KITARAN SUKMA SDN. BHD. v 1. ) CASA BESTARI SDN. BHD. 2. ) ROYAL PAHANG POLO CLUB SDN. BHD.
Catchwords
The dispute concerned an appeal against the dismissal of a claim for recovery of RM920,000.00 paid pursuant to two Land Lease Agreements relating to parcels of agricultural land in Rompin, Pahang, intended for an integrated livestock and oil palm plantation project (“the said lands”). The Appellant was a company engaged in oil palm plantation operations. The 1st Respondent was a company alleged to have acted as an authorised agent, while the 2nd Respondent was the party presented as having authority over the said lands. The Appellant commenced proceedings in the Sessions Court, alleging that it had been fraudulently induced by the Respondents’ misrepresentations into entering the Lease Agreements and making substantial payments. The Sessions Court dismissed the claim, leading to the present appeal. The Appellant contended that the Respondents had falsely represented that they had authority over the said lands, thereby inducing the Appellant to enter into the Lease Agreements and to pay RM920,000.00. It was argued that these misrepresentations rendered the Lease Agreements voidable under section 19 of the Contracts Act 1950, entitling the Appellant to rescission and restitution. The Appellant further alleged unjust enrichment and asserted that adverse inferences should be drawn against the Respondents for failing to call material witnesses. The Respondents denied any fraud or misrepresentation and maintained that the Appellant was at all material times aware that the said lands were government land merely applied for by the 2nd Respondent. The Respondents contended that the 1st Respondent acted solely as an agent for the limited purpose of collecting rental on behalf of the 2nd Respondent and bore no independent contractual liability. They further argued that the Appellant’s pleadings were fatally deficient for failure to particularise fraud and misrepresentation, and that no breach of the Lease Agreements had been proven. The issues for this Court’s determination were: (a) whether the learned Sessions Court Judge had erred in law or fact in dismissing the Appellant’s claims for fraud, misrepresentation, and restitution; and (b) whether the findings of the trial court were plainly wrong so as to warrant appellate intervention. Held, dismissing the appeal with costs of RM5,000.00. 1. The Appellant failed to plead fraud and misrepresentation with the strict particularity required by law. The allegations were general in nature and did not specify the material facts constituting the alleged fraud, including the persons involved, the manner, timing, or recipients of the alleged misrepresentations. This failure was fatal and justified the dismissal of the claim. 2. The evidence established that the Appellant was aware at all material times that the said lands were not owned by the 2nd Respondent but were merely the subject of applications to the District Land Office. The Lease Agreements, prepared by the Appellant’s own solicitors, expressly reflected this position and made the Appellant’s registration as lessee conditional upon approval of title. No actionable misrepresentation was therefore proven. 3. The 1st Respondent acted solely as an agent of the 2nd Respondent for the purpose of collecting rental payments. The Lease Agreements expressly described the 1st Respondent as an agent and imposed no substantive contractual obligations upon it. In the absence of proof of fraud or a contract to the contrary, the 1st Respondent could not be held personally liable under section 183 of the Contracts Act 1950. 4. The Appellant failed to prove any breach of the Lease Agreements by the 2nd Respondent. Although the agreements imposed obligation
Judges (1)
Judgment
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Read on eJudgmentSource: eJudgment (cb-12bncvc-1-09-2022)