Gan Jin Sim @ Gan Gim Sim

[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 1

GAN JIN SIM @ GAN GIM SIM

v.
GAN CHON TAT & ANOR

Court Of Appeal, Putrajaya

Idrus Harun, Nallini Pathmanathan, Zabariah Mohd Yusof JJCA
[Civil Appeal No: D-02(NCVC)(A)-897-05/2016]
26 January 2017

Case(s) referred to:

Asia Commercial Finance (M) Berhad v. Kawal Teliti Sdn Bhd [1995] 1 MLRA
611; [1995] 3 MLJ 189; [1995] 3 CLJ 783; [1995] 3 AMR 2559 (refd)
Badiaddin Mohd Mahidin & Anor v. Arab Malaysian Finance Berhad [1998] 1
MLRA 183; [1998] 1 MLJ 393; [1998] 2 CLJ 75; [1998] 1 AMR 909 (refd)
CIMB Bank Berhad v. Maybank Trustees & Other Appeals [2014] 4 MLRA 677;
[2014] 3 MLJ 169; [2014] 3 CLJ 1; [2014] 4 AMR 229 (refd)
Elliston v. Glencore Services (UK) Ltd [2016] EWC CIV 407 (refd)
Fage UK Ltd v. Chobani UK Ltd [2014] EWCA Civ 5 [2014] ETMR 26 (refd)
Gan Yook Chin v. Lee Ing Chin [2004] 2 MLRA 1; [2005] 2 MLJ 1; [2004] 4 CLJ
309; [2004] 6 AMR 781 (refd)
Greenhalgh v. Mallard [1947] 2 All ER 255 (refd)
Henderson v. Henderson [1843] 3 Hare 100 (refd)
Hock Hua Bank Bhd v. Sahari Murid [1980] 1 MLRA 687; [1981] 1 MLJ 143
(refd)
Huawei Tech Investment Co Ltd v. Transition Systems (M) Sdn Bhd [2014] 1
MLRA 148; [2013] 5 MLJ 396 (refd)
Joseph Paulus Lantip & Ors v. Unilever PLC [2012] 6 MLRA 614; [2012] 7 CLJ
693 (refd)
Kok Hoong v. Leong Cheong Kweng Mines Ltd [1963] 1 MLRA 343; [1964] MLJ
49 (refd)
M Nagabhushana v. State Of Karnataka & Ors [Civil Appeal No. 1215-2011]
(refd)
Manoharan Malayalam v. Menteri Dalam Negeri, Malaysia & Anor [2009] 1
MLRA 81; [2009] 2 CLJ 839 (refd)
OCBC Bank (Malaysia) Bhd v. Kredin Sdn Bhd [1997] 1 MLRA 84; [1997] 2 MLJ
544; [1997] 2 CLJ 534 (refd)
Puah Bee Hong @ Bee Hong (F) & Anor v. Pentadbir Tanah Daerah Wilayah
Persekutuan Kuala Lumpur & Anor (Robert Teo Keng Tuan, Intervener) &
Another Case [1994] 1 MLRA 168; [1994] 2 MLJ 601; [1994] 2 CLJ 705; [1994] 2
AMR 1427 (refd)
Serac Asia Sdn Bhd v. Sepakat Brokers Sdn Bhd [2013] 5 MLRA 175; [2013] 5
MLJ 1; [2013] 6 CLJ 673; [2013] 4 AMR 385 (refd)
Syed Mohd Salie Labbai (Dead) by LRs and Ors v. Mohd Hanifa (Dead) by LRs
and Ors [1976] 4 SCC 780 (refd)
Thomas v. Thomas [1947] AC 484 (refd)
Tindok Besar Estate Sdn Bhd v. Tinjar Co [1979] 1 MLRA 81; [1979] 2 MLJ 229
 Gan Jin Sim @ Gan Gim Sim
pg 2 v. Gan Chon Tat & Anor [2017] MLRAU 269

(refd)
UEM Group Bhd v. Genisys Integrated Engineers Pte Ltd & Anor [2010] 2
MLRA 668; [2010] 9 CLJ 785 (refd)
United Kingdom, In re B (A Child) (Care Proceedings: Threshold Criteria) [2013]
1 WLR 1911 (refd)
Watson Farley and Wiliams v. Ostrovizky [2015] EWCA Civ 457 (refd)
Woodsville Sdn Bhd v. Tien Ik Enterprise Sdn Bhd & Other Appeals [2004] 2
MLRA 657; [2005] 2 CLJ 853 (refd)
Yuill v. Yuill [1945] P 15 (refd)

Legislation referred to:

Courts of Judicature Act 1964, s 25(2)
Limitation Act 1953, s 6(3)
Rules of Court 2012, O 15 r 6(1)

Counsel:
For the appellant: Wee Choo Keong (Wee Choo Chin and William Siau with
him); M/s CC Wee & Co
For the respondent: Shaharuddin Hidayu (Marwaliz Mahmud with him); M/s
Shaharuddin Hidayu & Marwaliz

[Allowed the appeal.]

