Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 -

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Date and Time: Tuesday, 8 August 2023 11:13:00AM MYT Job Number: 203031083 Document (1) 1. Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 Client/Matter: -None- Search Terms: maglin dennis Search Type: Terms and Connectors Narrowed by: Content Type Narrowed by MY Cases -None- | About LexisNexis | Privacy Policy | Terms & Conditions | Copyright © 2023 LexisNexis DATUK SERI MAGLIN DENNIS D’CRUZ & ORS v DATO LY KIM CHEONG AND OTHER CASES CaseAnalysis | [2022] MLJU 3092 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 Malayan Law Journal Unreported HIGH COURT (KUALA LUMPUR) CHAI GUAN HOCK SAR BANKRUPTCY NOS WA-29NCC-759-06 OF 2022, WA-29NCC-760-06 OF 2022 AND WA-29NCC-761-06 OF 2022 21 October 2022 Gavin Jay Anand a/l Jayapal (Gavin Jayapal) for the judgment creditors. Nurul Azua bt Abu Yazid (Gunaseharan & Linda) for the judgment debtors. Chai Guan Hock SAR: JUDGMENT OF THE COURTIntroduction [1]The Judgment Debtors in cases no. WA-29NCC-759-06/2022, WA- 29NCC-760-06/2022 and WA-29NCC-761- 06/2022 (“JD(s)”), each files a separate application via Summons in Chambers to set aside / strike out the bankruptcy notices dated 23.6.2022 and also to stay the present the bankruptcy proceedings until the disposal of the applications. [2]The bankruptcy notices in all (3) cases are dated 23.6.2022 (“BN”) and all (3) applications via Summons in Chambers to set aside / strike out the BN and also to stay the present the bankruptcy proceedings until the disposal of the applications are filed in Encl(s). 5 (“applications”). [3]Prayers prayed by the JD(s) in all (3) applications in Encl(s). 5 are identical, as follows: 1. Bahawa Penghutang Penghakiman dibenarkan untuk membuat permohonan ini; 2. Bahawa penangguhan atau penggantungan bagi tindakan lanjutan susulan daripada arahan di dalam Notis Kebankrapan bertarikh 23.6.2022 dibenarkan sehingga pelupusan muktamad permohonan ini; 3. Bahawa Notis Kebankrapan bertarikh 23.6.2022 ke atas Penghutang Penghakiman diketepikan dan/atau dibatalkan; 4. Bahawa kos permohonan ini ditanggung oleh Pemiutang- Pemiutang Penghakiman; 5. Lain-lain perintah yang difikirkan suaimanfaat oleh Mahkamah yang Mulia ini. [4]Upon perusing the applications, affidavits and written submissions filed by the JD(s) and Judgment Creditor(s) (“JC(s)”) in all (3) cases, it appears that the prayers, grounds of application and contents of the affidavits and written submissions put forward by the JD(s) and JC(s) in all (3) applications are identical. [5]This Court has therefore fixed the hearings / decisions for all (3) applications together. Brief facts Page 2 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 [6]On 30th March 2022, the JC(s) obtained the judgment from the Kuala Lumpur High Court vide case no. WA- 22NCC-326-06/2019 (“Judgment”) against the JD(s) for the following reliefs– a. Deklarasi bahawa Penghakiman Persetujuan bertarikh 16.01.2019, seperti yang direkodkan di dalam Guaman Sivil No.: WA-22NCC-551- 12/2018, adalah diketepikan, terbatal dan tidak boleh dikuatkuasakan; b. Perintah bahawa injunksi kekal diberikan untuk melarang Defendan Pertama, Defendan Ke-2, Defendan Ke-4 dan Defendan Ke-5 dan/atau ejen-ejennya, pekerja-pekerjanya dan/atau wakil-wakilnya daripada memindahkan, menjual, mencaj, mencagar dan/atau melupuskan mana-mana saham di dalam Bintang Iradat (M) Sdn Bhd kecuali dan mengikut terma Penghakiman ini; c. Perintah injunksi kekal diberikan untuk melarang Defendan Pertama, Defendan Ke-2, Defendan Ke-4 dan Defendan Ke-5 dan/atau ejenejennya, pekerja-pekerjanya dan/atau wakil wakilnya daripada memindahkan, menjual, mencaj, mencagar dan/atau melupuskan mana-mana bahagian hartanah yang terkandung di Geran 65301, Lot 1176, Seksyen 69, Bandar Kuala Lumpur yang terletak di No. 74, Jalan Rotan, Off Jalan Kampung Attap, 50460 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur dalam apa jua cara kecuali mengikut terma Penghakiman ini; d. Deklarasi bahawa keseluruhan 100,000 saham Bintang Iradat (M) Sdn Bhd (Syarikat No.: 510546-X) yang kini berdaftar milikan oleh Kayveas Holdings Sdn Bhd hendaklah diperuntukkan di bawah kuasa Ketua Pengarah Insolvensi berikutan pembatalan pendaftaran myPPP pada 14.01.2019 dan dianggap sebagai sebahagian daripada harta myPPP; e. Deklarasi bahawa semua bangunan yang terletak di Geran 65301, Lot 1176, Seksyen 69, Bandar