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Issue #30/2022
28 July 2022
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CASE(S) OF THE WEEK
NG MIN LIN v. 2HAMPSHIRE MANAGEMENT CORPORATION [2022] 7 CLJ 109 The word 'may' under s. 78(2) of the Strata Management Act 2013 ('SMA') gives a management corporation the option to either commence an action against a defaulted proprietor or to resort to the mechanism stated in s. 79 of the SMA or any other mechanisms; Section 78(2) provides the management corporations discretion. The filing of a summons in court is not a mandatory mechanism. Hence, the act of executing the mechanism stated in para. 6 of the Third Schedule of the Strata Management (Maintenance and Management) Regulations 2015 by the management corporation, is not wrong or irregular. LAND LAW: Management corporation - Service charges - Demand for payment of outstanding service charges - Proprietor failed to settle outstanding sum - Management corporation blocked all lift access cards to unit and barred proprietor and/or proprietor's tenant from using common facilities - Proprietor lost tenant/tenancy - Whether lifts were common facilities - Whether management corporation had right to prevent proprietor and/or proprietor's tenant from accessing lifts - Whether there was unlawful possession of unit by management corporation - Whether management corporation should have exhausted all other legal remedies - Whether proprietor could claim for loss of tenancy - Strata Management Act 2013, s. 78 JUDICIAL QUOTES“Section 2 of the Evidence Act does not expressly state that the Act does not apply to proceedings before the Special Commissioners of Income Tax (SCIT). However, the SCIT, similar to an arbitral tribunal, is an inferior tribunal; it is not a court. Hence, it follows that the Evidence Act also does not apply to proceedings before the SCIT. As the Evidence Act does not apply to proceedings before the SCIT, it follows that provisions relating to the examination of witnesses, including cross-examination, in the Evidence Act as well as case law on examination of witnesses do not apply to hearings before the SCIT.” - per Faizah Jamaludin J in Idaman Pelita Sdn Bhd v. Ketua Pengarah Hasil Dalam Negeri [2022] 4 CLJ 744 APPEAL UPDATES
LATEST CASESLegal Network Series
CLJ 2022 Volume 6 (Part 5) Sale and distribution of parallel imports of infringing products would create confusion amongst the consumers and therefore, constitutes trade mark infringement. In this case, the defence of parallel importation raised under s. 40(1)(dd) of the Trade Marks Act 1967 failed when the court held that there was absence of authority or consent, whether express or implied, from the registered proprietor of the trade mark or the authorised distributor of the products. The products imported, by the imprints on its labels, showed that it was restricted for China market and not meant for Malaysian market. Labelling requirements under the Food Regulations 1985 must be strictly adhered to as there are also halal requirements which cater for the majority Muslim market in Malaysia. INTELLECTUAL PROPERTY
INTELLECTUAL PROPERTY: Trade mark - Infringement - Allegation of unauthorised resale of products meant for China market - Whether authority or consent obtained from registered proprietor of trade mark or authorised distributor of products - Whether affiliation between parties established for consent to be implied - Whether consent could be implied from bulk purchase of goods - Whether restriction imprinted on packaging implied that goods only for sale in China - Whether defence of parallel importation available - Whether sale and distribution of parallel imports of infringing products would create confusion - Whether labelling requirements under Food Regulations 1985 complied with - Whether there was exhaustion of trade mark rights - Trade Marks Act 1967, ss. 35(1) & 40(1)(dd)
ABANG ISKANDAR CJ (SABAH & SARAWAK)
The underlying purpose of s. 540(1) of the Companies Act 2016 is to impose a personal responsibility and liability on the director and/or the person who controls the company and not the company itself for carrying on the business of the company with intent to defraud a creditor. The word 'person' in s. 540(1) in its ordinary and natural meaning means 'a real person.' He could be a director, managing director or person in control of the company. Therefore, to give effect to s. 540(1), the court must apply the ordinary meaning of 'person'. It does not include a company. COMPANY LAW | CIVIL PROCEDURE | WORDS & PHRASES
COMPANY LAW: Fraudulent trading - Intent to defraud - Allegation of - Claim for declarations that fraud or fraudulent scheme under s. 540 of Companies Act 2016 was perpetrated to evade paying debts - Whether company 'person' under s. 540(1) of Companies Act 2016 - Whether director could be sued despite not being director of company allegedly carrying on business with intent to defraud - Whether s. 540(3) of Companies Act 2016 applicable - Whether there was cause of action - Whether there was sufficient evidence to bring case under s. 540(1) of Companies Act 2016 against company and director - Whether claim obviously and plainly unsustainable CIVIL PROCEDURE: Striking out - Application for - Application to strike out writ of summons and statement of claim - Claim for declarations that fraud or fraudulent scheme under s. 540 of Companies Act 2016 was perpetrated to evade paying debts - Whether claim disclosed reasonable cause of action - Whether claim obviously and plainly unsustainable - Rules of Court 2012, O. 18 r. 19(1)(a), (b), (c), (d) WORDS & PHRASES: 'person' - Companies Act 2016, s. 540(1) - Whether to apply ordinary meaning of 'person' - Whether meant 'a real person' - Whether include a company - Whether s. 3 of Interpretation Acts 1948 and 1967 could be read into s. 540(1) of Companies Act 2016 - Purpose of s. 540(1) - Whether to impose personal responsibility and liability on director/person who controls company and not company itself for carrying on business with intent to defraud creditor KAMALUDIN MD SAID JCA