Case Progression:
High Court: [2017] MLRHU 982
High Court: [2016] MLRHU 1617

JUDGMENT

Nallini Pathmanathan JCA:

Introduction

[1] The appeal before us stems from a dispute over the estate of one Gan Lai
Kim, and is between the appellant Gan Jin Sim @ Gan Gim Sim who is the
daughter and administrator of the estate of Gan Lai Kim on the one hand, and
the administrators of the estate of Gan Soon Cheow, her late brother on the
other. They are the respondents in this appeal. Gan Lai Kim and Gan Soon
Cheow are father and son respectively. Accordingly, Gan Jin Sim and Gan
Soon Cheow, deceased, were sister and brother respectively. The respondents
are the son and wife respectively of Gan Soon Cheow.

[2] The primary ground of appeal revolves around the issue of res judicata.
Specifically, the issue for consideration before us was whether a judgment in
default of appearance obtained in the High Court, which was neither set aside
nor taken up on appeal, can be relitigated on its merits in another High Court
of coordinate jurisdiction in a different set of proceedings, the end result of
which was to effectively set aside the earlier judgment of the original High
Court.
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 3

[3] The appellant's appeal is premised on the ground that the High Court was
wrong in dismissing the appellant's claim for a property which a different High
Court judge included in an order to be returned to the appellant's late father's
estate. The appellant contended that the High Court was functus officio in
altering the extent of the earlier court order and that because the defendants
did not appeal against the earlier court order, the matter was now res judicata.

[4] We allowed the appeal and append the reasons for our decision below. The
salient facts and the relationship between the parties are also set out below.
The parties will be referred to as they were in the High Court for ease of
reference.

The Parties

[5] Gan Lai Kim, deceased, passed away without a will on 23 December 1971
('the deceased father, Gan Lai Kim').

[6] The deceased father, Gan Lai Kim, passed away intestate. His wife, Lim
Poh Le, passed away on 10 May 1996.

[7] The deceased father, Gan Lai Kim, had two children, namely a daughter,
the plaintiff, Gan Jin Sim @ Gan Gim Sim, and her brother, Gan Soon
Cheow, who passed away on 8 March 1977 ('the deceased, Gan Soon
Cheow').

[8] Gan Jin Sim @ Gan Gim Sim is the current administrator of the deceased
father's estate vide a KL High Court order dated 16 October 2012 and a letter
of administration issued by the KL High Court on 31 January 2013 ('the
plaintiff'). She is the appellant before us and the plaintiff in the court below.

[9] Gan Chon Tat, the 1st defendant, is the son of Gan Soon Cheow, and he is
the plaintiff's nephew ('the 1st defendant').

[10] Aong Chai Ngaa, the 2nd defendant, is the wife of the deceased, Gan
Soon Cheow. She is the mother of the 1st defendant and is the plaintiff's sister-
in-law ('the 2nd defendant').

[11] Both defendants are the respondents before us. They were sued as the
joint administrators of the estate of the deceased, Gan Soon Cheow.

Salient Facts

[12] The deceased father, Gan Lai Kim, owned three properties which are all
situated in Seksyen 1, Bandar Kota Bharu, Kelantan Darul Naim.

[13] The land at the centre of the present dispute is held under Grant No. 5477
and is known as PN 889, Lot No. 17, Seksyen 1, Bandar Kota Bharu,
Kelantan Darul Naim, held under Geran No. 5447 ('Lot 17'). The other two
properties are Lot 19 held under Grant No. 5479 and Lot No. 29 held under
 Gan Jin Sim @ Gan Gim Sim
pg 4 v. Gan Chon Tat & Anor [2017] MLRAU 269

Grant No. 5524. Collectively, these will be referred to as 'the three pieces of
land'.

[14] After the demise of the deceased father, Gan Lai Kim, without a will,
Gan Soon Chew obtained a distribution order dated 23 June 1973 and a letter
of administration dated 2 July 1973. However, the plaintiff applied to the Kota
Bharu High Court in Suit No. 53 of 1981 ('Suit No. 53') to set aside both the
distribution order and the letter of administration. The plaintiff complained
that her brother had fraudulently transferred the said three pieces of land to
himself by failing to disclose the existence of the plaintiff when he applied for
the distribution order and the letters of administration.

[15] Nearly 30 years after the filing of the plaintiff's action, on 30 October
2001, the Kota Bharu High Court recorded a judgment in default of
appearance of the defendants in Suit No. 53. The High Court allowed the
plaintiff's application ('the 2001 order') and set aside:

(a) the letters of administration dated 2 July 1973;

(b) and the distribution order dated 23 June 1973 obtained by Gan
Soon Chew distributing solely to himself the said three pieces of land.

The court granted consequential orders that the three pieces of land, ie
Lot 17, Lot 19 and Lot 29, were to be returned to the deceased's estate.

[16] By the date of the 2001 order, Gan Soon Chew had passed away. The
administrators of his estate, his son and wife, the defendants here, did not
appeal against the 2001 order and did not apply to set it aside.

[17] As the defendants did not appeal nor set aside the 2001 order, it effectively
became a final and binding order of the High Court notwithstanding that it
was a default judgment. However, the defendants did not, or were unable to
comply with the 2001 order insofar as it compelled a delivery up of Lot 17.
This was because Lot 17 had been surrended to the State Government of
Kelantan and had subsequently been sold to a third party. The third party was
not privy to these proceedings. As a consequence, the present proceedings in
the High Court were effectively in the nature of consequential or execution
proceedings to enforce the 2001 order in relation to Lot 17. However, it is
pertinent and significant to note that the plaintiff was prepared to accept
damages in lieu of the actual return of Lot 17.

