Kalung Makmur Sdn Bhd V Lo Yen Nyuk


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CIVIL APPEAL NO Q-02(IM)(NCVC)-1361-07/2016








LO YEN NYUK (WK.KP 541216-13-5206) … RESPONDENT


(In the matter of High Court in Sabah and Sarawak at Kuching Suit No. KCK-22NCVC-48/11/2015)








LO YEN NYUK (WN.KP 541216-13-5206) … DEFENDANT












1. We have read the draft grounds of our learned brother, Justice Hamid Sultan Bin Abu Backer. However, with regret and respect, we are unable to concur with him on the outcome of this appeal. Hence the grounds herein are the views of myself and my sister Justice Umi Kalthum Binti Abdul Majid and reasons as to what we think should be the outcome of this appeal.


2. This is an appeal by the Appellant/Plaintiff against the decision of the High Court in which the learned Judge allowed an application pursuant to Order 18 rule 19 (a) Rules of Court 2012 by the Respondent/Defendant to strike out the statement of claim in which the cause of action is grounded on the tort of libel premised on a police report made by the Respondent.




3. We heard the appeal on 18.4.2017 and had reserved our decision. We have since given further consideration to the submissions by respective counsel and now give our decision and grounds.


Background facts:


4. The Appellant has a service contract with Village Grove Condominium Management Corporation (VGC) in which the Appellant provided services which included collecting payments from debtors of VGC and forward any payments of debts to the creditors of VGC.


5. Three cheques were issued by VGC, two of those cheques were issued to Yunco Enterprise Sdn Bhd (Yunco) and Perunding EC Rakan. These cheques were signed by the Respondent and one Angeline Bateman who are the authorised signatories of the cheque account of VGC. The cheques were collected by the Appellant’s employee on 17.7.2015.


6. On 20.7.2015, VGC received a letter from Yunco with a threat to sue VGC for loss and compensation for non-payment of its debt to Yunco. The Respondent made enquiries with the Appellant, to




which no reply was received by the Respondent and neither were the cheques returned back to the Respondent.


7. In view of what had happened to his enquiries, the Respondent made a police report relating to the three cheques. The police report was then published by the Respondent by affixing the same on the public notice board of Block A and Block D of the condominium complex.


8. The police report reads as follows:


“I, Lo Yen Yuk (541216-13-5206) is making this report on behalf of residents of Village Grove Condominium (VGC).


Three cheques dated 13/7/2015 as stated below and issued by VGCMC cannot be located today.


1. Yunco Enterprise Sdn. Bhd. (Yunco) – HLBB


001081 amounting to RM169,911.34 dated 13.7.2015.


2. Yunco Enterprise Sdn. Bhd (Yunco) – HLBB


001082 amounting to RM61,051.00 dated 13.7.2015.


3. Perunding EC Rakan (EC) – HLBB 001083 amounting to RM15,000.00 dated 13.7.2015.


Fifiriana, the account clerk of Kalung Makmur Sdn. Bhd. (KM) has collected the cheques from me on




16.7.2015 for the payment to VGC’s contractor, Yunco and VGC’s consultant. EC still haven’t received any payment from KM despite frequent follow up with KM office.


The cheques were signed by two other council members, VGC is undergoing a change of council members. I learnt from Ms. Joyce Kho, the manager of Hong Leong Bank (HLB), RH Plaza Branch that the new council members went to HLB on 10.7.2015 to change the signatories to their names and signatures. They submitted the minutes of a meeting held on


9.7.2015 which showed them to be the new council. No authorization letter from old council members was given. Without further verification HLB made the change in signatures based on the minutes given by new council members and effective from 15.7.2015 onward.


The new signatories that the bank allowed consist of three people which have no right to hold any office in VGC. They are not proprietors and are not allowed to be council members under the Strata Title Ordinance (STO). Their positions as council members are now being challenged by other residents. Their meeting on


9.7.2015 did not comply with the STO and is therefore illegal and their election as council is null and void.




