DALAM MAHKAMAH RAYUAN MALAYSIA (BIDANG KUASA RAYUAN) RAYUAN SIVIL NO: P-02-1920-2011
PRANGIN MALL SDN BHD
(No. Syarikat 398663-A) … PERAYU
1. TANG JOO MING (NO. K/P: A0151755)
2. YEOH MOOI SIM
(NO. K/P: 621022-07-5620) … RESPONDEN-RESPONDEN
[Dalam perkara kes Saman Pemula No: 24-1249-2010 Mahkamah Tinggi Malaya di Pulau Pinang
Dalam perkara mengenai Perintah Mahkamah Sesyen Georgetown, Pulau Pinang bertarikh 2.10.2009. Saman No. 52-3224-2007
Dalam perkara mengenai kuasa-kuasa sedia ada Mahkamah dibawah Aturan 92 Kaedah 4. Kaedah-Kaedah Mahkamah Tinggi 1980
Dalam perkara mengenai Aturan 55 Kaedah 12, Kaedah-Kaedah Mahkamah Tinggi 1980.
Dalam perkara mengenai Aturan 7 dan Aturan 26, Kaedah-Kaedah Mahkamah Tinggi 1980.
Dalam perkara mengenai Seksyen 25(1) Akta Mahkamah Kehakiman 1964.
Dalam perkara mengenai Aturan 15 Kaedah 16, Kaedah-Kaedah Mahkamah Tinggi 1980
1. Tang Joo Ming [No. K/P: A0151755]
2. Yeoh Mooi [No. K/P: 621022-07-5620]
Prangin Mall Sdn Bhd [No. Syarikat: 398663-A]
RAUS SHARIF, PCA ABDUL WAHAB PATAIL, JCA ROHANA YUSUF, J
JUDGMENT OF THE COURT
 This is an appeal relating to collection of maintenance charges in a shopping complex called “Prangin Mall”, which was developed by a company known as “Getaran Unggul Sdn Bhd” (the Developer). By a management agreement and power of attorney dated 31.7.2007 (Management Agreement), the Developer appointed the Appellant to maintain and manage the Mall. Pursuant to the said appointment the Appellant was granted the Developer’s rights under the respective sale and purchase agreements entered into with purchasers of parcels in the Mall. Of the more significant right granted under there under, which forms the subject matter of this proceeding, is the right to collect maintenance charges and other outgoings from the purchasers.
 The Respondents were purchasers of the parcel known as No. 4-57. Under the sale and purchase agreement with the Developer (the Sale and Purchase Agreement), the Respondents were required to pay maintenance and service charges and an apportionment of insurance as well as quit rent (the Charges) to the Appellant. The Respondents failed to pay the Charges since 2004. As a result, the Appellant filed a suit against the Respondents at the Sessions Court for the sum of RM58,093.34; being the Charges due and owing as at 19.11.2007. Particulars and accounts whereof were as follows:
(a) Maintenance/service charges RM40,240.25
[May 2004 – December 2007]
Insurance Premium [25/09/2004 – 31/12/2007]
(c) Quit Rent [2005-2007] RM 110.25
(d) Interest [15/04/2002-19/11/2007] RM17,553.84
The Respondents filed defence and counter claimed for:
i. Failure of the Appellant to manage the Mall, and
ii. Misuse of the management common properties in the Mall by setting up structures.
 An application to strike out the Defence and Counter Claim was allowed by the learned Sessions Court Judge on 02.10.2009 and accordingly judgment was entered against the Respondents for the said sum of RM58,093.34. The Respondents thereafter lodged an appeal to the High Court against the said decision of the learned Sessions Court Judge. For reason, which neither is on record nor disclosed to us, the appeal was subsequently discontinued. Instead the Respondents filed this Originating Summons at the High Court seeking for a declaration that the judgment of the Sessions Court was null and void and liable to be set aside. It was allowed by the High Court. The Appellant is now appealing against the said decision of the High Court.
