- 上诉庭发现，原告在诉讼前发了一封律师信给被告；但被告没有采取任何行动来回复。 …failure to respond on the facts of the case should lead to entering of judgment. Small Medium Enterprise Development Bank Malaysia v. Lim Woon Katt  9 CLJ
- 法庭指出，被告身为一名商人，如果他认为律师信中的内容不属实，打算对此提出异议，他就必须回复；而并非选着视而不见...in commercial cases (not civil), Courts have taken notice that, in the ordinary course of business, if one man of business states in a letter to another that he has agreed to do certain things, the person who receives that letter must answer it if he means to dispute the fact that he did so agree. PECD Construction Sdn Bhd v. Freehold Point Sdn Bhd  3 CLJ 215.
- The Plaintiff was appointed as the main contractor by Jelai Holdings Sdn Bhd (“the Employer”) for a proposed project to construct and complete a Nine Story Office Building on Lot 11237 together with a car Park (“the said Project”). The contract was dated 19.12.2008.
- The 1st Defendant was a shareholder and director of the Employer. The 2nd Defendant was a consultant involved in the said Project.
- The Plaintiff plead it had granted to the 1st Defendant loans. With regards to the 2nd Defendant, the amount claimed is set out in [pg 28 of Rekod Rayuan Jilid 1]. The pleaded case of the Plaintiff was for the repayment of the aforesaid loans. The said contract was terminated on 17.03.2016 and the Plaintiff’s claim for repayment of these loan sums.
- The joint defence of the 1st and 2nd Defendant and the counterclaim of the 2nd Defendant are that the 1st Defendant was to obtain financing to finance the said Project. The amount to be sought for in financing should exceed the contract price and any excess should be paid to the 1st defendant and these monies should be paid as the Plaintiff progress claims are being paid (the oral Agreements).
- The Defendant contend based on this oral Agreement, the 1st Defendant applied for a bridging loan from Amanah Raya Capital Sdn Bhd for a sum of RM34,201,798.56. The Project in the meanwhile was in progress and thereafter the 1st Defendant varied its bridging loan requirements to RM40,350,000.00 (the said loan). The 1st Defendant also denies some of the payments that the Plaintiff claims were made and maintains the oral Agreement between the parties would be the answer to the Plaintiff’s claim.
- In a Judgment that could be best described as brief and precise, the learned Judge there appears to be an evaluation of all witnesses from the Plaintiff and the Defendants and a consideration of all the relevant documents tendered in Court. The learned Judge found as a matter of fact that the Plaintiff had proved that the loan sums being claimed against the Defendants had been proved. It would also follow in our view, that the learned Judge had rejected the contention of the 1st Defendant that there was an oral Agreement between the parties. The learned Judge had rejected the version of the Defendants by accepting as a fact that the Plaintiff had proven its case.
- We refer to the decision of the Federal Court in Lee Soh Hua v Kow Lup Piow & Ors  2 MLJ 101 where it was held:
“That the learned judge in this case was faced with two different stories and he accepted the story of the respondents as true. The appellate court was not justified in reversing the decision of the trial judge and the appeal should therefore be dismissed”.
