DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR
(BAHAGIAN RAYUAN DAN KUASA-KUASA KHAS) RAYUAN SIVIL NO. R3(2)-12-224-2006
INNOVATIVE ACCESS SDN BHD … PERAYU/
(No. Syarikat: 482573-K) PLAINTIF
DATO’ YAHYA BIN A. JALIL … RESPONDEN/
(K.P. No. 560819-01 -6437) DEFENDAN
(Dalam Perkara di Mahkamah Sesyen di Kuala Lumpur Saman No: 1-52-23286-04)
INNOVATIVE ACCESS SDN BHD … PLAINTIF
(No. Syarikat: 482573-K)
KONSORTIUM HUJUNG TANAH SDN BHD (No. Syarikat: 437545-M)
DATO’ YAHYA BIN A. JALIL (K.P. No. 560819-01-6437)
GROUNDS OF DECISION
The appeal here was against the decision of the learned Sessions Court Judge who allowed the 2nd Defendant’s application to strike out the Statement of Claim insofar as it affected the 2nd Defendant/Respondent.
The appeal was dismissed with costs to be taxed. The 2nd Defendant’s ground was essentially one of absence of privity of contract between him and the Plaintiff, since the contractual link was between the Plaintiff and the 1st Defendant (a Company called Konsortium Hujung Tanah Sdn Bhd). The 2nd Defendant was merely a Director and an indirect shareholder in the 1st Defendant Company. This was a plain and obvious case where a claim was being made against a Director of the Company, although the services rendered (the so-called “media services” in relation to what was described as “Tanjung Puteri Launch & Signing Agreement “) was to the 1st Defendant Company.
I could not find any grounds, whether on the evidence or on the law, to interfere with the decision of the learned Sessions Court Judge.
In the Plaintiff’s Statement of Claim, the claim was instituted against both Defendants for the earlier-mentioned media services. The claim itself was for the balance sum alleged to be owing to the Plaintiff, after deductions for payments earlier made.
It was the Plaintiff’s/Appellant’s position that the contract was entered into between the Plaintiff and the 2nd Defendant, and that the 2nd Defendant had made payments on this basis. Further, the invoices were
also sent personally to the 2nd Defendant, thus indicating that the contract for the media services was entered into in his personal capacity. The 2nd Defendant maintained the opposite stand. The contract was to provide services to the 1st Defendant Company and was entered into between the Plaintiff and the 1st Defendant Company, with the 2nd Defendant merely acting as the Director and therefore the agent of the Company. On the invoices sent, these were to his attention in his capacity as agent of the Company. It was argued that the Plaintiff was ignoring the separate identity doctrine. The 2nd Defendant could not be held liable for the acts of the 1st Defendant Company on this basis, and therefore the claim against the 2nd Defendant should be struck out under Order 14, rule 21(1) (b) and/or (d) of the Subordinate Courts Rules 1980, on the grounds that the claim was “scandalous, frivolous or vexatious” and “otherwise an abuse of the process of the court.”
As for these grounds, suing a wrong party would be regarded as a frivolous or vexatious action. See Yeng Hing Enterprise Sdn Berhad v Liow Su Fah  2 MLJ 240.
After considering the Plaintiff’s Statement of Claim, the claim appeared to be based on a contract allegedly binding both the 1st and 2nd Defendants. The attempt to override the separate identity rule was most apparent in paragraph 3 of the Statement of Claim, reading:
“Pihak Defendan Kedua adalah Pengarah Defendan Pertama dan yang telah memesan perkhidmatan daripada Plaintiff bagi pihaknya dan syarikatnya.”
On its own pleading, the Plaintiff’s claim was vague. It argued the services were rendered for both Defendants, although the 2nd Defendant was merely a Director who allegedly accepted the Plaintiff’s proposal for the above said “Tanjung Puteri Launch”. In paragraph 4 of the Statement of Claim, however, it was expressly pleaded that the media advertising for this was done for the 1st Defendant. Although a Director of a limited Company could in very limited circumstances be held personally accountable to a Creditor, the facts of this particular case did not fit within this category. As stated by the High Court, for example, in Gilbert Engineering Co Inc v Zainuddin bin Ahmad & Others  7 CLJ 489, there must be some indication of an agreement or representation by the Director to show that he had assumed a duty to the Creditor. The Plaintiff must provide particulars in his pleading to establish that the Director owed him this duty qua Creditor. The fact that the Director paid part of the indebtedness by his own personal cheque, and the fact that invoices were personally sent to him in his name, were not conclusive on the issue.
The Plaintiff alleged in its Affidavit in Reply (No. 4) that the 2nd Defendant had made a payment of RM196,308.00 by a personal cheque, allegedly by Standard Chartered Bank Cheque No. 500489 dated 30.7.1999. See paragraph 5 of this Affidavit. However, no exhibit was produced to show this payment. On the contrary, the 2nd Defendant stated categorically in his Additional Affidavit (III), in paragraph 6.4, that he had made only a payment of RM20,000.00 to the Plaintiff on behalf of the 1st Defendant. As for the payment of RM50,000.00, which was disclosed in the pleading, the 2nd Defendant stated that it was actually issued by Ibex Corporation Amalgamated Sdn Bhd. The Plaintiff was challenged to show all the payments allegedly made by the 2nd
Defendant’s personal cheques, but no such evidence was provided by the Plaintiff.
Thus, it was manifestly clear on the evidence that the Plaintiff could not displace the normal rule of separate identity, as emphasised in such cases as Hew Sook Ying v Him Tin Hee  1 CLJ (Rep) 120, People’s Insurance Company (M) Sdn Bhd v People’s Insurance Company Ltd & Others  MLJ 68, and Abdul Manaf Mohd bin Ghows v Nusantara Timur Sdn Bhd & Others  3 MLJ 661, which were all cited by counsel for the 2nd Defendant/Respondent. This being so, the Plaintiff’s claim against the 2nd Defendant was in my opinion obviously unsustainable and merited striking out.
This appeal was heard in the absence of counsel for the Appellant, but nevertheless heard on the merits since both parties had filed full Written Submissions. Since Appellant’s counsel was absent, I proceeded to hear the oral submissions of counsel for the 2nd Defendant before deciding on the merits.
The Appellant applied subsequently by Summons in Chambers in Enclosure 22 to set aside this Court’s order dismissing the appeal dated 5.5.2009. The Supporting Affidavit by counsel (Enclosure 21) explained the reason for counsel’s absence as “kerana pada segala masa yang material saya memang keliru mengenai tarikh perbicaraan kes ini dengan satu lagi kes yang melibatkan anak guam yang sama (parapraph 9).”
I dismissed Enclosure 22 on 1.7.2009 with costs to be in the cause, since by the time the application was heard the order dismissing
the appeal had been perfected, and furthermore the appeal had been heard on the merits.
Dated 5th May 2009
( MOHAMAD ARIFF BIN MD YUSOF ) JUDICIAL COMMISSIONER HIGH COURT MALAYA KUALA LUMPUR
For the appellant/plaintiff:
Messrs. Nur Ashikin Alex & Rakan Rakan.
For the 2nd defendant/respondent: Frank C.H. Loh & Chan Lai Kuan Messrs. Stanley Chang & Partners.