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2011 MarsdenLR 5047
HASNAH MOHAMMED HASHIM
FDM ASIA PACIFIC PTE LTD – Appellant
Versus
CHAN FOONG CHOO & ANOR – Respondent
Fraud in civil cases must be proved beyond reasonable doubt, placing the burden of proof on the alleging party, which was not satisfied in this case.
Headnote:(A) Law of Contract - Sale of Goods - The case revolves around a claim for goods sold and delivered amounting to RM422,635.18. The Defendants contended the invoices were false and alleged fraud in dealings. (Paras 1-2)
(B) Onus of Proof - The principle established is that the burden of proving fraud lies with the party alleging it, requiring proof beyond reasonable doubt, not merely on the balance of probabilities. (Paras 35-36)
Facts of the case:
The Plaintiff supplied goods to the Defendants, who disputed receipt and authenticity of invoices, alleging goods were delivered to a third party for fraudulent purposes. (Paras 1-2)
Findings of Court:
The Court determined that goods were ordered, supplied, and received by the Defendants, dismissing allegations of fraud due to lack of evidence. (Paras 47-50)
Issues: Whether the goods were ordered, supplied, and received by the Defendants, and whether fraud was involved in the transactions. (Paras 29-30)
Ratio Decidendi: The Court concluded that the Plaintiff satisfied the burden of proof for the claim, while the Defendant failed to substantiate claims of fraud, emphasizing the necessity of clear evidence to prove fraudulent actions. (Paras 47-50)
Result: Judgment entered for the Plaintiff in the sum of RM422,635.18 with interest and costs.
The Plaintiff is a company incorporated in Singapore. The Defendants are partners running a business known as Advantech Tools Supplies in Petaling Jaya, Selangor. The Plaintiffs claim is for goods sold and delivered in the sum of RM422,635.18 as listed in the Statement of Claim and exhibited on page 58-76 the Common Bundle of Documents (CBD). Upon the request of the Defendants the Plaintiff supplied precision cutting tools to the Defendants upon the terms and conditions agreed upon. The Defendants denied the claim as the invoices issued were false invoices. Judgment in default has been entered against the 2nd Defendant. This proceeding was between the Plaintiff and the 1st Defendant.
The Plaintiffs case
The Plaintiffs director, Mr. Tok Chee Chuan (PW1) told the Court that he had initially dealt with the 2nd Defendants husband, Wong Siew Weng and Mr. Raymond Low who is the husband of the 1st Defendant. Mr. Raymond Low had initially started the business as a sole proprietorship. When he resigned the 1st Defendant joined in June 2005 and subsequently the 2nd Defendant joined in 2006.
According to PW1 the Defendants ordered the goods as shown in the Purchase Orders at pages 1-57 CBD. The Purchase Order was sent to him by e-mail. There were times that Mr. Raymond Low or Mr. Wong Siew Weng would either call or sms the orders without the Purchase Orders. The goods were then delivered in batches through the courier service using Proforma invoice. Once the delivery was completed the Plaintiff then issued out the invoice (as per page 56-76 CBD) for payments. According to the Plaintiff the Defendant has made payments to some of the invoices issued as shown on pages 83-99 CBD.
PW2, Mr. Wong Siew Weng who is the husband of the 2nd Defendant was also involved as a wholesaler of cutting tools in Malaysia. He gave evidence that he was involved in the Defendants business in 2004. The business was initially registered under the 1st Defendants husband and was subsequently replaced by the 1st Defendant in June 2005. The 2nd Defendant became a partner in 2006. PW2 explained in evidence that his wife handled all the accounts whereas the 1st Defendant was a signatory to the Defendants business accounts. PW2 confirmed that the goods were ordered either by e-mail or sms. According to PW2 the goods as described in the invoices at pages 58 to 76 CBD were duly delivered and received by the Defendants. He further gave evidence in his Witness Statement that he and Mr. Raymond Low had personally collected the goods from the courier service company:
"Mr. Raymond Low and my personally collected these goods from the courier service company. After collection, we either directly to our customers or we bring back the goods to the office and do a stock check. We personally collect the goods from the courier service company because of the time both of us are not in the office.".
The Defendants case
The 1st Defendants defence is that the goods as described in the invoices were not received by the 1st Defendant. She claimed that there was fraud, false invoices and accounts statements. Goods were sold to 3rd party and the proceeds of sales were not credited into the Defendants business. It is the contention of the 1st Defendant that the goods were in actual fact delivered by the Plaintiff but delivered to another company owned by PW2, Maju Precision.
In the Statement of Defence it is stated that:
"Defendan Pertama menyatakan bahawa perkongsian Defendan iaitu Advantech Tools Supplies pernah berurusan dengan Plaintif di mana bayaran-bayaran penuh telah pun diselesaikan. Secara alternatifnya Defendan Pertama menyatakan bahawa barangan saperti yang dinyatakan di perenggan 6 Pernyataan Tuntutana telah di hantar dan/atau didokumentasikan seolah-olah dihantar serah kepada Advantech Tools Supplies atas pesanan Defendan Kedua dan/ atau suaminya tanpa pengetahuan Defendan Pertama. Barangan yang dihantar sebenarnya mengunakan nama perkongsian Advante
