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1985 MarsdenLR 184

PRIVY COUNCIL, MALAYSIA
DATUK JAGINDAR SINGH & ORS – Appellant
Versus
TARA RAJARATNAM – Respondent
[Appeal No 39 Of 1983]



Lord Keith of Kinkel J:

This is an appeal from a JUDGMENT dated May 16, 1983 of the Federal Court of Malaysia (Lee Hun Hoe C.J. (Borneo), Salleh Abas C.J. (Malaya) and Eusoffe Abdoolcader F.J.) dismissing an appeal from judgments dated July 17, 1982 and November 21, 1982 of the High Court of Malaya (Abdul Razak J.), whereby the appellants were ordered to pay the respondent by way of damages the sum of $973,000 with interest at 6% per annum on the sum of $370,260 from July 1975 till July 1982 and interest at 8% per annum on the judgment sum from November 21, 1982.

The claim upon which the respondent had thus obtained judgment was based upon a number of grounds —— fraud, breach of contract, undue influence and breach of trust. The learned trial judge found that fraud had been established against all three appellants and his finding was upheld by the Federal Court.

The narrative of relevant events, so far as based on undisputed facts, is as follows. In 1973 Dr. Das, brother of the respondent's late husband, Devan, conceived the idea of opening in Singapore a medical computer centre called Medidata. For this purpose he required a large amount of finance, and he arranged a substantial loan from the Moscow Narodny Bank. He also approached the first appellant Jagindar Singh, an advocate and solicitor carrying on business in Johore in partnership with the second appellant Pakrisamy Suppiah, who is similarly qualified, under the firm name of Suppiah & Singh. The first appellant, a friend of Dr. Das from student days, agreed to guarantee for the latter an overdraft with the Hong Kong and Shanghai Bank ("HKS Bank") up to a limit of $120,000, and duly did so on October 8, 1973. The overdraft facility was drawn upon and the debit balance mounted up. About the beginning of 1974 the first appellant began to press Dr. Das to clear the overdraft or to provide security for the guarantee. Dr. Das offered a second mortgage over his dwelling house and business premises, already charged to the Moscow Narodny Bank. The first appellant rejected this and expressed interest in five acres of land at Kulai the title to which was registered in the name of the respondent and upon which stood the family home occupied by her and her husband and their five daughters. Devan had a certain beneficial interest in the property, but the greater part was owned by the respondent. This land was subject to three charges in favour of the Chung Khiaw Bank ("CK Bank") to secure an overdraft on current account in the name of Devan. Dr. Das agreed to seek the assistance of Devan, and the two of them later attended at the office of the first and second appellants to discuss matters. A number of further meetings took place between Devan and the first and second appellants. On March 12, 1974 Suppiah & Singh wrote to the CK Bank stating that they acted for the respondent and that the respondent wished to pay off the charges on her property at Kulai by charging it for an increased amount. They asked for a statement showing the amount due to the Bank on Devan's overdraft and for the title deeds to the property. On March 14, 1974 the Bank wrote to Suppiah & Singh stating that the sum at debit Devan's account was $103,658.44 with interest at 11.5% per annum and enclosing the title deeds.

On March 30, 1974 the first and second appellants presented themselves at the respondent's house, together with a third person, Sivananthan, who appears to have accompanied them just for the ride in the first appellant's new Mercedes. The second appellant had in his possession an undated transfer in form 14A of the National Land Code bearing that the respondent thereby transferred the Kulai land to the second appellant in consideration of the sum of $220,000, an undated letter of confirmation that the dwelling house on the land was included in the transaction, and also a Memorandum in these terms:-

"I, TARA RAJARATNAM (f) NRIC No. 2317344 of No. 76, Main Road, Kulai, Johore, proprietor of the land desc

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