati janjinya dan membuat bayaran komisyen sepertimana yang dipersetujui kepadanya. 6e. Namun sekitar Mei 2016, Plaintif telah meminta kepada Defendan supaya bersetuju kepada pihak Plaintif terus menerima pesanan pembelian daripada TI mulai tahun 2017 di mana Plaintif membayar komisyen kepada Defendan sebanyak 10% bagi harga jualan Plaintif yang dibuat melalui pesanan pembelian daripada Tl bagi pesanan pembelian dari Januari tahun 2017 dan bahawa satu perjanjian agensi diberikan kepada Defendan. Defendan telah bersetuju dengan cadangan Plaintif dan percaya bahawa Plaintif menepati janjinya dan membuat bayaran komisyen sepertimana yang dipersetujui kepada Defendan. Para 8 and 9 of Statement of Claim and para 6f and 6g of Defence 8. Pada masa yang sama, atas sebab Defendan tidak fasin dalam Bahasa Inggeris, Defendan juga telah meminta pertolongan Chau Chee Seong tersebut supaya dapat membuat peraturan jualan inden bagi kumpulan syarikat Texas Instrument di Kuala Lumpur dan juga di China di mana Defendan telah berjanji bahawa sekiranya jualan inden telah berjaya diaturkan oleh Chau Chee Seong, Defendan akan meningkatkan komisyen sepertimana yang dinyatakan dalam perenggan 6 ini tersebut. 8 9. Chau Chee Seong telah berjaya membuat peraturan jualan inden bagi Texas Instrument di Kuala Lumpur dan China kepada Defendan sejak Oktober 2016. 6f. Pada masa yang sama, atas sebab Plaintif tidak fasin dalam Bahasa Inggeris, Plaintif juga telah meminta pertolongan Defendan supaya dapat membuat pengaturan jualan inden bagi kumpulan syarikat Texas Instrument di Kuala Lumpur dan juga di China di mana Plaintif telah menjanjikan bahawa sekiranya jualan inden telah berjaya diaturkan oleh Defendan, Plaintif akan meningkatkan komisyen sebagaimana yang dinyatakan dalam perenggan 6 (e) sini. 6g. Defendan telah berjaya membuat peraturan jualan inden bagi Texas Instrument di Kuala Lumpur dan China kepada Plaintif sejak Oktober 2016. Para 10 of Statement of Claim and para 6h of Defence 10. Sekitar Februari 2017, untuk tujuan menikmati pengecuaian cukai dan permohonan fasiliti perbankan, Chau Chee Seong tersebut telah menyusun semula perniagaan beliau dengan menubuhkan Plantif dan dilantik sebagai pengarah Plaintif di mana Plaintif telah mengambil alih kesemua perniagaan dan akaun Texas Advance Marketing di mana kesemua pemiutang dan penghutangnya, termasuk Defendan di mana Defendan tiada bantahan. 6h. Sekitar Februari 2017, untuk tujuan menikmati pengecualian cukai dan permohonan fasiliti perbankan, Defendan telah menyusun semula perniagaan Defendan dengan menubuhkan Texas AM Marketing Sdn Bhd (No. Syarikat: 1221248-A) (TAM) dimana TAM 9 telah mengambilalih kesemua perniagaan dan akaun Texas Advance Marketing di mana kesemua pemiutang dan penghutangnya, termasuk Plaintif di mana Plainntif tiada bantahan. Para 11 of Statement of claim and para 6i of Defence 11. Plaintif seterusnya dari semasa ke semasa telah menuntut bayaran komisyen seperti yang dijanji oleh Defendan dan kontrak agensi ditandatangani, namun, Defendan sehingga kini gagal, enggan dan/atau abai membalas kepada tuntutan Plaintif tersebut. 6i. Defendan bagi pihak Texas AM Marketing Sdn. Bhd. (No. Syarikat: 1221248-A) (“TAM”) terus dari semasa ke semasa telah menuntut bayaran komisyen seperti yang dipersetujui daripada Plaintif. Namun, Plaintif telah gagal enggan dan/atau abai membalas kepada tuntutan Defendan dan/atau tersebut. [18] TAMSB argues that this suit concerns a different cause of action but this Court is of the considered opinion that this is not so. It is most apparent that both documents showcase that the wordings are almost verbatim thus the conclusion that can be arrived at is this suit is a mere duplicity of the KL suit though the plaintiff argues that both suits are of different causes of actions. This argument only serves to disguise what is obvious. Both suits concern the same facts and issues which would require 2 different courts to hear-and-decide thus leading to-an-abuse of the process. of the-court. [19] The law is settled pertaining to a duplicity of proceedings. In Lai Kim Loi v Datuk Lai Fook Kim & Co [1989] 4 CLJ (Rep) 61, the Federal Court observed: 10 “On the question of multiplicity, Mr Lim had conceded that the issues raised and the reliefs sought in Suit No. S 235 of 1985 had been largely duplicated in the said petition. Although the issues raised and the relief sought are not totally similar yet we consider that the substantial duplication of issues and reliefs sought in both actions amounted to multiplicity of actions and in all circumstances of this case, the petition presented is vexatious and is an abuse of the process of the Court and ought to be struck out as the learned Judge has done and not stayed or the petition be allowed to be amended as suggested by the Counsel for the petitioner. We were satisfied that the learned Judge had exercised his discretion correctly in striking out the petition and we therefore dismissed the appeal with costs.” [20] In Wong Peng Yan Benjamin v Genting Bhd & Anor [1993] 3 MLJ 713 in referring to North West Water Ltd v Binnie and Partners (a firm) stated: “Where an issue had for all purposes been decided in a court of competent jurisdiction the court would not allow that issue to be raised in separate proceedings between different parties arising out of identical facts and dependant on the same evidence, since not only was the party seeking to relitigate the issue prevented from doing so by issue estoppel but it would also be an abuse of process to allow the issue to be relitigated...” [21] Since the KL suit which was filed much earlier would determine the same issues between the parties, this Court is of the considered opinion that having this suit is simply unnecessary in wanting to regurgitate the 11 same facts and issues. The principle of res judicata also could set in and be applicable. [22] Section 11 in the Schedule of Courts of Judicature Act 1964 has enclothed the Court with the discretion and power to strike out such proceedings: “Power to dismiss or stay proceedings where the matter in question is res judicata between the parties, or where by reason of multiplicity of proceedings in any court or courts the proceeding ought not to be continued.” [23] Based on those deliberations this Court finds it fit and appropriate to allow enclosure 13 with costs. Dated: 7 January 2020 AZMI BIN ABDULLAH High Court Judge High Court of Malaya, Penang 12 COUNSELS Counsel for the Plaintiff: S.T. Kung M/s Zamaliah Mahen & Teh Advocates and Solicitors No. S-08-02, The Setia Tri-Angel Persiaran Kelicap Sungai Ara 11900 Penang. Counsel for the Defendant: Santhini a/p R Selvasingam M/s C. L. Boo & Associates Advocates & Solicitors Suite 1607, Tingkat 16, Plaza Permata, No.6 Jalan Kampar, 50400 Penang. 13