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2022 MarsdenLR 1785

HIGH COURT MALAYA ALOR SETAR
RI-YAZ HOTELS AND RESORTS SDN BHD – Appellant
Versus
DYNAMICS CAPITAL SDN BHD – Respondent
[Suit No: KA-22NCVC-69-06/2018]



Petitioner Advocates:Julian Ch ng ,Respondent Advocate: Mohd Zali Shaar

The Court has the discretion to strike out a Defence for non-compliance with pre-trial case management directions, reinforcing the importance of adhering to procedural timelines.

Headnote:(A) Rules of Court 2012 – Order 34 r 2(3) – Strike out of Defence – Plaintiff's application to strike out the Defendant's Defence and/or Counterclaim due to non-compliance with pre-trial case management directions for witness statements – Court determined that failure warrants striking out and entering judgment. (Paras 20, 22, 32)

(B) Arbitration Clause – Disputes arising from the agreement must first be referred to arbitration – Defendant's failure to reserve right to arbitration at earlier stages bar claim now. (Paras 16, 29)

(C) Non-compliance with Court Directions – Court emphasized responsibilities of parties in meeting procedural timelines. (Paras 24, 30)

Facts of the case: Defendant failed to file witness statements as directed by the Court, prompting Plaintiff's application to strike out Defence and seek judgment for non-compliance. (Paras 30, 32)

Findings of Court: Defendant’s repeated failures to comply with Court’s pre-trial directions justified striking out the Defence and entering judgment for the Plaintiff. (Paras 31, 32)

Issues: Whether the Defendant’s failure to comply warrants striking out the Defence and entry of judgment; whether Defendant has reasonable grounds to oppose. (Paras 20)

Ratio Decidendi: Court has discretionary power under O 34 r 2(3) to strike out Defence for breach of pre-trial directions, emphasizing the importance of procedural adherence for justice. (Paras 22, 28)

Result: Plaintiff’s application allowed with costs of RM4,000.00.

JUDGMENT

Arik Sanusi Yeop Johari JC:

Introduction

[1] On 8 April 2022, the Plaintiff filed an application in encl 63 to seek for the following orders:

(a) to strike out the Defendant's Defence and/or Counterclaim dated 13 August 2018 pursuant to O 34 r 2(3) of Rules of 2012 (hereinafter referred to as " ROC 2012") and/or inherent jurisdiction of this Court for failing to comply with the Court's pre-trial case management directions to file the witness statements; and

(b) that judgment be entered against the Defendant for the Plaintiff's claims

[2] After considering encl 63 and all the cause papers, and hearing the submissions by both parties, this Court has allowed the Plaintiff's application in encl 63 with costs of RM4,000.00 subject to allocator, for the reasons stated below.

Factual Background

The Main Suit

[3] The Defendant is the owner of a four (4) star hotel in Sungai Petani, Kedah known as "Pure by Ri-Yaz" (hereinafter referred to as "the Hotel") and the Plaintiff is the operator of the Hotel.

[4] Both parties have entered into the Technical Services Agreement (hereinafter referred to as "TSA") and the Hotel Management Agreement (hereinafter referred to as "HMA") on 25 February 2013 whereby the Defendant appointed the Plaintiff to, amongst others, consult, assist, review and propose the design, construction, operation and management of the Hotel.

[5] The Plaintiff filed this action against the Defendant for default in payment and breaches of the TSA and the HMA which amount to RM773,394.34 as at 18 April 2018.

[6] After several adjournments, during the pre-trial case management on 1 November 2021, the Court has fixed the hearing date of the main suit on 8 February 2022 and 9 February 2022 and parties are directed to file their list of witnesses and witness statements by or before 22 January 2022.

[7] Despite such directions and the setting down of the trial date, the Defendant's former solicitors, Messrs Ahmad Rusydi Md Nor (hereinafter referred to as "the Defendant's former solicitors") filed an application to discharge themselves from acting as solicitors for the Defendant pursuant to O 64 r 5 of ROC 2012 ("Enclosure 38") as they did not get any instruction and cooperation from the Defendant.

[8] After hearing both counsels on 31 January 2022, this Court has granted the the Defendant's former solicitors' application in encl 38 and directed that the hearing date on 8 February 2022 be vacated whilst the hearing date on 9 February 2022 be maintained.

[9] On 9 February 2022, the Plaintiff is ready to proceed with the trial with two witnesses and all the relevant documents have been filed, including the witness statements. However, before the trial commences, the Defendant's new solicitors, Messrs Bahar Rusnan & Associates (hereinafter referred to as "the Defendant's new solicitors") informed the Court that they were just appointed by the Defendant on 6 February 2022 and the Defendant's witness statements have yet to be filed. Thus, they requested the trial to be adjourned to other dates and agreed to pay the costs of the day of RM3,000.00 to the Plaintiff. The trial date was then postponed to 25 April 2022, 13 June 2022 and 14 June 2022 and the Defendant was directed to file the list of witnesses and the witness statements by or before 2 March 2022.

[10] Despite such directions, the Defendant still failed to file and serve the witness statements to the Plaintiff on the prescribed date.

[11] The Defendant then applied for an extension of time to file the witness statements vide a letter dated 8 March 2022 (Enclosure 60). However, it was not granted by this Court as there is no reasonable ground and justification to support the application.

[12] As a result, on 8 April 2022, the Plaintiff filed the Notice of Application in encl 63 together with the Certificate of Urgency (encl 65) to strike out the Defendant's Defence and/or Counterclaim and to enter judgment against the Defendant pursuant to O 34 r 2(3) of ROC 2012, on the following


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