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Malayan Law Journal Unreported/2010/Volume /Malaysian Merchant Marine Berhad and Others v BHLB Trustee Berhad and Others - [2010] MLJU 644 - 17 May 2010 [2010] MLJU 644

Malaysian Merchant Marine Berhad and Others v BHLB Trustee Berhad and Others
HIGH COURT (KUALA LUMPUR) ABDUL AZIZ BIN ABDUL RAHIM, J 17 May 2010 Pramjit Singh together with Lai Jin Shawn (Messrs. Harjit Sandhu) for Plaintiffs G. Rajasingam together with Alvin Julian for 1st Defendant Mohd Shahrul Fazli (Messrs. Shearn Delamore & Co), Wong Chee Lin together with Patricia Ng (Messrs. Skrine) for 2nd Defendant ABDUL AZIZ BIN ABDUL RAHIM, The parties The 1st and 2nd Plaintiffs are Malaysian companies with registered and service addresses in Malaysia. The 3rd Plaintiff is a foreign company incorporated in the Republic of Panama with the registered address in Panama City, Republic of Panama; however, the 3rd Plaintiff also has a service address in Malaysia. The 2nd and 3rd Plaintiffs are also wholly owned subsidiaries of the 1st Plaintiff. The 1st Plaintiff is public listed company listed on the Main Market of Bursa Malaysia Securities Berhad. The 2nd Plaintiff is the owner of the ship "MMM Dayton" ["The Dayton"] which was registered in Panama and the 3rd Plaintiff is owner of the ship "MMM Kingston" ["The Kingston"]. The 1st Plaintiff was given the full authority to manage the business of the two ships. The 1st Defendant is a Malaysian company and the 1st Defendant has granted to the 1st Plaintiff certain facilities and the 1st Defendant also act as the security trustee under two debentures created by the Plaintiffs pursuant to the grant of the facilities by the 1st Defendant. The 2nd Defendant is an established local accounting and auditing firm with address of service in Malaysia. The 3rd and 4th Defendant are the partners in the 2nd Defendant. The 3rd and 4th Defendant have been appointed, under the debentures, as Receivers and Managers for the two ships - The Dayton and The Kingston. The background facts The 1st Plaintiff had entered into a issuance facilities agreement dated 18.11.2003 [Exhibit M-3 in the Plaintiff's 1st affidavit] whereby the 1st Plaintiff was the issuer of Islamic debt securities totaling a nominal value of RM 159,435,000.00 under the Syariah principle of Al-Bai'bithaman Ajil ['ABA']. The beneficiary holder of the ABA is the EPF. The securities for the amount payable by the 1st Plaintiff are : firstly a debenture dated 28.2.2005 executed by the 1st and 2nd Plaintiff and 1st Defendant [the 1st debenture - Exhibit A-1 of the 1st Defendant's 1st affidavit] under which the 2nd Plaintiff charged the ship The Dayton as first fixed charge in favour of the 1st Defendant. Secondly, the 1st and the 3rd Plaintiff and the 1st Defendant executed a second debenture dated 16.8.2006 [also Exhibit A-1] under which the 3rd Plaintiff charged the ship The Kingston as first fixed charge in favour of the 1st Defendant. Thirdly, the 2nd and 3rd Plaintiff also executed legal mortgages over the ships

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The Dayton and The Kingston which were registered in the relevant shipping registries. The legal mortgage over The Dayton was registered at the Public Registry of Panama and the legal mortgage over The Kingston was registered at the Office of the Registrar of Malaysian Ships, at Port Klang, Malaysia. Pursuant to the securities arrangement as above, the 1st Plaintiff entered into a Trust Deed [Exhibit YHH-6 in 1st Defendant's affidavit in reply] with the 1st Defendant on 18.11.2003. Under Clause 9.1(u) of the Trust Deed an event of default occurs when the rating of the ABA by Malaysian Rating Corporation Berhad falls below the rating of BBB. In this case, the ABA rating did fall below the rating of BBB. As a result thereof the 1st Defendant issued a notice of occurrence of an event of default dated 29.3.2010 to the 1st Plaintiff pursuant to Clause 9.1 of the Trust Deed. At the time the notice of default was issued, the rating of the ABA had been downgraded by the Malaysian Rating Corporation to BB+ID. This is evident in paragraph 19 of the 1st Defendant's affidavit and also in Exhibit M-4 in the Plaintiffs' affidavit. The 1st Plaintiff responded to the 1st Defendant notice of default by a letter of 29.3.2010 informing the 1st Defendant that the 1st Plaintiff was not in a position to effect settlement in full or in part on the ABA. This letter by the 1st Plaintiff is exhibited as Exhibit YHH-9 in the 1st Defendant's affidavit in reply. The letter was short and crisp. It reads:
"we refer to the abovemention subject and your fax of today on the Event of Default by ourselves on the BAiDS terms. Malaysian Merchant Marine Berhad is not in a position to effect settlement in part or full, on the BAiDs."

The letter was signed by one Dato' Ramesh Rajaratnam, Executive Deputy Chairman of the 1st Plaintiff who also affirmed the 1st Plaintiff's affidavit in support in this case. Subsequently on 30.3.2010, the 1st Plaintiff also made an announcement [as in 1st Defendant's Exhibit YHH-10 in 1st Defendant's affidavit in reply] to the Bursa Malaysia declaring that the 1st Plaintiff did not have the cash-flow to pay the ABA (or BaiDS) as demanded under the notice of default or any measures to address the default. In the same announcement, the 1st Plaintiff also admitted that it would not be able to pay its debt as and when they fall due. Under Clause 10.1 of the 1st and 2nd debentures the secured amount under the facilities granted to the 1st Plaintiff shall become due and immediately repayable if the 1st Plaintiff ie the issuer defaulted in the payment to the security trustee of any secured amounts when it become due whether formally demanded or not upon the occurrence of any event of default under the Trust Deed or the security documents. And, under Clause 11.2 of the debentures the security trustee ie the 1st Defendant is empowered upon service of default notice on the 1st Plaintiff to board, enter and take possession over the mortgaged securities [in this case the two ships The Dayton and The Kingston]. Further, under Clause 12.1 of the debentures the security trustee may appoint Receivers over the two ships at any time after the service of the notice of occurrence of default. Pursuant to this clause the 1st Defendant by deed of appointment dated 3.4.2010 appointed the 3rd and 4th Defendant as Receivers over The Kingston and by deed of appointment dated 6.4.2010 appointed the 3rd and 4th Defendant as Receivers for The Dayton. Under Clause 12.6 of the debentures the 3rd and 4th Defendant as Receivers have full powers and in their absolute discretion to do the following acts : (a) (b) (c) (d) to take possession, get in and collect the two ships and to exercise all powers in relation to the two ships; to sell or dispose the two ships; to appoint employees to manage the two ships and to insure, repair, improve, modify, refurbish, exploit and develop the two ships.

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The Application The Plaintiffs subsequently filed the writ of summons and statement of claim in Enclosure 1 seeking various orders inter alia a declaration that the 3rd and 4th Defendant appointment as the Receivers and accounting agents for the two ships as null and void and for injunctive orders to restrain the 3rd and 4th Defendant from carrying out their duties as Receivers and Managers for the two ships including to restrain them from dealing with the two ships. After the filing of the writ the Plaintiffs also filed Enclosure 2 which is an ex parte application for interlocutory injunction to restrain the 3rd and 4th Defendant from carrying out their duties as Receivers and Managers for the two ships. This was done on 3.5.2010. The main argument by the Plaintiff in Enclosure 2 is that the appointment of the Receivers and Managers is not valid because Form 59 was not lodged with the Companies Commission of Malaysia [CCM] before the Receivers began to carry out his duties to take possession of the ships. It was also argued that the appointment was done on Saturday, which is a public holiday. I granted the Plaintiff's ex parte application for injunction on 4.5.2010 and fixed the matter for inter parties hearing on 17.5.2010. In the meantime, the 1st Defendant filed Summons in Chambers in Enclosure 7 to set aside the ex parte injunction. The 2nd to 4th Defendant filed similar Summons in Chambers application in Enclosure 10. On 17.5.2010 I heard the parties in respect of all 3 enclosures namely Enclosures 2, 7 and 10 inter partes and at the end of the hearing I allowed the Defendants application in Enclosure 7 and 10 to set aside the ex parte injunction and dismissed Enclosure 2. Accordingly, I also set aside the ex parte injunction granted on 4.5.2010 and ordered that damages to the Defendants be assessed by the registrar. I also ordered the Plaintiff to pay costs to the Defendants with costs to be taxed. Learned counsel for the 1st Defendant submitted that there is no law to say that a Receiver cannot be appointed on Saturday or during a public holiday. Under the debentures created by the Plaintiffs in favour of the 1st Defendant the appointment of the Receiver is to be made by a Deed of Appointment as exhibited in Exhibit A-3 in Enclosure 11. This power of appointment is provided in Clause 12.1 of the debentures and the clause reads :
"At any time after a default Notice has been served on the Issuer, the security trustee may by deed appoint such person or persons not precluded under the provisions of the Companies Act, 1965 and as it thinks fir to be the Receiver of the Charged asset to act jointly or severally."

There is nothing in Clause 12 of the debentures that stipulates the time or day when a Receiver can or cannot be appointed by the security trustee. Thus the document to look at to determine validity is in the deed; and not FORM 59 which is only a notice of appointment. Under section 186(1) of the Companies Act 1965 a person who appoints a Receiver or Manager is required to lodge a notice of such appointment with the Registrar of Companies within 7 days after he has made the appointment. Though section 186(3) makes it an offence for non compliance with this requirement, there is nothing in section 186 of the Act that nullifies the appointment if the notice is not lodged within the specified time period. Thus from the language used in Section 186 of the Act it appears to me that the lodgment of the notice of appointment is directory and not mandatory. Therefore the delay in lodging the notice does not invalidate the appointment of the Receiver or Manager appointed by the security trustee in this case pursuant to the power given under Cause 12 of the debenture. This situation is to be differentiated from that of a liquidator who must provide security before acting. As for the letter notifying the appointment, which the Plaintiff argued was sent to the Plaintiffs only very much later, it could only be sent after the appointment had been made. Therefore, on the validity of the appointment of the 3rd and 4th Defendants as Receivers by the 1st

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Defendant, my view is that there is no triable issue. There is also material non-disclosure of material facts by the Plaintiff in the affidavit supporting the ex parte application for injunction. The 2nd and 3rd Plaintiff created debentures and legal mortgages over the two ships. There was a default notice. The 1st Plaintiff made an announcement on Bursa website on its financial status and this announcement was not exhibited or disclosed to the Court. In the announcement, Plaintiff says the credit rating of the bond was down-rated and they cannot afford to pay the loan because of cash-flow problem and the 1st Plaintiff was unable to meet the demand for repayment. Subsequently Notice of Event of Default was given to Plaintiff on 1.4.2020. Once there is event of default, the security trustee can appoint a Receiver under the debenture. This was also not disclosed. It was also not disclosed that under the debentures Default notice is only required to be issued to 1st Plaintiff. The Plaintiff also did not disclose that under the 1st and 2nd debenture respectively, the Receiver appointed by the Defendant need to immediately take possession of the two ships - The Kingston and The Dayton. This is to ensure that the mortgage property ie the ships is preserved for the benefit of the 1st Defendant. The Notice of the Appointment of Receiver to the Plaintiff cannot be an afterthought as alleged by the Plaintiffs. The notice on The Kingston was lodged on Monday ie 5.4.2020 before the 7 day period for the lodgment of the notice expires. In fact it was lodge even before the Plaintiff's complaint. The second notice on The Dayton was lodged on 13.4.2010 also within 7 days. After appointment of Receiver over The Kingston, 1st Plaintiff announced on Bursa website that The Kingston was de-commissioned on February 2010 and that the vessel also has been declassified. In the announcement, the 1st Plaintiff stated the present netbook value of the vessel was RM 200,000.00-500,000.00 and scrap yard value is USD 200,000.00-250,000.00. So the vessel is worthless. Similarly, for the vessel The Dayton, announcement was also made that it was de- commissioned end of 2009; and was valued as scrap at USD 60,000.00. These were not disclosed in the ex parte application. Further non-disclosure includes the fact that the 1st Plaintiff is listed as PN 17 by the Bursa. Plaintiff also did not disclose that the ships were not insured at the date of ex parte order. Until today, the ships are not insured. The obligation to insure the ships are the owners. The basic principle that governs full and frank disclosure in an ex parte application is that the party applying for such order must disclose material fact that the Judge hearing the application need to know that may persuade the Judge to grant or not to grant the ex parte application order sought. The materiality of the facts to be disclosed is a matter for the Court to decide and not what the applicant or his legal advisers think to be material. This principle was stated succinctly by Ralp Gibson LJ in Brink's - MAT Ltd v Elcombe and Others [1988] 3 All ER 188 at page 192 as follows:
"In considering whether there has been relevant non-disclosure and what consequence the Court should attach to any failure to comply with the duty to make full and frank disclosure, the principles relevant to the issues in these appeals appear to me to include the following. (i) The duty of the applicant is to make 'a full and fir disclosure of all the material facts' : see R v Kensington Income tax Comrs, ex Plaintiff Princess Edmond de Polignac [1917] 1 KB 486 at 514 per Scrutton LJ. (ii) The material facts are those which it is material for the judge to know in dealing with the application as made; materiality is to be decided by the Court and not by the assessment of the applicant or his legal advisers : see the Kensington Income Tax Comrs case [1917] 1 KB 486 at 504 per Lord Cozens-Hardy MR, citing Dalglish v Jarvie (1850) 2 Mac & G 231 at 92 42 ER 89, and Thermax Ltd v Schott Industrial Glass Ltd [1981] FSR 289 at 295 per Browne-Wilkinson J. (iii) The applicant must make proper inquiries before making the application : see Bank Mellat v Nikpour [1985] FSR 87. The duty of disclosure therefore applies not only to material facts known to the applicant but also to any additional facts which he would have known if he had made such inquiries. (iv) The extent of the inquiries which will be held to be proper, and therefore necessary, must depend on all the circumstances of the case including (a) the nature of the case which the applicant is making when he makes the application, (b) the order of which application is made and the probable effect of the order on the Defendant : see, for example, the examination by Scott J of the possible effect of an Anton Piller order in Columbia Picture Industries Inc v Robinson [1986] 3 All ER 338; [1987] Ch 38, and (c) the degree of legitimate urgency and the time available for the making of inquiries : see Bank Mellat v Nikpour [1985] FSR 87 at 92-93 per Slade LJ. (v) If material non-disclosure is established the Court will be 'astute to ensure that a Plaintiff who obtains ... an ex parte injunction without full disclosure is deprived of any advantage he may have derived by that breach of duty ...' : see Bank Mellat v Nikpour, citing Warrington LJ in the

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Kensington Income Tax Comrs case. (vi) Whether the fact not disclosed is of sufficient materiality to justify or require immediate discharge of the order without examination of the merits depends on the importance of the fact to the issues which were to be decided by the judge on the application. The answer to the question whether the non-disclosure was innocent, in the sense that the fact was not known to the applicant or that its relevance was not perceived, is an important consideration but not decisive by reason of the duty on the applicant to make all proper inquiries and to give careful consideration to the case being presented."

However, this does not necessarily mean that in every case where there is material non-disclosure but it was omitted innocently the Court may exercise discretion not to discharge the ex parte injunction order. This appears to be so from the passage in the same case by the same Judge which reads as follows:
"(vii) Finally 'it is not for every omission that the injunction will be automatically discharged. A locus poenitentiae may sometimes be afforded' : see Bank Mellat v Nikpour [1985] FSR 87 at 90 per Lord Denning MR. The Court has a discretion, notwithstanding proof of material non-disclosure which justifies or requires the immediate discharge of the ex parte order, nevertheless to continue the order, or to make a new order on terms: '... when the whole of the facts, including that of the original non-disclosure, are before it, [the Court] may well grant such a second injunction if the original non-disclosure was innocent and if an injunction could properly be granted even had the facts been disclosed."

But in an ex parte application for interim injunction the applicant also has a special duty to disclose all matters within his knowledge that are material to the proceedings. In Castle Fitness Consultancy Pte Ltd v Manz [1990] 1 MLJ 141 a case decided by Singapore High Court, Coomaraswamy J, at pg. 144 states this special duty in the following terms:
"Special duties arises when an application for an ex parte interim injunction is made. Where an ex parte application is made, the Plaintiff is obliged not only not to mislead the Court but in addition, he is under a duty to disclose to the Court all matters which are within his knowledge which are material to the proceedings and which are or may be in favour of an absent party. A matter as regarded as material it is is a factor that the Court will take into account in the exercise of its discretion."

The 1st Defendant also deposed in the affidavit that after the Receiver had taken possession of the ships and had the ships advertised for sale. Prior to that, the Receiver had to incur expenses in finding and paying for new set of crews for the ships and also to restore the generator in the ships to operational status. There is also non compliance with O. 29 r1(2A) and r1(2BA). In respect of O.29 r1(2A), the Plaintiffs' affidavit in support does not contain any clear statement of the matters sought by the rule under sub-paragraph (c) and (e). Under these two paragraphs the applicant is required to state in the affidavit the facts relied on to justify the ex parte application including details of any notice given to the Defendants and if none is given the reason for not giving none and of any facts known to the applicant which may lead the Court not to grant relief ex-parte. This is a nutshell the principle for full and frank disclosure. The Plaintiff was aware that the 1st Defendant was represented by solicitors Shearn Delamore & Co. This is evident from Exhibit M-9 in the Plaintiff's affidavit in support, which the 1st Defendant solicitors' letter to the Plaintiffs' solicitors requesting the Plaintiffs to give the 1st Defendant an advance notice of 48 hours of any intended application to be filed by the 1st Plaintiff. However, the Plaintiff proceeded to file the ex parte application without any notice to the 1st Defendant or its solicitors. Such omission by the Plaintiffs is clear breach of the rule and obvious non compliance : Datuk James Wong Kim Min & Anor v Dato Seri Peter Tinggom Kamarau & Ors [2003] 6 CLJ 381 389. In respect of O 29 r1(2BA), the Plaintiff has failed to serve the sealed copy of the ex parte injunction Order obtained on 4.5.2010 within one week of the order on the Defendant as required by the rule. Compliance with this rule has been held mandatory and any breach of it is fatal to the applicant. This is because the inter partes hearing of an ex parte injunction is fixed by the rule to be held before the expiry of 21 days from the date of the ex parte Order. Thus, it is implicit in the rule that delay will not be tolerated. Therefore it is imperative that the Plaintiff served the ex parte Order within one week from the date it is obtained : Cheah Cheng Lan v Heng Yea Lee [2001] 1 MLJ 433. In this instant case even till the date of inter partes hearing not even a draft Order of the ex parte Order obtained by the Plaintiff on 4.5.2010 was served on the

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Defendants. This fact is not denied by the Plaintiff. As for the 2nd Plaintiff, it is company registered in Panama. It has no record whatsoever with CCM, Malaysia. Its only asset within jurisdiction is the ship The Kingston. However the debenture that was created over the ship was governed by Malaysian law. So, there is no strict requirement to lodge the notice of the appointment of the Receiver. The Defendants submitted that they did so only out of abundance of caution. Therefore, in so far as the lodgment of the notice of appointment to validate the appointment of the Receiver, I agree with the submissions by the learned counsels for the Defendants that there is no serious issue to be tried. There is no necessity to lodge notice of appointment with CCM before the Receiver can act under the Deed of Appointment. The 2nd Defendant has nothing to do with the present application. It is a Firm and not a registered company. So the Defendants submitted that no injunction should be granted against 2nd Defendant. The Defendants further submitted that if damages is adequate remedy, the injunction ought not to be granted. And it was submitted that in the instant case here damages is more than adequate remedy for the Plaintiffs. However, as for Plaintiffs' ability to meet damages suffered by the Defendants arising from the injunction it was submitted that damages are not adequate remedy. It was argued and shown that though the ships were mortgaged to the 1st Defendant, the ships are of little value. And that the Plaintiffs by their own admission is insolvent. Thus, it was submitted that the Plaintiffs are in no position to pay damages to the Defendants. Accordingly, it was submitted that the undertaking by Plaintiffs as to damages is not worth the paper it is written on. On the evidence in the affidavits filed in this application, I agree with this submissions. The law to be applied in hearing interlocutory injunction has been settled and summarized by the Court of Appeal in Keet Gerald Francis Noel John v Mohd Noor @ Harun bin Abdullah & 2 Ors [1995]1 AMR 373 390. First and foremost the Court must remember that the remedy it is about to give is a discretionary remedy 'intended to produce a just result' and to maintain the status quo for the interim period until the trial proper. Therefore, the Court is entitled to take into account all discretionary considerations in order to arrive at the just result. Then the Court must be satisfied that on the totality of facts and evidence before it (bearing in mind that at this stage pleadings and evidence may be incomplete) whether there is a bona fide serious issue to be tried. Having found one, the Court then must consider where the justice of the case lies. This were the consideration whether damages is an adequate remedy or not comes in. Sometimes this is also referred to as the balance of convenience in the case. On this last consideration in this instant case, I am of the view that on the totality of the facts before me the balance of convenience favours the Defendant. This is so despite the fact that I find no triable issue in this instant case and I need not decide on this issue. However I do so for the sake of completeness. The 3rd and 4th Defendants as Receivers have shown in their affidavits in reply [in Enclosure 11] to oppose the ex parte injunction that the two ships The Kingston and The Dayton were in bad shape physically since their decommissioning date in February 2010 and end of 2009 respectively. The 3rd and 4th Defendant has stated in the affidavit [paragraphs 37 to 45] that the two ships were unable to be run economically without incurring significant upgrading works and the Receivers have incurred substantial sums on the two ships to maintain their, I would say, marketable condition. The Defendants have exhibited Exhibit A-10 the summary of invoices received by the Receivers for the amount already incurred expended on the two ships. Furthermore as the two ships were mortgaged the 1st Defendant as security for the loan facility granted to the Plaintiffs it is imperative that the two ships be put up for sale to reduce the amount owing by the Plaintiffs to the 1st Defendant before the condition of the two ships deteriorated further. To this end the Receivers has advertised the sale of the two ships and a sum of RM 18,710.06 as shown in Exhibit A-11 was incurred as advertisement cost. Thus if the ex parte injunction is allowed to continue to stand more inconvenience would be caused to the 1st Defendant as the latter would have to incur more costs to maintain the two ships which have been decommissioned by the Plaintiffs. The Court was also informed by learned counsel for the 1st Defendant that the 3rd Plaintiff is a

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non-existence company. There is no record of the company filed with SSM. The named 3rd Defendant are not owners of The Kingston. The legal owner is Splendid Eminent Sdn Bhd. This fact was never disclosed. It was also alleged that the deponent of the Plaintiff affidavit in support [in Enclosure 3] has no authority to affirm the affidavit for 1st Plaintiff in his capacity as Executive Deputy Chairman of the 1st Plaintiff. The deponent of the 1st Plaintiff's affidavit in support, Dato' Ramesh, had commenced an action against the 1st Plaintiff in Shah Alam High Court in Suit No. 22-382-2010 where he alleged that his contract of employment with the 1st Plaintiff had been prematurely terminated by the 1st Plaintiff on 16.3.2010. The 1st Plaintiff's affidavit in support was affirmed by Dato' Ramesh on 30.4.2010. Therefore, it is obvious that at the time he affirmed the affidavit he was not longer the Executive Deputy Chairman of the 1st Plaintiff. For the above reasons, I order as follows: Enclosure 2 is dismissed with costs and damages to be assessed by registrar. Enclosure 7 and 10 allowed with costs and damages to be assessed by registrar and the ex parte injunction is set aside. Costs in all the applications to be paid forthwith after taxation.

Malayan Law Journal Unreported/2010/Volume /MALAYSIAN MERCHANT MARINE BERHAD & ORS V BHLB TRUSTEE BERHAD & ORS - [2010] MLJU 1171 - 17 May 2010 [2010] MLJU 1171

MALAYSIAN MERCHANT MARINE BERHAD & ORS V BHLB TRUSTEE BERHAD & ORS
HIGH COURT (KUALA LUMPUR) ABDUL AZIZ BIN ABDUL RAHIM, J NO D22-NCC-860-2010 17 May 2010 Pramjit Singh (Lai Jin Shawn with him) (Messrs. Harjit Sandhu), G. Rajasingam (Alvin Julian and En. Mohd Shahrul Fazli with him) (Messrs. Shearn Delamore & Co), Wong Chee Lin (Miss Patricia Ng with him) (Messrs. Skrine) ABDUL AZIZ BIN ABDUL RAHIM, J GROUNDS OF JUDGMENT [Enclosure 2, 7 and 10] The parties [1] The 1st and 2nd Plaintiffs are Malaysian companies with registered and service addresses in Malaysia. The 3rd Plaintiff is a foreign company incorporated in the Republic of Panama with the registered address in Panama City, Republic of Panama; however,the 3rd Plaintiff also has a service address in Malaysia. The 2nd and 3rd Plaintiffs are also wholly owned subsidiaries of the 1st Plaintiff. The 1st Plaintiff is public listed company listed on the Main Market of Bursa Malaysia Securities Berhad. [2] The 2nd Plaintiff is the owner of the ship "MMM Dayton" ["The Dayton"] which was registered in Panama and the 3rd Plaintiff is owner of the ship "MMM Kingston" ["The Kingston"]. The 1st Plaintiff was given the full authority to manage the business of the two ships. [3] The 1st Defendant is a Malaysian company and the 1st Defendant has granted to the 1st Plaintiff certain facilities and the 1st Defendant also act as the security trustee under two debentures created by the Plaintiffs pursuant to the grant of the facilities by the 1st Defendant. [4] The 2nd Defendant is an established local accounting and auditing firm with address of service in

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Malaysia. The 3rd and 4th Defendant are the partners in the 2nd Defendant. The 3rd and 4th Defendant have been appointed, under the debentures, as Receivers and Managers for the two ships - The Dayton and The Kingston. The background facts [5] The 1st Plaintiff had entered into a issuance facilities agreement dated 18.11.2003 [Exhibit M-3 in the Plaintiff's 1st affidavit] whereby the 1st Plaintiff was the issuer of Islamic debt securities totaling a nominal value of RM 159,435,000.00 under the Syariah principle of Al-Bai'bithaman Ajil ['ABA']. The beneficiary holder of the ABA is the EPF. [6] The securities for the amount payable by the 1st Plaintiff are : firstly a debenture dated 28.2.2005 executed by the 1st and 2nd Plaintiff and 1st Defendant [the 1st debenture - Exhibit A-1 of the 1st Defendant's 1st affidavit] under which the 2nd Plaintiff charged the ship The Dayton as first fixed charge in favour of the 1st Defendant. Secondly, the 1st and the 3rd Plaintiff and the 1st Defendant executed a second debenture dated 16.8.2006 [also Exhibit A-1] under which the 3rd Plaintiff charged the ship The Kingston as first fixed charge in favour of the 1st Defendant. Thirdly, the 2nd and 3rd Plaintiff also executed legal mortgages over the ships The Dayton and The Kingston which were registered in the relevant shipping registries. The legal mortgage over The Dayton was registered at the Public Registry of Panama and the legal mortgage over The Kingston was registered at the Office of the Registrar of Malaysian Ships, at Port Klang, Malaysia. [7] Pursuant to the securities arrangement as above, the 1st Plaintiff entered into a Trust Deed [Exhibit YHH-6 in 1st Defendant's affidavit in reply] with the 1st Defendant on 18.11.2003. Under Clause 9.1(u) of the Trust Deed an event of default occurs when the rating of the ABA by Malaysian Rating Corporation Berhad falls below the rating of BBB. [8] In this case, the ABA rating did fall below the rating of BBB. As a result thereof the 1st Defendant issued a notice of occurrence of an event of default dated 29.3.2010 to the 1st Plaintiff pursuant to Clause 9.1 of the Trust Deed. At the time the notice of default was issued, the rating of the ABA had been downgraded by the Malaysian Rating Corporation to BB+ID. This is evident in paragraph 19 of the 1st Defendant's affidavit and also in Exhibit M-4 in the Plaintiffs' affidavit. [9] The 1st Plaintiff responded to the 1st Defendant notice of default by a letter of 29.3.2010 informing the 1st Defendant that the 1st Plaintiff was not in a position to effect settlement in full or in part on the ABA. This letter by the 1st Plaintiff is exhibited as Exhibit YHH-9 in the 1st Defendant's affidavit in reply. The letter was short and crisp. It reads:
"we refer to the abovemention subject and your fax of today on the Event of Default by ourselves on the BAiDS terms. Malaysian Merchant Marine Berhad is not in a position to effect settlement in part or full, on the BAiDs."

[10] The letter was signed by one Dato' Ramesh Rajaratnam, Executive Deputy Chairman of the 1st Plaintiff who also affirmed the 1st Plaintiff's affidavit in support in this case. [11] Subsequently on 30.3.2010, the 1st Plaintiff also made an announcement [as in 1st Defendant's Exhibit YHH-10 in 1st Defendant's affidavit in reply] to the Bursa Malaysia declaring that the 1st Plaintiff did not have the cash-flow to pay the ABA (or BaiDS) as demanded under the notice of default or any measures to address the default. In the same announcement, the 1st Plaintiff also admitted that it would not be able to pay its debt as and when they fall due. [12] Under Clause 10.1 of the 1st and 2nd debentures the secured amount under the facilities granted to the 1st Plaintiff shall become due and immediately repayable if the 1st Plaintiff ie the issuer defaulted in the payment to the security trustee of any secured amounts when it become due whether formally demanded or not upon the occurrence of any event of default under the Trust Deed or the security documents.

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[13] And, under Clause 11.2 of the debentures the security trustee ie the 1st Defendant is empowered upon service of default notice on the 1st Plaintiff to board, enter and take possession over the mortgaged securities [in this case the two ships The Dayton and The Kingston]. Further, under Clause 12.1 of the debentures the security trustee may appoint Receivers over the two ships at any time after the service of the notice of occurrence of default. Pursuant to this clause the 1st Defendant by deed of appointment dated 3.4.2010 appointed the 3rd and 4th Defendant as Receivers over The Kingston and by deed of appointment dated 6.4.2010 appointed the 3rd and 4th Defendant as Receivers for The Dayton. [14] 14. Under Clause 12.6 of the debentures the 3rd and 4th Defendant as Receivers have full powers and in their absolute discretion to do the following acts : (a) to take possession, get in and collect the two ships and to exercise all powers in relation to the two ships; (b) to sell or dispose the two ships; (c) to appoint employees to manage the two ships and (d) to insure, repair, improve, modify, refurbish, exploit and develop the two ships. The Application [15] The Plaintiffs subsequently filed the writ of summons and statement of claim in Enclosure 1 seeking various orders inter alia a declaration that the 3rd and 4th Defendant appointment as the Receivers and accounting agents for the two ships as null and void and for injunctive orders to restrain the 3rd and 4th Defendant from carrying out their duties as Receivers and Managers for the two ships including to restrain them from dealing with the two ships. [16] After the filing of the writ the Plaintiffs also filed Enclosure 2 which is an ex parte application for interlocutory injunction to restrain the 3rd and 4th Defendant from carrying out their duties as Receivers and Managers for the two ships. This was done on 3.5.2010. [17] The main argument by the Plaintiff in Enclosure 2 is that the appointment of the Receivers and Managers is not valid because Form 59 was not lodged with the Companies Commission of Malaysia [CCM] before the Receivers began to carry out his duties to take possession of the ships. It was also argued that the appointment was done on Saturday, which is a public holiday. [18] I granted the Plaintiff's ex parte application for injunction on 4.5.2010 and fixed the matter for inter parties hearing on 17.5.2010. In the meantime, the 1st Defendant filed Summons in Chambers in Enclosure 7 to set aside the ex parte injunction. The 2nd to 4th Defendant filed similar Summons in Chambers application in Enclosure 10. [19] On 17.5.2010 I heard the parties in respect of all 3 enclosures namely Enclosures 2, 7 and 10 inter partes and at the end of the hearing I allowed the Defendants application in Enclosure 7 and 10 to set aside the ex parte injunction and dismissed Enclosure 2. Accordingly, I also set aside the ex parte injunction granted on 4.5.2010 and ordered that damages to the Defendants be assessed by the registrar. I also ordered the Plaintiff to pay costs to the Defendants with costs to be taxed. [20] 20. Learned counsel for the 1st Defendant submitted that there is no law to say that a Receiver cannot be appointed on Saturday or during a public holiday. Under the debentures created by the Plaintiffs in favour of the 1st Defendant the appointment of the Receiver is to be made by a Deed of Appointment as exhibited in Exhibit A-3 in Enclosure 11. This power of appointment is provided in Clause 12.1 of the debentures and the clause reads : "At any time after a default Notice has been served on the Issuer, the security trustee may by deed appoint such person or persons not precluded under the provisions of the Companies Act, 1965 and as it thinks fir to be the Receiver of the Charged asset to act jointly or severally.". [21] There is nothing in Clause 12 of the debentures that stipulates the time or day when a Receiver can or cannot be appointed by the security trustee. Thus the document to look at to determine validity is in the deed; and not FORM 59 which is only a notice of appointment. [22] Under section 186(1) of the Companies Act 1965 a person who appoints a Receiver or Manager is required to lodge a notice of such appointment with the Registrar of Companies within 7 days after he has made the appointment. Though section 186(3) makes it an offence for non compliance with this requirement,

Page 10

there is nothing in section 186 of the Act that nullifies the appointment if the notice is not lodged within the specified time period. Thus from the language used in Section 186 of the Act it appears to me that the lodgment of the notice of appointment is directory and not mandatory. Therefore the delay in lodging the notice does not invalidate the appointment of the Receiver or Manager appointed by the security trustee in this case pursuant to the power given under Cause 12 of the debenture. This situation is to be differentiated from that of a liquidator who must provide security before acting. [23] As for the letter notifying the appointment, which the Plaintiff argued was sent to the Plaintiffs only very much later, it could only be sent after the appointment had been made. [24] Therefore, on the validity of the appointment of the 3rd and 4th Defendants as Receivers by the 1st Defendant, my view is that there is no triable issue. [25] There is also material non-disclosure of material facts by the Plaintiff in the affidavit supporting the ex parte application for injunction. The 2nd and 3rd Plaintiff created debentures and legal mortgages over the two ships. There was a default notice. The 1st Plaintiff made an announcement on Bursa website on its financial status and this announcement was not exhibited or disclosed to the Court. In the announcement, Plaintiff says the credit rating of the bond was down-rated and they cannot afford to pay the loan because of cash-flow problem and the 1st Plaintiff was unable to meet the demand for repayment. [26] Subsequently Notice of Event of Default was given to Plaintiff on 1.4.2020. Once there is event of default, the security trustee can appoint a Receiver under the debenture. This was also not disclosed. It was also not disclosed that under the debentures Default notice is only required to be issued to 1st Plaintiff. [27] The Plaintiff also did not disclose that under the 1st and 2nd debenture respectively, the Receiver appointed by the Defendant need to immediately take possession of the two ships - The Kingston and The Dayton. This is to ensure that the mortgage property ie the ships is preserved for the benefit of the 1st Defendant. [28] The Notice of the Appointment of Receiver to the Plaintiff cannot be an afterthought as alleged by the Plaintiffs. The notice on The Kingston was lodged on Monday ie 5.4.2020 before the 7 day period for the lodgment of the notice expires. In fact it was lodge even before the Plaintiff's complaint. The second notice on The Dayton was lodged on 13.4.2010 also within 7 days. [29] After appointment of Receiver over The Kingston, 1st Plaintiff announced on Bursa website that The Kingston was decommissioned on February 2010 and that the vessel also has been declassified. In the announcement, the 1st Plaintiff stated the present netbook value of the vessel was RM 200,000.00-500,000.00 and scrap yard value is USD 200,000.00-250,000.00. So the vessel is worthless. [30] Similarly, for the vessel The Dayton, announcement was also made that it was de- commissioned end of 2009; and was valued as scrap at USD 60,000.00. These were not disclosed in the ex parte application. [31] . Further non-disclosure includes the fact that the 1st Plaintiff is listed as PN 17 by the Bursa. Plaintiff also did not disclose that the ships were not insured at the date of ex parte order. Until today, the ships are not insured. The obligation to insure the ships are the owners. [32] 32. The basic principle that governs full and frank disclosure in an ex parte application is that the party applying for such order must disclose material fact that the Judge hearing the application need to know that may persuade the Judge to grant or not to grant the ex parte application order sought. The materiality of the facts to be disclosed is a matter for the Court to decide and not what the applicant or his legal advisers think to be material. This principle was stated succinctly by Ralp Gibson LJ in Brink's - MAT Ltd v Elcombe and Others [1988] 3 All ER 188 at page 192 as follows:
"In considering whether there has been relevant non-disclosure and what consequence the Court should attach to any failure to comply with the duty to make full and frank disclosure, the principles relevant to the issues in these appeals appear to me to include the following, (i) The duty of the applicant is to make 'a full and fir disclosure of all the material facts' : see R v Kensington Income tax Comrs, ex Plaintiff Princess Edmond de Polignac [1917] 1 KB 486 at 514 per

Page 11

Scrutton LJ. (ii) The material facts are those which it is material for the judge to know in dealing with the application as made; materiality is to be decided by the Court and not by the assessment of the applicant or his legal advisers : see the Kensington Income Tax Comrs case [1917] 1 KB 486 at 504 per Lord Cozens-Hardy MR, citing Dalglish v Jarvie (1850) 2 Mac & G 231 42 ER 89 at 92, and Thermax Ltd v Schott Industrial Glass Ltd [1981] FSR 289 at 295 per Browne-Wilkinson J. (Hi) The applicant must make proper inquiries before making the application : see Bank Mellat v Nikpour [1985] FSR 87. The duty of disclosure therefore applies not only to material facts known to the applicant but also to any additional facts which he would have known if he had made such inquiries, (iv) The extent of the inquiries which will be held to be proper, and therefore necessary, must depend on all the circumstances of the case including (a) the nature of the case which the applicant is making when he makes the application, (b) the order of which application is made and the probable effect of the order on the Defendant: see, for example, the examination by Scott J of the possible effect of an Anton Piller order in Columbia Picture Industries Inc v Robinson [1986] 3 All ER 338; [1987] Ch 38, and (c) the degree of legitimate urgency and the time available for the making of inquiries : see Bank Mellat v Nikpour [1985] FSR 87 at 92-93 per Slade LJ. (v) If material non-disclosure is established the Court will be 'astute to ensure that a Plaintiff who obtains... an ex parte injunction without full disclosure is deprived of any advantage he may have derived by that breach of duty...': see Bank Mellat v Nikpour (at 91) per Donaldson LJ, citing Warrington LJ in the Kensington Income Tax Comrs case, (vi) Whether the fact not disclosed is of sufficient materiality to justify or require immediate discharge of the order without examination of the merits depends on the importance of the fact to the issues which were to be decided by the judge on the application. The answer to the question whether the non-disclosure was innocent, in the sense that the fact was not known to the applicant or that its relevance was not perceived, is an important consideration but not decisive by reason of the duty on the applicant to make all proper inquiries and to give careful consideration to the case being presented."

However, this does not necessarily mean that in every case where there is material non-disclosure but it was omitted innocently the Court may exercise discretion not to discharge the ex parte injunction order. This appears to be so from the passage in the same case by the same Judge which reads as follows:
"(vii) Finally 'it is not for every omission that the injunction will be automatically discharged. A locus poenitentiae may sometimes be afforded': see Bank Mellat v Nikpour [1985] FSR 87 at 90 per Lord Denning MR. The Court has a discretion, notwithstanding proof of material non-disclosure which justifies or requires the immediate discharge of the ex parte order, nevertheless to continue the order, or to make a new order on terms: "... when the whole of the facts, including that of the original non-disclosure, are before it, [the Court] may well grant such a second injunction if the original nondisclosure was innocent and if an injunction could properly be granted even had the facts been disclosed."

[33] But in an ex parte application for interim injunction the applicant also has a special duty to disclose all matters within his knowledge that are material to the proceedings. In Castle Fitness Consultancy Pte Ltd v Manz [1990] 1 MLJ 141, a case decided by Singapore High Court, Coomaraswamy J, at pg. 144 states this special duty in the following terms:
"Special duties arises when an application for an ex parte interim injunction is made. Where an ex parte application is made, the Plaintiff is obliged not only not to mislead the Court but in addition, he is under a duty to disclose to the Court all matters which are within his knowledge which are material to the proceedings and which are or may be in favour of an absent party. A matter as regarded as material it is is a factor that the Court will take into account in the exercise of its discretion."

