IN THE HIGH COURT OF MALAYA AT JOHOR BAHRU
IN THE STATE OF JOHOR DARUL TA’ZIM
CIVIL SUIT NO: 22-40-2009
_______________________________________________________
BETWEEN
SENG YONG ENGINEERING CONSTRUCTION
WORKS SDN BHD
(Company No. 729178-H)
…
Plaintiff
AND
ECOMETRO (M) SDN BHD
(Company No. 287080-P)
…
Defendant
JUDGMENT
GUNALAN A/L MUNIANDY, J.C:
Background of Plaintiff’s Claim
[1]
The plaintiff (‘P’) was engaged by the Defendant (‘D’) the main
contractor, as sub-contractor for the project known as ‘Design Construction
and Commissioning of a New Railway Bridge at No. 1766, 1767 and 1768
at KM 724.41 and associated works near Kulai Railway Station’ (the said
project). In November 2006, the Defendant pursuant to an oral agreement
with the Plaintiff, nominated the Plaintiff as one of the sub-contractors to
supply construction materials and provide labour for the construction of a
new bridge for the said project at the contract sum of RM1,182,590.00.
Pursuant to the oral agreement and the said nomination, Plaintiff had
supplied all construction materials and provided labour and carried out the
said works with its own labour and equipment and completed all the works
on or about September 2007. The Defendant after having paid a sum of
RM774,000.00 to the Plaintiff had defaulted payment of the balance
contract sum of RM408,590.00 despite repeated demands for payment by
the plaintiff. Therefore, the plaintiff claims damages or a sum of
RM408,590.00 by way of damages together with interests and costs.
Defence Case
[2]
The total contract value had been agreed upon between the
parties at RM970,000.00 despite the absence of a formal written
agreement. The agreed price is inclusive of equipment, materials, labour
charges. Hence, P was not entitled to make separate claims for labour
charges. P had wrongfully submitted invoices in excess of the contract
price without D’s consent. Upon deducting the sum already paid to P, the
balance owing was only RM196,000.00.
[3]
P was said to have failed to provide certain machinery and
equipment that it was supposed to provide, compelling D to rent these from
third parties. The costs (rentals) incurred were borne by D. Therefore, D
was entitled to set-off a sum of RM300,000.00 from P’s claim. As a result,
P was liable to pay D a sum of RM104,000.00 for which D has counterclaimed.
[4]
P was alleged to have contributed to delay in completion of the
project for which D is entitled to liquidated damages as pleaded.
[5]
Further, that D was negligent in carrying out its scope of work
causing damage to the railway cable and liability for losses due to
derailment of train coaches. D also counter-claimed for general and other
damages flowing from losses suffered due to loss of reputation, cash flow
problems and numerous inconveniences alleged to have been caused by
P’s carelessness and negligence in discharging their obligations.
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Summary of Issues To Be Tried
[6]
1)
What was the scope of works and the value of the subcontract agreed to by both parties, whether it was
RM1,182,590.00 as claimed by P or RM970,000.00 as
claimed by D?
2)
Whether D is liable to settle all the invoices received from P?
3)
Whether D was estopped from disputing the invoices
totalling RM774,000.00 that D had fully settled?
4)
Whether P had a right to claim for equipment, materials and
labour?
5)
Whether the amount owing by D to P was RM408,590.00 or
RM196,000.00?
6)
Whether D was entitled to set-off against P’s claim the costs
that D had incurred in providing crane services?
7)
Whether D was entitled to counter-claim against D for
carelessness, negligence, etc. throughout the construction
work?
8)
Whether P was careless, negligent, etc. and if so, whether D
could claim damages for LAD imposed on D and other
losses that D had incurrent as set out in the particulars of the
counter-claim?
Analysis of Evidence and Findings on Issues
Value of the Sub-Contract
[7]
As there was no formal written sub-contract (‘S/C’) in existence,
the terms and conditions (‘T & C’) of the sub-contract were to be
determined from the available documents: quotation by P, purchase order
(‘P.O’) issued by D and the invoices issued by P to D. The contract
awarded to P consisted of 3 packages : new railway bridges at No. ‘1766’,
‘1767’ and ‘1768’. The dispute revolved around the total sub-contract price,
3
which P contended was RM1,182,590.00 while D contended it was
RM1,045,00 only the difference being RM137,590.00.
