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2021 MarsdenLR 2693
HIGH COURT MALAYA KUALA LUMPUR
PALANIANDY SADAYAN – Appellant
Versus
AAKASH GREEN ENERGY SDN BHD – Respondent
[Appeal No: WA-12ANCvC-154-07/2020]
A Default Judgment is regular if obtained in compliance with procedural rules, and must be set aside only if a valid defence on the merits is established.
Headnote:(A) Rules of Court 2012 – Order 18 r 3(4), Order 19 r 2(1), Order 42 r 7, Order 55 r 15 – Judgment in default – Appeal against dismissal to set aside Default Judgment – Court held that Default Judgment was regular and Appellant failed to show a defence on the merits – The SCJ’s dismissal was maintained. (Paras 8, 9, 10, 36, 47)
(B) Default Judgment regularity – To set aside a Default Judgment, the first inquiry is whether it is a regular or irregular judgment – A regular judgment stands unless a defence on the merits is demonstrated. (Paras 8, 36)
Facts of the case: The Appellant sought to set aside a Default Judgment about a loan of RM125,000 given to the Respondent and others, after a procedural dispute about the timeline for filing a defence against a counterclaim. (Paras 2, 7)
Findings of Court: The Appellant did not satisfactorily show any defence against the Respondent's counterclaim nor prove the Default Judgment was irregular. (Paras 9, 36)
Issues: The main issues were whether the Default Judgment was regular and if the Appellant demonstrated a defence on the merits. (Paras 8, 36)
Ratio Decidendi: The Default Judgment was found regular as the Appellant received all necessary documents, and no meritorious defence was presented. (Paras 8, 36)
Result: Appeal dismissed with costs of RM3,000 awarded to the Respondent.
JUDGEMENT
Introduction
[1] This is an appeal against an order of the learned Sessions Court Judge ("SCJ") dated 1 July 2020. The SCJ had dismissed the Appellant's application to set aside a judgment in default of defence obtained by the Respondent on 24 January 2020 ("Default Judgment"). After a full hearing on 15 December 2020, I dismissed the appeal. These are the grounds of my decision.
Background
[2] On 15 April 2019, the Appellant obtained a judgment in default of appearance ("Previous Judgment") against the Respondent and two other defendants (collectively the "Defendants") in Kuala Lumpur Sessions Court Civil Suit No WA-A52NCvC-202-03/2019. The Appellant's claim was for a sum of RM125,000, allegedly being a loan given by the Appellant to the Defendants. The Defendants' application to set aside the Previous Judgment was dismissed by the Sessions Court. On appeal, the High Court on 18 December 2019 set aside the Previous Judgment and gave leave to the Defendants to enter appearance and file their defence ("HC Order").
[3] The HC Order stipulated that:
(i) the Defendants be given leave to enter appearance in the Sessions Court suit within 14 days from the date of the HC Order pursuant to O 12 r 5 of the ROC;
(ii) the Defendants be given leave to file their defence, together with the Respondent's counterclaim, in the Sessions Court suit within 14 days from the date of the HC Order pursuant to O 18 r 2 of the ROC.
[4] In compliance with the HC Order, the Defendants filed their appearance and defence on 23 December 2019. The Respondent additionally filed a counterclaim against the Appellant. The Respondent's solicitor served the said appearance, defence and counterclaim, together with the draft HC Order, on the Appellant's solicitor on 26 December 2019.
[5] Under O 18 r 3(4) of the Rules of 2012 ("ROC"), the Appellant must file and serve his defence to the Respondent's counterclaim within 14 days of receipt. The deadline for doing so was on 9 January 2020 (ie 14 days from 26 December 2019), which the Appellant failed to meet.
[6] In compliance with r 56 of the Legal Profession (Practice and Etiquette) Rules 1978, the Respondent's solicitor on 15 January 2020 gave the requisite 7 days notice of intention to enter a judgment in default of defence to the Appellant's solicitor. The said 7 days period lapsed on 22 January 2020. Despite the said notice being given, the Appellant failed to file and serve his defence to the Respondent's counterclaim. The Respondent then entered the Default Judgment on 24 January 2020.
[7] The Appellant applied to set aside the Default Judgment and sought a stay of execution in his application dated 28 February 2020. The SCJ dismissed the said application with costs of RM1,500 on 1 July 2020. The Appellant then filed this appeal on 3 July 2020, appealing against the said decision of the SCJ.
Decision
[8] When considering an application to set aside a judgment in default, the first task is to ascertain whether it is a regular or irregular judgment. If it is an irregular judgment, then the default judgment ought to be set aside as of right. If it is regularly obtained, the Court has to determine whether a defence on the merits has been shown. (See the Court of Appeal case of Yap Ke Huat & Ors v. Pembangunan Warisan Mumi Sejahtera Sdn Bhd & Anor, [2008] 5 MLJ 112 at 183).
[9] In the present case, the SCJ held that the Default Judgment is regular. The SCJ also found that the Appellant had failed to show any defence on the merits. I agree and see no reason to interfere with the decision of the SCJ. My reasons are as follows.
Default Judgment Is Regular
[10] The Appellant avers that the Default Judgment is irregular. This is premised on the Appellant's contention that the time for filing his defence to the Respondent's counterclaim does not start to run until the sealed copy of the HC Order is served on the Appellant's solicitor, or compliance by the Respondent with O 55 r 15 of the ROC. I find this conte
