Antara1. Scl System Enterprise Pte Ltd(Company Reg No: 200416371m)2. Chew Kian Hee(No. Pasport : S7023202b) … Plaintif-PlaintifDan1. Regaltech (M) Sdn Bhd(No. Syarikat: 752971 – V)2. Sun Cheng Leng(No. K/P: 760926-04-5141)3. Turck Singapore Pte Ltd(Company Reg No: 200511020r)4. To Chi Djau(No. Pasport : K18454370)5. Aw Huey Chin6. Msi Automation Sdn Bhd(No. Syarikat: 1083061 – U)7. Regaltech Automation Sdn Bhd(No.

  

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DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR

 

(BAHAGIAN DAGANG)

 

GUAMAN SIVIL NO: 22IP- 41 – 08/2014

 

ANTARA

 

1. SCL SYSTEM ENTERPRISE PTE LTD (Company Reg No: 200416371M)

 

2. CHEW KIAN HEE

 

(No. Pasport : S7023202B) … PLAINTIF-PLAINTIF

 

DAN

 

1. REGALTECH (M) SDN BHD (No. Syarikat: 752971 – V)

 

2. SUN CHENG LENG

 

(No. K/P: 760926-04-5141)

 

3. TURCK SINGAPORE PTE LTD (Company Reg No: 200511020R)

 

4. TO CHI DJAU

 

(No. Pasport : K18454370)

 

5. AW HUEY CHIN

 

6. MSI AUTOMATION SDN BHD (No. Syarikat: 1083061 – U)

 

7. REGALTECH AUTOMATION SDN BHD

 

(No. Syarikat: 822620 – A) … DEFENDAN-DEFENDAN

 

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Grounds of Judgment

 

Azizah Nawawi, J:

 

Introduction

 

[1] There are two parts to the Plaintiffs’ claims against the Defendants:

 

(i) as against the Third and Fourth Defendants, the Plaintiffs’ claim is premised on the breach of contract establishing the “Turck Supply Chain”, which is for the sale of Turck products to Bromma Malaysia through the First Plaintiff and Regaltech Penang together with conspiracy to defraud and financially injure the Plaintiffs and unlawful interference with the Plaintiffs’ trade; and

 

(ii) as against the First, Second, Fifth, Sixth and Seven Defendants, the Plaintiffs’ causes of action are breach of fiduciary duties, breach of Non Disclosure Agreement, conspiracy to defraud and financially injure the Plaintiffs and unlawful interference with the Plaintiffs’ trade.

 

The Salient Facts

 

[2] The First Plaintiff (‘SCL Singapore’) is a private limited company incorporated under the laws of Singapore and the authorised sole distributor or agent of Q-Light products for the Territory of Singapore, Indonesia and Malaysia (Q-Light products). SCL Singapore owns the intellectual property of the e-portal http://eportal.scl system.com.sg/webportal (‘E-Portal’).

 

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[3] The Second Plaintiff is the majority shareholder and managing director of the SCL Singapore. He is also a shareholder and director in SCL System Sdn Bhd (‘SCL Malaysia’), together with the Second Defendant and Chow Chen Nam.

 

[4] The First Defendant (‘Regaltech Malaysia’) is a company owned by the Second Defendant and Choi Ming Teck.

 

[5] The Second Defendant is a director and shareholder of the Regaltech Malaysia, the Seventh Defendant, Regaltech Penang Sdn Bhd (‘Regaltech Penang’) and SCL Malaysia. The Second Defendant was involved in the daily operations of SCL Malaysia until his resignation in early 2014.

 

[6] The Third Defendant (‘Turck Singapore’) is a private company established in Singapore and a wholly owned subsidiary of Turck Beteiligungsgesellschaft GmbH (“Turck GmbH”) of Germany. Turck GmbH deals with factory automation industries. Turck Singapore is the official source for Turck products in South East Asia.

 

[7] The Fourth Defendant is a Malaysian and an employee of the Third Defendant, Turck Singapore.

 

[8] The Fifth Defendant was a former employee and sales executive of SCL Malaysia until her resignation in early 2014.

 

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[9] The Sixth Defendant is a company incorporated in Malaysia and owned by Teo Siou Ween and Teo Kim Fuong. It is a tenant of the First Defendant.

 

[10] The Seventh Defendant is a company incorporated in Malaysia. Regaltech Malaysia is a shareholder of the Seventh Defendant, and the Second Defendant is one of its directors.

 

Claim against the Third and Fourth Defendant – the Turck Supply Chain

 

[11] On 30.1.2013, the Fourth Defendant, as a representative of the Turck Singapore, attended a meeting to present Turck products to Bromma Malaysia Sdn Bhd (‘Bromma Malaysia’). SCL Singapore claims that Bromma Malaysia is one of its main customers.

 

[12] The Plaintiffs claim that it was agreed that any purchase of Turck products by Bromma Malaysia will be made through the SCL Singapore to Turck Singapore via Regaltech Penang. These, according to the Plaintiffs, give rise to the “Turck Supply Chain”.