“The learned Judge made clear that he accepted the evidence of the respondents that had they known about these three conditions they would not have offered $700,000 because they would have to expend a large sum of money to comply with the three conditions. The learned Judge was faced with two different stories — the appellant’s version and the respondents’ version. He had to decide which was the truthful one. Very much depends upon the credibility of the witnesses in view of the conflicting evidence. We did not have the same opportunity as the learned Judge in seeing and hearing the witnesses and assessing their credibility. He accepted the story of the respondents as true. He has approached the matter cautiously and we cannot say he has not directed himself correctly. This is not a sort of case that an appellate court is justified in reversing the decision of the trial Judge by substituting its own view of the facts for that of the trial Judge. We do not think we should interfere with his finding. We would therefore dismiss the appeal with costs. Deposit to the respondents on account of taxed costs”
- We had during the course of submissions by the Plaintiff, had our attention drawn to the Letter of Demand sent by the Plaintiff in this case. There was no response from the Defendants. In our view that would have presented the Defendants the best opportunity to present the version of the Defendants but it was not done. We refer to the Court of Appeal decision of Small Medium Enterprise Development Bank Malaysia v. Lim Woon Katt  9 CLJ at pg. 73 where his Lordship Hamid Sultan JCA held:
“(a) In the instant case, it was not in dispute that the respondent did not respond to the demand notice of the plaintiff and the defence alleging that he was not liable was only raised in the statement of defence. Evidently, failing to respond to the plaintiff’s letter of demand, that too when the defence case was related to forgery, as well as the fact that the respondent did not lodge a police report upon receiving the demand, weakened the probative force of the defence case. In David Wong Hon Leong v. Noorazman Adnan  4 CLJ 155, the Court of Appeal went to the extreme end to say that failure to respond on the facts of the case should lead to entering of judgment. Justice Gopal Sri Ram JCA at page 159 had this to say: “On December 17, 1991, the respondent wrote to the appellant confirming an agreement between them whereby the former was to receive an additional fee of RM100,000 if he assisted in resolving the problem regarding the access. It is the respondent’s case that he did in fact obtain the required access through his exertions. The appellant, however, denies any agreement to pay the additional fee. In respect of this sum, the learned Judge granted leave to defend. We would digress for a moment to say a few words about this latter order of the learned judge. During argument, we registered our surprise at the learned Judge’s reluctance to enter judgment for this sum of RM100, 000. After all, the appellant had failed to respond to the letter of 17 December. If there had never been an agreement as alleged, it is reasonable to expect a prompt and vigorous denial. But, as we have pointed out, there was no response whatsoever from the appellant.”
(b) In abundance of caution we must say that failure to respond must not be equated to admission of the claim under Section 17 of Evidence Act 1950 (EA 1950). Failure to respond will relate to conduct under Section 8 of EA 1950. Conduct is a relevant fact for the court to take into account to give the relevant probative force to the version of the plaintiff and/or defendant’s case. It is well settled that not all demand notices must be responded. In Wiedmann v Walpole  2 QB 534, in an action for breach of promise of marriage, it was held, that the mere fact that the defendant did not answer letters written to him by the plaintiff in which she stated that he had promised to marry her, was no evidence corroborating the plaintiff’s testimony in support of such promise.
(c) It must also be noted that in commercial cases (not civil), Courts have taken notice that, in the ordinary course of business, if one man of business states in a letter to another that he has agreed to do certain things, the person who receives that letter must answer it if he means to dispute the fact that he did so agree. [See PECD Construction Sdn Bhd v. Freehold Point Sdn Bhd  3 CLJ 215].
(d) There is a latin maxim which says ‘silence amount to consent’. [See Quit tracet consentire videtur]. However, this is not part of our law of evidence. Failure to respond goes to conduct and is a relevant fact and not an admission as stated in illustration (g) of Section 8 of EA 1950, which reads as follows:
“The question is whether A owes B RM10, 000. The facts that A asked C to lend him money, and that D said to C in A’s presence and hearing: “I advise you not to trust A for he owes B RM10, 000,” and that A went away without making any answer are relevant facts.”
(e) In the instant case, the learned trial judge failed to take into account that the appellant’s demand notice in a commercial matter was not responded to. Further there was no reason or justification for not responding to it. The omission of the learned trial judge to do so in our view compromised the decision making process”.
- Looking at the Grounds of Judgment as a whole, whilst the same might be labelled as being rather stark we do not find it to be “nonspeaking”. We find no appealable errors save and except for the rate of interest imposed and we agree with the learned Judge’s finding to dismiss the counterclaim.
- On the upshot, we partly allowed the appeal in the Court in respect of interest which should run at 5% per annum from the date of Judgment.
Source: Mohd Zin bin Omar & Anor v Jentayu Padu Sdn Bhd  MLJU 407. Court of Appeal Putrajaya. Hamid Sultan bin Abu Backer, Prasad Sandosham Abraham and Asmabi binti Mohamad JJCA.
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