Air Express International (M) Sdn Bhd V Misc Agencies Sdn Bhd

  

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W-02-168-2008

 

DALAM MAHKAMAH RAYUAN MALAYSIA (BIDANG KUASA RAYUAN) RAYUAN SIVIL NO: W-02-168-2008

 

ANTARA

 

AIR EXPRESS INTERNATIONAL (M) SDN BHD .. PERAYU

 

DAN

 

MISC AGENCIES SDN BHD (024920-X) .. RESPONDEN

 

(Dalam Perkara Mahkamah Tinggi Malaya di Kuala Lumpur Dalam Negeri Wilayah Persekutuan (Bahagian Dagang) Guaman Sivil No. D4-22-882-2003

 

ANTARA

 

AIR EXPRESS INTERNATIONAL (M) SDN BHD .. PLAINTIF

 

DAN

 

MISC AGENCIES SDN BHD (024920-X) .. DEFENDAN)

 

CORAM:

 

RAMLY HJ ALI, JCA

 

ALIZATUL KHAIR OSMAN KHAIRUDDIN, JCA ANANTHAM KASINATHER, JCA

 

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W-02-168-2008

 

JUDGMENT OF THE COURT

 

1. This is an appeal by the Plaintiff/Appellant against the decision of the High Court in dismissing its claim with no order as to costs.

 

The Appellant’s claim

 

2. The Appellant, Air Express International (M) Sdn Bhd, at all material times was a company involved in a business of delivering consignment and customs’ clearance for its customers. On or about 26 March 1998, the Appellant had made a declaration to the Pengarah Kastam Negeri Subang via Customs K1 Form No. W11103021323 of its customer’s consignment. The import duty payable for the consignment was RM93,813.24.

 

3. On or about 30 March 1998, the Appellant had instructed its bank, Malayan Banking Berhad (MBB) to issue a banker’s cheque payable to “Pengarah Kastam Negeri Subang”. MBB issued the said banker’s cheque bearing No. 213709 for the sum of RM93,813.24, being the amount of the import duty due

 

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to the customs. The payment was proved by an endorsement on the said Form K1. The Appellant was then allowed to take out the consignment since the duty was paid on 30 March 1998 and had delivered the consignment to its customer.

 

4. Nearly a year later (on 16 March 1999) the Appellant was informed by the Customs Preventive Officer (PW2) that the import duty payable on the Appellant’s Form K1 had not been paid yet.

 

5. Initial investigation, revealed that the Appellant’s banker’s cheque dated 30 March 1998 for the sum of RM93,813.24 was deposited into the customs RHB’s (RHB Bank Berhad) account no. 014118157214. Upon further investigation the Appellant alleged that the said banker’s cheque had been wrongfully used by the Respondent to pay for its customer’s consignment import duties. The Appellant’s investigation also revealed that the Respondent was also involved in a similar business such as the Appellant and at the material time the Respondent’s customer was Tenaga Nasional Berhad (TNB).

 

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6. The Appellant commenced the present action at the Kuala

 

Lumpur High Court against the Respondent for the following

 

orders –

 

(a) a declaration that the said payment vide the Appellant’s banker’s cheque for the sum of RM93,813,24 dated 30 March 1998 was a valid payment by the Appellant for the import and sales tax duty for Customs Form K1 W11103021323 dated 26 March 1998;

 

(b) in the alternative, the Respondent is to pay to the Appellant a sum of RM93,813.24 as damages for the usage of the Appellant’s banker’s cheque;

 

(c) that the customs does the necessary rectification to the consignment duty by crediting the sum of RM93,813.24 to reflect that Customs Form K1 W11103021323 dated 26 March 1998 has been paid by the Appellant vide the Appellant’s banker’s cheque;

 

(d) costs to be borne by the Respondent and paid to the Appellant;

 

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(e) general damages to be taxed; and

 

(f) any other order and/or relief as deemed fit by the High Court.

