JUDGMENT

Gopal Sri Ram JCA:

Introduction

There are two appeals before us. The appellant in Civil Appeal No W-03-41- 98 ("the first appeal") was the plaintiff in the court below. The respondent to the first appeal was the defendant. In Civil Appeal No. W-03-43-98 ("the second appeal") the roles are reversed. It is the defendant in the court below who is the appellant while the plaintiff is the respondent. We heard both appeals on 26 October 1998. Since both appeals arise from the same action and concern a common issue, we heard them together. The parties agreed to this course. At the conclusion of argument, we reserved judgment. We also directed parties to put in written submissions. This was done. We find it convenient throughout this judgment to refer to the parties according to the title assigned to them in the court below.

We said that both appeals raise a common issue. It has to do with the measure of damages that the defendant is liable to pay the plaintiff. In the first appeal, the plaintiff complains that he has received too little; in the second appeal, the defendant complains that it has been ordered to pay too much. The question at issue is simple enough. It is amply covered by settled authority. Yet, a brief reference to the factual matrix against which these appeals rest is necessary to properly appreciate the arguments raised before us.

Background

The litigation that has led to these appeals has a long and chequered history. On 26 May 1986, the plaintiff, who was then a serving judge of the High Court in Malaya, issued a writ against the defendant. His statement of claim reveals that he had, on 25 May 1982, entered into an agreement with the defendant, a developer, to purchase an apartment for RM236,000. The purchase price had been paid in full from loans disbursed to the plaintiff by two institutional lenders. Interest had been paid on these loans. The plaintiff complained that he had been induced to enter into the agreement in question on the basis of a false and fraudulent representation made by the defendant in its brochure. He claimed that in consequence thereof, he had lost the value of his investment. He particularised them in his statement of claim. The amount came to RM299,661.32. This sum was made up of the purchase price, the interest he had paid and some incidental expenses. At the foot of his pleaded case, he claimed the following relief:

(1) Rescission of the agreement of the 25th of May, 1982;

(2) The sum of RM299,661.32;

(3) Interest from the date of writ to the date of realisation;

(4) Damages;

(5) Such further or other relief; and

(6) Costs.

The defendant delivered a defence in which it traversed all points of importance raised by plaintiff in his statement of claim. A reply was then delivered by the plaintiff.

In due course the plaintiff's action came on for hearing before the High Court which dismissed it. The plaintiff appealed. The Federal Court allowed his appeal on 24 November 1995. Although it made several orders, we are only concerned with the following:

(1) that the agreement dated 25 May 1982 be set aside;

(2) that the sum of RM299,661.32 be refunded by the defendant to the plaintiff together with interest thereon at 8% per annum from 26 May 1986 until the date of full realisation;

(3) that the defendant do pay the plaintiff damages to be assessed by the High Court.

We pause to observe that although before us the plaintiff who appeared in person challenged the Bahasa Malaysia version of the first order, it is plain from his written submission tendered before the learned judge in the court below (at p. 33 of the Record in the first appeal) that he accepts that what the Federal Court ordered was rescission of the agreement in question.

On 24 February 1997, the defendant paid over to the plaintiff a sum of RM556,072.89, made up of the judgment sum of RM299,661.32 and interest on that sum which amounted to RM256,411.57.

Pursuant to the last paragraph of the Federal Court's o