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2021 MarsdenLR 1254
HIGH COURT MALAYA KUALA LUMPUR
MRCB BUILDERS SDN BHD – Appellant
Versus
PEMBINAAN LEEPING & ORS; ZULBAHARI ABU BAKAR (THIRD PARTY) (ENCL 79) – Respondent
[Suit No: WA-22C-39-05/2020]
A claim for contribution does not require a legal relationship to exist between co-employees, as established in third-party proceedings under the Rules of Court 2012.
Headnote:(A) Rules of Court 2012 – Order 16, Rules 1 and 6 – Application to set aside Third Party Notice – The court dismissed the Third Party's application to set aside Third Party Notice and Statement of Claim – The application was deemed unmerited as D2 established a prima facie case for contribution against the Third Party which warrants trial – The claims were neither scandalous nor vexatious (Paras 2, 37, 79).
(B) Third Party Proceedings – A defendant can issue a Third Party Notice for contribution or indemnity with court's leave – The court held that D2's claim for contribution against the Third Party is a valid course of action if the Plaintiff's claim against D2 is upheld (Paras 1, 3, 43).
Facts of the case: The Plaintiff sued D1, D2, and D3 for fraudulent acts; D2 and D3 issued a Third Party Notice against the Third Party, a former CEO, claiming responsibility for financial decisions impacting the Plaintiff’s claims (Paras 4-20).
Findings of Court: The court found D2's claims against the Third Party were not evidently unsustainable and had sufficient merit to be examined during trial (Paras 78).
Issues: Whether D2 has a cause of action against the Third Party; whether the Third Party Notice is scandalous or submits to abuse of process (Paras 28, 38).
Ratio Decidendi: The court ruled that a claim for contribution does not necessitate a legal relationship between co-employees; the validity of D2's claims will be assessed at trial (Paras 60-62).
Result: Third Party's application dismissed.
JUDGMENT
Introduction
[1] This is the application by Zulbahari Abu Bakar ('Third Party') in encl 79 to set aside-
(a) the Order of this Court dated 6 August 2020 granting leave to Chan Kah Wai, the 2nd Defendant ('D2') and Chai Yee Hin, the 3rd Defendant ('D3') to issue a Third Party Notice against the Third Party;
(b) the Third Party Notice issued by D2 against the Third Party dated 18 August 2020 and filed on 19 August 2020 (encl 67); and
(c) the Statement of Claim ('SoC') filed by D2 against the Third Party dated 18 August 2020, pursuant to O 16, r 6 and/ or O 18, r 19(1)(a), (b), (c) and/ or (d) and/ or O 92, r 4 of the Rules of 2012 ('RoC 2012'). A similar application was made by the Third Party against D3 (encl 81) and it was heard together with encl 79 on 30 July 2021.
[2] After having considered the cause papers and written submissions filed by the parties and the oral submissions by learned counsels representing D2, D3 and the Third Party, I had dismissed the Third Party's application in encl 79 with costs of RM3,500.00 while the Third Party's application in encl 81 was allowed with the same amount of costs. Directions were then given for the filing of the Third Party's Defence and D2's Reply to Defence.
[3] Only the Third Party is aggrieved with the decision in dismissing encl 79. My full grounds for the decision are elaborated below.
Background
[4] On 15 November 2019, the Plaintiff filed the Writ of Summons and SoC (encls 1 and 2) against the 1st Defendant ('D1'), D2 and D3.
[5] The SoC was subsequently amended and filed on 5 December 2019 (encl 10) wherein the Plaintiff pleaded the following facts.
[6] The Plaintiff is a company incorporated under the Companies Act 2016 and has its registered address and business address at Level 30, Menara Allianz Sentral, No 203, Jalan Tun Sambathan, Kuala Lumpur Sentral, 50470 Kuala Lumpur. The Plaintiff is in the business of providing engineering and construction services and is involved in numerous construction related projects throughout Malaysia.
[7] D1 is a partnership formed under the Partnership Act 1961 and has its principal place of business at No 51 Lot 3651, Batu 27^, Jalan Faizal 81500, Pekan Nanas, Johor. D1 carries out business in, among others, construction and renovation works.
[8] D2 is a Malaysian citizen residing in Segambut, Kuala Lumpur. He was initially appointed by Malaysian Resources Corporation Berhad ('MRCB') on 18 December 2014, the parent company of the Plaintiff, as the Senior Project Manager of Job Grade 6. He was assigned to the Special Project (LRT, Package B - Mainline), Puchong, Selangor ('LRT Project') which was conducted by one of MRCB's subsidiary companies ie MRCB Engineering Sdn Bhd D2 began employment with MRCB Engineering Sdn Bhd on 5 January 2015.
[9] D3 is a Malaysian citizen having his last known residential address at Malim Nawar, Perak. He was appointed by MRCB as the Project Manager of Job Grade on 7 July 2015 and was also assigned to the LRT Project. He began employment with MRCB Engineering Sdn Bhd on 24 August 2015.
[10] Subsequently, vide MRCB's letter dated 31 March 2016, D2 was relocated from the LRT Project to the Proposed the Westin Desaru Resort at Desaru Johor Darul Takzim for Corniche Hotel Sdn Bhd ('Project').
[11] D3 was also transferred from the LRT Project to the Project by virtue of MRCB's letter dated 30 June 2016.
[12] The relocation of D2 and D3 was with effect from 1 April 2016 whereby they were appointed as the Project Director and Project Manager, respectively, for the Project.
[13] The Plaintiff's cause of action against the Defendants is for various alleged misrepresentations, fraudulent acts and breach of contractual duties by D2 and D3.
[14] The Plaintiff contends that at all material times, D2 and D3 purportedly assisted and corroborated with D1 to create fictitious claims which were then submitted by D1 to the Plaintiff. In particular, the Defendants are said to have committed the following overt acts:
(a)