[8]
D disputed the S/C price computed by P as per PW1’s evidence
based on the invoices on the ground that several invoices were invalid for
two reasons: the invoices went over and beyond the agreed price and
certain works carried out by P for which there was neither request nor
variation order issued by D. For ease of reference the disputed invoices
were Exhibits P1, P5, P6A –B, P7A –B, P11A – B, P12A – B and P13A – B.
[9]
Exhibits P1 and P5 relate to Bridge No. 1766 and were challenged
for being “double or overlapping claims” for the same works under another
invoice, Invoice No. “00114” [Exhibit P16 ]. With regard to the allegation
that Exhibits P1 and P16 were overlapping claims, it can be clearly seen
that these were separate and specific invoices at different points in time.
Works were carried out under both Invoices P1 and P5 long before P16
was issued. The lapse of time between P1 and P16 was almost 7 months
while that between P5 and P16 was about 1½ months. I agree with
plaintiff’s counsel (‘P/C’) that a comparison between P16 and the other
earlier invoices would show that it defies logic to claim that the scope of
works stated in P16 overlapped with that in the earlier invoices. There was
no similarity from the perspective of price and nature of works. More
importantly, when P16 was issued and received by D, no objection was
raised as to its correctness and validity. In any event, the onus was on D to
prove the allegation of double-claim but D had failed to adduce any
evidence to discharge this onus. Merely making an allegation and without
strictly proving it fell short of satisfying the onus of proof borne by D.
Similarly, merely by adding the word ‘Temporary’ to Exhibit P5 and the P.O.
[Exhibit P4] when the word was not found in the document did not amount
to the required proof.
[10]
The other 5 invoices disputed by D concern ‘Bridges 1767 and
1768’ and the reasons for the dispute are:
1)
There was no purchase order for these bridges. Instead the
S/C price was dependent on Invoices No. ‘00049’ and
4
‘00102’ which came to a total sum of RM360,000.00 and any
further invoice constitutes double claim;
2)
Scope of works for both the bridges did not differ much but
for ‘1767’ the claim is only RM51,000.00 whereas for ‘1768’
it is RM421,530.00
As regards reason (1) above, nowhere in P’s case was it contended that
there was a P.O. for these bridges. It was common ground that the S/C
price depended on invoices only as compared to ‘1766’ for which it
depended on a P.O. and a quotation, apart from invoices. For the former,
D never, in the course of dealings with P, objected to any payment based
on invoices. Neither did it insist on any P.O. before payment could be
made. As pointed out by P/C, D seemed to be inconsistent in its defence.
[11]
Coming to reason (2) above, DW1 testified that there was a huge
difference in price for bridges ‘1767’ and ‘1768’ although the layout plan
and drawings reveal only minor differences. While D/C stressed this point,
P/C drew attention to the testimony of DW1 on the same aspect under
cross-examination where he affirmed that for ‘1767’ P only supplied girder
(beams) to support the temporary steel bridge No. ‘1767’ whereas for
‘1768’ P fabricated and installed 2 sets of temporary bridges which D
purchased from the Malayan Railways (‘KTM’). Therefore, the allegation of
the huge monetary difference being unjustified was plainly misconceived.
Invoices Not Disputed
[12]
In reply to the defence allegation of ‘double/overlapping’ claim,
P/C laid emphasis on the fact that all the invoices were contemporary
documents which were never challenged or objected to by D ever since the
date of receipt until the sub-contract works were completed by P. This fact
was borne out by the evidence. The question arose whether D could raise
the challenge at this point when it had not done so at the time of receipt
and when a demand for payment had been made? Either way, doubts
arose as to the credibility of the challenge. My attention was drawn to the
Court of Appeal case of Boonsom Boonyanit v. Adorna Properties Sdn.
Bhd. [1997] 3 CLJ concerning the principle relating to judicial appreciation
5
of evidence where the credibility of oral evidence had to be tested against
contemporaneous documents. In that case, Gopal Sri Ram, JCA (as he
then was) said at p. 317:
“Judicial appreciation is concerned with the process of evaluating
the evidence for the purpose of discovering where the truth lies in
a particular case. It includes, but is not limited to, identifying the
nature and quality of the evidence, assigning such weight to it as
the trier of facts deems appropriate, testing the credibility of oral
evidence against contemporaneous documents as well as the
probabilities of the case and assessing the demeanour of
witnesses.”.
