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TAN TIEN SENG
V. GROBINA RESORTS SDN BHD
HIGH COURT MALAYA, MELAKA
[ORIGINATING SUMMONS NO. 24-537-2000]
LOW HOP BING J
23 JUNE 2006
JUDGMENT
Low Hop Bing J:
Application
This is the defendant's application in encl (56) for an order that execution
of the judgment of the court delivered on 14 July 2005 ("the judgment") be
stayed until the disposal of the defendant's appeal by the Court of Appeal.
The Judgment
After a full trial, I gave judgment for the plaintiff in the following
terms:
(a) A declaration
that the defendant is in breach of the sale and purchase agreement dated 3
January 1995 executed between the plaintiffs and the defendant ("the SPA")
in respect of the property known as Parcel No. 16-01 of No. 01-Pent 7 ("the
unit") in Tanjung Samudera Kondominium Beach Resort ("the Condo Project");
(b) A declaration that the plaintiffs have effectively rescinded the SPA in
respect of the unit ab initio;
(c) An order for repayment by the defendant of:
(i) RM844,443
being the purchase price of the unit;
(ii) RM8,800.62 being the sum of all deposits, charges and property tax
paid by the plaintiffs in respect of the unit; and
(iii) S$650 being the legal fees paid by the plaintiffs in respect of
the SPA for the unit;
(d) General
damages;
(e) Interest on all sums payable by the defendant at the rate of 8%p.a. from
7 March 2000 until realisation;
(f) Costs; and
(g) A declaration that the plaintiffs are entitled to a lien on the unit for
the said purchase price, damages, interest and costs recovered by the
plaintiffs in this action. (See Tan Tien Seng v. Grobina Resorts Sdn Bhd
(No. 2) [2005] 7 CLJ 70).
Defendant's
Grounds
The defendant's affidavit in support advanced the following grounds:
(1) The defendant
has a good arguable case in the appeal as the defence based on the
plaintiffs' acquiescence, waiver and election and s. 40 of the Contracts Act
1950 was not given any consideration ("Ground 1");
(2) The defendant agrees and undertakes to deposit with the High Court some
of the unencumbered strata titles of the condominium units from which the
plaintiffs purchased their unit to satisfy the order ("Ground 2");
(3) Execution of the judgment would "kill off" the defendant as a going
concern which is currently undertaking some housing development projects in
Melaka which have been approved by the appropriate authorities and the
construction and development works are currently intensively underway
("Ground 3");
(4) The plaintiffs would not be prejudiced since interest continues to run
on the judgment sum ("Ground 4"); and
(5) In the event the defendant's appeal to the Court of Appeal is
successful, payment of the judgment sum to the plaintiffs as Singapore
citizens would render it extremely difficult and costly to get the refund
from the plaintiffs ("Ground 5").
Special
Circumstances
Mr. FH D'Cruz, assisted by Mr BP Yap, relied on Kosma Palm Oil Mill Sdn Bhd
& Ors v. Koperasi Serbausaha Makmur Bhd [2003] 4 CLJ 1 FC ("Kosma") to
support their contention that the above grounds constitute special
circumstances.
Miss Claudia Cheah Pek Yee (Miss Sharon Tan Geok Bee with her) objected
and submitted for the plaintiffs that the defendant has failed to establish
special circumstances.
In my view, the principles governing the grant or refusal of a stay of
execution of judgment have gone through thorough judicial consideration. It
is now trite law that in an application for stay of execution of judgment
(including stay of proceedings), it is incumbent upon the applicant to show
special circumstances: Serangoon Garden Estate Ltd v. Ang Keng [1953] 1 LNS
98; [1953] MLJ 116 HC; Ming Ann Holdings Sdn Bhd v. Danaharta Urus Sdn Bhd
[2002] 3 CLJ 380 CA; and Kosma, supra, which appears to have overruled the
decision to the contrary effect in See Teow Guan & Ors. v. Kian Joo Holdings
Sdn. Bhd. & Ors. [1997] 2 CLJ 299.
Kosma supra, was followed recently by the Court of Appeal in Rowstead
Systems Sdn Bhd v. Bumicrystal Technology (M) Sdn Bhd [2005] 2 CLJ 465 CA
per Azmel Maamor J (now JCA).
[8] What constitutes special circumstances is a question of fact in each
individual case. A special circumstance must be something distinctive and
out of the way: Wu Shu Chen (sole executrix of the estate of Goh Keng How,
deceased) v. Raja Zainal Abidin bin Raja Hussin & Anor [1996] 2 CLJ 353 per
Abdul Malik Ishak J.
Special circumstances ... must be special under the circumstances as
distinguished from ordinary circumstances ... Something that exceeds or
excels in some way that which is usual or common.": Mallal's Supreme Court
Practice at p 573, referred to by Abdul Hamid Mohamad JCA (now FCJ) at p 392
in Ming Ann Holdings, supra.
