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2025 MarsdenLR 5904
HIGH COURT MALAYA KUALA LUMPUR
LYFEMED MEDICARE (M) SDN BHD – Appellant
Versus
PROFESSIONAL LATEX SDN BHD & ORS – Respondent
[Suit No: WA-22NCC-74-02/2023]
A claim cannot be sustained against a party with no contractual relationship nor unjust enrichment, emphasizing the necessity of a recognized cause of action in contractual disputes.
Headnote:(A) Contract Law - Legal obligations - Plaintiff sought recovery of a deposit paid for the manufacture of nitrile gloves during the pandemic - Contractual relationship existed only with the 2nd Defendant - 1st Defendant not bound by contract and was not unjustly enriched (Paras 1-3, 13-14).
(B) Misdirection in claims - Claims based on unjust enrichment and fiduciary duty unpleaded and unsupported (Paras 29-30, 31).
(C) Law of agency - No evidence proving agency relationship between the parties involved in the transaction - No contractual relationship established between the plaintiff and the 1st Defendant (Paras 12-26).
Facts of the case:
Plaintiff engaged with 2nd Defendant to purchase gloves, paying deposit to 1st Defendant, later discovering contract was solely with 2nd Defendant after deposit was utilized for order fulfillment.
Findings of Court:
Court found no contractual basis between the plaintiff and 1st Defendant for deposit refund; claim dismissed.
Issues: The main questions included establishing the contracting parties, whether the plaintiff had a contractual relationship with the 1st Defendant, and the liability of Tang.
Ratio Decidendi: The court held that the plaintiff had no contract with the 1st Defendant, emphasizing that neither unjust enrichment nor fiduciary duty obligations arose; any recourse was against the 2nd Defendant.
Result: Claim against the 1st Defendant dismissed with costs.
| Table of Content |
|---|
| 1. claim based on contract and relationships (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10 , 11) |
| 2. issues for determination relating to obligations (Para 12) |
| 3. clarification of contracting parties and lack of contract (Para 13 , 14 , 15 , 16 , 17 , 19 , 20 , 22 , 26 , 27 , 28) |
| 4. lack of fiduciary duty and unjust enrichment claims (Para 31 , 32 , 49) |
Introduction
[1] This action pertains to a claim born out of misdirection not of motive but of legal recourse. The plaintiff seeks to recover a deposit of money paid to secure the manufacture of nitrile gloves during the Covid-19 pandemic. The deposit was paid to the 1st Defendant but the contractual relationship and the corresponding legal obligation to refund the deposit lay not with the 1st Defendant but with the 2nd Defendant. Regrettably the 2nd Defendant has since been wound up rendering any claim against it futile. In the wake of that insolvency, the plaintiff now turns to the 1st Defendant in search of recovery. However, as the court must now determine, the law does not permit recovery from a party who was never bound by contract nor unjustly enriched by the payment. Sympathy, while not absent, cannot override the foundational principle that a claim must lie within the confines of a recognized cause of action.
Background Facts
[2] The Plaintiff, Lyfemed Medicare (M) Sdn Bhd ("Lyfemed") is a company that exports and imports rubber gloves.
[3] At all material times, the plaintiff dealt with the 2nd Defendant, Xali Pte Ltd ("Xali"), for the supply of nitrile powdered gloves for the plaintiff's customers.
[4] Xali, in turn, would order the nitrile powder gloves from the 1st Defendant, Professional Latex Sdn Bhd ("Professional Latex"), a glove manufacturer and supplier company.
[5] In this case, Lyfemed had sometime in May 2021, ordered 2,400,000 nitrile gloves ("the Nitrile Gloves") for the price of USD22,800,000.00 at USD 9.50 per piece from Xali. In order for Professional Latex to process and begin manufacturing Xali's order for Lyfemed's purchase, Professional Latex required Xali to place a deposit sum of USD950,000.00 ("the Deposit Sum") into its Hong Leong Bank Account No: 11500050968 ("the HLB Account").
[6] Towards the aforesaid, it is not disputed that Lyfemed had pursuant to Xali's instructions paid the Deposit Sum into the HLB Account. It is also not disputed that Professional Latex was aware that the Deposit Sum was paid into its HLB Account directly from Lyfemed.
[7] Further, it is also not disputed that Lyfemed had paid to the 3rd Defendant, Sendor Sdn Bhd ("Sendor") for all sums due and agreed with Xali as the purchase consideration in respect of the Nitrile Gloves that it had ordered. Payments were made to Sendor at the instructions of the 4th Defendant, Tang Kum Hoe ("Tang") who was at the material times, a director of Xali.
[8] Sometime in November 2021, after the Nitrile Gloves had been delivered by Professional Latex, Lyfemed requested Xali for the refund of the Deposit Sum. However, Xali failed to refund Lyfemed the Deposit Sum although a sum of RM100,000.00 was paid to the plaintiff by Tang, who at the time of payment was no longer a director of Xali.
[9] When Lyfemed wrote directly to Professional Latex for the refund of the Deposit Sum, Lyfemed was informed that based on its agreement with Xali, the Deposit Sum had been utilized towards deductions of the purchase price that was agreed between Xali and Professional Latex in respect of Lyfemed's orders. Whatever balance thereafter of the Deposit Sum after the deductions had been refunded to Xali.
[10] Not being satisfied, Lyfemed filed this action initially against Professional Latex only. Subsequently, Lyfemed added Xali, Sendor and Tang as the 2nd, 3rd and 4th Defendants respectively.
[11] However, by the time the matter came up for trial, Lyfemed had withdrawn its action against Xali and the action against Sendor had been struck out. Further, the solicitors for Tang had discharged thems
