Raja Azlan Shah J:

[1] The question in this application is whether the statement of claim ought to be struck out under O 25 r 4 of the Rules of the Supreme Court as disclosing no reasonable cause of action.

[2] The plaintiffs were shareholders of a company incorporated under the style of Kiwi Dry Cleaners Ltd and registered in the Federation of Malaya, now States of Malaya, in 1959 under the Companies Ordinance, 1946. The defendants are accountants and secretaries as well as auditors practising under the style of Peat, Marwick, Mitchell & Co in Kuala Lumpur.

[3] Para 3 of the claim avers that the defendants were employed as accountants and secretaries of the plaintiffs' business, ie the business of the company in Kuala Lumpur, and subsequently as auditors. Para 4 avers that the terms of the said employment were expressly agreed to and were inter alia that the defendants as accountants and secretaries were to make weekly visits to the plaintiff's place of business, check the accounts, counter-sign cheques, and generally to see that the plaintiffs' business was properly and profitably carried out. Para 5 avers that the defendants as auditors expressly agreed to prepare and send to the plaintiffs quarterly balance sheets of the plaintiffs' business. Para 7 avers that the defendants during the time the plaintiffs were shareholders in the company were in breach of the said terms and of their duties as accountants and secretaries and as auditors; there are eight sub-paragraphs specifying the alleged breaches of terms of employment para 8 sets out the particulars of loss. Para 10 avers that as a result of the defendants' breach of their aforesaid duties and resultant loss the plaintiffs were forced to sell the company without the opportunity of claiming goodwill. Further and better particulars of the statement of claim were asked for and delivered. It was disclosed that the plaintiffs became shareholders on 15 December 1959. They sold their shares on 30 November 1961. No defence has been filed.

"Under the rule (ie O 25 r 4) it had to appear on the face of the plaintiffs pleading that the action could not succeed or was objectionable for some other reason. No evidence could be filed.... But, as the procedure was of a summary nature the party was not to be deprived of his right to have his case tried by a proper trial unless the matter was clear."

[5] After stating that the former rules are now incorporated in the revised Rules of the Supreme Court, O 18 r 19, he continues:

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"But this summary jurisdiction of the Court was never intended to be exercised by a minute and protracted examination of the documents and facts of the case in order to see whether the plaintiff really has a cause of action. To do that is to usurp the position of the trial judge."

[6] The defendants argued that the case fell within