 

The Respondent’s defence

 

7. In the statement of defence, the Respondent pleaded inter alia, that the Respondent had no knowledge of the Appellant’s banker cheque and/or the other documents referred to in the Appellant’s statement of claim and put the Appellant to strict proof thereof. The Respondent also pleaded in the alternative that even if the Appellant’s banker’s cheque was used by its worker or agent, the Appellant did not state the name of the worker or agent or to the time and place of the alleged wrongful act. The Respondent pleaded that the Appellant’s claim be dismissed with costs.

 

8. On 20 March 2007, the learned High Court judge dismissed the Appellant’s claim without an order as to costs, after full trial. Hence the present appeal before us.

 

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The Appellant’s reply

 

9. In its reply, the Appellant contended that there was an endorsement at the back of the Appellant’s banker’s cheque which showed that it was used by the Respondent’s staff or agent by name, Azim (with identity card no. A2594305) and that the receipt numbers endorsed at the back of the said banker’s cheque corresponded with the receipts printed on the Respondent’s Customs Form K1.

 

10. The Appellant argued that by the fact of the endorsement of receipt numbers on the back of the said banker’s cheque, the Appellant had discharged the heavy burden upon it of proving that the Respondent had wrongfully used the Appellant’s said banker’s cheque to pay for the customs duties payable by the Respondent on behalf of its customer, TNB.

 

The High Court Judge’s grounds of decision

 

11. In dismissing the Appellant’s claim without an order as to costs, the learned High Court judge gave the following reasons-

 

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(a) since the Appellant obtained customs clearance on 30 March 1998, the Appellant’s banker’s cheque must have been with the Customs Department, and if applied to payments on other accounts on 27 April 1998, it could only occur when the Appellant’s banker’s cheque is with the Customs Department;

 

(b) although the Respondent appears to have benefited from the Appellant’s banker’s cheque, the question remains open whether the wrongful use was by the Respondent or the Customs Department. It is at least probable the error was in the Customs Department, in which case there is no ground to make orders at the Appellant’s instance. Although the Appellant’s prayers had also sought orders against the Customs Department, the Customs Department had not been made a party and the latter had not had the opportunity to defend itself against any order that might be made against it. No order may be made against the Customs Department also; and

 

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(c) since the Respondent benefited from the Appellant’s bankers cheque and since in these circumstances it had not shown it has itself paid, the court will not make an order of costs in its favour. There is, therefore, no order as to costs.

 

Findings of this court

 

12. In his judgment the learned judge found, that the application of the Appellant’s banker’s cheque to payments on other account i.e. the Respondent’s account could only occur when the said banker’s cheque was in the hand of the Customs Department, particularly after the Appellant had obtained customs clearance on its consignment on 30 March 1998. The learned judge went on to find that “it is at least probable the error was in the Customs Department”. The learned judge refused to make any order against the Customs Department on the ground that “the Customs Department had not been made a party and it had no opportunity to defend itself against any order that might be made against it”.

 

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13. The learned judge failed to appreciate and to give due weight or failed to make the correct inference based on the evidence adduced before the court. There are sufficient evidence to show that the Appellant had declared to the Customs Department in respect of its own customer’s consignment vide customs Form K1, which totals to the sum of RM93,813.24; that the Appellant had paid the said duties by MBB Banker’s cheque no. 213709 for the same amount; that the Respondent had declared to the customs in respect of its own customer’s consignment vide 6 Form K1, of which total to the sum of RM93,809.86; that on the reverse side of the Appellant’s bankers cheque, there is a range of receipt numbers printed which are the same numbers printed on the Respondent’s Form K1; that the ‘Rekod Kutipan Hasil Juruwang’ for the relevant dates shows that a sum of RM3.38 (being the difference between the amount in the Appellant’s banker’s cheque and total amount of the import duties declared by the Respondent in its Form K1) was returned to the Respondent by the Customs Department; and that PW2’s oral testimony

 

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wherein he admitted that based on his departmental investigation into the matter the Appellant’s banker’s cheque was used by a third party. (PW2 is Encik Saleh A. Majid, the Customs Prevention Officer in charge of the investigation related to this matter).

