This is the first defendant's application (encl 9) under O 18 r 19 of the Rules of the High Court 1980 ('the RHC'), the inherent jurisdiction of the court and O 92 of the RHC, to strike out the action on grounds that: (i) the plaintiff had not disclosed a reasonable cause of action against the first defendant; (ii) the action is frivolous, vexatious and an abuse of the process of court; (iii) the court has no jurisdiction because it is functus officio to hear the instant action; and (iv) the issues in this action are res judicata.

The background facts, fairly straightforward, may be restated as follows. By an agreement dated 20 May 1977 ('the sale agreement'), one Tan Ah Chim @ Tan Ah Chin ('TAC') as the registered proprietor of land known as Holding 70 TS 5 NED Penang ('the said land') 'sold', whilst Ooi Bee Tat @ Ooi Bee Lee ('OBT' — the plaintiff herein) 'purchased' a portion of the said land measuring approximately 143,969sf, upon the terms and conditions set out in the sale agreement.

However, that sale, in truth, was a joint venture between TAC as landowner and OBT as developer, as the true sale consideration — see cll 2 and 11 of the sale agreement — apart from a perfunctory cash deposit of RM10,000, was OBT's construction and completion, at OBT's costs, of three type 'A' houses (each costing RM120,000), 11 type 'B' houses (each costing RM330,000) and four type 'C' houses (each costing RM160,000) on the remaining 'unsold' portion of the said land. Perhaps further comment on the 'sale consideration' should be reserved for another day and on another occasion.

About a year later, by an agreement dated 27 August 1978 ('the 27 August 1978 agreement'), TAC sold and Tan Ah Chin & Sons Sdn Bhd ('TAC & Sons' — the second defendant herein) purchased the whole of the said land, subject however to the 'rights, title and interest of OBT under the sale agreement', upon the terms and conditions set out in the 27 August 1978 agreement. The 27 August 1978 agreement provided that the sale consideration of RM790,000 shall be satisfied by the payment of RM40,000 and the allotment of 750,000 ordinary shares of RM1 each in the capital of TAC & Sons to TAC — see cll 2 and 3 of the 27 August 1978 agreement.

A year later, by an assignment dated 14 June 1979 ('the assignment') and with the preamble stating it 'is supplemental to the sale agreement', OBT assigned all his 'rights, title and interest' in the sale agreement to Ooi Bee Tat & Sons Sdn Bhd ('OBT & Sons' — the first defendant herein) for the consideration and upon the terms and conditions set out in the assignment.

It would appear, therefore, that by the middle of 1979, both parties to the sale agreement, be it with or without the consent of the other, had respectively sold and assigned their respective rights, title and interest in the sale agreement and had entrusted the performance and completion of the sale agreement to their respective successor-in-title or assignee. Anyway, in 1981, TAC & Sons filed an action (Penang High Court Suit No 449–81) against OBT for (alleged) breach of the sale agreement; OBT counterclaimed against TAC & Sons for specific performance of the sale agreement, whilst OBT & Sons, who intervened as the second defendant, counterclaimed against TAC & Sons for specific performance of the same sale agreement. So, quite apparently, OBT (plaintiff herein) and OBT & Sons, since both were after the same prize, had by then gone their separate ways.

The pleadings in Suit No 449–81, eminently relevant to the instant application, particularly on the issues of functus officio and res judicata, should be, and so it is, set out in detail as follows.

In its statement of claim, TAC & Sons averred that OBT who commenced construction of the buildings on the unsold portion of the said land on 22 August 1977 had: (i) failed to complete the said buildings within the stipulated period; (ii) used inferior building materials; and (iii) ceased, sometime in 1979, all build