[34] The 1st Defendant also deposed in the affidavit that after the Receiver had taken possession of the ships and had the ships advertised for sale. Prior to that, the Receiver had to incur expenses in finding and paying for new set of crews for the ships and also to restore the generator in the ships to operational status. [35] There is also non compliance with O. 29 r1(2A) and r1(2BA). In respect of 0.29 r1(2A), the Plaintiffs' affidavit in support does not contain any clear statement of the matters sought by the rule under sub-paragraph (c) and (e). Under these two paragraphs the applicant is required to state in the affidavit the facts relied on to justify the ex parte application including details of any notice given to the Defendants and if none is given the reason for not giving none and of any facts known to the applicant which may lead the Court not to grant relief ex-parte. This is a nutshell the principle for full and frank disclosure. The Plaintiff was aware that the 1st Defendant was represented by solicitors Shearn Delamore & Co. This is evident from Exhibit M-9 in the Plaintiff's affidavit in support, which the 1st Defendant solicitors' letter to the Plaintiffs' solicitors requesting the Plaintiffs to give the 1st Defendant an advance notice of 48 hours of any intended application to be filed by the 1st Plaintiff. However, the Plaintiff proceeded to file the ex parte application

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without any notice to the 1 Defendant or its solicitors. Such omission by the Plaintiffs is clear breach of the rule and obvious non compliance : Datuk James Wong Kim Min & Anor v Dato Seri Peter Tinggom Kamarau & Ors [2003] 6 CLJ 381 389. [36] In respect of O 29 r1(2BA), the Plaintiff has failed to serve the sealed copy of the ex parte injunction Order obtained on 4.5.2010 within one week of the order on the Defendant as required by the rule. Compliance with this rule has been held mandatory and any breach of it is fatal to the applicant. This is because the inter partes hearing of an ex parte injunction is fixed by the rule to be held before the expiry of 21 days from the date of the ex parte Order. Thus, it is implicit in the rule that delay will not be tolerated. Therefore it is imperative that the Plaintiff served the ex parte Order within one week from the date it is obtained : Cheah Cheng Lan v Heng Yea Lee [2001] 1 MLJ 433. In this instant case even till the date of inter partes hearing not even a draft Order of the ex parte Order obtained by the Plaintiff on 4.5.2010 was served on the Defendants. This fact is not denied by the Plaintiff. [37] As for the 2nd Plaintiff, it is company registered in Panama. It has no record whatsoever with CCM, Malaysia. Its only asset within jurisdiction is the ship The Kingston. However the debenture that was created over the ship was governed by Malaysian law. So, there is no strict requirement to lodge the notice of the appointment of the Receiver. The Defendants submitted that they did so only out of abundance of caution [38] Therefore, in so far as the lodgment of the notice of appointment to validate the appointment of the Receiver, I agree with the submissions by the learned counsels for the Defendants that there is no serious issue to be tried. There is no necessity to lodge notice of appointment with CCM before the Receiver can act under the Deed of Appointment. [39] The 2nd Defendant has nothing to do with the present application. It is a Firm and not a registered company. So the Defendants submitted that no injunction should be granted against 2nd Defendant. [40] The Defendants further submitted that if damages is adequate remedy, the injunction ought not to be granted. And it was submitted that in the instant case here damages is more than adequate remedy for the Plaintiffs. [41] However, as for Plaintiffs' ability to meet damages suffered by the Defendants arising from the injunction it was submitted that damages are not adequate remedy. It was argued and shown that though the ships were mortgaged to the 1st Defendant, the ships are of little value. And that the Plaintiffs by their own admission is insolvent. Thus, it was submitted that the Plaintiffs are in no position to pay damages to the Defendants. Accordingly, it was submitted that the undertaking by Plaintiffs as to damages is not worth the paper it is written on. On the evidence in the affidavits filed in this application, I agree with this submissions. [42] The law to be applied in hearing interlocutory injunction has been settled and summarized by the Court of Appeal in Keet Gerald Francis Noel John v Mohd Noor @ Harun bin Abdullah & 2 Ors [1995]1 AMR 373 ; 390. First and foremost the Court must remember that the remedy it is about to give is a discretionary remedy 'intended to produce a just result' and to maintain the status quo for the interim period until the trial proper. Therefore, the Court is entitled to take into account all discretionary considerations in order to arrive at the just result. Then the Court must be satisfied that on the totality of facts and evidence before it (bearing in mind that at this stage pleadings and evidence may be incomplete) whether there is a bona fide serious issue to be tried. Having found one, the Court then must consider where the justice of the case lies. This were the consideration whether damages is an adequate remedy or not comes in. Sometimes this is also referred to as the balance of convenience in the case. [43] On this last consideration in this instant case, I am of the view that on the totality of the facts before me the balance of convenience favours the Defendant. This is so despite the fact that I find no triable issue in this instant case and I need not decide on this issue. However I do so for the sake of completeness. The 3rd and 4th Defendants as Receivers have shown in their affidavits in reply [in Enclosure 11] to oppose the ex parte injunction that the two ships The Kingston and The Dayton were in bad shape physically since their decommissioning date in February 2010 and end of 2009 respectively. The 3rd and 4th Defendant has stated in the affidavit [paragraphs 37 to 45] that the two ships were unable to be run economically without

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incurring significant upgrading works and the Receivers have incurred substantial sums on the two ships to maintain their, I would say, marketable condition. The Defendants have exhibited Exhibit A-10 the summary of invoices received by the Receivers for the amount already incurred expended on the two ships. Furthermore as the two ships were mortgaged the 1st Defendant as security for the loan facility granted to the Plaintiffs it is imperative that the two ships be put up for sale to reduce the amount owing by the Plaintiffs to the 1st Defendant before the condition of the two ships deteriorated further. To this end the Receivers has advertised the sale of the two ships and a sum of RM 18,710.06 as shown in Exhibit A-11 was incurred as advertisement cost. Thus if the ex parte injunction is allowed to continue to stand more inconvenience would be caused to the 1st Defendant as the latter would have to incur more costs to maintain the two ships which have been decommissioned by the Plaintiffs. [44] The Court was also informed by learned counsel for the 1st Defendant that the 3rd Plaintiff is a non-existence company. There is no record of the company filed with SSM. The named 3rd Defendant are not owners of The Kingston. The legal owner is Splendid Eminent Sdn Bhd. This fact was never disclosed. [45] It was also alleged that the deponent of the Plaintiff affidavit in support [in Enclosure 3] has no authority to affirm the affidavit for 1st Plaintiff in his capacity as Executive Deputy Chairman of the 1st Plaintiff. The deponent of the 1st Plaintiff's affidavit in support, Dato' Ramesh, had commenced an action against the 1 Plaintiff in Shah Alam High Court in Suit No. 22-382-2010 where he alleged that his contract of employment with the 1st Plaintiff had been prematurely terminated by the 1st Plaintiff on 16.3.2010. The 1st Plaintiff's affidavit in support was affirmed by Dato' Ramesh on 30.4.2010. Therefore, it is obvious that at the time he affirmed the affidavit he was not longer the Executive Deputy Chairman of the 1st Plaintiff. [46] For the above reasons, I order as follows: Enclosure 2 is dismissed with costs and damages to be assessed by registrar. Enclosure 7 and 10 allowed with costs and damages to be assessed by registrar and the ex parte injunction is set aside. Costs in all the applications to be paid forthwith after taxation.

Malayan Law Journal Reports/2010/Volume 6/MediaCorp News Pte Ltd & Ors v MediaBanc (Johor Bharu) Sdn Bhd & Ors - [2010] 6 MLJ 657 - 26 March 2010 83 pages [2010] 6 MLJ 657

MediaCorp News Pte Ltd & Ors v MediaBanc (Johor Bharu) Sdn Bhd & Ors
HIGH COURT (KUALA LUMPUR) NALLINI PATHMANATHAN J SUIT NO D5(D2)-22-763 OF 2007 26 March 2010 Copyright -- Existence of -- Broadcast of television and radio programmes -- Whether eligible for copyright protection under the Copyright Act 1987 -- Whether breach of provisions of the Communications and Multimedia Act 1998 vitiate copyright protection -- Whether copyright protection available for foreign broadcast -- Copyright Act 1987 ss 10, 42(1) & 59A -- Copyright (Application to Other Countries) Regulations 1990 Copyright -- Infringement -- Broadcast of television and radio programmes -- Copying, recording and reproduction of substantial part of broadcast -- Whether infringing plaintiffs' broadcast copyright and film copyright Copyright -- Infringement -- Defence of fair dealing -- Whether defence available -- Criteria to satisfy for invoking defence of fair dealing -- Whether material copied for non-profit purposes -- Copyright Act 1987 s 13 Copyright -- Ownership -- Ownership of copyright -- Broadcast of television and radio programmes --

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Whether ownership of copyright proven -- Whether true copies of works produced in court -- Whether producer author of broadcast -- Copyright Act 1987 s 42(1) Words and Phrases -- Meaning of 'author' -- Copyright Act 1987 The plaintiffs were broadcasting and media group of companies in Singapore. They delivered information and news to the public through television, radio, newspapers, magazines, movies and out-of-home media. The defendants were a group of companies incorporated in Malaysia providing integrated print/radio/television monitoring agency. The defendants selected television news programmes and commercials, radio news programmes and commercials, and newspaper and magazine advertising from which they collected, compiled, catalogued and archived data and information in a database. The defendants, from the compiled databank, for a fee, provided 6 MLJ 657 at 658 information to their clients who routinely required information and particulars of the media exposure they received or media exposure of other entities or persons. When providing this data to their clients, the defendants routinely supported and backed up the information and data provided with clips of news segments and commercials from their database. The provision of these clippings of news segments or commercials from the radio, television and other media which were produced, authored and delivered by the plaintiffs gave rise to the present dispute. The plaintiffs claimed that the defendants' continuous recording, compiling and archiving of their broadcasts and media programmes amounted to a breach of copyright. The defendants denied breach of copyright and maintained that even if the plaintiffs were able to establish a breach of copyright their relatively restricted use of such data as a monitoring agency amounted to 'fair use' falling within the purview of s 13 of the Copyright Act 1987 ('the Act'). The primary issues arising for consideration were as follows: (i) had the plaintiffs established ownership of copyright in the television and radio news programmes produced and broadcasted by them; (ii) had the defendants' infringed the plaintiffs' copyright in the said works; and (iii) was the defence of fair use/fair dealing available to the defendants. Notwithstanding that the plaintiffs sought protection for all television news programmes and radio programmes, for the purposes of the trial, they produced in evidence four full television news programmes of 30 minutes each, which were annexed to an affidavit in compliance with s 42 of the Act. The plaintiffs also produced through PW5, ie vide the trap purchases, infringing copies. The defendants contended that the plaintiffs had breached the Communications and Multimedia Act 1998 ('CMA') and therefore the subsistence of copyright was vitiated. Held, allowing the plaintiffs' application with costs: (1) The 'author' of a broadcast of the television news programmes would be the person or corporate entity transmitting the programme if he or it has responsibility for selecting the contents of those television news programmes, or anyone providing the programme who works together with the person transmitting it. Thus, the 'author' of a broadcast is the producer of the broadcast. The author of the television news programmes was therefore the producer of those news programmes. By virtue of establishing that the first plaintiff was the producer of the television news programmes and that it subsequently assigned all those rights to the fourth plaintiff, the plaintiffs had established authorship in the news programmes entitling the broadcasts of the television news programmes to be eligible for copyright protection under the Act (see paras 111 & 117). There were no true copies of the broadcast of the radio programmes or a reduction into fixed form of the sound recordings of such radio programmes. There was no object or copy which the court could refer 6 MLJ 657 at 659 to as the 'works' in respect of which broadcast and sound copyright protection was sought. In order to establish copyright in the radio programmes it was incumbent upon the plaintiffs to produce a true copy of, at least, some radio programmes, as they did for the television news programmes (see paras 127-128). The plaintiffs' broadcasts of their television news programmes fell within the purview of s 10

(2)

(3)

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(4) (5)

(6)

(7)

and were eligible for copyright protection under the Act. Being Singaporean, they were eligible for copyright protection by virtue of the reciprocity and conferment of protection provision in s 59A and reg 4(1)(a) and (b) of the Copyright (Application to Other Countries) Regulations 1990 (see paras 133 & 169). Even if there was a contravention of the CMA, the plaintiffs were entirely without mens rea in 'committing' any such illegality. The non-compliance with the provisions of the CMA did not deprive the plaintiffs of broadcast copyright protection (see para 184). Since the plaintiffs enjoyed broadcast copyright protection under the Act, the defendants are not at liberty to record, reproduce a substantial part of the broadcast either in its original form or in any way recognisably derived from the original, unless they had the express permission or a license from the plaintiffs. The defendants' acts of copying the news programmes in totality for the purposes of compiling, storing, editing and selling or reproducing segments for sale infringed the plaintiffs' broadcast copyright and their film copyright in the pre-recorded segments of those broadcasts (see paras 188 & 193). The matters to be considered in determining whether a use or dealing is 'fair dealing' within the Act includes the following factors: (i) the purpose of the dealing and whether it falls within the specified exceptions in s 13(2)(a); (ii) the nature of the work; (iii) whether it can be said that a substantial part of the work has been copied or utilised when compared with the original work; (iv) on an objective assessment what is the impression created by the reproduced/copied dealing; (v) the effect of such dealing upon the potential market for, or value of the work; and (vi) what is the motive of the party in its dealing with the work (see para 215, 215(a)-(f)). The motive of the defendants in recording continuously the broadcasts of the plaintiffs' television news programmes was to compile an archive of information so as to provide data and analysis to its clients for a fee. The defendants' operations as a media monitoring agency did not fall 6 MLJ 657 at 660 within the purview of the statutory exception. Neither did it fall within any of the other exceptions set out in s 13(2) of the Act (see paras 216(f) & 248).

Plaintif-plaintif adalah kumpulan syarikat penyiaran dan media di Singapura. Mereka menyampaikan maklumat dan berita kepada orang ramai melalui televisyen, radio, akhbar, majalah, wayang dan media di luar rumah. Defendan-defendan adalah kumpulan syarikat ditubuhkan di Malaysia yang menyediakan agensi pemonitoran penerbitan/radio/televisyen. Defendan-defendan memilih berita rancangan dan iklan televisyen, berita rancangan dan iklan radio, dan pengiklanan akhbar dan majalah yang telah dikumpul, disusun, dikatalogkan dan diarkibkan data dan maklumatnya dalam pangkalan data. Defendan-defendan, berdasarkan bank data yang dikumpul, untuk suatu bayaran, telah memberikan maklumat kepada pelanggan yang secara rutin memerlukan maklumat dan butir-butir pendedahan media yang diterima oleh mereka atau pendedahan media terhadap entiti atau orang lain. Semasa memberikan data ini kepada pelanggan mereka, defendan-defendan secara rutin telah disokong dan mendapat maklumat dan data sokongan yang telah diberikan dengan keratan segmen berita dan iklan daripada pangkalan data mereka. Peruntukan keratan segmen berita atau iklan daripada radio, televisyen dan media lain yang diterbitkan, dikarang dan dihantar oleh plaintif-plaintif telah menimbulkan pertikaian ini. Plaintif-plaintif mendakwa bahawa rakaman, pengumpulan dan pengarkiban berterusan defendan-defendan terhadap penyiaran dan rancangan media mereka membentuk pelanggaran hak cipta. Defendan-defendan menafikan pelanggaran hak cipta dan menegaskan bahawa meskipun plaintif-plaintif dapat membuktikan pelanggaran hak cipta penggunaan data mereka yang agak terbatas sebagai agensi pemonitoran membentuk 'penggunaan adil' yang terangkum dalam skop s 13 Akta Hak Cipta 1987 ('Akta tersebut'). Isu-isu utama yang timbul untuk dipertimbangkan adalah seperti berikut: (i) adakah plaintif-plaintif telah membuktikan hak milik terhadap hak cipta dalam rancangan berita televisyen dan radio yang diterbitkan dan disiarkan oleh mereka; (ii) adakah defendan-defendan telah melanggar hak cipta plaintif-plaintif dalam kerja-kerja tersebut; dan (iii) adakah terdapat pembelaan penggunaan adil/urusan adil bagi defendan-defendan. Walaupun plaintif-plaintif memohon perlindungan untuk semua rancangan berita televisyen dan rancangan radio, bagi tujuan perbicaraan, mereka telah mengemukakan keterangan empat rancangan penuh berita televisyen selama 30 minit setiap satu, yang telah dilampirkan kepada afidavit bagi mematuhi s 42 Akta tersebut. Plaintif-plaintif

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juga telah menerbitkan salinan yang melanggar hak cipta melalui PW5, iaitu melalui belian perangkap. Defendan-defendan menegaskan bahawa plaintif-plaintif telah melanggar 6 MLJ 657 at 661 Akta Komunikasi dan Multimedia 1998 ('AKM') dan oleh itu kewujudan hak cipta itu menjadi tidak sah. Diputuskan, membenarkan permohonan plaintif-plaintif dengan kos: (1) 'Pengarang' siaran rancangan berita televisyen merupakan individu atau entiti korporat yang menyiarkan rancangan itu jika dia atau ia mempunyai tanggungjawab untuk memilih kandungan rancangan berita televisyen tersebut, atau sesiapa yang menyediakan rancangan itu yang telah bekerjasama dengan individu yang menyiarkannya. Oleh itu, 'pengarang' suatu siaran merupakan penerbit siaran itu. Pengarang rancangan berita televisyen dengan itu adalah penerbit rancangan berita tersebut. Dengan membuktikan bahawa plaintif pertama adalah penerbit rancangan berita televisyen dan bahawa ia seterusnya menyerahkan semua hak-hak tersebut kepada plaintif keempat, plaintif-plaintif telah membuktikan pemunyaan rancangan berita yang mana memberi hak kepada siaran rancangan berita televisyen untuk layak mendapat perlindungan hak cipta di bawah Akta tersebut (lihat perenggan 111 & 117). Tiada salinan sebenar siaran rancangan radio atau rakaman bunyi yang telah dijadikan kepada bentuk tetap bagi rancangan radio tersebut. Tidak ada objek atau salinan yang boleh dirujuk oleh mahkamah sebagai 'kerja-kerja' berhubung perlindungan hak cipta siaran dan bunyi yang dipohon. Bagi tujuan membuktikan hak cipta dalam rancangan radio itu, adalah kewajipan plaintif-plaintif mengemukakan salinan sebenar, atau sekurang-kurangnya beberapa rancangan radio, sepertimana yang telah dilakukan oleh mereka untuk rancangan berita televisyen (lihat perenggan 127-128). Siaran rancangan berita televisyen plaintif-plaintif terangkum di bawah skop s 10 dan layak mendapat perlindungan hak cipta di bawah Akta tersebut. Sebagai seorang warganegara Singapura, mereka layak mendapat perlindungan hak cipta menurut peruntukan kesalingan dan kurniaan perlindungan dalam s 59A dan peraturan 4(1)(a) dan (b) Peraturan-Peraturan Hakcipta (Pemakaian Bagi Negara-Negara Lain) 1990 (lihat perenggan 133 & 169). Meskipun terdapat percanggahan kepada AKM, plaintif-plaintif secara keseluruhan tiada mens rea dalam 'melakukan' apa-apa kepenyalahan undang-undang. Ketidakpatuhan terhadap peruntukan-peruntukan AKM tidak menafikan plaintif-plaintif perlindungan hak cipta siaran (lihat perenggan 184). Oleh kerana plaintif-plaintif menikmati perlindungan hak cipta siaran di bawah Akta tersebut, defendan-defendan tidak bebas untuk merakam, menerbit semula sebahagian besar siaran tersebut sama ada 6 MLJ 657 at 662 dalam bentuk asal atau dalam apa-apa bentuk yang dikenali berasal daripada yang asli, kecuali jika mereka mendapat kebenaran nyata atau lesen daripada plaintif-plaintif. Tindakan defendan-defendan membuat salinan rancangan berita itu secara keseluruhan bagi tujuan mengumpul, menyimpan, menyunting dan menjual atau menerbitkan semula sebahagian daripada segmen itu untuk dijual telah melanggar hak cipta siaran plaintif-plaintif dan hak cipta perfileman mereka dalam segmen pra rakaman terhadap siaran tersebut (lihat perenggan 188 & 193). Perkara-perkara yang perlu dipertimbangkan adalah sama ada penggunaan atau urusan 'fair dealing' yang dinyatakan dalam Akta tersebut termasuklah faktor-faktor berikut: (i) bagi tujuan urusan dan sama ada ia terangkum di bawah pengecualian yang ditetapkan dalam s 13(2)(a); (ii) sifat kerja itu; (iii) sama ada ia boleh dikatakan bahawa sebahagian besar kerja itu telah disalin atau digunakan jika dibandingkan dengan kerja asal; (iv) berdasarkan penilaian objektif apakah tanggapan yang terbentuk dengan urusan penerbitan semula/penyalinan itu; (v) kesan urusan itu terhadap potensi pasaran untuk, atau nilai terhadap kerja itu; dan (vi) apakah motif pihak dalam urusannya dengan kerja itu (lihat perenggan 215, 215(a)-(f)). Motif defendan-defendan dalam merakamkan secara berterusan siaran rancangan berita televisyen plaintif-plaintif adalah untuk mengumpul arkib maklumat bagi tujuan memberi data dan analisis kepada pelanggannya untuk suatu bayaran. Operasi defendan-defendan sebagai

(2)

(3)

(4)

(5)

(6)

(7)

Page 17

agensi pemonitoran media tidak terangkum dalam skop pengecualian statutori. Ia juga tidak terangkum dalam mana-mana pengecualian lain yang ditetapkan di bawah s 13(2) Akta tersebut (lihat perenggan 216(f) & 248). Notes For cases on copyright generally, see 3(2) Mallal's Digest (4th Ed, 2010 Reissue) paras 5641-5750. For cases on defence of fair dealing, see 3(2) Mallal's Digest (4th Ed, 2010 Reissue) paras 5699-5700. For cases on infringement of copyright, see 3(2) Mallal's Digest (4th Ed, 2010 Reissue) paras 5687-5715. For cases on ownership generally, see 3(2) Mallal's Digest (4th Ed, 2010 Reissue) paras 5731-5732. Cases referred to Asia Television Ltd & Anor v Viwa Video Sdn Bhd & Connected Cases [1984] 2 MLJ 304, FC (folld) Aztech Systems Pte Ltd v Creative Technology Ltd [1996] 1 SLR 683, HC (refd) Beloff v Pressdram Ltd and another [1973] 1 All ER 241, Ch D (refd) 6 MLJ 657 at 663 CCH Canadian Ltd v Law Society of Upper Canada [2004] SCC 13, SC (refd) De Garis & Anor v Neville Jeffress Pidler Pty Ltd (1990) 95 ALR 625, FC (refd) Honda Giken Kogyo Kabushiki Kaisha v Allied Pacific Motor (M) Sdn Bhd & Anor [2005] 3 MLJ 30; [2005] 6 CLJ 174, HC (refd) Hubbard and another v Vosper and another [1972] 1 All ER 1023, CA (refd) Kelly v Arriba Soft Corporation 336 F 3d 811, CA (refd) Pacific and Southern Company Inc Wxia-Tv v Duncan Tv 744 F 2d 1490, CA (refd) Pro Sieben Media AG v Carlton Television Ltd [1998] FSR 43, CA (refd) Sayre v Moore (1785) 102 ER 139n (refd) Sillitoe v McGraw-Hill Book Company (UK) Ltd [1983] 9 FSR 545 (refd) Solid Gold Publishers Sdn Bhd v Chan Wee Ho & Ors [1998] 5 CLJ 735, HC (distd) Television New Zealand v Newsmonitor Services Ltd (1993) 27 IPR 441 (refd) Legislation referred to Communications and Multimedia Act 1998 Copyright Act [SG] s 35(2) Copyright Act 1985 [CAN] s 29 Copyright Act 1987 ss 2, 3, 7, 7(1), 10, 10(1), (2), 13, 13(2), 13(2)(a), (l), 26(1), (2)(b), 27(3), 42, 42(1)(a)(ii), 42(2), 59A, 59A(1)(d) 15, 15(1), (2), (3), 26, s 4, 4(3)

Page 18

Copyright (Application to Other Countries) Regulations 1990 Schedule 2 Copyright, Designs and Patents Act 1988 [UK] Films (Censorship) Act 1952

regs 2, 3(a),

4, 4(1)(a), (b), (e),

Malaysian Communications and Multimedia Commission Act 1998 Celine Chelladurai (Zaid Ibrahim & Co) for the plaintiffs. Benjamin J Thompson (Thompson & Associates) for the defendants. Nallini Pathmanathan J INTRODUCTION [1] The plaintiffs in this case comprise the leading broadcasting and media group of companies in Singapore. They are also established in Asia. Collectively they are known as the 'MediaCorp group' and collectively they produce and deliver information and news to the public through the medium of television, radio, newspapers, magazines, movies and out of home media. The defendants on the other hand collectively comprise a group of companies incorporated in Malaysia which provide an integrated print/radio/television monitoring agency to their diverse set of clients. Their operations span the major South East Asian nations. Essentially the group, known as the MediaBanc group, monitors and compiles selected television news 6 MLJ 657 at 664 programmes and commercials, radio news programmes and commercials, and newspaper and magazine advertising on a continuous basis. Such data and information is collected, compiled, catalogued and archived in a database. Clients of MediaBanc routinely require information and particulars of the exposure they have received in the media. Alternatively they have queries with regards to the media exposure of other entities or persons. MediaBanc, as a monitoring agency, is able from its compiled databank to meet its clientele's requests by providing, for a fee, such particulars, data and information requested for, provided they possess it. When providing this data to their clients MediaBanc routinely support and back up the information and data provided with clips of news segments and commercials from their database. It is this last feature, namely the provision of, inter alia, clippings of news segments or commercials from the radio, television and other media which were produced, authored and delivered by the MediaCorp group of companies that has given rise to the dispute before this court. The plaintiffs maintain that the defendants' continuous recording, compiling and archiving of their broadcasts and media programmes amounts to a breach of copyright, as the plaintiffs have accorded no licence nor consented to the defendants' use of such data and information broadcast and produced by them. The defendants however maintain that their compilation, categorisation and archiving of such broadcasts does not amount to a breach of copyright. They further maintain that even if the plaintiffs are able to establish a breach of copyright their relatively restricted use of such data as a monitoring agency amounts to 'fair use' falling within the purview of s 13 of the Copyright Act 1987. [2] It is to be noted at the outset that the plaintiffs are not pursuing their claims in infringement of trademark and passing off and therefore these causes of action are no longer relevant in the adjudication of the dispute. ISSUES [3] The primary issues that arise for consideration are as follows: (a) (b) (c) Have the plaintiffs established ownership of copyright in the television and radio news programmes produced and broadcast by them? Have the defendants infringed the plaintiffs' copyright in the works above, and if so which acts of the defendant constitute infringement? Is the defence of fair use/fair dealing available to the defendants?

Page 19

THE TRIAL [4] The trial of this matter took place over a period of four days. Eleven witnesses were called to testify, seven for the plaintiffs and four for the 6 MLJ 657 at 665 defendants. The plaintiffs' witnesses were: (a) (b) (c) (d) (e) (f) (g) Joanne Leow, PW1 ('PW1') a producer-presenter of news with the fourth plaintiff, MediaCorp Pte Ltd; Teo Chia Leen, PW2 ('PW2') an executive editor with the fourth plaintiff, MediaCorp Pte Ltd; Adelene Koh, PW3 ('PW3') a manager in programme sales and marketing with the fourth plaintiff, MediaCorp Pte Ltd; Yasmine Yahya, PW4 ('PW4') a business reporter with the fourth plaintiff, MediaCorp Pte Ltd; Nur Ezza Saad, PW5 ('PW4') an operations manager with a private investigator's firm, Radall Gateskill Risk Management; and Yong Chung Jin, PW6 (PW6') the assistant vice president for programme sales and marketing with the fourth plaintiff, MediaCorp Pte Ltd; and Benjamin Loh Tse Min, PW7 ('PW7') legal counsel for the MediaCorp group of companies.

[5] The defendants' witnesses were: (a) (b) (c) (d) Badri bin Mohamad Saaid, DW1 ('DW1') the marketing director of one Sportswork Group Sdn Bhd; Choy Su Ling, DW2 ('DW2') a public relations consultant; Lim Leong Wouh, DW3 ('DW3') the chief executive officer for the MediaBanc group of companies, who is also a director of the first, second, third, fourth and fifth defendants; and Ghazalie Saw bin Abdullah, DW4 ('DW4') a public relations consultant who runs his own public relations practice.

THE EVIDENCE [6] Three bundles of documents were produced in court. Most of the documents were in Part A or B. The placement of documents in Part A meant that the plaintiffs and the defendants were agreed on the issue of the authenticity of the documents as well as their contents. Documents placed in Part B meant that while the authenticity of the documents were not in issue, thereby precluding the need to call the maker of those documents, their contents remained in dispute. Given that the majority of the documents were in Part A or B, it was agreed by all parties that there was no necessity to mark 6 MLJ 657 at 666 each and every document adduced in court. The documents in Parts A and B would be referred to by the parties in accordance with the page number on which they appeared. [7] There were a few documents in Part C. In so far as these documents were concerned, where the very validity of the document was in issue, the maker had to be called or submissions made on the admissibility of the documents prior to their being admitted or marked in evidence. Accordingly only the documents in Part C and separately produced exhibits relating to the establishment of ownership of copyright under s 42 of the Copyright Act 1987 were marked individually as exhibits. From the totality of the evidence adduced through the 11 witnesses, the following facts could be gleaned. SALIENT FACTS The parties [8] The first plaintiff owns and operates in Singapore a free-to-air news channel known as Channel NewsAsia and is also the producer of all news bulletins broadcast on the plaintiffs' television channels such as 'Channel 5', 'Channel 8', 'Channel U', 'Suria' and 'Central' pursuant to respective commissioning agreements with the third plaintiff and MediaCorp TV12 Singapore Pte Ltd, all of which were produced in

Page 20

court. [9] The second plaintiff owns and operates in Singapore the following radio stations which broadcast in four different languages: (i) Gold 90.5FM; (ii) Class 95FM; (iii) 98.7FM; (iv) 93.8LIVE; (v) Symphony 92.4FM; (vi) Lush 99.5FM; (vii) Capital 95.8FM; (viii) Love 97.2FM; (ix) YES 93.3FM; (x) Warna 94.2FM; (xi) Ria 89.7FM; (xii) Oli 96.8FM; (xii) The International Channel; (xiii) Radio Singapore International; and (xiv) SmartRadio. [10] The third plaintiff is a terrestrial broadcaster and owns and manages 'Channel 5', 'Channel 8' and 'Channel U'. Many of these television and radio programmes may be viewed in Johore Bahru and selected parts of Malaysia. [11] The fourth plaintiff is the parent company of the first, second and third plaintiffs. As of 1 April 2008 the first and second plaintiffs assigned their entire ownership of copyright in their television news programmes and their radio programmes respectively to the fourth plaintiff (this has not however been pleaded in the statement of claim). [12] The defendants are a part of the MediaBanc group of companies as described above in the introduction, whose primary activity and operations centre around media monitoring. The defendants monitor print, radio and 6 MLJ 657 at 667 television content and provide media monitoring services to governmental and non-governmental organisations. The plaintiffs' complaint [13] Yong Chung Jin, PW6 ('PW6') who is the Assistant Vice President of Business Development of the fourth plaintiff was the main witness on behalf of the plaintiffs' group of companies. PW6 set out the chronology of events leading up to the dispute. [14] He testified that the entire dispute between the plaintiffs and the defendants arose in January 2006 when he received information from a client/customer on 12 January 2006 that a company known as 'MediaBanc Singapore' had approached this customer with the offer of providing footage and/or media clips that it, MediaBanc taped off-air from various television stations including Channel NewsAsia. [15] Upon receiving this information, PW6 visited MediaBanc Singapore's website and discovered that it was in actual fact the first defendant, MediaBanc (Johore Bharu) Sdn Bhd. On the same day, ie 12 January 2006, he wrote an email to the general email address of MediaBanc Singapore. In this email he sought to verify from the first defendant whether MediaBanc could provide footage or media clips which it had taped off-air from, inter alia, Channel NewsAsia and whether there was any form of licensing arrangement between MediaBanc and Channel NewsAsia. [16] He received a reply from 'MediaBanc Singapore' the following day, on 13 January 2006 when a Ms Kiang So Peng called. PW6 asked Ms Kiang whether the first defendant had obtained a licence or the consent of the first plaintiff to provide such footage and/or media clips. PW6 recorded and confirmed the contents of his conversation with Ms Kiang in an email dated 13 January 2006. In this email, PW6 states that Ms Kiang had mentioned that MediaBanc recorded news footage off Channel NewsAsia and Channel NewsAsia International, and then sold copies of the same to third parties. PW6 then advised that such recording, reproduction, sale or distribution of its programmes without the permission of the plaintiffs amounted to an infringement of the plaintiffs' copyright in such programmes. Notwithstanding this, the plaintiffs maintained that they were willing to meet with the defendants on a 'without prejudice' basis to resolve this issue. PW6 requested that the defendants cease any continued recording and sales of its media content pending the full resolution of the matter. A meeting was fixed for 18 January 2006 at the plaintiffs' offices. However this 'without prejudice' meeting was not successful and no resolution was reached. 6 MLJ 657 at 668 [17] While the plaintiffs were considering their next course of action, PW6 stated that he was sent an email dated 28 June 2006 by one Adelene Koh. This email contained in turn an email from an organisation known

Page 21

as TMC Education Corporation which forwarded an email from 'MediaBanc Singapore' or the first defendant offering TMC Education Corporation clippings of television broadcast coverage on the institution which had been aired on 26 June 2006 on both Channel NewsAsia and Channel U. These clippings were offered for sale by the first defendant to TMC Education Corporation. [18] On or about 4 July 2006 an employee of the first plaintiff forwarded an email she had received to PW6. This email was from the Victoria School which had in turn also been approached by 'MediaBanc Singapore' to offer for sale clips of the television broadcast coverage on Victoria School entitled '300 Schools to Take Part in Festival Offering Talks for Parents' which aired on one of the plaintiffs' television channels, Channel 8 on 28 June 2006. [19] Upon receipt of this information the plaintiffs sought legal advice. They also instructed their solicitors to retain the services of a private investigator to obtain further information pertaining to the MediaBanc group and to conduct trap purchases. The private investigator who conducted these trap purchases, Nur Ezza Saad, PW5 ('PW5') testified in court. She stated that the first plaintiff instructed her employer, Randall Gateskill Risk Management to conduct a series of trap purchases with respect to various news programmes relating to Channel NewsAsia, Channel 8, Channel 5, Channel U, Suria and others on 8 August 2006. The plaintiffs wanted to procure a copy of the video clips or other recordings made by MediaBanc, as well as any other advertising or marketing material issued by MediaBanc. The purpose was to ascertain the scope of MediaBanc's activities, particularly in relation to the recording and sale of the plaintiffs' media content. [20] The first trap purchase was conducted on 11 September 2006. The second defendant, MediaBanc (Malaysia) Sdn Bhd was approached by PW5 and requested to provide random clips of television news broadcasts aired in respect of: (a) (b) (c) the Singapore's integrated casino resort; the Singapore-KL air route; and the luxury terminal in Changi airport,

from any channel. MediaBanc (Malaysia) Sdn Bhd referred the matter to MediaBanc (Johor Bharu) Sdn Bhd, the first defendant. One week later, on 18 September 2006, the first defendant reverted to the second defendant with news clips from both television and radio sources which included Channel 8, 6 MLJ 657 at 669 Channel U, Channel 5, Suria, Channel NewsAsia, Central and 93.8FM. The clips offered for sale by the defendants had been copied directly at the various times of broadcast on various dates from the plaintiffs' channels. The sale price for these clips was RM120 per clip. PW5 agreed to purchase all the clips whereupon 17 such clips were purchased from the second defendant. The clips were collected on 25 September 2006 in a compact disc format. A purchase order, invoice and original receipt were given to PW5. [21] When these news clips were played it was evident that the devices and trademarks of each television channel could clearly be seen on the screen. No attempt was made to delete, fade-out or mark-out the plaintiffs' names. When providing the news clippings sought by the plaintiffs in the first trap purchase, the second defendant of its own initiative advised PW5 that in the event they required more news clips from early 2005, the second defendant was able to provide the same. Accordingly the plaintiffs decided to accept the second defendant's invitation and conduct a second trap purchase. Therefore on 11 October 2006 the second defendant was again approached by PW5 with a request for television news broadcasts aired in respect of the Singapore Government's announcements on the integrated resort of Sentosa in April or May 2005. The second defendant again referred the matter to the first defendant. In this instance the first defendant was unable to provide clips copied prior to June 2005. The first defendant did however have in its records up to 54 clips in respect of the relevant topic required between June 2005 and July 2006. These clips were again from the plaintiffs' various television channels and had been copied at the various dates and times of broadcast from various channels. [22] For the service of tracking and compiling these clips within the specified period, the second defendant charged a service fee of Singapore dollars $2,400 and offered to sell each clip for RM66. There was an offer of a 50% discount on the fees for the tracking service if more than ten clips were purchased. PW5 purchased

Page 22

ten clips which were collected from the second defendant on 21 November 2006 in the form of a compact disc again, together with the requisite purchase order, invoice and receipt. [23] A playing of this last compact disc also disclosed clippings of news segments from many of the plaintiffs' television channels, including Channel NewsAsia, Channel 5, Channel 8, Channel U, Suria and Central. Their devices or trademarks showed up clearly in these clippings and no attempt had been made to delete these marks. The compact discs and documents procured during the course of the two trap purchases were duly produced in court and marked. 6 MLJ 657 at 670 [24] The plaintiffs then chose to play for the court four selected video clips: (a) A clip on Channel NewsAsia comprising a segment within the 'Singapore Tonight' news which airs daily at 10pm. This particular clipping ('track No 4') was dated 23 August 2006, aired at 10.13pm and related to the construction of Marina Bay. The presenter was Cheryl Fox, the reporter Wong Siew Ying and the producer cum editor of the news was Bhagman Singh. This clipping, more particularly track No 4 was marked as exh P2A. The second clip was from Channel 5 which carried a news programme entitled 'News 5'. It was aired on 4 September 2006 at 9.33pm and related to the Singapore-KL Air route that was to be opened up. The newsreader, reporter and editor cum producer are all employees of the first plaintiff. This clip ran for two minutes and 27 seconds and was marked as exh P2B. The third clip was also from Channel NewsAsia on the 'Singapore Tonight' news. It aired at 10.11pm on 4 September 2006. The newsreader, reporter and editor/producer are all employees of the first plaintiff. This clip ('track No 3') ran for three minutes and is comprised in exh P2C; The fourth clip was from Channel 5 and aired during the 'News 5' programme on 13 September 2006 at 9.45pm. The topic featured was Changi airport's facelift of Terminal 2. Again the newsreader, reporter and editor/producer are all employees of the first plaintiff. This clip ('track No 2') ran for two minutes 58 seconds and is a part of exh P2D.

(b)

(c)

(d)

[25] From these clips shown to the court, the plaintiffs established that segments from their television news programmes had been monitored, copied, edited (in terms of clippings) and recorded into different media, ie compact disc form for sale to third parties for a fee. [26] Apart from the foregoing, the plaintiffs discovered, as a result of the trap purchase investigations, considerable information about the operations and workings of the defendants. The private investigator discovered that 'MediaBanc Singapore' was based in Johore Bharu, that it was in reality the first defendant that conducted monitoring operations for the Singapore market. The second and third defendants, ie MediaBanc (Malaysia) Sdn Bhd and MediaBanc Group Sdn Bhd in turn, monitor the Malaysian media as well as the Asian market. The second defendant manages the centralised billing system for the group while the third defendant is an investment holding company and provides management services. The third defendant is a shareholder of the first, second and fourth defendants while the first and second defendants are shareholders of the fifth defendant. The fourth defendant provides analysis 6 MLJ 657 at 671 services for the group while the fifth defendant is responsible for research and as an international marketing arm. Their clients ranged from governmental to non-governmental organisations and corporations such as Far East Organisation, Esplanade, IBM Media Development Authority, Daimler Chrysler and a host of other entities. This evidence given by PW6 was not denied by the defendants, nor was he cross-examined on the same, leading to the conclusion that it is true. [27] Having secured information and data vide the trap purchases the plaintiffs on 22 January 2007 instructed its solicitors to first issue cease and desist letters requesting that the defendants cease infringing the plaintiffs' copyright in the news programmes it broadcast, immediately. Notwithstanding the issuance of such letters, the plaintiffs discovered at around the same time that another entity was approached by the first defendant or 'MediaBanc Singapore' offering for sale radio broadcast coverage on that entity which had been aired live on 17 December 2006 on the subject of school holidays. The offer was made by the first defendant

Page 23

at a discounted rate. Once again the plaintiffs' solicitors issued cease and desist letters to each of the defendants requesting that they cease all acts of infringement of the plaintiffs' news programmes. [28] The first defendant on behalf of all the defendants responded by initiating negotiations with the plaintiffs with a view to achieving an amicable settlement of the matter. However once again a resolution was not reached. The plaintiffs were unwilling to continue negotiations as the defendants were not prepared to stop their operations relating to the recording, distributing, copying and selling of content recorded from the plaintiffs' news and radio programmes. As late as 13 April 2007 the plaintiffs learnt through an employee of the fourth plaintiff that the Ministry of National Development of Singapore ('MNDS') were approached by the MediaBanc group and offered for sale television broadcast news coverage which had been aired on Channel NewsAsia, Channel 8, Channel U and Channel 5 on 9 April 2007 relating to the reopening of a granite quarry. [29] PW6 testified that as a consequence of the defendants' activities, which he maintained amounted to an infringement of the plaintiffs' copyright in the news programmes and radio programmes, the plaintiffs suffered loss and damage because the plaintiffs have a similar business. They too sell video clips and sound clips and generate income thereby. Accordingly PW6 maintained that they had lost the opportunity to earn income thereby as the defendants had sold infringing copies of their news clips from television and radio to third parties. Moreover, the plaintiffs were also concerned from the nature of the queries posed in the various emails referred to above, that the general public was misled into thinking or assuming that the plaintiffs and the defendants 6 MLJ 657 at 672 were in some way associated. In short PW6 maintained that confusion had been established vis-a-vis, the general public, resulting in their being deceived into placing orders for video clips with the defendants rather than the plaintiffs, the owners of copyright in the television and news programmes in issue. [30] PW6 also pointed out that as the defendants were monitoring, recording, copying, compiling and then selling these products without licence or authority from the plaintiffs, the defendants were able to price the sale of such clippings at a much lower rate than the plaintiffs. The plaintiffs had to factor into their price for such clips, the production costs they had borne, while the defendants had no such costs. The plaintiffs' grievance was that their reputation and good will would be irreparably injured if the defendants were allowed to proceed with their activities unchecked. [31] PW6 went on to explain that the plaintiffs had obtained an interim injunction to restrain the defendants from carrying on with their operations in relation only to the monitoring, copying, recording and selling of clips taken from the plaintiffs' broadcasts on 27 November 2007 which remains in place pending the adjudication and determination of the parties' rights at trial. However PW6 maintained that the defendants continued to breach the injunction and set out instances when he believed such was the case. Accordingly committal proceedings had been commenced against the directors and country manager of the first defendant. [32] In cross-examination, it was put to PW6 that the defendants had in fact referred clients to the plaintiffs to procure footage and clips. Learned counsel for the defendants, Mr Thompson, made reference to p 640 of the bundle B, an email from the defendants' employee to a client, advising them to contact the plaintiffs directly for footage. This email was dated 25 March 2009. PW6 however denied that this amounted to a referral from the defendants. He referred to an earlier email from the same client (at p 638 of the bundle B) where the client had written to PW6 directly and advised that she had procured the footage from MediaBanc. However PW6 did agree that if there had been any communication between the client and the defendants prior to 24 March 2009 that would have constituted a referral. [33] PW6 was asked whether he could produce any independent evidence to support his claim that the plaintiffs are the leading media and broadcasting group in Asia. He conceded that there was no research or ranking that placed the group at number one but that this was essentially self ranking. He was also asked about the plaintiffs' reputation in Malaysia. He answered that he did not know but maintained that the channel was viewed in the southern part of Malaysia. Additionally the plaintiffs also have a few programmes that are broadcast by local Malaysian stations. He conceded that the plaintiffs had 6 MLJ 657 at 673

Page 24

neither commissioned nor subscribed to any surveys on their market share of viewership or listeners to the plaintiffs' television and radio broadcasts in Malaysia. He was also unable to estimate the number of customers or viewers the plaintiffs had in Malaysia. [34] PW6 was next cross-examined on his contention that the plaintiffs own the copyright in the television programmes it produces. He was asked whether the plaintiffs had registered their copyright anywhere in the world, to which he responded that they had but he was not entirely sure where. However he was able to name Hong Kong and India as examples. [35] He was then queried on the plaintiffs' reporters and whether they were all full time employees of the plaintiffs. PW6 replied that as far as he was aware, the reporters were full time employees of the plaintiff. He conceded that it was possible that some reporters were not full time employees. He claimed to be unaware that the plaintiffs obtained reports from freelancers. He was then queried specifically on the video clips in exhs P2B and P2C. Reference was made to the segment where a reporter by the name of Melissa Goh was reporting from Kuala Lumpur. The question was whether she was reporting through a live feed or whether it was pre-recorded. PW6 stated that it 'should be' pre-recorded. It was put to him that in some situations the plaintiffs had to rely on live feed and the reporter would be outside their studios and the news live. PW6 agreed. [36] PW6 was asked about the supply of third party news footage from for example Reuters. He explained that the plaintiffs could use such footage as they had a licence to do so in accordance with the terms and conditions of such licence. He was asked whether such licence allowed him to transmit the clip outside of Singapore and he answered that the plaintiffs were not allowed to do so for all channels. [37] PW6 was then queried as to live presentations from the studio. He conceded that in the case of live feeds, there would be a lapse of a few seconds between the person speaking in the studio and the exact time when it could be viewed by the public in their homes. He estimated such a time lapse to amount to between 0.1 seconds and 2-3 seconds depending on the types of transmission. [38] PW6 also confirmed that his answers in relation to television programs were equally applicable to radio programmes. [39] As for the format of the recording done by the plaintiffs, PW6 explained that a few formats were adopted, DVD, low resolution format and beta tapes. He was then queried on the pricing for these various formats. He explained that 6 MLJ 657 at 674 the DVD format cost Singapore dollars $400 per clipping. This was recorded live and such a copy would take seven working days to be delivered. However a lower resolution copy would take less time. [40] It was put to PW6 that while clients of the defendant required media monitoring services from the defendants, they still sought clips directly from the plaintiffs. PW6 essentially agreed. [41] Next learned counsel referred to PW6's earlier statement that in the news programmes produced as evidence in court there were segments where the copyright belonged to the plaintiff, segments from Reuters and segments which are paid advertisements during the news bulletin. He asked PW6 whether it was wrong for someone to record the segment licensed to the plaintiffs by Reuters. PW6 responded by stating that it could be recorded for their own viewing. He also conceded that he could not take action against someone who recorded the segment from a third party such as Reuters, or the commercial breaks. PW6 maintained that the news clippings belonging to the plaintiffs could be recorded for private viewing. [42] Next focus was placed on the trap purchases. PW6 conceded that his evidence relating to the same was premised on what he had learnt from PW5. He also agreed that in the investigation it was PW5 who approached the defendants and sought specific services. The contention put to PW6 was therefore that the services offered in the trap purchase were not the same services they were providing to other clients. PW6 disagreed. [43] PW6 was then questioned about the trademarks and devices apparent on viewing the news clips. He