In Government of Malaysia v. Datuk Haji Kadir Mohamad Mastan and another
application [1993] 3 MLJ 514 at p 521 Ian Chin JC (now J) explained that the
answer to what constitutes special circumstances is to be ascertained by way
of an exercise of discretion having regard to established judicial
principles and the facts of each case, and that there are myriad
circumstances that could constitute special circumstances with each case
depending on its own facts and that the list of factors constituting special
circumstances is infinite and could grow with time.
Having stated the above principles, I shall now consider the aforesaid
grounds.
Ground 1: Good
Arguable Case In The Appeal
The defendant's pending appeal and the mere filing of an appeal to the Court
of Appeal could not provide a reason for allowing the stay, as the
plaintiffs must not be deprived of the fruits of their litigation: per Abdul
Malik Ishak in Hariram Jayaram & Ors v. Sentul Raya Sdn Bhd (No 2) [2003] 7
CLJ 273 at pp 281 b-d, h, 283 and 284a.
Merits or strong grounds for an appeal or the validity or correctness of the
decision appealed from are not special circumstances: per NH Chan J (later
JCA) in Che Wan Development Sdn. Bhd. v. Co-operative Central Bank Bhd.
[1989] 2 CLJ 584; [1989] 1 CLJ (Rep) 366 which was followed by Abdul Malik
Ishak J in Hariram Jayaram, supra, at p 283 d-e.
In any event, I should not make a finding that the appeal is doomed to
failure, or there are merits in the appeal: see Ming Ann Holdings, supra, at
pp. 405-406 per Abdul Hamid Mohamad JCA (now FCJ). I must not be a judge of
the correctness or incorrectness of my own judgment or for that matter,
whether the defendant has a good arguable case in the appeal. That is the
exclusive jurisdiction of the Court of Appeal or the Federal Court, at the
stage of the hearing and determination of the appeal in due course (see also
Ming Ann Holdings, supra, at p 406, ibid).
Ground 2: Deposit Of Title Deeds
In the judgment, the plaintiffs have obtained inter alia an order for the
rescission of the sale and purchase agreement for the unit in the
defendant's condominium. Except for the unit which is the subject matter of
this litigation, the defendant has evinced an intention to have nothing to
do with the defendant's condominium. In my view, the deposit of the
unencumbered strata titles which have nothing to do with the unit purchased
by the plaintiffs would not serve any practical purpose. The plaintiffs'
priority is obviously to have the judgment sum satisfied by the defendant.
The defendant has not shown any intention, and I am unable to find any
evidence, that the defendant has ever endeavoured to dispose of the units in
question in order to realise the proceeds of sale to satisfy the judgment
sum, or alternatively to deposit these unencumbered titles with a bank or
financial institution by way of security for the purpose of raising the
judgment sum which in turn may be deposited in the joint solicitors' account
pending the disposal of the appeal in due course. In my view, that would be
a more appropriate and practical solution which would have taken into
consideration the mutual interest of the parties herein.
Hence, I am unable to accept Ground 2 as special circumstances.
Ground 3: The Defendant Is A Going Concern
The short answer to Ground 3 is to be found in Kosma, supra, where the
applicants highlighted the losses they would suffer if the stay was not
granted. Augustine Paul JCA (now FCJ) delivering the judgment of the Federal
Court and dismissing the application for stay, held that this line of
reasoning militated against the rationale that a stay is granted only for
reasons that relate to the enforcement of the judgment and not to give the
unsuccessful party time to satisfy the judgment or to alleviate its
problems.
It is instructive to refer to the judgment of Abdul Hamid Mohamad JCA (now
FCJ) in Ming Ann Holdings, supra. His Lordship at p 407 said:
The grounds ... are nothing more than 'fear of losing'; fear of losing
business, fear of losing customers, fear of losing supplies, fear of losing
goodwill, fear of not being able to collect its debts from third parties ...
All that the applicant has to do to avoid such 'fears' is to settle the
judgment debt.
The above judgment was affirmed in Kosma, supra.
In Zasalim Development Sdn Bhd v. Lum Siew & Sons Sdn Bhd [2002] 1 LNS
195; [2002] 7 MLJ 119, Abdul Malik Ishak J reiterated his view in Wu Shu
Chen (the sole executrix of the estate of Goh Keng How, deceased) v. Raja
Zainal Abidin bin Raja Hussin & Anor [1996] 2 CLJ 353 that a large judgment
sum of about RM26 million awarded in favour of the plaintiff did not
constitute special circumstances. Hardship and financial burden as in Lim
Kok Liam & Sons Sdn. Bhd. v. Lau Choon Wan (Leong Yok Chin Intervener)
[1996] 4 CLJ 256; and disruption of business as in Yun Hing (Sabah) Sdn Bhd
v. Sandakan Plywood & Veneers Co Sdn Bhd [1995] 1 MLJ 339, could not
constitute special circumstances.