Kuala Lumpur yang terletak di No. 74, Jalan Rotan, Off Jalan Kampung Attap, 50460 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur adalah milik myPPP dan hendaklah diperuntukkan di bawah kuasa Ketua Pengarah Insolvensi berikutan pembatalan pendaftaran myPPP pada 14.01.2019; f. Perintah bahawa Defendan Pertama, Defendan Ke-2, Defendan Ke-4 dan Defendan Ke-5 dan/atau ejen- ejen, pekerja-pekerja dan/atau wakil-wakilnya untuk mengosongkan dan memberikan pemilikan kosong semua bangunan yang terletak di bawah Geran 65301, Lot 1176, Seksyen 69, Bandar Kuala Lumpur yang terletak di No. 74, Jalan Rotan, Off Jalan Kampung Attap, 50460 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur kepada Ketua Pengarah Insolvensi serta merta; g. Defendan Pertama, Defendan Ke-4 dan Defendan Ke-5 membayar ganti rugi teladan yang berjumlah sebanyak RM150,000.00 masingmasing kepada Defendan Kesepuluh (Ketua Pengarah Insolvensi); h. Defendan Pertama, Defendan Ke-4 dan Defendan Ke-5 diarahkan membayar kos sebanyak RM300,000.00 secara bersama dan berasingan kepada Plaintif-Plaintif, tertakluk kepada pembayaran alokatur; i. Tuntutan Plaintif-Plaintif terhadap Defendan Ke-6, Defendan Ke-7, Defendan Ke-8 dan Defendan Ke-9 ditolak dengan kos; j. Plaintif-Plaintif membayar kos ditetapkan sebanyak RM35,000.00 kepada Defendan Ke-6, Defendan Ke-7 dan Defendan Ke-8 secara kolektif, tertakluk kepada pembayaran alokatur; dan k. Plaintif-Plaintif membayar kos ditetapkan sebanyak RM35,000.00 kepada Defendan Ke-9 secara peribadi, tertakluk kepada pembayaran alokatur. [7]The judgment on which the BN(s) are founded is based on the costs awarded and allocatur fee as stipulated in paragraph h. of the Judgment, wherein the JD(s) are ordered to pay costs of RM300,000.00 together with allocatur fee of RM12,000.00 to the JC(s). [8]Dissatisfied with the Judgment, the JD(s) appealed to the Court of Appeal against the decision of the High Court and the hearing of the appeal had been fixed on 14.2.2023 vide cases no. W-02(NCC)(W)-621-04/2022 and W- 02(NCC)-773-04/2022. [9]Subsequently, the JD(s) applied for stay of execution of the Judgment at the High Court, however, it was dismissed on 26.9.2022. Presently, the decision of the High Court in dismissing the stay application is pending appeal at the Court of Appeal. JC(s)’ submissions [10]In brief, the JC(s) submit that– Page 3 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 (a) the applications disclose no valid grounds to set aside the BN(s) as there is no counterclaim, set off or cross demand that equals or exceed the amount claim in the BN(s), referring to the cases of Re Lim Siew Eng; ex parte The University of British Columbia [2021] MLJU 2093; Ber Anuar; ex parte Kontron Asia Pacific Design [2022] MLJU 1641 (b) the JC(s) ought not to be denied the fruits of litigation citing the case of Wu Shu Chen v Raja Zainal Abidin [1995] 3 MLJ 224 (c) relying on the case of Sime Darby Energy Solution v RZH Setia Jaya [2021] 6 MLRA 485, the sealed Judgment dated 30.03.2022 was served on the JD(s)’ solicitors on 24.05.2022, there is a delay of 95 days on the part of the JD(s) in filing the stay of execution application; (d) the Judgment imposes joint and several liability on the JD(s), applying the case of Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian @ Marie [2021] 5 MLJ 253; Re Balasubramaniam; Ex Parte Annamalai [1957] 3 MC 128; Wong Mun Chong v Amfinance [2008] MLJU 10. JD(s)’ submissions [11]The JD(s) briefly submit that– (a) there are several appeals pending against the Judgment and also against the decision of the High Court in dismissing the stay of execution application. Therefore, the Judgment upon which the BN(s) are founded, is not final, referring to section 3(a)(i) of the Insolvency Act 1967 (“IA”); (b) the amount claimed in the BN(s) is not in accordance with the terms of the Judgment and is excessive; (c) the JC(s) filed 3 separate bankruptcy notices against the JD(s) individually, claiming the sum of RM312,000.00 against each of them in the separate BN(s) and this is tantamount to claiming RM936,000.00 altogether, which is 3 times more than the total amount claimable in accordance with paragraph h. of the Judgment, citing the case of Sumathy Subramaniam v Subramaniam Gunasegaran and Anor [2017] MLRAU 280 and (d) the JC(s) should have only filed a single bankruptcy notice against any one of the JD(s) claiming the sum of RM312,000.000 and allocatur fee. The JC(s) should not have filed 3 separate BN(s) against all (3) JD(s) claiming RM312,000.00 and allocatur fee against each of them, referring to s 3(2)(ii) IA. Issues [12]Upon careful deliberation and consideration of the applications in Encl(s). 