[18] The plaintiff filed the present action against the defendants alleging that
the defendants had breached the 2001 order, because Lot 17 had not been
returned to the deceased's estate. The plaintiff sought orders, inter alia, that the
defendants return Lot 17 or pay damages for the loss of Lot 17 to be assessed
at the market rate at the time the 2001 order was obtained. The plaintiff
contended that Lot 17 had been sold fraudulently by her brother to a third
party and therefore, she was entitled to damages.

[19] This matter was initially filed as an originating summons in the KL High
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 5

Court. On 25 July 2013, it was transferred to the Kota Bharu High Court. On
25 February 2014, it was converted to a writ action and a full trial was held.

[20] The defendants contested the plaintiff's claim. They contended that only
two pieces of land, ie Lot 19 and Lot 29, could be returned to the estate and
indeed had already been returned by them in compliance with the 2001 order.
Lot 17 could not be returned because it had been disposed of by Gan Soon
Cheow before his demise, and therefore the defendants no longer had control
over it. The defendants also raised the issue of laches because the plaintiff only
applied for the letters of administration for the deceased's estate in 2012.

[21] On 19 August 2015, in her submissions before the High Court, the
plaintiff withdrew her claims for assessment of rental, profits, trespass, and
injunction. Both parties agreed to proceed only with the claim for the return of
Lot 17.

[22] The High Court dismissed the plaintiff's claim, finding that she had failed
to prove her claim on a balance of probabilities. Dissatisfied, the plaintiff
appealed.

Findings Of The High Court

[23] In brief, the learned Judicial Commissioner held that Lot 17 had been
disposed of by Gan Soon Cheow in 1976 before his death, and had been
properly registered in the name of the third party purchaser. The defendants
therefore cannot be said to have defied the order. It was impossible for the
defendants to return Lot 17 because the original issue document of title had
never been in their possession. The defendants should not be imposed with
liability for the actions carried out by Gan Soon Cheow while he was still
alive.

[24] The learned Judicial Commissioner noted that the plaintiff obtained the
2001 order through a judgment in default. Therefore, it is possible that the
court at that time was not made aware of the fact that Lot 17 had never been
in the possession of the defendants, as Lot 17 was not part of the estate of Gan
Soon Cheow.

[25] The learned Judicial Commissioner stated that the plaintiff should have
named the current owner of Lot 17 as a party in this action if the plaintiff
intended to challenge the transfer and ownership of Lot 17, which would
certainly affect the property rights of a third party. Without doing so, it was
held that the 2001 order remained a paper judgment.

[26] The learned Judicial Commissioner found that from the evidence of the
plaintiff herself, Lot 17 was disposed of by Gan Soon Cheow by returning the
land to the State of Kelantan. There was no evidence of Gan Soon Cheow
having received any benefit or profit from the return of the land to the state
government. When Lot 17 was disposed of by Gan Soon Cheow, the plaintiff
had knowledge of the disposal but did not raise any objection. Therefore the
plaintiff was estopped from disputing the disposal of Lot 17 at this late stage.
 Gan Jin Sim @ Gan Gim Sim
pg 6 v. Gan Chon Tat & Anor [2017] MLRAU 269

Submissions Before The Court Of Appeal

Plaintiff's Submissions

[27] Counsel for the plaintiff (the appellant before us) argued that since the
2001 order was not set aside nor appealed against, it had to be obeyed. The
doctrine of res judicata was applicable to prevent the learned Judicial
Commissioner from allowing the relitigation of the same issues which had
been adjudged in Suit No. 53, culminating in a final judgment, ie the 2001
order. Even a judgment in default should be complied with. Further, the 2001
order is incontestable proof of fraud committed by the deceased, Gan Soon
Cheow.

[28] The plaintiff's counsel submitted that the learned Judicial Commissioner
had erred in finding that the defendants (the respondents before us) were not
liable for the acts of Gan Soon Cheow. It was never the plaintiff's case that the
defendants were the persons who disposed of Lot 17. The defendants were
sued in their capacity as the legal representatives of the estate of Gan Soon
Cheow, not in their personal capacity. It is trite law that a deceased may only
be sued through his estate.

[29] The plaintiff's counsel contended that it was speculation on the part of the
Judicial Commissioner to say that it was a possibility that the court in making
the 2001 order was not advised of the fact that Lot 17 had been disposed of
and could not be returned.

[30] Further, learned counsel for the plaintiff submitted that the learned
Judicial Commissioner had erred in deciding that the 2001 order was useless
as the current registered owner of Lot 17 was not a party to that suit, by reason
of O 15 r 6(1) of the Rules of Court (RC) 2012. Essentially his contention was
that the non-joinder of a party would not defeat a valid cause of action.
Moreover, the plaintiff was satisfied with a claim in damages in lieu of the
return of Lot 17.

[31] Finally, the plaintiff also made claim for the losses suffered by her due to
the delay in returning Lot 17 to the deceased's estate. This relief was not
granted.

Defendants' Submissions

[32] For the defendants, it was submitted that Lot 17 could not be returned to
the deceased's estate as it had been returned to the Kelantan State Government
by Gan Soon Cheow on 28 December 1976 and no compensation was given.
On 29 December 1976, Lot 17 was registered in the name of one Pek Yang @
Tan Guat Cheen. Since it was not in the possession of the defendants, they
cannot be said to have contravened the 2001 order. It was unfair to penalise
the defendants for the actions of Gan Soon Cheow while he was alive. The
defendants had complied with the 2001 order to the extent possible, ie by
returning Lot 19 and Lot 29 to the deceased's estate, but it was impossible for
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 7

them to return Lot 17 which was not listed as an asset in Gan Soon Cheow's
estate.

