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[CIVIL SUIT NO. 22-4-92]

20 JANUARY 1995



INJUNCTION: Ex-parte injunction - Grant of - Propriety - Whether proceedings ought to be inter-partes - Principles applicable - Plaintiffs admitted having limited financial resources - Whether injunction in plaintiffs' favour could be ordered - Consideration of American Cynamaid principles.

Hj. Abdul Malik bin Hj. Ishak J:

The defendant, a housing developer and licensed under the Housing Developers (Control and Licensing) Act, 1966 (Revised 1973) (Act 118) ("Act") , developed single storey low cost terrace houses in a housing scheme known as Taman Damai located at Jalan Kuala Kangsar, Simpang, Taiping, Perak. The defendant sold these houses at Taman Damai to the plaintiffs at varying dates between 1985 and 1986 through the standard sale and purchase agreements as set out in schedule E of the Housing Developers (Control and Licensing) Regulations, 1982(Exhibit 'A' in encl. 1B) ("standard S & P").

Only nine (9) out of the two hundred and fortyfive (245) purchasers purchased corner lots. The rest were contented with and had no choice but to take the intermediate lots. The lands were priced at RM64.50 sen per square metre and all the purchasers had to pay the same amounts. By a device hatched by the defendant, all the plaintiffs had to pay extra charges thereby inflating the price of the lands at RM129 sen per square metre. This works out to RM6,007.75 sen for each intermediate lot and making a grand total of RM1,393,682 for plaintiffs number one (1) to plaintiffs number two hundred and thirty-two (232) to pay. Likewise, purchasers/plaintiffs for corner lots had to pay an additional grand total of RM96,190.88 sen calculated at RM6,011.93 for each corner lot. In short, all these purchasers had been overcharged by RM1,489,988.88 sen by the cunning defendant.

The plaintiffs introduced by affidavit evidence that they filed three (3) originating summonses at Ipoh High Court vide S.P. No. 31-1475-87, S.P. No. 31-826-88 and S.P. No. 24-465-90 against the same defendants and all these three were eventually settled by way of consent judgments involving late delivery of vacant possessions and payments of works which were not done at all. originating summons No. 24-465-90 involved a claim exceeding RM165,000.

The plaintiffs also filed a civil suit No. 22-201-87 against the defendant and it was settled by way of a consent judgment involving RM1,116,930 (Exhibit 'E' of encl. 1B). It was averred that before the consent judgments were recorded in regard to S.P. No. 31-1475-87, S.P. No. 31-826-88 and civil suit no. 22-201-87, the defendant through its director one Saw Sing Keat had informed the Ipoh High Court that a balance of RM3 million was still due and payable from financial institutions like the Government of Malaysia and Tenaga Nasional Berhad (formerly known as Lembaga Letrik Negara) etc.

It was averred that the defendant had no other development projects in Taiping, Perak and, being a Sendirian Berhad, it had no other assets. The plaintiffs averred that they were poor and each earning between RM400 to RM500 per month and, after the necessary housing instalments which they had to service, they were left with barely enough to fend for themselves. The plaintiffs feared that if the sums of RM1,489,988.88 sen were not restrained, the defendants after paying the judgment sums in S.P. No. 31-1475-87, S.P. No. 31-826-88 and Civil suit No. 22-201-87 were left with practically nothing and, at the end of the day, the plaintiffs would be left with paper judgments only. The plaintiffs felt that secrecy was essential to prevent the defendant from running away with RM1,489,988.88 sen and sought, ex parte, for the following prayers (encl. 1A):

(a) Suatu injunksi melarang defendan daripada mengambil wang setakat jumlah RM1,489,988.88 sen daripada Tetuan Choong Yik Son & Fiona Ghaus (dahulunya dikenali sebagai Tetuan Choong Yik Son & Robiha) atau daripada Perbendaharaan (Jabatan Pinjaman Perumahan Perbendaharaan) Kuala Lumpur atau Tenaga Nasional Berhad (dahulunya dikenali sebagai Lembaga Letrik Negara) atau daripada lain-lain institusi kewangan yang telah meminjamkan wang berhubung dengan pinjaman perumahan yang diambil oleh semua pembeli-pembeli rumah dalam skim yang dikenali sebagai Taman Damai setelah penghakiman persetujuan dalam saman pemula No. 13-1475-87, saman pemula no. 31-826-88, guaman sibil No. 22-201-87 dan melainkan wang yang diperintah ditahan oleh Mahkamah ini dalam saman pemula No. 31-465- 90 sehingga tindakan ini ditamatkan atau perintah lanjut Mahkamah ini.