The Magistrate's Court has no jurisdiction to grant declaratory relief as its jurisdiction is merely to decide all actions and suits where the amount in dispute or value of the subject matter does not exceed RM1,000. However, where the plaintiff, besides asking for declaratory relief, is also suing for monetary sums well within the Magistrate's Court jurisdiction, the Magistrate's Court should not strike out the whole suit, especially when the monetary claims were not, on the face of it, obviously unsustainable. CIVIL PROCEDURE
CIVIL PROCEDURE: Jurisdiction - Magistrate - Powers to grant declaratory relief - Whether only Sessions Court Judge empowered to grant declaratory relief - Subordinate Courts Act 1948, ss. 65, 90 CIVIL PROCEDURE: Statement of claim - Addition of declaratory relief - Whether Magistrate's Court has jurisdiction to grant declaratory relief - Whether monetary claims obviously unsustainable - Whether Magistrate wrong to strike out whole suit - Whether court empowered to strike out 'anything in any pleading' - Rules of Court 2012, O. 18 r. 19(1) CIVIL PROCEDURE: Striking out - Appeal against - Appeal against Magistrate's Court decision to dismiss suit - Whether Magistrate's Court had jurisdiction to grant declaratory relief - Whether monetary claims obviously unsustainable - Whether Magistrate wrong to strike out whole suit - Whether court empowered to strike out 'anything in any pleading' - Rules of Court 2012, O. 18 r. 19(1)
LEONG WAI HONG JC
Case laws are replete with decisions that the courts are not seized with the power, in civil proceedings, to compel adults to produce deoxyribonucleic acid ('DNA') samples to prove the paternity of a child. However, it has never been discussed nor decided whether the courts could order for a child to undergo a DNA test to determine the child's paternity. In this distinctive judgment, a prima facie case was established as there was an avalanche of evidence that there existed sexual relations during the conception period of the child, between parties engaging in an extra-marital affair. Also present were overwhelming documentary evidence of an intimate relationship akin to that of a family unit. As it was in the best interest of the child to know her biological father, the child was accordingly ordered to undergo a DNA test to conclusively resolve the ambiguity as to her paternity. FAMILY LAW
FAMILY LAW: Children - Paternity - Determination of biological father of child - Claim by third party man to be biological father of child conceived during marriage of husband and wife - Whether prima facie case established - Whether there was sexual intercourse between wife and man before her marriage to her husband and during her marriage - Whether sexual intercourse took place between wife and man during conception period of child - Whether man had access to child after child's birth - Whether man provided maintenance for child - Whether court seized with power to order DNA test on child to determine paternity - Whether court ought to order child to undergo DNA test
FAIZAH JAMALUDIN J
When the cause of action in a second suit is independent of the contractual claim in a first suit, and that res judicata and issue estoppel does not apply as the facts between the two suits are not the same, the court is not persuaded to summarily strike out the second suit. Opportunity should be given to the claimant to prove his case in a trial, especially when the claim is premised on different facts and issues and is not obviously unsustainable. CIVIL PROCEDURE
CIVIL PROCEDURE: Striking out - Application for - Application to strike out second suit - Second suit based on s. 540(1) of Companies Act 2016 - Whether director of company could be made liable for company's breach of contract - Privity of contract - Doctrine of res judicata and issue estoppel - Whether applicable - Whether plain and obvious case to be struck out - Whether claim obviously unsustainable - Rules of Court 2012, O. 18 r. 19
KENNETH ST JAMES JC
An administrator of an estate owes specific duties to the beneficiaries of the estate to act in accordance with the terms of the will, set against the backdrop of a general duty to act with impartiality in the best interests of the beneficiaries. The duty of an administrator of an estate includes providing a proper, complete and accurate justification and documentation for his actions as trustee. Once it is established that the administration of the estate was undertaken, not in accordance with the terms of the will, but solely according to the administrator's personal views, bias and personal grievances against the beneficiaries, the court has sufficient cause to remove the administrator and appoint another. SUCCESSION