The HLB also said the cheques were invalid since the signatories have been changed.


VGC is now faced with the problem of three missing cheques. Failure to pay on time will result in losses and damage due to contractor taking legal action. We make this report for the police to investigate all the above. ”


9. Premised on the police report, the Appellant alleges in the statement of claim that in their literal and ordinary meaning, as summarized by the learned Judge, they were understood to mean that the Appellant is a criminal, untrustworthy professional entity in the performance of its job, inefficient, careless and/or negligent in performing its duty and incapable of handling clients’ or people’s affairs. It is also alleged that the publication of the police report has brought the Appellant’s reputation as a property management company into disrepute, thereby lowering the Appellant’s esteem in the eyes of its clients, the residents of the Property and/or damaged the Appellant’s employment prospect. The loss of reputation and dignity is irreparable and the business of the Appellant has been badly affected.




10. The Respondent as alluded above took out an application to strike out the statement of claim premised on the ground that the police report made by the Respondent is protected by absolute privilege and hence no cause of action arises.


High Court:


11. The learned Judge agreed with the Respondent and relying on the Federal Court case of Lee Yoke Yam v Chin Keat Seng [2012] 9


CLJ 833 where it held that statements in a police report are protected by absolute privilege and as such no cause of action arises from such a report.


Our Grounds of Decision:


12. This appeal stems from an interlocutory application. We are hearing this appeal by way of a rehearing as demanded by section 69(1) of Courts of Judicature Act 1964 which basically means that we approach it as if we are hearing it for the first time but of course giving the appropriate weightage to the reasoning of the learned Judge.




13. At this juncture, we remind ourselves what approach which we need to adopt in dealing with an interlocutory application to strike out the statement of claim pursuant to Order 18 Rule 19 (a) or (b) or (c) or (d) and/or Order 92 rule 4 Rules of Court 2012. The Court’s approach in such application is well established and it is clearly set out in Owen Sim Liang Khui v Piasau Jaya Sdn Bhd & Anor [1996] 4 CLJ 716 where the Federal Court through Gopal Sri Ram JCA says, at page 744 as follows:


The power to summarily strike out a pleading must be sparingly exercised and in respect of the philosophy that underlies the exercise of that power we can do better than to quote from the judgment of Mohamed Dzaiddin SCJ in Bandar Builder Sdn. Bhd. v. United Malayan Banking Corporation Bhd. [1993] 4 CLJ 7; [1993] 3 MLJ 36, at p. 44:


This Court as well as the Court below are not concerned at this stage with the respective merits of the claims. But what we have to consider is whether the counterclaim discloses some cause of action and, likewise, whether the defence to counterclaim raises a reasonable defence. 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 the trial is no ground for the pleadings to be struck out (see Moore v. Lawson




[1915] 31 TLR 418 and Wenlock v. Moloney & Ors. [1965] 1 WLR 1238).


14. Also in Abdul Rahim Abdul Hamid & Ors V. Perdana Merchant Bankers Bhd & Ors [2000] 2 CLJ 457 this Court states, at page 467 as follows:


We would like to make it clear that at this stage of the proceedings on an application under O. 18 r. 19(1) of the Rules of the High Court 1980, we are not concerned with the prospect of success or failure of Carah’s claim. This is a matter for the trial judge to decide on the evidence adduced before him. We are only concerned whether there is a reasonable cause of action raised by the appellants. We are of the opinion that the allegations in paras 10(1) and 10(1)(a) of Carah’s statement of claim, on the assumption that they are true or proven, and without looking at the affidavit evidence, clearly disclose a reasonable cause of action. Accordingly, we are of the view that the lenders’ application to strike out Carah’s statement of claim under O. 18 r. 19(1)(a) of the Rules of the High Court cannot succeed.


15. From the submission of the Appellant’s counsel and the contents of the statement of claim, it can be said that the Appellant’s cause of action is simply premised on the tort of defamation.