(b) Bahawa defendan mencatatkan dalam tempoh 14 hari selepas penyampaian perintah ini terhadap mereka, jumlah wang yang dihutang dan yang harus dibayar (due owing and payable) oleh Kerajaan Malaysia, Tenaga Nasional Berhad (dahulunya dikenali sebagai Lembaga Letrik Negera), Bank Standard Chartered atau institusi - institusi kewangan yang lain pada masa perintah persetujuan dalam saman pemula no. 1475/87, 826/88 dan guaman sibil No. 22-201- 87 dan 24-465-90 direkodkan.
(c) Kos permohonan ini dibayar oleh defendan.
(d) Relif-relif lanjutan atau relif-relif lain.

Looking at the facts as set out above, the plaintiffs as purchasers of Taman Damai were overcharged by the defendant to the tune of RM1,489,988.88 sen and now sought to injunct those sums till the disposal of Civil Suit No. 22-4-92. The position was made acute by the various consent judgments entered against the defendant involving substantial sums and the plaintiffs feared that if their applications were made inter partes the defendant might resort to underhand tactics and put the balance of RM3 million away and indirectly preventing the plaintiffs from getting back their RM1,489,988.88 sen.

On 23 September 1994, when the ex-parte application was heard in chambers, I granted the prayers sought for in encl. 1A, especially the interim injunction, and gave the return date on 5 October 1994, though this was not specifically provided for in O. 29 r. (2B) of the Rules of the High Court, 1980 ("RHC") (Lim Nyook Yin v. Ultratech Sdn. Bhd. & Anor. [1995] 1 AMR 183 ). I felt that secrecy was paramount in this case as the plaintiffs' fear could well become a reality. If the defendant was alerted in regard to the ex-parte interim injunction schedule on 23 September 1994, and, in view of the several consent judgments which the defendant must fulfil, they might probably disappear with the balance of RM3 million (see Castle Fitness Consultancy Pte. Ltd. v. Manz [1990] 1 MLJ 141 as applied in Lim Nyook Yin v. Ultratech Sdn. Bhd. & Anor.(supra)).

It was argued before me that the plaintiffs borrowed from various financial institutions including the Federal Treasury, and their ex-parte application was not directed at these financial institutions from releasing the monies but rather they were more interested in restraining the solicitors from releasing the monies to the defendant. Mr. Gurbachan Singh, Counsel for the plaintiffs, rightly pointed out that an injunction could not be granted against the Government and it was for this reason that he did not cite the Federal Treasury as a party (Government of Malaysia v. Lim Kit Siang [1988] 2 MLJ 12 SC). Clearly from the facts, there was urgency on the part of the plaintiffs to proceed ex-parte under O. 29 of the RHC as envisaged in Bates v. Lord Hailsham of St. Marylebone [1972] 3 ALL ER 1019. I may add that in the event there was no urgency and, it could be shown as such, the ex-parte interim injunction obtained could be set aside simply on that solitary ground (Png Siaw Luan v. Wong Tui San [1990] 3 MLJ 340).

Be that as it may, on the return date - this was on 5 October 1994, the defendant's Counsel appeared and mentioned on behalf of the plaintiffs' Counsel and sought an adjournment presumably to enable him to file an affidavit in reply to discharge that interim injunction. I took the liberty to extend the ex-parte interim injunction on inter partes basis as the defendant's Counsel has entered an appearance and, at that juncture, O. 29 of the RHC no longer applies to the case. A short adjournment was granted and this was on 6 October 1994, where both parties were represented and Mr. Ravindran for the defendant argued that he was served with the order of 23 September 1994, on 4 October 1994, quite late in the day, according to him. It was argued further that the interim injunction obtained on an ex-parte basis should automatically lapse at the end of two weeks from 23 September 1994, and 6 October 1994 was said to be the last day for its existence. Reliance was placed on O. 29 r. (2B) of the RHC.

