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2011 MarsdenLR 4594
HIGH COURT, SANDAKAN
LAI KUI MIN – Appellant
Versus
HO KIM SHIN – Respondent
[Civil Suit No: S-22-71 Of 2009]
Misrepresentation requires demonstration of an untrue representation that induces the other party to act, emphasizing the necessity of clear communication about contract documents.
Headnote:(A) Contracts Act 1950 - Section 18 - Evidence Act 1950 - Section 103 - Misrepresentation - Court established that the defendant misrepresented intentions to procure buyers for land, inducing the plaintiff to sign a Memorandum of Transfer without understanding its implications - Key points included failure to explain the nature of the document and the consideration stated as 'love and affection,' which was deemed incorrect due to lack of actual affection between parties. (Paras 1-20)
(B) Burden of Proof - The defendant bore the burden to prove he explained the document's nature, which he failed to do. (Paras 15, 16, 20)
Facts of the case:
The plaintiff and his wife were misled by the defendant about a land transfer agreement, believing there would be payment after sale, invoking issues of misrepresentation and understanding.
Findings of Court:
Plaintiff established that the memorandum was signed based on defendant's inducement without adequate explanation of its nature, leading to a judgment for the plaintiff.
Issues: Did the defendant misrepresent his ability to sell the land? Did he explain the document's nature? Did the plaintiff understand what he was signing?
Ratio Decidendi: The court found that the defendant’s representations were misleading in nature, the plaintiff was not provided sufficient explanation about the document signed, and the burden of proof was not met by the defendant regarding the explanation of the document.
Result: Judgment entered against the defendant in favor of the plaintiff.
| Table of Content |
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| 1. issues of misrepresentation established. (Para 1 , 1 , 2) |
| 2. assessment of evidence related to misrepresentation. (Para 3) |
1. Having perused all the evidence in the present case, I find that some of the following issues proposed by the Plaintiff are pertinent for disposal of the present case namely:
[i] Did the Defendant misrepresent to the Plaintiff and the Plaintiffs wife that he could assist the Plaintiff and Ho Soo Khew to procure purchasers from China to purchase the said Land for lucrative price?;
[ii] Did the Defendant and/or the advocate Rahim Abdullah explain to the Plaintiff and Ho Soo Khew the nature of the documents which they signed?; and
[iii] When the Plaintiff and Ho Soo Khew signed the Memorandum of Transfer, did they know the nature of the documents which they signed?.
2. [1] The Plaintiff called the following witnesses for the trial:
[i]PW1-LaiKuiMin/Plaintiff;
[ii] PW2- Chong Nyuk Lan; and
[iii] PW3- Ho Sam Moi/Plaintiff's wife.
[2] As for the Defendant, he called the following witnesses namely: [i]DW1-HoAhYing; and [ii] DW2-Ho Kim Shin/Defendant; and [iii] DW3-Haji Rahim Haji Abdullah.
CONSIDERATION OF THE ISSUES
3. Issue [1] Did the Defendant misrepresent to the Plaintiff and the Plaintiff's wife that he could assist the Plaintiff and Ho Soo Khew to procure purchasers from China to purchase the said Land for lucrative price?
Issue [2] Did the Defendant and/or the advocate Rahim Abdullah explain to the Plaintiff and Ho Soo Knew the nature of the documents which they signed?; and
Issue [3] When the Plaintiff and Ho Soo Khew signed the Memorandum of Transfer, did they know the nature of the documents which they signed?
[i] I find that the Defendant did represent to the Plaintiff that he will assist the Plaintiff and Ho Soo Khew to procure purchasers from China to purchase the said Land for lucrative price and that such representation was untrue and based on this untrue representation, the Plaintiff was thereafter induced to sign the Memorandum of Transfer of the said land, based on the following grounds:
[a] I observe the demeanour of the witnesses for the Plaintiff and the Defendant, in particular that of the Plaintiff and the Defendant themselves and I find that the Plaintiff gave evidence in a straight forward manner which is capable of belief. I further prefer the evidence of the Plaintiff over that of the Defendant.
[b] I find that if what the Defendant contended is true, that is the Plaintiff agreed to transfer his shares in the said land to the Defendant because he failed to pay for the purchase of his shares in the said land, the consideration for the relevant Memorandum of Transfer of the Plaintiffs shares in the said land, should clearly and correctly state so and not for love and affection.
[ii] Section 18 of the Contracts Act 1950 defines misrepresentation as follows:
" Misrepresentation "
18. "Misrepresentation" includes:
(a) the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true;
(b) any breach of duty which, without an intent to deceive, gives an advantage to the person committing it, or anyone claiming under him, by misleading another to his prejudice, or to the prejudice of anyone claiming under him; and
(c) causing, however innocently, a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreement.
[iii] In Chuah long Yeong v. Kuala Lumpur Golf & Country Club , , His Lordship Abdul Wahab J set out the elements of misrepresentation as follows:
"For an action in misrepresentation to succeed it must be shown that there was:
(a) a representation;
(b) the plaintiff was induced by it;
(c) the representation was untrue; and
(d) the case was one suitable for rescission.
If the representation was merely innocent, the affected party would only be entitled to a rescission. Mere exaggeration is not representation but if it has the object and result of inducing an a