[13]
In applying the principle as elucidated above, having regard to the
contemporaneous documents in the form of invoices duly issued and
acknowledged without any objection being raised thereafter, I found the
defence contention of ‘double claim’ to be obviously unsustainable. The
same applied to the contention that the items of claim under Invoice 114 [
P16 ] should be inclusive of those works claimed under 053 and 100 [ P1 &
P5] as nowhere in these invoices is it said so. It amounted to no more than
an attempt to vary or contradict the contents of a written document when no
objection had been made at the earliest possible opportunity or even within
a reasonable time frame.
[14]
On the defence attempt to controvert or vary written documents in
the form of the P.O. and the invoices, which D admitted as constituting the
S/C price, my attention was drawn to sections 91 and 92, Evidence Act,
1950 which prohibit such variation or contradiction. Reference was made
to a case in point, Tractors (M) Bhd. v Kumpulan Pembinaan (M) Sdn. Bhd.
[1979] 1 MLJ 129 (FC) where it was held:
“(1) on a proper and correct construction of the agreement
between the parties, it was beyond argument that the intention
between them was that the property in the vehicle was not to pass
to the respondent until full payment had been made. It was
therefore a hire-purchase agreement and until full payment had
been made the appellant had the right to repossess the vehicle on
6
breach of its terms by the respondent.
therefore not wrongful;
The repossession was
(2) the case was therefore on the undisputed facts and as a
matter of the proper construction of the agreement and the
application of the proper law, an eminently fit one for proceedings
in lieu of demurrer under Order 25 Rules of the Supreme Court.”.
The Issue of Estoppel
[15]
This issue was raised by P in the Reply to Defence on the ground
that D did not object to any of the invoices that the latter had admittedly
received and paid for partially. It was, thus, pleaded that D was estopped
from making the allegations in para 3 of the Defence by reason of these
facts: that D had neither objected to or questioned the prices stated in the
invoices nor made any allegation of any additional works done without
request; that D had made payment towards the S/C price without any
protest or question; and that the amounts stated in the invoices are with the
prior agreement. Every invoice contains the indorsement “Claims to be
made within 7 days after receipt of goods”. On the lack of protest by D to
the invoices, P/C made reference to the Court of Appeal case of Boustead
Trading [ 1985] Sdn. Bhd. v. Arab-Malaysian Merchant Bank Bhd. [1995] 4
CLJ where the relevant part of the judgment reads:
“A reasonable man similarly circumstanced as the respondent
would have been entitled to assume, as the respondent did, that
the appellant was agreeable to the imposition of the 14 days limit.
The respondent was clearly influenced by the conduct of the
appellant when it paid Chemitrade for those invoices, and this the
respondent would not have done had the appellant protested. The
appellant’s attempt to raise this point some seven months later,
must be classified as unconscionable and inequitable conduct. It
ought not therefore to be permitted to question the validity of the
indorsement.”.
[16]
As D in the instant case did not at any time question the validity of
the indorsement on the invoices, D/C submitted that it indicated that the
indorsement is part of the original agreement and was valid and binding.
7
He also stressed the fact that D had already paid a substantial sum in part
settlement of the S/C price without making any objection to the invoices
submitted to it.
[17]
Going by the decision of the Court of Appeal in the Boustead case
above, D’s dispute over certain invoices on the grounds as per para 3 of
the Defence should be classified as unconscionable and inequitable
conduct in the sense referred to by the Court of Appeal. The doctrine of
estoppel would apply to estop D from now contesting the validity and
correctness of the invoices in question when it was not done at the
appropriate time leading P to believe that the invoices were not being
disputed. D/C’s submission that the plea of estoppel should be rejected in
this case on the ground that as late as April 2008 P could not arrive at the
final price was, in my view, misconceived. This was because estoppel was
raised in respect of specific invoices that had never been disputed by D
and not in respect of calculation of the final sum due and owing.
Discrepancies in calculation was no ground for non-application of estoppel
in respect of specific acts or statements. D did not deny the non-existence
of any notices or written documents to show that it disputed any of the
invoices.