5, affidavits and written submissions, this Court finds that the JD(s) despite setting out several prayers in the applications, the JD(s) in their written submissions have only submitted on two (2) particular issues– (a) whether the Judgment dated 30.3.2022 is a final judgment within the meaning of section 3(1)(i) of the IA and (b) whether the amount claimed in the BN(s) is excessive, therefore ought to be set aside by the Court. Findings of this CourtIssue (a): whether the Judgment dated 30.3.2022 is a final judgment within the meaning of section 3(1)(i) of the IA. [13]In respect of issue (a), the law is settled and clear in that strict compliance with ss 3(1)(i) and (2)(ii) IA and rule 93 Insolvency Rules 2017 (“IR”) is mandatory. Any procedural non-compliance with the requirements under the said provisions cannot be regarded as mere procedural irregularity – see Development & Commercial Bank Bhd v. Datuk Ong Kian Seng [1995] 3 CLJ 307, FC. [14]Section 3(1)(i) of the IA provides that– If a creditor has obtained a final judgment or final order against him for any amount and execution thereon not having been stayed has served on him in Malaysia, or by leave of the court elsewhere, a bankruptcy notice under this Act requiring him to pay the judgment debt or sum ordered to be paid in accordance with the terms of the judgment or order with interest quantified up to the date of the issue of the bankruptcy notice, or to secure or compound for it to the satisfaction of the creditor or the court; and he does not within seven days after service of the notice in case the service is effected in Malaysia, and in case is effected elsewhere then within the time limited in that behalf by the order giving leave to effect the service, either comply with the requirements of the notice or satisfy the court that he has a counterclaim, set off or cross Page 4 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 demand which equals or exceeds the amount of the judgment debt or sum ordered to be paid and which he could not set up in the action in which the judgment was obtained or in the proceedings in which the order was obtained: Provided that for the purposes of this paragraph and of section 5 any person who is for the time being entitled to enforce a final judgment or final order shall be deemed a creditor who has obtained a final judgment or final order. [15]The salient principle in respect of a final judgment of the court is that the judgment once pronounced by the court and properly perfected by the parties, the said judgment is to be honoured and observed by the parties as a perfected judgment that is final and certain unless and/or otherwise set aside in accordance with the principle laid down in the Federal Court’s cases of Badiaddin bin Mohd Mahidin & Anor v. Arab Malaysian Finance Bhd [1998] 2 CLJ 75; [1998] 1 MLJ 393; Hock Hua Bank Bhd v Sahari bin Murid [1981] 1 MLJ 143. [16]In the case of Dharshini Ganeson v. Doraisingam Thambyrajah [2020] 1 LNS 638, the Court of Appeal held that once pronouncement of a judgment or order by the court has been made, the terms of the judgment or order are drawn up and approved by the parties, and perfected by the court affixing its seal in accordance to the provisions of O. 42 r. 10 of the Rules of Court 2012, then it is the final order sealed by the court that gives effect to the pronouncement of the court and it is the sealed order or judgment of the court that is capable of being enforced. [17]In Re Udos AK Riging, EX P Seabanc Kredit Sdn Bhd [1994] 3 MLJ 383, the Court held that the judgment obtained by the judgment creditor was a final judgment as the judgment debtor had not taken any step to challenge the judgment when the judgment was given in January 1976– Next, the learned counsel cited the case of Sovereign General Insurance Sdn Bhd v Koh Tian Bee [1988] 1 MLJ 304 as laying down the principle that in exercising jurisdiction in bankruptcy, the judge cannot go behind the judgment by disputing validity of orders when orders have not been set aside. Indeed it is true, but by saying that the default judgment in this case is not a final judgment, I am not in any way going behind the judgment in