[33] Besides that, the defendants' counsel raised the issue of delay on the
plaintiff's part as evidence of her mala fides. He alleged that due to the delay of
more than 11 years since the issuance of the 2001 order in taking this action,
the value of Lot 17 had gone up and the profit in returning Lot 17 to the
plaintiff now would be inequitable. Alternatively, should the court grant the
plaintiff damages for the loss of Lot 17, the sum awarded should be only for
the value of the land and not the house which had been erected upon Lot 17.
The defendants' counsel also pointed out the difference in the two valuations
produced by the same valuer in the span of 1 year, and argued that the valuer,
one Yaacob Ishak, was unreliable and another valuer should be appointed.

[34] The defendants' counsel argued that res judicata was not applicable in this
case because the 2001 order was a judgment in default of appearance of the
respondents and their counsel, meaning that the relevant evidence and issues
were not ventilated at a full trial.

[35] By way of reply, the plaintiff's counsel denied the allegation of delay,
stating that the cause of action accrued from the date of the 2001 order, ie 31
October 2001. This action was filed on 11 March 2013, within the 12 year
limitation period stipulated in s 6(3) of the Limitation Act 1953.

[36] With regard to the issue of the difference in the valuation of Lot 17, the
plaintiff's counsel justified it by stating that the house on the said Lot 17 had
been renovated by the new owner.

Principles Of Appellate Intervention

[37] In determining this appeal, we were mindful of the principles of appellate

intervention. The Court of Appeal will only very rarely reverse a trial judge's
findings of primary fact and then only if it is satisfied that the trial judge was
plainly wrong (see for example Tindok Besar Estate Sdn Bhd v. Tinjar Co
[1979] 1 MLRA 81; [1979] 2 MLJ 229, Gan Yook Chin v. Lee Ing Chin [2004]
2 MLRA 1; [2005] 2 MLJ 1; [2004] 4 CLJ 309; [2004] 6 AMR 781, UEM
Group Bhd v. Genisys Integrated Engineers Pte Ltd & Anor [2010] 2 MLRA 668;
[2010] 9 CLJ 785, the old English cases of Yuill v. Yuill [1945] P 15, 19 per
Lord Greene MR and Thomas v. Thomas [1947] AC 484 per Lord Thankerton,
and more recently in the United Kingdom, In re B (A Child) (Care Proceedings:
Threshold Criteria) [2013] 1 WLR 1911, Fage UK Ltd v. Chobani UK Ltd
[2014] EWCA Civ 5 [2014] ETMR 26, Watson Farley and Wiliams v.
Ostrovizky [2015] EWCA Civ 457, and Elliston v. Glencore Services (UK) Ltd
[2016] EWC CIV 407).

Decision Of The Court Of Appeal

[38] Having perused the appeal records and after hearing the submissions of
learned counsel, we found that there were merits in the appeal. We set out our
full grounds below.
 Gan Jin Sim @ Gan Gim Sim
pg 8 v. Gan Chon Tat & Anor [2017] MLRAU 269

[39] The first issue to be considered was the plaintiff's argument that the High
Court had erred by relitigating the 2001 order and contravening the doctrine of
res judicata. If we find that the plaintiff is entitled to invoke and rely on the
doctrine of res judicata, then it is clear that the High Court had no jurisdiction
to make the order which it did and the appeal ought to be allowed on that
ground alone.

The Law On Res Judicata

[40] The common law doctrine of res judicata is incorporated into Malaysian
law by virtue of the statutory provisions of s 25(2) of the Courts of Judicature
Act 1964. The Schedule to that section confers additional powers to the High
Court more specifically in item 11 which provides as follows:

"11. Power to dismiss or stay proceedings where the matter in question

is res judicata between the parties, or by reason of multiplicity of
proceedings in any Court or Courts the proceedings ought not to be
continued."

[41] The decision of the Federal Court of Malaysia in Serac Asia Sdn Bhd v.
Sepakat Brokers Sdn Bhd [2013] 5 MLRA 175; [2013] 5 MLJ 1; [2013] 6 CLJ
673; [2013] 4 AMR 385 sets out the rationale for the application of res judicata
thus:

[42]

"In our judgment too, the re-litigation of a regularly and properly

conducted matter as determined by the court is prohibited by the wide
doctrine of res judicata. The judicial process rests on the twin pillars of
certainty and finality. A final order or a judgment must therefore be
vigorously protected by this doctrine, a position taken by the common
law courts ever since Henderson (1843)." (emphasis added)

[43] In Henderson v. Henderson [1843] 3 Hare 100, Wigram VC in the Court of

Chancery explained the wider ambit and application of res judicata at p 115 as
follows:

"The plea of res judicata applies, except in special cases, not only to
points upon which the Court was actually required by the parties to
form an opinion and pronounce a judgment, but to every point which
properly belonged to the same subject of litigation and which the
parties, exercising reasonable diligence, might have brought forward at
the time."