 This appeal is premised on the grounds that the High Court had erred for the following reasons. Firstly, it was contended by learned counsel for the Appellant that the issue of locus standi in respect of the Appellant’s
capacity to initiate the suit at the Sessions Court raised in this Originating Summons should not be allowed on the principle of res judicata or its more precise specie, issue estoppel. The reason for this, as we understand it, is because the Respondents did not raise the said issue, though they could have, at the proceedings in the Sessions Court. Secondly, learned counsel also submitted that the law did not prohibit the Appellant from claiming the Charges as they were due and owing well before the formation of Joint Management Body (JMB) under the Building and Common Property (Maintenance and Management) Act 2007 (Act 663). Therefore the Appellant contended it had, for all intents and purposes, the necessary locus standi to file the suit. For this reason learned counsel contended, the judgment of the Sessions Court was not illegal as alleged and should not have been set aside as being a nullity. He nevertheless argued that the Respondents ought to have pursued the appeal against that decision to the High Court instead of making an application to set aside the said judgment by way of this Originating Summons.
 Learned counsel for the Respondents, on the other hand, contended that the judgment of the Sessions Court was illegal because, upon the formation of JMB, the Developer was prohibited from collecting the Charges. The judgment of the Sessions Court according to him was in breach of Act 663 and by reason thereof was an illegal judgment and liable to be declared null and void and thereafter set aside. They argued , quite rightly that any court of law should not sanction an illegal judgment. (see Badiaddin Mohd Mahidin & Anor v Arab Malaysian Finance Bhd  2 CLJ 75).
 In determining the legality of the judgment, we are mindful that this proceeding is not an appeal of the decision of the Sessions Court although we are bound to consider the facts presented therein. In taking this approach, we are of the view that the more precise issue in this proceeding, is whether the Appellant retained its right to claim the Charges incurred prior to the formation of the JMB. It is not, as suggested by the learned counsel for the Respondents in the written submission, which is whether the Appellant loses its right per se to collect the Charges upon the formation of the JMB. This appears in the Respondents’ written submission where it was said that “once the JMB is formed the Appellant hands over all accounts and responsibilities in managing and maintaining the Mall to the JMB”.
 We have read the Statement of Claim of the Appellant filed at the Sessions Court. It was not in dispute that the Charges were amounts due and owing as at 19.11.2007. They were clearly incurred well before the formation of the JMB. It was also not in dispute that the JMB was formed on 28.9.2008. The Appellant’s claim was made pursuant to the Sale and Purchase Agreement made between the Respondents and the Developer. Under the Sale and Purchase Agreement the Respondents were responsible for, amongst others, payment of the Charges, the amount and manner of which were to be determined by the Developer. The Appellant, having been granted the Developer’s right, therefore claimed against the Respondents the Charges due and owing under the Sale and Purchase Agreement.
 Learned counsel for the Respondents relied on s 5.(4), s.20(2), s.16(3) and s.22(1) of Act 663 to offer the following interpretation. He contended, reading these provisions together would show that, the Appellant was only responsible to maintain and manage the Mall till the formation of the JMB. The role and duties of the Appellant ceased upon the formation of the JMB on 28.9.2008 and any surplus in the monies collected by the Appellant shall thereafter be transferred to the JMB.
 We have examined the above provisions of Act 663 cited to us. We agree with the interpretation put forth by the Respondents that the role and duties of the Appellant ceased upon the formation the JMB but not more than that.
 The duty of the Developer to carry out maintenance and management of the Mall before the formation of the JMB is imposed by S.5(4) of Act 663. It is therefore a legal duty imposed on the Developer to carry out maintenance and management of the Mall before the formation of JMB. Having imposed such a duty the law is silent on the right to collect the Charges by the Developer. This is in contrast to the position when it imposes the same legal duty on JMB. It clearly provides under s.8 the rights of JMB to collect the Charges etc from purchasers. We will discuss this matter further in the following paragraphs. Despite being silent on the right to collect the Charges, the Developer however is under an obligation under s.16 of Act 663 to open a Building Maintenance Account (BMA account) with a bank. The Developer shall maintain BMA until the formation of the JMB. Each BMA account must be opened in respect of each
development. The monies to be deposited into the account by the Developer are stipulated under s.17(1) of Act 663.