Page 25

maintained that even if the devices or trademarks were deleted or faded out, the viewer would know which station broadcast that clip. [44] Questioning then ensued on the issue of 'confusion' between the plaintiffs and the defendants. It was suggested that such confusion was caused by the branding strategy adopted by the plaintiffs which PW6 denied. He went on to explain that some customers thought that MediaBanc had been licensed or appointed by the plaintiffs. It was suggested that this was an isolated as opposed to a general viewpoint but PW6 disagreed, citing other instances when various Ministries had asked if the defendants and the plaintiffs were related. [45] PW6 was asked whether it could be discerned from footage obtained from the plaintiffs or any other party, where such footage was from or where it was sourced. PW6 maintained that it was not discernible from the footage as to where it was sourced. He agreed that none of the plaintiffs' trademarks or 6 MLJ 657 at 675 devices were on the cover of the compact disc. He further agreed that anyone receiving a report on the compact disc produced in court would not be deceived as to the source of the content on it, and that the quality of the recording on the compact disc was not of a high quality. PW6 also agreed that the plaintiffs did not provide media monitoring services but a library and retrieval service. [46] PW6 was also questioned on whether the plaintiffs were registered under the Communications and Multimedia Act 1998 and conceded that they are not. He could not tell whether the plaintiffs ensured that their content complied with the Malaysian Communications and Multimedia Content Code or the advertising code. It was put to him that the plaintiffs were unlicensed to operate or broadcast in Malaysia. [47] Essentially in cross-examination PW6 was challenged on the issue of their entitlement to establish or enforce copyright when they were not registered licencees under the Malaysian Communications and Multimedia Commission Act. The bulk of PW6's recital of the chronology of events leading up to this dispute is not in issue. The evidence of PW5, the private investigator [48] One of the other witnesses for the plaintiffs included the private investigator, PW5 who gave detailed evidence relating to the trap purchases conducted. The salient particulars relating to the trap purchase have been outlined above and I do not propose to repeat PW5's evidence into here. She did however particularise in greater detail the evidence given by PW6. PW6 essentially relied on her report to explain their response to the defendants' activities. [49] PW5 produced the relevant emails evidencing the procuring of recorded and archived clippings of television news programmes which had been monitored and recorded free from the air by the defendants before being categorised and archived. She also gave evidence that she went to the business premises of the second defendant to collect the video clips. In the course of her meetings with the defendants' employees she found out that all Singapore television and radio channels were monitored by MediaBanc's Johore Bharu branch while Malaysia's television and radio channels were monitored by MediaBanc (Malaysia) Sdn Bhd, the second defendant. PW5 also managed to procure a company profile, a list of media sources monitored by MediaBanc and its account number. The list of media sources monitored, recorded, copied and compiled for the country Singapore lists (at p 484 of the bundle B) for television Central, Channel 5, Channel 8, Channel U and Suria. As for radio 6 MLJ 657 at 676 stations there is a long list of stations monitored including, inter alia, Radio 93.8FM, Radio 94.2FM, Radio 95.8FM, Gold, Love, Yes and Ria. [50] In cross-examination PW5 confirmed that her scope of work was to obtain a copy of a video tape or such other record from MediaBanc. She further confirmed that her sole contact with the defendants was through Nur Elida Amin or 'Ally' with whom both the transactions had been conducted. She was unable to state whether the services she required of MediaBanc were the usual services provided by the defendants. In essence, PW5's evidence was not challenged substantively during the course of cross-examination

Page 26

thereby corroborating the veracity of the two trap purchases. The other witnesses for the plaintiffs were Joanne Leow Chuang Ching, PW1 ('PW1') a news presenter with the fourth plaintiff, who in 2006 was a reporter with the first plaintiff. Her evidence centered on the production of the email dated 4 July 2006 from the Victoria School, referred to earlier, where the school advised that they had been approached by MediaBanc with an offer of the sale of clips of television broadcast coverage on the school. She explained that she had received the email from the vice principal of the school asking her to take note of the offer from MediaBanc. The email was duly produced. There was no dispute as to the receipt of this mail by the plaintiffs. [51] The plaintiffs second witness was Teo Chia Leen, PW2 ('PW2') who was in 2006 one of the assignments editors of Channel NewsAsia. Her job scope then was to look through the news releases that came through email and faxes and to decide on the news coverage for the day. Her evidence centered on the receipt of an email from the Ministry of National Development of Singapore dated 13 April 2007 where an employee there had written advising that they were offered for sale television broadcast news coverage which had been aired on the plaintiffs' television channels. PW2 testified that it appeared to her that MNDS was unsure whether Mediabanc was affiliated to the plaintiffs. Again her evidence on this point was not challenged in the course of cross-examination. It follows that the defendants do not dispute that these offers of sale of news clippings were made by the defendants to MNDS and the Victoria School. [52] The third witness for the plaintiff was one Adelene Koh, PW3 ('PW3') who in 2006 was involved with the distribution of news content, programme content and footage within Singapore and international markets. The type of content that she was distributing then included news programmes, current affairs and documentaries belonging to the first plaintiff. She too produced an email dated June 2006 whereby the TMC Educational Group Pte Ltd was approached vide one Jeremiah Koo by MediaBanc. They offered the company clips of television broadcast coverage on the group which had been aired on Channel NewsAsia and Channel U on 26 June 2006. In cross-examination, 6 MLJ 657 at 677 PW3 confirmed that her testimony as to the receipt of the email was based on her memory. She stated that she could recall it because it was not a common email that was received daily. It was put to her that the email tendered in court contained no communication from the said Jeremiah Koo. PW3 disagreed maintaining that she did indeed receive such an email. She was then referred to an email exchange between an employee of MediaBanc and Jeremiah Koo and asked if she meant that email. When asked why her name did not appear, she explained that the email had been received in 2006 and that her email records had been lost as of October 2008. Hence her name was not there. PW3 then went on to state that while she could not remember precisely what emails she received over that period, she could recall Jeremiah Koo's email because it was an uncommon one that she did not normally receive in the course of her work. In essence the truth of her statement as to whether or not she received such an email was challenged. While there is no email to corroborate her version of events, it cannot be doubt from the email records before the court that an offer for the sale of news clippings was indeed made to the TMC Educational Group Pte Ltd. That fact is not in doubt and is the main fact of relevance to the dispute here. Whether or not PW3 received the email from Jeremiah Koo is of no real relevance. [53] The plaintiffs' fourth witness was Yasmine bt Yahya, PW4 ('PW4') who in 2006 was a news journalist with 93.8LIVE radio station of the fourth plaintiff. She gave evidence that she was the recipient of an email from one Adam Khoo Learning Technologies. The organisation had copied an email to her on 5 January 2007 which was addressed to an employee of MediaBanc. In the email Adam Khoo Learning asked MediaBanc's employee whether she was associated with 93.8LIVE radio station. PW4 testified that from the history of that email it appeared that the employee had offered Adam Khoo the sound clip of a news story which PW4 had conducted with the organisation. The offer to sell that sound clip was for the price of Singapore dollar $65. PW4 was not able to produce her response to this email as she had deleted the same but she explained that there was no nexus between MediaBanc and the plaintiffs. [54] In cross-examination, learned counsel for the defendants sought to take objection to the email, not having done so earlier. The essence of his objection was that the email was incomplete. However there was no dispute about the offer for sale by MediaBanc employee to Adam Khoo Learning Technologies. This is the relevant document for the purposes of this case, not the email to PW4 forwarding this email. In these

Page 27

circumstances the objection did not go to the root of the issue relating to whether or not an offer for the sale of the sound clip had been made. As such the plaintiffs successfully established that MediaBanc had been making offers of sale of radio clips produced by the plaintiffs to a third party. In view of the absence of the email to PW4 however, 6 MLJ 657 at 678 it was not possible to conclude with certainty that confusion had been created in relation to the identity or a possible affiliation between the plaintiffs and the defendants. [55] Apart from these witnesses, the plaintiff also sought to reopen its case after submissions had commenced at the close of trial. While the defendants were submitting on the issue of copyright ownership and entitlement, the submission was made that the plaintiffs had failed to establish copyright in the news segments produced, inter alia, because they had failed to produce in court some sample of the original works in respect of which it was maintained that copyright had been infringed. In other words, the defendants maintained that it was incumbent upon the plaintiffs to put forward a sample original sound recording or visual recording which they claimed had been infringed. [56] It then became apparent that there was a lack of agreement between the parties on this issue. Learned counsel for the plaintiffs, Ms Celine Chelladurai submitted that it was an agreed fact between the parties that ownership of copyright vested in the plaintiffs. Mr Thompson for the defendants had however commenced his submissions by attacking this issue. He maintained that it had never been an agreed fact that copyright subsisted in the plaintiffs. A perusal of the statement of agreed facts filed discloses that the parties agreed, inter alia, that: (a) (b) (c) (d) the first plaintiff owns and manages Channel NewsAsia and Channel NewsAsia International and is a producer of news and current affairs programmes in the South East Asia region; the second plaintiff is a radio broadcasting corporation in Singapore, operating Singapore's largest radio network with 13 radio stations; the third plaintiff is a terrestrial broadcaster which owns and manages Channel 5, Channel 8 and Channel U; and the fourth plaintiff is the holding company for the first, second and third plaintiffs.

[57] On the basis of these agreed facts it was the plaintiffs' contention that the subsistence of copyright in the plaintiffs was not in issue. Mr Thompson for the defendants contended otherwise. He maintained that agreeing to the foregoing did not amount to agreeing or admitting that copyright in media content subsisted in and was owned by the plaintiffs. In these circumstances Ms Chelladurai for the plaintiffs made an application to reopen the plaintiffs' case. She submitted that the plaintiffs had crafted its entire case based on the agreed facts and agreed main issues. On that premise the plaintiffs claimed to have understood that the establishment of copyright was not in issue. 6 MLJ 657 at 679 [58] A perusal of the defence discloses that at paras 6 and 7 the defendants put the plaintiffs to strict proof in respect of their claims that they are the producers and broadcasters of the television programmes. More importantly they deny that the first plaintiff is the owner of copyright in the news programmes referred to in the statement of claim as alleged and put the plaintiffs to proof. In para 8 the defendants elaborate further on why the plaintiffs 'cannot possibly own' copyright in and to all sale, distribution, telecase, exhibition and production rights in Malaysia. Similar averments have been pleaded vis-a-vis ownership in copyright in radio programmes thereby denying that the second plaintiff is indeed the owner of copyright in the radio programmes. [59] The court considered the request put forward by the plaintiffs with some caution. It did not appear to this court to follow from the statement of agreed facts that the defendants had conceded or admitted that copyright in the television and radio programmes which the plaintiffs claimed to have produced, vested in the plaintiffs. The defendants appear to have required the plaintiffs to prove such copyright. The plaintiffs therefore sought to reopen the case so as to introduce an affidavit to meet s 42 of the Copyright Act which allows for the establishment of prima facie ownership of copyright thus. The court finally allowed the plaintiffs' application in the interests of justice, so as to avoid a situation whereby the claim would be adjudicated

Page 28

without a full consideration of the issues raised in the course of the suit. [60] As the application was allowed, the plaintiffs introduced an affidavit under s 42 of the Copyright Act vide one Benjamin Loh Tse Min, legal counsel for the plaintiffs. The said witness, PW7, produced the affidavit affirmed by PW6 pursuant to s 42 of the Copyright Act 1987. The affidavit is dated 27 August 2009 and states, inter alia, as follows: (a) (b) (c) (d) (e) that PW6 is the assistant vice president of the fourth plaintiff and has been authorised by it to make the statutory declaration on their behalf; the fourth plaintiff is involved in the business of broadcasting television programmes and related services in Singapore; the first plaintiff (which is related to the fourth plaintiff) produced through its employees the news segments from which the news clippings produced in court as exhs P2C and P2B were taken. true copies of the news programmes which were aired on the respective dates at various times on the two television channels were produced in the form of digital video discs ('the works'). PW6 further affirmed that the editors and producers of the news in the said works were as he had testified earlier, Bhagman Singh, Cheryl 6 MLJ 657 at 680 Lim, and Hwee Goh who are all employees of the first plaintiff. In essence they were therefore the authors. PW6 affirmed that the first plaintiff had assigned all its rights and interests in the works had been assigned to the fourth plaintiff on 1 April 2008. He further stated that in keeping with the provisions of the Singapore Copyright Act (Cap 63), the copyright in the said works was deemed to be transferred to the first plaintiff, as the authors were all employees of the first plaintiff with effect from the respective dates of their creation until 1 April 2008 when the copyright vested in turn with the fourth plaintiff by reason of the assignment as explained earlier. PW6 concluded by averring that the works were eligible for copyright under the Copyright Act 1987 and that accordingly copyright subsists in Malaysia in the said works, which he asserted.

(f)

(g)

[61] Thus the plaintiff finally closed its case. The defence case [62] The defendants called several witnesses in support of its case. The primary witness was Lim Leong Wouh, DW3 ('DW3'), a director of the first, second third, fourth and fifth defendants. DW3 explained that he has been with the MediaBanc group since July 1997 when he established MediaBanc (Malaysia) Sdn Bhd, the second defendant together with two other partners. He was the general manager of the first and second defendants up to 2001. Since 2001 he has assumed the position of chief executive officer for the MediaBanc group. Daily operations of the various entities in the group are managed by country managers and a regional country manager. [63] DW3 then went on to describe the operations of the group. Essentially the MediaBanc group of companies are media monitors. They have more than 250 employees in Malaysia, Singapore, Indonesia, Philippines, Thailand and Vietnam. In each of those countries the MediaBanc group of companies monitor print media, television, radio and online media on behalf of its clients. MediaBanc consider themselves pioneers in this business in Malaysia and Singapore and according to DW3 are striving to develop the market in this field. [64] DW3 then went on to explain why its clients required their services, essentially for corporations or persons to ascertain information on what is said about them or their industry, their competitors or their products in the mass media. Their clients include political parties, government agencies, educational institutions, banking institutions, healthcare institutions and public relations 6 MLJ 657 at 681 firms. He summarised the function of a media monitoring entity as one that performed a guarding and

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analysing function or a monitoring and analysing function vis-a-vis the media for its clients, thereby allowing them to gauge public feedback and take measures to address such feedback or assist in the measuring of the performance of the entity. In view of the extensive media coverage in several forms that is current today, many organisations are unable to cope with the task of guarding and measuring information. [65] DW3 maintained that media monitoring is a complementary business not a competitive business to that of media owners. When asked why he had not offered to pay the media owners a licence fee and arrive at a commercially viable arrangement, he explained that the defendants had attempted to do that from the onset, even prior to the commencement of this suit or the injunction. However the area of dispute between the plaintiffs and the defendants was the rates insisted on by the plaintiffs. The rates demanded, according to the defendants were far in excess of what they could afford. Additionally the parties could not agree on another area. The plaintiffs wanted the defendants to stop recording and instead obtain segments of the news from them which would take up to seven working days. This time lag was too long for the defendants who needed to analyse, catalogue and archive the information far more quickly. As such all attempts to resolve the matter failed. [66] DW3 then explained how the media monitoring process was conducted. The 'heart' of the media monitoring system, he explained, is the software engine into which the defendants feed information and data acquired through their review and research of all forms of media. This software engine, developed by the defendants since 1997, is called the MediaBanc Information System ('MIS'). The copyright in the software and underlying database is owned by the third defendant. The MIS has two interfaces, the client interface and the operator interface. The process of media monitoring, DW3 explained, occurs as follows: (a) Trained operators of the first defendant review various sources of current news media and identify instances of the mention of company names, brand names and other phrases of current interest. This can be a complex process as it is necessary to identify and recognise all instances of mention at the time of the media broadcast, notwithstanding that there are several voices speaking at the same time, at different speeds and in foreign accents. To overcome this problem and to ensure an accurate review the first defendant records the transmission of the news broadcast onto video or audio tapes, to enable the operators to rewind the tapes and relisten or review the difficult portions of the broadcast or to seek assistance on the same. 6 MLJ 657 at 682 The used tapes are then reused for recording ie overwritten with other content according to a tape rotation schedule. The operators then use the operator interface of the MIS to enter information into the database, citing for example the name or phrase in question, the news programme on which it was mentioned, the date and time of the news programme, the channel on which it was aired, a short headline as to the context of the mention and the category of news and industry into which the mention falls. Analysts employed by the first defendant then use the MIS to statistically review the instances of mention. The fourth defendant uses the MIS and underlying database to perform advanced research for its clients -- for example both qualitative and quantitative measurements for its clients' management purposes.

(b)

(c) (d)

(e)

[67] DW3 explained that clients who retained the defendants or subscribed to their outsourcing services were advised on a daily basis of the instances in which their name, their competitior's names, their industry or other pre-determined subjects of interest were mentioned over the television and radio media during the previous day and that very morning in the newspapers. The format of the report list provided enables the client to study, review, sort, evaluate and analyse the information according to their specific needs. As a consequence of the interim injunction procured by the plaintiffs, DW3 maintained that the defendants have suffered grave damage vis-a-vis the database and consequently the accuracy and comprehensiveness of their statistics and analysis as they have been prevented from making recordings even for their own research and analysis and for compilation of information. [68] DW3 explained that to address these weaknesses the defendants sought legal advice on the 'fair use'

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provisions under copyright law that in the public interest allows for copying or reproduction under certain circumstances. Accordingly to meet the category of 'fair use' DW3 stated that the defendants' media monitoring services were provided in the following manner: (a) At their request, the defendants' clients are provided with excerpts from the audio or video recordings so as to convey only the information as to the context in which their company or brand name was mentioned. For example they might get a two minutes excerpt from a 30 minutes news programme. The defendants ensure that they acknowledge the source of the excerpts as required under copyright law to qualify for fair use. The defendants add to the excerpt an extract from the very beginning of the programme and another extract from the end of the programme, so as to show the presenter and rolling credits. 6 MLJ 657 at 683 The watermark or other identifier of the TV station broadcasting the programme is in no way obliterated or otherwise distorted. The excerpt is digitally compressed before being made available to the clients to ensure that the quality of the excerpt is reduced and rendered unsuitable for rebroadcasting, re-recording or any other purpose. According to DW3 the clients are consistently notified that they are not to place the excerpts on their corporate websites or for it to be used in corporate videos. The charges are only in respect of compilation, editing and delivery. There is no charge for the excerpt. The defendants also do not offer for sale copies of whole news segments, nor rebroadcast the plaintiffs' programmes. They only review and analyse the programme for information which could impact their clients.

(b)

(c)

(d)

[69] DW3 was then asked to explain the actions of MediaBanc's ex-employee, one Kamaljeet Kaur who had sent emails to various organisations offering for sale copies of recordings made from programmes produced by the plaintiffs. DW3 stated in response that the defendants had to actively market their services in the market as the concept of media monitoring is still new to the public. In an effort to improve marketing and customer sales, it offered its employees remuneration based on the achievement of monthly targets and sales commissions. Kamaljeet, DW3 contended had acted outside the scope of her duties and authorisation in offering these video recordings and news segments to clients. She had since resigned and the defendants were unable to locate her. [70] DW3 then sought to explain the trap purchases. He maintained that the two transactions had been conducted outside the scope of the standard operating procedures of the defendants. Again DW3 maintained that the sales person, Ally had been keen to earn a commission and exaggerated MediaBanc's activities to the private investigator, PW5. [71] DW3 closed his examination-in-chief by explaining that MediaBanc had not sought to 'misrepresent' to the public in Singapore that the defendants are part of the MediaCorp group. This he explained was because the first MediaBanc company was incorporated in 1997, some 26 months before the first MediaCorp company. [72] In the course of cross-examination, DW3 was asked how the MediaBanc group recorded various programmes. A specific example of a news programme from Channel NewsAsia was suggested. DW3 responded by explaining that in 2006 the defendants would have recorded the programme onto a VHS tape, but that in 2009 it would be directly onto a computer. On further questioning he explained that the VHS tape would then have been archived in that time, while on the computer it would be recorded onto the 6 MLJ 657 at 684 hard disc. DW3 explained that no editing was done unless there were key messages that had to be picked up. In editing, DW3 explained that a computer programme allowing them to 'cut in' and 'cut out' was utilised. These edited news clippings were then archived separately. [73] It was put to DW3 that the guarding and measuring or surveillance function he had talked about would normally be carried out by a public relations agency. DW3 replied that while that might have been true many years ago, it was not possible today for the reasons he had set out in examination-in-chief. When pressed

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further on this point, namely that the functions carried out by the defendants was the same as that of a public relations company, he responded by stating that a PR agency's main function is to strategise communication while media monitoring is part of the communications process. [74] DW3 was asked whether, if a licence fee was due to the media owner, the defendants would build that cost into their fees. His response was that they might or might not. It would depend on the contract signed. He agreed that the defendants' companies would absorb a portion of the costs of the licence fees paid to the media owners. [75] DW3 was then referred to the email from the defendants' country manager, one Ivan Chong to a client, one Desiree Lim (at p 640 of the bundle B). Desiree Lim he explained was a retainer client for print monitoring. He was asked to confirm that she received copies of video clips from the plaintiffs' news programmes in March 2009. DW3 refused to confirm that. When the email in issue was put directly to him, DW3 responded by saying that all that had been provided was an MIS report and that a direction had been given to approach the media owners directly. When pressed further, DW3 maintained that he was unable to confirm whether the defendant did or did not provide video clips to Desiree. A perusal of the relevant email from Ivan Chong to Desiree Lim dated 25 March 2009 states as follows:
... Dear Desiree, Yes the material that provided by us will only meant for Internal Research and Review purpose. Should you need to broadcast or show to the third party, you may need to purchase the copyright (for external use) from the media owner. Currently MediaBanc is the SPH's copyright distributor, as for MediaCorp, you will need to contact them directly ...

[76] It was then put to DW3 that an article entitled When Information is King, which was linked to the defendants' webpage, which contained an error, namely that MediaBanc had obtained a licence from MediaCorp for the use of its materials, served to mislead persons into believing that the MediaCorp material provided by MediaBanc was licensed. DW3 agreed with that but 6 MLJ 657 at 685 maintained that the error had been corrected and that they had sent letters out to the 'core' of the Singapore market to advise them. DW3 was unable, however to produce any of those letters. [77] DW3 was then referred once again to p 619 of the bundle B, an invoice to one PR Communications Pte Ltd, and asked whether the clippings referred to in that invoice, which were all the plaintiffs' programmes, were sold at $25 per clip. DW3 was unable to answer the question stating that he was unsure that the document was an invoice (notwithstanding that the document is headed 'Invoice' at the top). He also said that he did not know what the $25 was for. [78] DW3 was then referred to advertising material on the defendants' group of companies at pp 477-482 of the bundle B. He was asked whether the price list at p 481 were standardised fees. DW3 explained that these were merely approximate fees or suggested fees. He maintained that there was no fixed for or retainer fee for video clips. [79] The prices for the trap purchase were then put to DW3. He was also asked to confirm that when an ad hoc request was made, the defendants would provide the details as well as the video clips found. DW3 agreed. He also agreed that the sum of $120 was the price on an ad hoc request for a video clip alone. [80] With respect to the trap purchases, it was put to DW3 that given his testimony above, the trap purchases did not comprise business outside of the standard operating procedure of the defendants as ad hoc video clips were provided at a price of $120 per clip. DW3 however disagreed with this. [81] DW3 was also questioned on the discussions between the plaintiffs and the defendants in relation to the quantum of the licensing fee sought by the plaintiffs. DW3 maintained that in 2004-2005 the parties had a discussion where the licensing fee sought was two and a half times the defendants' revenue. In the 2007 discussions, DW3 contended that the fee sought amounted to about 140%-150% of the defendants' revenue. It was then put to him that the formula presented was on a 'per clip' basis as opposed to a flat fee. DW3 agreed. It was then put to him that the price suggested was in the range of $50 per clip. Again DW3 agreed

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stating that it was in the region of $52 per clip. [82] DW3 was then queried on whether a client could access data stored in the MIS. DW3 replied that they could not have access to the recorded programmes and news. However the defendants would be able to access the archive and provide it within a time frame ranging from two weeks to 30 days. DW3 also explained on being questioned, that material recorded for a client 6 MLJ 657 at 686 was not stored indefinitely but in CD format for about six months and if in VHS format for about 28 days or one month. It was however put to him that this was not possible as in the trap purchase scenario, the defendants had been able to provide data more than one year prior to the recording. DW3 explained this by maintaining that the information requested for was from a retainer client, for whom material was stored for up to a year or so. DW3 also explained that the video clips were sourced from the archive by the use of a search through keywords. [83] Reference was made to DW3's earlier evidence that the defendants' clients were advised that the video clips were strictly for their own viewing and research purposes. He was asked where on their invoices or delivery orders or their website it was stated that they provided these clips. DW3 conceded that he could not recall anywhere in their advertising material that such a warning was carried. DW3 relied on two cases where queries for the video clips were referred back to MediaCorp Singapore. [84] It was next put to DW3 that the defendants had succeeded so well in their media monitoring business because of the low pricing of its material. DW3 disagreed. He also disagreed that he would still be able to conduct the defendants' business successfully if their products were priced slightly higher. The other witnesses for the defence [85] The other witnesses for the defence, namely Badri bin Mohamad Saaid, DW1 ('DW1') a marketing director with a sports marketing consultant, Choy Su Ling, DW2 ('DW2') a public relations consultant, and Ghazalie Saw bin Abdullah, DW4 ('DW4') a public relations consultant all related why in the course of their work and other activities, media monitoring assumed such an important role. They also explained their need for the edited news 'clippings' or segments provided by the defendants which assisted them in their daily duties and functions. [86] In cross-examination most of the defendants' witnesses testified that they relied upon the clippings or segments made available by the defendants from recordings of the plaintiffs' broadcasts to comprehend and accurately summarise the data and news contained in such broadcasts. For example DW1 maintained that as a sports marketing public relations consultant, his clients would have to indicate precise details of the segment of the broadcast involving his client. Such details would include the hours, minutes and milliseconds of the appearance of the relevant footage in order to justify sponsorship. In order to provide such details, it was necessary for the public relations consultants to view the footage. More significantly, DW1 maintained that they needed the visual segments as corroborative proof. 6 MLJ 657 at 687 [87] DW2 similarly confirmed that the visual segments comprised an important part of her research work in relation to dance performances. If such segments were not available, she confirmed that her research would be delayed considerably and that costs incurred would increase as she would need to find ways of procuring such information and paying for the same. DW4 testified that the media monitoring services provided by the MediaBanc group of companies was extremely useful market intelligence which public relations firms depended on to articulate the news and thereby fulfil their function. He explained in cross-examination, that a report from the defendants comprised an Excel sheet indicating the various news coverage for the day. If the client had a retainer with the defendants, it would get in addition, scanned television news clippings in video form and clippings from the internet which would be emailed with a link. He also confirmed that if a retainer were sought for one event only, then he would receive clippings of all coverage of that event. Usually he was advised if a royalty fee was payable to the media owner and that would be included in the cost of the retainer. He further confirmed that the clippings he received would be forwarded to the end-client. Like DW2 he maintained that if such clippings were not available from the defendants he would be forced to source

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them independently. He testified that it was not easy to procure such recordings as television stations do not provide that service. [88] After the defendants' four witnesses had testified, the defendants then closed their case. This then comprises a summary of the evidence adduced by the plaintiffs and the defendants respectively. From this evidence as set out earlier several issues arose for consideration. The issues are set out below again for ease of reference: Issues (a) (b) (c) Have the plaintiffs established ownership of copyright in the television and radio news programmes produced and broadcast by them? Have the defendants infringed the plaintiffs' copyright in the works above, and if so which acts of the defendants constitute infringement? Is the defence of fair use/fair dealing available to the defendants?

Have the plaintiffs established ownership of copyright in the television and radio news programmes ie the works broadcast by them? [89] The original works comprising the subject matter in this case are the news programmes on television produced by the plaintiffs, more particularly the first plaintiff ('television news programmes') and the radio programmes produced by the plaintiffs, more particularly the second plaintiff ('radio programmes'). Notwithstanding that the plaintiffs seek protection for all television news programmes and radio programmes, for the purposes of this 6 MLJ 657 at 688 trial they produced in evidence four full television news programmes of 30 minutes each, which were annexed to an affidavit in compliance with s 42 of the Copyright Act 1987. The declarant was PW6 and the affidavit was produced in court by PW7. These four compact discs therefore comprised the true copies of four television programmes produced by PW1. The plaintiffs also produced through PW5, ie vide the trap purchases, infringing copies namely exhs P2A, P2B, P2C and P2D. There was therefore before the court a true copy of the four television programmes by way of sample/example of the continuous television programmes produced by the plaintiffs, as well as segments or clips comprising what they claimed were infringing copies. On the basis of the production of these four true copies (exh P-10) and the four infringing copies (exhs P2A-P2D) the plaintiffs seek protection for all television news programmes produced by them. Additionally the plaintiffs also seek in similar manner protection for all radio programmes produced by them. [90] The question that arises for consideration is whether the plaintiffs have indeed established that they are the owners of copyright in the aforementioned television news and radio programmes. The relevant provisions of the act required to establish ownership/subsistence of copyright in the news programmes [91] Under the provisions of the Copyright Act 1987 ('the Act') copyright can be established in a multitude of ways. The plaintiffs' contention is that by establishing that they own the copyright in the four compact discs exhibited as P10, they are then entitled to seek by way of extrapolation a finding of this court that all television news programmes and radio programmes produced by them are equally entitled to such protection under the provisions of the Act. [92] The television news programmes therefore refer to the television news programmes produced by Channel NewsAsia, as well as news bulletins broadcast on Channel 5, Channel 8, Channel U, Suria and Central. The onus is on the plaintiffs to establish that they are the owners of copyright in all television news programmes broadcast on these channels. As for the radio programmes, they refer to radio broadcasts in four different languages over the airwaves in Singapore, namely Gold 90.5FM, Class 95FM, 98.7FM, 93.8LIVE, Symphony 92.4FM, Lush 99.5FM, Capital 95.8FM, Oli 96.8FM, FM96.3 The International

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Channel, Radio Singapore International and SmartRadio. Where the television news programmes and radio programmes include content from third parties, the first and second plaintiffs maintain that they have contracted licence agreements with the requisite parties. What then are the relevant provisions of the Act to establish copyright in the instant case? 6 MLJ 657 at 689 [93] Section 7(1) prescribes 'works' eligible for copyright:
Subject to this section, the following works shall be eligible for copyright: (a) (b) (c) (d) (e) (f) literary works; musical works; artistic works; films; sound recordings; and broadcasts.

[94] In the instant case the plaintiffs seek copyright protection in respect of: (a) (b) the broadcast of the television news programmes; as well as film and sound recordings in the pre-recorded segments comprising a part of the television news programmes.

[95] With respect to the radio programmes, the plaintiffs seek copyright protection in respect of: (a) (b) the broadcast of the radio programmes; and sound recordings in the radio programmes. We shall consider the establishment of copyright in the television news programmes first, followed by the radio programmes.

The law in relation to establishing copyright entitlement in the television news programmes [96] Consideration will be given first to the plaintiffs' claim for copyright protection in respect of the broadcasts of the television news programmes followed by their claim to copyright protection in respect of the pre-recorded segments which comprise a part of the news programmes. The pre-recorded segments refer to the segments of the news programmes that are not live and that are recorded before the news programmes are aired and are added to become a part of the entire 30 minutes programme. Turning to the law, by virtue of s 7, the television news programmes fall within the definition of 'works' eligible for copyright as they are broadcasts. Additionally the pre-recorded segments are 'works' eligible for copyright protection as they comprise 'films' and 'sound recordings' as defined above in s 7. [97] The next relevant section is s 10(1) of the Act which provides that 'Copyright shall subsist in every work eligible for copyright of which the author or in 6 MLJ 657 at 690 the case of a work of joint authorship, any of the authors is, at the time when the work is made, a qualified person'. (Emphasis added.) [98] How are the words 'author' and 'qualified person' defined in the Act? Section 3 of the Act provides that:
'author' -(f) (i) (ii) in relation to broadcasts transmitted from within any country, means -the person transmitting the programme, if he has responsibility for the selection of its contents; or any person providing the programme who makes with the person transmitting it the arrangements

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necessary for its transmission; ...

[99] In relation to films or sound recordings the 'author' means the person by whom the arrangements for the making of the film or recording were undertaken. [100] A 'qualified person' is also defined in s 3. It specifies that 'in relation to a body corporate means a body corporate established in Malaysia and constituted or vested with legal personality under the laws of Malaysia' while in relation to an individual it means a person who is a citizen or permanent resident in Malaysia. [101] In the context of broadcasts, it appears that the Act envisages that copyright may well subsist and be owned by a body corporate, rather than an individual. This is further borne out by the provisions of s 10(2) which stipulate that:
Copyright shall also subsist in every work which is eligible for copyright and which -(c) being a broadcast is transmitted from Malaysia.

[102] It follows that a broadcast is more likely to be transmitted by a body corporate rather than an individual. [102] And 'broadcast' means:
... a transmission by wire or wireless means, of visual images, sounds or other information which -(a) (b) is capable of being lawfully received by members of the public; or is transmitted for presentation to members of the public;

6 MLJ 657 at 691 [103] From the composite application of the foregoing provisions, it follows that broadcasts from Malaysia produced by a body corporate in Malaysia are entitled to copyright protection under the Act. In the instant case however, the plaintiffs are Singaporean, being bodies corporate incorporated in Singapore and transmitting from Singapore. [104] However s 59A of the Act provides as follows:

(1)

The Minister may make regulations applying any of the provisions of this Act specified in the regulations, in relation to a country so specified in the regulations (which in this section is referred to as the 'specified country') which may or may not be a party to a treaty or a member of any Convention or Union relating to copyright or performers' rights to which Malaysia is also a party or a member, so as to secure that those provisions -(a) apply in relation to literary, musical or artistic works, or films or sound recordings, or published editions of literary, musical or artistic works first published in that specified country as they apply in relation to literary, musical or artistic works, or films or sound recordings, or published editions of literary, musical or artistic works first published in Malaysia; ... apply in relation to broadcasts transmitted from that specified country as they apply in relation to broadcasts transmitted from Malaysia.

(c) (d)

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[105] Following upon this the Minister has made regulations allowing for the applicability of the Act to be extended to foreigners, ie individuals or companies incorporated in foreign jurisdictions in the form of the Copyright (Application to Other Countries) Regulations 1990 ('the Regulations'). Broadcasts appear to be governed by reg 4 which stipulates as follows:
4

(1)

Subject to these Regulations, the provisions of the Act shall apply in relation to -(a) (b) ... broadcasts transmitted from a country specified in broadcasts transmitted from Malaysia.

Schedule 2 as they apply in relation to

[106] 'A country specified in Schedule 2' is defined as 'All countries that are Members of the World Trade Organisation'. Singapore is a member of the World Trade Organisation. It would therefore appear on a perusal of s 59A, 6 MLJ 657 at 692 reg 4(1)(b) and Schedule 2 that broadcasts transmitted from Singapore are entitled to protection under the Act in as much as broadcasts transmitted from Malaysia. [107] As for the pre-recorded segments comprising a part of, or an inherent part of the television news programmes, reg 3(a) appears to be relevant. It provides as follows:
3(a) Subject to these Regulations the provisions of the Act shall apply in relation to literary, musical or artistic works or films first published in the respective specified countries as they apply in relation to literary, musical or artistic works, or films first published in Malaysia.

[108] 'Specified countries' is defined in s 2 to mean 'the countries which are members of the Berne Convention'. Singapore is a signatory to the Berne Convention. Therefore it would follow that films first published in Singapore would enjoy the same copyright protection as films first published in Malaysia. [109] What about the sound recordings in the pre-recorded film segments in respect of which the plaintiffs seeks copyright protection? As pointed out by learned counsel for the defendants, Mr Thompson, 'film' is defined in s 3 as:
means any fixation of a sequence of visual images on material of any description, whether translucent or not, so as to be capable by use of that material with or without any assistance of any contrivance --

of being shown as a moving picture; or of being recorded on other material, whether translucent or not by the use of which it can be so shown, and includes the sounds embodied in any soundtrack associated with a film; ...

(a) (b)

[110] It would therefore follow that there is no 'separate' sound recording in the television news programmes. The sound recordings in the pre-recorded segments of film, by virtue of the definition of 'film' above become a part of the film works. As such it would appear that the issue of a separate entitlement to protection for purely 'sound' copyright in the television news programmes does not arise. The plaintiffs can only seek to claim copyright protection in respect of the pre-recorded film segments comprising a part of the television news programmes, whereby the sound recordings inherent therein will be accorded protection as being a part of the pre-recorded segment.

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6 MLJ 657 at 693 Proof of copyright in relation to the 'broadcasts' of the 'television news programmes' Establishing copyright through ss 7, 10, 3 and 59A of the Act read together with reg 4(1)(b) of the Regulations [111] First consideration is given to proof of copyright in relation to broadcasts of the television news programmes. From the various definitions set out above, it is evident that the 'author' of a broadcast of the television news programmes would be either the person or corporate entity transmitting the programme if he or it has responsibility for the selection of the contents of those television news programmes, or anyone providing the programme who works together with the person transmitting it. It would therefore follow that the 'author' of a broadcast is the producer of the broadcast. In the context of the television news programmes therefore the author is the producer of those news programmes. For purposes of the television news programmes it is therefore sufficient for the purposes of establishing copyright, for the 'author' of the broadcast, ie the producer to give evidence that it is the entity responsible for the production of the television news programmes. [112] How did the plaintiffs in the instant case seek to establish copyright in the 'broadcasts' of the television news programmes? The plaintiffs have sought to prove ownership of copyright by establishing that presently it is the fourth plaintiff ie MediaCorp Pte Ltd that owns the copyright in the broadcasts of the television news programmes as such copyright was assigned to it on 1 April 2008 by the first plaintiff. [113] In order to establish that copyright subsisted in the first plaintiff prior to the assignment to the fourth plaintiff as of 1 April 2008, the plaintiffs relied on PW6 to establish such ownership. PW6, it will be recalled is the Assistant Vice President of Business Development of the fourth plaintiff. PW4 is also the holding company of all the other plaintiffs. [114] PW6 in his capacity as the representative of the MediaCorp group of companies, ie all the plaintiffs, explained in the course of his evidence, inter alia, that the first plaintiff was the producer of all the television news programmes. He explained that the third plaintiff and MediaCorp TV12 Singapore Pte Ltd had entered into commissioning agreements (which were referred to in court) with the first plaintiff to produce all news bulletins broadcast on Channel 5, Channel 8, Channel U, Suria and Central. The first plaintiff owns and operates Channel NewsAsia. In short all the television news programmes are therefore produced by the first plaintiff. 6 MLJ 657 at 694 [115] Further and in any event, it is an agreed fact between the parties that the first plaintiff owns and manages Channel NewsAsia and Channel NewsAsia International and is a producer of news and current affairs programmes in the South East Asian region. [116] As such at all material times in 2006, the first plaintiff was the producer and therefore the 'author' of the broadcasts of the television news programmes as it was responsible for the transmission of those news programmes. This fact was not challenged by the defendants during the course of cross-examination. [117] As referred to at the outset, on 1 April 2008, PW6 testified that all of the first plaintiff's copyright ownership in the broadcasts was assigned to the fourth plaintiff wholly. The plaintiffs did not produce the assignment to further evidence this fact. However the fact of assignment was also not challenged in the course of cross-examination by the defendants. In these circumstances it would appear that by virtue of establishing that the first plaintiff was the producer of all the television news programmes and that it subsequently assigned all those rights to the fourth plaintiff, the plaintiffs have established authorship in those news programmes entitling such works, ie the broadcasts of the television news programmes to be eligible for copyright protection under the Act. Proof of copyright in the broadcasts vide s 42 of the Act [118] The plaintiffs also sought to comply with s 42 of the Act. The section provides:

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(1)

An affidavit or statutory declaration made before any person having authority to administer oath by or on behalf of any person claiming to be -(a) (i) (ii) (iii) the owner of the copyright in any works eligible for copyright under this Act stating that -at the time specified herein copyright subsisted in such work; he or the person named therein is the owner of the copyright; and a copy of the work annexed thereto is the true copy thereof; or

(b)

...

shall be admissible in evidence [in] any proceedings under this Act and shall be prima facie evidence of the facts contained therein. 6 MLJ 657 at 695 [119] PW6 affirmed a statutory declaration wherein he asserted that he was making the declaration on behalf of the fourth plaintiff. In para 4 he affirmed that the fourth plaintiff through its employees was the producer of the news programmes which comprised the 'works'. True copies of the 'works' marked as exhs CJY1, CJY2, CJY3 and CJY4 which were stored electronically in four digital video discs were annexed. [120] Segments comprising approximately two or more minutes from these 30 minutes programmes were copied or recorded by the defendants and were a part of the trap purchases initiated by the plaintiffs. In short exhs P2A-P2D were the infringing copies while the discs annexed to P42 were the true copies. [121] In accordance with s 42 therefore it follows that PW6 had made a statutory declaration on behalf of the fourth plaintiff which is the owner of the copyright in the television news programmes described as the 'works' and annexed a true copy of those works to exh P10. This, the plaintiffs contended, amounted to establishing prima facie title to copyright in the said four 30 minutes television news programmes. Premised on establishing such prima facie copyright, it was contended that the onus shifted to the defendants to rebut such ownership. Additionally on the basis that ownership in the four thirty minute segments of news programmes had been established, the plaintiffs sought, as stated at the outset, an extrapolation of the court's findings on copyright to be extended to the broadcasts of all television news programmes. Establishing film copyright in the pre-recorded segments of the television news programmes Sections 26, 10, 3, 59A of the Act and reg 4(1)(b) of the Regulations [122] As explained earlier, the pre-recorded segments comprise an inherent part, or composite part of the television news programmes. The plaintiffs sought to establish copyright in these pre-recorded segments by establishing that the authors of these pre-recorded segments were employees of the first plaintiff who had by virtue of s 26(2)(b), made or authored these segments in the course of their work as employees and that therefore the copyright in those film segments belonged to th first plaintiff. [123] By virtue of the provisions of s 26(1) of the Copyright Act 1987 ('the Act') copyright conferred by s 10 shall vest initially in the 'author'. Section 26(2)(b) provides that where the 'works' were made in the course of employment, ownership is deemed transferred to the employer. In the context of the pre-recorded film segments, this has to refer to the pre-recorded segments contained in the four true copies of the 30 minutes segments 6 MLJ 657 at 696 exhibited as CJY1, CJY2, CJY3 and CJY4 in exh P10 (the 'works' cannot refer to exhs P2A-P2D because those are the 'infringing' copies).