Applying O. 29 r. (2B) of the RHC to the facts of the case would mean this. That the defendant's Counsel had entered an appearance on the 13th day (5 October 1994) and even on that day the interim ex-parte injunction was still valid and in existence without this Court extending it on an inter partes basis (though this was done). On the 14th day - this was on 6 October 1994, when both parties appeared and argued on the preliminary point, I could and am empowered to extend the ex-parte interim injunction inter partes for three main reasons. Firstly, to enable the defendant's Counsel to file his affidavit in reply since on 6 October 1994, he has yet to file it. Secondly, O. 92 r. 4 of the RHC gave this Court an inherent power to make such an order (Lim Nyook Yin v. Ultratech Sdn. Bhd. & Anor. (supra)). Thirdly, at that juncture, the purpose and purport of O. 29 r. (2B) of the RHC were no longer applicable.

19 October 1994 was fixed as the next date of hearing. By then the defendant had filed an affidavit in reply (encl. 6) where they stated that the price of each house was listed at RM25,000 at cl. 3 of the standard S & P and subject to any increase in the situations as envisaged in cl. 11(1) thereof. They denied totally that there were extra charges as alleged by the plaintiffs. In regard to the various claims as filed in the Ipoh High Court, they denied that these claims were related to late delivery of vacant possessions and averred that the works were carried out according to the agreements thereto. They admitted paragraphs 19 and 20 of the plaintiffs' affidavit and amplified that after fulfilling their obligations under the consent judgments, they would receive payments of RM3,116,353.20 - an amount sufficient to satisfy the plaintiffs' claim. The defendant averred further that they proposed to undertake a joint venture project with "Yayasan Pembangunan Rakyat Miskin Perak" ("Yayasan") to develop sixty (60) acres of land belonging to Yayasan into a housing scheme and in support thereof a letter dated 26 September 1994 vide Exhibit "SSK2" was annexed thereto. The defendant asserted that they have no outstanding debts with other financial institutions except in regard to the scheme at Taman Damai. In regard to the plaintiffs claim that they were poor and earning RM400 to RM500 per month, the defendant averred that such an admission was fatal because the plaintiffs were in no position to give an undertaking as to damages and that the defendant stood to incur damages if the sums of RM3,116,353 were restrained. It was averred that in the event this Court grants an injunction, the plaintiffs should deposit certain sums into Court as security for the costs and the damages that the defendant might incur. Finally, it was averred that there was an alternative remedy available apart from the equitable remedy of injunction and that the whole exercise undertaken by the plaintiffs was misconceived, frivolous, vexatious and an abuse of the process of the Court. Finally, the defendant prayed that the plaintiffs' application be dismissed with costs.

Mr. Gurbachan Singh affirmed an affidavit in reply (encl. 7) on behalf of the plaintiffs and he adverted to and adopted the plaintiffs' affidavit in encl. 1B and challenged the defendant's affidavit in encl. 6. He denied the allegations in paras. 5 and 6 of encl. 6 and alleged that the plaintiffs were overcharged as set out in the statement of claim marked "A" and annexed thereto. He averred that the plaintiffs were overcharged to the tune of RM1,489,988.88 sen and that the defendant practised discrimination in regard to the pricing of the land for an intermediate lot with that of a corner lot. He averred that there was late delivery of vacant possession and Saw Sing Kiat practised deception on this point because all the consent judgments entered between the parties were in regard to late delivery of vacant possessions. In regard to the other cases, there were extra charges for non-existent extra works designed specifically to inflate the purchase price of the houses. He averred further that the plaintiffs in the other cases obtained injunctions to restrain the monies until disposal of the suit and cited S.P. No. 31-1475-87 where Anuar J (as he then was and now the Chief Judge (Malaya)) gave an injunction to restrain the defendants from obtaining or attempting to obtain releases of the balance of the purchase price or progressive payments directly from the relevant financial institutions (Exhibit 'C' in encl. 7). He took exception to para. 10 of encl. 6 and averred that the plaintiffs were only interested to restrain RM1,489,988.99 sen and not RM3,116,353 sen as alleged. In regard to the Yayasan project it was only a proposal by the defendant to Yayasan and there was no concrete proof that the defendant had secured the project. Thus, it was clear that the defendant had no other ongoing project except Taman Damai. He averred that the plaintiffs, if directed, could afford to pay the damages incurred by the defendant, if any. Finally, he averred that there were triable issues which should be set down for hearing.

