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2022 MarsdenLR 1391
HIGH COURT MALAYA PULAU PINANG
ANANDA KUMAR KRISHNAN – Appellant
Versus
NG CHIN TAI & ANOR; TESCO STORES (MALAYSIA) SDN BHD (GARNISI) – Respondent
[Civil Suit No: PA-37G-24-12/2019]
The garnishor's second application for garnishment was barred by res judicata and failed to comply with procedural rules as no new judgment was obtained post-initial proceedings.
Headnote:(A) Civil Procedure Rules – Order 49 r 1 – Garnishment proceedings – The garnishor's second application for garnishment was struck out by the Senior Assistant Registrar based on the determination of debt in previous proceedings. The court found that the second garnishee application did not comply with the requisites of the rules and was barred by the doctrine of res judicata. (Paras 7, 10, 12)
(B) Consultancy Agreement – The validity and enforceability of the consultancy agreement were affirmed in earlier judgment proceedings, but the garnishor was not entitled to bring further claims based on it without a supporting judgment for the additional sums. (Paras 5, 9)
Facts of the case: The garnishor entered into a consultancy agreement with the judgment debtors where they agreed on a 5% fee based on invoices. After securing a judgment against the JD, the garnishor pursued additional claims based on perceived unpaid amounts.
Findings of Court: The court held that the garnishor was not entitled to proceed with the second garnishee application as no new judgment had been obtained post the initial order.
Issues: The key issues revolved around the applicability of res judicata and whether the garnishor could initiate a second application based on a prior declaratory order.
Ratio Decidendi: The court ruled that the garnishor's claim was barred due to previous determinations on the same debt and that the requirements of Order 49 r 1 were not satisfied.
Result: Appeal dismissed with costs.
JUDGMENT
[1] The judgment creditor ("garnishor") appealed against the decision of the learned Senior Assistant Registrar ("SAR") allowing Tesco Stores Malaysia Sdn Bhd ("garnishee") application to strike out the garnishor's second application for garnishment. Having heard the appeal, I dismissed the same.
[2] The garnishor entered into a consultancy agreement with the judgment debtors ("JD") on 6 Februari 2005 where the latter agreed to pay the former 5% of the total invoice value of any and/or all billings made by garnishee to the JD arising from a contract between the JD and the garnishee for supply of fishes commencing from February 2005. The JD consistently paid the 5% fee until December 2005 when the JD informed the garnishee that the garnishor had ceased to act on behalf of the JD.
[3] The garnishor thereafter initiated a suit No 22-413-2010 ("Suit 413") against the JD to recover the consultancy fee and on 11 September 2015 obtained a judgment against the JD for a sum of RM26,650,396.00 (RM19,266,746.16 as the principal sum and RM7,383,650.55 as interest). The JD lost their appeals in the Court of Appeal and the Federal Court. The garnishor thereafter on 13 Oktober 2015 took out a garnishee proceedings and obtained an order that the garnishee to pay the garnishor a sum of RM3,179,014.47 where the said payment was duly made. This was for the period from September to October 2015.
[4] Before the learned Senior Assistant Registrar ("SAR"), the garnishor on 17 Disember 2019 vide encl 1 filed this garnishee application for the second time to recover another RM2,098,314.20 and obtained an order nisi. This second garnishee application was premised upon the belief that the garnishee is still indebted to the JD a sum of RM35,992,631.00 as the garnishee still made purchases from the JD from 2006 onwards and that there were further unauthorised deductions on rebates and cost recovery made by the garnishee for the period prior to September 2015 ie from September 2006 which were not disclosed in the first garnishee proceedings. The garnishor obtained this information from the winding up petition proceedings against the 2nd defendant to recover the balance of the amount that the JD owed him. As against this application the garnishee applied to strike it out vide encl 11 and the learned SAR allowed the same.
Submissions
[5] The learned counsel for the garnishor in support of this appeal argued that res judicata or estoppel has no application as the garnishee still owes the JD and this was only made known after the first garnishee proceedings. It was argued further that the High Court in Suit 413 held that the consultancy agreement was valid and enforceable. Therefore, he submitted that the garnishor could initiate this garnishee application based on the said judgment to recover the remaining unpaid commission. It was further submitted that the proceedings must be allowed to go for the show cause stage and only at that stage can the garnishee show that it is not indebted to the JD. The learned counsel further argued that execution is not a final judgment.
[6] The learned counsel for the garnishee argued that the second garnishee proceedings was caught by the doctrine of res judicata as the issue of debt had been conclusively determined in the first garnishee proceedings. Both the garnishee proceedings were based on the same judgment which had been dealt with. It was pointed out that there was no such thing as the second principal judgment sum and the garnishor should not be allowed to relitigate the issues of indebtedness between the garnishor and the JD. It was further argued that the second garnishee application was not founded on any judgment instead it was premised upon paragraph (b) of the Order dated 11 September 2015 ("Order") which was declaratory in nature in respect of the consultancy agreement.
Decision
[7] It is not disputed that the garnishee premised the second garnishee proceedings upon the High Court judgment d