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[124] In his statutory declaration, P10, PW6 affirmed in para 5, the names of the editors or producers of the four 30 minutes news programmes. He also affirmed that these four editors or producers were employees of the first plaintiff at the time those news programmes were made in 2006. This issue of fact was not challenged in the course of cross-examination. [125] By virtue of s 26 therefore, as the works were made in the course of the author or producer's employment, it was deemed transferred to the first plaintiff. This brings us to the question of who the 'author' of the pre-recorded film segments is. Section 3 defines the 'author' in relation to films or sound recordings as the person by whom the arrangements for the making of the film or recording were undertaken. Accordingly it would follow that the editors or producers were the persons by whom the arrangements for the making of the film or recordings were undertaken. Therefore as of 2006 the copyright for these 'works' subsisted with the first plaintiff and were assigned to the fourth plaintiff as of 1 April 2008. Thereby film copyright in the pre-recorded segments of the four television news segments appears to be established. The plaintiffs, as is the case with the broadcast copyright, seeks an extrapolation of the finding of this court to extend to all the television news programmes. Proof of broadcast and sound recording copyright in the radio programmes [126] The modus of establishing radio copyright would have been essentially the same. It was open to the plaintiffs to establish broadcast copyright in the radio programmes by establishing that the second plaintiff is the 'producer' of all the radio programmes as defined above, and that it assigned all such copyright to the fourth plaintiff as of 1 April 2008. [127] PW6 did in fact give considerable evidence to this effect in the course of his examination-in-chief. He testified that the second plaintiff 'rightfully' owns the MediaCorp produced content in all the news, information and entertainment radio programmes offered by its stations. However unlike the case of the television news programmes, no copies of any of the 'works', ie recordings of the radio programmes were produced. In the case of the television news programmes it will be recalled PW6 relied on exh P10 in which four true copies of the news programmes were annexed thereby enabling the plaintiffs to establish prima facie evidence of entitlement to copyright in those news programmes. In the case of the radio programmes however, there are no true copies of the broadcast of the radio programmes or a reduction into fixed form of the sound recordings of such radio programmes. In short there is no object or copy which the court can refer to as the 'works' in respect of which broadcast 6 MLJ 657 at 697 and sound copyright protection is sought. Neither is there compliance with the provisions of s 42 which require that a 'true copy' of the 'work' in respect of which copyright protection is sought, is annexed. [128] The plaintiffs meet this objection raised by the defendants by contending that a copy of the radio broadcasts is indeed before this court in the form of exhs P2A, P2B, P2C and P2D. However the radio excerpts or programmes were not played in court, nor referred to. More significantly however, such samples of the radio programmes, even if available in P2A-P2D, comprise a part of the 'infringing' copies as they comprise copies procured from the defendants. Section 42 envisages that a true copy of the works be produced by the plaintiffs to establish prima facie subsistence and ownership of copyright. Accordingly the requirements of that section and the other sections of the Act are not met. In order to establish copyright in the radio programmes it was incumbent upon the plaintiffs to produce a true copy of, at least, some radio programmes, as they did for the television news programmes. [129] It would be entirely inequitable, in the face of the pleadings in the instant case, where the establishment of copyright is heavily challenged, for this court to hold that the provision of samples of the television news programmes in itself is sufficient to evidence proof of subsistence and ownership of copyright in the radio programmes. Neither is it acceptable, in view of the minimum requirements in s 42 for this court to rely on exhs P2A-P2D. The court ought to have for its reference a true copy in conjunction with the infringing copy to enable a comparison to be undertaken. [130] In so far as the sound recording in the radio programmes is concerned, it would have been necessary for the plaintiffs in light of the definition of 'sound recording' to produce 'any fixation of a sequence of sounds

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or of a representation of sounds capable of being perceived aurally and of being reproduced by any means, ...'. No such sound recording of the radio programmes was either played in court or produced. [131] I therefore conclude that in so far as the radio programmes are concerned, the plaintiffs have failed, by reason of their failure to produce a true copy of the recording of any of the radio programmes, to establish broadcast copyright. [132] On an examination of the totality of the plaintiffs' evidence therefore, it appears that they have established ownership of broadcast copyright in the four news programmes exhibited in court via P10. Equally they have established film copyright in the pre-recorded segments of the said four news programmes. It appears to this court, as a matter of proof that the production of a sample of four of the fourth plaintiff's complete 30 minutes news 6 MLJ 657 at 698 programmes aired on television, does comprise sufficient example/sample of their ownership in such television news programmes. The plaintiffs produce television news programmes continuously on many television channels. It would not be reasonable nor practical to expect them to produce every news programme they produced (not to speak of future productions) in order to enable them to seek protection under the Act. The provisions of the Act appear to my mind to provide protection to, inter alia, countries in the World Trade Organisation as well as those that are signatories to the Berne Convention. Accordingly proof of subsistence and entitlement to copyright should not be made so onerous, nor such a hurdle that lawful persons or corporations, otherwise entitled to assert copyright, are constrained, or face evidential difficulties in proving copyright. Having said that, it is equally clear, as I stated at the outset, that the Act envisages and allows for several different modes of establishing copyright, the simplest being through s 42. [133] With the application of s 59A of the Act considered in conjunction with reg 4(1)(a) and (b) of the Copyright (Application to Other Countries) Regulations 1990 ('the Regulations') it would appear that the television news programmes broadcast in Singapore enjoy protection as they were first published or broadcasted in Malaysia. In Honda Giken Kogyo Kabushiki Kaisha v Allied Pacific Motor (M) Sdn Bhd & Anor [2005] 3 MLJ 30; [2005] 6 CLJ 174, it was held:
... With fresh amendments reg 59A was inserted by the Copyright Act 1990 (Act 775), purposefully enacted to enable Malaysia to fulfil its obligation under the Berne Convention, whereupon the result was the promulgation of the Copyright (Applications to Other Countries) Regulations 1990. The latter regulations were to accord copyright protection to works that originated from member state countries. Regulation 3 specifically enacts that ... Regulation 1(2) provides that all the regulations, and by necessity to include the above reg 3, apply in relation to works made before the commencement of these regulations as they apply in relation to works made thereafter. As I understand it this provision is retroactive as well as prospective in effect. The total effect of the two regulations is that any work from a specified country, regardless of time, if eligible for copyright protection under the Copyright Act 1987, will be accorded protection whether it did enjoy protection or not in that specified country. (Emphasis added.)

The contentions of the defendants as to why copyright is not established [134] I have in the course of examining the law and the evidence led in this case, covered to some extent, some of the objections raised by the defendants. I shall now proceed to consider the rest of their contentions as to why they 6 MLJ 657 at 699 maintain the plaintiffs have not established copyright in the television news programmes and the radio programmes (for completion, notwithstanding that I have concluded that the plaintiffs have not established subsistence and ownership of copyright in the radio programmes). [135] The defendants pointed to the following deficiencies and discrepancies in the plaintiffs' evidence which they contended precluded the plaintiffs' from asserting copyright as discussed above.

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[136] They point out that the plaintiffs only produced the digital video clips marked as exhs P2A, 2B, 2C and 2D through PW5. These were the same clips produced by PW6 in the course of his evidence. No other clips or recordings were adduced or played in court by the plaintiffs. The defendants submit that the failure of the plaintiffs to produce the 'original works' which they claim to have been infringed means that they have not provided the court with any evidence to believe in the existence of the plaintiffs' original work. In essence the defendants maintain that it is incumbent on the plaintiffs to show sufficient objective similarity, a causal connection and 'substantial part' between the original work and the infringing copy. This, the defendants maintain can only be done if the original works and the infringing copies are before the court. [137] In response to this submission, the plaintiffs sought to reopen their case. Having been allowed to do so, they then tendered a declaration by PW6 under s 42 of the Act, which enclosed the four full news programmes, marked as exhs CJY1, CJY2, CJY3 and CJY4. These four programmes comprised samples of the original television news programmes. As such it would appear that the original works for the broadcast of the plaintiffs' four television news programmes were available in court for purposes of comparison. Therefore the defendants' contention that there were no original works in relation to the television news programmes is not accurate. [138] The defendants maintain however that the statutory declaration sworn by PW6 was not tendered through him, but through another employee of the plaintiffs, ie PW7. To my mind this in itself does not invalidate the effect of the statutory declaration or its contents. This is particularly so as the defendants made no objection on these grounds to the admission of the declaration during the course of the trial. Neither was there cross-examination on this point when the s 42 declaration was tendered. Given the lack of objection at the time when the declaration was tendered, it appears that these factors do not serve to invalidate the value of P10. Error in the s 42 statutory declaration [139] The defendants also point out that the statutory declaration attributes 6 MLJ 657 at 700 copyright in the works to 'the Media Shoppe Berhad' which is not one of the plaintiffs in the suit. The plaintiffs however have explained this, stating that the use of that name was a typographical error. Although careless, this appears to be the case, as PW6, the declarant had previously set out the full picture in relation to the subsistence and devolution of copyright from the first and second plaintiffs to the fourth plaintiff. Contradiction between pleadings and evidence adduced through PW6 [140] Next the defendants point to the fact that in their pleadings, the plaintiffs' limited copyright ownership to the first and second plaintiffs, while at trial it was explained that copyright in both the television news programmes and the radio programmes subsisted in the fourth plaintiff. The defendants' complaint is that no amendments were, made to the pleadings to reflect such change. Again during the course of the trial, there was no cross-examination directed at PW6 on this point. Nor was PW6 challenged on the assignment of copyright to the fourth plaintiff or asked to produce this document in court. Given the lack of objection to PW6's evidence on ownership of copyright, and the lack of cross-examination on this point, it appears that PW6's evidence was accepted in totality on this point. His evidence was that the first plaintiff and the second plaintiff assigned their copyright in the television news programmes and the radio programmes to the fourth plaintiff on 1 April 2008. As such PW6's unchallenged and uncontradicted evidence remains on record in court. It is undisputed evidence of copyright having vested in the fourth plaintiff as of 1 April 2008. Therefore this evidence cannot be ignored and prevails, notwithstanding the seeming contradiction with the pleadings. Section 42(2) of the Act [141] The defendants' complaint that the plaintiffs have failed to comply with s 42(2) of the Act which provides that: 'Any person who is authorized to act on behalf of the owner of the copyright for the purposes of subsection (1) shall be required to produce such authorization in writing.' Their specific complaint is that the plaintiffs failed to provide such written authorisation in their statutory declaration which disqualifies the contents from being prima facie proof of the facts contained therein.

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[142] It will be recalled that the declaration was made by PW6. Prior to this statutory declaration being tendered, PW6 had given evidence for the better part of a day explaining that he was the Assistant Vice President of Business Development of the fourth plaintiff and specifically authorised to give evidence on its behalf. PW6 stated on oath that he had personal knowledge of the plaintiffs' claim as well as information derived from the documents of the plaintiffs to which he had access. He states in para 12 of P10 that he, on behalf 6 MLJ 657 at 701 of the fourth plaintiff, asserts the fourth plaintiff's ownership of copyright in the four television news programmes. It was evident from the tenor and content of his evidence that he was fully authorised to give evidence on behalf of all the plaintiffs, including the fourth plaintiff. His authorisation was not in issue. PW6 was moreover, cross-examined at some length by learned counsel for the defendants. In the course of such cross-examination his authorisation was never questioned nor challenged. As such, the attempt, somewhat belatedly after trial, to impute that PW6 was not authorised to give evidence on behalf of the fourth plaintiff appears to be an afterthought. [143] Learned counsel for the defendants referred to the case of Solid Gold Publishers Sdn Bhd v Chan Wee Ho & Ors [1998] 5 CLJ 735 where Suriyadi Halim Omar J (now JCA) held that s 42(2) is an evidential requirement which is mandatory in nature. His Lordship held in that case that the section meant that a non-production of the authorisation document would not qualify the contents of the relevant affidavit to be prima facie proof of the facts contained therein. In that case the plaintiffs applied ex parte for an Anton Piller order and did not produce the alleged exclusive licence conferred on them by the principal owners. Further their s 42 affidavit claiming eligibility for copyright was submitted by an agent of the plaintiffs. There was no letter authorising the said agent to act for the plaintiffs. The affidavits did not show any authority conferred on them to act on behalf of the other company. [144] The facts in Solid Gold are quite different from the facts at hand in the instant case. Here the plaintiffs, who are all inter-related, being a part of the MediaCorp group claim to be the principal owners of copyright in the television news programmes and the radio programmes. PW6 is a senior employee of the fourth plaintiff and gave evidence on behalf of the entire MediaCorp group at trial. Most significantly, his authorisation was not challenged or questioned at any stage, either during the course of his evidence, or when the statutuory declaration he had made was tendered through PW7. This notwithstanding that he was cross-examined at some length on all other matters in relation to the production of television news programmes and radio programmes by the plaintiffs. In short, it was evident from the cross-examination undertaken that his authority or authorisation to act on behalf of the plaintiffs was not in issue at any stage during the trial. [145] The instant case is further distinguishable from the Solid Gold case in that that was an application for an Anton Piller injunction while the instant case was a full trial. This afforded the defendants every opportunity to challenge PW6. Having accepted his testimony on behalf of the plaintiffs, it appears to be somewhat belatedly raised that PW6 was not authorised to make the statutory declaration on behalf of the plaintiffs. The defendants' stance appears to be an attempt to technically preclude the plaintiffs from establishing 6 MLJ 657 at 702 copyright. The mandatory requirements of s 42(2) are imperative where the statutory declaration provides the sole documentary basis on which the court must rely to establish copyright. In the instant case, PW6 had given extensive evidence for the basis of the plaintiffs' claim. It is not a case, like Solid Gold, where the plaintiffs are relying solely on the statutory declaration in itself to establish ownership. On the facts of the instant case, the s 42 declaration is significant because the true copies of the 'works' requiring copyright protection are annexed thereto. As for the rest of the statutory declaration, PW6 had given evidence for the better part of a day on these issues. Despite this, no issue was taken as to his capacity or authorisation to speak on behalf of the plaintiffs. Therefore the only logical conclusion to be drawn is that PW6 was indeed authorised to give evidence on behalf of the plaintiffs, including the fourth plaintiff, and to make the statutory declaration on behalf of the fourth plaintiff. As such, the statutory declaration appears to be valid as PW6 was authorised to make it. No deed of assignment produced in court

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[146] The defendants contend that by virtue of s 27(3) of the Act no assignment of copyright shall have effect unless it is in writing. Accordingly television news programmes to the fourth plaintiff ought to have been produced. It is contended that the court is bound to satisfy itself as to the existence of the assignment in writing before it can give effect to the assignment claimed to subsist. It is pertinent again that in the instant case, PW6 was not at any stage challenged as to the fact of the assignment. PW6 gave evidence that the first plaintiff had validly assigned all copyright in the television news programmes to the fourth plaintiff. This portion of his evidence was not challenged. Neither did the defendants seek production of the written assignment. Even when the s 42 statement was produced where PW6 was the declarant, no questions were put to PW7 who tendered the declaration. In the absence of any cross-examination of PW6 on this point and the acceptance of PW6's sworn statement in P10, this court has no option but to conclude that PW6's evidence stands accepted by the defendants, as does the declaration establishing prima facie title to copyright. Nature of the exhibits annexed to the statutory declaration [147] The defendants contend that exhs CJY1-CJY4 are recordings of four television news programmes which have been selected by the plaintiffs as examples of true copies of these works. It is not disputed by both parties that these are recordings of the plaintiffs' television news broadcasts. However the defendants maintain that: (a) (b) none of these exhibits are in respect of the radio programmes; and 6 MLJ 657 at 703 these exhibits are also not copies of 'films' as defined under the Act as they are not copies of the pre-recorded segments the plaintiffs created.

[148] With regards to (a), as discussed earlier, it is evident that no true copies of recordings from the plaintiffs' radio programmes have been played or produced to this court which would enable it to compare the infringing copies (P2A-P2D) with true copies. The evidence is deficient to that extent. [149] With regards to (b), what the defendants are saying is that if the plaintiffs seek copyright film protection in relation to the pre-recorded segments in their television news programmes, then they ought to have produced samples of only the pre-recorded segments before the court. [150] It appears to this court that the true copies of the four television news programmes which are eligble for broadcast copyright protection, also inherently contain film rights in the pre-recorded segments which are eligible for protection. However the defendants contend that if the plaintiffs' recording of the broadcast is to qualify as a 'film', in terms of chronology of creation the broadcast would have had to come first before the recording. This would have been a physical impossibility, as the defendants could not have recorded the plaintiffs' film of the broadcast before the broadcast was embodied in a material form and made into a film. [151] Notwithstanding this contention however, in view of the plaintiffs' evidence (not in issue) that their television news programmes contain both pre-recorded segments as well as 'live' segments, it follows that inherent in the broadcast of these television programmes are film rights which arise by reason of the pre-recorded film segments that are amalgamated with other segments to become the composite television news programme. The pre-recorded segments are eligible for film copyright and true copies of the same have been produced by the plaintiffs vide CJY1-CJY4. [152] As such the plaintiffs have produced evidence of works eligible for broadcast copyright protection and film protection in their television news programmes in the form of the exhs CJY1-CJY4. Devolution of title [153] The defendants maintain that there are actual gaps in the devolution of copyright title from the authors (as initial owners) to the plaintiffs. Referring to the statutory declaration, exh P10, they point to the fact that PW6 merely avers to a belief that pursuant to the provisions of the Singapore Copyright Act, the copyright in the said works have been deemed transferred to the first plaintiff 'from the dates of their respective creation to first April 2008'. The

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6 MLJ 657 at 704 reference to these dates clearly refers to the fact that the works were deemed transferred from the producer or author to the first plaintiff until 1 April 2008 when copyright was assigned to the fourth plaintiff. This corroborates the evidence of PW6 who explained at length in the course of examination-in-chief that copyright in the broadcast of the television news programmes initially subsisted in the first plaintiff but was assigned to the fourth plaintiff on 1 April 2008. The basis for subsistence of broadcast copyright in the news programmes has been explained at some length earlier. [154] The defendants next point to the fact that PW6 stated in his evidence that commissioning agreements were entered into in 2005 and 2006 which show that the first plaintiff was acting pursuant to a commission by the third plaintiff. As such it is contended that by reason of the existence of such commission agreements that copyright would have been transferred to the third plaintiff rather than subsisting in the first plaintiff. Further the defendants contend that if copyright indeed subsisted in the third plaintiff, then the first plaintiff could not have assigned such copyright to the fourth plaintiff as of 1 April 2008, thereby throwing considerable doubt on the contention that copyright now vests in the fourth plaintiff. [155] A perusal of PW6's evidence during examination-in-chief and in the course of his statutory declaration clearly stipulate that at all times before 1 April 2008, copyright broadcast in the four television news programmes produced subsisted in the first plaintiff. PW6 did not assert, in the course of his evidence that copyright subsisted or vested in the third plaintiff. This proposition was not put to him. The defendants did not cross-examine PW6 on this point, nor challenge the assertion that copyright subsisted in the first plaintiff. The failure to cross-examine the defendants on what they now contend is an important issue precludes them from making this submission at this stage. At no time was it put to PW6 that contrary to what he was saying, copyright actually subsisted in the third plaintiff. In fact the subsistence of copyright in the fourth plaintiff was not directly challenged by the defendants in the course of the trial. Accordingly this submission is without merit. Omission of the name of the owner of the copyright [156] The defendants complain that in exh P10, PW6 failed to mention who the claimed owner of copyright is, in breach of s 42(1)(a)(ii) of the Act. It is further submitted that there are several candidates who could be the owner of copyright resulting in clear ambiguity in the s 42 declaration contained in exh P10. [157] A perusal of P10 discloses that: (a) (b) PW6 makes specific reference to four 'works' being four 30 minutes television news programmes. 6 MLJ 657 at 705 PW6 explains that the producers or authors of those four 'works' are one Bhagman Singh, Cheryl Lim, Hwee Goh and Cheryl Lim. At all material times these four producers were employees of the first plaintiff. As a consequence by virtue of s 26, the copyright in the said works were deemed transferred from the individual producers or authors to their employer, the first plaintiff. As of 1 April 2008, PW6 affirmed that the copyright was assigned from the first to the fourth plaintiff. Again in para 10, PW6 deposes to the fact that by virtue of the provisions of the Singapore Copyright Act, the copyright in those four specific news programmes were deemed transferred to the first plaintiff as and when they were created. This remained so until 1 April 2008 when the copyright was assigned to the fourth plaintiff.

(c) (d)

[158] As such it is apparent from the contents of the statutory declaration that PW6, the declarant has clearly deposed to the chain of creation and subsistence of copyright as well as devolution of such copyright to the fourth plaintiff as of 1 April 2008. It is therefore inaccurate, on the basis of P10 to contend that there has been an omission to stipulate the name of the owner of copyright. Does 'illegality' impact on the subsistence and/or enforcement of copyright?

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[159] It is the submission of the defendants that in analysing whether the plaintiffs are entitled to enforce broadcast copyright, consideration must be given to the fact that broadcasting must necessarily be done by a broadcasting service. Accordingly it is contended that not only must the work satisfy the definition of 'broadcast' in s 3, but also of 'broadcasting service', before it can be said that the work belongs to the relevant category of protected works. And in the event the broadcaster does not satisfy the definition of 'broadcasting service' then the requirements for copyright to subsist in Malaysia are not made out. 'Broadcast' is defined in s 3 as follows:
... a transmission, by wire or wireless means, of visual images, sounds or other information which --

(a) (b)

is capable of being lawfully received by members of the public; or is transmitted for presentation to members of the public and includes the transmission of encrypted signals where the means for decrypting are provided to he public by the broadcasting service or with its consent.

6 MLJ 657 at 706 [160] Broadcasting service is defined as 'any service of radio or television broadcast, operated under the general direction and control of or under licence by the Government, in any part of Malaysia'. [161] As such it is contended that ambiguity arises in trying to apply the provisions of the Copyright (Applications to Other Countries) Regulations because: (a) Regulation 4(1)(e) provides that 'the provisions of the Act shall apply in relation to persons who, at the material time, are citizens of, or residents in, a country specified in Schedule 2, as they apply in relation to persons who, at such a time, are citizens or permanent residents in Malaysia'. The defendants contend that this means that while the 'author' or producer of the broadcast could be a foreigner, this does not impinge upon the requirement that the broadcasting service has to be operated under the general direction and control of or under licence by the government, in any part of Malaysia. In short it is contended that in order to be entitled to broadcast copyright a foreign entity falling within Schedule 2 would still have to have a licence to broadcast in Malaysia, failing which the Regulations would not apply.

[162] In response to this the plaintiffs point to s 59A(1)(d) and reg 4(1)(b) of the Regulations which clearly stipulate that all countries who are members of the World Trade Organisation enjoy broadcasting rights in Malaysia which are capable of protection under the Act in the same manner as Malaysian broadcasters are protected in Malaysia. [163] Having considered these competing contentions, it falls upon the court to construe the relevant provisions of the Act and the Regulations to ascertain the intent of Parliament in promulgating the same. Section 59A(1)(d) clearly envisages that the Minister is empowered to make regulations applying any of the provisions of the Act in relation to a specified country so as to secure that the provisions of the Act apply equally to that country so as to afford it different forms of copyright protection in Malaysia. Vis-a-vis broadcasts, s 59A(1)(d) expressly provides that the Minister may make regulations which apply in relation to broadcasts transmitted from that specified country as they apply in relation to broadcasts transmitted from Malaysia. [164] Such an express provision clearly denotes that the section allows and enables the Minister to afford protection to broadcasts transmitted from 'a specified country' as if those broadcasts were transmitted from Malaysia. It does not in any manner limit such protection to broadcasts from a 'specified country' where that foreign corporation or citizen enjoys or holds a Malaysian licence entitling it to broadcast. 6 MLJ 657 at 707 [165] Further the words in s 59A(1)(d) clearly envisage that the protection is afforded in relation to broadcasts from that specified country, Singapore in the instant case. If the construction urged by the

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defendant were to be adopted by this court, this would result in no broadcasts from any of the specified countries enjoying any form of copyright protection under the Act, save and unless those particular foreign entities, albeit corporations or citizens possessed a licence from the Malaysian Government. Such a construction appears to be contrary to the express words and purpose of s 59A(1)(d) and reg 4(1)(b). [166] In any event the definition of a 'broadcasting service' appears to refer to any service of a radio or television broadcast, operated under licence by the government in any part of Malaysia. The existence of the words 'in any part of Malaysia' appear to qualify that this is a reference to broadcasting services in Malaysia. The plaintiffs' broadcasting service is in Singapore, although its broadcasts may be viewed and heard in Malaysia by reason of the transmission of its visual images and sounds. It appears that the definition of a 'broadcasting service' is therefore not directly applicable nor relevant when construing and applying s 59A(1)(d) and reg 4(1)(b). [167] A purposive construction ought to be given to the said section which seeks to confer protection under the Act reciprocally to specified countries, namely those that are part of the World Trade Organisation. To deny such a specified country protection under the Act would be akin to divesting s 59A and reg 4(1)(b) of its conferment of reciprocity. This would detract from the express words and purpose of those sections because the words used are simple and direct. The words used provide simply that broadcasts transmitted from those countries are entitled to protection equal to that of Malaysian broadcasts under the Act. The defendants appear to be reading into reg 4(1)(b) the additional mandatory requirement that the plaintiffs are required to be licensed in Malaysia in order to enjoy protection under the Act. There appears to be no reasonable basis for imposing such a severe mandatory requirement into s 59A(1)(d) and reg 4(1)(b) when there are no express words to that effect. [168] The defendants also make reference to a footnote in Professor Khaw Lake Tee's comprehensive and learned treatise, Copyright Law in Malaysia, (3rd Ed), published by LexisNexis, where Professor Khaw states:
It should be noted that 'broadcasts' are not within the scope of the Berne Convention. However, Malaysia extended copyright protection in broadcasts to the United Kingdom in 1994 and subsequently all WTO member countries in 2000 ... This means that notwithstanding the recognition of foreign authorship with respect to broadcasts, not all broadcasts transmitted from abroad enjoy copyright in this country unless they come within the terms of s 10 of the Copyright Act 1987.

6 MLJ 657 at 708 [169] As discussed earlier, the plaintiffs' broadcasts in relation to their television news programmes fall within the purview of s 10 in that they are eligible for copyright protection under the Act. Being Singaporean, they are eligible for copyright protection by virtue of the reciprocity and conferment of protection provision in s 59A and the Regulations. It is not the case that foreign broadcasts from specified corporations which otherwise fall within the definition of s 10 of the Act, save for the fact of being non-Malaysian, do not qualify for protection simply because they are foreign. As stated above, this would completely deprive s 59A of its express purpose. Accordingly I am unable to agree with the contention of the defendants that in order to enjoy protection under the Act, the plaintiffs must be armed with, or possessed of a licence from the Malaysian Government licensing them to broadcast in Malaysia. Is there a breach of the Communications and Multimedia Act 1998 ('CMA') which either vitiates the subsistence of copyright or precludes enforcement of the plaintiffs' claim? [170] The defendants contends that the plaintiffs have breached the CMA and as a consequence the subsistence of copyright is vitiated. Alternatively the court ought to deny the plaintiffs protection and not enforce their claim. [171] ln support of this contention the defendants contend that the Berne Convention does not provide for copyright in broadcasts. It is instead the International Convention for the Protection of Performers, Producers of Phonograms and Broadcasting Organisations ('the Rome Convention') which provided for copyright in broadcasts. Neither Malaysia nor Singapore is a signatory to the Rome Convention.

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[172] This contention does not encroach upon the express provisions of s 59A(1)(d) or reg 4(1)(b). It is not open to this court to ignore those provisions which clearly stipulate that copyright protection is conferred upon broadcasts transmitted by any country which is a member of the World Trade Organisation, as any such Malaysian broadcast would be entitled to under the Act. [173] Secondly the defendants contend that there are anomalies in the Regulations. Such regulations it is contended were initially promulgated to give effect to Malaysia's obligations under the Berne Convention in reg 2. Subsequently the defendants contend, through amendments in 1994 and 2000, the Regulations have been used as a vehicle to extend protection for sound recordings and broadcasts through what they term 'minor' amendments to the schedules even if those rights are not under the Berne Convention and 6 MLJ 657 at 709 even though the main regulation itself has not been suitably amended to indicate the other treaties or conventions that the regulation appears to be serving. [174] In essence the complaint of the defendants pertains to the drafting of the Regulations. This is, for the purposes of the instant case, to be contrasted with the construction and purpose of the Regulations. As they currently read, s 59A(1)(d) and reg 4(1)(b) clearly and expressly provide for broadcast copyright protection under the Act to be conferred on specified countries. The so-called 'deficiencies' in the drafting, if they do exist, do not detract from the clear and simple meaning to be accorded, namely reciprocity of protection in keeping with the fundamental premise behind international intellectual property treaties, namely the concept of national or equal treatment, whereby a foreigner enjoys exactly the same treatment accorded to a country's own nationals. [175] Thirdly the defendants press home the point that it is in the interests of the Malaysian Government and all other governments to control what is broadcast in their own countries. There is, it is contended far greater importance in the content of a broadcast as opposed to that in a literary, artistic or musical work which attracts copyright. PW6 in the course of his evidence confirmed that the plaintiffs conformed to all censorship and licensing requirements in Singapore but that he was unaware of any such efforts being made with regards to Malaysian advertising codes, content codes or censorship guidelines. As such the defendants put this forward as one more reason why broadcast copyright protection ought not be granted to the plaintiffs. It is necessary, they maintain, that in order to enjoy such protection the foreign broadcaster must have complied specifically with Malaysian licensing and censorship guidelines. [176] Again such a contention would run awry of the express provisions of s 59A(1)(d) as well as reg 4(1)(b). If requirements such as licensing and adherence to Malaysian codes were mandatory, there would have been express provision or qualification to this effect in the Regulations or in the Act. There are no such qualifications or provisos. In the absence of any such qualifications it would, as I have said previously, seriously detract from and distort the very purpose of those sections if reciprocity and protection were disallowed on these grounds. Such a construction would be irrational and fail to meet or adhere to the purpose for which those Regulations were promulgated. This contention of the defendants is therefore also dismissed. Are the plaintiffs' broadcasts tainted with illegality precluding them from being claiming protection under the Act? [177] Essentially the defendants contend that as the plaintiffs have 6 MLJ 657 at 710 contravened the provisions of the CMA by failing to be in possession of the relevant licence to broadcast in Malaysia, their broadcasts are tainted with illegality, thereby precluding them from enjoying protection under the Act. This contention is premised on the basis that there has in fact been a contravention of the CMA and other like provisions governing the broadcast of materials in or from Malaysia. As discussed above, the plaintiffs have complied with the licensing laws in their own country and seek reciprocal broadcast protection by virtue of the express provisions of the Act, ie s 59A (1)(d) coupled with reg 4(1)(b). As the plaintiffs are broadcasting from Singapore, there is no requirement that they must be licensed in Malaysia. The provisions of the CMA as well as the definition of a 'broadcasting service' envisage broadcasts conducted from or in Malaysia. As such, it does not irreversibly follow that the plaintiffs have acted illegally or committed an

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offence under the CMA simply because their broadcasts, which emanate from Singapore, can be picked up in Malaysia. Section 4 of the CMA states as follows:

(1) (2)

This Act and its subsidiary legislation apply both within and outside Malaysia. Notwithstanding subsection (1), this Act and its subsidiary legislation shall apply to any person beyond the geographical limits of Malaysia and her territorial waters if such person -(a) is a licensee under this Act; or (b) provides relevant facilities or services under this Act in a place within Malaysia. (c) ... (d) ...

[178] Pursuant to the above section the CMA is applicable to a person who provides relevant facilities or services under the CMA in or from a place within Malaysia. [179] 'A place' is defined in s 4(3) of the CMA as the air space above the territorial jurisdiction of the land of Malaysia or the waters off the shores of Malaysia that are considered Malaysian waters. [180] Therefore in my view, in relation to a broadcaster, the CMA ought only apply to a person or entity who provides the source of the broadcast ie the equipment required for broadcasting services within the air space above the territorial jurisdiction, the air space above the waters of the shores of Malaysia that are considered Malaysian waters, and from within the territorial jurisdiction of the land and waters of Malaysia. 6 MLJ 657 at 711 [181] The plaintiffs do not fall within the definition above as the source of the plaintiffs' broadcasts is Singapore. It is not in dispute that the broadcasts of the television news programmes are broadcast out of Singapore and that the first and second plaintiffs are licensed broadcasters in Singapore. As such the plaintiffs are not a network service provider in Malaysia with which the CMA is concerned. As such the contention of a contravention of the CMA does not come into play as it is inapplicable to the plaintiffs. [182] I have concluded prior to this that the plaintiffs are not in contravention of the CMA and other licensing and censorship codes and requirements for the same reason, namely that the plaintiffs are not broadcasting from or in Malaysia but from or in Singapore. However their broadcasts are, entirely involuntarily, caught in parts of Malaysia. The plaintiffs are not therefore a 'broadcasting service' in Malaysia. As such, on the facts of this case, they are not in contravention of the CMA and other like legislation or regulations. Their entitlement to protection is entirely statutory and arises from the express provisions of the Act and the Regulations. [183] It cannot be said that there has been a blatant or flagrant contravention of the CMA, primarily because the plaintiffs' broadcasts do not emanate from Malaysia. The plaintiffs' broadcasts emanate from a reciprocating country, ie a member of the World Trade Organisation, thereby affording it express protection under the provisions of the Act in Malaysia. The situation could not be more different. Accordingly that line of reasoning, namely that an illegality taints the plaintiffs' entitlement to copyright broadcast is flawed. There is no illegality in the instant case which would have any such effect. Even if I am wrong in concluding that the plaintiffs are not in contravention of the provisions of the CMA, it follows that any such illegality as is occasioned does not taint the plaintiffs' broadcasts to the extent of depriving the plaintiffs of copyright protection under the express provisions of the Act. Authority for this proposition is to be found in the Federal Court decision of Asia Television Ltd & Anor v Viwa Video Sdn Bhd & Connected Cases [1984] 2 MLJ 304. In that case, in order for distributors of Hong Kong originating Chinese serials to qualify for copyright protection, they had to 'publish' ie sell or distribute the video to the public within 30 days of the first publication in Hong Kong. However in most cases, it was not possible to obtain approval certificates from the censorship board within the 30 days period. Accordingly there was a contravention of the Films (Censorship) Act 1952. The issue for consideration was whether the distributors could claim protection under the Copyright Act in view of the contravention of the provisions of the Films (Censorship) Act 1952. The Federal

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Court considered this issue and held as follows:

... We would pause to observe in view of the 30 days period provided for in s 2(2)(c) of the Copyright Act, that if the provisions of the Films (Censorship) Act with regard to the necessary certificates are an essential prerequisite to the acquisition of 6 MLJ 657 at 712 copyright then it may well be unlikely that in the vast majority of cases any copyright can accrue under the provisions of s 6(1)(a) of the Copyright Act, as the vitiating effect of any delay on the part of the Board of Film Censors would rebound on the heads of innocent claimants of copyright under the Copyright Act. On a careful evaluation of the relevant and requisite statutory provisions and a consideration of the question of any interplay between them we can find no sufficient nexus as would satisfy the test laid down in Curragh Investments Ltd v Cook [1974] 3 All ER 658. There is no prohibition in either of the Acts which would preclude the appellants from acquiring copyright if they are otherwise qualified although they may be in breach of the provisions of the Films (Censorship) Act which is concerned only with criminal liability and provides a penalty for breach of its relevant provisions. If it were otherwise so as to result in the defeasance of the appellants' rights under the Copyright Act in this case, then it would be equally logical to deprive a person of his rights under that Act if he commits an offence of strict or vicarious liability, such as for instance an offence under the excise laws, without any intention or mens rea. In the light of the matters we have adumbrated we accordingly find that non-compliance with the provisions of the Films (Censorship) Act does not affect the acquisition of copyright under the Copyright Act. Any infringement of the provisions of the former Act attracts the criminal penalty provided for therein, but if this were also to result in defeating the appellants' rights under the Copyright Act the implications in the matter of economic loss would far exceed the penalty imposable for contravening the censorship requirements of the earlier Act. As we have pointed out there is no express or implied prohibition linking the respective requirements of the two statutes and accordingly no nexus to justify reading them conjunctively and importing the requirements of one as a condition precedent to the operation of the other. (Emphasis added.)

[184] Applying the foregoing reasoning to the instant case, even if the plaintiffs are in breach of the provisions of the CMA, this in itself would be insufficient to deprive them of broadcast copyright protection under the Act, but would, at most, attract the penalties provided for under the CMA itself. In other words, the illegality would not broadly taint the broadcasts precluding them from enjoying copyright protection. The rationale for this is clear. The plaintiffs here are eligible for copyright protection under the Act. They are not broadcasting from Malaysia. Even if there is a contravention of the CMA, the plaintiffs are entirely without mens rea in 'committing' any such illegality. The non-compliance with the provisions of the CMA does not therefore act to deprive or divest the plaintiffs of their entitlement to broadcast copyright protection. Did the defendants' acts constitute infringement? [185] In the course of setting out the evidence adduced by both the plaintiffs and the defendants, it was apparent from the evidence of the plaintiffs' witnesses as well as DW3 that in January 2006 the plaintiffs discovered that the defendants were recording, copying, storing and then editing, compiling, 6 MLJ 657 at 713 selling and distributing the plaintiffs' television news programmes in the course of providing their media monitoring services. DW3 himself explained that in order to ensure that the data that was compiled from all media sources was accurate, broadcasts, including that of the plaintiffs' are recorded and replayed to verify the accuracy of the data being collected, prior to it being archived. It is therefore not in issue that the defendants do record and store, albeit they maintain for a limited time, the plaintiffs' broadcasts of their television news programmes. Additionally the defendants also edit and compile short but complete segments of the television news programmes in the form of DVDs or CDs which are attached to their media monitoring reports for an additional fee. Section 15 of the Act provides that 'copyright in a broadcast shall be the exclusive right to control in Malaysia the recording, the reproduction, and the rebroadcasting, of the whole or a substantial part of the broadcast, and the performance, showing or playing to the public in a place where an admission fee is charged of the whole or a substantial part of a television broadcast either in its original form or in any way recognizably derived from the original'. [186] Subsection (2) provides that 'Notwithstanding subsection s 13(1), paras s 13(2)(a), (g), (gg), (ggg), (gggg), (h) and (o) shall also apply to the copyright in a broadcast'. [187] And sub-s (3) provides that 'the copyright in a television broadcast includes the right to control the

Page 50

taking of still photographs from such broadcasts'. [188] It therefore follows that as the plaintiffs enjoy broadcast copyright protection under the Act, the defendants are not at liberty to record, reproduce a substantial part of the broadcast either in its original form or in any way recognisably derived from the original, unless they have the express permission or a licence from the plaintiffs. It is not in dispute that they possess no such licence or sanction. [189] Subsection (2) however qualifies the right of control stipulated in sub-s (1) and specifies circumstances which are exempt or excluded from such copyright control. For example, s 13(2)(a) provides that the right of control vis-a-vis copyright in a broadcast does not include the right to control the recording or reproduction of such broadcasts which are by way of 'fair dealing for the purposes of non-profit research, private study, criticism, review or the reporting of current events, subject to the condition that if such use is public, it is accompanied by an acknowledgement of the title of the work and its authorship, except where the work is in connection with the doing of any of such acts for the purposes of non-profit research, private study and the reporting of current events by means of a sound recording, film or broadcast; ...' 6 MLJ 657 at 714 [190] The other subsections of s 13(2) similarly detail the specific circumstances and situations which are exempt from copyright control as particularised in s 15 of the Act. These provisions now fall to be applied in relation to the present factual matrix. [191] From the evidence of the plaintiffs' witnesses and DW3 it is apparent that the acts of the defendants in, inter alia: (a) (b) Recording all the television news programmes broadcast by the plaintiffs. Reproducing a 'substantial' part of those broadcasts, ie entire segments of the television news programmes or news clips in the form of DVDs or compact discs, such that these segments are recognisable in their original form or as having been derived from the original amount to an infringement of the plaintiffs' copyright in those broadcasts. As explained earlier, the plaintiffs have produced four such television news programmes by way of example, and seek protection in respect of all television news programmes on the same basis.

[192] Such infringement is further borne out by: (a) The evidence of PW3 who testified that in June 2006 she received an email from the TMC Educational Group Pte Ltd to the effect that they had been approached by one 'MediaBanc Singapore' in reality the first defendant who offered for sale clips of a television broadcast on the TMC group which had been aired on the plaintiffs' television channels. This evidences the fact that the defendants record, store and sell a substantial part of the plaintiffs' television programmes in original form or a form close to the original without a licence to do so. The offer was made for a stipulated price; PW1 gave evidence that in July 2006 she received an email which she forwarded to her superior. In that email Victoria School stated that they had been approached by 'MediaBanc Singapore' ie the first defendant, which offered for sale clips of television broadcast coverage on the school which was aired on the plaintiffs' television channels. Although this email comprises hearsay evidence, as the Victoria School did not attend to give evidence of this fact, such evidence was not challenged in substance in the course of cross-examination, leading to the conclusion that it is in substance, true. Again it amounts to evidence of the defendants having recorded and reproduced substantial portions of the plaintiffs' broadcasts in original form or close to it; The two trap purchases conducted against the defendants in September and October 2006 by private investigators hired by the 6 MLJ 657 at 715 plaintiffs provide clear evidence of the fact that the defendants recorded, copied wholly, stored/archived, edited and reproduced substantial segments of the plaintiffs' broadcasts over various dates. The copies purchased by the plaintiffs comprise clear evidence of this fact as

(b)

(c)

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(d)

(e)

(f)

borne out by exhs P2A, P2B, P2C and P2D. Further the defendants charged a fee for the service of retrieving those particular segments and providing copies of the same; PW4 gave evidence that in January 2007 an entity known as Adam Khoo Learning Technologies had been approached by an employee of the defendants offering for sale a sound clip of a news story which featured an interview with one of the institution's teachers. The sale price of the news clip offered was S$65; PW2 gave evidence that in April 2007 she received an email from the Ministry of National Development of Singapore ('MNDS') advising that MNDS was approached by the defendants and was offered for sale television broadcast news clips which had been aired on several of the plaintiffs' television channels earlier on that month. Again items (d); and Provide clear evidence that the defendants have in their possession copies of broadcasts recorded from the plaintiffs' television news channels. It follows therefore that the defendants had recorded, copied, compiled and stored copies of such broadcasts for use in terms of sale to the public.

[193] It is evident from the foregoing, and particularly the evidence of DW3 (which has been outlined in detail earlier on in the judgment) that the plaintiffs continuously record, copy, compile, archive, edit and sell copies of a substantial part of the plaintiffs' broadcasts to the public in a form which is recognisably derived from the original. DW3 admits recording and copying the plaintiffs' television news programmes in their entirety (as well as their radio programmes) as well as selling and distributing segments and clippings to their clients. This is further evidenced by para 12(a) of the agreed facts apart from DW3's evidence. The defendants' acts of copying the news programmes in totality for the purposes of compiling, storing, editing and selling or reproducing segments for sale is an act that infringes the plaintiffs' broadcast copyright as well as their film copyright in the pre-recorded segments of those broadcasts. [194] However it must be borne in mind that sub-s (2) of s 15 exempts such reproduction and use of such broadcasted copies in certain specific circumstances as outlined in that section and detailed above. The defendants maintain in this context that their use of the copies of the broadcasts of the plaintiffs' television news programmes falls within the definition of 'fair 6 MLJ 657 at 716 dealing' within the context of s 13(2)(a) of the Act. It now falls to be considered whether the defendants can rely on this defence of fair dealing in response to the plaintiffs' claim of an infringement of copyright which has been established in relation to the broadcasts of its television news programmes. The defence of fair use/fair dealing [195] In his comprehensive submissions, learned counsel for the defendant, Mr Benjamin Thompson submits that the court is bound to appreciate that unlike trademarks, patents and industrial designs which provide true monopolies to the registrant, copyright merely gives the owner a right not to be copied and for the copier not to derive the benefit due to the owner if used for competing purposes. The reason why copyright law is not a monopoly is because inherent in the law is the need for a balance between the copyright owner's right to protect his economic benefit, and the need for society to progress in the development of its creativity and ideas without undue restriction. As stated by Lord Mansfield in Sayre v Moore (1785) 102 ER 139n :
We must take care to guard against two extremes equally prejudicial: The one, that men of ability, who have employed their time for the service of the community, may not be deprived of their just merits, and the reward of their ingenuity and labour; The other, that the word may not be deprived of improvements, nor the progress of the arts be retarded.

