Syed Othman J:

The appellant was a director and secretary of the respondent society (the society). The allegations against him were that he knowing that the vendor, one Manickam, had purchased 59 acres of land in Penang for $456,000 failed to disclose to the society the transaction; that as a result, the society purchased the land in February 1965 for $944,000; and that he after the purchase of the land without the knowledge and consent of the society received for himself from Manickam a commission totalling $122,000 made up of two payments: $82,000 on 13 May 1965 and $40,000 on 29 June 1965. The society claimed loss or damage i.e. $488,000 excess payment for the purchase of the land and $122,000 the secret commission.

The appellant in his defence denied knowledge that the land had been purchased for only $456,000 or that he had received for himself a commission of $122,000.

The learned trial judge, after a trial lasting eight days, gave judgment on the claim for secret commission but dismissed the claim for compensation of $488,000.

The appellant appeals against the judgment on the secret commission and the society cross-appeals against the dismissal of the claim for compensation.

I think it is necessary to set out in some detail the two versions of the story in order to follow my grounds in the appeal and the cross-appeal.

The case of the society at the trial may be put briefly as follows. In 1964 a co-owner of the land gave one Rengasamy an option for sale of the land at $8,000 per acre. The total area of the land was 62 acres 0 rood 25 poles. In

May 1964 one Periasamy, since deceased, who was known to Rengasamy came to see him in Penang. He telephoned Manickam in Kuala Lumpur. Rengasamy also spoke to Manickam on the telephone and told Manickam that he had an option for $8,000 per acre but would not sell the land for less than $10,000. Periasamy returned to Kuala Lumpur on the same night. Manickam telephoned Rengasamy and told him that he would buy the land and that a Chinese would see the land and if he was satisfied another person would buy the land. A few days later the Chinese came to Penang with Periasamy and inspected the land for about one hour. That night Manickam spoke to Rengasamy on the telephone and told him that he and the appellant would come to Penang from Kuala Lumpur to inspect the land. He informed Rengasamy that the appellant was from the Prime Minister's Department and an important person. Four or five days later Manickam and the appellant came to Penang. Rengasamy met them at the airport. From there they went to the land which was on the way to the town and inspected the land for about half an hour. There was some discussion about the price of the land. Rengasamy asked for $10,000 per acre. Manickam offered $9,000. The appellant then put it at $9,500 per acre. This became the agreed purchase price. Rengasamy wanted an advance of $10,000. On the appellant's instruction, Manickam issued a cheque for $2,000.

After the visit, Periasamy, the nominee of Manickam, on 29 June 1964 entered into an agreement with the co-owners of the land for the purchase of the land at the agreed price of $472,000 (pages 403-4 appeal record).

On 6 November 1964 the owners of the land conveyed the land to Manickam for $456,000. Out of the agreed price $16,000 was deducted in respect of 31/ 2 acres which were used as a grave yard. On the same day, Manickam wrote a letter to the Chairman, Board of Directors of the society offering the land at $16,000 per acre (see p. 412 appeal record). On 12 November 1964 (p. 413) the appellant wrote to the State Planning Officer, Penang stating that the society "has negotiated" for the purchase of the land and enquired whether the land was suitable for development of housing for government officers. The heading of the letter gives the area of the land as 62.0258 acres. On 27 November 1964 the board of directors held a meeting. One of the matters discussed was this offer. Accordin