 

[13] Turck Singapore however claims that any purchase orders they received from Regaltech Penang is premised on the fact that since September 2012, Turck Singapore has appointed Regaltech Penang as its authorised distributor of Turck products in Malaysia. So Turck Singapore claims that there is no such “Turck Supply Chain”.

 

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[14] Vide a letter dated December 2013, Turck Singapore appointed the First Defendant, RegalTech Malaysia to be its authorised distributor for Turck products.

 

[15] Following discussions between Turck GmbH and Bromma Malaysia in January/February 2014, Regaltech Malaysia was appointed a supplier of Turck products to Bromma.

 

[16] The Plaintiffs claim that SCL Singapore has been removed from the Turck Supply Chain and now claim against the Turck Singapore and the Fourth Defendant for breaches of contract in respect of the “Turck Supply Chain”.

 

Claim against First, Second, Fifth, Sixth and Seven Defendants

 

[17] In 2012, the Plaintiffs, the Second Defendant and Chow Chen Nom agreed to enter into a business venture using SCL Malaysia, whereby the SCL Malaysia will assist in the marketing and selling of SCL Singapore products (“SCL Products”) in Malaysia which among others, includes the Q-Light products.

 

[18] The agreed business venture between the parties was that SCL Malaysia will be the appointed sub distributor of SCL Singapore in Malaysia in respect of the Q-Light products. All purchases from the Regaltech Malaysia or Regaltech Penang would be made through SCL Malaysia.

 

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[19] SCL Singapore also owns the E-portal which contain the Confidential Information of the SCL Singapore business. With its business arrangement with SCL Malaysia, the Plaintiffs’ claim that the Regaltech Malaysia, the Second and the Fifth Defendants have access to the e-portal, in order to view the stock level and pricing of the SCL Products, before placing their orders through SCL Malaysia. The E-Portal was closed down on 16.12.2013.

 

[20] The Plaintiffs claimed that Regaltech Malaysia had signed a nondisclosure agreement dated 31.1.2013 with the SCL Singapore, to view and purchase the products including but not limited to the Q-Light products through the said E-Portal.

 

[21] The Plaintiffs claim that the Defendants have conspired and misused the Confidential Information in the E-Portal for their business dealings with third parties, thereby causing injury to the Plaintiffs’ business,

 

Issues to be tried

 

[22] The agreed issues to be tried are as follows:

 

(i) Whether the First Defendant (RegalTech Malaysia), Second and Fifth Defendants jointly or severally owed a duty of care or a fiduciary duty or both to the either Plaintiffs or SCL Malaysia and whether the First, Second and Fifth Defendants jointly or severally breached that duty of care or fiduciary duty or both to either Plaintiffs or SCL Malaysia

 

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and whether Second Defendant breached his duties as a director pursuant to s. 132 of the Companies Act l965?

 

(ii) Whether there was any agreement and/or control between the RegalTech Malaysia, Regaltech Penang and Turck Singapore in relation to the Turck products?

 

(iii) Whether there was any collaborative arrangement, agreement and/or contract in respect of the “Turck supply chain” and if so, what were the terms?

 

(iv) Whether E-Portal contains confidential information and whether the First and Fifth Defendants have jointly or severally breached the Non-Disclosure Agreement dated 21.1.2013 and 25.10.2012 or misused the First Plaintiff’s trade name by misrepresenting to the First Plaintiff’s customers or potential customers with regards to the First Plaintiff’s products?

 

(v) Whether the Defendants or any one or more jointly or severally colluded and conspired to defraud and financially injure either Plaintiff by soliciting away the First Plaintiff’s business and caused loss and damage to the Plaintiffs?

 

(vi) Whether the Defendants or any one or more of them jointly or severally had unlawfully interfered with the First Plaintiff’s trade and business and caused loss and damage to the First Plaintiff?

 

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(vii) Whether the First, Second and Fourth Defendants or any one or more of them had jointly or severally induced the Third Defendant to breach any contract and/or agreement?

 

Findings of the Court

 

Plaintiff’s Claim against the Third and Fourth Defendant – the “Turck Supply Chain” – issues (ii), (iii), (v), (vi) and (vii)

 

Issues (ii) and (iii)

 

[23] The core issue here is whether there was any collaborative arrangement, agreement and/or contract in respect of the “Turck supply chain” and if so, what were the terms?

 

[24] To answer this core issue, this Court will have to ascertain whether there is a contractual relationship between SCL Singapore and Turck Singapore with regards to the “Turck Supply Chain”.

 

[25] It is the Plaintiffs’ case that Turck Singapore, through the Fourth Defendant had proposed a collaboration and/or an arrangement where the parties have agreed to a formal relationship with regards to the Turck Supply Chain. In his evidence (WSPW1), PW1 said:

 

Q30: Can you tell this Honourable Court what is the Turck Supply Chain?

 

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A30: The Turck Supply Chain is a term coined to describe a collaboration agreement between SCL Singapore, Turck [Singapore] and Regaltech Penang. This collaboration arrangement is for the supply of Turck products to a major customer of SCL Singapore, i.e Bromma [Malaysia].