Non-appropriation of Payment To Any Specific Invoices
[18]
An aspect of the defence case was that D “never paid on any
specific invoices” as submitted by D/C or in other words, that D did not
appropriate payment to any specific invoices. It followed them that D could
not be stopped from disputing the invoices from the fact of payment. The
law applicable to this situation is s. 62 of the Contracts Act, 1950 which
states:
“62. Application of payment where neither party appropriates
Where neither party makes any appropriation, the payment
shall be applied in discharge of the debts in order of time,… ”
My attention was also drawn to the case of Nam Joo Hong Feedmills Sdn.
Bhd. v. Soon Hup Poultry Farm [1985] 2 MLJ 206 where the court adopted
8
para 509, Vol. 9, Halsbury’s Laws of England on the right of appropriation
which reads:
“507.
Account current. Prima Facie, the right of appropriation
by the creditor does not arise in the case of an account current,
that is to say, where there is one entire account into which all
receipts and payment are carried in order of date, so that all sums
paid in form one blended fund. In such a case the presumption is
that the first item on the debit side of the account is intended to be
discharged or reduced by the first item on the credit side, and that
the various items are appropriated in the order in which the
receipts and payments are set against each other in the account.”.
[19]
P in the instant case maintained only one account in which all
receipts and payments are recorded in order of date. Hence, by adopting
the aforesaid principle of accounting, it was submitted by Plaintiff that the
sum of RM774,000.00 admittedly paid by D was in satisfaction of the
invoices in order of time as set out in the Second Schedule to the SOC. I
agree that P should now be estopped from questioning the invoices even
though D had made payments in respect of the invoices in chronological
order. This view was fortified by the fact the throughout the receipt of the
series of invoices followed by payments no question arose as to the validity
of the invoices even as late as when P issued the Notice of Demand to
which no reply followed. In the recent Court of Appeal case of Yoong Sze
Fatt v. Pengkalan Securities Sdn Bhd [2010] 1 MLJ 85, Low Hop Bing,
HMR held:
“In our judgment, if the defendant had really nothing to do with the
account or the trading of the shares by his employer through the
account… the defendant as a reasonable man would no doubt
have at the earliest opportunity raised a complaint, protest or
querry with the plaintiff in relation to the contract notes, contra
statements and letter of demand sent to his home address. He
had not done so. It is now too late in the day to deny liability after
the commencement of the suit, a fortiori, in this appeal. The
defendant’s conduct certainly calls for the application of the
doctrine of estoppel.”.
9
Alleged Tampering of Invoices
[20]
Of the 7 disputed invoices, 5 were disputed on a further ground of
tampering. For each of the aforesaid 5 invoices produced by P and marked
as Exhibits P6A, P7A, P11A, P12A and P13A, which were all photocopies,
D tendered a corresponding photocopy. The latter photocopies were
marked Exhibits P6B, P7B, P11B, P12B and P13B. It was alleged that a
significant difference between these 2 sets of invoices was proof of
tampering. No further evidence was led to prove tampering as alleged.
The difference that was purportedly proof was that P’s copies contained a
rubber-stamp endorsement that read “Please Chop, Sign and Return this
copy” whereas the copies exhibited by D didn’t. P’s copies also bore 2
other rubber-stamps, that of D and one Saga Forte Resources (M) Sdn.
Bhd. (‘SF’). Quite obviously, P’s copies were different from those of D
because the former were used for acknowledgment purposes. P also
called a witness from SF to explain the presence of SF’s rubber-stamp on
the invoices addressed to D, which D/C alleged was an afterthought upon
evidence of tampering having been led. The essential question was
whether there was in fact any evidence of tampering?
[21]
As the allegation of tampering was made by D, the evidential
burden of proof of that particular fact was on D [S. 103, Evidence Act
1950]. It is a serious allegation of a criminal nature akin to fraud.
Therefore, a high degree of proof is required to establish tampering by P,
on whom there was no onus to disprove the fact unless sufficient evidence
was adduced by D to discharge its evidential burden.
[22]
A fraudulent act is one done “with intent to defraud, but not
otherwise” [s. 25, Penal Code]. The defence contention on tampering
appears to imply that it was with the intention of defrauding D even though
the vital contents of both sets of invoices are the same. It is trite law that
where fraud is alleged in civil proceedings it must be proved beyond a
reasonable doubt [Saminathan v. Pappa [1981] 1 MLJ 121, at p. 126;
Boonsom Boonyanit v. Adorna Properties Sdn. Bhd.(C/A) [1997] 3 CLJ 17].
