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2012 MarsdenLR 84
HIGH COURT MALAYA KUALA LUMPUR
SINARLIM SDN BHD – Appellant
Versus
MEDALLION BUILDERS SDN BHD – Respondent
[Civil Suit No: 22NCC-1285-2011]
Audit confirmations submitted by the defendant recognized the debt, constituting valid acknowledgments under the Limitation Act, thus preventing the claims from being time-barred.
Headnote:(A) Limitation Act 1953 (Act 254) - Sections 26 and 27 - Contracts Act 1950 (Act 136) - Claims for unpaid contractual sums arising from oral agreements related to construction works - Defendant's submissions of no case to answer rejected; oral contracts established, and plaintiff’s burden of proof satisfied. (Paras 1, 105)
(B) Acknowledgment of debt - Court affirmed that audit confirmations constituted valid acknowledgments, allowing the claims to avoid being time-barred; the defendant acknowledged owing the debts as of the specified dates. (Paras 52, 98)
(C) Burden of proof - The court clarified that the plaintiff must establish both the existence of the contracts and that amounts remain due.
Findings of Court:
The court found clear evidence of the defendant's indebtedness to the plaintiff for all three claims.
Issues: The main issues included whether the plaintiff proved the existence of contracts and whether claims were time-barred.
Ratio Decidendi: The court held that the defendant’s failure to lead evidence and the nature of the evidence presented by the plaintiff met the burden of proof.
Result: The plaintiff's claims were allowed; defendants' counterclaims dismissed with costs.
| Table of Content |
|---|
| 1. cases consolidated due to commonality. (Para 1 , 2) |
| 2. claims arise under separate contracts, common witnesses. (Para 3 , 4 , 5 , 6 , 7 , 9 , 10 , 11) |
| 3. plaintiff's audit confirmations sought acknowledgment of debts. (Para 12 , 16 , 20) |
| 4. claims arise under separate contracts. (Para 13) |
| 5. defendant's arguments on burden and limitation considered. (Para 17 , 19 , 22 , 23 , 25) |
| 6. court confirms existence of contracts and responsibilities. (Para 26 , 30 , 31 , 32 , 33 , 41) |
| 7. submissions of no case require strong basis. (Para 27 , 28) |
| 8. evidence reviewed supports debts owed to plaintiff. (Para 34 , 36 , 37 , 38 , 39 , 44) |
| 9. existence of contracts is established. (Para 35) |
| 10. documents support claims; no disputes raised. (Para 42 , 43 , 45) |
| 11. audit confirmations analyzed as valid acknowledgment of debts. (Para 52 , 53) |
[1] By consent, the parties agreed that these three cases be heard together since they involved common parties and similar issues of claims for monies said to be due from work done for the defendant.
[2] After the close of the plaintiff's case, the defendant informed the court that it was submitting that there was no case to answer or meet in any of the three claims. The defendant was then put on election that in the event the court was not with the defendant, the defendant was not allowed to adduce evidence. This was plainly and clearly made to the defendant; who accepted and confirmed its election. With that, the plaintiff was directed to make its submissions followed by the defendant's submissions of no case to meet in each of the three claims.
The Three Claims
[3]These three claims arise under three separate contracts. The plaintiff's witnesses were Madam Tan Sock Peng (PW1), the plaintiff's Accounts Executive; Mr Lim Choong Yik (PW2), one of the plaintiff's directors; and Mr Chew Pete Chew (PW3) a director of Ernst & Young, Ipoh office, who were the statutory auditors of the plaintiff. Save for the necessary modifications, the testimonies of all three witnesses were common to the three claims.
i. 22NCC-1285-2011
[4]In relation to 22NCC-1285-2011, PW2 informed the court that pursuant to oral contracts made between the parties, the defendant appointed the plaintiff as a subcontractor to carry out piling works in the construction of two schools, Sekolah Menengah Kebangsaan Sg Pinang, Tumpat and Sekolah Menengah Kebangsaan Mata Ayer, Machang, Kota Bahru, Kelantan for a total sum of RM989,011.73. According to PW2, the defendant paid the plaintiff "upon progressive claims being submitted to the defendant directly".
[5] When the works were completed, the plaintiff submitted its final claims of RM484,221.00 and RM504,790.73 respectively for both schools on 1 August 2002 (exh P2). The defendant made some payments and as at 27 December 2002, the defendant is said to have made total payments of RM450,000.00 leaving a balance of RM539,011.73 outstanding. Subsequently, the defendant made two further payments of RM28,015.69 and RM15,000.00. This is not disputed - see pp 42 and 43 of bundle of agreed documents marked "Bundle A". Thereafter, there were no other payments. At the time of the claim, the balance stood at RM413,696.26.
ii. 22NCC-1286-2011
[6] The second suit of 22NCC-1286-2011 is slightly different. Here, PW2 informed the court that the plaintiff was claiming a sum of RM618,485.13 together with interests and costs. This was the balance sum due under a project concerning the widening of the Klang River.
[7] Although the term "joint-venture" was used in relation to this project, PW2 informed the court that "both parties understood this to mean that they were involved in the same project with their respective duties". The plaintiff was only appointed by the defendant to hire out its construction machinery and supply diesel because the main contractor was another company called Waja Destinasi. The plaintiff claimed not to be involved in other aspects of the project. The parties had "no business in common" with