 

[26] The Turck Supply Chain is for the supply of Turck products to

 

Bromma Malaysia, through Regaltech Penang. The Turck Supply

 

Chain operates in the following manner:

 

(i) any sale orders from Bromma Malaysia for Turck Products with be sent to SCL Singapore, which shall be routed to Regaltech Penang, who will issue a purchase order to Turck Singapore;

 

(ii) any delivery of Turck Products will be made directly from Turck Singapore to SCL Singapore, who will deliver the products to Bromma Malaysia;

 

(iii) Under the Turck Supply Chain, the SCL Singapore would manage all communication and dealings with Bromma Malaysia while Regaltech Penang would manage all issues with Turck Singapore; and

 

(iv) at all material times, under the Truck Supply Chain, the Second Defendant or Turck Singapore and Fourth Defendants would not deal directly with Bromma Malaysia unless it was in the presence of SCL Singapore representative.

 

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[27] The Plaintiffs submit that despite the absence of a formal written agreement, the existence of such agreement is confirmed by the following factors:

 

(i) the arrangement of presentation of Turck products to Bromma following the agreed collaboration between the parties;

 

(ii) email correspondence between the Plaintiffs and Turck Singapore and the Fourth Defendant confirming the Agreement in respect of the agreed collaboration for the supply of Turck products to Bromma;

 

(iii) documentary evidence in the form of purchase orders, delivery orders and payments made in respect of the supply of Turck products pursuant to the parties agreed collaborations;

 

(iv) evidence of PW1, PW2 and PW3 in respect of such agreed collaboration; and

 

(v) the Defendant’s failure to call Andrew Lim, the Third Defendant’s then Managing Director who was instrumental to the parties collaboration agreement.

 

[28] It is not in dispute that there is no written agreement on the alleged Turck Supply Chain. In such a situation, this Court will have to examine the factual matrix, the background circumstances and the nature of the alleged contract in order to

 

10

 

ascertain the alleged contractual relationship between the parties. The English High Court in Spectra International pic v Tiscali UK Ltd and another [2002] All ER 209 said as follows:

 

“If the court is able to find that at the material time there was a clear evincement by the parties of a common intent, it will decide the issue accordingly, but the cases which come to trial are often ones where there has been no such clear evincement of common intent. In such cases the court examines the background circumstances, the nature of the alleged contract and the negotiations between the parties, and seeks to infer what a reasonable person (a projection of the judge) would have taken their common intention to be, if they has been asked to express it, remembering always that the burden of establishing the existence of a contract lies with the party which asserts it.

 

This was not a simple agreement for a transaction of an everyday kind. It was more in the nature of a joint venture agreement. It was inherently improbable that parties would wish to enter into such a joint venture without a written contract defining their respective rights and obligations, the duration of the agreement and their remedies in the event of default by the other party. The written contract would require to be individually tailored”. (emphasis added)

 

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[29]

 

[30]

 

[31]

 

[32]

 

Bearing in mind that the Plaintiffs has pleaded the Turck Supply Chain in paragraph 28 of their Statement of Claim, the burden of establishing the existence of such a contract lies with the Plaintiffs who asserts the same.

 

However, apart from paragraph 28 of the Statement of Claim, there are no other contemporaneous documents or documentary evidence before this court where the phrase ‘Turck Supply Chain’ can be found. Indeed, the Plaintiffs’ witness, PW1 admitted in evidence that there is no reference to the phrase Turck Supply Chain in any of the Court documents. PW1 said this:

 

Q: Is there in any of these three documents, a reference to the

 

words, ‘Turck Supply Chain’?. Is there is any of these documents here, I am holding up a reference for the use of the word ‘Turck Supply Chain’?

 

PW1: No.

 

This is consistent with the evidence of Matthias Turck (DW9) and Thomas Winemar (DW10), representing Turck Singapore and supported by the evidence of Dominic Lim (DW1) representing the buyer, Bromma Malaysia. All these witnesses gave evidence that they have no knowledge of the alleged ‘Turck Supply Chain’.

 

With regards to the arrangement of presentation of Turck products to Bromma Malaysia, I agree with the Defendants that this is merely a presentation of Turck products to Bromma Malaysia. Bearing in mind that DW1, representing the buyer, Bromma Malaysia confirms that there is no such Turck Supply

 

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Chain, nothing much can be inferred from the presentation on 30.1.2013.

 

[33] Next, the Plaintiff relied on the email correspondence between the Plaintiffs and Turck Singapore and the Fourth Defendant to confirm the existence of the alleged Agreement of the collaboration for the supply of Turck products to Bromma Malaysia, that is, the ‘Turck Supply Chain’. In paragraph 25(a) of the SOC, the Plaintiffs has pleaded one of the key feature of the alleged contract, that there is a ‘promise of a mutually beneficial relationship’ between SCL Singapore and Turck Singapore represented by the Fourth Defendant on behalf of Turck Singapore.