[44] And in Greenhalgh v. Mallard [1947] 2 All ER 255, Somervell LJ further

explained in the English Court of Appeal, at p 257:

"... res judicata for this purpose is not confined to the issues which the
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 9

Court is actually asked to decide, but... it covers issues or facts which

are so clearly part of the subject matter of the litigation and so clearly
could have been raised that it would be an abuse of the process of the
Court to allow a new proceedings to be started in respect of them."

[45] These definitions were adopted in the celebrated case of Asia Commercial
Finance (M) Berhad v. Kawal Teliti Sdn Bhd [1995] 1 MLRA 611; [1995] 3 MLJ
189; [1995] 3 CLJ 783; [1995] 3 AMR 2559 by Peh Swee Chin SCJ in the
Supreme Court, now arguably the most often cited definition of res judicata in
the Malaysian courts:

"What is res judicata ? It simply means a matter adjudged, and its

significance lies in its effect of creating an estoppel per rem judicature.
When a matter between two parties has been adjudicated by a Court
of competent jurisdiction, the parties and their privies are not
permitted to litigate once more the res judicata, because the judgment
becomes the truth between such parties, or in other words, the parties
should accept it as the truth; res judicata pro veritate accipitur. The
public policy of the law is that it is in the public interest that there
should be finality in litigation - interest rei publicae ut sit finis litium. It
is only just that no one ought to be vexed twice for the same cause of
action - nemo debet bis vexari pro eadem causa. Both maxims are the
rationales for the doctrine of res judicata, but the earlier maxim has the
further elevated status of a question of public policy.

Since a res judicata creates an estoppel per rem judicatum, the doctrine
of res judicata is really the doctrine of estoppel per rem judicatum, the
latter being described sometimes in a rather archaic way as estoppel by
record. Since the two doctrines are the same, it is no longer of any
practical importance to say that res judicata is a rule of procedure and
that an estoppel per rem judicatum is that of evidence. Such dichotomy
is apt to give rise to confusion.

....................................................................................

Thus, there are in fact two kinds of estoppel per rem judicatum. The
first type relates to cause of action estoppel and the second, to issue
estoppel, which is a development from the first type.

The cause of action estoppel arises when rights or liabilities involving

a particular right to take a particular action in Court for a particular
remedy are determined in a final judgment and such right of action ie
the cause of action, merges into the said final judgment; in layman's
language, the cause of action has turned into the said final judgment.
The said cause of action may not be re-litigated between the same
parties because it is res judicata.

In order to prevent multiplicity of actions and also in order to protect

the underlying rationales of estoppel per rem judicatum and not to act
against them, such estoppel of cause of action has been extended to all
 Gan Jin Sim @ Gan Gim Sim
pg 10 v. Gan Chon Tat & Anor [2017] MLRAU 269

other causes of action (based on the same facts or issues) which should
have been litigated or asserted in the original earlier action resulting in
the final judgment and which were not either deliberately or due to
inadvertence.

.....................................................................................

On the other hand, issue estoppel literally means simply an issue

which a party is estopped from raising in a subsequent proceeding.
However, the issue estoppel, in a nutshell, from a consideration of
case law, means in law a lot more ie that neither of the same parties or
their privies in a subsequent proceeding is entitled to challenge the
correctness of the decision of a previous final judgment in which they,
or their privies, were parties. This sounds like explaining a truism, but
it is the corollary from that statement that is all important and that
could have given birth to the controversies alluded to above; the
corollary being that neither of such parties will be allowed to adduce
evidence or advance any argument to contradict such
decision..................

...................................................................................

There is one school of thought that issue estoppel applies only to

issues actually decided by the Court in the previous proceedings and
not to issues which might have been and which were not brought
forward, either deliberately or due to negligence or inadvertence, while
another school of thought holds the contrary view that such issues
which might have been and which were not brought forward as
described, though not actually decided by the Court, are still covered
by the doctrine of res judicata ie. doctrine of estoppel per rem
judicatum.

We are of the opinion that the aforesaid contrary view is to be

preferred; it represents for one thing, a correct even though broader
approach to the scope of issue estoppel. It is warranted by the weight
of authorities to be illustrated later. It is completely in accord or
resonant with the rationales behind the doctrine of res judicata, in
other words, with the doctrine of estoppel per rem judicatum. It is
particularly important to bear in mind the question of the public policy
that there should be finality in litigation in conjunction with the
exploding population; the increasing sophistication of the populace
with the law and with the expanding resources of the Courts being
found always one step behind the resulting increase in litigation."

[46] In the Federal Court case of Manoharan Malayalam v. Menteri Dalam

Negeri, Malaysia & Anor [2009] 1 MLRA 81; [2009] 2 CLJ 839, Zulkefli
Makinudin FCJ stated as follows:

"The common law doctrine of res judicata has been incorporated into
the statute law in Malaysia as can be found in s 25(2) of the Courts of
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 11

Judicature Act 1964 ["CJA"] which confers additional powers to the

High Court as set out in item 11 of the schedule to the CJA as follows:

"11. Power to dismiss or stay proceedings where the matter in

question is res judicata between the parties, or by reason of
multiplicity of proceedings in any Court or Courts the
proceedings ought not to be continued."

.....................................

.....It is our judgment that the inclusion of the common law doctrine of
res judicata in item 11 of the Schedule under s 25(2) of the CJA
reflects the intention of our legislators in formulating a policy to
address the issue of multiplicity or overlapping of legal proceedings."