coming to the conclusion whether the default judgment is a valid judgment or otherwise. What I am saying is the default judgment is being questioned by the debtor through the proper legal process. I would not know what the outcome of his appeal to the High Court [would be] in regard to the dismissal of his application to set aside by the learned magistrate. The course he has taken is allowed by law. So, until there is finality on the issue, the said default judgment cannot, at the date of the issue of the bankruptcy notice, be termed as final judgment for the purpose of s 3(1)(i) of the Act. At any rate the fact in the case above-quoted can be easily distinguished from the present matter before me. There the judgment (not clear whether default judgment or judgment on merit) was obtained in January 1976. No step was taken to have the said judgment set aside or appealed against. In November 1980, after a lapse of more than four years, a bankruptcy notice was issued. From the facts, it is clear that by November 1980 the said judgment must necessarily be a final judgment as no step was taken to challenge the judgment when given in January 1976. [18]Applying the authorities above, it is apparent that in the present case, the Judgment was entered against the JD(s) on 30.3.2022 and subsequently the BN(s) were issued on 23.6.2022, and whereas the stay of execution application against the Judgment by the JD(s) was only filed later at the High Court on 5.7.2022. [19]It is also apparent that the JD(s) has taken approximately 95 days to file that stay of execution application considering that the Judgment had been rendered on 30.3.2022. [20]Therefore, this Court finds that at the material time when the JC(s) requested for the issuance of the BN(s) and when the BN(s) was issued, respectively on 23.6.2022, the Judgment shall be considered and observed as a final Judgment within the meaning of section 3(1)(i) IA as at that point in time the JD(s) had yet to file any stay of execution application against the Judgment. [21]In respect of the JD(s)’ contention that there are several appeals pending against the Judgment and also against the decision of the High Court in dismissing the stay of execution application, and hence, the Judgment is not final, this Court is of the view that the JD(s)’ contention is without merit for the reasons as follows: (a) no specific provision in the IA and IR that expressly bars the issuance of a bankruptcy notice in case that there is a pending appeal against the judgment and/or order on which the BN is founded; (b) even so, the JD(s) has not provided any ground, explanation and / or justification to support the JD(s)’ basis that the disputes as to the finality, validity and / or legality of the Judgment merit this Court’s consideration for the setting aside of the BN(s); and Page 5 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 (c) finally, pending the disposal of the appeals against the Judgement and decision of the High Court at the COA do not ipso facto justifies the setting aside of the present BN(s). Issue (b): whether the amount claimed in the BN(s) is excessive, therefore ought to be set aside by the Court. [22]It bears reiterating that if the JD(s) intends to challenge and / or the dispute the amount claimed in the BN(s) for the reason that it is incorrect and / or excessive, JD(s) shall comply with the statutory requirements set forth in ss 3(1)(i) and (2)(ii) IA and rule 93 IR – see Development & Commercial Bank Bhd v. Datuk Ong Kian Seng (supra). [23]Section 3(2)(ii) IA allows the JD(s) to invalidate the BN(s) provided that the JD(s) give a written notice and / or files and serves an affidavit in opposition on the JC(s) within 7 days from the date of being served with the BN(s). Failing to do so within that period would result in the JD(s) committing an act of bankruptcy upon which a creditor’s petition under section 5 of the IA can be presented against the JD(s) – see Datuk Lim Kheng Kim v Malayan Banking Bhd [1993] 2 MLJ 298, Supreme Court. [24]Based on the facts of the present case, it is apparent that the JD(s) has failed to file any affidavit other than filing the present application in Encl(s). 5 to set aside the BN(s). Such failure on the part of JD(s) to comply with the 7 days’ time limit as required under s 3(2) IA cannot be regarded as a mere procedural irregularity. This Court therefore opines that the JD(s) cannot be allowed to challenge, invalidate, set aside and / or oppose the validity of the BN(s) on the ground on which the JD(s) now relies on in the applications in Encl(s). 