SUCCESSION: Administration of estate - Administrator - Beneficiary of estate sought for accounts of estate and investigation be undertaken into its affairs - Whether administrator had been administering estate in accordance with duties as administrator appointed by court - Whether administrator complied with terms of will - Whether administrator acted in best interest of beneficiaries - Whether court could administer estate - Whether administrator ought to be removed - Probate and Administration Act 1959
MOHD ARIEF EMRAN ARIFIN JC
CLJ 2022 Volume 6 (Part 6) An appeal arising from a land reference is limited to questions of law and any issue that touches on compensation is not appealable. Therefore, any issues, dressed up as questions of law but are in pith and substance, appeals on compensation, are precluded by virtue of the proviso to s. 49(1) of the Land Acquisition Act 1960. Hence, this appeal, wherein the issue was plainly related to compensation, ought to be dismissed. LAND LAW
LAND LAW: Acquisition of land - Compensation - Acquisition of part of land separated by presence of highway - Whether caused negative effect to open market value of unacquired land - Severance compensation - Quantum of severance compensation - Whether High Court evaluated diminution in value of land - Whether award of minimal amount of severance compensation fair and reasonable LAND LAW: Acquisition of land - Land reference - Appeal against - Whether appeal involved question of law - Whether issues related to compensation - Whether appeals on compensation precluded by proviso to s. 49(1) of Land Acquisition Act 1960
AZIZAH NAWAWI JCA
Equality before the law is a dynamic concept, in that, the law would treat like cases alike and unlike cases differently, ie, there must be 'reasonable' or 'permissible' classification founded on 'intelligible differentia'. In this light, in a case involving a person with disability, as in this case, mental disability having set in after the cause of action has arisen, s. 24 the Limitation Act 1953 does not provide for a suspension of the limitation period; the action was thus barred by limitation. The limitation period is suspended only if the person suing was already under disability when the cause of action arose. Section 24, therefore, treats like cases alike and unlike cases differently. And, where the cases are not covered by s. 24, the normal limitation period would apply. LIMITATION | MENTAL DISORDERS AND TREATMENT
LIMITATION: Cause of action - Accrual of - Mentally disabled person - Appointment of committee - Family members appointed to manage affairs - Action for amount due under share sale agreement - Whether disability already set in when cause of action arose - Whether s. 24 of Limitation Act 1953 applicable only where disability has set in before cause of action arose - Whether limitation period could be suspended if cause of action arose before disability set in - Whether Limitation Act 1953 in conflict with Federal Constitution - Whether action barred by limitation MENTAL DISORDERS AND TREATMENT: Appointment of committee - Mentally disabled person - Family members appointed to manage affairs - Action for amount due under share sale agreement - Whether disability already set in when cause of action arose - Whether Limitation Act 1953 provides for suspension of limitation period in instances where cause of action arose before disability set in - Whether action barred by limitation
LEE SWEE SENG JCA
(i) As the tax imposed on the compensation of the appellant's compulsorily acquired land was in accordance with s. 4C of the Income Tax Act 1967, a Federal law enacted by the Legislature, the taxing could not be said to be ultra vires the Federal Constitution ('FC'). Article 13(2) of the FC does not restrict the legislative powers of Parliament but merely requires adequate compensation to be awarded for compulsory acquisition of land; (ii) The appellant's contention, that its land compulsorily acquired by the Selangor State Government was not stock in trade under s. 4C or s. 24(1)(aa) of the Income Tax Act 1967, involved assessment and determination of material facts. The judge of facts was clearly the Special Commissioners of Income Tax, not the High Court Judge in a judicial review application. ADMINISTRATIVE LAW | LAND LAW | REVENUE LAW
ADMINISTRATIVE LAW: Judicial review - Appeal for - Application for judicial review to quash notice of assessment issued by Director-General of Inland Revenue - Whether s. 4C of Income Tax Act 1967 constitutional - Whether in contravention of art. 13(2) of Federal Constitution - Whether alternative remedy of appeal to Special Commissioners of Income Tax under s. 99(1) of Income Tax Act 1967 could be bypassed - Whether compulsorily acquired land stock in trade as envisaged under ss. 4C and 24(1)(aa) of Income Tax Act 1967 LAND LAW: Acquisition of land - Award of compensation - Application for judicial review to quash notice of assessment issued by Director-General of Inland Revenue - Whether s. 4C of Income Tax Act 1967 constitutional - Whether in contravention of art. 13(2) of Federal Constitution - Whether alternative remedy of appeal to Special Commissioners of Income Tax under s. 99(1) of Income Tax Act 1967 could be bypassed - Whether compulsorily acquired land stock in trade as envisaged under ss. 4C and 24(1)(aa) of Income Tax Act 1967 REVENUE LAW: Income tax - Notice of assessment - Application for judicial review to quash notice of assessment issued by Director-General of Inland Revenue - Whether s. 4C of Income Tax Act 1967 constitutional - Whether in contravention of art. 13(2) of Federal Constitution - Whether alternative remedy of appeal to Special Commissioners of Income Tax under s. 99(1) of Income Tax Act 1967 could be bypassed - Whether compulsorily acquired land stock in trade as envisaged under ss. 4C and 24(1)(aa) of Income Tax Act 1967 YAACOB MD SAM JCA