[47] Malaysian cases such as Puah Bee Hong @ Bee Hong (F) & Anor v.
Pentadbir Tanah Daerah Wilayah Persekutuan Kuala Lumpur & Anor (Robert
Teo Keng Tuan, Intervener) & Another Case [1994] 1 MLRA 168; [1994] 2 MLJ
601; [1994] 2 CLJ 705; [1994] 2 AMR 1427 and Badiaddin Mohd Mahidin &
Anor v. Arab Malaysian Finance Berhad [1998] 1 MLRA 183; [1998] 1 MLJ
393; [1998] 2 CLJ 75; [1998] 1 AMR 909 have applied the doctrine of res
judicata. The latter case also referred to Hock Hua Bank Bhd v. Sahari Murid
[1980] 1 MLRA 687; [1981] 1 MLJ 143 on the concept of functus officio.

[48] The scope of the doctrine of res judicata is wide enough to cover every
point which properly belonged to the same subject of litigation and should
have been raised in the earlier case (see Malaysian cases of Huawei Tech
Investment Co Ltd v. Transition Systems (M) Sdn Bhd [2014] 1 MLRA 148;
[2013] 5 MLJ 396 and OCBC Bank (Malaysia) Bhd v. Kredin Sdn Bhd [1997] 1
MLRA 84; [1997] 2 MLJ 544; [1997] 2 CLJ 534 (both Court of Appeal cases)
as well as the Federal Court cases of Serac Asia Sdn Bhd v. Sepakat Brokers Sdn
Bhd (above), CIMB Bank Berhad v. Maybank Trustees & Other Appeals [2014] 4
MLRA 677; [2014] 3 MLJ 169; [2014] 3 CLJ 1; [2014] 4 AMR 229,
Woodsville Sdn Bhd v. Tien Ik Enterprise Sdn Bhd & Other Appeals [2004] 2
MLRA 657; [2005] 2 CLJ 853, and Joseph Paulus Lantip & Ors v. Unilever PLC
[2012] 6 MLRA 614; [2012] 7 CLJ 693.)

[49] In the Federal Court case of Manoharan Malayalam (above), the court
recognised that there would be exceptional circumstances where res judicata
would not apply, as stated in the passage below:

"...... we do recognize the fact that there would be exceptional cases

where matters which should have been raised were not, but when
raised in subsequent proceedings would not amount to an abuse of
process and the plea of res judicata does not appear to be correctly
taken [See the case of Re Tarling [1979] 1 All ER 981]. This point was
considered in our local case of Rakesh Ram Tawar v. Timbalan Menteri
Keselamatan Dalam Negeri, Malaysia & Ors [2008] 1 MLRH 591;
[2008] 4 MLJ 97; [2008] 4 CLJ 297. ....................."
 Gan Jin Sim @ Gan Gim Sim
pg 12 v. Gan Chon Tat & Anor [2017] MLRAU 269

[50] On the facts of our present case, there are no special circumstances to
preclude the argument of the doctrine of res judicata. Unlike Rakesh's case
(above), the liberty of the person is not at stake. In Rakesh's case (above) which
involved a habeas corpus application, the High Court held that the fact that
the applicant's solicitors were not apprised of the current legal position could
not be attributed to the applicant and therefore he cannot be said to have held
back legal arguments for use in a subsequent application. The High Court
emphasised that since the liberty of the applicant was in issue, it deserved
careful consideration. On the other hand, the position in Manoharan's case
(above) was different. The Federal Court held that the High Court in Rakesh's
case came to the correct conclusion, but decided that the doctrine of res
judicata would apply. In the latter case, the Federal Court noted that the
appellant had filed three successive applications for a writ of habeas
application in respect of the same detention order and therefore res judicata
arose.

The English Position

[51] George Spencer Bower and Sir Alexander Kingcome Turner in the
introduction to the textbook 'Res Judicata', summed up this doctrine in a single
line:

"In English jurisprudence a res judicata, that is to say a final judicial

decision pronounced by a judicial tribunal having competent
jurisdiction over the cause or matter in litigation, and over the parties
thereto, disposes once and for all of the matters decided, so that they
cannot afterwards be raised for re-litigation between the same parties
or their privies."

[52] And further on, Spencer Bower states at p 42:

"A judgment or order by default is prima facie just as much a judicial

decision in favour of the plaintiff as any other judgment or order,
whether the default of the defendant was in appearance to the writ, or
in pleading, or in appearance at the trial or hearing, or in prosecution
of, or resistance to, an appeal. ...........

.... questions of the utmost importance may arise as to the precise issue
or matter of fact or law (if any) which by express declaration or
necessary implication, a default judgment or order has determined.
Such a judgment or order will certainly found an estoppel as to
something; but the question is what it is to be taken as concluding, and
for what conclusions it is to stand....."

[53] At p 48 of the same text, Spencer Bower concluded "But if the identical
question arising in the second action actually arose in the first, and has been or
must necessarily be deemed to have been decided with complete precision one
way or the other as the foundation of the default judgment signed by the
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 13

plaintiff, then, at least while the judgment stands, that question is concluded
between the parties."

[54] See also Henderson v. Henderson and Greenhalgh v. Mallard, referred to

above.

