The legal burden of proof in civil cases lies with the claimant, and assignments of receivables must be duly considered to determine payment obligations.

Introduction

[1] This is an appeal against the decision of the learned trial judge delivered on 15 May 2017, which allowed the plaintiff's claim against the defendant for the amount of RM3,586,000.00 as the sum due and owing to the plaintiff for payment invoices in respect of contracts for the supply, delivery and provision of Engineering Services by the plaintiff to the defendant.

[2] For ease of reference, parties will be referred to as they were in proceedings before the High Court.

Background Facts

[3] Initially, the plaintiff had commenced a suit against two defendants, viz the 1st defendant, Telekom Malaysia Bhd and the 2nd defendant, Standard Chartered Bank Bhd. Following a discovery application, the plaintiff amended its Statement of Claim, and withdrew the action against the 2nd defendant. The plaintiff proceeded its claim against the 1st defendant, Telekom Malaysia Bhd only (hereinafter referred to as the defendant).

[4] The following facts are not disputed. By a letter of award dated 2 February 2007, the defendant had awarded the plaintiff a contract for the supply, delivery and provision of engineering services for battery system for the defendant (Contract No K1530949/07). The value of the said contract was for RM18,000.00. A formal written contract was executed on 19 July 2007. Vide a Supplementary Agreement to Contract No: K1530949/07, the contract value was increased to RM25,808,984.83.

[5] The defendant had also awarded the plaintiff Contract No K1260066/07 for a contract value of RM6,000.00. A formal written contract was also entered into between the plaintiff and the defendant.

[6] For the purpose of financing the Contracts, the plaintiff had obtained financial assistance by way of factoring from Affin Bank Bhd as well as Standard Chartered Bank Bhd Affin Bank Bhd financed Contract No: K1530949/07, while Standard Chartered Bank financed Contract No: K1260066/07.

[7] Vide a Factoring Agreement and Deed of Assignment both dated 13 December 2006 between the plaintiff and Affin Bank Bhd, the plaintiff had assigned all of its rights from the proceeds of Contract K1530949/07 to Affin Bank Bhd. The defendant was informed of such assignment and that all payment of invoices in respect of the Contract be made to the plaintiff's Affin Bank Account No 100680162501 ('the designated account') at No 10 Jalan Todak 1, Pusat Bandar Seberang Jaya, 13700 Prai, Pulau Pinang.

[8] To finance the works under the Contract K1260066/07, the 1st defendant had obtained financial assistance of RM4,200,000.00 from Standard Chartered Bank. By a letter dated 21 December 2007, the plaintiff also gave notice to the defendant that the plaintiff had assigned all of its rights from the proceeds of the Contract K1260066/07 to Standard Chartered Bank and all payment of invoices under Contract K1260066/07 was to be made to the plaintiff's Standard Chartered Bank account No 312100915114 at Level 15, Menara Standard Chartered, 30 Jalan Sultan Ismail, 50250 Kuala Lumpur.

[9] The plaintiff had performed the works under the two contracts for the supply, delivery and provision of engineering services for battery system for the defendant. Invoices for payment were issued in respect of both Contracts.

[10] In 2010, the plaintiff was informed by Affin Bank that there was a shortfall of payment received by Affin Bank in respect to contract K1530949/07. The shortfall was in the amount of RM3,586,000.00.

[11] On 27 November 2011, the plaintiff and the defendant entered into a Settlement Agreement in respect of Contract No K1530949/07.

[12] In 2011, the plaintiff was wound up by Lembaga Hasil Dalam Negeri (LHDN) for default in th