5 – see Re Woo Yoke San, ex p OCBC Bank (M) Bhd [2006] 2 CLJ 589. [25]Further to that, this Court has also examined the applications in Encl(s). 5 together with the JD’s affidavits and written submissions and much to this Court’s dismay, even when the applications have been filed by the JD(s) to set aside the BN(s), the applications have not properly condescended to particulars of any counterclaim, set off or cross demand as required under s 3(1)(i) IA. [26]It is also clear that there is no particular in respect of whether the JD(s) are challenging the validity and / or the amount claimed in the BN on which basis, within the meaning of s 3(1)(i) IA. Whether it is for a ‘counterclaim’ or ‘set-off’ or ‘cross demand’ is not properly explained, quantified and particularised in the JD(s)’ applications, affidavits and/or written submissions as it appears that the JD merely alleges that– (a) the JC(s) have filed 3 separate bankruptcy notices against the JD(s) individually, claiming the sum of RM312,000.00 against each of them in every single BN and this is tantamount to claiming RM936,000.00 altogether which is contrary with paragraph h. of the Judgment, citing the case of Sumathy Subramaniam v Subramaniam Gunasegaran and Anor [2017] MLRAU 280 and (b) the JC(s) should have filed a bankruptcy notice against any one of the JD(s) claiming the sum of RM312,000.000 together with alocatur fee and the JC(s) should not have filed 3 separate BN(s) against all (3) JD(s) claiming RM312,000.00 against each of them, referring to s 3(2)(ii) IA. [27]In Perwira Habib bank Bank Malaysia v. Samuel Pakianathan [1993] 3 CLJ 349; [1993] 2 MLJ 423, the Supreme Court held that– “...that three ingredients must be satisfied before the existence of a counterclaim by the debtor can be a defence to a judgment creditor’s petition. In Sovereign General Insurance Sdn Bhd v. Koh Tian Bee 3 at p 305, the Federal Court speaking through Lee Hun Hoe CJ, held that: ‘If the respondent was making a cross-demand he must quantify it’. The burden of proof is on the respondent to show by the affidavit that the counterclaim must be capable of being quantified in terms of money and the affidavit must quantify it. This is so stated by Warner J in Re a debtor (No 75N of 1982, Warrington), ex p the debtor v. National Westminster Bank and another appeal 4. The second ingredient to be satisfied in the affidavit is that the counterclaim must be put forward in good faith and must have reasonable probabilities of success. Lastly, the affidavit must show that the counterclaim could not have been set up in the action in which the judgment relied on by the creditor was obtained.” [28]In Sovereign General Insurance Sdn Bhd v. Koh Tian [1988] 1 CLJ Rep 277; [1988] 1 CLJ 155; [1988] 1 MLJ 304, Lee Hun Hoe SCJ delivering the judgment of the Court held that: “If the respondent was making a cross-demand, he must quantify it. He just could not come to court and said his shares Page 6 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 were worth considerably more. The burden of proof is on the respondent to show by the affidavit or affidavits three things which were stated clearly by Warner J. in Re a debtor (No 75N of 1982, Warrington), ex parte The Debtor v. National Westminster Bank [1983] 3 All ER 545 553 as follows: “... First, the affidavit or affidavits must show that he has a cross- demand against the creditor which is genuine. To satisfy that requirement, the cross-demand must be put forward in good faith and must have a reasonable probability of success, or, as it has also been expressed, must give rise to a triable issue. In the latter respect, there is no hard and fast rule as to the degree of proof required. It depends in each case on the particular facts and circumstances of that case. Second, the affidavit or affidavits must show that the cross-demand could not have been set up in the action in which the judgment relied on by the creditor was obtained. Third, the affidavit or affidavits must show that the cross-demand need not be for a liquidated sum or even for a sum of money at all. But it must be capable of being quantified in terms of money and the affidavit or affidavits must quantify it.” [29]In the Federal Court case of Datuk Lim Kheng Kim v. Malayan Banking Berhad [1993] 3 CLJ 324; [1993] 2 MLJ 298, it was held that– “It is,... necessary that the affidavit in question should, on the face of it, show a counterclaim, set-off, or cross demand which equals or exceeds the amount of the Judgment debt, and which the debtor could not have set up in the action in which the judgment or order was obtained.’ The Supreme Court in that case went on to further say that “We are concerned here with the contents of the said affidavit. It merely denies and disputes that the appellant was indebted to the respondent in the sum of RM2,603,913.28, but fails to disclose that he has a counterclaim, set-off or cross demand, etc. against the respondent, which he is required to depose under s. 3(1)(i) of the Bankruptcy Act (‘the Act’) and provided for in Form 7. Following the above decision and in the face of the above affidavit, we are of the opinion that the said affidavit cannot operate as an application to set aside the bankruptcy notice within the contemplation of s. 3(1)(i) of the Act, and the case should have been treated as if no affidavit under r. 95 had in fact been filed.” [30]In Re Cheah Wee Liam Ex P Robert Teng Lye Hock [1999] 4 CLJ 305; [1999] 6 MLJ 615, the HC held that– “Similarly, following the same judgment of the Supreme Court, the affidavit does not attract the provisions of proviso 2(iii) of s. 3 of the Act because, first, it does not condescend to particulars of the amount actually due. Indeed, the affidavit merely alleges that the amount stated in the bankruptcy notice is not the latest amount (“bukan merupakan amaun yang terakhir”)” [31]In Liew Hon Kong @ Liew Kwan Voon v. Bank Pertanian Malaysia Berhad [2019] 1 LNS 1712, per Abu Bakar Jais– “It is trite the JD’s submission that the amount claimed by the JC is incorrect could not be simply accepted. This is because the JD did not give and provide explanation what is the correct amount to be claimed. Since the JD thinks the amount claimed is wrong, the JD must state what should be the correct amount to be claimed by the JC. Since this is not done, the JD’s contention on this issue with respect cannot be accepted.” [32]It is also worth pointing out that, s 3(2)(ii) IA operates to render the BN(s) valid notwithstanding any dispute of the sum stated therein subsequently exceed the amount actually due and owing. This is because the mandatory provisions prescribed in s 3(2)(ii) only allow the JD(s) to challenge, invalidate, set aside and / or oppose the BN(s) issued, provided that the JD(s) shall within the time period prescribed in the BN(s) gives in notice to the JC(s) and / or file an affidavit in opposition to challenge the validity of the BN(s) on the ground that amount claimed in the BN(s) is larger than that lawfully due – see J. Raju M. Kerpaya v. Commerce International Merchant Banker Bhd [2000] 3 CLJ 104, CA. [33]In the circumstances, this Court finds that the applications in Encl(s). 5 cannot operate as the applications to set aside the BN(s) and do not come within the meaning of s 3(1)(i) IA and s 3(2)(ii) IA. This Court further opines that as the applications are not so made in compliance with the statutory requirements set forth in s 3(1)(i) IA and s 3(2)(ii) IA, the present applications are bound to fail. [34]As for the issue as to whether the amount claimed in the BN(s) is excessive, therefore ought to be set aside. Referring to para. (h) of the Judgment dated 30.3.2022, JD(s) have been ordered as follows– h. Defendan Pertama, Defendan Ke-4 dan Defendan Ke-5 diarahkan membayar kos sebanyak RM300,000.00 secara bersama dan berasingan kepada Plaintif-Plaintif, tertakluk kepada pembayaran alokatur; Page 7 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 [35]It is not in dispute that the 1st, 4th and 5th defendants are the JD(s) in the present cases and the 1st defendant is the JD in case no. WA-29NCC- 760-06/2022, 4th defendant is the JD in case no. WA-29NCC-761-06/2022 whereas the 5th defendant is another JD in case no. WA-29NCC-759- 06/2022. [36]Essentially, the JD(s)’s predominant ground for the setting aside of the BN(s) is that since there are (3) separate BN(s) have been filed against each of the JD(s) wherein every single BN is claiming the sum of RM312,000.00 together with allocatur fee, the total amount of the claims arising from these BN(s) would come up to RM936,000.000, which is obviously excessive, wrong in law and also not in accordance with paragraph h. of the Judgment. [37]Be that as it may, upon carefully examining the said Judgment, this Court finds that the paragraph h. of the Judgment ultimately orders JD(s) to pay the JC(s) the sum of RM312,000.00 together with allocatur fee on jointly and severally liability basis. [38]In the Federal Court’s case of Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian Nagappan [2021] 7 CLJ 823, per Nallini Pathmanathan (FCJ) at paras. 