The evidence led by D on the present allegation, relying purely on a
comparison of documents, without more, in my finding, fell far short of proof
beyond doubt. There was a logical and reasonable explanation for the
difference in the 2 sets of photocopies of the same documents and should
10
be accepted in the absence of proof to the contrary. It is noteworthy that
the documents produced by P were all agreed documents within the
knowledge of D and at no previous instance had any allegation of
tampering been raised as to their contents.
[23]
A more crucial fact in regard to the present issue is that the
allegation of tampering was never pleaded. It is settled law that only issues
and facts that are specifically pleaded need to be considered by the court in
adjudging a claim. The success or failure of a party’s case depends
entirely on its pleadings and the evidence led in support thereof. It is not
proper for a court to give judgment in a suit on material facts or issues not
pleaded even though the evidence presented at a trial may give rise to a
whole variety of facts and issues outside the ambit of pleadings. [ Bank
Bumiputra (M) Bhd. v. Mahmud b. Hj. Mohamed Din, Datin Hajjah Salmah
bt Md Jamin, Intervener [1990] 1 MLJ 381; Yen Wan Leong v. Lai Koh
Chye [1990] 2 MLJ 152]. Order 18, Rule 8, Rules of the High court, 1980
states:
“A party must in any pleading subsequent to a statement of claim
plead specifically any matter, for example, performance, release,
any relevant statute of limitation, fraud or any fact showing
illegality –
…
(b) which, if not specifically pleaded, might take the opposite
party by surprise;”
D/C conceded that the issue of ‘tampering’ was never pleaded but argued
that the law is clear on this point whereby evidence need not be pleaded
and that the issue was being raised based on an evidential point only.
Further, that as it was incumbent on P to prove its case and as doubt had
arisen as to the validity of the invoices, the onus was on P to account for
the tampering. Suffice to say that this line of argument was completely
erroneous and contrary to established rules of pleadings. There is no basis
whatsoever in law for raising an issue that was never pleaded purportedly
from an evidential point. Tampering is a mere allegation and not evidence
that need not be pleaded. The invoices were part of the bundles of
11
documents that had been duly exchanged between the parties and the set
of invoices (copies) produced by D were in its possession. Hence, to argue
that the issue of tampering only surfaced at the trial was clearly untenable
on the available facts.
[24]
For the above reasons, I held that D’s contention that P’s invoices
should be rejected as evidence on the ground of tampering was clearly
without basis and untenable in law.
Decision
[25]
In view of the foregoing, I found that P had, on a balance of
probabilities, made out its claim, that the agreed sub-contract price should
be calculated based on the quotation and purchase order in respect of
‘Bridge 1766’ while for ‘Bridges 1767 and 1768’ the price should be based
purely on invoices issued and received by D without objection. By adopting
this manner of calculation, the price for ‘Bridge 1766’comes to
RM685,000.00 and not RM710,060.00 as pleaded as the parties’ stand
was that the T & C of the S/C for this bridge were to be inferred from the
quotation and P.O. Effect had to be given to the agreement which evinced
the true intention of the parties. As such the claim had to be limited to the
agreed price as deduced from these documents despite the invoices which
gave a figure of RM710,060.00. However, in respect of the other 2 bridges,
the agreed S/C price was dependant wholly on the invoices, none of which
had been proved to be double-claims or tampered with as alleged. The
price of RM472,530.00 as pleaded and determined from the invoices could
be deemed as agreed on the evidence and thus, was binding and
enforceable against D. This finding would answer the issues arising as
regards scope of works, value of the sub-contract and the extent of D’s
liability to P.
[26]
On the issue of estoppel, I would summarise that until this case
was filed, D had not challenged or objected to any of the invoices issued by
P and had made a series of payments into the running account of P
maintained for the S/C. Hence, on the basis of all the evidence and
records, D was now estopped from questioning the invoices to deny their
12
liability. For D to be allowed to do so would be unconscionable and
inequitable under the existing circumstances.
[27]
As for tampering, it was a non-issue as it was neither pleaded nor
listed as an agreed issue to be tried. In any event, the onus of proving the
allegation rested with D but D had clearly failed to discharge the onus of
proof as, inter-alia, no evidence in support had been led.
[28]
In conclusion, I found that while P had made out a case as
pleaded, D had failed to prove the allegations against the truth and veracity
of the invoices on which this claim was premised. I, thus, entered judgment
for P for the sum adverted to above with costs and interest.