[196] In order to achieve this balance between the copyright owner and the public interest of society at large the law has made provision in the form of s 13 of the Act where the five exclusive rights of the copyright

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owner granted under the Act are qualified by twenty exceptions where the copyright owner has no such right of control. [197] As set out above, the general head of fair dealing under the Act is in s 13(2)(a) which is reproduced above. The defendants contend that if the foregoing defence under s 13(2)(a) is made out and the defendants' use is deemed to be use for either one or more purposes of non-profit research, private study, criticism, review or the reporting of current events, the plaintiffs will not be able to assert control over the acts of the defendants and the defendants would not need the consent, permission or licence of the plaintiffs to use the copyright works. How do the defendants' actions give rise to the defence of 'fair use/fair dealing' under the Act? [198] DW3 gave evidence that there are two broad aspects to the defendants' business: (a) (b) data processing and statistical analysis; and 6 MLJ 657 at 717 providing outsourcing services for the monitoring of the media. [199] The defendants provide their services in the following manner: (a) (b) (c) (d) (e) (f) Clients are provided with excerpts of the audio or video recordings at the request, sufficient in length to convey the information as to the context in which their company or brand was mentioned. The source of the excerpt is acknowledged as required in order to qualify for fair use. This is achieved by adding to the excerpt an extract from the beginning of the programme and another extract from the end of the programme. The watermark or other identifier of the television station broadcasting the programme is in no way obliterated or distorted. The excerpt is digitally compressed before being provided to the clients to ensure that the quality of the excerpt is reduced and rendered unsuitable to be used for rebroadcasting or recording. The defendants maintain that they charge their clients only in respect of the costs of compilation, editing and delivery, but not for the excerpt per se. The defendants do not sell or offer for sale copies of entire news programmes. They only provide clips or extracts relating to the particular item of news of interest or benefit to the client.

[200] In these circumstances, the defendants maintain that as they conduct a media monitoring business as opposed to a broadcasting business, their recording and compilation of the plaintiffs' television news programmes amounts to fair dealing within the purview of s 13(2)(a). [201] The plaintiffs on the other hand argue that the act of recording the entire news programmes off air, even if permitted under normal circumstances, becomes an unlawful and infringing act if the purpose for which the recording is done is, in itself, an infringement of the plaintiffs' rights. They point to the fact that the purpose of the defendants recording the television news programmes is, inter alia, to edit and compress and provide copies of the video clips or sound bytes as comprising an integral part of the media monitoring report provided by them. Such an act, they maintain clearly infringes the exclusive rights of the plaintiff as stated in s 15 which clearly provides that only the plaintiffs enjoy the rights of reproduction of the whole or a substantial part of the broadcast in any material form, communication to the public and 6 MLJ 657 at 718 distribution of copies to the public by sale. The law in relation to fair dealing [202] Section 13(2)(a) precludes the copyright owner from asserting control vis-a-vis his rights where the reproduction, communication, distribution or sale to the public of the copyrighted work is by way of 'fair dealing for the purposes of non-profit research, private study, criticism, review or the reporting of current events ...' (the section goes on to specify the need for acknowledgement of title of the work where the 'fair'

Page 53

use is public, save when such use is for the purposes of non-profit research, private study and the reporting of current events vide sound recording, film or broadcast). [203] In other words where the use of the copyrighted work is for the purpose of non-profit research, private study, criticism, review or the reporting of current events, such use is exempt from copyright control under the Act. The section is drafted so as to specify with particularity the only circumstances or occasions of use which would qualify for exemption, namely non-profit research, private study, criticism, review or the reporting of current events. The section does not provide for a broad and unspecified category of acts of 'fair dealing' or use, of which the circumstances of non-profit research, private study, criticism, review or the reporting of current events provide some specific examples. This is evident from the fact that the words 'fair dealing' are immediately qualified by the words 'for the purposes of' and followed by the specific events or circumstances in which copyright control is precluded. [204] As stated by Professor Khaw Lake Tee in her erudite treatise Copyright Law in Malaysia, (3rd Ed), LexisNexis:
In Beloff v Pressdram Ltd and another [1973] 1 All ER 241, Ungoed Thomas J referred to the defence of fair dealing in s 6 of the former Copyright Act 1956 and said that such use or dealing must be: ... directed to and consequently limited to and be judged in relation to the approved purposes. It is dealing which is fair for the approved purposes and not dealing which might be fair for some other purpose or fair in general.

[205] The learned author also made reference to the case of Pro Sieben Media AG v Carlton Television Ltd [1998] FSR 43 where Laddie J stated that the fair dealing provisions of the UK Copyright, Designs and Patents Act 1988 '... are not to be regarded as mere examples of a general wide discretion vested in the courts to refuse to enforce copyright where they believe such refusal to be fair and reasonable'. 6 MLJ 657 at 719 [206] It is therefore clear that under the Act fair dealing is qualified by the purpose for which such dealing is done, namely non-profit research, private study, criticism, review or the reporting of current events. As such the next issue for consideration is which of the categories the defendants rely upon to establish 'fair dealing'. From the thrust of the defendants' submissions they seem to contend that their dealing with the plaintiffs' television news programmes falls within the purview of non-profit research, or review or the reporting of current events. In other words, the defendants appear to contend that their acts amount to fair dealing for the purpose of non-profit research and/or fair dealing for the purpose of review or fair dealing for the purpose of reporting current events. Therefore the definition or meaning of each of these categories of 'fair dealing' falls to be considered. [207] Before considering those specific purposes however it is also necessary to comprehend the phrase 'fair dealing'. It is not defined under the Act. Unlike other jurisdictions, for example Singapore and Australia, the factors to be taken into consideration in determining whether a dealing amounts to a 'fair' dealing have not been set out in the Act. [208] In the oft-quoted case of Hubbard and another v Vosper and another [1972] 1 All ER 1023 at p 1027 Lord Denning MR said:
It is impossible to define what is 'fair dealing'. It must be a question of degree. You must consider first the number and extent of the quotations and extracts. Are they altogether too many and too long to be fair? Then you must consider the use made of them. If they are used as a basis for comment, criticism or review that may be fair dealing. If they are used to convey the same information as the author, for a rival purpose that may be unfair. Next you must consider the proportions. To take long extracts and attach short comments may be unfair. But short extracts and long comments may be fair. Other considerations may come to mind also. But, after all is said and done, it must be a matter of impression. As with fair comment in the law of libel, so with fair dealing in the law of copyright. The tribunal of fact must decide.

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[209] Again in the Beloff v Pressdram Ltd and another [1973] 1 All ER 241 Ungoed-Thomas J said with regards to fair dealing:
... fair dealing is a question of fact and of impression, to which factors that are relevant include the extent of the quotation and its proportion to comment (which may be justifiable although the quotation is of the whole work); whether the work is unpublished; and the extent to which the work has been circularised, although not published to the public within the meaning of the Copyright Act 1956.

[210] In Sillitoe v McGraw-Hill Book Company (UK) Ltd [1983] 9 FSR 545 the court adopted Lord Denning MR's judgment in Hubbard and another v Vosper and another and concluded that fair dealing is a matter of impression. 6 MLJ 657 at 720 [211] Unlike the provisions of the copyright statutes in the United Kingdom at that time and the current position in Malaysia in relation to fair dealing as set out in s 13(2)(a), which prescribes a fairly narrow exception to the prohibition against the infringement of copyright, the position in the United States is somewhat different. In that jurisdiction four factors are statutorily provided, the application of which will enable a determination of whether a use is fair. These four factors are the purpose and character of the use, including whether the use is of a commercial nature or is for non-profit educational purposes, the nature of the copyrighted work, the amount and substantiality of the portion used and the effect of the use upon the potential market for or value of the copyrighted work. The various purposes set out there, namely criticism, comment, news reporting, teaching scholarship or research are referred to as examples of fair use but do not serve to provide the defining limits for 'fair dealing', unlike the position under the Act in Malaysia. To that extent the definition of 'fair dealing' in that jurisdiction is considerably wider than in Malaysia under the Act. [212] In a decision of the United States Court of Appeals for the Ninth Circuit, Kelly v Arriba Soft Corporation 336 F 3d 811 the court deliberated on the defence of 'fair use' in a situation where the defendant had reduced images of the plaintiff's art into low resolution 'thumbnail' images. The court found that although the defendant made exact replicates of the plaintiff's images, the thumbnails were much smaller, lower resolution images that served an entirely different function than the original images. While the plaintiff's images served an aesthetic purpose the defendant's search engine provider thumbnails were unrelated to any such aesthetic purpose but was designed to help index and improve access to images on the internet. The users were unlikely to enlarge the thumbnails and use them for artistic purposes because the thumbnails were of a much lower resolution than the originals making them inappropriate as display material. The court also found that given the thumbnails' lack of artistic purpose, their use did not stifle creativity. Applying the various factors available under their statute, the appellate court determined that two of the factors stated there weighed in favour of the defendant which was sufficient for a finding of fair use. [213] Unlike the situation in the United States of America, the Act does not allow for 'fair dealing' to be assessed by considering a broad category of circumstances and ascertaining whether those circumstances conform to a set of statutory guidelines. On the contrary, fair dealing under the Act is confined to 'fair dealing' for the prescribed purposes set out in that section and no more. The aforesaid case therefore has to be read in the context of application of the statutory test provided in that jurisdiction. 6 MLJ 657 at 721 [214] In Singapore the existence of s 35(2) of the Singapore Copyright Act assists in establishing fair dealing. In the case of Aztech Systems Pte Ltd v Creative Technology Ltd [1996] 1 SLR 683 the court applied the section which provides that for the purposes of determining whether a dealing constitutes a fair dealing with the work the following facts are relevant:
(a) (b) (c) (d) the purpose and character of the dealing, including whether such dealing is of a commercial nature or is for non-profit educational purposes; the nature of the work ...; the amount and substantiality of the part copied taken in relation to the whole work...; and the effect of the dealing upon the potential market for, or value of, the work ...

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[215] When all the different tests in different jurisdictions are considered a vein of commonality is clearly discernible throughout, albeit in the statutorily encapsulated tests or in the case law on the subject. It can therefore be no different in this jurisdiction. What then is the test to be applied in determining whether the use of a copyrighted broadcast amounts to 'fair dealing' within the purview of the Act? It is imperative to incorporate the vein of commonality evident in all jurisdictions in formulating such a test. It is also important to bear in mind that fair dealing within s 13(2) cannot be dissected from the purposes for which it is permitted as discussed previously. Bearing in consideration these significant factors, the matters to be considered in determining whether a use or dealing is 'fair dealing' within the Act includes the following factors: (a) (b) (c) (d) (e) (f) the purpose of the dealing and whether it falls within the specified exceptions in s 13(2)(a); the nature of the work; whether it can be said that a substantial part of the work has been copied or utilised when compared with the original work; on an objective assessment what is the impression created by the reproduced/copied dealing; the effect of such dealing upon the potential market for, or value of the work; what is the motive of the party in its dealing with the work.

[216] On an application of the foregoing to the current facts, the following conclusions result: (a) The purpose of the dealing is for the purposes of the defendants' media 6 MLJ 657 at 722 monitoring business. The issue of whether it falls within the specified exceptions in s 13(2)(a) is considered later under 'non-profit research'. The nature of the work comprises the plaintiffs' broadcasts of the television news programmes produced by them. If the exhs P2A-P2D are considered it is evident that a relatively short portion of the plaintiffs' entire news programme only is utilised. However the word 'substantial' does not only connote quantity. It also connotes the essence of the broadcast, the message and information communicated thereby. As stated in Hubbard and another v Vosper and another consideration ought to be given to the number and extent of the reproduction. In the instant case it is not in dispute that the entirety of the plaintiffs' television news programmes broadcast, are recorded by the defendants and stored. The relevant part sought by a particular client is then edited, compiled and provided in virtually original form to the client. On these facts it appears to the court that a substantive portion, if not the entirety of the plaintiffs' works are utilised. The impression that arises from a consideration of the annexure of these specially edited and compiled segments of the plaintiffs' broadcasts, is that the defendants have reproduced in substantial part the plaintiffs' broadcasts of their television news programmes. The fact that there is an express acknowledgement of the plaintiffs' entitlement to copyright does not materially affect this impression. The effect of such dealing on the potential market for, or value of the work, ie the broadcasts is that the plaintiffs ability to market, distribute and sell copies of its own broadcasts at costs designed to take into account the cost of production of such broadcasts is disrupted and adversely affected. This is because, as borne out by the evidence, the public purchases copies of the plaintiffs' broadcasts from the defendants rather than the plaintiffs themselves. They therefore suffer loss. Significantly, the public is mistaken into thinking that the defendants and the plaintiffs are related or conduct a related business. The motive of the defendants in recording continuously the broadcasts of the plaintiffs' television news programmes is to compile an archive of information so as to provide data and analysis to its clients for a fee. The fact that the defendants sought to procure from the plaintiffs' a licence to carry out their recording discloses that the defendants knew and understood that they were infringing the plaintiffs' copyright. The defendants enjoy licences with other broadcasters, thereby corroborating the fact that the defendants fully comprehend the extent of their actions. In other words, the defendants, in order to conduct their media monitoring business were prepared to continue to infringe 6 MLJ 657 at 723 the plaintiffs' copyright in the broadcast of their television news programmes.

(b) (c)

(d)

(e)

(f)

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'Non-profit research' [217] What is meant by 'non-profit research'? Professor Khaw Lake Tee in her book, Copyright Law in Malaysia states as follows:
... The term 'non-profit' is problematic. In the first edition, it was suggested that 'non-profit research' referred to research conducted for non-commercial purposes and therefore research conducted by corporations, companies and other business associations was excluded from this defense. Implicit in those statements was the suggestion that non-profit research was confined to research conducted by bodies other (than) these commercial entities, such as university researchers and academics. However, it is now acknowledged that the above interpretations may not be entirely correct as there may be cases where university researchers are conducting research not purely for the sake of academic research and publication but with a view to potential commercialization or for projects commissioned by commercial enterprises. Similarly, there could be situations where research by corporations, companies and other business associations may not necessarily be conducted with a view to profit, though such cases may be rare indeed. The qualification 'non-profit' must thus be read in relation to the research itself and not to the persons or entities conducting it, an interpretation which is not inconsistent with the wording of s 13(2)(a) itself.

[218] In this context, the defendants submit that they have made it clear to their clients and the public that their charges are only in respect of the defendants' compilation, editing and delivery services. They maintain that they do not actually charge for the excerpt. Applying the foregoing the defendants contend that it cannot be said certainty that they are not involved in 'non-profit' research which has to be judged at the time the research was made and not at the time the clips are delivered to the customers. Further they maintain that the first defendant, by recording and reviewing is doing what every company concerned with its image is doing in-house vide their own employees or through other larger public relations companies or media monitors, such as themselves. Research when done for these companies own use it is contended, is non-profit. In the instant case, instead of an individual company carrying out the media monitoring itself, it hires an agent to do so and this in itself warrants, according to the defendants, the application of the statutory exception of fair dealing for non-profit research to themselves. [219] The plaintiffs contend otherwise. They point to the fact that the entire enterprise set up by the defendants is for profit and maintain that the defendants cannot surgically incise the clippings or segments of the news programmes compiled and maintain that those portions are to be viewed in 6 MLJ 657 at 724 isolation as amounting to fair dealing for non-profit research, to the exclusion of the rest of the defendants' operations. [220] Having considered the two competing contentions, it appears to this court that in order to construe 'non-profit research' in the current factual matrix, it is necessary to take into account the totality of the defendants' operations and not focus on discrete sections separately. In other words, it appears to this court to be rather artificial to segregate that part of the defendants' operations which records and reproduces in its entirety the television news broadcasts made by the plaintiffs, enabling segments to be compiled and edited subsequently for purposes of appending such clips to the reports and analysis conducted by the defendants. The court would have to accept that that portion of the operations alone is free but that the compiling, editing and compressing processes were being charged for. However upon a consideration of the totality of the evidence of the defendants' and plaintiffs' witnesses, it appears that the segments which are produced directly from the plaintiffs' original broadcasts comprise an integral and inextricable part of the defendants' operations. [221] The fact that several parties approached the plaintiffs to ascertain whether the defendants who had approached them with a view to offering for sale segments from news programmes produced by the plaintiffs for a fee, ousts the possibility of any such segments being provided without a fee. [222] The trap purchases evidence the fact that the defendants in fact store the recordings of the plaintiffs' television news programmes for a considerable length of time, as segments of broadcasts produced more than a year ago were still available for potential sale to the plaintiffs.

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[223] If, as I have concluded, the sale of news 'clips' and segments of broadcasts produced by the plaintiffs comprises an integral part of the defendants' media monitoring services, which comprises the core business conducted by the defendants for a sizeable profit, how can it be said that on the facts of the instant case, the annexing of clippings of news segment broadcasts produced by the plaintiffs, but reproduced and sold by the defendants amounts to non-profit research? [224] The defendants have given evidence to show that they carry out research and analysis for their clients, the public, for profit. They have explained in detail how their business is carried out. It is evident from the evidence of DW1, DW2 and DW4 who portray the typical client profile of the defendants' clients that they place considerable significance on the news clippings or segments of television news programmes sent to them by the defendants. It comprises, according to their evidence, an integral part of the 6 MLJ 657 at 725 defendants' media monitoring services. They testified that the removal of the defendants' clips of the plaintiffs' broadcasts would adversely affect their research and analysis reports, as they maintained that it was important for them to be able to visualise the impact of the contents of those clips relating to their individual companies or their research. [225] As such it follows that the clips of the plaintiffs' broadcasts which the defendants copy entirely or substantially and which they subsequently compile, edit, store and distribute does not comprise 'non-profit research'. A profit is derived by the defendants from its operations as a media monitoring business, of which the annexure of copies of segments of, inter alia, the plaintiffs' broadcasts comprises an integral part. Therefore the research carried out by the defendants appears to be for profit and does not appear to fall within the purview of this purpose. [226] In Television New Zealand v Newsmonitor Services Ltd (1993) 27 IPR 441 ('the TVNZ case'), a decision of the High Court of New Zealand, a similar situation arose. A news monitoring entity known as Newsmonitor Services Ltd carried on a business whereby it taped broadcasts of television and radio news and current affairs programs. It then advised its customers when items of interest they had specified were transmitted. If a customer indicated that they required a transcript, then the news monitoring agency would transcribe the relevant parts of the programme as specified, whereupon a copy would be supplied for a fee. The plaintiff in that case, Television New Zealand or TVNZ, broadcast television programmes throughout New Zealand. It claimed that Newsmonitor committed breaches of copyright when it records by way of video TVNZ's news and current affairs programs and when it supplies transcripts of portions of them to its customers. [227] The foregoing facts are similar to the present factual matrix, save that in the instant case, the defendants provide actual compressed copies of the required or specified excerpts in virtually the identical form. In the TVNZ case, transcripts made from video recordings of the programs are instead sold to the clients together with the news monitoring analysis. [228] As is the case here, Newsmonitor emphasised in the course of its evidence that the monitoring of broadcast news and current affairs is difficult in view of the ephemeral nature of broadcast material. They too explained that unless a video or audio taping was made of the exact words used so as to comprehend the nuances of the language, the content would not be captured accurately. In like manner they led evidence that it was inexpedient, not to mention extremely expensive for any one entity to monitor the airwaves 24 hours a day continuously. As such the rationale for a commercial enterprise such as itself, to carry out this function was evident. In like manner the 6 MLJ 657 at 726 defendants here too, explained the rationale and the need for a commercial enterprise that conducted media monitoring services. [229] It was also stressed that a news monitoring service is symbiotic to, and not in competition with broadcasters. In the instant case too, the defendants have emphasised this fact and utilise this as a further basis for maintaining that no breach of copyright is committed by them. They maintain that the fact that they are not rivals of the plaintiffs contributes significantly to the defence of 'fair dealing'.

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[230] By way of defence in relation to committing a breach of broadcast copyright, Newsmonitor maintained that their recordings of the broadcasts were made 'for private purposes'. The legislation then in New Zealand provided that the acts restricted by copyright in a broadcast include, in so far as it comprises visual images, the making 'otherwise than for private purposes'. The court in the TVNZ case therefore had to consider the term 'private purpose' as opposed to 'non-profit research' in the instant case. Notwithstanding that the terms used are distinct and different, the rationale adopted by Blanchard J in the TVNZ case is instructive. After discussing the meaning to be attributed to the words 'private purpose' the learned judge went on to state:
... When Newsmonitor makes video tapes it is not doing so for its own private and internal purposes. It has no private interest in the tapes. They serve only as a means of carrying out its news monitoring activities in fulfillment of its contracts with its customers. Newsmonitor's purpose in making the tapes is entirely commercial. Section 15(4) makes what I deduce to be intended to be a very limited inroad on the broadcast copyright created by the section. I do not think that it can have been intended that the reference to 'private purposes' was to allow a taping of the broadcasts in order to exploit all or part of their content commercially. It is immaterial that end users, namely customers may themselves not have intended to sue the transcripts for anything other than internal reference. In other words, I equate 'private' not only with non-public, but also with an absence of commercial exploitation involving, directly or indirectly, a disposition of the work ....

[231] In the Act s 13(2)(a) allows for an exemption of copyright broadcast control in respect of 'fair dealing for the purposes of non-profit research'. How then is 'non-profit research' to be construed? It appears to this court that those words must be given their normal and ordinary dictionary meaning as has been done in other jurisdictions (see De Garis & Anor v Neville Jeffress Pidler Pty Ltd (1990) 95 ALR 625). The words denote quite simply that the research undertaken should not be for profit. This in turn means that in order to fall within the exception, the 'research' undertaken by the defendant (if it can be called that), must be for a non-profit purpose. In other words, the section appears to allow an exception for a non-profit enterprise. 6 MLJ 657 at 727 [232] In ascertaining whether the acts of the defendants in recording, storing, compiling, archiving, editing and distributing for sale to their clients or the public, copies of the plaintiffs' broadcasts falls within the purview of this exception, it seems to my mind that the entirety of the defendants' operations are to be considered as a whole. This has been discussed above. When considered as a whole, the inexorable conclusion that presents itself on the facts are that the defendants are engaged in a commercial or profit based enterprise, which therefore cannot fall within the definition of 'non-profit research'. [233] In the TVNZ case, reference was made to a decision of the United States Court of Appeals for the Eleventh Circuit, notwithstanding that the statutory framework was somewhat different. Again it was the reasoning and the thrust of the decision that was instructive. In the Pacific and Southern Company Inc Wxia-Tv v Duncan Tv 744 F 2d 1490 the defendant had taped and sold the plaintiff's television broadcasts. In concluding that it did not amount to 'fair use' the court gave as its reason the fact that the defendant was doing so 'for unabashedly commercial reasons despite the fact that its' customers buy the tapes for personal use'. The court added that a commercial purpose makes copying on to a videotape cassette 'presumptively unfair'. [234] Again notwithstanding the differing statutory frameworks the thread of commonality to be found in all the jurisdictions is that any inroads into the rights of control bestowed on copyright owners does not extend to include commercial enterprise or a profit making business where the person/entity reproducing the owner's copyrighted material does so for his/its commercial profit. [235] Blanchard J in the TVNZ case put it this way:
... I too think that fair dealing for the purposes of research or private study does not encompass an activity in which the material concerned is simply appropriated and passed on to others for commercial profit of the appropriator. It seems to me that the section draws a line between the paid conduct of research by an employee of a commercial organisation in the course of employment, and a paid appropriation of material which is then sold to someone else for the purposes of research or private study ...

[236] By way of contrast to the decision in the TVNZ case, the defendants point to a decision of the Supreme

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Court of Canada in CCH Canadian Ltd v Law Society of Upper Canada [2004] SCC 13 where the issue of 'fair dealing' was considered in detail and a comprehensive test formulated to assess the same. The facts are as follows. 6 MLJ 657 at 728 [237] The Law Society of Canada, the appellant, maintains and operates a reference and research library with one of the largest collections of legal materials in Canada. It is known as the Great Library. It provides request based photocopy service for law service members, the judiciary and other authorised researchers. Under this 'custom photocopy service' legal materials are reproduced by Great Library staff and delivered in person, by mail or by facsimile transmission to requestors. The law society also maintains self service photocopiers in the Great Library for use by its patrons. The publishers who are the respondents, commenced copyright infringement actions against the law society, seeking a declaration of subsistence and ownership of copyright in specific works and a declaration that the law society had infringed copyright when the Great Library reproduced a copy of each of the works. The publishers also sought a permanent injunction prohibiting the law society from reproducing these works as well as any other works that they published. The law society denied the claim and counterclaimed for a declaration that copyright is not infringed when a single copy of a reported decision, case summary or a limited selection of text is made for the purposes of research, by either the Great Library staff, or one of the patrons on a self-service copier. The trial court allowed the publishers' action in part, finding that the law society had infringed copyright in certain works. The counterclaim was dismissed. The Supreme Court of Canada held that the law society's appeal should be allowed. The publisher's cross-appeal was dismissed. The court found that the law society does not infringe copyright when a single copy of a reported decision, case summary or limited text selection is made by the Great Library in accordance with its access policy. Neither did it sanction copyright infringement by maintaining a photocopier in the library. Such use it was maintained, amounted to fair dealing under the provisions of their copyright act which stated that fair dealing for the purpose of research or private study does not infringe copyright. [238] In construing the term 'research' the Canadian Supreme Court reasoned that the word had to be given a large and liberal interpretation in order to ensure that users' rights are not unduly constrained, and is not limited to non-commercial or private contexts. Lawyers carrying on the business of law for profit are conducting research within the meaning of s 29. The court determined that in ascertaining whether or not a dealing amounts to fair dealing within their statute, the following facts would be relevant, namely the purpose of the dealing, the character of the dealing, the amount of the dealing, the nature of the work, available alternatives to the dealing and the effect of the dealing on the work. [239] The court went on to find that the law society's dealings with the publishers' works through its custom photocopy service were research based and fair. The access policy placed appropriate limits on the type of copying that 6 MLJ 657 at 729 the law society did. A copy was only made for the specific purposes of research, criticism, review or private study. If not for one of these purposes, the copy would not be made. [240] The defendants contend that as in the case above, they are not infringing the plaintiffs' broadcast copyright because they, like the law society, provide a copy to their clients to enable their clients to conduct internal research. The defendants point to the fact that in the CCH case, the Supreme Court of Canada held that the word 'research' ought to be construed widely and liberally so as not to limit it to non-commercial entities or private contexts. [241] Under the Act however, as discussed in some detail earlier on in this judgment, fair dealing in Malaysia is qualified by the purpose for which such dealing is conducted. And in relation to research, that term is further qualified by the words 'non-profit'. There is no such qualification in the Canadian statute which provides simply that: 'Fair dealing for the purpose of research or private study does not infringe copyright.' In other words the Canadian statute refers to 'research' while the Act provides for 'non-profit research'. As such in construing research, the same broad and liberal approach cannot be adopted. In this jurisdiction research which is exempt from copyright infringement has to be non-profit research. As discussed earlier those words connote a non-commercial or profit based research. Further and looking at the matter more substantively, it

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is evident that the law society in providing single copies of cases for users of the Great Library were facilitating research. The fact that the law society was providing copies which were used by lawyers in the practice of their profession which was for profit did not preclude the Supreme Court of Canada from adjudicating that such use fell within the purview of 'fair dealing'. In other words the person or entity who facilitates another person's fair dealing may be entitled to the same protection under the Canadian statute as that person. However the fact that fair dealing for purposes of research can extend to someone who is assisting another person in the conduct of research in Canada again stems from the fact that research may be given a wide and liberal interpretation in the light of the absence of the words 'non-profit' in that jurisdiction. Here the restriction is express and cannot be ignored. However it should be noted that under the Act, s 13(2)(l) makes express exclusion for use of a work for the purposes of any judicial proceedings, royal commission, legislative body, statutory or governmental inquiry or for the purposes of the giving of professional advice by a legal practitioner. Therefore the same degree of protection is afforded under the Act. However the scope of the Malaysian Copyright Act is such that the exempt circumstances are strictly prescribed. The interpretation to be accorded to those exceptions is therefore as strictly set out under the Act. Even if a wide or liberal interpretation is accorded it must fall squarely within the purview of those exceptions. In the instant case, the defendants' operations fail to fall within any of the provisions of the exceptions 6 MLJ 657 at 730 prescribed. CONCLUSION [242] ln summary, as I have concluded earlier, the plaintiffs have established in the course of this trial that they enjoy broadcast copyright in the plaintiffs' television programmes broadcast from the Republic of Singapore. They also enjoy film copyright in the pre-recorded film segments of the plaintiffs' television news programmes. [243] There subsists in the television news programmes broadcast from Singapore broadcast copyright and film copyright in the pre-recorded segments of the television programmes. [244] The defendants' acts of recording the plaintiffs' television news programmes off air has infringed the plaintiffs' copyright in broadcast and film vis-a-vis the pre-recorded segments. [245] The defendants' acts of recording, compiling, archiving, compressing, editing, reproducing and distributing, albeit for sale or not amount to a reproduction and/or substantial reproduction of the plaintiffs' television news programmes. [246] The plaintiffs have proved such infringement by the production of infringing copies, exh P2A-P2D which were available for comparison with true copies of the complete news programmes contained in four discs in exh P10. [247] The plaintiffs failed to produce to the court infringing copies of the plaintiffs' radio programmes, although they contend that such copies are contained in exhs P2A-P2D. Neither did the plaintiffs produce true copies of such radio programmes through PW6 or in exh P10. As such the court had no materials on which it could ascertain the subsistence of copyright any or all rights flowing there from. In this context the plaintiffs contend that the defendants agree that they record all the plaintiffs' radio programmes off air. This does not however relate directly to the proof of subsistence of copyright which is a pre-requisite to establishing infringement and entitlement to relief. Such subsistence cannot be assumed or presumed by the court. The parties must either agree on the mode of proof of establishing such subsistence or provide sufficient evidence to establish such subsistence. In the instant case, neither limb was fulfilled. Therefore the court could not conclude that the plaintiffs had established the subsistence of broadcast and sound copyright in the radio programmes. To that extent the relief afforded to the plaintiffs is in respect of their television news programmes. However as discussed in the body 6 MLJ 657 at 731 of the judgment the relief granted extends to all television news programmes broadcast by the plaintiffs from Singapore.

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[248] Having established the subsistence and infringement of broadcast copyright and film copyright in the pre-recorded segments of the plaintiffs' television news programmes the court considered the defence of fair dealing for the purposes of non-profit research and concluded that the defendants' operations as a media monitoring agency did not fall within the purview of that statutory exception. Neither did it fall within any of the other exceptions set out in s 13(2) of the Act. [249] The plaintiffs are accordingly entitled to: (a) an injunction to restrain the defendants and each of them, whether by themselves, their employees or agents or any of them and/or through or in collaboration with any individual or corporation or otherwise howsoever, from reproducing and/or substantially reproducing and/or copying the television news programmes aired by and belonging to the plaintiffs in the form of VHS, Betacam, CD format, VCD, DVD and/or other digital format and/or by any other name into material form, for the purposes of selling, offering for sale and/or distributing the same in the course of business; an injunction to restrain the defendants and each of them whether by themselves their employees or agents or any of them and/or through or in collaboration with any individual and/or corporation or otherwise however, from copying, recording, reproducing, offering for sale, distributing, marketing, advertising, selling and/or otherwise dealing in or with the television news programmes and /or the copyrights and the infringing goods in VHS, Betacam, CD format, VCD, DVD and/or other digital format; an order for the removal from the defendants' library listing, both online and within the offices of the defendants, the television news programmes; an order to deliver up all copies both in the soft and/or digital and/or video and/or Betacam and/or CD format, VCD and/or DVD format and/or any other format of all the copyrighted material which are infringing the television news programmes which are in the defendants' possession or in the possession of agents and servants of the defendants at the defendants' own expense, to the plaintiffs solicitors for destruction in any manner deemed fit by the plaintiffs; and an award of damages arising out of breach of the plaintiffs' copyright, if any, in the aforementioned material to be assessed by this honourable court. 6 MLJ 657 at 732

(b)

(c) (d)

(e)

[250] This court makes no order in relation to the causes of action relating to passing off and infringement of trademarks as these causes of action are not pursued by the plaintiff. [251] The costs of this action are to be borne by the defendants. Plaintiffs' claim allowed with costs.

Reported by Kanesh Sundrum

Malayan Law Journal Unreported/2009/Volume /N-Visio Sdn Bhd v Horizon Multimedia Sdn Bhd & Ors [2009] MLJU 1249 - 28 August 2009 [2009] MLJU 1249

N-Visio Sdn Bhd v Horizon Multimedia Sdn Bhd & Ors

HIGH COURT (KUALA LUMPUR) Datin Zabariah Mohd Yusof, JC CIVIL SUIT NO S7-22-309-2008 28 August 2009

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Gideon Tan Anor Tan Yew Aik (T/n Gideon Tan Razali Zaini) W. W. Wong (T/n Kadir Andri & Partners) Colin Pereira (T/n Goh Wong Pereira) Datin Zabariah Mohd Yusof, JC GROUNDS OF JUDGMENT This is the application in Enclosure 2 i.e. the Plaintiff's application (inter partes) for an Anton Piller Order against the 1st Defendant. Enclosure 2 was heard together with Enclosure 14 i.e. the 6th Defendant's application to set aside the ex parte Anton Piller Order. Brief Facts The Plaintiff is an IT multimedia company which provides an electronic gateway between telecommunication companies providing mobile content (Television stations) and mobile networks to Digi, Celcom and Maxis (telcos). Mobile users who uses the content/platforms aired by the television telcos will connect to the contents/platforms by dialing short codes provided by telcos. The Plaintiff had a contract with the telcos for the sole use of the short codes of 33838, 33999 and 32277 and had been servicing the one time set up fees and the monthly maintenance charges for such usage. The 2nd, 3rd and the 5th Defendant used to hold high ranking posts in the Plaintiff's company and were responsible in the management and business of the Plaintiff in Malaysia. The 4th and the 6th Defendants are the directors cum shareholders of the 1st Defendant of Info Business Research & Consulting Sdn. Bhd. which had been involved in providing financial consultancy services to the Plaintiff. In the course of providing consultancy services to the Plaintiff, detailed information relating to business and marketing and investment plans of the Plaintiff, not limited to financial accounts was furnished to them. It was subsequently discovered by the Plaintiff that there had been rapid decrease in the Plaintiff's revenue in the month of November and December 2007 and the 2nd Defendant who was then the Director and Chief Executive Officer of the Plaintiff at the material time could not gave a reasonable explanation. Investigation revealed that there were transfers of short codes to the 1st Defendant by Celcom Mobile Sdn Bhd followed by Digi Tel. and then Maxis. The Plaintiff did not receive any income thereafter which they were entitled to, which was derived from the use of the short codes since November 2007. The 2nd, 3rd and the 5th Defendant left the employment of the Plaintiff one after the other on or before the investigation on the decline of revenue of the Plaintiff. They subsequently joined the 1st Defendant. Other key employees of the Plaintiff was also found to have followed suit and left the employment of the Plaintiff to join the 1st Defendant. The Plaintiff's cause of action against the 2nd, 3rd and 4th Defendants is that as employees of the Plaintiff, they have conspired to interfere with the Plaintiff's business and committed the tort of conversion, in particular the transfer of the short codes without the knowledge of the Plaintiff's Board of Directors and until no income were generated since the month of November 2007. The Plaintiff alleged that it was suspicious that the 2nd Defendant was unable to provide an explanation for the decrease in revenue of the Plaintiff at the material time, during the meeting where queries were posed to the 2nd Defendant, who was then the Director and Chief Executive Officer for the Plaintiff. As far as the action by the Plaintiff against the 4th and 6th Defendants is concerned, the cause of action by the Plaintiff against these 2 individuals is the unlawful use of the Plaintiff's confidential information. Company search shows that the 4th and the 6th Defendants, who were previously providing financial services to the Plaintiff vide Info Business Research & Consulting Sdn. Bhd. are the directors for the 1st Defendant. The

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Plaintiff alleged that the culpability of the 4th and the 6th Defendants in the theft of the business is plain and obvious. The 6th Defendant is both the shareholder and director of Info Business Research & Consulting Sdn. Bhd which used to have access and had the possession of the Plaintiff's confidential information. At the same time she is a founder of the 1st Defendant who then conveniently siphoned the business of the Plaintiff and conspired with others in setting up the 1st Defendant which runs the same nature of business as the Plaintiff. Subsequently the Plaintiff filed Enclosure 2 for an ex parte Anton Piller order, inter alia, for the 1st Defendant to allow the Plaintiff and/ or its agent to enter the 1st Defendant's premises in Damansara Utama and Bandar Utama to inspect the 1st Defendant's copies of documents relating to its business; the 1st Defendant to inform the Plaintiff the locations of all relevant documents after the inspection for the purpose of this suit. The Plaintiff's grounds for the application of the Anton Piller Order was that the Plaintiff was able to show a strong prima facie case against the Defendants and the Plaintiff had sufficient evidence to prove at the trial the liabilities of the Defendants. However the Plaintiff did not have the "the best possible evidence" to prove damages and these documents were documents which happened to be in the possession of the 1st Defendant. The Plaintiff contended that the documents would show the amount and the value of the short codes i.e. how much business had been derived from the use of the Plaintiff's short codes. It was further argued that without such documents the Plaintiff would be unable to plead the damages and in effect this case would have to be concluded by way of lengthy 2 stages process which are first to prove liability and thereafter to go through lengthy assessment of damages hearing. It was also contended by the Plaintiff that the conduct of the 4th, 5th and the 6th Defendants were to blatantly disregard the interest of the Plaintiff and therefore, dishonestly and lacking in probity by diverting the business of the Plaintiff to the 1st Defendant, eventually a company which was in control by themselves, depriving the Plaintiff of its entire business, and soliciting the key employees from the Plaintiff to the 1st Defendant. This alleged perpetration by the Defendants is an outright theft of the Plaintiff's business and based on the facts there is no denying that whilst during their employment with the Plaintiff, the Defendants have dishonestly planned to injure the business by first transferring the short codes of the Plaintiff knowing that the mainstream of the source of income of the Plaintiff is the short codes. Subsequently, the Court on 3.4.2008 granted an ex parte order of the Anton Piller against the 1st Defendants for Enclosure 2 with the usual undertaking as to damages. Following that, the case came before me for the the inter parte hearing of the said Enclosure 2. This Enclosure 2 was heard together with Enclosure 14. Enclosure 14 is the application by the 6th Defendant to set aside the ex parte Anton Piller Order dated 3.4.2008 on grounds that the said Order was not regularly served on the 6th Defendant and the Plaintiff is not in a financial position to fulfill its undertaking as to damages. The 6th Defendant is not in possession of the evidence required to be handed over by the Order, thus, is in no position to comply with the Order. ENCLOSURE 2: At the start of the hearing of inter partes of Enclosure 2, Mr Gideon Tan, counsel for the Plaintiff had indicated to the court that he was of the view that as far as an Anton Piller order is concerned, once it is granted by the court, (ex parte though it may be),there is no necessity for an inter partes hearing to proceed, especially in situation where the ex parte order had been executed and spent. Both parties submitted before me on this point. After due consideration of their submissions and the provisions in our Rules of the High Court 1980 and the authorities cited by both parties I agree with the view as advanced by Mr. Gideon Tan, counsel for the Plaintiff that there is no necessity for an inter partes hearing of the Anton Piller order which had been given ex parte on 3.4.2008. Below are my reasons: The provisions of 0 29 r 1 (2B) of the Rules of the High Court 1980 relates to interim injunctions and it states that an ex parte interim injunction once obtained lasts for 21 days.

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However, case law authorities have shown that the provision of 21 days is not applicable to Anton Piller Orders. This was succinctly ruled in the case of GMX Associates Pte Ltd & Anor v Lee Yew Pooi (Berniaga di bawah nama dan gaya Universal Trading Co) [1999] 1 AMR 126 by Steve Shim Lip Kiong, J at page 128 where he states thus:
".....In my view, the provisions of 0 29 r 1 (2B) of the Rules of the High Court are clear enough. They relate specifically to interim injunctions. Nothing can be construed therein to include Anton Piller orders..."(emphasis mine"

Further at page 129:

" Though the authorities have established that in appropriate cases, the court has the power to discharge Anton Piller orders even after they have been executed, it is however unclear as to when the application for such discharge ought to be done. In the case of interim injunctions...........in my view, this two week limitation does not apply to an Anton Piller order, although off course effluxion of time may weigh against discharge of such order. This is quite evident in the case of Columbia Pictures Industry Inc v Robinson [1987] Ch 38 where there was an application to discharge an Anton Pillar order which had apparently been executed some years previously. In that case, the court refused the application on the ground of material non-disclosure by the plaintiff. In my view, any such application for discharge or to set aside an Anton Piller order must necessarily be made within a reasonable time after the grant of the order. What is a reasonable time is a question of fact to be decided by the court upon the particular facts and circumstances of the case. "

The point which can be derived from the above passage of the judgment is that 0 29 r 1 (2B) Rules of the High Court 1980 is not applicable to an Anton Piller Order. Therefore since the provision of 21 days period is not applicable to Anton Piller orders, then there is no necessity to give a return date for an inter partes hearing. However, an ex parte Anton Piller order may be subjected to a discharge if the situation warrants it and any application of a discharge of any Anton Piller order has to be made within a reasonable period of time. This particular point is further amplified by the court in the same case where Steve Shim J. further ruled that the preliminary objection by the counsel for the Plaintiff who contended that at the time of the application to set aside the ex parte order, the order had lapsed, that it had automatically expired/lapsed and as such there was no longer any interim injunction to be set aside and consequently the other reliefs sought must suffer, is only sustainable as against the other orders ( which was a non Anton Piller order), except that it cannot stand against the Anton Piller order therein. Essentially, Anton Piller order is a court order which provides for the right to search premises without prior warning. This is used in order to prevent the destruction of incriminating evidence. The first of such order was issued in the case of Anton Piller KG v Manufacturing Processes Ltd & Ors [1976] 1 AER 779). The order authorizes the Plaintiff to enter upon the premises of the Defendant to search for documents or articles which is needed for the Plaintiff's case, to take/make copies or remove them from the premises to be kept in safe custody by the Plaintiff's solicitors. Effectively, it is to ensure that the evidential document or articles which are crucial to the Plaintiff's case would not be destroyed or concealed pending disposal of the Plaintiff's case. The primary purpose of the Anton Piller Order is to preserve evidence which is essential and relevant to the Plaintiff's case. (Refer to the case of ESPL (M) Sdn Bhd v Harbert International Est Sdn Bhd [2003] 2 AMR 724; Columbia Picture Industries Inc v Robinson [1986] 3 AER 338 at pp 367and 371; and Television Broadcasts Ltd & Ors v Mandarin Video Holdings Sdn Bhd [1983] 2 MLJ 346). An Anton Piller order is a very harsh and draconian order obtained against the Defendant. It is a heavy burden and the threshold for the applicant to satisfy the court in applying for an Anton Piller order is very high. Because such an order is essentially unfair to the accused party, Anton Piller orders are only issued exceptionally, when. . . There is an extremely strong prima facie case against the Defendant, The damage, potential or actual, must be very serious for the applicant, and There must be clear evidence that the Defendants have in their possession incriminating documents or things and that there is a real possibility that they may destroy such material before the disposal of the main trial.

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Due to the very nature of the order which is to prevent the destruction or lost of material and relevant evidence, hence more often than not the court will be moved discreetly and speedily for an ex parte order without the knowledge of the Defendant. It would come as a surprise to the Defendant. Mark S.W Hoyle in his book "The Mareva Injunction and related Orders" 3rd Edition at page 107 clearly explains the nature of Anton Piller as follows:
" Anton Piller orders are potentially as far-reaching as mareva injunction and involve many potential difficulties, not only because of consequenent interference with the rights of individuals and companies, but also because of the effect on third parties. Anton Piller orders can be described as a formidable ally in preserving evidence and preventing empty judgment. The anton piller order, designed to prevent the destruction of evidence and/or the subject matter of a dispute, is a mandatory order placing a heavy burden on a defendant. It usually comes as a surprise to the recipient of the order, and is only effective if it is planned and executed efficiently and discreetly. By its nature it can do great harm to a defendant, and the courts have always been careful to emphasize the extraordinary nature of the order."

