Back
2026 MarsdenLR 2025
HIGH COURT SABAH & SARAWAK TAWAU
STEVE RITIKOS, JC
IDS MEDICAL SYSTEM (M) SDN BHD – Appellant
Versus
TAWAU SPECIALIST MEDICAL CENTRE SABAH SDN BHD – Respondent
[Suit No: TWU-22NCvC-21-8/2025 (HC)]
Summary judgment is appropriate when a defendant fails to raise a triable issue. A defendant cannot defeat such an application through bare assertions or inconsistent denials that are contradicted by the documentary evidence and the parties' course of conduct.
Headnote:(A) Rules of Court 2012 - Order 14 Rule 1 and 3 - Summary Judgment - Principles governing grant of summary judgment - Burden of proof.
(B) Contracts Act 1950 - Sections 2(d), 24, 26, 60 and 61 - Legality of contract - Consideration - Appropriation of payments.
(C) Limitation Ordinance (Sabah Cap 72) - Item 95 - Limitation period for contractual claims - Six-year bar.
Facts of the case:
The plaintiff applied for summary judgment for outstanding payments regarding the supply and delivery of goods. The defendant contended that the transactions were part of an unfulfilled re-financing arrangement, argued that the claim was time-barred under local limitation laws, alleged lack of privity of contract, and characterized the underlying agreements as illegal or void for want of consideration. The defendant also asserted that existing payments had been misallocated and claimed a rebate as an equitable set-off.
Findings of Court:
The court determined that the defendant offered mere bare assertions unsupported by documentary evidence to substantiate the existence of a re-financing arrangement. The court held that the defendant’s payments and documentation proved a valid contract for the supply and delivery of goods, not a financing scheme. Furthermore, the court found that the defendant could not benefit from the limitations defence because the cause of action accrued well within the statutory period, and the defendant’s claims of illegal consideration and lack of privity were incompatible with their own course of performance.
Issues: Whether the defendant raised any triable issue or showed a fair or reasonable defence to the plaintiff's claim for goods sold and delivered, specifically regarding the existence of an overarching financing agreement, the applicability of limitation periods, and the validity of the underlying contracts.
Ratio Decidendi: A defendant seeking to defeat a summary judgment application must present more than mere assertions or equivocal denials; they must provide evidence that raises a triable issue of fact. Where a defendant’s arguments are inconsistent with their own conduct—such as making partial payments—and are not supported by contemporaneous records, such defences are not bona fide. The court is not bound to accept statements that are inherently improbable or lack precision.
Result: Plaintiff's application for Summary Judgment allowed; judgment entered for the principal sum, interest, and costs.
| Table of Content |
|---|
| 1. basis for a summary judgment application for goods sold and delivered. (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9) |
| 2. procedural prerequisites and the shifting burden of proof for summary judgment. (Para 10 , 11 , 12 , 13 , 14 , 15 , 16 , 17) |
| 3. validity of contract, alleged re-financing arrangements, and grounds for illegality. (Para 18 , 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27) |
| 4. limitation periods, privy of contract, and principles of payment appropriation. (Para 28 , 29 , 30 , 31 , 32 , 33 , 34 , 35 , 36 , 37 , 38) |
| 5. court’s evaluation of bare assertions regarding re-financing agreements. (Para 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46) |
| 6. prohibition against inconsistent claims regarding contract illegality; role of goods delivery. (Para 47 , 48 , 49 , 50 , 51 , 52) |
| 7. determination of when a cause of action accrues for limitation purposes. (Para 53 , 54 , 55) |
| 8. privity of contract precludes reliance on agreements involving external third parties. (Para 56 , 57 , 58 , 59 , 60 , 61 , 62) |
| 9. proof of valid contract through delivery orders despite internal accounting discrepancies. (Para 63 , 64 , 65 , 66 , 67 , 68 , 69 , 70) |
| 10. right of creditor to apply funds to outstanding accounts in absence of appropriation instructions. (Para 71 , 72 , 73) |
| 11. conditional rebates fail where payment obligations remain unfulfilled; summary judgment granted. (Para 74 , 75 , 76 , 77) |
JUDGMENT
(On Enclosure 5)
The Application
[1] Enclosure 5 is the plaintiff's Notice of Application under O 14 r 1 of the Rules of Court 2012 and under the inherent jurisdiction of the Court for summary judgment to be entered against the defendant for the sum of RM3,842,204.90 as at the 6 July 2025, interest at the rate of 1% per month on the outstanding sum from 7 July 2025 until full realization, costs on a solicitor and client basis and any further or other relief as the Court deems just and fit.
[2] The cause papers which will be referred to in this application are:
(i) The plaintiff's Statement of Claim dated 1 August 2025 (Encl 2) ("SOC");
(ii) Defendant's Statement of Defence and Counterclaim dated 26 August 2025 (Encl 8) ("SOD");
(iii) Plaintiff's Statement of Reply To The Defence & Statement of Defence To Counterclaim dated 10 September 2025 (Encl 11);
(iv) Defendant's Reply to plaintiff's Defence To Counterclaim dated 22 September 2025 (Encl 13);
(v) The Notice of Application (Encl 5) ("NOA");
(vi) The Affidavit In Support affirmed by Au Eng Chuan on the 19 August 2025 (Encl 6) ("AIS");
(vii) The Affidavit In Opposition affirmed by Lim Nyuk Fah on the 4 September 2025 (Encl 10) ("AIO");
(viii) The Affidavit In Reply affirmed by Au Eng Chuan on the 12 September 2025 (Encl 12) ("AIR")
Plaintiff's Claim
[3] The plaintiff's claim is for the sum of RM3,842,204.90 calculated as at 6 July 2025 being outstanding monies for the supply and deliveries of medical supplies and equipment issued via a series of Purchase Orders ("PO") around 2020 by the defendant to the plaintiff ("the Goods"). The Goods were supplied and delivered to the defendant in accordance with the terms of the PO, which were acknowledged receipt by the defendant in good and acceptable manner via Delivery Orders ("DO"). The PO and DO create a valid contract between the plaintiff and the defendant.
[4] The plaintiff issued invoices for the Goods supplied, and duly received by the defendant. The terms of payment stipulated in the invoices required the defendant to settle the amount due within 1 month from the date of the invoices, failing which interest at the rate of 1% per month would be levied on the outstanding sums until the date of full realization.
[5] The plaintiff had performed its obligations under the contract, however the defendant failed to make full payment for the Goods supplied. Partial payments were made toward the Invoices however the last payment made was on or around July 2024, and agreed interest at the rate of 1% per month was charged from the due date for all overd
