DALAM MAHKAMAH TINGGI MALAYA DI SEREMBAN

GUAMAN SIBIL NO: 22-49-2002

ANTARA

ROMAN CONCRETE
TRADING SDN BHD ... PLAINTIF

DAN

LOW CHAI HING HOLDINGS

SDN BHD ... DEFENDAN

JUDGMENT

I. APPEAL

This is an appeal by the appellant-defendant

(“the defendant”) against the decision of the learned

registrar who on 17 July 2002 entered summar y

judgment against the defendant in the sum of

RM393,541.80 (“the said sum”) and interest at 8%

per annu m from the date of judg ment to the date of

realisation and costs under O. 14 of the Rules of the

High Court 1980.

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II. FACTUAL BACKGROUND

The plaintiff’s claim against the defendant is

for the said sum for building materials (“the

products”) supplied by the plaintiff as requested,

ordered and directed by the defendant, to the areas

prescribed by the defendant. Delivery orders,

invoices and statements of accounts sent to the

defendant were exhibited by the plaintiff.

The parties herein have entered into a suppl y

agree ment dated 2 August 1999 (“the suppl y

agree ment” ) in which the plaintiff was referred to

therein as the compan y and the defendant as the

distributor.

III. SUBMISSION FOR DEFENDANT

En. Liang Chong Beng, learned counsel for the

defendant, stressed that under clauses 2, 4, 5(1)

and (3) and 14(2) of the supply agreement, the

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plaintiff has failed to prove the details of the

products and the agreed purchase price.

He added that the delivery orders should not

be accepted by the court as the purchase price was

not stated there, in particular delivery orders No.

1213 and 1214 dated 7 December 2000 and 12

December 2000 respectively which were not

received nor signed by an yb ody.

He argued that delivery order No. 1140 dated

30 September 2000 contained a debit to another

party ie, Ming Yew Plumbing, and that some 69

delivery orders did not refer to invoices.

It was submitted that vide letter dated 5

January 2002 ie, before the commencement of the

suit herein, the defendant did deny and dispute the

plaintiff’s claim vide letter of demand dated 4

January 2002. The defendant had required the

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plaintiff to legally prove the debt but the plaintiff

has failed to do so.

Another stand was that vide letter dated 13

May 2002, the defendant required the plaintiff to

proceed to the defendant’s site and take back the

relevant products failing which the defendant would

levy a claim for storage charges and/or dispose of

the products as the defendant thought fit and

suitable, whereupon the defendant would not be

responsible for any loss or damage.

He also contended that delivery orders dated 2

January 2002 and 3 January 2002 showed the

plaintiff’s address as Lots 15142 and 15143 Jalan

Rasah 70300, Seremban and that the plaintiff has

sold the products to other parties in the state of

Selangor, in particular to the construction site in

Puchong which was managed by one Bukit Nilai

Development Sdn Bhd, as a result of which the

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plaintiff has breached clause 2 of the supply

agreement, thereb y depriving the defendant of the

profits and so the defendant was entitled to claim

for general damages and accounts. He concluded

that there are triable issues.

IV. PLAINTIFF’S RESPONSE

En. Azrul Hj. Zulkifli Stork, learned counsel for

the plaintiff, submitted that upon receiving the

products the defendant has never raised any

o b j ecti o n wit hin t he ti me pr es cri b e d u nd er c la us es

5(1) and (3) and 14(2), and so the defendant could

not now return the products.

He added that the defendant has never

rejected the state ment of account delivered b y the

plaintiff to the defendant and that the said sum was

based on products sold and delivered, which were

proved by invoices and delivery orders.

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He contended that at all ma t eri al ti me, the

s eri al n u mb e r s i n t he d eli v er y o rd e rs a nd t ho s e i n

the invoices tally.

V. DECISION ON APPEAL

1. General Principles Under O. 14

At this stage, it is pertinent to reiterate

the relevant principles governing O. 14

judgment.

Seah FJ in deli veri ng the judgment of the

Federal Court in National Company For

Foreign Trade v. Kayu Raya Sdn. Bhd.

[1984] 2 CLJ 220; [1984] 1 CLJ (Rep) 283

elucidated as follows:-

“…. For the purposes of an application under

Order 14 the preliminary requirements are:-

(i) the defendant must have entered an

appearance;

(ii) the statement of claim must have been

served on the defendant; and
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(iii) t h e a ff i d a v i t i n s u p p or t o f t h e
a p p l i c a t i o n m u s t c o mp l y w i t h th e
requirements of Rule 2 of the Order 14.
……

…. If …. th es e c ons i der at io ns a re sat is fie d,

the plaintiff will have established a prima facie
ca s e an d h e be comes en ti tl e d t o j u dgment .
The burde n th en s hi ft s t o th e de fen dan t t o
satisfy the Court why judgment should not be
giv en a gai ns t h im (s ee O r der 1 4 Rules 3 an d
4(1) ). ”

There has been no submission by the

defendant that these requirements have not

been co mplied with b y the plaintiff. That being

the case, the plaintiff is prima facie entitled to

summary judgment. The burden is then

shifted to the defendant to establish that there

are triable issues.