27-29, held that– [24] In this jurisdiction in any event, the common law is inapplicable, as we are governed by the Contracts Act 1950. section 44 of the Contracts Act 1950 (Act 136) (“the Contracts Act”) is the relevant provision relating to joint liability. It states: (1) When two or more persons make a joint promise, the promisee may, in the absence of express agreement to the contrary, compel any one or more of the joint promisors to perform the whole of the promise. (emphasis added) [25] Section 44 of the Contracts Act is in pari materia with s. 43 of the Indian Contract Act, 1872. In Re Vallibhai Adamji (supra), BJ Wadia observed that the provision: ... makes the liability on all contracts joint and several, and allows the promisee to sue one or more of the several joint promisors as he chooses, and excludes the right of any one of them to be sued along with his co-promisor or co- promisors. (See also: Union of India v. East Bengal River Steamer Service Limited 1963 Indlaw Cal 177; AIR 1964 Cal 196) [26] In summary therefore, unless a contrary intention is expressed in the contract, all joint contracts effectively impose a full liability for the debt on each of the promisors, by virtue of s. 43 of the Indian Contract Act, 1872: see Pollock & Mulla: Indian Contract and Specific Relief Acts - vol. 1, 13th edn., (India: LexisNexis, 2009), at p. 1043-1044. Thus, where the debts are jointly incurred, each promisee is liable for the whole amount: see Dhanki Mahajan v. Rana Chandubha Vakhatsing AIR 1969 SC 69. [27] Accordingly, so long as a judgment debt remains unrealised, the judgment creditor is entitled to proceed against one or any number of judgment debtors to secure the performance of an obligation in its entirety. [28] The issue that possibly gives rise to confusion is s. 44(2) of the Contracts Act which allows the promisor who has paid the full promised amount to claim contribution from the joint promisor for an equal contribution. This means that the liability for the full promised sum is shared equally between all the promisors. However that is between the promisors, inter se. It does not affect the rights of the creditor which are governed by s. 44(1) of the Contracts Act. [29] This brings us to the underlying rationale for joint liability as opposed to joint and several liability. Each of these doctrines relates to the number of promises made, and not the number of promisors who made a particular promise. In the case of joint liability, there is one promise and two or more promisors. Each is liable to the extent of the promised amount. In the case of a joint and several liability, there is more than one promise. The promisors make two or more promises and thus several liability arises. [39]In Kejuruteraan Bintai Kindenko Sdn Bhd v Fong Soon Leong [2021] 5 CLJ 1, the Court of Appeal held that judgment debtors are regarded as jointly and severally liable to honour the entire judgment sum, unless it is stated otherwise. That is to say, the judgment sum is not halved and / or shared as each of the JD(s) is liable for the entire Page 8 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 judgment sum. The reasoning of Court of Appeal in this case was cited with approval by the Federal Court in Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian Nagappan (supra). [40]As for the case of Sumathy Subramaniam v Subramaniam Gunasegaran & Another Appeal [2018] 2 CLJ 305, this Court opines that the JD(s)’ reliance on the said case is misguided – see paras. 31-33 Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian Nagappan (supra). For ease of reference paras. 