16. The main complaint of the Appellant is simply that this is not an appropriate case for the Court to exercise the draconian power to strike out the statement of claim as the Appellant had shown that there are triable issues which require a full trial to determine.


17. The learned Judge from the outset decided that she will not look at the affidavits filed by respective parties as she felt that the application was substantially anchored on Order 18 rule 19(a). There were 21 affidavits filed altogether. This refusal to look at affidavits is in fact a ground of appeal. We find merit in this complaint as the Respondent’s application is premised also on Order 18 Rule 19 (b) or (c) or (d) and/or Order 92 rule 4 Rules of Court 2012 which allow affidavits to be filed to support or oppose the application. The averments of the Appellant would be of utmost importance in this context as they contain reasons which may show that they have a reasonable cause of action. To ignore them, with respect, would be denying the Appellant the opportunity to show that the statement of claim contains triable issues, no matter how weak they are, which require a full trial to determine. Be that as it may, as this appeal before us is a rehearing, we will take those affidavits into consideration for our deliberation.




18. It is submitted by the counsel for the Appellant that generally statements in police report enjoy absolute privilege from any suit relating to the tort of defamation except when the police report is made with malice. To support his contention, we are referred to a High Court case of Hoe Thean Sun & Anor v Lim Tee Keng [1999] 1 CLJ 187 where the learned Judge held, at page 191 as follows:


The law clearly recognises that all statements made in a police report are statements made on a privileged occasion. However, the privilege is qualified and not absolute . The primary purpose of a police report is to set in motion the investigation of an offence and bring to justice the offender and perpetrators, if any, at the conclusion of the investigation by the appropriate authorities.


The onus lies on the plaintiff to prove malice and not the defendant to prove his bona fides or absence of malice. When the occasion is privileged the bona fides of the defendant is always presumed. In this case, there is no doubt that, in law, the defendant published the defamatory statements on a privileged occasion. It is, therefor, to be assumed that he published it honestly, believing his statements to be true, unless there is some evidence to the contrary, for example, that the defendant was fully apprised of the letter dated 20 May 1992 (p. 10, Bundle B) and the letter dated 5 November 1992 (p. 11, Bundle B) at any time




before he lodged his report. The fact that the defendant had been informed by the 1st plaintiff on 17 March 1993 that the MGR shares had not been deposited with him and that he had also informed the defendants solicitors by letter dated 7 April 1993 (p. 14, Bundle B) and letter dated 12 April 1993 (p. 1, Bundle A) that the original share certificates were never in his possession, cannot establish malice without the further evidence that the defendant was fully aware of the letter dated 20 May 1992 (p. 10, Bundle B) and letter dated 5 January 1992 (p. 11, Bundle B), coupled with the fact that the said letters had been brought to his attention (before he made the report) either by Sey Hoe Sdn. Bhd. or the plaintiffs themselves, in support of the claim that the shares were never in fact in the possession of the 1st plaintiff at any time after the sale and purchase agreement had been executed.


19. With respect, what is expounded by the learned Judge in Hoe Thean Sun & Anor (supra) is no longer good law in view of the Federal Court decision in Lee Yoke Yam v Chin Keat Seng [2012] 9 CLJ 833. In that case, the Respondent had lodged a police report based on the contents of an affidavit filed by the Appellant to oppose the Respondent’s injunction in another suit. The Appellant took out a legal suit against the Respondent premised on the tort of defamation for what was stated in the police report. Like in the case at hand, the Respondent there took




out an application under Order 18 Rule 19 (1) (a), (b) and (c) of the Rules of the High Court 1980 to strike out the suit. Both the High Court and the Court of Appeal allowed the application and duly dismissed the writ and the statement of claim premised on the ground that a police report enjoyed absolute privilege against any claim for defamation.


20. The Federal Court granted leave to appeal on this sole question:


Whether statements in a police report are protected by the defence of absolute privilege and therefore no party can file a defamation suit against the maker of the police report in the Malaysian context?