 

[34] The alleged representations are from the emails that can be seen at pages 49 – 61 of Bundle B1. However, having read the said emails, I agree with the Defendants that the email exchanges between the Fourth Defendant, Alex To and SCL Singapore between 22.1.2013 to 26.2.2013 do not reflect the alleged ‘promise of a mutually beneficial relationship between SCL Singapore and Turck Singapore’. The said email exchanges relate to operational matters as can be seen from the evidence of the Fourth Defendant in his Witness Statement, WSDW8.

 

[35] Added to that, both the Plaintiffs’ witnesses gave evidence that there was no discussion on any ‘mutually beneficial relationship between SCL Singapore and Turck Singapore’ nor the terms of the contract. This can be seen from the evidence of PW1 under cross examination:

 

13

 

Q: What is the word collaborate mean, in your understanding?

 

A: Working towards a common goal.

 

Q: Working towards a common goal. Are the words, promise of

 

a mutually beneficial relationship between SCL Singapore and Turck Singapore, do these words appear in the email? Yes or no, Mr. Shawn Chew? I think your answer is no.

 

A: Yes.

 

Q: Agree? These words do not appear in this email. Correct?

 

A: Yes.

 

[36] It is also the submission of the Plaintiffs that the contractual relationship can be seen from the documentary evidence in the form of purchase orders, delivery orders and payments made in respect of the supply of Turck products.

 

[37] However, I agree with the Defendants that these documents do not bind the parties into a contractual relation. These documents are nothing more than ad hoc purchases. Added to that, it is not in dispute that SCL Singapore was merely acting as a trading house for Bromma Malaysia. According to DW9, Matthias Turck, a trading house is an entity which acts as an agent to buy items or supplies. DW9 said that SCL Singapore was buying Turck products as well as other products for Bromma Malaysia. This was corroborated by DW1, Dominic Lim, representing Bromma Malaysia. Therefore, nothing more can be inferred from the purchase orders, delivery orders and payments made in respect of the supply of Turck products, as they reflect the normal business transactions between the parties.

 

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[38] The Plaintiffs further submit that the evidence of PW1, PW2 and PW3 shows that there was an agreed collaboration. However, I agree with the Defendants that there are major contradictions in the evidence of PW1 and PW2 with regards to a very crucial issue, that is who exactly are the contracting parties to the Turck Supply Chain. In his evidence, under cross examination, PW1 said this:

 

Q: … who are the contracting parties to this collaboration

 

arrangement? Who are the parties, Mr. Shawn Chew?

 

A: Who are the parties, SCL Singapore, Regaltech Penang and

 

Turck Singapore.

 

[39] This is in direct contradiction to the evidence of PW2, who testified under cross examination that there are six (6) contracting parties:

 

Q: Ok. Let me repeat my question. Base on what you have said

 

in paragraph 28, it suggests that there are six contracting parties. Parties to the collaboration arrangement. You have the two Plaintiffs, you have Chow, and then you have the three defendants.

 

A: Yes.

 

[40] Therefore, if the Plaintiffs’ witnesses cannot even identify the parties to the alleged collaboration, I have grave doubts on the existence of the same.

 

[41] The Plaintiffs further submit that the Defendant’s failure to call Andrew Lim, Turck Singapore then Managing Director who was

 

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said to be instrumental to the parties collaboration agreement, shows that the Defendants fail to rebut the existence of the collaboration. However, I am of the considered opinion that it is not for the Defendant to disprove the alleged Turck Supply Chain. The burden lies with the Plaintiff to establish the existence of the Turck Supply Chain. If Andrew Lim is crucial to their case, then it is up to the Plaintiff to call Andrew Lim as their witness.

 

[42] Added to that, crucial to the alleged Turck Supply Chain is Bromma Malaysia, who is supposed to buy the Turck products from Turck Singapore through SCL Singapore. But the evidence of DW1, the Sourcing Manager of Bromma Malaysia confirmed that there was no such collaboration. Under examination in chief, DW1 said this:

 

LCW: …. Ok. Have you heard of a term Turck Supply Chain?

 

LIM: No.

 

[43] Indeed in his evidence, DW1 said that Bromma Malaysia would prefer to deal with Turck Singapore directly:

 

LCW: … In respect of Turck products which Bromma Malaysia purchased through SCL Singapore, did Bromma Malaysia agreed with SCL Singapore that in respect of those products, Bromma Malaysia will not communicate with Turck?

 

LIM: Let me make it like this, we will communicate with Turck who is the appointed distributor.

 

LCW: And of course Turck being the manufacturer is the party you would want to communicate with, correct?

 

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LIM: Correct.

 

[under cross examination]

 

HRD: Ok. So would I be correct in saying that because Turck Singapore is not an approved vendor of Bromma, they would need some kind of assistance to become a Bromma approved vendor directly or indirectly.

 

LIM: No, Turck can do with Bromma directly.

 

LIM: Yes, we would be happy if we can deal with Turck directly.

 

[44] Therefore, there is no basis to the Plaintiffs’ claim that Turck Singapore required and relied on SCL Singapore to sell its products to Bromma Malaysia, which allegedly form the basis of the Turck Supply Chain. In fact, the evidence clearly shows that the buyer, Bromma Malaysia prefers to buy the Turck products directly from Turck Singapore agent in Malaysia, Regaltech Malaysia instead of going through a third party, SCL Singapore. In his evidence, DW1 (LIM) from Bromma Malaysia said that they will compare prices among the distributors to ascertain the lowest price:

 

LIM : Yes, we do sign a Light Purchase Agreement with Regaltech Malaysia.