31-33– [31] As stated earlier, the courts below regarded themselves bound by the earlier Court of Appeal decision in Sumathy. In Sumathy, the creditor sued the principal borrower and the guarantor for monies outstanding under a friendly loan. Summary judgment was entered against both defendants, on the same terms, but the judgment did not state whether the liability of the parties was joint or several. Subsequently, two separate bankruptcy notices were filed at the same time against the principal borrower and the guarantor, both specifying the judgment debt of RM291,800. [32] The Court of Appeal held at para. 19 of the judgment that a plaintiff who becomes a judgment creditor where the liability is joint, is only entitled to seek recovery in equal proportions against each of the defendants. This premise is, with respect, flawed because it pre- supposes that liability is proportionate to the number of promisors, from the perspective of the creditor. In Sumathy, the position of the creditor was conflated with the position of the debtors or promisors inter se, as we have explained above. [33] We would also respectfully point out that the doctrine of merger has no application in the issue of whether or not the enforcement court can look behind the judgment. Merger comes into play when the cause of action is sought to be revisited against the same parties. [41]In other words, the Federal Court in the case of Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian Nagappan (supra) held that the Court of Appeal in Sumathy Subramaniam v Subramaniam Gunasegaran & Another Appeal (supra) has pre-supposed that liability to pay the debt is proportionate to the number of promisors, from the perspective of the creditor and that the doctrine of merger has no application in the issue of whether or not the enforcement court can look behind the judgment. [42]In the premises, this Court finds that the JD(s) are jointly and severally liable for the entire judgment sum as entered against them, and therefore, each of them is liable to satisfy the payment for the entire amount as ordered in paragraph h. of the Judgement. Consequently, the JC(s) herein, is entitled to issue the BN(s) separately against every single JD(s) to recover the entire judgment sum, and the JD(s) do pay the JC on jointly and severally liability basis, the entire judgment sum as claimed in the BN(s). [43]The JC(s) are entitled to commence bankruptcy proceedings against any one or all of the JD(s) to claim the full Judgment sum in para. h together with allocatur fee for as long as the judgment sum remain unrealised. Once the JC(s) have fully recovered the full judgment sum from any of the JD(s), the JC(s) shall not be entitled to pursue any further claim against the other JD(s). Compliance with the Bankruptcy Law [44]Further to that, This Court finds that the JD(s) have too failed to state in the applications in Encl(s). 5 to set aside the BN(s) the correct and specific provisions of IA and IR under which the applications are founded to move this Court to hear such applications. There is also no explanation has been given by the JD(s) in the affidavits and / or written submissions as to why the JD(s) have not cited any provision in the applications in Encl(s). 5 to set aside the BN(s) and / or provide any reason for this Court’s consideration for when this Court may exercise its discretion to cure the defect and / or the irregularity therein– see TN Metal Industries Sdn Bhd v. Ng Pyak Yeow [1995] 1 LNS 320; [1996] 4 MLJ 567; Cheow Chew Khoon (t/a Cathay Hotel) v. Abdul Johari bin Abdul Rahman [1995] 4 CLJ 127; [1995] 1 MLJ 457. [45]In the circumstances, this Court holds that there is no provision of law under which this Court is being moved to hear the applications in Encl(s). 5. The Bankruptcy Court is distinctly and specifically governed by the powers and jurisdiction exercisable only in strict compliance with the provisions of the IA and IR failing which any order granted by the court in breach of the IR and IA is liable to be set aside– see section 24 Courts of Judicature Act 1964, Badiaddin bin Mohd Mahidin & Anor v. Arab Malaysian Finance Bhd [1997] 1 LNS 353; [1998] 1 MLJ 393; Sobri bin Arshad v. Associated Tractors Sdn Bhd [1991] 3 CLJ Rep 756; [1991] 3 MLJ 32. [46]There is also no amendment application and/or any attempt on the part of the JD(s) to regularise the defective applications in Encl(s). 5. Page 9 of 9 Datuk Seri Maglin Dennis D’Cruz & Ors v Dato Ly Kim Cheong and other cases [2022] MLJU 3092 Conclusion [47]Based on the aforesaid reasons, and after careful scrutiny and judicious consideration of the parties’ affidavits and written submissions, the applications in Encl. 5 - WA-29NCC-759-06/2022; Encl. 5 - WA-29NCC-760- 06/2022; and Encl. 5 - WA-29NCC-761-06/2022 are dismissed with costs subject to allocatur. End of Document