At the ex parte stage the order may/may not be executed fully depending on the circumstances of the case. In other words, the Plaintiff would have executed the search of the defendant's premises and obtained the relevant documents pursuant to the ex parte order. In situation where the ex parte order had been fully executed, the purpose of the order had been served, there is no necessity for the hearing of the inter partes. Furthermore the period of 21 days as stipulated under 0 29 r 1(2B) of the Rules of High Court 1980 is not applicable, thus rendering the absence of the necessity for an inter partes hearing. There are no Malaysian cases on this point. Cases like ESPL (M) Sdn Bhd v Harbert International Est Sdn Bhd and GMX Associates Pte Ltd & Anor v Lee Yew Pooi, did not address specifically on this point and neither did it state that parties are to proceed/or not to proceed for inter partes hearing of the Anton Piller order after the ex parte order had been granted. However, English cases over the years seems to recognize that after an ex parte Anton Piller Order had been granted there is no necessity for the Plaintiff to bring it forward, however the court would always entertain an application for the discharge of an Anton Piller order because of the undertaking as to damages, i.e if the order had been obtained wrongfully and there is the necessity to assess for damages incurred by the Defendant. But nowhere does the cases states that parties are to proceed for an inter partes hearing subsequently after an ex parte order had been granted. Bearing in mind the nature of an Anton Piller order, it does not serve any purpose for an Anton Piller Order which had been served, executed and spent, to proceed for an inter partes hearing. Subsequent hearing would only follow if the defendant wishes to set aside the ex parte order on grounds that it had been improperly granted or that the Defendant had caused grave prejudice or that it had caused an injustice to the defendant. Support for this proposition can be found in the case of Booker Mc Connell Plc & Anor v Plascow & Ors [1985] RPC 425 whereby the court succinctly ruled thus:
"The retrospective discharge of fully executed Anton Piller Orders: Since this was raised as an issue or principle, it is convenient to deal with it before turning to the parties' other contentions. There are two decisions of this court which clearly show, I think, that even a fully executed order can be discharged if it is established that it should never have been made. Indeed, this must be so whenever a defendant raises this contention and seeks to enforce the plaintiffs cross-undertaking in damages on the basis of which the order against him was made. In WEA Records Ltd v Visions Channel 4 Ltd [1983] 1 WLR 721; [1984] FSR 404, this court considered an appeal by defendants against whom an Anton Piller order had been made and successfully executed. They then sought to have the order set aside in the Chancery Division. However, their application came before this court on a purported appeal, before any order on this application had been made at first instance, because both parties agreed that there would be an appeal in any event. Not surprisingly, this procedure was emphatically rejected in this court. For present purposes, however, it is interesting to note that at pages 727 to 728 Sir John Donaldson MR said: "If it were now clear that the defendants had suffered any injustice by the making of the order, taking account of all

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relevant evidence including the affidavits of the personal defendants and the fruits of the search, the defendants would have their remedy in the counter-undertakings as to damages. But this is a matter to be investigated by the High Court judge who is seised of the matter, and only when he has reached a decision can this court be concerned." That case was considered in another decision of this court to which we were referred, Randolph M Fields v Alison Watts, The Times 22 November 1984. It concerned an Anton Piller order against certain members of the Bar. They applied to have it discharged after it had been largely executed, though parts of the order remained to be complied with, particular the swearing of an affidavit. The Judge at first instance decline to set the order aside, but an appeal to this court was allowed. After pointing out that the order had not yet been fully executed, O'Connor LJ said at page 23 of the transcript: But leave that aside. If an order has been obtained on a wrong basis, I am satisfied that the proper order for this court to make, when the matter comes before it - and which should have been made,........is to discharge the order ab initio, although the search and seize part of the order has been completed. I find nothing in WEA Records Ltd v Visions Channel 4 Ltdwhich debars a court from discharging an order which has been improperly obtained, and I would discharge this order", ........................... However, there remains the question at what stage of the action this should be done. If the sole reason for seeking a retrospective discharge of the order is to enforce the cross-undertaking as to damages, then I can see no ground for any immediate application. Any issues as to the validity of the order or as to the consequences of its invalidity should generally be left to be dealt with at the trial of the action. If the action is settled, then any disputes concerning the order are likely to be settled as well. But exceptional cases can arise if a defendant is in some way affected in his reputation or otherwise by the fact that the order remains apparently valid in the interim. Fields v Watts was such a case, and I have already indicated that the article in The Grocer and the pending inquiry by the Monopolies and Mergers Commission in my view are justified an immediate application in the present case. ....(emphasis mine)"

What is interesting as stated in the case cited above is that the court ruled that if the only reason for the application of the discharge of the order is on the issue of damages, then there is no necessity to have the application heard immediately. That can be done at the end of the case when the Judge can have a full appraisal of the evidence before him. This further supports the proposition that there is no further need for an inter partes hearing of an ex parte Anton Piller Order. There is no similar provision in the English Laws as our 0 29 r 1 (2A) or (2B) of the Rules of the High Court 1980 at the time when Booker Mc Connell Plc was decided. The practice in the U.K. is that once an ex parte order is granted, a return date is provided where both parties attend court to argue before the court. The alternative position is that the parties applies to set aside the ex parte order. In Malaysia however we have codified this practice of giving an inter parte hearing after an ex parte order of an interim injunction is granted. As had been ruled by Steve Shim Lip Keong J in the case of GMX Associates Pte Ltd & Anor v Lee Yew Pooi (Berniaga di bawah nama dan gaya Universal Trading Co, the 21 days rule is irrelevant in an Anton Piller order. However it would be prudent for the court to give a return date after an ex parte Anton Piller Order is granted. Since in our present case the Plaintiff's counsel submits that the ex parte Anton Piller Order had been fully executed and spent, then following from the English cases abovementioned, I do not find the necessity to proceed with the inter partes hearing. Further, as the provision of 0 29 r (2B) Rules of the High Court 1980 as to the 21 days is inapplicable in our case, there is nothing more to extend as in the case of an interim injunction. However, it is open to the Defendant to apply to set aside the ex parte order if they think that the same was wrongly granted by the court. Counsel for the 6th Defendant submits that with reference to the ex parte order at paragraph 12, it specifically states that the said Enclosure 2 is to proceed with inter partes hearing. Since the application is already before this court, then the court is minded to determine the application as to whether to grant the Anton Piller order on an inter parte basis or to dismiss it. Counsel further submits that since counsel for the Plaintiff is not proceeding with the inter partes hearing, then counsel sought for the court to strike out the application and to leave the issue of costs to be

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determined which is to be borne by the Plaintiff. He submits that when the Plaintiff's counsel chose not to proceed with the inter partes hearing of the Anton Piller order application then it would mean that Enclosure 2 is therefore withdrawn and hence the 6th Defendant is entitled to costs for the reasons that: i ii The name of the 6th Defendant appears as a Defendant in the suit. The 6th Defendant was forced to appear and had filed the necessary papers to oppose this application which had occasioned costs to the 6th Defendant; Plaintiff had waited until the 11th hour to decide not to proceed with the hearing of the inter partes Anton Piller order.

Counsel for the 1st and the 4th Defendants adopted the submission of the 6th Defendant and insisted that costs is to be borne by the Plaintiff as the effect of the Plaintiff in not proceeding with the inter partes hearing is a withdrawal of the Anton Piller application in Enclosure 2. Counsel further submits that the Plaintiff after obtaining the ex parte order had searched the 1st Defendant's premises and obtained documents belonging to the 1st Defendants. Since the Plaintiff is withdrawing its application for the inter partes hearing of Enclosure 2, then whatever documents or photocopies thereof that had been seized from the 1st Defendant's premises pursuant to the ex parte order ought to be returned to the 1st Defendant, and the Plaintiff is to be excluded from relying or referring to those documents in the action herein. The 1st Defendant sees this as an abuse of courts process for the Plaintiff to move the court for an ex parte order, search through the premises of the 1st Defendant and then not prepared to proceed with the inter parte hearing of Enclosure 2. Documents which were obtained through abuse of courts process were obtained unlawfully and hence cannot be relied on. With respect to counsel for the Defendants, the argument by the counsel was flawed. The fact that the Plaintiff is not proceeding with the inter partes hearing of the Anton Piller Order in Enclosure 2 does not amount to the withdrawal of the application for the Anton Piller Order of Enclosure 2. There had not been any application by the Plaintiff for the withdrawal of the Anton Piller order granted ex parte on 3.4.2008. As far as the ex parte Anton Piller Order which had been granted by this court on 3.4.2008, it stands good, until and unless it is set aside. (Refer to the case of GMX Associates Pte Ltd & Anor v Lee Yew Pooi (Berniaga di bawah nama dan gaya Universal Trading Co) As for paragraph 12 of the ex parte order where it provides for the return date for the inter partes hearing that is a matter of practice which is normally done by the courts in the usual course of events pursuant to 0 29 r (2B) of the RHC 1980 after an ex parte injunction order is granted. In our present circumstances where the Anton Piller Order has already been executed and spent, there is no further need or purpose to proceed with the inter partes hearing anymore. By not proceeding with the inter partes hearing, it by no means meant that the said order was wrong or withdrawn. I repeat again here that, it is for the Defendants to apply for the discharge/ setting aside of the ex parte order if the Defendant is of the view that it had been wrongly granted by the court. The Defendants have not done so in the present situation. Until that happens, the ex parte order dated 3.4.2008 stands. Hence the argument by the Defendant's counsel that Enclosure 2 is withdrawn is clearly misconceived. Accordingly, the issue of costs does not arise as the validity of the ex parte order has not been challenged to date. Similarly, the issue in returning the documents obtained and taken by the Plaintiff from the premises of the 1st Defendant's, does not arise. Therefore, premised on the above, I do no see the need to proceed with the inter partes hearing of Enclosure 2. Costs in the cause. ENCLOSURE 14: This is the 6th Defendant's application to set aside the ex parte order Anton Piller Order dated 3.4.2008 which had been served on her. It is to be noted that the 6th Defendant has been cited as a co-Defendant in the main suit therein. However as far as the Anton Piller Order is concerned it is against the 1st Defendant. The 6th Defendant happens to

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be the Director in the 1st Defendant. The ex parte Anton Piller Order was served on the 6th Defendant in her capacity as the Director of the 1st Defendant, not in her capacity as the 6th Defendant in the main suit herein. It is not the 6th Defendant's personal premises that the Plaintiff was entering. The ex parte order was on the 1st Defendant. The 1st Defendant being a company would have officers to act for it, hence the order was served on the 6th Defendant. The 6th Defendant has no role to play as far as the Anton Piller Order is concerned, except as Director of the 1st Defendant in instructing her officers or subordinates to comply with the ex parte Anton Piller Order served on the 1st Defendant. The 6th Defendant does not derive personal capacity to set aside the ex parte order. She, however could have instructed counsel to set aside the ex parte order on behalf of the 1st Defendant. Here, the circumstances and facts shows that the 1st Defendant have not made any application to set aside the ex parte Anton Piller Order. Therefore the 6th Defendant is thus not entitled to any costs when the Plaintiff did not proceed with the inter partes hearing of Enclosure 2. She has no locus to apply to set aside the ex parte order dated 3.4.2008. I hereby dismiss the application by the 6th Defendant in Enclosure 14 with costs.

Malayan Law Journal Reports/2008/Volume 6/Descente Ltd v GS Gill Sdn Bhd - [2008] 6 MLJ 181b - 25 August 2005 4 pages [2008] 6 MLJ 181b

Descente Ltd v GS Gill Sdn Bhd

See also: [2008] 6 MLJ 181 HIGH COURT (KUALA LUMPUR) SUIT NO D7(D5)-22-491 OF 1997 25 August 2005 Legislation referred to Evidence Act 1950 s 115 O 45(7)

Rules of the High Court 1980

Asmet Nasaruddin (Linda Wang & Ooi Aik Hin with him) for the plaintiff. Jagjit Singh (Melvin Selvam with him) for the defendant. T Selventhiranathan J: [1] The plaintiff in this case is Descente Limited, a company incorporated under the laws of Japan. The defendant is GS Gill Sdn Bhd, a company incorporated under the laws of Malaysia. [2] The plaintiff and the defendant entered into a business relationship over a period of time, commencing from the 1 November 1991, as evidenced by an agreement entered into between the parties which was effective from 1 November 1991 to 31 December 1994, a period of three years and two months. [3] This agreement, with the necessary modifications, was advanced in a second licence agreement entered into between the parties for the period 1 January 1995 to 31 December 1995. However, the parties signed the agreement on 4 July 1995. That notwithstanding, it is clear from the evidence that has been adduced,

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that the parties continued dealing with each other on the basis of the first licence agreement, between the expiry of that first licence agreement and the signing of the second licence agreement. That was why the second licence agreement was to encapsulate the period of one year from 1 January to 31 December 1995. [4] The parties then entered into a third licence agreement on 26 August 1996, encompassing the period 1 January 1996 to 31 December 1996. [5] The plaintiff contended that the defendant had breached the terms of the third licence agreement and therefore, by a letter dated 19 June 1997, which was transmitted by facsimile to the defendant, the plaintiff purported to terminate the licence agreement with immediate effect. [6] The reason contained in that notice of termination was that the defendant had breached art 9.7 in the third licence agreement, whereby the defendant had exported the products in question to Hong Kong contrary to an express prohibition against such export contained in the agreement. [7] I hasten to add that under the licence agreement, ie, the third licence agreement, the defendant was given the exclusive right to distribute and market the products of the plaintiff bearing the Le Coq Sportif trademark and device within the territory as defined in that agreement. That territory comprised the countries of Malaysia and Singapore. [8] The details of the breach of the licence agreement were purportedly the purchase of the trademarked products by one Isaac Leung Tat Kwong, PW7, from the premises of the defendant at Jalan Tuanku Abdul Rahman, Kuala Lumpur, on 30 December 1996, and subsequently sent to Hong Kong by the defendant. [9] It was Isaac Leung's evidence that he had visited the premises of the defendant on 8 August 1996 where he had met an employee of the defendant, one Kalwant Singh, and had discussed. the possibility of the defendant exporting the Le Coq Sportif products to Hong Kong. [10] This was followed by a subsequent visit on 30 December 1996, during which visit Isaac Leung alleged that he had not only met Kalwant Singh, but also the chairman and director of the defendant, Dato GS Gill, DW1, and Ms Premjeet Gill, DW6, during that visit, and another employee. [11] During this visit Isaac Leung stated that he had discussed the possibility of the defendant exporting the licenced products to Hong Kong. He was informed that this was possible but, according to him, Kalwant Singh had told him that if subsequent exports were to be done, it would have to be done under another company associated with the defendant company by the name of Gillace Sdn Bhd. [12] Isaac Leung also stated that DW1, Dato GS Gill, had told him that one had to be careful about such export, because the defendant was not allowed to export the products under the third licence agreement. [13] Be that as it may, the upshot of it was that Isaac Leung paid US$5,000 in cash for the products which he purchased from the defendant. He was given a receipt for this deposit that he had made, and subsequently the products were received by Isaac Leung as well as the representative of Rouse & Company International Hong Kong Limited. [14] The products which were purchased by Isaac Leung were under a company which he had set up for this purpose called Octopus Industrial Company in Hong Kong. The products were sent to the company in Hong Kong at that address and, at Isaac Leung's behest, they were diverted to a firm of solicitors where they were received. [15] There is no dispute that the products were in fact sent to Hong Kong, as evidenced in exh P20 and related exhibits. Exhibit P20 shows 11 different items of various products which were sent, and each item consisted of 50 of those products; in other words, there were 550 such products in all. [16] Isaac Leung collected one of each as samples when he made the deposit payment on 30 December 1996, and subsequently the balance payment was sent by telegraphic transfer to the defendant's account at Standard Chartered Bank, Jalan Ampang branch, Kuala Lumpur. The balance that was sent included the

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freight charges which were imposed by the defendant. [17] The defendant's stand In relation to this transaction were two-pronged. One, that the defendant had no knowledge of this transaction and that it arose from a conspiracy hatched between Isaac Leung and Rouse & Company and to a certain extent even the solicitors who were instructed by Rouse & Company in Hong Kong on the one hand; and Kalwant Singh, the employee of the defendant, on the other hand. [18] It was contended that Kalwant Singh had been bribed to enter into this transaction because he had no authority whatsoever to sell Le Coq Sportif products or goods. [19] The witnesses for the defendant claimed that his authority only extended to McGill products, and therefore this was done without the knowledge or authorisation of the defendant company. [20] To my mind this was post-occurrence rationalisation. I say this simply because the documents which are contemporaneous at the time speak for themselves. All the documents relating to this transaction were on the letterhead of the defendant company, ie, GS Gill Sdn Bhd, the payment was in US dollars, and it was made into the account of the defendant company. [21] The contention of the defendant that this was an over-the-counter transaction and that it was a service that the defendant was extending to Isaac Leung at his request cannot hold water, in the face of the contemporaneous documents, some of which were not only signed by some of the employees of the defendant company, but they were also signed by the managing director, Ms Premjeet Gill, PW6, and the accountant of the defendant company, Ms Toe Lay Hoon, PW9. The balance was shown in the records of the company, the defendant company, as monies which were owing to the defendant company. [22] If, as the defendant contended, that this was a mere over-the-counter sale transaction, then it demolishes the defendant's first argument that Kalwant Singh was in league with Isaac Leung and Rouse & Company, as well as the solicitors from Hong Kong, to set this whole matter up. [23] As background to this episode, one has to refer to the earlier correspondence between the defendant company and one wholly owned subsidiary of the plaintiff, Torubion Limited, incorporated in Japan. The defendant company had largely carried out communications with Torubion, which it treated as an agent of the plaintiff. [24] It may, perhaps, be apt at this juncture to deal with one of the objections that was taken, as to the locus standi of the plaintiff to bring this action, stating that it was Torubion which should have brought this action and not Descente Limited. [25] I find that contention is without basis. Furthermore, the defendant is estopped from raising this under s 115 of the Evidence Act 1950, as estoppel operates against the defendant. The defendant had treated Torubion as to all intents and purposes as an agent of the plaintiff in this regard, and It is the plaintiff who is the rightful owner of the trademark and device in Malaysia. [26] Going back to what had transpired between the parties. Prior to the third licence agreement, evidence was led that the plaintiff was not happy with the manner in which the defendant was controlling the production of the licensed goods in Malaysia, in that considerable quantities of such goods which had been made in Malaysia had found their way into the Japan market. [27] The defendant gave assurances that it had nothing to do with these incidents of Malaysia-made goods which were the plaintiffs licensed products having found their way into Japan. In fact, DW1, Dato' GS Gill, did say that there was no way in which the defendant could control people who had bought these products, and if they found their way into Japan, or for that matter, any other place outside the territory, the territory being the countries of Malaysia and Singapore [28] This is acceptable because the defendant could not be expected to have 100 per cent control over the subcontractors, and suppliers of the licensed products to prevent their going out. However, it would appear that the plaintiff must have entertained doubts as to whether or not the defendant itself was indulging in

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activities which resulted in the licensed products finding their way into markets outside the licensed territory. Hence, the plaintiff mounted what I would term as a sting operation which, to my mind, was in legitimate protection of its vested right in the licensed product. [29] Learned counsel for the defendant went to great lengths to say that the plaintiff mounted this sting operation in order to get out of renewing the licence agreement with the defendant. With respect, I am unable to agree. [30] The evidence shows that the first licence agreement stretched over a period of three years and two months until 31 December 1994. However, before that period, or before the life of the licence had expired, the plaintiff had already raised doubts in relation to the defendant being involved in exports out of Malaysia. [31] In this context, I hasten to say that the doubts were not in the defendant being involved directly, but that the defendant was not exercising sufficient control over the suppliers and subcontractors. [32] The evidence also shows that the defendant wanted the licence to be valid for a longer period than one year at a time. The second licence agreement stretched over one year. [33] The defendant was of the view that this was not satisfactory and had repeatedly asked the plaintiff to give a longer period for the licence. The plaintiff responded by saying that unless the plaintiff was assured or guaranteed that the defendant would exercise greater control over the licenced products within the territory, it could not accede to such request. [34] It was the stand of the defendant that the third licence agreement expired on 31 December 1996, and therefore, pursuant to that licence agreement, the defendant was entitled to sell off the stock it had over a period of six months until 30 June 1997, in accordance with the third licence agreement. [35] The plaintiff, on the other hand, contended that the third licence agreement was in effect beyond the 31 December 1996 by virtue of. the dealings between the parties, which had proceeded as if the licence agreement had been extended. [36] It is my finding of fact that the third licence agreement was in force by virtue of the conduct of the parties up to the time it was terminated on 19 June 1997. The evidence is overwhelming in this regard. [37] First, all I need to do is refer to the monthly report which was sent by the defendant to the plaintiff showing the sales of the licenced products which had taken place from January 1997 until May 1997. If one were to look at the last two monthly reports, ie, exhs P167 and P168, at the portion headed 'D inventory', it shows beyond a shadow of a doubt that the inventory between April and May increased overall. If the defendant was only involved in selling off the stock in trade, there should have been a decrease in inventory and not an increase. [38] I do concede that there are certain items which show a slight decrease. However, taken overall, there is an increase, and specific items show an increase. Therefore, this is not the act of a party which can contend that the licence agreement came to an end upon its expiry on 31 December 1996. [39] Added to that is the facsimile transmission from DW3, Mr Christopher Lam, an employee of the defendant, to the plaintiff on 19 March 1997. This is exh P57, the contents of which clearly show that it was within the ken of the defendant that the licence agreement was to be renewed, and this letter clearly inveigled the plaintiff to give some assurance of that. [40] I find further evidence of this in exh D144, which is the defendant's own exhibit, which was a facsimile transmission of 19 June 1997 to the plaintiff, wherein DW3, Christopher Lam, states as follows:
As I have planned ahead as far as six months where production is concerned, materials have been purchased and they are under production. I do not know what I am going to do with ail those goods.

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[41] Then there is a further exh D142 which was from DW1, Dato GS Gill himself, to Mr Oshima of Torubion, dated 20 June 1997. By this facsimile transmission the sender, inter alia, invited Mr Oshima or anyone else '... to come down to check all our records and if you can find anything that we have done against Torubion, you can fire us'. [42] This clearly shows that up to that point the defendant was treating the third licence agreement as being effective but for the notice of termination of 19 June 1997. [43] Moving further on the facts. The plaintiff obtained Anton Piller orders on 17 June 1997 and 1 July 1997. Pursuant to the first Anton Piller order, it raided the defendant's premises. The raid was carried out properly. It was in fact a search of the premises because there is in evidence that one of the persons present on behalf of the plaintiff on 19 June 1997 saw a box which was described as being one foot square being taken out from the premises. [44] Pursuant to the order, that person could have insisted that the box not be taken out, but it is in evidence that PW6, Premjeet Gill, refused access to that box. Therefore, we do not know what the contents of that box were, and I make no finding on that. [45] I also make no finding on the fact that there was a large room on the second floor of the premises to which access was denied. [46] I state these two instances in passing because during the course of the trial it was made to appear as if the plaintiff and the plaintiffs representatives had acted in a very high-handed manner in searching the premises of the defendant. [47] Any search of this nature will in its wake bring curiosity among those who are around, particularly in a busy thoroughfare as Jalan Tuanku Abdul Rahman, which is also a shopping area. However, the conduct of the plaintiffs representatives in the search cannot be said to be anything but proper. It was carried out in a very cordial manner, I believe, to the extent that PW6, Premjeet Gill, offered some drinks, coffee I believe, to Ms Linda Wang and another person there. [48] Subsequent to these two Anton Piller orders, the defendant applied to set aside the same vide encls 18 and 21 in the file. [49] The plaintiff, on the other hand, commenced committal proceedings against DW1, Dato GS Gill, for having acted in defiance of those two orders, This was on the basis that despite the search of the defendant's premises and the carting away of the Le Coq Sportif products, the defendant had continued selling these products, as there was evidence which showed the same. [50] The enclosure in respect of the committal proceedings was encl 72 in the file. When these three enclosures came to be heard before me, Encik Asmet, counsel for the plaintiff, was of the view that encl 72 should be heard first, and that the respondent therein, ie Dato' GS Gill, should purge his contempt for having disobeyed the two Anton Piller orders as a director of the defendant company. [51] Mr Jagjit Singh on the other hand, learned counsel for the defendant, insisted that encls 18 and 21 should be dealt with first in their order of chronology. [52] I did intimate to the parties at that juncture that apart from encl 72, which involved the committal proceedings which could be taken separately, the other two enclosures, ie 18 and 21, could be taken at the trial of this action as the trial dates had already been fixed and the trial was to commence in the following month of February last year. [53] Learned counsel for the defendant during the proceedings relating to those enclosures made an impassioned plea for the trial to proceed expeditiously on account of the fact that DW1 was a person of advanced years and he had been waiting for this matter to be disposed of. [54] I accept that. I would also like to say, by way of explanation, that the file in this matter was not in my

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court from the beginning. It had been in Commercial Court 5, and I was given to understand that when the trial was about to commence, the learned counsel for the defendant had taken objection to the learned judge in that court (Dato' Kang Hwee Gee J) hearing the matter, and asked him to recuse himself, which the learned judge did. [55] As a result of that, this very bulky file was transferred to my court for hearing, and it had to take its place beside other files which had also been transferred to my court in relation to pre-2000 matters. However, the transfer was effected sometime in 2002. But these applications on behalf of the defendant in encls 18 and 21 had been made and were pending. The application in encl 72 was also made. All these three enclosures had not been heard and disposed of in Commercial Court 5. Therefore, they were carried over to my court. [56] I would have thought that had the defendant been anxious to proceed with the trial of the matter, then the better course would have been for encls 18 and 21 to have been taken during the course of the trial where parol evidence was to be adduced, and such evidence would have been more complete than the affidavit evidence, which the court was constrained to consider when deciding encls 18 and 21. [57] Be that as it may, I proceeded to hear those applications over a period of time, at the end of which I allowed the applications, ie to set aside the Anton Piller orders of 17 June and 1 July 1997. [58] My reasons in doing so were simple. The Anton Piller orders had been obtained contrary to the Rules of the High Court 1980 and the practice direction, I believe it was 1 of 92, which had been issued in relation to the filing of affidavits in Bahasa Malaysia. [59] The affidavit of PW1, Masato Hirooka, had been affirmed on 13 June 1997 in the English language. It was signed, I believe, in kenji characters, and there was nothing in the jurat to show that that affidavit had been translated to the deponent in the Japanese language, or that he understood the English language. Further, no Bahasa Malaysia version of the affidavit was filed. [60] I also bore in mind that Dato' Haidar bin Mohd Noor, who was the judge in Commercial Court 5 at the material time, had on a similar ground upheld the objection of the defendant to the same affidavit. That matter had gone on appeal to the Court of Appeal, which in turn had upheld the decision of the learned judge. [61] I therefore was of the view that on this technicality the applications of the defendant in encls 18 and 21 should be allowed with costs. [62] In the normal course of events, pursuant to the undertaking which is given by the plaintiff in relation to the obtaining of an injunction to pay damages to the aggrieved party should the injunction be set aside, there would be an order for the assessment of damages. Learned counsel for the defendant wanted such assessment to be made before the registrar forthwith, and for the defendant to be paid the damages so assessed. [63] I, however, made no order in respect of prayer 2 in those two enclosures, ie encls 18 and 21, for the assessment of damages because of the concerns that learned counsel for the defendant had voiced in relation to the trial not proceeding expeditiously earlier. The pleadings also clearly disclosed that there was a counterclaim for damages by the defendant. Therefore, it was not only expedient, but to exercise commonsense to have the whole matter determined during the trial. That was why I did not order an assessment of damages by the registrar at that juncture. [64] Moving on to encl 72. As the Anton Piller orders of 17 June and 1 July 1997 had been set aside, and as they had been obtained on the basis of a defective affidavit, therefore the committal proceedings against DW1, in his capacity as the director of the defendant, could not stand. For that reason, I dismissed the committal proceedings with costs. [65] An additional reason was that it appeared from the cause papers that the Anton Piller orders had been served on the defendant company marked 'Attention of Dato' GS Gill'. Order 45(7) of the Rules of the High Court 1980 enjoin that where execution is to be sought against any party pursuant to an order served on it,

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there should be personal service of that order. [66] I found as a fact that there had been no personal service of the two Anton Piller orders on the respondent in encl 72, a director of the defendant company, and as such the application for committal proceedings on that ground had to fail as well. [67] Subsequent to the search of the defendant's premises and the carting away of all the items, as revealed in the search list, other licensed products were left behind. They were not removed. [68] The evidence adduced on behalf of the plaintiff shows' that. subsequent sales of the licensed products did take place until as late as April 1998. Therefore, it would appear that the defendant had not suffered damage as a result of the Anton Filler orders because the defendant continued to trade In the licensed products. However, it is my finding that the defendant should have ceased so trading on 19 June 1997. [69] The third licence agreement, as I have earlier said, extended into 1997, and in this regard, although learned counsel for; the defendant went to great pains to impress upon the court that the third licence agreement expired on 31 December 1996, his own letter to Dato' GS Gill, as chairman of the defendant, which is exh D53B, dated 9 October 1995, shows that at that point in time he was of the view that the first licence agreement dated 16 December 1991 was valid and subsisting in relation to differences thai the defendant had had with the1 manufacturer of Le Coq Sportif products in the form of a company called Procut Garment Manufacturing Sdn Bhd ('Procut'). [70] Therefore, this document of the defendant itself shows that that was the stand that the defendant had taken, or counsel for the defendant had taken, in relation to the first licence agreement, and that that advice was accepted by the defendant, as is evidenced by related correspondence between the defendant and Torubion, as to whether action should be taken against Procut. [71] As the question of the exportation of the licenced products was very hotly disputed by the defendant through his counsel, I will deal with that at greater length. [72] It was the stand of the defendant that Kalwant Singh was a renegade, as far as the defendant was concerned, because he was prepared to accept bribes from Isaac Leung to put the defendant in the predicament in which the defendant found itself. [73] Let us examine the evidence. The calling card which Kalwant Singh handed over to Isaac Leung with his name on it had the defendant company's name on it. In other words, it was the defendant's calling card with Kalwant Singh as executive on it. [74] Then there is the disclaimer in exh D144 by Christopher Lam that Kalwant Singh had no authority to handle the sale of Le Coq Sportif products. However, the issue of Kalwant Singh being bribed by Isaac Leung, I believe, was abandoned. That notwithstanding, the question arises as to whether there is any evidence of such bribing or collusion between Kalwant Singh and Isaac Leung and related parties. [75] It cannot be gain said that Isaac Leung did not know Kalwant Singh from Adam. Isaac Leung is from Hong Kong. Kalwant Singh is from Malaysia. There has been no evidence of any connection between them or their having met prior to 8 August 1996. [76] Then we have exh D142 from Dato' GS Gill to Mr Oshima of Torubion. This is what he had to say as of 20 June 1997 in relation to Kalwant Singh:
I have just come back to the office and I am a little surprised of what has happened. I have checked up the whole matter. This man, Kalwant, who was mentioned in the report has nothing to do with Le Coq Sportif. His job is to sell McGill equipment. All that he was trying to do was to show that he was doing a lot.

[77] To me, this, coming from the chairman of the employer, meant that Kalwant Singh was an over enthusiastic employee; nothing more, nothing less. That letter goes on to say:

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This was just plain talk. All the goods which have been sold to this fellow in Hong Kong were taken from the retail shop and these goods were meant for retail. I am surprised that my name has been brought in to say to be careful about shipment. I have always warned my staff that Le Coq Sportif goods and Adidas goods cannot be shipped outside Malaysia and Singapore.

[78] Again:
From the report which you have seen I was informed that the fellow who came to see Kalwant paid him some under-table money. With the result all the signed papers were done by Kalwant and nobody else. I am really more than surprised of what has happened because your legal people and auditors have seen and checked all our books, sales, purchases and cash memos. It is not our intention to cheat Torubion at ali. This has been a sad part this has happened without my knowledge nor my daughter's- knowledge as this was done by the retail shop and of course, Kalwant has talked to the Hong Kong chap how big he was.

[79] Pausing at this juncture, it is my finding of fact that PW6, Premjeet Gill, did have knowledge of this transaction because the documents, ie the exhibits relating to the Hong Kong transaction, were signed by her, at least some of them, and they were further signed by the accountant as well. These documents found their way into the books of the defendant, and it is therefore not within the power of the defendant to say it had no knowledge. Kalwant Singh was its-employee, and it has to accept responsibility for the acts of its employee. These acts were carried out in the shop, which are the normal business premises of the defendant company. There was nothing untoward in this episode for Isaac Leung to think otherwise. [80] Going further. There is again an exhibit of the defendant itself, which is exh D143, again written by DW1, Dato' GS Gill, to Mr Yoshiji Masuda on 6 February 1998. This was a post-event letter. I quote from this:
Now coming to this problem.where this chap bought 50 sets of tracksuits from our retail department downstairs, of which I swear to you I was not aware at all.

[81] The chairman of the defendant company stated here that there were only 50 sets of tracksuits. Exhibit P20 shows there were 550 sets, which is 11 times that. [82] By this time DW1 would have been well advised as to what had transpired. He would have been able to see matters for himself. His daughter, DW6, was in a position to advise him, together with Christopher Lam, I believe DW3, and the accountant, DW9. Yet this was what was stated by the defendant, and it is to my mind a self-serving letter which was intended to play down what had taken place. [83] Going on from there, again in exh D143, this is what he states:
In the retail section we have tourists from all over the world who come and purchase all their- requirements because, as you know, Malaysian sports goods are duty-free. The salesman who attended to the Hong Kong man has admitted to our lawyers that he was bribed to send the goods to Hong Kong, which was without my knowledge at all. Since then this salesman has been sacked.

[84] It is pertinent to note that at this point of writing exh D143, DW1 had or was possessed of knowledge and information that. Kalwant Singh had admitted to his, DW1's, lawyers that he was bribed to send the goods to Hong Kong. [85] If that was so, evidence could have been forthcoming from his lawyers that Kalwant Singh so stated. There is no affidavit from any lawyer to the effect that Kalwant Singh made such an admission. [86] Then it says Kalwant Singh was sacked. However, exh P136, which was given by the defendant to the plaintiff, shows that Kalwant Singh resigned in August 1997. There is a world of difference between resigning from one's post and being sacked. [87] It may well be that post-event an attempt has been made to make Kalwant Singh appear the villain of

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the piece acting in cahoots with Isaac Leung. However, there is no evidence to show this. Coupled with that is the fact that Kalwant Singh, with his admission, would have become a prime witness for the defendant. However, what did the defendant do to secure the attendance of Kalwant Singh for the trial? [88] It is in the evidence of the person who was required to locate Kalwant Singh, I believe he was the adjuster, and he had put in his, report the various attempts in the year 2004 when he embarked upon his odyssey, as it were, to locate Kalwant Singh. By that time the ground was cold. [89] These are events which had happened in June 1997. It behoves the defendant to have taken steps at that time to have either had an affidavit from Kalwant Singh affirmed or to have kept track of Kalwant Singh to make sure that he came to this trial to give evidence of the purported bribery of himself by Isaac Leung. [90] With respect, the evidence which was led on behalf of the defendant to explain the failure of the defendant to call Kalwant Singh militates againstthe defendant's case. Because of the time taken for the case to come to trial, the defendant should have acted with alacrity, particularly so when the defendant wanted this case disposed of speedily, to have tried to locate Kalwant Singh, and not have waited so long, when he was the main plank in the defence and counterclaim to support the defendant's case. [91] In relation to whether this was an act of exporting the goods to Hong Kong or not, the defendant's own witness, DW4, Ng Yew Toh, was very categorical in his evidence-in-chief to say that if a transaction in Malaysia was carried out in US dollars, then applying the practice of the trade, it must be for export purposes only. If it was an act of retail, in other words, a sale over the counter as contended for by the defendant, then the transaction would have to be in Ringgit Malaysia, because it is clear under the law that transactions within the country have to be conducted, normal transactions, in Ringgit Malaysia. [92] For instance, I cannot purchase goods in a shop in Malaysia and use US dollars or pounds sterling. I can take judicial notice of this. Because the shopkeeper will tell me, 'Please go to a money changer and change it into Malaysian currency to buy this'. But it is in the defendant's own evidence, through DW4, that this was an act of export. [93] During the search of the defendant's premises some other documents were also discovered which were in relation to sending what were described as samples of the Le Coq Sportif goods to a company called Lenric Limited in West Sussex, United Kingdom. [94] The defendant's explanation for this was that Lenric wanted samples to see what the defendant was capable of producing by way of those goods. Therefore, as the defendant was in a hurry to have the same dispatched, if I remember correctly, DW1, Dato' GS Gill said that the high commissioner himself had called him to ask for this to be expedited. Therefore, he sent this off. [95] However, evidence was adduced by the defendant's witnesses that the goods could have been sent without the Le Coq Sportif device and trademark on it. In this context, I believe the licence agreement, exh P9, clearly stated as to the goods being manufactured under the control of the plaintiff. Therefore, one wonders whether, even if they were samples that were sent, whether it would not behove the defendant to obtain the approval of the plaintiff to send this off because essentially it was a licensed good that thedefendant was dealing with, and the proprietary interest in that device, in the trademark device, belonged to the plaintiff. However, not very much turns on that, as to whether it was a sample or whether it was sent off as a sample and whether it was exported. It may well come within the prohibition of export, despite being a sample, within the terms of the licence agreement, exh P9. [96] It may not be amiss for me at this juncture to examine the salient provisions of the third licence agreement, exh P9. By art 2.1 of that agreement, the plaintiff granted to the defendant the exclusive right in the territory, as defined, to promote and distribute the products of the plaintiff and to use the trademarks of the. plaintiff for that purpose alone and for no other. [97] By art 4, all material used in the manufacture of the licensed products were to meet with the quality standards consistent with the reputation of the licensor, ie, the plaintiff, and were to be subject to the quality control procedure as set out in arts 5 and 7.

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[98] While the licence agreement was in force, by art 9 the defendant was required to promote and distribute the licenced products, and was to give monthly returns and provide further information on a quarterly basis. With this in mind, one can see that the defendant continued to treat the licence agreement in 1997 as being in force by virtue of complying with art 9 in the reports that were sent to the plaintiff by DW3, Christopher Lam. [99] By art 9.7 the defendant was prohibited from exporting directly or indirectly any product outside the territory, and it guaranteed that it would take all reasonable steps to ensure that its distributors, affiliates and/or subcontractors would refrain from exporting, directly or indirectly, the licensced products outside the territory. [100] Under this same art 9.7, the defendant as licensee was required to permit the inspection or investigation of its compliance with its obligations under art 9.7 by an authorised representative or representatives of the plaintiff as licensor at any time. One may even say that the purchase of the goods by Isaac Leung on 30 December 1996 could be argued to have been pursuant to this right which the defendant gave the plaintiff. Therefore, nothing sinister should be read into that activity. [101] By art 15.1 the licensor was permitted to terminate the licence agreement forthwith by written notice, under para (d), if the licensee failed to comply with the obligation described in art 9.7. [102] Having these provisions in mind, when the plaintiff found that the defendant had contravened art 9.7, the plaintiff proceeded to invoke the provisions of art 15.1(d) to terminate the agreement forthwith. [103] In these circumstances, the defendant, irrespective of any Anton Piller orders which the plaintiff may have sought in aid of the notice of termination, was required to comply with such notice. [104] Learned counsel for the defendant argued strenuously that the defendant had a right under art 15.6(e) to continue selling off stocks for six months, ie from 1 January 1997 to 30 June 1997, as provided for in that article. [105] With respect, this right for the licensee to sell off such stocks within six months can only arise in two situations: one, where the licence had expired by effluxion of time. In other words, if it had come to an end on 31 December 1996. However, it is my finding of fact, as mentioned earlier as well, that the licence agreement, the third licence agreement, inured beyond 31 December 1996 up to its termination on 19 June 1997. Therefore, the licensee, or the defendant as licensee, did not have the right to sell off the stocks for those six months. [106] The other right of the defendant as licensee to sell off the stocks for six months would only arise if the licensee itself, ie the defendant, terminated the licence. Here the defendant did not terminate the licence, as one may refer back to what I had said earlier, where DW1, Data' Gill, had informed the plaintiff that if the plaintiff found anything wrong, '... you could fire us'. So there was no question of the defendant terminating the licence. [107] During the course of proceedings, parties were a little puzzled as to what the phrase 'except exclusivity' meant in art 15.6(e). Having studied the agreement in detail, I am of the view that that phrase simply means this: That where the defendant as licensee exercised a right where the licence had expired to sell off the stocks for six months from the expiry, or where the defendant had itself terminated the licence, and continued to sell the stocks for six months, the defendant could do so, but it failed to enjoy exclusivity in the territory of selling the licensed products in those circumstances. [108] This would be in consonance with the agreement, because. then the licence agreement would have come to an end and the plaintiff as licensor must be at liberty to look for other parties to step into the shoes of the licensee, in the event that the plaintiff decided to have this agreement continue with other parties. [109] In the course of the trial DW1, Dato' Gill, also said, I believe during cross-examination, something to the effect that someone in the plaintiff company during one of his visits to Japan had told him an

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over-the-counter sale was permissible. This was not stated in very categorical terms. From his demeanour, I noticed that he was very, hesitant in stating this. But should it be so, then a contemporaneous document should have been forthcoming from the defendant to say that the plaintiff itself had allowed for such a thing, and if at all, it was to contend so, then the full scenario should have been given as tq the purchase by Isaac Leung, or a situation like that, for the plaintiff to have agreed. Because the agreement shows that in most of the instances under the agreement, if anything is to be done, it is to be done in writing. Therefore, it cannot be envisaged that the plaintiff would willingly agree to an exception to be made to the prohibition against exportation out of the territory, as proscribed in art 9.7, merely by word of mouth. [110] I go on to say that in civil cases the burden of proof is on a balance of probabilities. It is not proof beyond a reasonable doubt. Learned counsel for the defendant at times proceeded at length to cross-examine witnesses on matters which had already been agreed upon in the agreed facts, but I gave him sufficient latitude when he assured me that he was reaching the matter in point. Particularly in relation to the goods which were sent to Hong Kong, his cross-examination was very lengthy. To my mind that was a waste of time because it was never in dispute between the parties that the goods did go to Hong Kong. This case is not a criminal case where you have to have a chain of evidence and you have to prove an unbroken chain of evidence. [111] Perhaps, with respect to Mr Jagit Singh, he brought his experience in the criminal law sphere into the civil proceedings sphere and was proceeding to the extent that he wanted the plaintiff to prove everything to the hilt. That is not the standard of proof that is applicable in civil proceedings. [112] The fact that any of the witnesses, and here I state general principles which I have borne in mind in coming to a decision, that a witness is unshakeable in cross-examination or has been unshaken in cross-examination, is not an acid test of credibility. What is important is whether the evidence of that witness is acceptable, having the full matrix of the facts and the documents in mind, and whether that witness' evidence is credible or not. This observation applies with equal force to witnesses for the plaintiff as well as for the defendant. [113] I have embarked upon an examination of the evidence with this principle in mind, besides, of course, other principles which are applicable. [114] For all the foregoing reasons, I find for the plaintiff in this action, with costs being awarded against the defendant. I dismiss the defence and the counterclaim with costs. Appeals dismissed with costs.