Though the defendant did not file an affidavit in reply to encl. 7, it is obvious that there are conflicts of evidence as to the facts especially that part where the defendant was said to have overcharged the plaintiffs and these can only be ironed out at the trial proper. It is also obvious that an interesting point of law exists, which calls for a decision. This is in relation to the differentiation of the prices between the intermediate and the corner lots which is said to be unlawful, improper, fraudulent and discriminatory. A decision on the question of law can only be arrived at after a full fledged trial. I am fortified, in my view, by a passage appearing in the judgment of Lord Diplock in American Cyanamid Co. v. Ethicon Ltd. [1975] 1 ALL ER 504, especially at p. 510 where his Lordship said this:

It is no part of the Court's function at this stage of the litigation to try to resolve conflicts of evidence on affidavit as to facts on which the claims of either party may ultimately depend nor to decide difficult questions of law which call for detailed argument and mature considerations. These are matters to be dealt with at the trial.

However, I am not barred and I need to consider whether on the available material before me, the plaintiffs have any real prospect of succeeding at the trial proper. The various consent judgments involving the defendant and where the defendant was obliged to fulfil were related to the same subject (i.e., Taman Damai). At its lowest ebb, the plaintiffs have a good prospect of succeeding at the trial. Next, I need to consider whether damages would be an adequate remedy. Here, the amount that was sought to be restrained is in the sum of RM1,489,988.88 sen, a huge amount and, unless the damages were in the same price range, there cannot be said to be an adequacy of damages for the plaintiffs in the event they succeed at the trial proper. A doubt here exists as to the adequacy of damages and, I, need now go, on the question of the balance of convenience as recommended by Lord Diplock in the American Cyanamid case (supra): "It is where there is doubt as to the adequacy of the respective remedies in damages available to either party or to both, that the question of balance of convenience arises." In construing the question of balance of convenience, the Court is not precluded from taking into account all the relevant factors and give appropriate weight to each of them. Thus, the defendant here could have applied to strike out the statement of claim if they thought that it was frivolous, vexatious and an abuse of the process of the Court. But, they saw it fit not do any of those things and, instead, have since filed a statement of defence. There was also the fear that the defendant might run away with RM3,116,353 which forms part and parcel of RM1,489,988.88 sen and thereby depriving the plaintiffs of their right to it. This aspect of the affidavit evidence was not challenged nor adverted to by the defendant in their affidavit in reply (encl. 6). It venture to say that the plaintiffs in their affidavits (encl. 1B and encl. 7 through their Counsel) have affirmed clear and concise statement of the facts. The plaintiffs' affidavits have stated clearly the cause of action and the alleged right that has been infringed. The various consent judgments against the defendant painted a bad picture for the defendant and after this and those other factors and, in fact, after taking the whole facts of the case in its correct perspective, the balance of convenience tilted strongly in favour of the plaintiffs. An injunction was the immediate answer to the plaintiffs' problems and damages, if the amount was smaller than RM1,489,988.88 sen, could never be said to be adequate. Thus, an injunction would certainly not prevent the defendant from addressing their grievances at the trial proper. I have taken into account the ability of the plaintiffs to honour their undertaking as to damages and this was a crucial factor in deciding the balance of convenience (the American Cyanamid case (supra)). I do not agree that just because the plaintiffs are poor, they are barred from obtaining an injunction. Limited financial resources should not be the sole barometer in deciding whether an injunction should be given in favour of that particular aggrieved individuals. Here, there are 245 plaintiffs going for a big loot of RM1,489,988.88 sen. Together they could well afford to pay for the damages (see for comparison Allen v. Jambo Holdings Ltd. [1980] 2 ALL ER 502).

For these reasons, I granted prayers (a) and (b) of encl. 1A and I further ordered that a sum of RM1,489,988.88 sen be deposited in the client's account of the plaintiffs' solicitors M/s. Bachan & Kartar, Ipoh, Perak with interest therein till the trial and judgment of civil suit No. 22-4-92 be completed. Costs should be costs in the cause.


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