The defendants ma y do s o b y setting up a

bona fide defence or raising a bona fide triable

issue, though a complete defence need not be

shown. Whether or not a defence is bona fide

or an issue is bona fide triable depends on the

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facts or the law arising from each case. The

court is not to delve into the merits of the

issues raised by the defendants or whether the

defendants are likely to succeed or fail : Hong

Leong Finance Berhad v. Rextex Rubber

Products (M) Sdn. Bhd. & Anor. [1996] 4 CLJ

580 per Abdul Malik Ishak J and the cases

cited there.

2. Consideration of Defendant’s Case

The defendant’s case is actually founded

upon clauses 2, 4, 5(1)(i) and (3), 9 and 14(2)

of the suppl y agreement. Hence, the issue for

d e te r mi na ti o n by me is whether a proper

construction of these clauses would lead me to

the conclusion that the defendant has raised

the trial issues as alluded to above.

The s i gni f ica nce of t hes e claus es woul d

neces si tat e t hei r r epr oducti on as foll ows : -

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“2. The company hereby appoints the

di s tr ib uto r as i ts mai n di s tr ib uto r in
the territory for the sale of the products
a nd th e di s tri but or s ha ll w it h effec t on
a nd fro m th e . .. . day o f . . . . a nd s ubj ect
a s her ei nafte r me nt i one d be come t he
s ol e di st ri but or of t he pr oduc ts w i t hin
t he te rri t ory s ave t ha t t he c omp any
shall at all times retain the right to sell
di re ct t o an y pur cha s er out s id e t he
t er rit ory. In t he e ven t a pur cha s er
c ome s fr o m the t e r rit ory t he Comp a ny
un der ta ke to i nfor m t he pur ch as e r of
t he di s t rib uto r.

3. ……..

4. Subject only to the provisions of clause

9(1) hereof:

(1) For the company to send the

products to the distributor the
distributor shall place a minimum
order of one (1) lorry load
consignment of the products from
the company. In the event the order
shall be less than one (1) lorry load
consignment of products the duty to
pick-up the consignment is on the
distributor.

(2) If this agreement shall terminate for

any reason during the course of a
year of this agreement the quantities
of the products to be sold and
bought hereunder during the period
for which this agreement remains in
force shall be paid by the
distributor.

5.(1) T h e p r i c e s o f t h e p r o d u c t s p u r c h a s e d
hereunder shall be as set out in the
schedule hereto PROVIDED that the
company shall be entitled to increase
such prices in respect of any deliveries
after the …. day of …. by giving to the
distributor at least [TWO months] notice
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of its intention to make such increase as

shall be specified in such notice from the
date specified in such notice and if within
one month of the receipt of any such
notice by the distributor the parties
hereto shall fail to agree as to the prices
to be paid for the products purchased
hereunder with effect from the date
specified in such notice this agreement
shall automatically terminate with effect
from such specified date.

(i) The selling price of the product from

the distributor to the purchaser shall
be fixed by the distributor and the
company hereby agreed not to
interfere with the selling prices of the
products.

(2) ……
(3) The distributor shall pay the company
for all products sold to the distributor
in the following manner:-

a) t o be pa id ha lf ( 1 /2) of t he t ota l
purchase price within One (1) month
after the date of receipt of relevant
i nvo ic e.

b) T h e r e ma i n i n g h a l f ( 1 / 2 ) o f t h e
purchase price shall be paid by the
distributor to the company subject to
the sale of the products. The
payment shall correspond with the
sale price received by the distributor
on the products sold.

PROVIDED ALWAYS THAT in the event a

special quantity of products is so ordered
b y t h e d i s tr i b u t o r t h e n fu l l p u r c h as e
price shall be paid upon confirmation of
acceptance by the company or by way of
b a n k g ua r a nt e e a cc e p t a bl e to t he s ai d
c o mp a n y .
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6. ……
7. ……
8. ……
9. The company shall during the
continuance of this agreement and
subject as set out elsewhere in this
agreement

(1) provide the distributor with such

quantities of promotional materials
and samples of the products as the
company shall consider reasonably
necessary for the purposes of this
agreement but such materials and
samples shall so long as they remain
in the possession of the distributor be
the properly of the company;

(2) not to assign or purport to assign

this agreement or any of its rights or
obligations hereunder without the
consent of the distributor.

(3) not to appoint a second distributor

within territory.

