The court affirmed that an undertaking given during an injunction application suffices for subsequent assessment of damages, and procedural objections raised late are estopped.

JUDGMENT

Atan Mustaffa Yussof Ahmad J:

Introduction

[1] Before the court is an appeal by the Appellants against the decision of the learned Sessions court Judge ("SCJ") dated 12 August 2024, allowing the Respondents' application for assessment of damages under O 37 r 1 of the Rules of 2012 (" ROC ") in encl 38. The total damages awarded were RM196,260.81, including costs of RM2,000.00 The Appellants submit that the learned SCJ erred in law and fact in allowing the Respondents' application for assessment of damages.

Background Facts

[2] The Appellants, AWA New Parts Sdn Bhd and Yip Wai Kean, commenced a suit against the Respondents for, among other things, breaches of fiduciary duties alleging that the Respondents (including former directors and employees) had conspired to establish a competing business, diverted customers, and caused financial losses.

[3] On 23 June 2023, the Appellants applied for an interim ex-parte injunction under encl 5 to restrain the Respondents from entering or using the Appellants' business premises located at Lot 37079, Jalan 10/118B, Desa Tun Razak, 56000 Kuala Lumpur ("the premises") and from removing any equipment or inventory pending the resolution of the main action.

[4] In the Affidavit in Support of the injunction application, the Appellants gave an undertaking as to damages at para 28, stating: "Saya mengatakan bahawa Plaintif- Plaintif adalah sanggup mengakujanji terhadap gantirugi sekiranya diarahkan oleh Mahkamah Yang Mulia ini."

[5] On 5 July 2023, the court granted the Appellants' application for an interim ex-parte injunction. This injunction was in force until 26 October 2023, when following a change of solicitors by the Appellants, their new solicitors requested to withdraw the interim injunction order, which the court granted with liberty to refile afresh.

[6] Following the withdrawal of the injunction order, on 15 November 2023, the Respondents filed an application under O 37 r 1 ROC in encl 38 for directions for the assessment of damages against the Appellants.

[7] On 12 August 2024, the Sessions court awarded damages in favour of the Respondents as follows:

a) Rental for premises: RM96,645.01

b) Employee salaries: RM74,615.80

c) Compensation for the loss of use of a vehicle (VDK9): RM25,000

d) Costs of RM2,000.00

The Application

[8] The Appellants appealed against the learned SCJ's decision dated 12 August 2024 allowing the Respondents' application for assessment of damages. The Appellants contend that the learned SCJ erred both in law and fact by allowing the assessment of damages application without a judgment or final order against them, by bypassing the mandatory requirements under O 37 r 1 ROC , by failing to properly evaluate the evidence on causation and quantum, and by allowing damages that duplicate those claimed in the Respondents' counterclaim in the main action.

Respective Parties' Submissions

[9] The Appellants submit that the Respondents have no right to file Enclosure 38 without any prior judgment or order directing damages to be assessed; that the Respondents failed to comply with the mandatory requirements under O 37 r 1 ROC ; that there was insufficient evidence of causation and quantifiable loss; that the Respondents failed to mitigate their losses; and that the damages awarded duplicate those already claimed in the counterclaim, which should be conclusively disposed of only after a full trial on the merits.

[10] The Respondents contend that there is no requirement in law for a specific judgment or order directing an assessment of damages before they could file encl 38; that they did comply with O 37 r 1 ROC by filing their application within the prescribed time; that they provided sufficient evidence to prove their losses through contemporaneous documents; that they did take reasonable steps to mitigate their losses; and that there is no prejudice to the Appellants as the Respondents have given an undertaking not to seek the same damages during trial if they are awarded