The Indian Position

[55] The Indian case of M Nagabhushana v. State Of Karnataka & Ors, Civil
Appeal No. 1215 of 2011 heard on 2 February, 2011 relates to land, as is the
case here. It was an appeal from the Division Bench of the High Court of
Karnataka's decision to dismiss an appeal and affirm the decision of the Single
Judge to dismiss the aggrieved person's action which was filed to impugn an
acquisition of land by the state. While dismissing the action, the Single Judge
had found that the acquisition proceedings in question had been already
challenged in a previous action which initially quashed the acquisition
proceedings. On appeal, the Division Bench reversed the judgment of the
learned Single Judge. Finally, the Supreme Court of India upheld the decision
of the Division Bench and approved the acquisition proceedings.

[56] Returning to the case of M Nagabhushana (above), the Supreme Court of

India dismissed the aggrieved person's appeal on the ground that to relitigate
the matter would amount to an abuse of process. Ganguly J based his decision
on the principles of res judicata which he elucidated as follows:

"14. The principles of Res Judicata are of universal application as it is

based on two age old principles, namely, 'interest reipublicae ut sit finis
litium' which means that it is in the interest of the State that there
should be an end to litigation and the other principle is 'nemo debet his
ve ari, si constet curiae quod sit pro un aet eademn cause ' meaning
thereby that no one ought to be vexed twice in a litigation if it appears
to the Court that it is for one and the same cause. This doctrine of Res
Judicata is common to all civilized system of jurisprudence to the
extent that a judgment after a proper trial by a Court of competent
jurisdiction should be regarded as final and conclusive determination
of the questions litigated and should for ever set the controversy at
rest.

15. That principle of finality of litigation is based on high principle of

public policy. In the absence of such a principle great oppression might
result under the colour and pretence of law in as much as there will be
no end of litigation and a rich and malicious litigant will succeed in
infinitely vexing his opponent by repetitive suits and actions. This may
compel the weaker party to relinquish his right. The doctrine of Res
Judicata has been evolved to prevent such an anarchy. That is why it is
perceived that the plea of Res Judicata is not a technical doctrine but a
fundamental principle which sustains the Rule of Law in ensuring
finality in litigation. This principle seeks to promote honesty and a fair
administration of justice and to prevent abuse in the matter of
accessing Court for agitating on issues which has become final
 Gan Jin Sim @ Gan Gim Sim
pg 14 v. Gan Chon Tat & Anor [2017] MLRAU 269

between the parties."

(emphasis ours)

[57] Ganguly J in tracing the origins of res judicata also noted that this doctrine
could be found in Hindu jurisprudence, Muhammadan law and Roman
jurisprudence. Therefore it may be seen that this doctrine is one which has
existed for a long time with good reason, due to the importance of maintaining
finality in litigation.

[58] The case of M Nagabhushana (above) was referred to in the High Court
case of Union Of India vs Videocon Industries Ltd. heard on 5 March, 2012.
In the High Court of Delhi, Reva Khetrapal J referred to an old Indian
Supreme Court case, Syed Mohd Salie Labbai (Dead) by LRs and Ors vs. Mohd
Hanifa (Dead) by LRs and Ors [1976] 4 SCC 780. In Syed's case (above), the
Supreme Court laid down four conditions to be fulfilled before a plea of res
judicata can be given effect:

(1) that the litigating parties must be the same;

(2) that the subject-matter of the suit also must be identical;

(3) that the matter must be finally decided between the parties; and

(4) that the suit must be decided by a court of competent jurisdiction.

[59] Applying this elucidation of the doctrine to the facts of the present case,
we considered whether Lot 17, which was the subject matter of the present
case, was also the subject matter of the earlier case which led to the 2001
order. We find that it was one of the matters determined by the 2001 order,
because in the earlier case, the plaintiff sought the return of the said three
pieces of land, which included Lot 17. Therefore the question being litigated in
the present action, ie whether Lot 17 should belong to the estate of Gan Soon
Cheow or the deceased's estate, had also been an issue which was determined
in the previous suit, albeit by default.

[60] In the instant case, the defendants took the defence that the privies, ie the
administrators of the estate of Gan Soon Cheow, were not bound by the
actions of the deceased, Gan Soon Cheow, and that they were entitled to
effectively re-open the merits of the 2001 order, in subsequent consequential
proceedings. In such an instance applying the law as set out above, it would
appear that any such attempt would flout both the cause of action aspect of res
judicata as well as issue estoppel, as pronounced by Peh Swee Chin SCJ in
Kawal Teliti (above).

[61] We concur with learned counsel for the appellant that the defendants'
attempt to remove Lot 17 from the scope of the 2001 order, amounted to
relitigating a decision which had become final because it was neither set aside,
nor appealed against.
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 15

[62] We also agreed that the learned Judicial Commissioner erred in opening
up the 2001 order to re-litigation and in varying the prayers granted.

[63] Another exception to the application of the doctrine of res judicata is

evident in the case of Kok Hoong v. Leong Cheong Kweng Mines Ltd [1963] 1
MLRA 343; [1964] MLJ 49. In that case, Viscount Radcliffe delivering the
judgment of the Privy Council stated that an estoppel arising from a judgment
in default should be restricted and the principles enunciated in the case of
Henderson v. Henderson (above) should not be applied rigorously.

