JUDGMENT

James Foong J:

Introduction

[1] This is the second portion of the saga commonly known as 'Luggage Distributor's case' (Luggage Distributors (M) Sdn Bhd v. Tan Hor Teng & Anor [1995] 3 CLJ 520) made famous by the Court of Appeal's ruling that it is unlawful for a tenant to place a caveat over a rented property in order to protect the tenancy.

[2] Subsequent to the ruling by the Court of Appeal's the plaintiff, Quill Construction Sdn Bhd (whom I shall from now on refer to as 'Quill Construction' to avoid confusion over its role as plaintiff in the original claim and then as 1st defendant in the counterclaim) filed this action against the 1st and 2nd defendants (the tenant) for damages suffered as a result of the defendants' unlawful act in lodging the caveat. Summary judgment was obtained by Quill Construction before the senior assistant registrar (SAR) for a sum of RM222,548.46 with interest and costs. There was an appeal against this decision to the judge-in-chambers but Justice Malik Ishak on 11 April 2003 dismissed this appeal and affirmed the decision of the SAR.

[3] The defendants' then attempted to set aside the order for summary judgment by way of encl. 43. I heard and dismissed this application on 27 September 2003 for reason that the defendants failed to advance any merit in their complaint.

[4] In answer to the Quill Construction's claim, the defendants have filed a defence and counterclaim. The counterclaim is not only against Quill Construction. Luggage Distributors (M) Sdn Bhd (Luggage Distributors), the original landlord of the rented property, is also brought in as a defendant.

[5] Since the main claim by Quill Construction is disposed of, what is left to be settled in this case is the counterclaim of the defendants.

Defendants' Counterclaim

[6] From the pleadings, the defendants' counterclaim against Quill Construction and Luggage Distributors for:

(a) General damages.

(b) Special damages of RM980,000 made up of the following:

(i) having to purchase another property at overvalued price of RM900,000;

(ii) legal fees for the removal of caveat action amounting to RM20,000 and;

(iii) legal fee spent on the appeal to the Court of Appeal for removal of caveat action.

(c) Punitive damages.

(d) Interest at 8% per annum from 22 December 1993 until realization.

(e) Costs.

[7] These claims are based on the following allegations:

1. Quill Construction has by letter dated 22 December 1993 (Quill's letter of 22 December 1993) interfered with the defendants' rights to quiet and exclusive possession of the demised premises and the defendants' business notwithstanding the tenancy agreement (tenancy agreement) between the defendants and Luggage Distributors dated 8 July 1993.

2. Quill Construction has also interfered with the defendants' right to quiet and exclusive possession of the demised premises and the defendants' business by its letter dated 21 July 1995 (Quill's letter of 21 July 1995) which refuses to recognize the defendants' renewed tenancy term.

3. Quill Construction then interfered with the defendants' right to quiet and exclusive possession of the demised premises and the defendants' business by refusing to accept, unconditionally, the defendants' rentals for the renewed tenancy period; Quill Construction only accepted such rentals on a 'without prejudice' basis.

4. Despite having paid the full purchase price for the said property to Luggage Distributors, Quill Construction funded and maintained Luggage Distributors' application to remove the defendants' caveat.

5. Quill Construction and Luggage Distributors have champertously maintained this action against the defendants.

6. Quill Construction and Luggage Distributors had also conspired "to damage and drive away" the defendants' from their legitimate place of business or otherwise "to inflate the damages" claimed by Quill Construction in this action.

7. Quill Construction has induced Luggage Distributors to breach the tenancy agreement.

Defence

[8] Quill C