JUDGMENT

Steve Shim CJ (Sabah & Sarawak):

On 21 June 2004, the Federal Court granted the appellant leave to appeal on the following questions:

1. Should the standard of proof in civil cases for "forgery" as expressed to be on a balance of probabilities in the decision of the Federal Court in Adorna Properties Sdn Bhd v. Boonsom Boonyanit [2001] 2 CLJ 133 be applied also to the case of "fraud"?

2. Whether the inclusion of further evidence under r. 7(3A) of the Rules of the Court of Appeal 1994 precludes the plaintiffs/respondents from particularizing the incidents of fraud in the statement of claim as prescribed by O. 18 r. 12 of the Rules of the High Court 1980?

In the memorandum of appeal, the appellant has advanced 13 grounds but they appear to relate only to the first question. This is hardly surprising since the second question is quite inconsequential to the issues in dispute between the parties. It is in that context that our consideration must fall.

Now, this case involved a dispute over 2 pieces of land known as EMR 1265 Lot 1346 and EMR 1266 Lot 1347 Mukim of Selama, Perak (the said lands). They belonged to one Hor Choy, the grandfather of the respondents. On 30 December 1966, Hor Choy executed a deed of trust over the said lands. He was to hold them on trust for the respondents, who were then minors, until they reached the age of majority. In the meanwhile, Hor Choy was conferred the power of sale of the said lands. However, Hor Choy died on 26 November 1969. As the respondents were still minors, the administration of the said lands was entrusted to their father Ho Too Onn. In 1974, Ho Too Onn allowed the appellant to use the said lands for 10 years after which they were to be handed back to the respondents. In 1984, upon attaining the age of majority, the respondents asked the appellant for the return of the said lands. The appellant refused claiming that he had actually purchased the said lands from the late Hor Choy in June 1969 for RM10,400. He also claimed to be the legal owner since 1969 and had applied for and obtained titles in continuation in respect of the said lands in 1976. The respondents thereafter took out an action seeking inter alia a declaration that the transfer of the said lands from Hor Choy to the appellant was null and void; that the appellant was to execute a proper transfer of the said lands to the respondents or alternatively, that the land office be required to execute the said transfer. The basis of the respondents' action was that the appellant obtained the said lands by fraud and falsification of documents. After a full hearing, the High Court found against the respondents. However, on appeal by the respondents, the Court of Appeal reversed the decision of the High Court.

In connection with the first question, the following passage in the judgment of the Court of Appeal is relevant. It states:

The learned Judge held that the Plaintiffs failed to prove fraud beyond reasonable doubt against the Defendant. He relied on the authority of Saminathan v. Pappa [1981] 1 MLJ 121, a Privy Council case. With due respect, the learned judge applied the wrong standard of proof on fraud. The proper test is that on a balance of probabilities (see Adorna Properties Sdn Bhd v. Boonsom Boonyanit [2001] 2 CLJ 133) FC.

Given the position taken by the Court of Appeal, it is, we think, appropriate to examine in some detail the two cases cited above. In Adorna Properties Sdn Bhd, the Federal Court said inter alia:

For proof of forgery, such as the one under appeal, whether the standard of proof is on a balance of probabilities or beyond reasonable doubt?

The same arguments which the parties had put before both the High Court and the Court of Appeal were again argued before us. The High Court held that forgery must be proved beyond reasonable doubt, while the Court of Appeal held that it should be on a balance of probabilities. For the reasons given by the Court of Appeal we entirely agree that the standard of pr