 

14. Although on one hand the learned judge in his judgment (at para 15-17 page 32-33 of the appeal records) had accepted the Appellant’s evidence, yet on the other hand (at para 18, page 34 of the appeal records) he stated that there was no evidence before the court as to how the Respondent obtained the said banker’s cheque and went on to dismiss the Appellant’s claim against the Respondent.

 

15. At page 34, para 20 of the appeal records, the learned judge also dismissed the Respondent’s evidence that its customer’s import duties were in fact paid by its own banker’s cheques on the ground that there was no corresponding banker’s cheques shown, nor was there any evidence shown whether those cheques were in fact credited into the customs accounts.

 

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16. On the balance of probabilities and on the totality of the whole evidence before the court, we are satisfied that the Appellant has proven and discharged its burden of proof that the Appellant has paid the import duty to the customs and on that basis the consignment was released and delivered to the Appellant’s customers. The Appellant had also, on the balance of probabilities, proved that the said banker’s cheque belonging to the Appellant was wrongfully used by the Respondent to pay its own customer’s duties. The oral testimony of SDI, Mohd. Azim Ishak, particularly during his cross-examination, has failed to rebut the Appellant’s case on the balance of probabilities on this issue. This in itself is a wrongful act on the part of the Respondent. The issue as to how the Respondent obtained the said banker’s cheque is, to our mind, irrelevant to the issues to be considered. The Appellant has discharged its burden of proof and proved that the Respondent had wrongfully used the Appellant’s banker’s cheque knowingly, and the Respondent had clearly obtained a material advantage by the said use of the Appellant’s banker’s cheque. (see: PJTV Denson (M) Sdn Bhd & Ors. v. Roxy

 

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(Malaysia) Sdn Bhd [1980] 2 MLJ 136; Chu Choon Moi v. Ngan Sew Tin [1985] 1 LNS 134 and Magnum Finance Berhad v. Tan Ah Poi & Anor [1997] 4 CLJ Supp 44).

 

17. The 1st prayer (prayer a) in the Appellant’s statement of claim, prays for a declaratory order – a declaration that the said payment vide the Appellant’s banker’s cheque for the sum of RM93,813.24 dated 30 March 1998 was a valid payment by the Appellant for the import and sales tax duty for Customs Form K1 W-11103021323 dated 26 March 1998.

 

18. PW2 – Encik Saleh A Majid, the Customs Preventive Officer in charge of the investigation related to this matter agreed and admitted that based on his investigations the said Appellant’s banker’s cheque was used by the third party. There was sufficient evidence to prove that the said “third party” refers to the Respondent.

 

19. We are of the view that the learned judge had made a wrong finding in dismissing the Appellant’s declaratory application merely on the grounds that the Customs Department was not made a party to the proceedings. Viscount Radcliffe in Ikebife

 

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Ibeneweka & Ors. v. Peter Egbuno & Anor [1964] 1 WLR 219 at page 226 ruled-

 

“However that may be, there has never been any unqualified rule of practice that forbids the making of a declaration even when some of the persons interested in the subject of the declaration are not before the court. The above principle was adopted and followed by the Supreme Court in Dewan Undangan Negeri Kelantan & Anor v. Nordin Salleh & Anor (1)[1992] 1 CLJ 72 (Rep) [1992] 2 CLJ 1125.”

 

20. In this case, the learned judge should have granted the declaration prayed for particularly when there are evidence to show that PW2, being an officer of the Customs Department in charge of the investigation relating to this matter appeared in court and admitted in his testimony that the Appellant’s said banker’s cheque was wrongfully used by a third party and the said third party was the Respondent. Even the learned judge in his grounds of judgment had concluded that the Appellant had made the payment on the customs duty in question to the amount of RM93,813.24; the error was in the Customs

 

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Department; the Respondent had not shown it has itself paid the amount of its duties; and the Respondent had benefited from the Appellant’s Banker’s Cheque. To refuse such a declaratory relief to the Appellant in the circumstances of the case, is clearly unjust and inappropriate.