The legal duty to carry out an anti-dumping investigation is cast on the Ministry of International Trade and Industry ('MITI') alone. Even if, on the surface, MITI seems to be a judge on its own cause, the validity of the decision could not be challenged merely on this ground alone. The anti-dumping duties in this case were imposed after an objective investigation had been undertaken and there was nothing before the court to show that the decision was swayed by any influence. ADMINISTRATIVE LAW
ADMINISTRATIVE LAW: Judicial review - Certiorari - Application for - Imposition of anti-dumping duties at rate of 3.62% on steel reinforcing bar products - Application by Turkish company to quash decision - Whether there was breach of natural justice - Whether there was real danger of bias - Whether decision ultra vires, illegal, irrational and unreasonable - Whether there were calculation errors in regard to anti-dumping duties - Whether investigation authority's findings on injury and causal link supported or justified decision reached - Countervailing and Anti-Dumping Duties Act 1993
NOORIN BADARUDDIN J
When a party's real or predominant purpose in bringing an action is not to obtain genuine redress for its grievances but is for some other insidious collateral purpose, it has fulfilled the element of a tort of abuse of process. A wronged party is therefore entitled to compensatory damages if it has proved, on a balance of probabilities, that it had suffered losses caused by the tort perpetrated by the other party. TORT
TORT: Abuse of process - Elements of - Whether fulfilled - Whether process complained of had been initiated - Whether predominant purpose of action to obtain genuine redress for its grievances or for some other insidious purpose - Whether collateral purpose proved - Whether wronged party suffered damage or injury - Whether wronged party entitled to compensatory damages - Whether loss suffered proved on balance of probabilities TORT: Damages - General and special damages - Claim for - Whether wronged party suffered damage or injury - Whether wronged party entitled to compensatory damages - Whether loss suffered proved on balance of probabilities
JULIE LACK JC
The constitutional question sought to be referred to the Federal Court ie, whether art. 14A of the State Constitution of Penang was void for being inconsistent with art. 10(c) of the Federal Constitution ('FC'), did not only concern art. 10(1)(c) of the FC but also an interpretation of arts. 10(2)(c), 48(6), 71(4), Part 1 in the Eighth Schedule and basic foundational principles in the FC and State Constitution. A validity of a law is being challenged on the ground that the State Legislative Assembly had legislated on a matter on which it had no power to make laws. The constitutional question sought to be referred have a direct bearing to the matter of dispute and the decision of the Federal Court has the effect of finality. The basic requirements of s. 84 of the Courts of Judicature Act 1964 and art. 128 of the Federal Constitution were deemed fulfilled. CONSTITUTIONAL LAW
CONSTITUTIONAL LAW: Legislation - Constitutionality - Constitutional issues - Referring question of law to Federal Court - Whether art. 14A of State Constitution of Penang void for being inconsistent with art. 10(c) of Federal Constitution - Challenge of validity of law - Whether constitutional question sought to be referred have direct bearing on matter of dispute - Whether requirements of s. 84 of Courts of Judicature Act 1964 and art. 128 of Federal Constitution fulfilled CONSTITUTIONAL LAW: Courts - Federal Court - Constitutional issues - Referring question of law to Federal Court - Whether art. 14A of State Constitution of Penang void for being inconsistent with art. 10(c) of Federal Constitution - Challenge of validity of law - Whether constitutional question sought to be referred have direct bearing on matter of dispute - Whether requirements of s. 84 of Courts of Judicature Act 1964 and art. 128 of Federal Constitution fulfilled
AZIZAN MD ARSHAD JC
Section 35(1) of the Partnership Act 1961 provides that a partnership dissolves upon the death of a partner except where there is an agreement to the contrary entered into by the partners before the death of any partner. If such agreement exists, only the surviving partners could continue the partnership. In a situation where there is only one surviving partner, such as in the instant appeal, the partnership could not continue. The only one and surviving partner is incapable of continuing the existing partnership as a 'partnership' is an association of two or more persons carrying on business in common with a view of profit. PARTNERSHIP
PARTNERSHIP: Dissolution - Death - Partnership comprising two people - One partner passed away - Allegation that daughter of deceased took over deceased's position and entered into partnership with existing partner - Whether partnership dissolved upon death of deceased - Whether partnership carried on between existing partner and deceased's daughter - Partnership Act 1961, s. 35(1)
AMARJEET SINGH SERJIT SINGH J
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