Reported by Andrew Christopher Simon

Malayan Law Journal Reports/2006/Volume 2/Apparatech (M) Sdn Bhd v Ng Hock Chong & Anor - [2006] 2 MLJ 61 - 10 October 2005 23 pages [2006] 2 MLJ 61

Apparatech (M) Sdn Bhd v Ng Hock Chong & Anor

HIGH COURT (KUALA LUMPUR) ABDUL MALIK ISHAK J CIVIL SUIT NO D4-22-1442 of 2002 10 October 2005 Civil Procedure -- Contempt of court -- Breach of court order -- Whether alleged contemnor could be heard before he had purged the contempt

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Civil Procedure -- Judgments and orders -- Anton Piller order -- Setting aside -- Whether order too wide, imprecise, vague and oppressive There were two enclosures related to each other. The first encl 14 was the defendants' application to set aside the Anton Piller order dated 20 September 2002 that was obtained by the plaintiff on the grounds that there was non-compliance with O 29 r 1(2A) of the Rules of the High Court 1980, want of disclosure and the privilege against self incrimination rule, non-justification of granting an Anton Piller order and that the Anton Piller order was too wide, imprecise, vague and oppressive. Enclosure 46 was the plaintiff's application for committal proceeding against a Mr Koay Chee Hong, the director of the second defendant, for contempt. The first charge alleged that Mr Koay had 'deliberately and/or intentionally and/or wilfully refused to allow the named persons to carry out the execution of the Anton Piller order on 23 September 2002 at or about 5pm at the first floor of the premises.' It was further stated that the Anton Piller order was not specific and in fact vague and ambiguous. Enclosure 46 will be considered first followed by encl 14. Held, dimissing encl 46 and allowing encl 14: (1) The fact that a contemnor who disobeys an order of the court and thus cannot be heard nor embark in the same proceeding until he has purged his contempt is a rather out dated general rule that needs to be revamped. How could the contemnor purge his contempt if he is not allowed to be heard? The antiquated general rule will not bar nor prevent a contemnor to clear the very contempt which he is said to have committed (see para 3); Hadkinson v Hadkinson [1952] 2 All ER 567 followed. It was clear beyond peradventure that the plaintiff had failed to establish the essential ingredients of the two charges levelled against Mr Koay, in encl 46, beyond reasonable doubt. Furthermore, the list of items as set out in Schedule 1 of the Anton Piller order which were sought to be searched, inspected, photographed and delivered for safe keeping of the plaintiff's solicitors were so unquestionably vague and/or ambiguous in description as to make it practically impossible for Koay to comply with the said order. To say the least, the Anton Piller order was in the nature of a fishing expedition (see para 21); Mah Siew Keong v Bayu Gamitan Sdn Bhd and other appeals [2002] 2 MLJ 107 followed. 2 MLJ 61 at 62 The plaintiff in obtaining the Anton Piller order had not disclosed to this court matters which were self-incriminating in nature and which were in breach of s 123 of the Evidence Act 1950 particularly in relation to the production of the documents sought for in the Anton Piller order 'requesting all information, documents, records or otherwise pertaining to the tender strategy for the various projects of the Ministry of Education, Ministry of Labour, Ministry of Defence, Ministry of Youth and Sports|PO.' (see para 45). The Anton Piller order granted to the plaintiff on an ex parte basis was certainly too wide, imprecise, vague and oppressive in the extreme. The defendants were put in a dilemma as to what documents that were covered under the Anton Piller order. All orders of the court should be expressed in clear and unambiguous terms especially where (as in the case of injunctions) the failure to comply will constitute contempt of court. An injunction should be framed so as to make it plain to those to whom it is directed, and to those who may be affected by it, the nature of the obligation arising from the order, so that they may know precisely what they are required to do or abstain from doing. These principles of law when applied to the facts of the present case weighed heavily in favour of the defendants.(see paras 54-55).

(2)

(3)

(4)

Terdapat dua lampiran yang berkaitan antara satu sama lain. Pertama, lampiran 14 merupakan permohona perayu untuk mngenepikan perintah Anton Piller bertarikh 20 September 2002 yang diperolehi oleh plaintif atas sebab ketidakpatuhan A 29 k 1(2A) Kaedah-Kaedah Mahkaamh TInggi 1980, keperluan pendedahan dan perlindungan terhadap kaedah yang menunjukkan kesalahan sendiri, perintah Anton Piller yang diberikan tanpa jiustifikasi dan bahawa perintah Anton Piller itu terlalu luas, tidak tepat, kabur dan menindas.

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Lampiran 46 merupakan permohonan plaintif untuk prosiding komital terhadap En Koay Chee Hong, pengarah defendan kedua, kerana penghinaan. Pertuduhan pertama mengatakan bahawa En Koay telah 'deliberately and/or intentionally and/or wilfully refused to allow the named persons to carry out the execution of the Anton Piller order on 23 September 2002 at or about 5pm at the first floor of the premises.' Ia seterusnya menyatakan bahawa perintah Anton Piller itu tidak spesifik bahkan kabur dan tidak taksa. Lampiran 46 akan dipertimbangkan dahulu diikuti dengan lampiran 14. Diputuskan, menolak lampiran 46 dan membenarkan lampiran 14: (1) Fakta bahawa seseorang yang menghina itu yang tidak mematuhi perintah mahkamah dan oleh demikian todak boleh didengar maupun memulakan dalam prosiding sama sehingga beliau membersihkan penghinaannya merupakan rukun am yang ketinggalan yang perlu diubah. Bagaimana seorang yang melakukan penghinaan itu membersihkan penghinaan itu jika beliau tidak dibenarkan untuk didengar? Rukun am yang lapuk itu tidak akan menghalang seorang yang telah melakukan penghinaan itu membersihkan 2 MLJ 61 at 63 penghinaan yang dikatakan telah dilakukan oleh beliau (lihat perenggan 3); Hadkinson v Hadkinson [1952] 2 All ER 567 diikut. Adalah jelas bahawa plaintif telah gagal untuk membuktikan kandungan penting dalam kedua-dua pertuduhan terhadap En Koay, dalam lampiran 46, melampaui keraguan munasabah. Bahkan, senarai item sepertimana yang dinyatakan dalam Jadual 1 kepada perintah Anton Piller yang dipohon untuk dicari, disiasat, diambil gambar dan diserahkan untuk simpanan peguam plaintif amat kabur dan/atau taksa gambarannya sehingga sukar untuk Koay mematuhi perintah itu. Oleh itu, perintah Anton Piller tersebut tidak tentu tujuannya (lihat perenggan 21);Mah Siew Keong v Bayu Gamitan Sdn Bhd and other appeals [2002] 2 MLJ 107 diikut. Plaintif dalam memperoleh perintah Anton Piller itu tidak mngemukakan kepada mahkamah ini perkara yang bersifat menunjukkkan kesalahan sendiri dan yang melanggar s 123 Akta Keterangan 1950 tertutamanya berkaitan pengemukaan dokumen-dokumen yang dipohon dalam perintah Anton Piller 'requesting all information, documents, records or otherwise pertaining to the tender strategy for the various projects of the Ministry of Education, Ministry of Labour, Ministry of Defence, Ministry of Youth and Sports|PO.' (lihat perenggan 45). Perintah Anton Piller yang diberikan kepada plaintif berasaskan ex parte terlalu luas, tidak tepat, kabur dan menindas. Defendan-defendan dalam dilema berhubung apakah dokumen-dokumen yang terkandung dalam perintah Anton Piller itu. Semua perintah mahkamah sepatutnya menyatakan dengan jelas dan tidak taksa terma-terma terutamanya berhubung (seperti dalam kes injunksi) ketidakpatuhan yang akan membentuk penghinaan mahkamah. Satu injunksi sepatutnya dibentuk agar ia jelas kepada siapa ia diarahkan, dan kepada siapa ia akan memberi kesan, sifat obligasi yang timbul daripada perintah itu, agar mereka dapat mengetahui dengan pasti apa yang patut dilakukan atau dihindarkan daripada melakukannya. Prinsip-prinsip undang-undang tersebut apabila terpakai kepada fakta-fakta dalam kes semasa jelas akan menyebelahi defendan-defendan (lihat perenggan 54-55).

(2)

(3)

(4)

Notes For cases on breach of court order, see 2(1) Mallal's Digest (4th Ed, 2004 Reissue) paras 1543-1561. For cases on setting aside, see 2(2) Mallal's Digest (4th Ed, 2004 Reissue) paras 402-418. Cases referred to Anton Piller KG v Manufacturing Processes Ltd & Ors [1976] 1 All ER 779 Asia Pacific Parcel Tankers Ptd Ltd v The Owners of the Ship or Vessel 'Normar Splendour' [1999] 6 MLJ

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652 Attorney-General v Staffordshire County Council [1905] 1 Ch 336 Booker McConnell plc v Plascow & Ors [1985] RPC 425 (refd) Boyce v Gill (1891) 64 LJ 824 Collins v Wayne Iron Works (1910) 76 Atl 24 2 MLJ 61 at 64 Columbia Picture Industries Inc & Ors v Robinson & Ors [1987] Ch 38; [1986] 3 All ER 338 Commercial Bank of the Near East Plc v P [1989] NLJ 645 Daglish v Jarvie (1851) 20 LJ Ch 475 Distributori Automatici Italia SpA v Holford General Trading Co Ltd [1983] 3 All ER 750 EMI Ltd v Pandit [1975] 1 All ER 418 Garden Cottage Foods Ltd v Milk Marketing Board [1984] 1 AC 130 Hadkinson v Hadkinson [1952] 2 All ER 567 Lian Keow Sdn Bhd v C Paramjothy & Anor [1982] 1 MLJ 217 Mah Siew Keong v Bayu Gamitan Sdn Bhd and other appeals [2002] 2 MLJ 107 Morris v Redland Bricks Ltd [1970] AC 652 O'Regan & Ors v Lambic Productions Ltd (1989) New Law Journal, Vol 139 PMK Rajah v Worldwide Commodities Sdn Bhd & Ors [1985] 1 MLJ 86 R v Kensington Income Tax Commissioners [1917] 1 KB 486 Rank Film Distributors Ltd & Ors v Video Information Centre & Ors [1980] 2 All ER 273 Rank Film Distributors Ltd & Ors v Video Information Centre & Ors [1981] 2 All ER 76 Schmitten v Faules [1893] WN 64 Siporex Trade SA v Comdel Commodities Ltd [1986] NLJ 538 Thermax Ltd v Schott Industrial Glass Ltd [1981] FSR 289 UMAS Sendirian Berhad v RHB Bank Berhad & Anor [2001] 1 AMR 1024 Yousif v Salama [1980] 3 All ER 405 Legislation referred to Evidence Act 1950 s 123

Rules of the High Court 1980 O 29 r 1(2A) Ling Hua Keong (Naraendran Thiagarajah with him) (Isa, Ling & Mok) for the plaintiff.

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Dato' Mahinder Singh Dulku (Tan Kim Soon, Devano Hasbi with him) (Tan Kim Soon & Co) for the defendants. Abdul Malik Ishak J: INTRODUCTION [1] For the sake of expediency, I considered two enclosures in this judgment since they were related to one another. [2] Enclosure 14 was the defendants' application to set aside the Anton Piller order dated 20 September 2002 that was obtained by the plaintiff while encl 46 was the plaintiff's application for committal proceeding against Mr Koay Chee Hong.It would be appropriate to consider encl 46 first. And thereafter encl 14 would be considered. Indeed this was what the parties wanted the court to do. 2 MLJ 61 at 65 [3] Is there a general rule that states that a contemnor will not be heard until he has purged his contempt? Can this general rule be applied in this case so as to deprive the contemnor from taking the stand in the witness box and purge his contempt? These two very simple and basic questions have been the bone of contentions of the legal practitioners in this country. He who disobeys an order of the court cannot be heard nor embark in the same proceeding until he has purged his contempt. It is a rather out dated general rule that needs to be revamped. How could the contemnor purge his contempt if he is not allowed to be heard? Denning LJ, a brilliant judge of his time and is still acknowledged as such, adopted a flexible approach in dealing with this antiquated general rule. According to Denning LJ in Hadkinson v Hadkinson [1952] 2 All ER 567, at p 573, the origin of this general rule can be traced to the canon law which was later adopted by the Chancery Court and the Ecclesiastical court. It seems that this antiquated general rule has its origin during Lord Bacon's time in 1618 which states, inter alia, that:
They that are in contempt... are not to be here [?heard] neither in that suit, nor in any other, except the court of special grace suspend the contempt.

[4] At pp 573-574 of the report in the case of Hadkinson v Hadkinson, Denning LJ aptly said:
The ordinance of Lord Bacon was, however, capable of working great injustice and in the course of practice, it came to be much restricted in scope. It was confined to cases where a party in contempt, that is, a party against whom a writ of attachment had issued or an order for committal had been made, came forward voluntarily and asked for an indulgence in the self-same suit.

Hadkinson v Hadkinson is now the modern authority for contemnors to rely upon. It is an authority that gives the comtemnors the right to be heard in the courts. Factually speaking, the facts of Hadkinson v Hadkinson may be stated in this way. There, the wife was given custody of the son out of the marriage subject to a requirement that the boy should not be taken out of jurisdiction. The wife breached the order and took the son to Australia. The husband applied to the court and the court ordered the wife to bring back the son to England. The wife wanted to appeal against the order of the court but the Court of Appeal refused to hear her appeal until she brought back the son to England. While Romer LJ and Somervell LJ were of the views that a contemnor will not be heard until he has purged his contempt subject to certain exceptions, Denning LJ preferred a flexible approach to deal with the matter at hand. At p 575 of the report, Denning LJ had this to say:
Applying this principle, I am of opinion that the fact that a party to a cause has disobeyed an order of the court is not of itself a bar to his being heard, but if his disobedience is such that, so long as it continues, it impedes the course of justice in the cause, by making it more difficult for the court to ascertain the truth or to enforce the orders which it may make, then the court may in its discretion refuse to hear him until the impediment is removed or good reason is shown why it should not be removed.

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And according to Denning LJ, at p 575 of the report, the case at hand was a 'good example of a case where the disobedience of the party impedes the course of justice. So long as this boy remains in Australia, it is impossible for this court to enforce its orders in respect of him.' 2 MLJ 61 at 66 [5] For my part, the antiquated general rule will not bar nor prevent a contemnor to clear the very contempt which he is said to have committed. All these are said and have been said in the context of encl 46. [6] In regard to encl 14, I have this, by way of a prelude, to say. [7] Seeking an Anton Piller order was just like saying that the defendants were not to be trusted and that they were capable of destroying the evidence and thereby depriving the plaintiff of its legal right at law (per Sir Peter Pain in O'Regan & Ors v Lambic Productions Ltd (1989) New Law Journal, Vol 139, at p 1378). No wonder the defendants filed encl 14 to rid themselves of that 'plague'. Many Judges say that an Anton Piller order is very draconian and it carries with it a very drastic effect when it is executed. It is for these salient reasons that an Anton Piller order should only be granted in very exceptional cases (Thermax Ltd v Schott Industrial Glass Ltd [1981] FSR 289; and Columbia Picture Industries Inc & Ors v Robinson & Ors [1987] Ch 38; [1986] 3 All ER 338). [8] I will now examine these two enclosures, one after the other. ENCLOSURE 46 [9] The plaintiff sought by way of this enclosure to commit Mr Koay Chee Hong, the director of the second defendant, for contempt. Only two specific charges were preferred against Mr Koay Chee Hong ('Koay') in encl 46. The first charge can be seen in para 1.1 of encl 46 and the second charge is set out in para 1.2 thereto. I shall confine myself to these two charges in this judgment. [10] In the first charge, it was alleged that Koay had 'deliberately and/or intentionally and/or wilfully refused to allow the named persons to carry out the execution of the Anton Piller order on 23 September 2002 at or about 5pm at the first floor of the premises.' The premises would be located at the Pekeliling Business Centre, Suite 18-2, Persiaran 65C, off Jalan Pahang Barat, 53000 Kuala Lumpur. Having read para 1.1 of the Anton Piller order, it specifically limits the execution at the premises located at Suite 18-2 which is on the second floor. Thus, execution on the first floor would be in violation of the Anton Piller order. In law, Koay was not obliged to permit a search to be made on the first floor. Strictly speaking, Koay did not violate the Anton Piller order. Moreover, the plaintiff has not discharged its burden of proving beyond reasonable doubt that Koay had 'deliberately and/or intentionally and/or wilfully' refused to allow the execution of the Anton Piller order. In his affidavit that was affirmed on 17 March 2003 as seen in encl 53, Koay has specifically stated that he acted as he did upon the advice of his solicitors. This is clearly borne out by the 'Report of Mr Ranjit Singh, supervising solicitor appointed by the court order dated 20 September 2002 '. This report is annexed to the affidavit of David Ng Hock Heng affirmed on 30 September 2002 as seen in encl 10. At para 12 of Mr Ranjit Singh's report, there was reference to the explanation given by one Mr Goh, a solicitor, on behalf of Koay as to why Koay was unable to comply with the Anton Piller order. One very compelling reason was this. That the 'documents are 2 MLJ 61 at 67 protected under the Official Secrets Act' and another equally compelling reason was that the Anton Piller order was not specific and in fact vague and ambiguous. [11] Paragraph 2 of the Anton Piller order carries the sub-heading 'Restrictions on the service and carrying out of para 1 of this order' and in particular to sub-para 2.1.6 which reads as follows:
The premises must not be searched, and items must not be removed from them except in the presence of the defendants, Ng Hock Chong's and Selamat Ekuiti Sdn Bhd's agents, employees or servants or otherwise.

[12] There was no denial by the plaintiff that the first defendant by the name of Ng Hock Chong was not at

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the premises, at all material times, at the time of the execution of the Anton Piller order. In the absence of the first defendant and by the clear terms of the Anton Piller order that 'the premises must not be searched and items must not be removed from them', Koay who was a director of the second defendant was 'not an agent or employee or servant' of the first defendant. The Anton Piller order is even more explicit in para 7(a) thereof and it states as follows:
A defendant who is an individual who is ordered to do something must do it himself or in any other way. He must not do it through others acting on his behalf or on his instructions or with his encouragement.

[13] Then there is para 11.2(a) of the Anton Piller order which states that 'references to 'the defendant' mean 'both or all of them'.' That being the case, it would be correct to say that the plaintiff could not validly execute the Anton Piller order in the absence of one of the defendants. Compliance with the Anton Piller order must be done jointly by the defendants and not severally in view of the specific terms of the said order. [14] In regard to the second charge, it is appropriate to reproduce para 1.2 of encl 46 which states as follows:
|PO deliberately and/or intentionally and/or wilfully misrepresented to the supervising solicitor and the plaintiff's solicitors that the premises was not Selamat Ekuiti premises on 23 September 2000 at or about 2.10pm at the second floor of the premises.

[15] And the above allegation, even if true, would not amount to a contempt of the Anton Piller order because as at 2.10pm, the Anton Piller order had not yet been served on Koay. It was only served at 2.15pm. This fact can be seen in paras 5 and 6 of Mr. Ranjit Singh's statement marked as exh 'NHH-3' annexed to the affidavit in encl 12. [16] In his affidavit in encl 53, Koay has explained that Mr Ranjit Singh had not introduced himself at 2.10pm on the second floor but only introduced himself at about 2.15pm at the first floor at the time of the service of the Anton Piller order (see the averments at para 11 of encl 53). In the circumstances, Koay's alleged reactions 2 MLJ 61 at 68 at 2.10pm were perfectly understandable and in this connection Koay is corroborated by Mr Ranjit Singh in para 12 (vii) of his statement marked as exh 'NHH-3' annexed to the affidavit in encl 10. [17] The alleged removal of the signboard of the second defendant by an unidentified person can hardly be blamed on Koay. I must categorically say that in a charge for contempt there is no room for implication. Only the relevant facts must be specifically proved. Be that as it may, it must be emphasised that Koay has denied the allegation as found in para 15 of the affidavit in encl 53. Of significance would be this salient fact. That no one, including the supervising solicitor, saw it fit to obtain an explanation from Koay in regard to the missing signboard (see para 10 of Mr. Ranjit Singh's report marked as exh 'NHH-3' annexed to the affidavit in encl 10). It was certainly food for thought. In the premises, the whole aspect of the matter was nothing more than mere surmises and pure conjectures and the conclusion was rather obvious. That Koay was not in contempt of court. [18] I have in Asia Pacific Parcel Tankers Ptd Ltd v The Owners of the Ship or Vessel 'Normar Splendour' [1999] 6 MLJ 652 held that civil contempt just like criminal contempt must be proved beyond reasonable doubt. In Mah Siew Keong v Bayu Gamitan Sdn Bhd and other appeals) [2002] 2 MLJ 107, Gopal Sri Ram JCA delivering the judgment of the Court of Appeal aptly said at p 109 of the report:
In our view, if, as here, an ex parte injunction is drafted in wide and ambiguous terms, it is, difficult, if not impossible, to identify particular acts of contempt.

[19] And further down the same page, his Lordship quoted with approval a passage from Arlidge, Eady &

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Smith on Contempt (2nd Ed) para 12-43, p 746, which reads as follows:
An order or undertaking will not be enforced by committal if its terms are ambiguous, the rule being analogous to that which governs the interpretation of penal statutes. It is to the terms of the order itself that one must look in order to define the obligations imposed.

[20] Approaching encl 46 with care and circumspection, and after applying the principles of law as enunciated in Asia Pacific Parcel Tankers Ptd Ltd v The Owners of the Ship or Vessel 'Normar Splendour', it was clear beyond peradventure that the plaintiff has failed to establish the essential ingredients of the two charges levelled against Koay, in encl 46, beyond reasonable doubt. Furthermore, the list of items as set out in Schedule 1 of the Anton Piller order which were sought to be searched, inspected, photographed and delivered for safe keeping of the plaintiff's solicitors were so unquestionably vague and/or ambiguous in description as to make it practically impossible for Koay to comply with the said order (see Mah Siew Keong v Bayu Gamitan Sdn Bhd and other appeals). To say the least, the Anton Piller order was in the nature of a fishing expedition. [21] The learned counsel for Koay took an unprecedented step, a measure calculated to overcome the rigours of encl 46. He advised Koay to take the stand and to apologise to this court for showing disrespect to this court. The learned counsel 2 MLJ 61 at 69 thought that Koay was in contempt and the best legal recourse would be to apologise to this court under oath. I have demonstrated that Koay was not in contempt and I have given the reasons for arriving at that decision. Having read the cause papers, I knew that Koay was not in contempt. But, in the event, I was wrong and the Court of Appeal felt otherwise then there was nothing on record to show that Koay had apologised to this court. What should I do when a party wishes to apologise thinking that he has been in contempt and for fear of being imprisoned he now admits that he is in contempt and wants to apologise profusely and throw himself to the mercy of this court? As a judge, I have to be magnanimous. I have to be kind and forgiving. I gave and I did give Koay the chance to apologise on the footing that Koay was in contempt bearing in mind that the Court of Appeal may not agree with my decision that Koay was not in contempt at all. Surely the three judges of the Court of Appeal sitting in an appellate jurisdiction would be able to see things in a different light different from my way of thinking and rationalising. [22] Koay took the stand and apologised profusely. If Koay was in contempt and I must hold that if he was really in contempt of the Anton Piller order dated 20 September 2002 he had by profusely apologising to this court purged his contempt. I accepted his apology and I admonished and discharged him accordingly. [23] For all these reasons, I dismissed encl 46 forthwith. ENCLOSURE 14 [24] On 20 September 2002, the plaintiff obtained an ex parte Anton Piller order. Armed with that order, the plaintiff entered the defendant's premises in order to execute the Anton Piller order. This was on 23 September 2002, but unfortunately the plaintiff failed to do so. On 8 October 2002, an inter parte hearing of the Anton Piller order was heard. Meanwhile, the defendants filed their summons in chambers in encl 14 in order to set aside the Anton Piller order. [25] It is the norm to apply for an Anton Piller order in order to enter and search and seize for articles or documents stored or kept in certain premises. An element of surprise would be the key factor. Of course, an Anton Piller order is a mandatory order of the court and it may be granted ex parte in favour of the plaintiff wherein the plaintiff would be authorised to enter the premises of the defendant in order to search for articles and documents kept in the said premises and to inspect them physically and even remove them for safe-keeping. It is to prevent the destruction or concealment of materials which may be relevant in any pending or intended litigation that an Anton Piller order is usually obtained. The courts have always been magnanimous in granting Anton Piller orders. Indeed, such an order may even be granted at any stage of an action. It is very flexible and it may even be granted before the issuance of the writ of summons and in

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some cases it may even be granted after judgment and solely for the purpose of aiding execution as seen in the case of Distributori Automatici Italia SpA v Holford General Trading Co Ltd [1983] 3 All ER 750. An Anton Piller order is a very effective armoury for legal practitioners. 2 MLJ 61 at 70 It extends to all kinds of cases and it will scare the daylights of those recalcitrant defendants (Yousif v Salama [1980] 3 All ER 405; and Lian Keow Sdn Bhd v C Paramjothy & Anor [1982] 1 MLJ 217). [26] As the name implies, an Anton Piller order derives its name from the case of Anton Piller KG v Manufacturing Processes Ltd & Ors [1976] 1 All ER 779, a decision of the Court of Appeal. It has even received the approval of the House of Lords in the case of Rank Film Distributors Ltd & Ors v Video Information Centre & Ors [1981] 2 All ER 76. [27] In Malaysia, the courts too have granted Anton Piller orders. It started with the case of Lian Keow Sdn Bhd v C Paramjothy & Anor and it is now a common feature in our courts. [28] The plaintiff must show, in order to obtain an Anton Piller order, that there is a 'very strong prima facie case against the defendant.' To do this, the plaintiff must show that there is a valid cause of action and that judgment would be granted in favour of the plaintiff. [29] That would be the brief legal discourse on the law of Anton Piller. I will now proceed to, briefly, narrate the facts. [30] The plaintiff was incorporated on 14 January 1983 to carry on business as a dealer, supplier and technical consultant of scientific and educational equipment and apparatus imported from the United Kingdom, Italy, Germany and all other countries in the fields of electronic, electrical, mechanical, chemical, civil and food technology engineering for the universities, polytechnics and technical colleges. In addition to that, the plaintiff was also to supply, deliver, install and commission scientific and educational equipment and apparatus to the various Ministries, universities, polytechnics and all government and private colleges. Seen in that context, the plaintiff certainly had their hands full. At all material times, the plaintiff was the sole and exclusive agent in Malaysia appointed by the principals from overseas. [31] The first defendant by the name of Ng Hock Chong is the younger brother of David Ng Hock Heng. The latter is the managing director of the plaintiff. In 1992, the first defendant was employed by the plaintiff as a manager. The first defendant was entrusted by the plaintiff to fully take charge of the plaintiff's operational and financial matters as well as the day-to-day operations of the plaintiff. During the employment of the first defendant with the plaintiff, the latter relied entirely on the first defendant to deal with the principals who were overseas and the first defendant had to prepare and submit tender documents for the projects of the Ministries, universities, polytechnics and all other government and private colleges. The first defendant also took charge of marketing and other related matters. [32] The plaintiff alleged several grounds of cause of action against the first defendant and they may be stated as follows: 2 MLJ 61 at 71 (i) (ii) (iii) (iv) breach of duty of good faith and fidelity; breach of duty as long as the contract of employment subsisted not to misuse any information confidential to the plaintiff or to disclose such information to any third party; breach of duty following the termination of the contract of employment not to use or disclose any trade secrets or other highly confidential information of the plaintiff; and breach of a duty to act honestly.

[33] According to the plaintiff, the confidential information relevant to this action would include all documents and records pertaining to the tender strategy, the principals' price list of the scientific and educational equipment and apparatus, numerous private and confidential documents and computer data relating to various projects of the Ministry of Education, Ministry of Labour, Ministry of Defence, Ministry of Youth and Sports, all UITMs, University Technology Petronas, Polytechnics at Tanjung Malim and Kulim, other

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universities and colleges. [34] It was said that from April 2002 to July 2002, the first defendant and three other employees resigned. It was said that sometime in March 2002, the first defendant and the second defendant unlawfully conspired with the sole and predominant purpose to injure the plaintiff by unlawful means in that: (a) (b) (c) the first defendant whilst still an employee of the plaintiff had on 1 March 2002 joined the second defendant as a director; on dates presently unknown to the plaintiff (prior to the resignation of the first defendant), the first defendant had approached other employees of the plaintiff to leave the employment of the plaintiff and join the new business, namely the second defendant; on dates presently unknown to the plaintiff (prior to the resignation of the first defendant), the first defendant had removed or caused the confidential information to be removed from the plaintiff's office and still are making use of the same for his own purposes and for the purposes of the second defendant; the first defendant in breach of the employment contract had resigned on 30 June 2002 without giving sufficient notice; on dates presently unknown to the plaintiff (prior to the resignation of the first defendant), the first defendant had wrongfully procured and induced the employees of the plaintiff to leave the employment with the plaintiff and to enter the employment of the second defendant; the defendants wrongfully procured the termination of the sole and exclusive agency contract between the plaintiff and their suppliers, namely, Feedback, Armfield and Denford by inducing them to terminate the sole and exclusive agency contract with the plaintiff to supply the scientific and educational equipment and apparatus; 2 MLJ 61 at 72 on diverse dates from early 2002 till to date, the defendants have falsely and maliciously represented to the suppliers that the second defendant is a more competent company to undertake the sole and exclusive agency; and on diverse dates from early 2002 till to date, the defendants have represented to the customers that the second defendant is the agent for Armfield, Feedback, PA Hilton, Denford and Didacta Italia.

(d) (e) (f)

(g) (h)

[35] All these, according to the plaintiff, constituted the alleged conspiracy which the first defendant and the second defendant were said to have conspired to injure the plaintiff. [36] Now, the plaintiff had sought by way of an ex parte summons in chambers in encl 3 supported by an affidavit affirmed by David Ng Hock Heng on 13 September 2002 as reflected in encl 4 and successfully obtained an ex parte Anton Piller order on 20 September 2002. In obtaining the ex parte Anton Piller order, the plaintiff made the following allegations: (1) (2) (3) (4) (5) (6) that the first defendant had made use of purportedly confidential information from documents belonging to the company without its consent; that the first defendant had stolen or otherwise committed theft of such documents including the 'price lists' and 'tender strategy' at the plaintiff's premises and had removed, erased and taken them away from there to the office of the second defendant; that without those documents, the plaintiff could not operate its business; that as a result of which the plaintiff's business came to a standstill and practically crippled; that the confidential documents allegedly kept at the second defendant's premises were required by the plaintiff to prove the plaintiff's claim; and that the ex parte application was filed in order to catch the defendants by surprise.

[37] The ex parte Anton Piller order permitted an entry of the supervising solicitor by the name of Mr Ranjit Singh s/o Harbinder Singh accompanied by three advocates and solicitors from Messrs Isa, Ling & Mok ('the plaintiff's solicitors') together with six other persons who were the agents/representatives of the plaintiff and two other police personnel at the premises known as Pekeliling Business Centre, Suite 18-2, Persiaran 65C, off Jalan Pahang Barat, 53000 Kuala Lumpur in order to search, inspect, photograph or photocopy and

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deliver into safe keeping of the plaintiff's solicitors all documents and articles which are listed in the list of items annexed as Sch 1. [38] By way of encl 14, the defendants sought to set aside the ex parte Anton Piller order obtained by the plaintiff and I must now consider encl 14 under several sub-heads: 2 MLJ 61 at 73 (A) Non-compliance with O 29 r 1(2A) of the Rules of the High Court 1980 ('the RHC') [39] Order 29 r 1(2A) of the RHC states as follows:
(2A) The affidavit in support shall contain a clear and concise statement: (a) (b) (c) (d) (e) (f) (g) of the facts giving rise to the claim against the defendant in the proceedings; of the facts giving rise to the claim for the interlocutory relief; of the facts relied on as justifying application ex parte, including details of any notice given to the defendant or, if none has been given, the reason for giving none; of any answer asserted by the defendant (or which he is thought likely to assert) either to the claim in the action or to the claim for interlocutory relief; of any facts known to the applicant which might lead the court not to grant relief ex parte; of whether any previous similar ex parte application has been made to any other judge, and if so, the order made in that previous application; and of the precise relief sought.

[40] Clement Skinner J in UMAS Sendirian Berhad v RHB Bank Berhad & Anor [2001] 1 AMR 1024 emphasised the need to comply strictly with r 1(2A) of O 29 of the RHC and this was what his Lordship said (see p 1042 of the report):
The consequence of the plaintiff's failure to comply with r 1(2A) of O 29 is that the injunction having being obtained in breach of r 1(2A) which requires strict compliance with its terms, it must be discharged, to do otherwise would defeat the policy behind the introduction of r 1(2A). To this end I would refer to the clear direction of the Court of Appeal to High Court judges in this particular regard in the case of Motor Sports International Ltd (servants or agents at Federal Territory of Labuan) & Ors v Delcont (M) Sdn Bhd [1996] 2 MLJ 605. Although that was a case involving the grant of a Mareva injunction on an ex parte summons, I nevertheless regard what was stated there as applying to all injunctions granted on an ex parte basis and binding on me. This is what his Lordship Gopal Sri Ram JCA speaking for the Court of Appeal said at p 611: The provisions of O 29 r 1(2A) were introduced by amendment in order to ensure that ex parte injunctions of any sort were not granted willy-nilly, but only in cases where they were truly called for. In order to ensure that the policy behind the introduction of r 1(2A) is not defeated, High Courts must demand strict compliance with its terms. More so, when the relief applied for is in the nature of a Mareva or an Anton Piller type of injunction because of the incalculable harm and damage that may be caused to a defendant by the grant of either of these orders. (Emphasis added.) For the reasons given above, I order that the injunction granted on 2 May 2000 be discharged with costs to the first and second defendants in any event.

[41] The duty of full and frank disclosure on the part of the plaintiff made it imperative that there would not be any misleading averments made in the course of obtaining the Anton Piller order on 20 September 2002. Was there any failure on the part of the plaintiff to make a full and frank disclosure when applying for the Anton Piller order on 20 September 2002? I would answer this question in the positive. 2 MLJ 61 at 74 I must categorically say that the plaintiff failed to address the court on those matters specifically required under the provisions of O 29 r 1(2A) of the RHC by suppressing material facts known to the plaintiff which might lead the court not to grant the Anton Piller order. The material facts that were suppressed may be stated as follows:

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(1) (2)

(3)

that David Ng Hock Heng knew but refused to reveal to the court that there were other third parties that were sharing the premises at Suite 18-2, Persiaran 65C, off Jalan Pahang Barat, 53300 Kuala Lumpur; that David Ng Hock Heng knew but refused to tell the court that third parties were also involved in the same business and that they were competing with each other and against the plaintiff and that the scope of List 1 - pertaining to the list of documents annexed to the Anton Piller order, also included documents from the third parties; and that David Ng Hock Heng knew but refused to reveal to the court that the rights of third parties to protect their own properties might be infringed if the Anton Piller order was executed.

[42] It must be emphasised that the Anton Piller order is just like a search warrant which allows entry and search on the premises identified. It is a very harsh remedy. It puts fright to those affected. It gives the power to the plaintiff to force the defendant, by way of an Anton Piller order, to allow the plaintiff to enter into the defendant's premises in order to inspect and remove documents and materials which are relevant to the litigation. In EMI Ltd v Pandit [1975] 1 All ER 418, the English court allowed an ex parte application for an Anton Piller order without notice to the defendant in 'exceptional and emergency cases.' Such being the nature of an Anton Piller order, there is a strict duty imposed on the plaintiff to make a full and frank disclosure. If the plaintiff should err, at all, in obtaining the ex parte Anton Piller order, it should, according to Scott J in Columbia Picture Industries Inc v Robinson [1986] 3 All ER 338, be on the side of excessive disclosure. Here, there was not only an inadequate disclosure but there were also misrepresentations which ultimately led the court to grant the Anton Piller order on an ex parte basis. On perusal of the affidavits there were contradictory versions between the documents in two different affidavits. Allow me to elaborate: (1) In regard to the apparent loss of employment contract which does not exist, David Ng Hock Heng had deposed of the existence of the employment contract in the affidavit in encl 4 in exh 'DN-3' yet he also deposed at para 7 of the affidavit in encl 28 that the first defendant had stolen the employment card. In regard to the first defendant's title in the plaintiff's company and the first defendant's right to obtain the commission, at paras 8 to 11 of the affidavit in encl 28 David Ng Hock Heng twisted the facts by stating that the first defendant was only the manager and has no right to secure and obtain the commission yet at para 14 (c) of the affidavit in encl 4 in exh 'DN-3' David Ng Hock Heng specified the first defendant's commission structure as the sales manager and in exh 'NHH-3' of encl 28 it showed the plaintiff's own calculation of the commission payable to the first defendant. 2 MLJ 61 at 75 In regard to the function of the first defendant, para 46 of the affidavit in encl 28 and exh 'NHH-21' dated 21 October 2002 categorically stated that the first defendant was merely doing 'follow-up' action and it was not consistent with David Ng Hock Heng's past averments at para 12 of the affidavit in encl 4 and at para 56 of the affidavit in encl 28 which stated that the first defendant was merely exercising full control of the plaintiff's internal operations and having access to the documents. In regard to the decline of the plaintiff's business which were apparently caused by stolen and misplaced documents attributed by the first defendant, it was averred to that effect at para 26 of the affidavit in encl 4 which led to the resignation of the first defendant and all these could not have happened if not for David Ng Hock Heng or his children's failure to be actively involved in the plaintiff's business while the first defendant was in the employment of the plaintiff. In regard to the plaintiff's financial position, paras 79 to 81 of the affidavit in encl 28 contradicted para 26 of the affidavit in encl 4 which stated that the plaintiff did not have the financial ability to bear the damages as a result of the abuse of the court process in the course of the application for an Anton Piller order. In regard to the business relationship between the plaintiff and Interpac, the plaintiff had denied any knowledge and involvement in the IKBN project with Interpac in para 40 (c) of the affidavit in encl 4 and this must be viewed in the context of the contradicting stories as seen in paras 43 (a), (b), 67, 68 and 69 of the affidavit in encl 28. Initially, David Ng Hock Heng in para 40(c) of the affidavit in encl 4 stated that he has never dealt with Interpac for the IKBN project and that the first defendant had conspired without his knowledge with the plaintiff to procure the profit of

(2)

(3)

(4)

(5)

(6)

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(7)

(8)

RM200m for the first defendant. Later, David Ng Hock Heng through an affidavit in encl 28 particularised in detail the joint venture between Interpac and himself in regard to the IKBN project. In regard to the involvement between David Ng Hock Heng and Hi-Tech in the IKBN project, it must be emphasised that Hi-Tech was under the control of David Ng Hock Heng, at all material times, and it was established for the purpose of obtaining the mechanical package under the IKBN project and that the preparation of the tender documents were prepared by the plaintiff's employees. It is ideal to mention that paras 63(1) and 63(m) of the affidavit in encl 28 would show David Ng Hock Heng's involvement in the administration of Hi-Tech. In regard to the background of the transaction of Prinsip Cergas (M) Sdn Bhd for the sum of RM474,230, David Ng Hock Heng had alleged misrepresentation by the first defendant to the effect that the first defendant would be able to secure the IKBN project but he contradicted this averment at paras 43, 43(d), 66 and 67 of the affidavit in encl 28.

[43] Now, if the duty of full and frank disclosure was not observed by the plaintiff and that there were misleading averments advanced by the plaintiff, the court is 2 MLJ 61 at 76 entitled to discharge the Anton Piller order. This would even be so if, after a full enquiry, the view taken was that it was just and convenient that the Anton Piller order would probably have been made even if there have been a full disclosure. By way of an analogy, Bingham J in Siporex Trade SA v Comdel Commodities Ltd [1986] 136 LJ 538 at p 539 discharged a Mareva injunction for failure to make a full and fair disclosure. It must not be forgotten that all the facts must be laid before the court and nothing must be suppressed (R v Kensington Income Tax Commissioners [1917] 1 KB 486) otherwise the order of an injunction may be set aside without regard to the merits (Boyce v Gill (1891) 64 LJ 824). It is an established law that those who come 'asking ex parte for injunctions must proceed with the highest good faith, and keep back no material facts' (Schmitten v Faules [1893] WN 6 4). According to the case of Daglish v Jarvie (1851) 20 LJ Ch 475, the party applying for an ex parte injunction is bound to state not only the facts that he considers material but also all the facts within his knowledge that are material. So, if it is shown that a plaintiff had innocently omitted to state circumstances which turn out to have material bearing upon his rights the injunction should be dissolved. Zakaria Yatim J, (as he then was) in PMK Rajah v Worldwide Commodities Sdn Bhd & Ors [1985] 1 MLJ 86, dissolved the ex parte Anton Piller order on the ground that the plaintiff there had either misrepresented or suppressed the material facts. In adjudicating encl 14, it must be highlighted that the non-disclosure and suppression of material facts and misleading facts asserted by the plaintiff in obtaining the Anton Piller order constituted a serious breach which, had it been disclosed or had the facts been properly presented, the court would not have granted the Anton Piller order. It was urged upon me not to lend a hand to the plaintiff who sought equity with unclean hands and, consequently, it was pointed out that I ought to discharge the Anton Piller order forthwith. I willingly acceded. (B) Want of disclosure and the privilege against self incrimination rule [44] The plaintiff in obtaining the Anton Piller order had not disclosed to this court matters which were self-incriminating in nature and which were in breach of s 123 of the Evidence Act 1950 particularly in relation to the production of the documents sought for in the Anton Piller order 'requesting all information, documents, records or otherwise pertaining to the tender strategy for the various projects of the Ministry of Education, Ministry of Labour, Ministry of Defence, Ministry of Youth and Sports|PO..' [45] In an application for an Anton Piller order, the applicant is under a duty to bring to the notice of the court any matters affecting the property of the order which come to light before the order is executed. This simple proposition of the law was adopted by Sir Peter Pain, sitting as a High Court judge, in the case of O'Regan & Ors v Lambic Productions Ltd. There his Lordship applied the views of Saville J in Commercial Bank of the Near East Plc v P [1989] NLJ 645 and proceeded to discharge the Anton Piller order for want of disclosure. Sir Peter Pain aptly said in O-Regan (see p 1379 of the report):
In a sense, it does not make much difference whether or not I discharge the Anton Piller order because it has already been executed, but I observe that in the judgment of Hoffman J in Lock International Plc v Beswick [1959] NLJ 644, the judge said that the Anton Piller

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2 MLJ 61 at 77 order there was inappropriate and expressed a strong view that he would discharge it in that case. I am happy to follow his judgment in this case in view of the affidavit filed at the last minute by the defendant which indicates that the defendant is obviously having difficulties in carrying on its business in the film-making trade. An Anton Piller order plainly carries the suggestion that a person is not to be trusted and is likely to destroy evidence. This is a very serious thing. People who owe a defendant money, or may enter into further obligations with him, are reluctant to carry on business with him in the ordinary way while this is hanging over him. Consequently, I discharge the Anton Piller order and I believe it to be fair to the defendant to express the view that if the true facts had been known the order should never have been made.

[46] At the local scene, Zakaria Yatim J., (as he then was) in PMK Rajah v Worldwide Commodities Sdn Bhd & Ors referred to the English Court of Appeal case ofRank Film Distributors Ltd & Ors v Video Information Centre & Ors [1980] 2 All ER 273 (CA); [1981] 2 All ER 76 (HL) and upheld the privilege against self-incrimination in the production of trading statement without disclosing the particulars of other clients which were confidential in nature and exposing the defendants to the offence of 'bucketing' under ss 56(2) and 59(2) of the Commodities Trading Act 1980. (C) Non-justification of granting an Anton Piller order [47] I have, in the early part of this judgment, referred to the case of Anton Piller KG v Manufacturing Processes Ltd & Ors from which the name of the order was derived and there Lord Denning MR in his judgment said at p 783 of the report:
Accepting such to be the case, the question is in what circumstances ought such an order be made. If the defendant is given notice beforehand and is able to argue the pros and cons, it is warranted by that case in the House of Lords and by RSC O 29 r 2(1) and (5). But it is a far stronger thing to make such an order ex parte without giving him notice. This is not covered by the rules of court and must be based on the inherent jurisdiction of the court. There are one or two old precedents which give some colour for it, Hennessey v Bohmann, Osborne & Co (1877) WN 14, and Morris v Howell (1888) 22 LRIr 77, an Irish case. But they do not go very far. So it falls to us to consider in on principle. It seems to me that such an order can be made by a judge ex parte, but it should only be made where it is essential that the plaintiff should have inspection so that justice can be done between the parties; and when, if the defendant were forewarned, there is a grave danger that vital evidence will be destroyed, that papers will be burnt or lost or hidden, or taken beyond the jurisdiction, and so the ends of justice be defeated: and when the inspection would do no real harm to the defendant or his case.