 

21. That being the case, we are also of the view that there are no legal impediment for the court to grant the Appellant in respect of its prayer (c) i.e. to order the Customs Department to do the necessary rectification to the consignment duty by crediting the sum of RM93,813.24 to reflect that the Customs Form K1 W-11103021323 dated has been paid by the Appellant vide the Appellant’s banker’s cheque. The Customs Department would not be caught by surprise if the order for rectification is granted. The Department was aware of the matter right before the Appellant filed its claim in court; they had done their own internal investigation, led by PW2; and concluded that the said banker’s cheque in question was wrongfully used by a third party. What the Department need was a valid court order for rectification of the records made by the court based on the

 

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whole evidence adduced in court, where it was proven that the said third party refers to the Respondent.

 

22. Alternatively, the learned judge could also grant the alternative remedy prayed for by the Appellant in prayer (b) of the claim

 

i.e. the Respondent is to pay to the Appellant a sum of RM93,813.24 for damages for the wrongful usage of the Appellant’s banker’s cheque.

 

23. The Appellant stood on solid ground for the claim made as the facts and circumstances of the present case clearly point in its favour for the alternative order prayed for i.e. for damages or restitution of the amount relating the wrongful usage the Appellant’s banker’s cheque. Restitution means to cause the restoration of a thing, the enrichment or benefit or its money’s worth received by the Respondent from the wrongful usage of the Appellant’s banker’s cheque, at the expense of the Appellant. To determine unjust enrichment, either in relation to section 71 of the Contract Act 1950 or the common law, the Appellant in this appeal must satisfy the following three enquires-

 

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(a) that the Respondent was enriched by receiving a benefit;

 

(b) that the benefit received was at the Appellant’s expense; and

 

(c) that the retention of the benefit by the Respondent was unjust.

 

(See: Sediperak Sdn Bhd v. Baboo Chowdury [1999] 5 CLJ

 

31).

 

24. In the present case, the evidence adduced as well as the grounds of judgment of the learned judge clearly indicate the Respondent was enriched by receiving the benefit of the value of the Appellant’s banker’s cheque. The evidence also show that the said banker’s cheque was wrongfully used by the Respondent to pay for its customer’s customs duties and as found by the learned judge “the Respondent benefited from the Appellant’s banker’s cheque and … it had not shown it has itself paid” the customs duties. Of course the enjoyment of the benefit of the banker’s cheque by the Respondent was at the expense of the Appellant. On the facts and circumstances of

 

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the present case, the continued retention of the benefit by the Respondent is totally unjust.

 

Conclusion

 

25. Based on the above considerations, and on the totality of the evidence adduced before the trial court, we are of the view that the learned judge’s decision to disallow the Appellant’s claim was not in line with the evidence adduced. There was ample evidence, on the balance of probabilities to establish the Appellant claim against the Respondent.

 

26. We therefore allow the appeal with costs of RM10,000 to the Appellant and make an order that the deposit to be refunded to the Appellant.

 

Dated: 27 September 2011

 

Sgd.

 

Ramly Hj Ali Judge

 

Court of Appeal Malaysia

 

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Solicitors:

 

1. R. Subitra Dali

 

Messrs. Surend Mokhzani & Partners .. for the Appellant

 

2. Zulkifli Omar (with Azmer Saad)

 

Messrs. Lainah Yaacob & Zulkepli .. for the Respondent

 

Cases Referred to:

 

1. PJTV Denson (M) Sdn Bhd & Ors. v. Roxy (Malaysia) Sdn Bhd [1980] 2 MLJ 136

 

2. Chu Choon Moi v. Ngan Sew Tin [1985] 1 LNS 134

 

3. Magnum Finance Berhad v. Tan Ah Poi & Anor [1997] 4 CLJ Supp 44

 

4. Ikebife Ibeneweka & Ors. v. Peter Egbuno & Anor [1964] 1 WLR 219 at page 226

 

5. Dewan Undangan Negeri Kelantan & Anor v. Nordin Salleh & Anor (1)[1992] 1 CLJ 72 (Rep) [1992] 2 CLJ 1125

 

6. Sediperak Sdn Bhd v. Baboo Chowdury [1999] 5 CLJ 31

 

Legislation Referred to:

 

1. Contract Act 1950: section 71

 

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