10. ……
11. ……
12. ……
13. ……

14. If this agreement terminates for any

reason whatsoever

(1) …..
(2) the distributor shall forthwith return to
the company or as it may direct at the
cost of the distributor all goods or
products belonging to the company in
its possession or under its control
and/or advertising and promotional
matter relating to the products in its
control and in case of d e f a u l t t h e
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company shall be entitled without

notice to enter at any time upon the
premises where the said goods or
products may be for the time being and
to remove the same;

(3) …..”

The parties have not submitted on the

date of appointment of the defendant as a

distributor by the plaintiff although the date

was not specified in clause 2 of the supply

agreement. I take it that the date of

appointment is a non-issue.

Clause 4(1) refers to the duty of the

plaintiff to send the products to the defendant

wh e n t h e o rd e r i s f or a mi ni mu m o f on e l or r y

load, as any order below that would require

the defendant to collect the products from the

plaintiff. This is subject to clause 9 which

requires the plaintiff to provide the defendant

with necessary quantities of promotional

materials and samples, not to assign the

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agreement nor to appoint another distributor

within the territory ie, Selangor.

Under clause 4(2), in the event of the

termination of the supply agreement within

one year ie, before 2 August 2000, the

quantity of the products to be sold and bought

under the agreement during the period for

which the agreement remains in force shall be

paid by the distributor ie, the defendant.

Clause 5(1) empowers the plaintiff to

increase the price of the products by giving the

defendant two mo nths’ not ice and if within one

month of the receipt of any such notice by the

defendant, the parties fail to agree on the

prices to be paid, the agreement shall

automatically terminate from the specified

date. Clause 5(1) refers to deliveries of the

products without stating any date and no

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submission was made thereon. Hence, I view

this as a non-issue.

Clause 5(1)(i) gives the defendant the

power and right to fix the selling price of the

products without any interference by the

plaintiff while clause 5(3) requires the

defendant to pay the plaintiff for all the

products sold to the defendant ie, half the

total purchas e price within one month of the

date of receipt of the relevant invoice, while the

remaining half is subject to the sale of the

products.

Clause 5(3) contains a proviso that for a

special quantity of products ordered by the

defendant, full purchase price shall be paid

upon confirmation of the acceptance by the

plaintiff or by way of bank guarantee

acceptable to the plaintiff.

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Clause 14 provides for the consequences

of the termination of the agree ment.

Upon a proper construction of all the

aforesaid clauses in the supply agreement as

relied upon by the defendant, I am unable to

see any triable issue, nor are they of any

assistance whatsoever to the defendant.

The plaintiff’s claim is for goods sold and

delivered to the defendant by way of

consignment pursuant to the supply

agreement. All consignments and deliveries

have been accompanied by contemporaneous

invoices and delivery orders which in turn

were acknowledged by the defendant or the

defendant’s servants or emplo yees and

accompanied by the defendant’s rubber stamp.

Stat e me n t s of a cc o u nt were de s pat c he d t o t he

defendant who did not raise any objection or

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pr otest pri or to t he noti ce of de mand b y t he

plaintiff’s solicitors. Indeed, all the deliver y

orders were executed with the endorsement

“NOTE : Goods Sold Are Not Returnable”.

The plaintiff’s statement of account sent

to the defendant carried a reminder to the

defendant to inform the plaintiff in writing of

any discrepancy in the account within 10 days

of the receipt thereof but there was no

indication by the defendant of any discrepancy

in the account.

It is elementary that the defendant to

whom the goods have been sold and delivered

has a duty to pay for the goods or else the

ordinary business of commerce and industry

would result in chaos. Hence, s. 31 of the Sale

of Goods Act 1957 provides that:-

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“It is the duty of the seller to deliver the goods

and of the buyer to accept and pay for them in
accordance with the terms of the contract of
sale”
[emphasis added]

The allegation that there was a

discrepancy in the amount claimed by the

plaintiff and that the late payment charges

were unilaterally imposed by the plaintiff

clearly run counter to contemporaneous

documents such as invoices, delivery orders

and statements of account which have been

duly delivered to the defendant who had not

disputed them.

In Pernas Trading Sdn. Bhd. v.

Persatuan Peladang Bakti Melaka [1979] 2

MLJ 124, Petronas sued Persatuan Peladang

Bakti (BAKTI) for the balance of the price of

goods sold and delivered to BAKTI, but BAKTI

denied liability and sought to show that the

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goods were ordered for a thi rd par t y. Both the

learned registrar and the learned Judge of the

High Court dismissed the application by

Pernas for summary judgment under O. 14.

On appeal, the Federal Court through the

judgment of Salleh Abas FJ (later LP) held that

from the sales invoice and delivery note, the

goods were ordered by BAKTI which was

therefore liable, as a result of which summary

judgment was entered for Pernas.