[64] However, the case of Kok Hoong is distinguishable from the present facts
as in that case, res judicata was held to not exclude a plea based upon statute.
In Kok Hoong's case, a judgment was obtained by reason of the respondent's
default of appearance in a suit filed by the appellant claiming, inter alia, the
recovery of monies by virtue of an agreement hiring out machinery and
equipment to the respondent. The respondent did not fulfil monthly payments,
and wrongfully detained the machinery and equipment. In another action filed
by the appellant based upon a subsequent similar agreement, the respondent
pleaded in its defence that the transactions between the appellant and
respondent were in reality not hiring agreements but were a form of borrowing
money on the security of goods. The Privy Council held that res judicata
cannot apply so strictly to those facts to bar the respondent from raising its
defence, and res judicata cannot bar a plea based on statute. The legislation
relied upon by the respondent in Kok Hoong's case were the Moneylenders
Ordinance and the Bills of Sale Ordinance which would render the disguised
moneylending transactions void. In our present case, there is no statute relied
upon by the defendants which would warrant the application of the principle
laid down by the Privy Council in Kok Hoong's case. Neither does this suit
arise from a "subsequent similar agreement". This suit was filed to procure the
necessary consequential prayers arising from the 2001 suit.

[65] Even if we are incorrect in concluding that the 2001 order is caught by the
doctrine of res judicata, we are of the view that based on the merits of the
defendants' case as argued before us, we would have arrived at the same
conclusion. The fact remains that it is not in dispute that the deceased, Gan
Soon Cheow, acted wrongfully in fraudulently or illegally transferring to
himself or for his benefit, the properties belonging to the estate of his deceased
father, Gan Lai Kim. This included Lot 17. As such the fact that the
administrators had not participated in this wrongdoing, did not mean that Lot
17 could remain a part of the estate of the deceased, Gan Soon Cheow. It is
trite that the plaintiff's claim could be asserted against the estate of the
deceased, Gan Soon Cheow.

[66] The phrase "at least while the judgment still stands" emphasised in the
earlier passage from Spencer Bower's textbook is an important qualification. It
is not disputed that the defendants did not appeal against or apply to set aside
the judgment in default obtained by the plaintiff against them. By choosing to
remain silent and not disputing the listing of Lot 17 in the 2001 order as one of
the properties to be returned to the deceased's estate, the 2001 order became
final and binding upon the defendants. They are therefore barred by res
 Gan Jin Sim @ Gan Gim Sim
pg 16 v. Gan Chon Tat & Anor [2017] MLRAU 269

judicata from seeking to remove Lot 17 from the ambit of the judgment.

[67] Further, the court below was functus officio and should not therefore have
sought to alter the 2001 order. The learned JC in the court below, in our view,
with respect, erred. Hence we allowed the appeal.

[68] We now go on to consider the ancillary issues raised in submissions

before us.

Ancillary Issues

[69] As pointed out earlier, the learned Judicial Commissioner held that the
2001 order was ineffective by reason of the current owner of Lot 17 not being a
party to the suit. However in so concluding, the learned Judicial
Commissioner failed to consider that the plaintiff was not seeking an order
that the title to Lot 17 was defeasible, as against the third party purchaser and
registered owner of the land. This is not a claim by the administrator of the
estate of the deceased father, Gan Lai Kim, against the third party purchaser
for the ownership of Lot 17. Rather, this is a suit seeking to enforce the 2001
order as against the deceased Gan Soon Cheow by reason of the said deceased
having wrongfully or fraudulently transferred Lot 17 into his name instead of
making it available to the beneficiaries of the estate of the deceased father, Gan
Lai Kim. Again as stated earlier, the plaintiff was content to receive damages
in lieu of the return of Lot 17 which is evident from a perusal of the reliefs
sought. Therefore there was no requirement that the third party purchaser be
made a party to the suit.

[70] Further or in any event, O 15 r 6(1) of the Rules of Court 2012 provides
that a cause or matter is not to be defeated by reason of the non-joinder of any
party. It further provides that the court may determine the issues or questions
in dispute so far as they affect the rights and interests of the parties. To our
minds therefore, the non-joinder of the third party purchaser is a non-issue,
particularly as damages is a sufficient remedy.

Valuation Reports

[71] As alluded to earlier in para 33, learned counsel for the defendants
referred to the difference between the two valuation reports produced by the
same valuer within the span of one year, maintaining that the said valuer,
Yaacob Ishak, PW1 was therefore unreliable.

[72] In his first report dated 2013 (marked D2), a report commissioned by the
defendants, the valuer stated that the land comprising Lot 17 alone was worth
RM98,000-00. However, in a subsequent report one year later, commissioned
by the plaintiff and marked P2, the land was valued at RM180,000-00.
Notwithstanding that learned counsel for the plaintiff took the position that
the disparity between the two valuations was due to the second valuation
incorporating the value of the house as well as the land, we were not
convinced that this sole fact could give rise to such a large disparity. We were
therefore of the view that the most prudent course of action would be to remit
 Gan Jin Sim @ Gan Gim Sim
[2017] MLRAU 269 v. Gan Chon Tat & Anor pg 17

solely the issue of the assessment of damages in relation to Lot 17 to the High
Court for a new valuation to be undertaken by a different valuer.

Conclusion

[73] For the reasons stated above, we allowed the appeal. We set aside the
order of the High Court and allowed the appeal in part. More specifically, we
allowed prayers 30(2)(a) & (b) of the Statement of Claim with costs of
RM25,000 for the proceedings here and below subject to payment of allocatur.
The deposit was refunded to the appellant.

[74] We further ordered, upon specific request by the lawyers, that interest at
5% per annum be granted on the sum awarded by way of damages, to be
calculated from the date of assessment to the date of realization.