Counter-claim
[29]
D has claimed against P under no less than seven heads which D
was said to be entitled to under the sub-contract (‘S/C’). The basic
question was whether D was entitled make these claims in this suit which
was filed sometime in year 2009 when P had completed their works under
the sub-contract way back in September 2007. Thereafter, no demands or
claims had been made by D in respect of the works done by P. At no
instance before the commencement of this action did D notify P that it
intended to make any of the claims as per the counter-claim. When P’s
solicitors issued the notice of demand dated 18.07.2008 for the sum now
claimed, there was neither reply nor counter-demand from D. The only
instance when D disputed the sub-contract sum was when P had
completed the S/C works and made demands for payment for the balance
towards the end of 2007. At a meeting arranged by KTM to resolve the
dispute, D contested the sum claimed solely on the ground that the total
S/C sum should be computed on the basis of the quantity of steel that had
been used in the works. DW1, D’s sole witness, admitted this fact under
cross-examination. At that point in time, no issue had been raised as to D’s
entitlement to offset that sum against the instant claims for LAD, negligence
and others, which appear to be an afterthought after P had commenced
this suit for the balance payable by D.
13
Liquidated Assessed Damages (‘LAD’)
[30]
D/C submitted that based on DW1’s testimony and the documents
exhibited D had proved that LAD had been imposed for late completion of
the project and thus, D was entitled to claim the sum from P. As rightly
submitted by P/C, the issue was not late completion and imposition of LAD
but whether under the terms of the S/C, P could be held liable to pay
compensation for the delay.
[31]
The S/C between P and D was for a specific type of works in the
project that involved a variety of works and various stages for which several
contractors had been engaged. No deadline had been imposed on P to
complete the works under the T & C of the S/C. On this ground alone, the
claim for LAD against P could be held unsustainable. Neither had any
agreement been reached that in the event of delay LAD could be imposed
on P. In other words, time did not seem to be at the essence. In any
event, after D had completed the work, there was neither any allegation or
complaint by D of delay nor claim for LAD.
[32]
It is noteworthy that P had been engaged to carry out the main
work involved in the project-fabrication and installation of ‘Bridge 1766 vide
PO dated 22.01.2007 [ Exhibit P4 ] – as late as some 9 months from the
date of commencement of the project with only 3 months left for the
scheduled completion. From D’s correspondence itself to KTM for
extension of time to complete the project, D itself had delayed beginning
the work on schedule. In applying for extension of time [ Exhibit D21 ], the
reasons advanced attributed delay to a number of factors, such as wide
spread flooding in Malacca, none of which concerned D.
[33]
PW1’s evidence that the S/C works had been completed in May
2007 and not in September was challenged by the defence on the ground
of being in conflict with P’s own pleading that completion took place in May
2007. I agree that a party in not entitled to lead evidence in conflict with its
own pleaded case. Be that as it may, the late completion, if any, did not
make any difference as there was no agreed time-frame for P to complete
the work. Neither had there been any objection been raised by D for late
completion nor a notice issued within a reasonable time to claim for
14
damages or compensation for the delay citing specifically the consequential
losses that D had sustained.
[34]
The project was finally completed on 05.02.2008, well after P had
installed ‘Bridge 1766’ whether it was May or September 2007. The
evidence showed that various other works to be carried out by other subcontractors after the installation had not been completed on schedule and
thereby could have caused the delay. There was no clear evidence to
prove that the delay which occasioned LAD being imposed on D was
actually caused by D. Hence, the claim for P to be held liable for LAD was
not proved.
Derailment and Damage To Signal Cable
[35]
D relied on a report of derailment at ‘Bridge 1767’ [Exhibit D22] on
14.12.2006 in support of this claim. The Defence alleges that the signal
cable was damaged at ‘Bridges 1767 and 1768’ while derailment occurred
at ‘Bridge 1768’ on 10.03.2007. DW1 confirmed that it occurred at ‘1768’
contrary to the report D22. These clear contradictions themselves cast
doubt on the veracity of this claim. In any event, the vital question was
whether P had caused the above derailment and damage in the course of
carrying out its work. P/C drew the court’s attention to D22 which was a
contemporaneous document which clearly revealed the cause of the above
derailment and damage to signal cable. The report concludes that the
track contractor did not comply with specifications and structure at the
bends of the tracks. Laying the tracks was no part of P’s work under the
sub-contract as P was not the track sub-contractor. There was, therefore,
no doubt that P could not be held liable for the current loss/damage and D’s
evidence itself showed it was outside P’s scope of work.