Ground 3 gives me the prima facie impression that the defendant is a
large-scale multi-project housing developer enjoying very sound financial
health, in which case it is hardly possible for the defendant to be "killed
off" or destroyed by the defendant's satisfaction of the judgment sum which
represents a miniscule fraction of the astronomical costs of all the
defendant's projects. It must be remembered that the judgment sum reflects
the purchase price for the unit paid by the plaintiffs as purchasers to the
defendant as vendor.
[22] In my view, the defendant's fears are not special circumstances.
Ground 4: Plaintiff Not Prejudiced
I am unable to accept Ground 4 as special circumstances. It is axiomatic
that the plaintiffs as successful litigants are more concerned with the
recovery of the judgment sum and that they should not be deprived of the
fruits of the judgment obtained in their favour: Wu Shu Chen, supra; Ming
Ann Holdings, supra; and Kosma, supra.
Ground 5: Plaintiffs Are Singapore Citizens
In relation to Ground 5, although the plaintiffs are Singapore citizens
outside the jurisdiction of our courts, it is to be noted that from the
inception of this litigation in 2000 ie, some six years ago, the defendant
has never doubted the strong financial position of the plaintiffs who had
from 1994 to 1998 paid the full purchase price by cash and against whom the
defendant had never seen the need to apply for security for costs in this
civil suit.
A case directly in point is to be found in Kontiki Trading Pte Ltd v.
Protama Sdn Bhd & Ors [1998] 1 LNS 157; [1998] MLJU 415, where the plaintiff
has obtained judgment. Pending hearing of the appeal in the Court of Appeal,
the third and fourth defendants applied for a stay of execution of judgment
on the ground that the plaintiff is a company registered and based in
Singapore and that it would be extremely difficult to get back the money
paid over to the plaintiff in a place outside our jurisdiction. Tee Ah Sing
J dismissed the application as the plaintiff was, inter alia, not insolvent,
adding that there was no evidence that the foreign company was prone to
dissipating its assets and money or was facing financial difficulties.
His Lordship also applied the distinction between a default or summary
judgment and a judgment obtained after a full trial, as is the case before
me, so that the plaintiffs as successful litigants should not be deprived of
the fruits of their victory.
In my view, Ground 5 does not constitute special circumstances.
Conditional Stay
Notwithstanding the fact that none of the above grounds could constitute
special circumstances, I am mindful of balancing the respective rights of
the parties herein and maintaining the integrity of the defendant's appeal.
I am therefore prepared to consider a conditional stay as a fair, just and
equitable solution to the parties herein, having regard to the defendant's
apprehension based on the foreign element in Ground 5.
Conditional stays have been granted by me in ITG Marketing Sdn Bhd v.
Tatston Sdn Bhd & 4 Ors [2002] 1 LNS 286; and Chaw Anui v. Tan Kim Chai (No
2) [2005] 5 CLJ 171.
A similar approach in giving a conditional stay was adopted in:
(1) the English Court of Appeal through the judgment of Staughton LJ in
Wimbledon & South West Finance Company Ltd v. Everest and Another (LexisNexis,
judgment delivered on 11 July 1990);
(2) the High Court of Hong Kong in Ngan Ping Woon v. Rabobank Asia Limited
[1997] HKCU Lexis 642 by Leong J; and affirmed by Ching JA and Anthony G.
Rogers J; and
(3) our Court of Appeal in Fawziah Holdings Sdn Bhd v. Metramac Corporation
Sdn Bhd & Anor Appeal (Malaysian Bar Website, 1 March 2006).
Reverting to the application before me, I am of the view that it is fair,
just and equitable to allow a conditional stay, subject to all the following
conditions:
(1) the deposit, on or before 17 July 2006 by the defendant, of the total
judgment sum as stated in para (c)(i), (ii) and (iii) under the caption
"judgment" above, together with all interest accrued to the date of the
deposit being effected, in an interest bearing solicitors clients account
jointly held and managed by the plaintiffs' solicitors and the defendants'
solicitors;
(2) the said deposit together with all interest accrued shall not be
released save and except in compliance with an order of this court or the
Court of Appeal, pursuant to this suit or the said appeal as the case may
be; and
(3) on or before the 17th day of each month, beginning July 2006, the
defendant's solicitors shall write to the registrar of the Court of Appeal
to request for an early date of hearing for the defendant's appeal, with a
copy thereof to the plaintiffs' solicitors and the registrar of this court.
The conditional stay shall lapse upon the non-fulfilment of any of the above
conditions by the defendants and the defendant's solicitors or their
respective successors in title, as the case may be.
Conclusion
On the foregoing grounds, pursuant to the defendant's application in encl
(56), I make an order of conditional stay, subject to all the conditions as
enumerated above. Parties to bear their own costs respectively. |
