JUDGMENT

Lee Hun Hoe CJ (Borneo):

This appeal against the decision of the learned Judge is concerned with the question of agency.

Respondents are architects with their head office in Kuala Lumpur and a branch office in Kota Kinabalu. Appellant purported to be the authorised over-seas agent of Continental Development Co. of New York (to be referred to as "CD Co.). Samuel Li Kwan Yuk (PW1), an associate of the respondents' firm in Sabah, testified that he had done a valuation for appellant in respect of Po Hing Estate in 1968 but which was completed some time in 1969. On 18 June 1969 appellant spoke to him, among other matters, the preparation of an industrial lot in Sandakan and told him that the terms of engagement would be similar to that of Po Hing project. Consequently, by a letter bearing the same date appellant wrote to respondents as follows: -"Sandakan 18 June 1969.

Messrs. Booty Edward & Partners, P.O. Box 840, Kota Kinabalu.

Dear Sirs,

With reference to our telephonic conversation this morning, I write to confirm your appointment as the Appraiser to produce a report on the Proposed Light Industrial Site at L20828 at Mile 23/4, North Road, Sandakan, giving valuations as follows:

(1)Present value inclusive of all development works done to date;

(2)Value at completion of land development including road completion; and

(3)Value of completion including building of the proposed factories.

Your early attention will be much appreciated.

Yours faithfully,

For CONTINENTAL DEVELOPMENT CO NY,

SIGNED (Ching Yuen Tung) Authorised Overseas Agent.

c.c. Mr. DG Keefe, Sr, The Executive Vice-President, Continental Development Co., NY,

Messrs Yuen Hap Development Co. Sandakan. P.O. Box 320, Sandakan, Sabah, Malaysia, Telephone No 7798 Telegraphic Address: 'CHINYUTUNG' Sandakan."

According to PW1 appellant gave him to understand that the developers in this case were Yuen Hap Development Co. The valuation report was prepared and copies duly supplied to appellant and to Mr. DG Keefe Sr on the instructions of appellant, but the fees $4,985 (see Exh. P5) and other disbursements $1,135.40 (see Exh. P6) totalling $6,120.40 had not been paid by appellant despite repeated demands.

At the time respondents undertook the light industrial project Po Hing project was nearing completion. Respondents received full payment from appellant for the Po Hing project in July 1969. The cheque was issued by Po Hing Enterprise Co. Sdn. Bhd.

By a letter dated 13 May 1970 respondents wrote to appellant in the following terms:

We refer to our bill of fees Nos. JE47/1(975) dated 30 August 1969 for $4,985 and JE47/2(979) dated 18 September 1969 for $1,135.40 for the work carried out according to your instructions have already remained outstanding for more than seven months.

Your co-operation to settle these outstanding bills by sending us your cheque by return mail will be appreciated.

In the event that you have any queries on our bills please write to us immediately.

Appellant replied on 8 June 1970 as follows:

Re: Bill No. JE47/1[975] for $4,985.00

Bill No. JE47/2 [979] for $1,135.40

I refer to your previous correspondence in respect of the above-mentioned bills.

I regret to say that I was merely the authorised overseas agent for Continental Development Co. of New York. As such I am not personally liable for payment of your aforesaid bills. However, I will bring this matter to the attention of my Principal, or rather, his estate, as he has recently deceased.

Yours faithfully,

SIGNED (Ching Yuen Tung).

PW1 was shocked to receive the letter and to learn that appellant was passing the bill to someone. Appellant informed him it would take time to settle the bill as he had some problem with his principal since one of the Directors had passed away. Eventually, respondents sued appellant.

At the trial only PW1 gave evidence and produced various documents. Counsel for appellant submitted that respondents had not proved their case on balance of pr