The doctrine of res judicata applies, preventing re-litigation of issues previously decided, establishing binding findings of fact.

Introduction

[1] The parties in this appeal will be referred to by their designations in the High Court. The appellant will be referred to as the "plaintiff " while the respondent will be referred to as the "defendant".

[2] This appeal is against the trial judge's judgment dated 21 July 2014 ("the judgment") wherein the High Court allowed the defendant's counterclaim ("the counterclaim") and declared that: (i) the plaintiff was in breach of the hotel management agreement dated 27 March 2006 ("the HMA"); and (ii) the defendant is entitled to an indemnity pursuant to the HMA as well as the mutual separation and settlement agreement dated 30 June 2011 ("MSSA"). The defendant was also awarded the sum of RM1,024,565.75 as damages ("judgment sum").

[3] The plaintiff's claim against the defendant in the main suit was for the sum of RM2,400,000.00. The same was allowed on 14 September 2012 (prior to the trial of the counterclaim) by way of summary judgment ("encl 7") by Singham J (as he then was). The parties were furnished with Singham J's written grounds of judgment in allowing encl 7 ("grounds of judgment for encl 7").

[4] In this appeal, the trial judge had erred when she allowed the counterclaim and refused to be bound by the earlier judgment of Singham J. The trial judge ought to have applied the principle of estoppel/res judicata to the counterclaim as all the issues raised by the defendant in the counterclaim had been comprehensively addressed and determined by Singham J.

Background Facts

[5] The defendant is the owner of the Seri Pacific Hotel located in Kuala Lumpur ("the hotel"). By the HMA, the defendant appointed the plaintiff to manage the hotel for 10 years ("the services").

[6] Sometime in September 2007, during the pendency of the HMA, an employment dispute arose between the hotel and one of its employees, Mohd Ansar bin Abdul Rashid ("Ansar"). The said dispute festered until September 2008 when Ansar's services was terminated, resulting in Ansar making representations to the Jabatan Perhubungan Perusahaan ("the IR Department") that he had been dismissed without just cause or excuse.

[7] On 28 June 2011, the IR Department notified the plaintiff that Ansar's complaint has been referred to the Industrial Court for adjudication.

[8] Two days later, ie on 30 June 2011, the defendant and the plaintiff agreed to mutually terminate the HMA, compromised all differences and part ways amicably by entering into the MSSA.

[9] Pursuant to the MSSA, the defendant was required to pay RM4.8 million to the plaintiff ("the settlement sum"), half of which was to be paid upon execution thereof. The sum of RM2.4 million, being the first tranche, was duly paid.

[10] The balance of RM2.4 million was to be paid on 31 December 2011 ("the balance settlement sum"). On 4 July 2011, the defendant issued a post-dated CIMB Cheque No: 274823 dated 31 December 2011 ("the cheque") for the balance settlement sum.

[11] On 1 November 2011, Ansar filed his statement of case with the Industrial Court and the same was registered as Industrial Court Case No: 13/4-824/11 ("the IR case").

[12] By a letter dated 28 December 2011, the defendant countermanded the cheque alleged for breach of the HMA and negligence by the plaintiff (collectively referred to as "the breaches"). Specifically, the areas complained of included the following:

(a) the plaintiff was in breach of cl 3 April 1 of the HMA as it terminated Ansar's employment without cause or excuse, resulting in the commencement of the IR case;

(b) the plaintiff was in breach of cl 3 April 7 of the HMA by failing to obtain a prior authorisation of the defendant's Board of Directors before extending Ansar's employment contract; and

(c) the plaintiff was n