Liability for negligence in unlawful seizure of goods under the Trade Descriptions Act hinges on reasonable cause.

[1] The respondent, Multi Inrich Sdn Bhd, sued the appellants, inter alia, for a declaration that it had been maliciously prosecuted for an offence under the Trade Descriptions Act 1972 ("the TDA") and for a declaration that the appellants had acted in breach of duty and/or committed negligence in confiscating, seizing, detaining or otherwise unlawfully disposing of its goods and business equipment which were later not used in the criminal trial of the respondent.

[2] The respondent's case was that on 10 July 2009, the 2nd and 3rd appellants, without showing any court order or warrant, entered its premises at Wawasan Plaza and Kompleks Kilang SME and confiscated all its goods and business equipment. The goods and equipment seized were the following:

(i) 4016 bottles of Lactovida Premium 1000ml (with Moringa extract);

(ii) 12 bottles of Lactovida Classic 1000ml;

(iii) 35 gallons of Liquid Gallons;

(iv) 2360 empty plastic bottles;

(v) 23 bundles of Bottle Stickers;

(vi) 1 unit of Laminator Machine Model C-2301-P;

(vii) 1 unit Blower W Bule-Decker Model BHP 1500-2; and

(viii) 1 unit of Tape Printer Model Kunba Motor Model YY70-15.

[3] The respondent was later charged in the Sessions court at Kota Kinabalu with the offence of offering for sale 881 bottles of Lactovida drink with false trade description under s 3(1)(b) of the TDA. However, the respondent was acquitted and discharged without its defence being called on 29 April 2011, meaning to say the prosecution could not even establish a prima facie case against the respondent. There was no appeal against the decision.

[4] On 12 January 2012, the respondent claimed back all the goods seized but was told by the 1st appellant that the goods had been disposed of in accordance with the court's direction. The respondent's grievance was that as a result of the raid and seizure, its business ceased to operate and it was subsequently sued by its creditors to recover the loans that they had given to it. The respondent then filed the present suit against the appellants to claim for damages for the seizure and retention of goods that the prosecution did not use at the criminal trial.

[5] After a full trial in the High court, the respondent succeeded in its action for negligence but failed in its action for malicious prosecution. Both sides appealed to this court against the decisions, the appellants appealing against the decision finding them liable in negligence and the respondent appealing against the decision dismissing its claim for malicious prosecution.

[6] Having heard arguments by both sides, both oral and written, we unanimously allowed the appellants' appeal and dismissed the respondent's appeal. These are the grounds of our decision.

[7] We shall first deal with the appeal by the appellants against the decision finding them liable for negligence. 14 grounds of appeal were proffered by the appellants but in our view the appeal turns on s 34 of the TDA, which provides as follows:

"No person shall in any proceedings before any court in respect of the seizure of any goods seized in exercise or the purported exercise of any power conferred under this Act be entitled to the costs of such proceedings or subject to s 32 to any damages or other relief unless such seizure was made without reasonable or probable cause."

[Emphasis Added]

[8] Section 32 referred to in the above s 34 relates to the forfeiture of goods seized under the TDA, which is not relevant for purposes of this appeal as none of the goods were forfeited pursuant to that provision. The issue for the High court's determination in relati