 

LCW: Ok. Now if you had purchased that these Turck products from Turck via Regaltech Malaysia and with SCL Singapore with a come in as well for the products to pass through, your purchase price would be higher, is that correct?

 

LIM: I can answer like, I will compare the price among the distributors.

 

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LCW: Yes

 

[45]

 

[46]

 

LIM: So the lowest is Regaltech.

 

Further, evidence also shows that since SCL Singapore do not have the technical expertise with regards to the Turck products, therefore their participation cannot be said to be crucial or essential to the buying and selling of Turck products between Turck Singapore and Bromma Malaysia. The position of SCL Singapore is nothing more than that of an intermediary, which the trading parties have the freedom of choice to dispense with.

 

It is also the Plaintiffs’ main contention that without them, Turck Singapore would not have established a business relationship with Bromma Malaysia. Therefore, the Plaintiffs arranged a meeting between Turck Singapore and Bromma Malaysia because it was promised the Turck Supply Chain. However, this contention is without merit as it is the evidence of DW1, from Bromma Malaysia that the Turck Group and the Bromma Worldwide had a business relationship before 2013:

 

LCW: Are you aware that Turck, the Turck Group, there’s a Turck Singapore and Turck Group Worldwide and then of course like Bromma Malaysia is part of Bromma Worldwide. Are you aware that Turck Group and Bromma Group had a business relationship before 2013?

 

LIM: Yes, I’m aware, its 2010.

 

LCW: Ok. Can you turn to page 413 of the same bundle? Page 413 are email correspondence between you and Thomas Winemar of Turck in July 2011, am I correct?

 

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LIM: Correct.

 

LCW: And these emails show that Bromma Malaysia has a relationship with Turck Group in 2011, am I correct?

 

LIM: Correct.

 

[47] Premised on the reasons above, I am of the considered opinion that there is no evidence to support the Plaintiffs’ claim that there was a contractual arrangement with regards to the Turck Supply Chain. The Plaintiffs’ own witnesses cannot agree to the number of parties to the alleged agreement, gave contradicting evidence on the date of the collaboration, with PW1 giving evidence that the collaboration was made on 29.4.2013 whilst PW2 said the collaboration started from the emails on 23.1.2013. Further, the Plaintiffs’ own witnesses simply have no idea of the duration of the collaboration, except to say that it was meant to be a long term business. As such, I agree with the Defendants that there cannot be any agreement when there is no clarity with regards to the parties, the terms, the date of formation and the duration of the alleged agreement.

 

Issue (v)

 

[48] The next issue is whether the Defendants or any one or more jointly or severally colluded and conspired to defraud and financially injure either Plaintiffs’ by soliciting away SCL Singapore’s business and caused loss and damage to the Plaintiffs.

 

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[49] In order for the Plaintiffs to succeed in a claim based on the tort of conspiracy, the Plaintiffs must establish the following elements:

 

(a) an agreement between two or more persons;

 

(b) for the purpose of injuring the plaintiff; and

 

(c) acts done in the execution of that agreement resulted in damage to the plaintiff. (see SGK Group Bhd & Anor v Sunny Liew Siew Pang [2010] 9 CLJ 389)

 

[50] It is the Plaintiffs’ contention that the Defendants, who have entered into a mutually beneficial collaboration agreement with the Plaintiffs cannot go behind the Plaintiffs’ back and supply Turck products directly to Bromma Malaysia as they had agreed to supply through SCL Singapore and Regaltech Penang.

 

[51] In view of my finding that there was no agreement with regards to the Turck Supply Chain, then there is no unlawful acts committed by the Defendants when Turck Singapore sold their Turck products to Bromma Malaysia through their distributor, Regaltech Malaysia instead of SCL Singapore.

 

[52] Added to that, I am also of the considered opinion that the Plaintiffs have failed to show the agreement between the Defendants to injure the Plaintiffs because the evidence clearly shows the it was Bromma Malaysia who choose to deal directly with Turck Singapore, through their Malaysian distributor, Regaltech Malaysia, instead of SCL Singapore, for the purchase

 

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of Turck products. There is nothing wrong with this as it makes more business sense for Bromma Malaysia to deal direct with Turck Singapore to buy their products than to go through SCL Singapore.

 

Issue (vi)

 

[53] The next issue is whether the Defendants or any one or more of them jointly or severally had unlawfully interfered with the First Plaintiff’s trade and business and caused loss and damage to the First Plaintiff.

 

[54] It is the Plaintiffs’ submission that the Plaintiffs’ trade and business had been harmed by the Defendants conducts when they induced the Plaintiffs to believe that there is a mutually beneficial collaboration agreed by the parties.