Negligence For Causing Cave In of Soil
[36]
DW1 confirmed that the cave in was to the track platform that
involved the ballast that supported the track. When the cave in occurred,
DW1 hired a tamping machine to strengthen the ballast. DW1 also
confirmed that if there was any sinking of ground, the tracks or piling
contractor would be responsible and that ballast work was the track
15
contractor’s responsibility. Neither ballast nor tracks was within P’s scope
of sub-contract works. Hence, it was again clear that P could not be held
liable for the above incident as there was no proof of P having caused it.
Platforms and Cranes
[37]
D exhibited certain documents allegedly showing costs incurred for
hiring cranes for P to install the bridge. DW1 admitted that D used cranes
to load and unload sleepers at the site in the course of the next stage of
work following installation of ‘Bridge 1766’, which includes ballast, sleepers
and tracks. These are not within P’s scope of works. The relevant work
order [Exhibit D19] tendered by D showed that the crane had been hired in
July 2007 which was long after P had installed ‘Bridge 1766’. P did not
issue any further invoices for work done after May 2007.
[38]
Exhibit D24 was the relevant Statement of Account tendered to
support this claim addressed to D. It referred to invoices for the months of
October 2007 and January 2008, by which time P had long completed
installing ‘Bridge 1766’. A further invoice referred to was Exhibit D25 which
was for hiring of excavator during July 2007. DW1 gave evidence that the
excavator was used in relation to ballast and to construct embankment.
Ballast work was not included under P’s sub-contract and therefore, P
could not be held liable for costs incurred in respect thereof.
[39]
Similarly, as regards platform, apart from stating that it had been
provided, it was not shown under which clause or term of the S/C, P was
liable to compensate D for providing the platform. Hence, D had failed to
prove this claim too.
The Remaining Items
[40]
There was a total failure to prove the losses as set out and these
items, therefore, needed no further consideration.
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Conclusion
[41]
In deciding the counter-claim, regard must be had to the legal and
evidential burdens of proof placed on the defendant (‘D’), who was in the
same position as that of P in the main suit. The onus was on D to adduce
sufficient evidence to prove all the items claimed, failing which P had no
case to answer on these claims. In this situation, the evidential burden
would not shift to P to rebut D’s evidence which in itself was lacking. As
held in Cottage Home Sdn. Bhd. v. Wong Kau & Anor [2011] 1 LNS 411.
“It is a fundamental principle in law that the party who asserts the existence
of facts upon which a judgment should be given to him must prove the
existence of these facts in accordance with section 101 of the Evidence
Act, 1950’.
[42]
In view of the state of D’s evidence on the counter-claim, based on
the foregoing grounds I found that D has failed to discharge the burden of
proof to prove the particulars of any of the items claimed. Furthermore, the
principles of estoppel would apply to estop D from asserting the claims at
this belated stage when no prior notice had been given to do so until the
commencement of this suit. The claims relate to matters or incidents
occurring long after P had completed its contractual obligations under the
sub-contract which appeared all along to be to the satisfaction of D. The
doctrine of estoppel is of wide application as a defence open, inter-alia, to
parties in a contractual relationship. In the case of Boustead Trading
(supra) Gopal Sri Ram, JCA (sitting in the Federal Court) observed:
“The time has come for this court to recognize that the doctrine of
estoppel is a flexible principle by which justice is done according to
the circumstances of the case. It is a doctrine of wide utility and
has been resorted to in varying fact patterns to achieve justice.
Indeed, the circumstances in which the doctrine may operate are
endless.”.
On the facts and evidence in this case, I found that the doctrine of estoppel
could be invoked by P as a defence to the counter-claim.
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[43]
For the above reasons, I found the entire counter-claim to be
without merit or basis and dismissed it with costs.
Dated: 30th June 2011
( GUNALAN A/L MUNIANDY )
Judicial Commissioner
High Court of Malaya
Johor Bahru.
…………… for the Plaintiff
Mr. Bala Gopal
Messrs Bala Gopal & Associates
Advocates & Solicitors
Malacca.
..…………. for the Defendant
Mr. Mohd Iqbal
Messrs Idris & Partner
Advocates & Solicitors
Shah Alam, Selangor.
18