(a) All charges received by him from the purchasers in the development area for the maintenance and management of the common property of the development area; and
(b) All charges for the maintenance and management of the common property to be paid by the Developer in respect of those parcels in the development area which have not been sold, being a sum equivalent to the maintenance charges payable by the purchasers to the Developer had the parcels been sold.
 Unless a BMA account is opened in the name of the Developer and vacant possession is delivered, s.20 of Act 663 prohibits any collection of the Charges by any person to be made.
 The Developer’s duty to maintain and manage the Mall, as we have said, ceased upon the formation of JMB. Thereafter it became the duty of the JMB under s.8 of Act 663 to maintain the common property and keep it in a good serviceable repair. The JMB is empowered to collect, the maintenance and management charges from the owners, in proportion to the allocated share units of their respective parcels. It is also provided under s.22 of Act 663 that within one month of the formation of JMB, any amount standing surplus in the BMA shall be transferred to the JMB. The monies so transferred shall form part of the ‘Building Maintenance Fund’, which shall be managed and maintained by the JMB.
 Having outlined the above, it becomes clear that the Developer’s right to collect Charges is one that is derived under the Sale and Purchase Agreement and the amount owed by the Respondents herein are expenses incurred by the Developer prior to the formation of JMB. This contractual right to collect the Charges under the Sale and Purchase Agreement remain enforceable despite the obligation to manage and maintain the building ceased upon the formation of the JMB. We say this because Act 663 does not override or transfer that contractual right to JMB.
 Although under s.22 of Act 663 any surplus from the BMA shall be transferred to the JMB, it does not affirmatively say that the Developer’s right to collect Charges is likewise transferred or to use the term alluded by learned counsel for the Respondents “handed over1’ to the JMB. Further, we note in particular s.22.(1) does not deal with any situation precedent to the formation of JMB.
 The right of JMB to collect the Charges differs from that of the Developer. Under the Sale and Purchase Agreement, the Developer’s right is contractual in nature while under Act 663, JMB’s right is statutory. Any failure to pay the Charges to the JMB under the law would attract liabilities under s.34 of Act 663.
 A breach by the Respondents to pay the Charges under the Sale and Purchase Agreement would entitle the parties to remedies under the contract. Thus to deny the Developer its contractual right under the Sale and Purchase Agreement would lead to a situation where the Developer is denied of any recourse. As we have stated earlier although s.5 (4) of Act
663 imposed a duty to maintain and manage, it did not specifically provide a corresponding right to collect the Charges by the Developer. Even though the duty to maintain and manage must necessarily imply the right to collect the Charges, there is no clear provision for the same under the law. The Developer’s right to collect the Charges is only stipulated under the Sale and Purchase Agreement . In this regards we also take judicial notice that the Sale and Purchase Agreement is a contract sanctioned by law. It is an agreement made pursuant to Regulation 11 of the Housing Development (Control and Licensing) Regulations 1989. Thus to deny the Developer a contractual right under a contract sanctioned by another law would lead to disarray. Beside, it would also amount to an interference with freedom to contract.
 The right to collect the Charges granted to JMB under s.8 (2) of the Act is different from the Developer’s right under the contract. Section 8 of Act 663 provides the JMB with the right to collect the Charges in proportion to the allocated share units of their respective parcel. It is a statutory power giving authority to JMB to collect the Charges. Corresponding to the right of JMB to collect, the purchasers are bound by law under s.23(1) of Act 663 to pay the Charges. Failure on the part of the purchasers to pay the charges to JMB is an offence under s.34 of Act 663 punishable with a fine not exceeding RM5,000.00 and shall also be liable to a further fine not exceeding RM50,000.00 for every day during which the offence is continued after conviction. In our opinion therefore, the power to collect the Charges under Act 663 is a newly created right and only commences upon formation of the JMB. It is distinct and different from the contractual right of Developer under the Sale and Purchase Agreement. For the above
reason, we hold that there was no “handing over” of the Developer’s right to collect the Charges as submitted by the learned counsel for the Respondents.
 Any “handing over” or transfer of contractual rights can only take effect if there is an assignment of such rights either contractually or by law. There is no evidence of an assignment of the contractual right, nor any provision in Act 663 that transfers or hand over that contractual right. In this regard, we are mindful that if the words in the statute are clear and precise, then no more can be said or inferred than those words in the ordinary sense. The claim by the Appellant in the proceedings before the Sessions Court was premised on the contractual obligations that had clearly been breached by the Respondents. The law does not prohibit the Appellant from pursuing its claim, which incidentally is no more than a claim for breach of contract prior to the formation of JMB.
