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2024 MarsdenLR 2077
HIGH COURT MALAYA KUALA LUMPUR
AMBANK (M) BHD – Appellant
Versus
HERMIE MOHD TAHIR – Respondent
[Civil Appeal No: WA-12BM-1-06/2022]
The absence of a certificate of indebtedness is fatal to a debt recovery claim, even if the debtor admits to the debt, necessitating a retrial to address critical issues.
Headnote:(A) Civil Procedure - Locus Standi - Certificate of Indebtedness - The court partially allowed the appellant's appeal for retrial as the learned trial judge dismissed the case on grounds of non-submission of the certificate of indebtedness, despite the respondent admitting to the debt. (Paras 1, 10, 24)
(B) Evidence - Burden of Proof - The appellant's failure to provide documentary evidence to substantiate the claim of debt led to the dismissal of the case. The court emphasized the necessity of a certificate of indebtedness to establish liability. (Paras 15, 23)
(C) Fair Trial - The court noted the importance of considering all relevant documents before making a ruling, highlighting a fundamental error by the trial judge in proceeding without critical documents. (Paras 21, 22)
Facts of the case:
The appellant claimed a debt from the respondent, who acknowledged the debt but contended it was owed to his employer, TM. The trial judge dismissed the claim due to lack of documentary evidence.
Findings of Court:
The court found the trial judge erred by not considering relevant documents and the issue of locus standi before dismissing the appellant's claim.
Issues: The main questions addressed were whether the appellant had the standing to sue and the necessity of the certificate of indebtedness for proving the debt.
Ratio Decidendi: The court ruled that the absence of a certificate of indebtedness was fatal to the appellant's claim, despite the respondent's admission of debt.
Result: Appeal partially allowed; retrial ordered before a different sessions court judge.
JUDGMENT
Introduction
[1] This court had partially allowed the appellant's appeal and ordered a retrial of the civil action brought by the appellant against the respondent and that the retrial is to be heard by a different sessions court judge.
[2] The respondent is aggrieved by that decision.
Background
[3] The appellant's/plaintiff's case before the learned sessions court judge was a straight forward one — whether the respondent/defendant owed the appellant the sum claimed. The respondent did not deny he owed a certain sum but he argued he owed the sum to his employer Telekom Malaysia Bhd ('TM') and not the appellant. He questioned the locus standi of the appellant bringing the case against him as his contract was concluded with TM and never the appellant. The appellant brought this appeal before this court as the learned trial judge dismissed the appellant's case solely on the ground that the appellant failed to exhibit the certificate of indebtedness.
[4] The respondent was an employee at TM. As an employee, the respondent is eligible for housing financing facility with terms as set under the TM Staff Housing Facility/Scheme ('TM Staff Housing Scheme'). The TM Staff Housing Scheme is devised according to Shariah Principle of Bai' Bithaman Ajil.
[5] For purposes of the TM Staff Housing Scheme, TM signed the 'servicer agreement' dated 27 May 2009 with AmMortgage, Ambank and Pacific Trustees. Under that agreement, TM appointed AmBank as its agent to perform functions with respect to the TM Staff Housing Scheme, and AmBank Mortgage appointed AmBank as the lawful agent of purchasers. The respondent falls under the definition of purchaser.
[6] Vide a sale and purchase agreement dated 12 May 2014 between the respondent and Amerin Residence Sdn Bhd, the respondent purchased an apartment at B-16-7, Tower B, Amerin Mall, Kajang ('the apartment'). The brief details of the purchase are as follows:
Price of Apartment: RM481,000.00
Fire Insurance: RM3,735.00
Mortgage Reducing: RM14,836.00
Term Assurance (MRTA)
Total: RM499,571.00
[7] For purposes of the said purchase, the respondent applied for the TM Staff Housing Scheme. TM issued a letter of offer to the respondent dated 3 July 2014 where TM agreed to fully financed the total purchase price of the apartment amounting to RM499,571.00, with an agreed purchase price pursuant to the Shariah Principle of Bai' Bithaman Ajil at RM1,010,664.00.
[8] The respondent and TM then entered into the property purchase agreement dated 16 December 2014 where the respondent sold the apartment to TM and TM purchased the apartment with agreed purchase price of RM1,010,664.00. The monthly instalment is RM4,679.00, but after deducting the Muqassah (discount) which the respondent was entitled pursuant to the TM Staff Housing Scheme, the respondent's monthly instalment is RM3,249.00 for the period of 216 months (18 years). Beneficial ownership and rights over the apartment passed to TM by virtue of the said property purchase agreement.
[9] With that background, it was clear that there was no loan agreement signed by the respondent with any financial institution. The only 'loan agreement' signed by respondent was the property purchase agreement dated 16 December 2014.
The Decision Of The Sessions court Judge
[10] The learned sessions court judge ruled that the appellant's claim is for recovery of debt, which shall be proven by the appellant that the respondent failed to pay despite the demand to do so. The existence of the respondent's debt to the appellant shall be proven through a certificate of indebtedness. This is provided in para 11.03 of the property sale agreement dated 16 December 2014, and Section 13.14 of the deed of assignment of the same date.
[11] The appellant failed to show the certificate of indebtedness and the appellant's witnesses, SP1 and SP2 both testified on the amount of RM476,456.51 owed by the respondent to the appellant but did not substantiate their testimony with any document.
[12]