 

[55] In Leo Pharmaceutical Products v Kota Pharma Sdn Bhd

 

[2009] 5 MLJ 703, on the issue of a claim of unlawful interference with trade, the Court held as follows:

 

“[80] Under this head of the defendant’s counterclaim, I am of the view that the burden is on the defendant to establish that:

 

(a) the plaintiff has interfered with the defendant’s trade or business;

 

(b) the plaintiff has used unlawful means;

 

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(c) the plaintiff’s intention was to injure the defendant; and

 

(d) the defendant has actually been injured by the plaintiff.”

 

[56] Having considered the evidence, I am of the considered opinion that the Plaintiffs have failed to establish the mutually beneficial collaboration agreed by the parties. Added to that, the Plaintiffs have failed to prove whether Turck Singapore or the Fourth Defendant have interfered with the Plaintiffs’ trade bearing in mind that the evidence shows that it was Bromma Malaysia who has preferred to deal directly with Turck Singapore Malaysian distributor, Regaltech Malaysia on the purchase of the Turck products. The Plaintiffs have also failed to establish that either Turck Singapore or the Fourth Defendant have used unlawful means to injure the Plaintiffs business. As such, I find that the Plaintiffs have failed to establish that the Defendants have unlawfully interfered with the First Plaintiff’s trade and business and caused loss and damage to the First Plaintiff.

 

Issue (vii)

 

[57] The next issue is whether the First, Second and Fourth Defendants or any one or more of them had jointly or severally induced the Third Defendant to breach any contract and/or agreement.

 

[58] It is common ground that before the Defendants can be said to have induced Turck Singapore to breach the Turck Supply Chain

 

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agreement, it is incumbent on the Plaintiffs to prove the existence of such a concluded contract. In Loh Holdings Sdn Bhd v Peglin Development Sdn Bhd & Anor [1984] 2 MLJ 105, the Court held as follows:

 

“At common law it constitutes a tort for a third person deliberately to interfere in the execution of a valid contract which has been concluded between two or more other parties…”

 

[59] It is the submission of the Plaintiffs that the Second and Fourth Defendants have induced Turck Singapore to breach the Turck Supply Chain agreement, resulting in Bromma Malaysia doing business directly with Turck Singapore, thereby excluding the role of SCL Singapore as one of the agents of Bromma Malaysia. This had caused SCL Singapore to lose business transactions from the sale of Turck products to Bromma Malaysia.

 

[60] However, in view of my finding that there was no concluded agreement with regards to the Turck Supply Chain, then there is no issue with regards to the issue of inducement to breach the said agreement. Added to that, I agree with the Defendants that it is not in dispute that Bromma Malaysia is at liberty to purchase Turck products from anyone, and not exclusively from SCL Singapore as there is no exclusive purchase agreement between SCL Singapore and Bromma Malaysia.

 

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Claim against the First, Second, Fifth, Sixth and Seventh Defendants – issues (i) and (iv)

 

[61] Issue (i) involves the following sub issues:

 

(a) Whether the First Defendant (Regaltech Malaysia), Second and Fifth Defendants jointly or severally owed a duty of care or a fiduciary duty or both to the either Plaintiffs or SCL Malaysia;

 

(b) whether the First, Second and Fifth Defendants jointly or severally breached that duty of care or fiduciary duty or both to either Plaintiffs or SCL Malaysia; and

 

(c) whether Second Defendant breached his duties as a director pursuant to s. 132 of the Companies Act l965?

 

[62] With regards to the issue of duty of care or fiduciary duty, premised on the pleaded case of the Plaintiffs, the claim for breach of fiduciary duties is only against the Second Defendant. There is nothing in the Amended SOC that alleged either the First Defendant or the Fifth Defendant, whether jointly or severally, owed a duty of care or a fiduciary duty or both to either the Plaintiffs or SCL Malaysia.

 

[63] The Plaintiffs’ pleaded case is only against the Second Defendant, Sun Cheng Leng, as can be seen from paragraphs 47 and 45 of the Amended Statement of Claim. Paragraph 47 reads:

 

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“ The 2nd Defendant has by his conduct or act as set out in paragraph 45 above acted in breach of his fiduciary duties to the 1st Plaintiff and/or SCL Malaysia”

 

[64] The particulars of the alleged breaches of fiduciary duties are set out in paragraph 45 and in paragraph (61) of the Amended SOC, the Plaintiffs seek to declare that the Second Defendant “had breached his fiduciary duties against the Plaintiffs and SCL Malaysia.”

 

[65] The issue here is whether the Second Defendant owe any fiduciary duty to the Plaintiffs and SCL Malaysia, before we can deal with the issue of a breach of the said fiduciary duties.

 

[66] In Solid Investments Ltd v Alcatel – Lucent (M) Sdn Bhd (previously known as Alcatel Network Systems (M) Sdn Bhd

 

[2014] 3 MLJ 785, the Federal Court held as follows:

 

“[29] The class of fiduciary relationships is never closed. (English v Dedham Vale Properties Ltd [1978] 1 All ER 382, per Slade J). As can be seen from the English cases, the English judges have never attempted to formulate a comprehensive definition of who is a fiduciary.

