JUDGMENT

Noradura Hamzah JC:

Introduction

[1] This is an appeal by the three defendants. They appeal against the whole of the decision of the Sessions Court Judge ("the SCJ") given on 31 December 2025. The SCJ allowed the plaintiff's claim in the sum of RM184,000.00. She ordered interest at 5% per annum on that sum. She awarded the plaintiff costs of RM10,000.00. She dismissed the defendants' counterclaim with costs of RM5,000.00.

[2] I refer to the parties as they were in the Sessions Court . The 1st Appellant, Phenom Interior Design Sdn Bhd, is the 1st Defendant. The 2nd and 3rd Appellants, Low Cheng Kheng and Hoo Yin Cheng, are its directors. They are the 2nd and 3rd Defendants. The respondent, Chandra Bosh a/l Muniandi, is the plaintiff.

Background

[3] The Plaintiff owns a house at No 15, Jalan Sasa 58, Taman Gaya, Ulu Tiram, Johor. By an invoice dated 3 March 2019 the 1st Defendant agreed to reconstruct and renovate the house for RM230,000.00. The 1st Defendant is a renovation contractor. The Plaintiff paid RM184,000.00 by instalments. The 2nd and 3rd Defendants were added to the action by amendment in November 2023.

[4] The Plaintiff's case was as follows. The works were late, defective, incomplete, and below standard. The 1st Defendant did not rectify the defects after notice. The 1st Defendant was not registered with the Construction Industry Development Board ("CIDB") at the time it carried out the works. It registered only on 11 August 2021. The directors had represented an expertise that they did not have. On 24 July 2020 the plaintiff met the 1st Defendant's representative and the works were still incomplete. He terminated the engagement by his solicitors' letter of demand dated 4 August 2020. He sued for breach of contract, negligence and misrepresentation.

[5] By his Amended Statement of Claim the plaintiff prayed for special damages of RM500,000.00, general damages to be assessed, interest and costs. His particulars of loss put the cost of a replacement contractor to complete and rectify the works at RM542,787.50. That figure came from a quotation of Dewani Design Sdn Bhd dated 20 November 2020. In the course of the trial his counsel stated that the RM500,000.00 was no longer pursued and that the plaintiff sought the return of the RM184,000.00 he had paid.

[6] The 1st Defendant counterclaimed. It sought a declaration that the termination was unlawful. It claimed the unpaid balance of the contract sum, which it put at RM50,436.00. It also sought the return of materials. The trial ran over seven days. The plaintiff (SP1) and one other witness (SP2) gave evidence. The defence called one witness (SD1). The 2nd and 3rd Defendants did not give evidence.

[7] The SCJ held that the contract was enforceable despite the want of CIDB registration. She found that-

(a) the 1st Defendant had breached the contract and been negligent; and

(b) the defects were not trivial and undermined the usability of the premises.

[8] The SCJ held that the plaintiff was entitled to RM184,000.00 and lifted the corporate veil against the directors. The SCJ dismissed the counterclaim.

Analysis

[9] There are nine grounds of appeal. They raise five issues, which I address in turn-

(a) whether the want of CIDB registration voided the contract;

(b) the plaintiff did not prove his claim, or fraud, or that the works fell below standard;

(c) there was no proper basis to award RM184,000.00;

(d) fraud was not proved against the directors, who are protected by the separate legal entity principle; and

(e) the counterclaim ought to have succeeded.

[10] An appeal from the Sessions Court is a rehearing on the record. This Court will not lightly disturb findings of fact. Those findings turned on the SCJ's assessment of the witnesses she saw. This Court will intervene only if the decision is plainly wrong. A decision is plainly wrong where there is a lack of, or insufficient, judicial appreciation of the evidence. [See: Gan Yook Chin & Anor v. Lee Ing Chin & Ors; [2005] 2 M