21. In that case, the Plaintiff in his pleadings had alleged that the Defendant had made the police report with malice with the intention to coerce the Plaintiff into settling several lawsuits between the parties. The Federal Court, through the Judgment of the then learned Chief Justice Arifin Zakaria, discussed the position of the law in the Indian and English jurisdictions and found that in both jurisdictions absolute privilege is accorded to statements made in a police report irrespective whether there is element of malice on the part of the Defendant. The then learned Chief Justice then discussed cases in our jurisdiction, more




particularly the judgment of this Court in Abdul Manaf Ahmad v Mohd Kamil Datuk Hj Mohd Kassim [2009] 2 CLJ 121 which, in essence, affirmed the Indian and English positions.


22. The then learned Chief Justice also set out the rationale of according absolute privilege to statements made in a police report.


[32] Premised on the above, we agree with the decision of the Court of Appeal in Abdul Manaf Ahmad (supra) that on public policy consideration, absolute privilege should be extended to a statement contained in a police report lodged under s. 107 of the CPC as in the case of statement made under s. 112 of the CPC. The underlying reason behind this, is the overriding public interest that a member of the public should be encouraged to make police report with regard to any crime that comes to his or her notice. Such a report is important to set the criminal investigation in motion. With such report, the alleged crime may be investigated and the perpetrator be brought to justice. It is without doubt that public interest should override the countervailing consideration that this may sometime lead to an abuse by a malicious informant. In any event, if a false report is lodged by a complainant, he is liable to be prosecuted for making false report under s. 177, s. 182 or s. 203 of the Penal Code. That we believe provides a sufficient safeguard against any person from making a false report.




23. Learned counsel for Appellant in his submission had stressed that the Appellant ought to be given his day in Court to prove the element of malice on the part of the Respondent. Particulars of malice are set out in details in the statement of claim and the numerous affidavits filed by the Appellant. Learned counsel in his submission also alluded us to the fact that the Respondent had circulated the police report to residents of the Condominium complex and this action is consistent with the malicious intent of the Respondent. With respect, and as much we want to agree with the learned counsel for the Appellant, that is not the law of the land. Malice is not a relevant consideration to the concept of absolute privilege as opposed to the concept of qualified privilege where if malice is proven that privilege can be taken away or dismantled and the maker of those defamatory remarks will suffer the consequences. In any event, as pointed out by the then Chief Justice in Lee Yoke Yam (supra), criminal prosecution for lodging a false report is an adequate remedy for the malice factor.


24. Our view is consistent with this Court of another panel in the recent case of Zahida Binti Mohamed Rafik V Noor Azman Bin Azemi,


Rayuan Sivil No: W-02(NCVC)(W)-393-03/2015 where it also related to a police report lodged by the Appellant/Defendant




against her driver/Respondent/Plaintiff concerning of his failure to deposit a large amount of monies in the Appellant’s bank account as instructed. At a press conference, the Appellant had repeated what was stated in the police report. At the High Court, the learned Judge found that the Respondent had a valid cause of action in defamation. This Court on appeal found that the learned Judge had erred in failing to appreciate and apply the law which states that police report and its contents enjoyed absolute privilege in a defamation action and hence dismissed the Respondent’s defamation suit against the Appellant.




25. This is a case where the highest Court of the land has spoken with clarity such that we had little problem in concluding that this is a fit and proper case to exercise the Court’s summary power to dismiss the Appellant’s claims as they are obviously unstainable in law or most unlikely to succeed at trial.


26. For reasons stated above, we dismiss the appeal with costs in the sum of RM5,000.00 subject to payment of allocatur fees. We also order the deposit to be refunded.




Dated : 27 July 2017






Court of Appeal Malaysia


For the Appellant : Ateng Jeros


Messrs. Ateng Jeros Advocates


For the Respondent : Chong Siew Chiang


With him Carol Lua Di Chiun Messrs. Chong Brothers Advocates


Notice: This copy of the Court’s Reasons for Judgment is subject to formal revision.



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