JUDGMENT

This is my JUDGMENT in respect of the defendant's appeal (enclosure 15) against the plaintiff's claim against decision of Senior Assistant Registrar entering summary judgment in favour of the plaintiff.

Brief facts

1. The plaintiff's claim against the 1^st defendant is in respect of advertisement contract. The 1^st defendant has placed advertisement with the plaintiff and not paid the bills. The 2^nd to 4^th defendants are guarantors.

The defendant has a counter claim wherein they have alleged that there is collateral contract called "Taffu Media Contract" and allege that the plaintiff has breached the said contract and consequence claiming damages, a sum more than the plaintiff's claim and/or else seeking a set off against the plaintiff's claim. In essence, the learned counsel for the defendant alleges before me that though judgment has been entered against the defendant, the plaintiff's claim must be stayed pending the hearing of the counter claim. Further, the parties have informed me that an application for stay before SAR was dismissed. The defendant relies on the case of Ronald Quay Sdn Bhd v. Maheswary Sdn Bhd; [1986] CLJ (Rep) 659, [1986] 2 CLJ 275 ; [1987] 1 MLJ 322.

The plaintiff says:

(i) Firstly, the Taffu Media Contract is a separate contract and has nothing to do with the Contract in our suit as client in the Taffu Media Contract is Taffu Media Sdn Bhd and also for Bahasa Malaysia newspapers;

(ii) Secondly, this Taffu Media Contract is null and void because Taffu Media Sdn Bhd did not authorise the signatory Murali R Ram to sign and enter into any contract as confirmed by Taffu's solicitors; and

(iii) Thirdly, the Parole Evidence Rule is expressly enacted to prevent such oral allegations.

And also relies on conclusive evidence clause in respect of certificate of outstanding.

The Law on Stay Pending Counter Claim

1. It is well established that if there is plausible counterclaim exceeding the amount claimed by the plaintiff then the defendant can ask for stay of execution. (see Lee Guat Eng v. Seet Tian Hock , [1974] 1 MLJ 178).

2. In Ronald Quay (supra) , the court allowed the plaintiff's claim for summary judgment but stayed execution of the judgment pending the disposal of the defendant's counterclaim. In that case the claim by the plaintiff was a sum for services rendered. The defendant admitted the claim and made a counterclaim for a larger sum than the plaintiff's claim alleging that the plaintiff had breached their contractual obligation and thereby the defendant had suffered loss of sales and accruable profits. The senior assistant registrar gave summary judgment for the plaintiff but ordered a stay of execution pending the trial of the counterclaim. The plaintiff appealed to the judge. The court affirmed the decision of the senior assistant registrar and stated that if there was a plausible counterclaim the court will stay the execution of the judgment pending the disposal of the counterclaim.

3. If the counterclaim is not bona fide the court will not grant a stay of execution. What amounts to a plausible counterclaim was considered by Zakaria Yatim J who observed:-

"With regard to the question of plausible counterclaim, it is necessary to ascertain what constitutes a plausible counterclaim? In the Societe's case, Abdoolcader J. stated the proposition that if "the defendant sets up a plausible counterclaim for an amount not less than the plaintiff's claim, the order ... should be for judgment for the plaintiff on the claim with a stay of execution until the trial of the counterclaim." The learned Judge based this proposition on the decision of the court of Appeal in England in Sheppards & Co. v. Wilkinson & Jarvis. In that case, the Master of the Rolls said:-

"There might be either a defence to the claim which was plausible, or there might be a counterclaim pure and simple. To shut out such a counterclaim if there was any substance in it would be an autocratic and violent use of Order XIV. The court has no power t