The ab o ve Fed e r a l C o ur t d e ci s i o n w as

followed by Sinnathuray J of the Singapore

High Court in Team 108 Technical Services

v. Hujong Enterprises (Pte.) Ltd. [1987] 1

MLJ 272, where the material facts showed

substantial similarity with those in Pernas.

The learned Judge allowed the plaintiff’s

appeal against the registrar’s refusal to enter

summary judgment for the plaintiff, and the

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learned Judge’s decision was affirmed by the

Singapore Court of Appeal.

In the appeal before me, t here was a mere

denial by t he def endant but such mer e denial

has been held to be insufficient : per Chong

Siew Fai J (later CJ (SS)) in Huo Heng Oil Co.

(EM.) Sdn. Bhd. v. Tang Tiew Yong [1987] 1

MLJ 139 where the learned Judge allowed the

plaintiff’s appeal against the then president of

the sessions court’s refusal to enter summar y

judgment under O. 26A of the Subordinate

Courts Rules 1980. Summar y judgment was

hence entered for the pl aintiff.

In Emperee Industries Sdn. Bhd. v.

Genagco Sdn. Bhd. [1987] 1 CLJ 477, the

plaintiff’s claim is also for the price of goods

sold and delivered. Summar y judgment was

entered for the plaintiff by the learned registrar

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and on appeal by VC George J (later J CA), who

struck down the defendant’s contention of not

having ordered the goods, despite the existence

of delivery orders, invoices and statements of

account.

In Sykt. Pakar Kayu & Perdagangan

Sdn. Bhd. v. MAA-SK Sdn. Bhd. [1986] 1 CLJ

595, in response to the plaintiff’s application

for summary judgment, the defendant took a

stand somewhat different from the stand taken

by para 3 of the defendant’s own statement of

defence and complained that the plaintiff had

supplied more goods than ordered, short

supplied sawn ti mber in the l engths required

and over supplied timber at greater lengths

than ordered and had also s upplied ti mber not

ordered at all. VC George J (later JCA)

concluded that the complaints were a sham

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and did not provide any or any reasonable

defence.

Where a few delivery orders were not dul y

stamped though signed and annotated when

the statements of account were presented to

the defendants who duly made some pa yments

to the plaintiff, in Lek Chuan (M) Sdn Bhd v.

Shahpadu Properties Sdn Bhd [1995] 1 LNS

110, Haidar J (now CJ(M)) held that the

plaintiff and the defendant were not strangers

in respect of the materials supplied by the

plaintiff, and that the defendant has not

succeeded in raising a triable issue. Hence,

summary judgment was entered for the

plaintiff.

In my view, the facts in this appeal show

a plain and obvious case on the facts and the

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law and there is neither a bona fide defence

nor any bona fide triable issue.

3. Conclusion

In the circumstances, I hold that the

learned registrar is correct in entering

summary judgment for the plaintiff under

O. 14. I hereby affirm it. The defendant’s

appeal is hence dismissed with costs.

(DATUK WIRA LOW HOP BING)

Judge,
High Court Malaya,
Seremban

19th January 2004

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SOLICITOR:
Liang Chong Beng learned counsel for the defendant,
Tetuan TS Tan & Co,
A03-04, Tingkat 3,
P.J. Industrial Park,
Jalan Kemajuan Section 13,
46200 Petaling Jaya,
Selangor Darul Ehsan

En Azrul Hj Zulkifli Stork, learned counsel for the

plaintiff,
Tetuan Azharudin & Assoc,
Peguambela & Peguamcara,
No. 92, Jalan Melaka Raya 25,
Taman Melaka Raya,
75000 Melaka

Cases referred to:-

National Company For Foreign Trade v. Kayu Raya
Sdn Bhd [1984] 2 CLJ 220; [1984] 1 CLJ (Rep) 283

Hong Leong Finance Berhad v. Rextex Rubber

Products (M) Sdn Bhd & Anor [1996] 4 CLJ 580

Pernas Trading Sdn Bhd v. Persatuan Peladang

Bakti Melaka [1979] 2 MLJ 124
Huo Heng Oil Co (EM) Sdn Bhd v. Tang Tiew Yong
[1987] 1 MLJ 139

Emperee Industries Sdn Bhd v. Genagco Sdn Bhd

[1987] 1 CLJ 477
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Sykt Pakar Kayu & Perdagangan Sdn Bhd v. MAA-

SK Sdn Bhd [1986] 1 CLJ 595
Lek Chuan (M) Sdn Bhd v. Shahpadu Properties Sdn
Bhd [1995] 1 LNS 110

Legislation referred to:-

Rules of the High Court 1980, O. 14

Sale of Goods Act 1957, s. 31