 In recognising the need to protect house buyers and consumers in general, we must adhere to the principal of fairness. The Charges claimed by the Appellant would have been incurred for the benefit of the Respondents. The Developer could not have gained profit when it is obliged under s.22 of Act 663 to transfer all surplus of monies collected from the purchases (the Respondents included) to the JMB . For reasons expounded above, we therefore hold that the Appellant retains its contractual right to collect the Charges, the amount of which was incurred prior to the formation of the JMB.
 On the mode of action adopted by the Respondents, it is clear that the Originating Summons application to set aside the Sessions Court judgment was made purely to enable them to raise issue on locus standi of the Appellant. The Respondents ought to be estopped from raising the issue of locus standi in this Originating Summons application by the principle of res judicata. The attempt by the Respondents to justify their failure to raise locus standi earlier at the Sessions Court , on the ground that they were only made aware of the formation and existence of the JMB one year later , on 28.9.2009, after the proceedings in that court was highly improbable for two main reasons. First, the JMB had commenced billing and collecting maintenance charges from the owners of parcels in the Mall since its formation on 28.9.2008. The Respondents being owners of a parcel at all material times ought to have been aware or deemed to be aware of the existence of JMB. Second, the composition of the JMB under s.4(1) (4) of Act 663 constitutes the Developer and the owners themselves. We do not see the need to go beyond saying that the Respondents and property owners in general ought to be more vigilant about protecting their rights and interests. They cannot simply come to court pleading ignorance when the evidence shows otherwise. We find that , if the learned High Court Judge had properly directed himself on this material fact he would have come to a different conclusion.
 The Respondents ought to have raised the issue of the locus of the Appellant at the proceedings in the Sessions Court. Their failure has attracted the application of the doctrine of res judicata .The Federal Court in Asia Commercial Finance (M) Berhad v Kawal Teliti Sdn Bhd  3 CLJ 783 had laid out the various situations on the application of the
doctrine. The doctrine has the effect of creating estoppels per rem judicatum, which may take the form of either cause of action estoppel or issue estoppels. This Originating Summons, in our considered view, would fall squarely on the principal of issue estoppel. The Respondents’ challenge on the Appellant’s capacity in the Originating Summons before the High Court was based on the facts in the proceedings before the Sessions Court. The issue of locus standi was available to the Respondents then. They could have quite easily raised it at the Sessions Court but did not. Otherwise there could have been and should have been an end to all proceedings between the parties herein. The Respondents should not be permitted through a rather ingenious approach, to take a second bite vide by making this Originating Summons; it is a backdoor attempt to put forth an issue that could have been brought before the court. Such conduct cannot be condoned. There is no injustice against the Respondent in the court below. If there had been any injustice in this case, it would have been to the Appellant who had expended sums of monies without recourse. The High Court ought to have dismissed this Originating Summons in limine.
 For the reasons we have given above, we say that there is no breach of statute by the Sessions Court when judgment was entered for the Appellant on the 02.10.2009. The only available avenue left to the Respondents was by way of appeal to the High Court, which they had discontinued. It is also a rule that the withdrawal of appeal by the Respondents of the Sessions Court Order left nothing more for the Court to adjudicate.
 In the circumstances we allow the appeal by the Appellant. We set aside the Order of the High Court that declared the judgment of the Sessions Court as being a nullity. We award costs of RM5000.00 to the Appellant.
DATO’ ROHANA YUSUF
High Court of Malaya KUALA LUMPUR
Dated: 24 October 2012
Counsel for the Appellant:
Dato’ K. Kirubakaran Tetuan Kek Ooi & Lee Hong Peguambela & Peguamcara 53, Tingkat 1, Lebuh Pantai 10300 PULAU PINANG
Counsel for the Respondent: Encik Rajivan
Tetuan Sitham & Associates Peguambela & Peguamcara No. 4-B, Brown Road 10350 PULAU PINANG