 

In Snell’s Equity (32nd Ed)[2010] Thompson Reuters at pp 172 to 178, the learned author stated that the accepted categories in which the courts presume the existence of a fiduciary relationship are as follows:

 

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(a) director vis-a-vis their companies;

 

(b) solicitor – client relationships;

 

(c) agent – principal relationship; and

 

(d) partnership.

 

[30] Notwithstanding that there are authorities to say that fiduciary duties may be owed where the

 

circumstances justify the imposition of such duties.

 

… There is, however, growing judicial support for

 

the view that:’ a fiduciary is someone who has undertaken to act for or on behalf of another in a particular matter in circumstances which give rise to a relationship of trust and confidence’… ”

 

(emphasis added)

 

[67] The principle in Solid Investment Ltd (supra) was applied by the Court of Appeal in Mahmood bin Hj Hashim v Perbadanan Islam Johor [2015] 3 MLJ 52, where the Court held this:

 

“[21] We refer to the case of Solid Investments Ltd v Alcatel – Lucent (M) Sdn Bhd (previously known as Alcatel Network Systems (M) Sdn Bhd [2014] 3 MLJ 785; [2014] 3 CLJ 73, wherein the Federal Court referred to Snell’s Equity (32nd Ed) [2010] Thompson Reuters. At pp 172 to 178, the learned author stated that the accepted categories in which the courts presume the existence of a fiduciary relationship are as follows:

 

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(a) director vis-a-vis their companies;

 

(b) solicitor – client relationships;

 

(c) agent – principal relationship; and

 

(d) partnership.

 

[22] It is not disputed that the defendant was a director and general manager of the plaintiff. Following the abovementioned authority, it is clear that there existed a fiduciary relationship between the plaintiff and the defendant.”

 

[68] In the present case, the Second Defendant is not a director of SCL Singapore. There is also nothing in the evidence to show that the Second Defendant had personally undertake to act on behalf of the Plaintiffs which give rise to a relationship of trust and confidence. As such, I am of the considered opinion that the Second Defendant does not owe any fiduciary duties towards the First Plaintiff, SCL Singapore.

 

[69] The only nexus between the Second Defendant and the Plaintiffs is that both the Second Defendant and the Second Plaintiff were directors of SCL Malaysia before January 2012. However, I agree with the Defendant that the Second Defendant does not owe any fiduciary relationship towards the Second Plaintiff, arising from their positions as directors of SCL Malaysia. In Tan Ah Chio & Ors v Lua Kim Soon [2015] 1 MLJ 334, the Court of Appeal held that:

 

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“[22] It is trite law that directors of a company do not owe any fiduciary duties to members of the company individually or collectively…”

 

[70] With regards to the Plaintiffs’ prayer that the Second Defendant had breached his fiduciary duties against the SCL Malaysia, again there is no legal basis for this as SCL Malaysia is not a party in this action. SCL Singapore and SCL Malaysia are separate legal entities and SCL Singapore has no legal standing to sue the Second Defendant for breach of fiduciary duty in his capacity as a director of SCL Malaysia. Only SCL Malaysia can sue the Second Defendant for breach of fiduciary duties. Therefore, the Plaintiffs’ claim in paragraph 48 of the Amended SOC that the Second Defendant had acted in breach of his statutory duties under section 132 of the Companies Act 1965 is obviously unsustainable.

 

[71] Issue (iv) incorporate the following sub-issues:

 

(a) Whether E-Portal contains confidential information;

 

(b) whether the First, Second and Fifth Defendants have jointly or severally breached the Non-Disclosure Agreement dated 21.1.2013 and 25.10.2012; or

 

(c) whether the First, Second and Fifth Defendants have jointly or severally misused the First Plaintiff’s trade name by misrepresenting to the First Plaintiff’s customers or potential customers with regards to the First Plaintiff’s products?

 

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[72] It is the Plaintiffs’ case that at all material times, the First, Second and Fifth Defendants, together with Regaltech Penang, were bound by the Non-Disclosure Agreements entered between the parties and/or the companies which employed the respective defendants in order to protect the SCL Singapore confidential information in the E-portal.

 

[73] However, from the evidence tendered in this Court, there are two Non Disclosure Agreements, both dated 21.1.2013, which were executed between SCL Singapore and Regaltech Malaysia, the First Defendant. The Second and the Fifth Defendants did not execute any Non Disclosure Agreement with the Plaintiffs. There is also no evidence that the Fifth Defendant was an employee or representative of Regaltech Malaysia, the party who had signed the Non Disclosure Agreements. Therefore, there is no legal basis for the Plaintiffs’ claim against the Second and the Fifth Defendants for a breach of the Non Disclosure Agreement as pleaded in paragraph 50 of the Amended SOC.

 

[74] Before we deal with to the issue of breach of Non Disclosure Agreement by Regaltech Malaysia, we need to ascertain the extent of the Confidential Information in the E-Portal of SCL Singapore.

