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2023 MarsdenLR 1036
HIGH COURT MALAYA SHAH ALAM
SAMA ASSAVAAKUL – Appellant
Versus
CHOO KAH HOE & ANOR – Respondent
[Civil Suit No: BA-22NCvC-397-09/2022]
Filing a second suit after the first was struck out for non-compliance with a peremptory order constitutes an abuse of process, reinforcing the necessity of adhering to court orders.
Headnote:(A) Rules of Court 2012 - Order 18 r 19 and Order 92 r 4 - Plaintiff's claim struck out for failure to comply with a peremptory order regarding security for costs, constituting abuse of process due to filing a subsequent suit with identical claims and facts. (Paras 22, 26, 27, 32, 60)
(B) Abuse of Process - The court emphasized that the filing of a second suit after a first suit was struck out for non-compliance with a peremptory order amounts to an abuse of process. (Paras 32, 35, 37)
Facts of the case:
The Plaintiff initiated a lawsuit on behalf of himself and 418 other individuals, claiming losses due to alleged fraudulent conduct by the Defendants in forex trading. The Defendants had previously obtained an order for security for costs, which the Plaintiff failed to comply with, resulting in the automatic striking out of the First Suit. (Paras 3, 12, 18, 22)
Findings of Court:
The Plaintiff's current suit was struck out as it was deemed an abuse of process, being a duplicate of the First Suit that had been struck out for non-compliance with a court order. (Paras 26, 60)
Issues: Whether the current suit constituted an abuse of the court's process due to its duplication of the claims in the previously struck-out suit. (Paras 27, 32)
Ratio Decidendi: The court held that the Plaintiff's failure to comply with the peremptory order and subsequent filing of a new suit with the same issues amounted to an abuse of process, reinforcing the need for compliance with court orders. (Paras 32, 37)
Result: Plaintiff's claim struck out without liberty to file afresh, with costs awarded to the Defendants.
| Table of Content |
|---|
| 1. overview of the plaintiff's claims and background. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11 , 12) |
| 2. details of the plaintiff's first suit and its implications. (Para 13 , 14 , 15 , 16 , 17 , 19 , 20 , 21 , 23) |
| 3. court's analysis of the abuse of process. (Para 24 , 26 , 27 , 28 , 29 , 30 , 31) |
| 4. legal precedents on abuse of process and compliance. (Para 32 , 33 , 34 , 35) |
| 5. consequences of non-compliance with court orders. (Para 36 , 37 , 38 , 39 , 43 , 57) |
Introduction
[1] The Defendants filed an application vide encl 12 seeking to strike out the Plaintiff's claim against the Defendants pursuant to O 18 r 19 (a) and/or (b) and/or (c) and/or (d) and/or O 92 r 4 of the Rules of Court 2012 ( ROC 2012) . The Defendants' claimed that the Plaintiff failed to demonstrate the reasonable cause of action against the Defendants and are also scandalous, frivolous, vexatious, and an abuse of the Court's process.
Brief Facts
[2] The Plaintiff's claim against the Defendants, in summary, is as stated below.
[3] The Plaintiff initiated the lawsuit on behalf of himself and 418 other individuals, referred to as the "Other Investors" listed in Appendix A of the Statement of Claim.
[4] On 15 May 2019, the 2nd Defendant signed a Memorandum of Agreement with a company called Throne Legacy Capital (TLC) for a period of five (5) years. The agreement is for cooperation between the 2nd Defendant and TLC to provide a forex platform service known as "IBHFX." The 2nd Defendant authorised TLC to manage the forex division, use its investment banking license, and use its corporate branding materials. TLC was a newly incorporated company at the time of the agreement.
[5] The Defendants and TLC invited the Plaintiff and Other Investors to visit the 2nd Defendant's business premises in Kuala Lumpur and Labuan. The 1st Defendant made representations to the Plaintiff and Other Investors regarding forex investment with the 2nd Defendant and TLC, emphasising the global nature of forex trading.
[6] The Defendants held a WikiForex expo in Vietnam, where the 2nd Defendant was the main sponsor, and the 1st Defendant spoke about the FX market and the collaboration between TLC and IBH as a wealth creation opportunity. The Defendants introduced various investment promotions, including the PAMM1 and PAMM2 promotions, a new investment package, year-end promotions, and a Chinese holiday promotion. Investors received confirmation emails from the 2nd Defendant upon opening an investment account with IBHFX.
[7] The Defendants represented that the investment was created by 49 experts worldwide and introduced the Forex Insurance Profit Security Plan (FIPS) as a transparent and risk-free trading plan.
[8] Due to the COVID-19 pandemic, the Defendants informed the investors about limited trading performance and introduced a new trading partner, AVA. The Defendants represented that AVA had a successful track record and introduced two new funds, GWF and APFF.
[9] The Defendants mentioned the need for legal adjustments and regulatory compliance to provide confidence to investors and regulators.
[10] The Plaintiff and Other Investors encountered difficulties in initiating withdrawal transactions from the IBHFX platform. The platform underwent a transition to a different platform, providing the Plaintiff and Other Investors with the choice to migrate to the Limestone platform. However, if the Plaintiff and Other Investors opt not to switch, the Defendants automatically and forcefully transfer their investment platform.
[11] Thus, the Plaintiff's alleged that:
a. the Defendants misrepresented facts and persuaded investors to invest with the 2nd Defendant and TLC.
b. the Defendants dishonestly prevented or refused investors from withdrawing their investments from their accounts.
c. the Defendants scammed investors and committed serious crimes that necessitate immediate investigation by authorities.
d. the Defendants were extensively engaged in forex trading using
