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2021 MarsdenLR 88
HIGH COURT MALAYA JOHOR BAHRU
GOH HAI LOONG & ANOR – Appellant
Versus
KER ZEE WEI – Respondent
[Civil Appeal No: JA-12ANCVC-31-10-2020]
Timely application to set aside a regular judgment and substantiated defenses are critical for the court's discretion in granting such applications.
Headnote:(A) Civil Procedure - Application to set aside judgment in default – The court must ascertain if the judgment was regular or irregular – Consideration of delay in filing application to set aside – Must be made within 30 days as per O 42 r 13 of the Rules of 2012. (Paras 5, 9, 10)
(B) Fraud allegations – Defendants contended that they were deceived into signing blank forms but failed to provide evidence or police reports, thus these claims were deemed baseless. (Paras 20, 22)
Facts of the case: The Defendants defaulted on personal loans obtained from the Plaintiff, leading to the entry of judgment in default against them after failing to file a defense despite extensions. (Paras 2-4)
Findings of Court: The JID was regular, and the Defendants' delay in filing their application to set it aside was unjustified. The appeal was dismissed. (Paras 23, 24)
Issues: Determining the regularity of the JID and whether a satisfactory defense was available to the Defendants. (Paras 8, 19)
Ratio Decidendi: A delay of 17 months in filing to set aside a regular judgment necessitates dismissal; fraud claims without substantiation do not constitute a defense. (Paras 9, 20)
Result: Appeal dismissed with costs.
JUDGMENT
Introduction
[1] This was an appeal ("this Appeal") against the decision of the learned Sessions Court Judge ("SCJ") on 22 September 2020, who dismissed the Appellants' application to set aside the judgment in default ("JID") entered against them. For ease of reference, the Appellants and Respondent will be referred to respectively as the Defendants and Plaintiff.
The Background Facts
[2] The Defendants are a married couple who had obtained, from the Plaintiff, several personal loans which monies were deposited directly into the First Defendant's bank account.
[3] They defaulted in repayments and as a result thereof, the Plaintiff issued several demand letters but to no avail. On 13 December 2018, the Plaintiff filed a suit ("this Suit") against the Defendants. The Defendants entered an appearance on 11 January 2019, but never filed a Defence, despite being given an extension of time to do so. As a result thereof, JID was recorded against the Defendants on 12 February 2019.
[4] On 27 July 2020, the Defendants filed an application to set aside the JID, which was dismissed. Hence this Appeal, which was also dismissed, for the following reasons.
The Applicable Law
[5] The approach when considering an application set aside a judgment in default is, that the Court must first ascertain if the judgment in default was a regular or irregular one. If the judgment in default was an irregular one, it should be set aside ex debitio justitae.
[6] However, if the judgment in default was regularly obtained, the Court then has to determine whether there was a defence on merits. In doing so, the delay in making the application to set aside is a factor to be considered by the Court in deciding whether to grant or refuse the application.
[7] This is trite law as was succinctly put by the Court of Appeal in Yap Ke Huat & Ors v. Pembangunan Warisan Murni Sejahtera Sdn Bhd & Anor, .
Whether The JID Was Regular?
[8] The Defendants contended that the JID was irregular because of the issue of fraud that they had raised in relation to the Plaintiff's claim. In my view, this contention was bereft of merit since such issue had no bearing on whether the JID was irregular or otherwise. The issue of fraud raised by the Defendants was relevant, if at all, to demonstrate a defence on merits. In the present case, therefore, the JID was in fact regular.
Whether The Delay Was Satisfactorily Explained?
[9] Since the JID obtained against the Defendants was regularly entered, the Defendants were, therefore, required to file the application to set it aside within 30 days from the date of receipt, as provided by O 42 r 13 of the Rules of 2012 ("Rules of "), which reads:
Order 42 - Judgment and orders
Rule 13 - Setting aside or varying judgment and orders
Save as otherwise provided in these Rules, where provisions are made in these Rules for the setting aside or varying of any order or judgment, a party intending to set aside or to vary such order or judgment shall make an application to the Court and serve it on the party who has obtained the order or judgment within thirty days after the receipt of the order or judgment by him.
[Emphasis Added]
[10] Since the JID was served on 15 February 2019, and such application was filed only on 27 July 2020, a delay of approximately 17 months had occurred from the time the JID was received.
[11] The importance of complying with this time period was underscored in several cases including the Court of Appeal cases of Mirra Sdn Bhd v. The Ayer Molek Rubber Co Bhd , [2008] 2 MLJ 348, Khor Cheng Wah v. Sungai Way Leasing Sdn Bhd ; [1997] 1 CLJ 396; [1996] 1 AMR 846, and Thye Ah Chai v. Teraju Mercu Construction & Engineering Sdn Bhd; and the High Court case of Malayan Banking Bhd v. Mahmood Zuhdi Hg Mohd Nor; [2001] 6 MLJ 209; [2001] 6 CLJ 171.
[12] In Mirra Sdn Bhd v. The Ayer Molek Rubber Co Bhd , the application to set aside the judgment in default was filed four months after it was served on the defendant. The Cou