 

[75] It is the pleaded case of the Plaintiffs that the Confidential Information in the E-Portal of SCL Singapore are in relation to the “list of products, pricing, vendors, customers, potential customers and pricing data (“Confidential Information”)’’ (see 43 Amended SOC)

 

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[76] However, the contents of the E-Portal of SCL Singapore are not before this Court, simply because it is the Plaintiffs’ case that it contained confidential information and must remain so. Therefore, even this Court has no access to the information in the E-Portal in order to ascertain whether it contains the confidential informations as pleaded in paragraph 43 of the Amended SOC.

 

[77] So the best that we can do (in order to ascertain the confidential information) is to assess the evidence of the Plaintiffs’ witnesses. Under cross examination, PW1 said that the E-Portal contained confidential information of the stock price and also item assigned to authorize distributors and authorized personnel to access the portal. PW3 gave evidence that the E-portal has product stock level and the cost price.

 

[78] Therefore, the evidence of the Plaintiffs’ witnesses does not establish the pleaded case of the Plaintiffs, that the Confidential Information are in relation to the “vendors, customers, potential customersWith regards to “pricing and pricing data”, PW3 said that the E-Portal contain cost price. But the minutes of meeting on 2.1.2013 shows that the “…Price set in e-portal for Regaltech companies will be based on Singapore Pricelist less 40%, any special price will have to check with Eric.” And PW3, under cross examination agreed that the price in the e-portal is not the special price as one still have to ask Eric. Therefore, I agree with the Defendants that the price in the e-portal cannot be the cost price as alleged by PW3, because if it is already costing price, it is impossible to give further discounts or special price below costing price. It simply does not make any commercial

 

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sense. Added to that, if the price in the E-Portal is confidential, why is there a special price which must be referred back to the Second Plaintiff?

 

[79] Further, under cross examination, the Second Plaintiff (PW2) has agreed that the prices quoted to Third Party supplier are prices which can be surveyed from the Malaysian market. Therefore, if the prices can be surveyed from the Malaysian market, then there is the no value of the alleged confidential information in the E-Portal. As such, I am of the considered opinion that the Plaintiffs have failed to establish that the E-Portal contained confidential information as pleaded.

 

[80] The Plaintiffs also submit that the First, Second and Fifth Defendants have jointly or severally breached the Non-Disclosure Agreement dated 21.1.2013 and 25.10.2012 when they had misuse the confidential information of SCL Singapore in the E-Portal. In view of my finding above that the Plaintiffs have failed to establish the pleaded Confidential Information in the E- Portal, I am therefore of the considered opinion that there is no issue with regards to a breach of the Non-Disclosure Agreement, which was only signed by Regaltech Malaysia. The Plaintiffs’ reliance on the list of names of the customers is also misplaced as there was no evidence that the list of names of the customers were part of the Confidential Information. In any event, DW1, DW2 and DW5 gave evidence that the customers list were provided by them, as SCL Singapore was based in Singapore and had required their assistance and connectivity to penetrate the Malaysian market by establishing SCL Malaysia.

 

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[81] It is also the Plaintiffs’ case that it is reasonable to conclude that the First, Second and Fifth Defendants had conspired to misuse SCL Singapore confidential information. In view of my finding that the Plaintiffs have failed to establish that the E-Portal contain confidential information, the claim premised on conspiracy must also fail.

 

[82] The Plaintiffs also claim that the First, Second and Fifth Defendants have misused SCL Singapore trade name, that is SCL System, by misrepresenting to SCL Singapore customers or potential customers with regards to the SCL products. This is pleaded in paragraph 45.1(i) of the Amended SOC:

 

“That the 1st Defendant or the 2nd Defendant had misused the trade name “SCL System” to deliberately confuse the public into thinking that the 1st or 2nd Defendants are somehow associated or connected with the 1st Plaintiff when no such association/connection exist;”

 

[83] It is the submission of the Plaintiffs that the Defendants have misused SCL Singapore trade name when they continued to advertise Q-Light products on their website after SCL Singapore and Regaltech Malaysia agreed to end their business venture in SCL Malaysia. By continuing to advertise the Q-Light products, the Plaintiff submits that it has cause misrepresentation that the First or Second Defendants are somehow associated or connected with the SCL Singapore.

 

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[84] However, I agree with the Defendants that SCL Singapore trade mark is SCL System, not Q—Light, which is the name of the product. So there is no issue of any misuse of the trade name, SCL System.

 

Conclusion

 

[85] Premised on the reasons enumerated above, I find that the Plaintiffs have failed to prove their case on the balance of probability and their claims against the Defendants are dismissed with costs.

 

(AZIZAH BTE HAJI NAWAWI) JUDGE

 

HIGH COURT MALAYA (Commercial Division) KUALA LUMPUR

 

Dated: 20 April 2016

 

For the Plaintiffs : HR Dipendra/KP Yap/Emelia Mohd Shariff

 

Messrs Arianti Dipendra Jeremiah Kuala Lumpur.

 

For the Defendants

 

1, 2, 5, 6 & 7 : Ng Kee Way/Khoo Ai Teng

 

Messrs Ng Kee Way & Co Tampin, Negeri Sembilan.

 

For the Defendants 3 and 4 : Lim Chee Wee/Kwan Wilson

 

Messrs Skrine Kuala Lumpur.

 

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