[48] Writing a separate judgment in the same case, Ormrod LJ said at p 784 of the report:
I agree with all that Lord Denning MR has said. The proposed order is at the extremity of this court's powers. Such orders, therefore, will rarely be made, and only when there is no alternative way of ensuring that justice is done to the plaintiff. There are three essential pre-conditions for the making of such an order, in my judgment. First, there must be an extremely strong prima facie case. Secondly, the damage, potential or actual, must be very serious for the plaintiff. Thirdly, there must be clear evidence that the defendants have in 2 MLJ 61 at 78 their possession incriminating documents or things, and that there is a real possibility that they may destroy such material before any application inter partes can be made.

[49] There is no denial that the phrase 'a real possibility' that was employed by Ormrod LJ in Anton Piller KG v Manufacturing Processes Ltd & Ors has given rise to some confusion but fortunately it has been clarified by Dillon LJ in Booker McConnell plc v Plascow & Ors [1985] RPC 425, and at p 441, his Lordship had this to say:
The phrase 'a real possibility' is to be contrasted with the extravagant fears which seem to afflict all plaintiffs who have complaints of breach of confidence, breach of copyright or passing off. Where the production and delivery up of documents is in question, the courts have always proceeded, justifiably, on the basis that the overwhelming majority of people in this country will comply with the court's order, and that defendants will therefore comply with orders to, for example, produce and deliver up documents without it being necessary to empower the plaintiff's solicitors to search the defendant's premises.

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[50] I have deliberated on the law and the facts surrounding the whole case and I must say that there was no justification for the plaintiff to seek an Anton Piller order. Sad to say that the plaintiff had offered no evidence to show that the defendants would or had the intention of destroying the essential evidence. In the statement of claim, the plaintiff listed the following irrelevant issues to persuade this court to grant the Anton Piller order: (i) (ii) (iii) (iv) (v) whether or not the first defendant did, as alleged, conspire with the second defendant to entice away the company's ex-employees in the persons of Christynn Ding Li Fong, Cindy Ee Geak Chin and Jeffrey Ong Hock Leng?; whether or not the first defendant did, as alleged, induce the principals to terminate the agency arrangement with the plaintiff?; whether or not the first defendant did, as alleged, steal the plaintiff's money by claiming commission in excess of the amount otherwise due to the first defendant while being employed as a sales manager?; whether or not the first defendant did represent Interpac as the technical consultant on 4 July 2002 in the IKBN project related package of work?; and whether or not the first defendant did become a director in the second defendant's company on 1 March 2002 while the first defendant was still an employee of the plaintiff?

[51] The stand of the defendants were that the plaintiff had deliberately put in the irrelevant issues with the invented tale of the purported physical theft of and misuse of information in regard to the documents in order to influence the court in granting the ex parte Anton Piller order. It was also the stand of the defendants that the plaintiff could have sought the documents and information from the principals in order to secure the 'price list' or the 'confidential information' which were supplied by the plaintiff in the first place. Perhaps what was said by Brightman LJ in Yousif v Salama [1980] 1 WLR 1540, at p 1543, should be reproduced as they were quite apt to the occasion at hand. This was what his Lordship said:
2 MLJ 61 at 79 I regard that [i.e. the granting an Anton Piller order] as a very serious invasion of the rights of the defendants. Of course there is precedent for doing it. It is in the Anton Piller line of cases. The essential feature of those cases, as I understand them, is that there is a very clear prima facie case leading the court to fear that the defendant will conceal or destroy essential evidence in the grossest possible contempt of the court and -- and this is an important second limb -- that should he do so the whole processes of justice will be frustrated because the plaintiff will be left without any evidence to enable him to put forward his claim. In that limited class of case 1, for my part, think that the Anton Piller order is absolutely right. No court can stand by and see the processes of justice totally frustrated by a defendant in contempt of its order. But I cannot find anything in this case which brings it within that category. I regard the evidence of an intention to destroy the documentation as clumsy in the extreme. It is based upon an allegation of forgery in the indorsement of a cheque. This has nothing whatever to do with the destruction of documents which the plaintiff says that he fears.

[52] It was submitted on behalf of the defendants that the plaintiff had influenced this court into granting the Anton Piller order on an ex parte basis for its own commercial gain without revealing that there were other third parties who have various contracts with the government agencies sharing the same premises with the second defendant. It was said that the plaintiff would abuse the Anton Piller order which it obtained by searching, inspecting and seizing the documents of a competitor. It must be borne in mind that cl 2.1.4 of the Anton Piller order permits the plaintiff to gain commercially from anything which the plaintiff might read or see notwithstanding the objection of the person who was served with the order. In fact, the Anton Piller order authorised the plaintiff to commit an illegal act with the ultimate financial gain. (D) The Anton Piller order is too wide, imprecise, vague and oppressive [53] I have read the Anton Piller order granted to the plaintiff on an ex parte basis and it was certainly too wide, imprecise, vague and oppressive in the extreme. The wordings of the Anton Piller order were worded like this: (1) Any and all information, documents, records or otherwise pertaining to the tender strategy for various projects of the Ministry of Education, Ministry of Labour, Ministry of Defence, Ministry of

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(2)

(3)

Youth and Sports, all UITMs, University Technology Petronas, Polytechnics Merlimau, Tanjung Malim and Kulim, universities, polytechnics and colleges. Any and all information, documents, records or otherwise pertaining to the Principals' (Feedback, Armfield, Didacta Italia, PA Hilton and Denford) price list of the scientific and educational equipment and apparatus for various projects of the Ministry of Education, Ministry of Labour, Ministry of Defence, Ministry of Youth and Sports, all UITMs, University Technology Petronas, Polytechnics Merlimau, Tanjung Malim and Kulim, universities, polytechnics and colleges. Any and all information, documents, records or otherwise pertaining to the private and confidential documents and records of the plaintiff. 2 MLJ 61 at 80

[54] I agree that the defendants were put in a dilemma as to what documents that were covered under the Anton Piller order. According to the case of Garden Cottage Foods Ltd v Milk Marketing Board [1984] 1 AC 130 (HL), all orders of the court should be expressed in clear and unambiguous terms especially where (as in the case of injunctions) the failure to comply will constitute contempt of court. In Attorney-General v Staffordshire County Council [1905] 1 Ch 336, at p 342; Morris v Redland Bricks Ltd [1970] AC 652, at pp 666-667; and Collins v Wayne Iron Works (1910) 76 Atl 24, at p 25, made it clear that an injunction should be framed so as to make it plain to those to whom it is directed, and to those who may be affected by it, the nature of the obligation arising from the order, so that they may know precisely what they are required to do or abstain from doing. These principles of law when applied to the facts of the present case weighed heavily in favour of the defendants. [55] I have taken an arduous route to consider encl 14. Justice must be seen to be done. Other inconsequential submissions were not considered in this judgment as they were without merits. For the reasons as adumbrated above, I granted an order in terms of encl 14 for prayers (1), (2), (3) and (4). Enclosure 46 dismissed. Enclosure 14 allowed.

Reported by Sally Kee

Malayan Law Journal Reports/2005/Volume 6/ARTHUR ANDERSON & CO v INTERFOOD SDN BHD [2005] 6 MLJ 239 - 24 January 2005 19 pages [2005] 6 MLJ 239

ARTHUR ANDERSON & CO v INTERFOOD SDN BHD

COURT OF APPEAL (PUTRAJAYA) RICHARD MALANJUM, HASHIM YUSOFF AND TENGKU BAHARUDIN SHAH JJCA CIVIL APPEALS NO B-02-633 OF 2001 AND B-02-634 OF 2001 24 January 2005 Civil Procedure --Anton Piller order -- Application to set aside -- Applicable guidelines in granting order -Whether failure to observe O 29 of Rules of the High Court 1980 -- Whether order should be set aside The respondent had applied and on 9 March 1999 was granted several interim reliefs against the appellant, mainly an Anton Piller order ('the Order'). The appellant then applied to set aside the Order while the respondent sought an order to continue to retain the documents seized pursuant to the Order. The same High Court judge who granted the Order (1) allowed the respondent's application to retain the documents; but (2) dismissed the appellant's application to set aside the Order. The appellant appealed against both orders.

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The issues were, inter alia: (1) whether the High Court judge was correct in his approach when he only dealt with the grounds as he found them in the application to set aside the order and ignoring any other grounds that could have been found in the supporting affidavit; (2) whether the High Court judge was justified in granting the Order at the ex-parte stage; and (3) whether there were guidelines applicable in Malaysia on the mandatory contents as well as in the execution of an Anton Piller order. Held, allowing both appeals: (1) The learned High Court judge had erred in that there was nothing in law to preclude him from perusing the supporting affidavit in order to consider any other grounds advanced to justify the reliefs sought for in the application. In doing what he did, the learned High Court judge went over-board on technicalities without due consideration to the salutary notion that courts exist to do justice (see para 15). Even with the absence of any Practice Direction, the application and execution of an Anton Piller order is subject to stringent requirements, guidelines and safeguards. In other words any departure would be contrary to the common law of Malaysia as such point has already been well established (see para 26). On evidence, there was a total failure by the respondent to observe the minimum requirements as to the contents and the execution of the said Order which elements the learned High Court judge failed to address. 2005 6 MLJ 239 at 240 On this ground alone that the court had no hesitation to set aside the Order (see para 29). The respondent failed to address another factor at the ex-parte stage, namely, on the serious consequence to it if its application was refused. There was nothing in the supporting affidavit or in any of the other affidavits filed on behalf of the respondent which expressed such apprehension (see para 37). The failure of the respondent for not disclosing the discovery order in an earlier suit tantamount to a failure to make a full and frank disclosure of relevant fact at the ex parte stage stage (see para 42). There were blatant failures to observe the provisions of O 29 Rules of the High Court 1980, ie (i) there was nothing stated in the supporting affidavit that the appellant was given notice of the intended application or the reason for not doing so; and (ii) there was no statement or reason as to the nature of the urgency justifying the application be made ex parte. The court, thus had no choice but to set aside the said Order (see paras 47 and 48).

(2)

(3)

(4)

(5) (6)

[Bahasa Malaysia summary Responden telah memohon dan pada 9 Mac 1999 telah diberi beberapa relif interim terhadap perayu, terutamanya satu perintah Anton Piller ('Perintah tersebut'). Perayu kemudiannya telah memohon untuk mengetepikan Perintah tersebut manakala responden pula memohon satu perintah untuk terus menyimpan dokumen-dokumen yang diambil berikutan dengan Perintah tersebut. Hakim Mahkamah Tinggi yang sama yang telah memberikan Perintah tersebut (1) membenarkan permohonan responden untuk menyimpan dokumen- dokumen; tetapi (2) menolak permohonan perayu untu mengetepikan Perintah tersebut. Perayu telah membuat rayuan terhadap kedua-dua perintah. Isu-isu adalah, inter alia: (1) sama ada hakim Mahkamah Tinggi betul dalam pendekatannya apabila beliau hanya berurusan dengan alasan-alasan yang didapatinya di dalam permohonan untuk mengetepikan perintah tersebut dan mengabaikan alasan lain yang boleh didapati di dalam afidavit sokongan; (2) sama ada mahkamah tinggi mempunyai justifikasi membenarkan Perintah tersebut di peringkat ex-parte; dan (3) sama ada terdapat garis panduan yang terpakai di Malaysia untuk kandungan mandatori dan juga pelaksanaan perintah Anton Piller. Diputuskan, membenar kedua-dua rayuan:

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(1)

(2)

(3)

(4)

(5) (6)

Hakim Mahkamah Tinggi telah tersilap kerana tiada terdapat sebarang undang-undang yang mengecualikan beliau dari membaca afidavit sokongan bagi menimbang mana-mana alasan lain yang dikemukakan 2005 6 MLJ 239 at 241 untuk memberi justifikasi bagi relif yang dipohon di dalam permohonan itu. Dengan bertindak sebagaimana yang beliau lakukan, yang arif hakim mahkamah tinggi telah terlebih pada keteknikan tanpa memberi pertimbangan yang sewajarnya kepada kewujudan mahkamah iaitu untuk memberi keadilan (lihat perenggan 15). Walaupun tiada terdapat sebarang Arahan Amalan, permohonan dan pelaksanaan perintah Anton Piller adalah tertakluk kepada keperluan- keperluan dan garis panduan yang ketat. Dalam lain perkataan, sebarang penyimpangan adalah bercanggah dengan common law di Malaysia kerana perkara ini telah lama mantap (lihat perenggan 26). Pada keterangan, terdapat kegagalan mutlak oleh responden dalam mematuhi keperluan-keperluan minimum berhubung dengan kandungan dan pelaksanaan Perintah tersebut yang mana ianya tidak diteliti oleh yang arif hakim mahkamah tinggi. Alasan ini secara sendirinya sudah cukup bagi mahkamah untuk mengetepikan Perintah tersebut (lihat perenggan 29). Responden telah gagal untuk menunjukkan faktor lain pada peringkat ex-parte, iaitu akibat yang serius jika permohonan ini ditolak. Tidak terdapat apa-apa di dalam afidavit sokongan atau di dalam mana-mana afidavit yang difailkan oleh responden yang menunjukkan kerisauan ini (lihat perenggan 37). Kegagalan responden kerana tidak memberitahu tentang perintah penzahiran dalam guaman yang terdahulu adalah merupakan satu kegagalan untuk membuat pendedahan yang penuh dan tulus berhubung fakta relevan pada peringkat ex parte (lihat perenggan 42). Terdapat kegagalan yang ketara dalam mematuhi peruntukan-peruntukan A O 29 Kaedah-Kaedah Mahkamah Tinggi, iaitu: (i) tiada pernyataan di dalam afidavit sokongan yang bahawa perayu telah memberi notis berkenaan dengan permohonan ini atau sebab-sebab tidak berbuat demikian; dan (ii) tidak terdapat pernyataan atau sebab berhubung dengan jenis kesegeraan yang memberi justifikasi permohonan ini dibuat secara ex parte. Mahkamah dengan itu tidak mempunyai pilihan lain tetapi mengetepikan Perintah tersebut (lihat perenggan 47 dan 48).]

Notes For cases on application to set aside an Anton Piller order, see 2(1) Mallal's Digest (4th Ed, 2004 Reissue) paras 554-555. Cases referred to Anton Piller KG v Manufacturing Processes Ltd 2005 6 MLJ 239 at 242 [1976] Ch 55; [1976] 1 All ER 779 (refd) Aspatra Sdn Bhd v Bank Bumiputra Malaysia Bhd & Anor [1987] 1 MLJ 97 (refd) Bakmawar Sdn Bhd v Malayan Banking Bhd [1992] 1 MLJ 67 (refd) Bank Mellat v Nikpour [1985] FSR 87 (refd) Bintulu Adhesive & Chemicals Sdn Bhd v Chuah Seah Joo Plywood (Sarawak) Sdn Bhd [2000] MLJU 711 (refd) Computerland Corp v Yew Seng Computers Pte Ltd [1991] 3 MLJ 201 (refd) Dormeuil Freres SA & Anor v Nicolian International (Textiles) Ltd [1988] 3 All ER 197; [1988] 1 WLR 1362

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(refd) Evans v Bartlam [1937] AC 473 (refd) HMO Pacific Sdn Bhd v Dr Johari b Muhamad Yusup [1997] MLJU 286 (refd) See Larut Consolidated Bhd & Anor v Khoo Ee Bee & Ors [1997] 5 MLJ 77 (refd) Lian Keow Sdn Bhd v C Paramiothi & Anor [1982] 1 MLJ 217 (refd) Makonka Electronic Sdn Bhd v Electrical Industry Workers' Union &Ors [1997] MLJU 93 (refd) Megat Naimuddin bin Dato Seri (Dr) Megat Khas v Bank Bumiputra (M) Bhd [2002] 1 MLJ 385 (refd) Motor Sports International Ltd (Servants or Agents at Federal Territory of Labuan) & Ors v Delcont (M) Sdn Bhd [1996] 2 MLJ 605 (refd) President Hotel Sdn Bhd v Dato Bandar Kuala Lumpur & Anor (75) MD 1 (refd) Ratnam v Cumarasamv & Anor [1965] 1 MLJ 228 (refd) Siporex Trade SA v Condel Commodities Ltd [1986] 2 ILR 428 (refd) Tan Guan Eng & Anor v Ng Kweng Hee & Ors [1992] 1 MLJ 487 (refd) UMW (Sarawak) Sdn Bhd v Kim Leong Timber Sdn Bhd & Ors [1989] 3 MLJ 177 (refd) Universal Thermosensors Ltd v. Hibben [1992] 1 WLR 840 (refd) Yousif v Salama [1980] 3 All ER 405 (not folld) Zainal Abidin bin Haii Abdul Rahman v Century Hotel Sdn Bhd [1982] 1 MLJ 260 (refd) Legislation referred to Rules of the High Court 1980 O 1A O 29 r 1(2A)(a), (b), (c), (d), (e), (f), (g) 2 Court of Judicature Act 1964 Appeal from Civil Suits No MT3-22-137 of 1999 and MT3-22-137 of 1999 (High Court, Shah Alam). Cecil Abraham (N Segaran with him) (Shearn Delamore & Co) for the appellant. Gideon Tan (Lee Noushi with him) (Gideon Tan Razali Zaini) for the respondent. Richard Malanjum JCA (delivering judgment of the court) INTRODUCTION 1 There were two appeals before us involving the same parties. 2 Both appeals were heard simultaneously at the request of the appellant and consented to by the respondent.

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2005 6 MLJ 239 at 243 3 The first appeal was against the decision of the learned High Court judge in allowing the application by the respondent (encl 10) to retain the documents obtained pursuant to the Order of 9 March 1999 while the second appeal was against the decision of the same learned High Court judge in dismissing with costs the application by the appellant (encl 7) to set aside the Order dated 9 March 1999 ('the said Order') made on ex-parte application by the respondent. 4 After hearing submissions of learned counsel for the parties we deferred our decisions. And on 12 February 2004 by way of oral judgment we allowed both the appeals. The respondent has applied for leave to appeal to the Federal Court. We therefore now state the reasons for our decisions. BRIEF BACKGROUND 5 On 12 February 1999 the respondent filed a suit against the appellant and one other which was not involved in these appeals, alleging negligence on the part of the appellant while acting as the auditor for the respondent in the preparation of the auditor's reports on the respondent for the financial years ending 31 May 1995, 31 May 1996 and 31 May 1997. 6 On filing the writ of summons and the statement of claim the respondent proceeded to file a summons in chambers (encl 3) praying on ex- parte basis for several interim reliefs. The application was supported by an affidavit of one Koh Kim Chui affirmed on 9 January 1999. 7 Upon hearing the ex-parte application on 9 March 1999 the learned High Court judge granted the several reliefs prayed for. In effect the main relief sought for was an Anton Piller order with consequential orders thereto. 8 On 16 March 1999 the appellant filed encl 7 praying for an order to set aside the said Order while on 17 March 1999 the respondent filed encl 10 seeking for an order that it could continue to retain the documents seized pursuant to the said Order. 9 Both applications were heard on 23 March 1999 by the same learned High Court judge who granted the said Order. And after hearing the parties he gave his judgment on 15 June 2001 in favour of the respondent herein. 10 Dissatisfied with the said judgment, the appellant appealed to this court. THE HIGH COURT JUDGMENT 11 In dismissing encl 7 and allowing encl 10 the learned High Court judge premised his judgment on the following grounds, in summary: 2005 6 MLJ 239 at 244 (i) (ii) (iii) that he focused his judgment solely on the three grounds stated in encl 7; that his decision on encl 7 would automatically answer encl 10; that the first two grounds submitted by the appellant dealt with the failure by the respondent to make a full and frank disclosure during its ex-parte application, of facts pertaining to documents seized pursuant to the said Order in relation to another suit MT3-22-1203 of 1998 (otherwise known as the Lau's suit). However, since the respondent and the plaintiff in Lau's suit were distinct and separate entities (with even the appellant admitting such position when opposing another application by the respondent) the two suits should not be taken to be interrelated. Hence there was no duty upon the respondent to disclose what transpired in Lau's suit; that there was no dispute that the appellant was in possession of the documents seized pursuant to the said Order and on the basis of paras 12 and 13 of the affidavit by Koh Kim Chui affirmed on 9 January 1999 the respondent was justifiably fearful that the appellant would alter, remove and/or destroy the documents seized; that based on the subsequent affidavits of Koh Kim Chui (encl 9) affirmed on 16 March 1999

(iv)

(v)

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(vi)

and (encl 22) affirmed on 20 April 1999 instances of alteration, tempering and doctoring of the working papers were alleged which would require further elaboration; and that based on the reasons for dismissing encl7 the counter- application by the respondent (encl10) would have to be allowed.

THE APPEALS 12 In our oral judgment we expressed briefly our view that we were inclined to agree with the contentions of learned counsel for the appellant in that the grant of the said Order at the ex-parte stage, the contents of the said Order as well as its execution were unsatisfactory in that there were substantive and procedural non-compliance by the respondent with the guidelines and rules applicable whether statutory or under common law. 13 And in determining the appeals before us we considered the arguments marshalled by learned counsel for the respective parties. The points raised may be categorised in two broad issues, namely, (i) (ii) the nature of the Order executed; and whether the learned High Court judge was justified in granting the said Order at the ex-parte stage bearing in mind the 2005 6 MLJ 239 at 245 preconditions required and the rules to be complied with, to wit, the substantive and procedural requirements. Quite pertinent to this issue is whether there are guidelines applicable in Malaysia on the mandatory contents as well as in the execution of an Anton Piller order.

14 However, before embarking on the substantive complaints of the appellant, we should briefly deal with the issue of whether the learned High Court judge was correct in his approach when he only dealt with the grounds as he found them in encl 7 and preferring to ignore any other grounds that could have been found in the supporting affidavit. 15 With respect, we are of the view that the learned High Court judge had erred. There is nothing in law to preclude him from perusing the supporting affidavit in order to consider any other grounds advanced to justify the reliefs sought for in the application. In doing what he did, the learned High Court judge went over-board on technicalities without due consideration to the salutary notion that courts exist to do justice. This approach has now been given statutory recognition in this country by the amendment to the Rules of the High Court 1980 (see: O 1A) following the instructive comments made by the Federal Court in Megat Naimuddin bin Dato Seri (Dr) Megat Khas v Bank Bumiputra (M) Bhd [2002] 1 MLJ 385. Further, we have no hesitation to say that UMW (Sarawak) Sdn Bhd v Kim Leong Timber Sdn Bhd & Ors [1989] 3 MLJ 177 and Bintulu Adhesive & Chemicals Sdn Bhd v Chuah Seah Joo Plywood (Sarawak) Sdn Bhd [2000] MLJU 711 were rightly decided on this point. 16 Now, on the first issue, having read the contents of the said Order we were not persuaded that it was only a mandatory injunction and that only prayer (b) of the said Order was executed. The contention was not supported by the materials before us and the events that took place subsequent to the granting of the said Order. There was no dispute that on 12 March 1999 the said Order was served and in effect executed by a representative of the respondent who came to the premises of the appellant. There was no invitation to the premises. This was not a case of where documents were given without the respondent having to come to the premises of the appellant. The respective affidavits of Koh Kim Chui affirmed on 16 March 1999 and Lee Noushi sworn to on 18 March 1999 both stated that the said Order was executed on 12 March 1999. Indeed it was only after being served with the said Order that a partner of the appellant offered to give copies of the documents being sought for. That offer was not acceptable to the representative of the respondent who was only prepared to accept the originals of those documents. In any event the giving of those documents was merely consequential to the execution of the said Order. 17 Hence we find no merit in the submission of learned counsel for the respondent on this first issue. 2005 6 MLJ 239 at 246

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18 As for the second issue, the essence of the lengthy submission of learned counsel for the appellant is that the said Order should not have been given even at the ex-parte stage as the prerequisites were not satisfied. And when given, the said Order was defective in that its contents were not in accordance with the usual format and its execution was wrong in law in that there was no observance of any of the guidelines or safeguards that should have been incorporated therein. 19 In response learned counsel for the respondent argued that although there were no guidelines stipulated in the said Order, in effect steps were taken to comply with them such as giving time to the appellant to seek legal advice and making copies of the documents seized for them to keep. The existence of any guidelines, particularly relating to the execution of an Anton Piller order, was also made an issue. 20 We do not intend to deal with each and every issue raised before us. Suffice that we only address those issues which in our view are crucial in determining these appeals. But first we need to settle the question of whether there are guidelines or safeguards applicable in Malaysia in relation to Anton Piller order, particularly on its execution. 21 An Anton Piller order is just another form of injunction albeit unique in its application. Hence, it is a discretionary relief. It assumed the name from the decision of the English Court of Appeal in Anton Piller KG v Manufacturing Processes Ltd [1976] Ch 55; [1976] 1 All ER 779 (CA). This doctrine entered into our legal corpus through para 6 of the Schedule to the Court of Judicature Act 1964 in the same way as mareva injunction did. (See: Zainal Abidin bin Haii Abdul Rahman v Century Hotel Sdn Bhd [1982] 1 MLJ 260). And when adopting and applying this doctrine our courts at all levels have consistently ensured that the elements of the doctrine as enunciated by the English courts are complied with. (See Lian Keow Sdn Bhd v C Paramiothi & Anor [1982] 1 MLJ 217. Aspatra Sdn Bhd v Bank Bumiputra Malaysia Bhd & Anor [1987] 1 MLJ 97, Makonka Electronic Sdn Bhd v Electrical Industry Workers' Union &Ors [1997] MLJU 93 (HC)). There is therefore no question of adopting the doctrine less the necessary prerequisites to be satisfied before granting such a relief. In fact, this aspect of the doctrine is not contested by the respondent. What is being questioned is the applicability in this country of the requirements or guidelines housed in the English Practice Direction 1994 pertaining to the contents and execution of an Anton Piller order. 22 It cannot be disputed that currently in Malaysia there is no Practice Direction issued ipsissima verba of the English Practice Direction 1994 or the Singapore Supreme Court Practice Direction No 1 of 1995. And such absence has triggered observations from some of our judges. (See Larut Consolidated Bhd & Anor v Khoo Ee Bee & Ors [1997] 5 MLJ 77.) Perhaps for the enhancement 2005 6 MLJ 239 at 247 of the applicability of the doctrine in this country the rules committee should seriously consider adopting the path taken by the other jurisdictions. 23 Notwithstanding, it should not be assumed that in Malaysia a successful applicant for an Anton Piller order is at liberty to formulate his own contents and mode of execution of the order granted. That is because even before the issuance of the 1994 Practice Direction the English courts had embedded guidelines and safeguards when granting such relief. For instance, in the case of Universal Thermosensors Ltd v. Hibben [1992] 1 WLR 840 at p 860 Sir Donald Nicholls VC had this to say:
Anton Piller orders This case furnishes an illustration of both the virtues and vices of Anton Piller orders. The virtue was that the plaintiff was enabled to recover the item three list and the item four list and other documents, which, I strongly suspect, would never have seen the light of day if lessdraconiansteps,suchasanorder for delivery upof all documents containing confidential information regarding the plaintiffs customer contacts, had been the limit of the relief granted to the plaintiff. In all probability incriminating evidence of that nature would simply have been destroyed. But this result was achieved at a very high price. As I have said, the defendants' claims arising out of the faulty execution of the Anton Piller order were disposed of by an agreement reached between the parties during the course of the trial. It would, therefore, be quite wrong for me to say anything which might be understood as criticism of the conduct of those, and in particular the solicitors, who were responsible for the execution of the Anton Piller order in this action. Nevertheless, from the undisputed facts which emerged before me certain lessons are to be learned. I draw attention to these points, in the hope that thereby these problems will not arise again. The Anton Piller procedure lends itself all too readily to abuse. This has been highlighted more than once: see the powerful judgments of Scott J in

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Columbia Picture Industries Inc v Robinson [1987] Ch 38 and of Hoffmann J in Lock International Pic v Beswick [1989] 1 WLR 1268. My impression is that these warning signals have been heeded, and that Anton Piller orders are, rightly, made much more sparingly than previously. But arising out of the history of what occurred in the present case, the following points may be noted.

(1) Anton Piller ordersnormally containatermthat before complying with the order the defendant may obtain legal advice, provided this is done forthwith. This is an important safeguard for defendants, not least because Anton Piller orders tend to be long and complicated, and many defendants cannot be expected to understand much of what they are told by the solicitor serving the order. But such a term, if it is to be of use, requires that in general Anton Piller orders should be permitted to be executed only on working days in office hours, when a solicitor can be expected to be available. In the present case Mrs Hibben was alone in her house, with her children in bed. She was brought to the door in her night attire at 7.15am, and told by a stranger knocking on the door that he had a court 2005 6 MLJ 239 at 248 order requiring her to permit him to enter, that she could take legal advice forthwith, but otherwise she was not permitted to speak to anyone else at all. But how could she get legal advice at that time in the morning? She rang her solicitor's office but, predictably, there was no response. (2) There is a further feature of the situation to which I have just alluded which must never be allowed to occur again.If the order is to be executed at a private house, and it is at all likely that a woman may be in the house alone, the solicitor serving the order must be, or must be accompanied by, a woman. A woman should not be subjected to the alarm of being confronted without warning by a solitary strange man, with no recognisable means of identification, waving some unfamiliar papers and claiming an entitlement to enter her house and, what is more, telling her she is not allowed to get in touch with anyone (except a lawyer) about what is happening. (3) In the present case a dispute arose about which documents were taken away, and from which of the premises visited. Understandably, those who execute these orders are concerned to search and seize and then get away as quickly as possible so as to minimise the risk of confrontation and physical violence. Nevertheless, in general Anton Piller orders should expressly provide that, unless this is seriously impracticable, a detailed list of the items being removed should be prepared at the premises before they are removed, and that the defendant should be given an opportunity to check this list at the time. (4) Anton Piller orders frequently contain an injunction restraining those on whom they are served from informing others of the existence of the order for a limited period. This is to prevent one defendant from alerting others to what is happening. There is an exception for communication with a lawyer for the purpose of seeking legal advice. In the present case that injunction was expressed to last for a whole week. That is far too long. I suspect something went awry with the drafting of the order in this case. (5) In the present case there was no officer or employee of TPL or Emco present when their offices and workshops were searched and documents and components taken away. This is intolerable. Orders should provide that, unless there is good reason for doing otherwise, the order should not be executed at business premises save in the presence of a responsible officer or representative of the company or trader in question.

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(6) The making of an Anton Piller order in this case can be seen to be justified by what was discovered. But it is important not to lose sight of the fact that one thing which happened was that Mr James carried out a thorough search of all the documents of a competitor company. This is most unsatisfactory. When Anton Piller orders 2005 6 MLJ 239 at 249 are made in this type of case consideration should be given to devising some means, appropriate to the facts of the case, by which this situation can be avoided. (7) Anton Piller orders invariably provide for service to be effected by a solicitor. The court relies heavily on the solicitor, as an officer of the court, to see that the order is properly executed. Unhappily, the history in the present case, and what has happened in other cases, show that this safeguard is inadequate. The solicitor may be young and have little or no experience of Anton Piller orders. Frequently he is the solicitor acting for the plaintiff in the action, and however diligent and fair minded he may be, he is not the right person to be given a task which to some extent involves protecting the interests of the defendant. I think there is force in some of the criticisms set out in the invaluable article by Professor Dockray and Mr Hugh Laddie QC on ' Piller Problems' (1990) 106 LQR 601. It seems to me that the way ahead here, pursuing one of the suggestions made in that article, is that when making Anton Piller orders judges should give serious consideration to the desirability of providing, by suitable undertakings and otherwise: (a) that the order should be served, and its execution should be supervised, by a solicitor other than a member of the firm of solicitors acting far the plaintiff in the action; (b) that he or she should be an experienced solicitor having some familiarity with the workings of Anton Piller orders, and with judicial observations on this subject (eg, as summarised in the notes in The Supreme Court Practice 1991 to RSC, O 29, r 3); (c) that the solicitor should prepare a written report on what occurred when the order was executed; (d) that a copy of the report should be served on the defendants; and (e) that in any event and within the next few days the plaintiff must return to the court and present that report at an inter panes hearing, preferably to the judge who made the order. As to (b), I can see advantages in the plaintiff being required to include in his evidence, put to the judge in support of his application for an Anton Piller order, details of the name of the solicitor and of his experience.

Of course this procedure would add considerably to the cost of executing an Anton Piller order. The plaintiff would have to be responsible for paying the fees of the solicitor in question, without prejudice to a decision by the court on whether ultimately those costs should be borne in whole or in part by the defendant. But it must be appreciated, and certainly it is my view, that in suitable and strictly limited cases, Anton Piller orders furnish courts with a valuable aid in their efforts to do justice between two parties. Especially is this so in blatant cases of fraud. It is important therefore that these orders should not be allowed to fall into disrepute. If further steps are necessary to prevent this happening, they should be taken. If plaintiffs wish to take advantage of this truly draconian type of order, they must be prepared to pay for the safeguards experience has shown are necessary if the interests of defendants are fairly to be protected. 2005 6 MLJ 239 at 250

24 The court of our neighbouring country, Singapore, also took a similar position even before the introduction of the 1995 Practice Direction as reflected in the case of Computerland Corp v Yew Seng Computers Pte Ltd [1991] 3 MLJ 201 (also when Thean J said at p 205 [1991] SLR 247)
More recently, in Columbia Picture Industries Inc & Ors v Robinson & Ors [1987] Ch 38; [1986] 3 All ER 338, Scott J demonstrated in very vivid terms the serious practical effects and far-reaching consequences produced by an Anton Piller order. He said at pp 72-73:

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But notice the position that Anton Piller procedure, and its logical consequences, produces: a mandatory order is made in the absence of the respondent and in secret; it is served upon and executed against the respondent without his having any chance to challenge the correctness of its grant or to challenge the evidence on which it was granted. Now let the possible and, perhaps, probable effects of an Anton Piller order be considered. The order is served and executed. If the order is in the terms of the order in the present case and is executed as it was in the present case, there will be a wholesale removal of all business material, whether stock-in-trade, bank statements, cheque books or correspondence. The continuance of the business by the respondent to the order is thereby made impossible. How can a business be continued without records? How can it be continued without stock-in-trade? It will be recalled that, in the present case, the order authorised the removal of, inter alia, the video recorders at 8 Frederick Street. They were not, in the event, removed but, if they had been, the whole of Mr Robinson's copying business would for that reason alone have been closed down. It is customary, on account of the mareva injunction accompanying Anton Piller orders, for a copy of the order to be served on the respondent's bankers. That was done in the present case. The almost certain effect of that being done will be that the bankers will decline to allow any further credit to the respondent. The order will throw such a question mark over the business of the respondent as to make any other course commercially imprudent and, therefore, unlikely. In the present case, Barclays Bank, upon service of the order, refused to allow the defendants any further credit. The service and execution of an Anton Piller order is likely to have on a respondent a personal as well as a commercial effect. Anton Piller orders are often granted not simply in respect of business premises but in respect of the respondent's home. He is required, on pain of committal, to open the doors of his house to the plaintiffs' representatives and to permit a search of the contents thereof. The plaintiffs and their representatives are at liberty to search and rummage through the personal belongings of any occupant of the house and to remove the material they consider to be covered by the terms of the order. The traumatic effect and the sense of outrage likely to be produced by an invasion of home territory in the execution of an Anton Piller order is obvious. Later, he said at p 76:

But a decision whether or not an Anton Piller order should be granted requires a balance to be struck between the plaintiff's need that the remedies allowed by 2005 6 MLJ 239 at 251 the civil law for the breach of his rights should be attainable and the requirement of justice that a defendant should not be deprived of his property without being heard. What I have heard in the present case has disposed me to think that the practice of the court has allowed the balance to swing much too far in favour of plaintiffs and that Anton Piller orders have been too readily granted and with insufficient safeguards for respondents. We respectfully agree with the observations made by these two judges. It is also our experience that in Singapore too free a use has been made by plaintiffs of the Anton Piller orders, and all too often such orders have been applied for without sufficient grounds and on a bare allegation, without any evidence in support, that there was a fear or likelihood that material evidence would be destroyed or removed or made to disappear by the defendants. Our court has also, on some occasions, responded favourably to such applications and, in the words of Scott J, has allowed the balance to swing in favour of the plaintiffs. It is therefore imperative that on every application for an Anton Piller order the party seeking it must satisfy the stringent requirements laid down in the Anton Piller case and the court must scrutinize with care the evidence produced and must, in the words of Browne- Wilkinson J, be very circumspect in granting such an order.

25 In turn, our courts when accepting the doctrine had in fact ensured that such guidelines and safeguards incorporated in those highly persuasive decisions were followed. That is plain common sense. Otherwise it would be like arming an applicant with 'one of the law's two 'nuclear' weapons' per Donaldson LJ (as he then was) in Bank Mellat v Nikpour [1985] FSR 87 at p 90 to be used at his whims and fancies. Thus, we are entirely in agreement with the observation of the learned judge in the case of Makonka Electronic Sdn Bhd v Electrical Industry Workers' Union & Ors when he said:
It is a draconian order, granted by the court upon the balance of undertakings by the applicant and upon specific terms and conditions. Those terms, conditions and undertakings cannot be ignored or left for subsequent compliance at will. Compliance with the terms of the conditions and undertakings are necessary pre- conditions to the enforcement of the order...

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The Anton Piller order is a valuable procedure and ought to be preserved. The efficacy, however, of the Anton Piller procedure depends very much on all the parties seeking a fine balance to protect their respective interests and rights. A solicitor acting for an applicant must remember at all times that he is an officer of the court, and to ensure that the application he is putting forward contains adequate safeguards of the basic rights of the other party. It is not that he is obliged to act for the other party, but that he is bound to ensure the procedure is not abused. He must put forward a reasonable application if it is to be entertained. He should for example ensure:

1 That there is full and frank disclosure of all relevant information and evidence to justify the issue of the order. 2005 6 MLJ 239 at 252 2 The order must be drawn such that it extends no further than the minimum necessary to achieve the preservation of evidence which may be otherwise removed or destroyed. 3 The application includes first alternative prayers for orders to produce and deliver specific evidence. Only upon the respondents' failure to produce and deliver such evidence would the other orders of the Anton Piller order are to come into effect. This would offer a 'less draconian unless necessary' approach, and by specifying the evidence to be produced avoid fishing expeditions and unnecessary invasion into unrelated information. 4 That the application contains clear and specific undertakings that the order will be served by a solicitor who will at the same time supply a copy of the application and all affidavits and documents put before the judge in making the application; explain its exact terms to the respondent; advise him to seek immediate legal advice and that he has a reasonable time to do so. 5 That the application contains clear undertakings for damages, and that the evidence obtained will not be used in any other proceedings without the consent of the court. 6 As a further safeguard, to have a separate solicitor to supervise the execution by the applicants' solicitors, and persons who are to accompany him are to be named in the order so that they may be identified by the respondent (see Vapormatic Co Ltd v Sparex Ltd [1976] 1 WLR 939).

The purpose of the safeguards is to ensure that the enforcement of the order could be carried out in a peaceful and orderly manner. For that purpose the order must be carried out strictly on its terms and the undertakings thereunder. Where there has been non-compliance, the order has become liable to set aside and such non-compliance cannot be corrected bv subsequent compliance. Such a strict approach is necessary to guarantee that Anton Piller orders are carried out strictly according to its terms and no further. For this reason the order was subsequently set aside upon application of the respondent, and cannot be the basis of an application for leave to commence committal proceedings against the respondent. (Emphasis added.)

26 Hence, in this country even with the absence of any Practice Direction the application and execution of an Anton Piller order is subject to stringent requirements, guidelines and safeguards. In other words any departure would be contrary to the common law of Malaysia as such point has already been well established. We therefore rejected the contention of learned counsel for the respondent. 27 Reverting now to the second issue, we examine first whether there was any substantive non-compliance

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as alleged by the appellant. We take the reverse approach, that is, to first consider the contents and the execution of the said Order. We will deal with the prerequisite elements later. 2005 6 MLJ 239 at 253 28 On perusal of the said Order we found obvious omission to incorporate any undertakings and safeguards that should be stipulated in an Anton Piller order. It is also not in dispute that it was the solicitor for the respondent who came to the premises of the appellant armed with the said Order. At the material time no independent solicitor was present to supervise its execution. There is also no record to indicate that the appellant was informed of its right to legal advice before the execution was carried out. In fact we would say that there was hardly any compliance with any of the guidelines as stipulated in the decisions of our courts and now part of our common law. The only excuse rendered by the respondent was that it was only executing a mandatory injunction. We have debunked that argument. 29 Hence, there was a total failure by the respondent to observe the minimum requirements as to the contents and the execution of the said Order which elements the learned High Court judge failed to address. On this ground alone that we had no hesitation to set aside the said Order which we did. There is no question of exercise of discretion here. And that should effectively settle encl 7 and the related appeal. 30 But having heard the arguments, we deem it desirable to at least briefly address the other aspect of the substantive non-compliance issue raised by the appellant, namely, on the assertion that the respondent at the ex-parte stage failed to satisfy the prerequisite elements for the grant of an Anton Piller order. 31 It is settled that the basic requirements to be satisfied by an applicant for an Anton Piller order at an ex parte stage are as follows: (a) (b) (c) (d) (e) to disclose an extremely strong prima facie case, that a refusal to grant the order will have a very serious effect to the applicant, that it must be established that the defendant has in its possession the relevant documentsand/or materials being sought for and that there is a real possibility that the defendant may destroy such documents and/or materials, that the applicant is required to make a full and frank disclosure, and that the order should contain the necessary undertakings and safeguards to be complied with upon its execution.

32 We have already dealt with item (e). As for the other items we do not think we should address each one of them. Suffice that we only examine those that we think are critical. It is in the forefront of our minds that, as in any other types of injunction, the grant or refusal of an Anton Piller order is a 2005 6 MLJ 239 at 254 matter of discretion. And when such discretion is properly and judiciously exercised there can hardly be any justification for an appellate court to intervene. 33 It was the submission of learned counsel for the appellant that overall the application was premised on baseless speculations and hearsay. He contended that reliance by the learned High Court judge on paras 12 and 13 of encl 2 was misconceived in that nowhere the deponent had averred that he had sight of the 'working papers, notes and documents' in possession of the appellant in stark contrast to the position in Yousif v Salama [1980] 3 All ER 405 which the learned High Court judge relied on as the authority for his decision. It was also pointed out to us that in any event Yousif's case could not be a strong authority to follow being only a majority decision with strong dissenting judgment and having been criticised in subsequent cases. 34 We think there is merit in the argument. The present case is factually different from Yousif's case. In the first place there was no assertion from any of the deponents of the affidavits filed for the respondent that the documents were seen in the possession of the appellant. In Yousif's case the plaintiff visited the defendants' office where he saw the accounts showing the amount of commission due to him. The plaintiff then issued a writ claiming the amount owed and, fearing that the defendants might destroy the two files containing the accounts and a diary which contained details of the transactions, applied for and was granted by the majority

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in the English Court of Appeal an Anton Piller order permitting him to enter the defendants' premises to search and locate the files and diary and remove them to the custody of his solicitor. But as pointed out by learned counsel even this decision is not without criticisms. For one, there is the strong dissenting view of Donaldson LJ that on the facts of the case it would have been more appropriate for the plaintiff to seek for an account with the usual inquiries or for discovery instead of an Anton Piller order. Similar negative view was also expressed in the case of Computerland Corp v Yew Seng Computers Pte Ltd. 35 Thus in our opinion and with respect it was quite erroneous for the learned High Court judge in the present case to conclude that Yousif's case substantively supported him in the exercise of his discretion. 36 The respondent also failed to address another factor at the ex-parte stage, namely, on the serious consequence to it if its application was refused. 37 We agree with the contention of learned counsel for the appellant that there is nothing in the supporting affidavit or in any of the other affidavits filed on behalf of the respondent which expressed such apprehension. 38 Another assertion of the appellant was that the respondent failed to make a full and frank disclosure of all material facts known to it at the ex- parte stage. Specific reference was made to the failure by the respondent to inform 2005 6 MLJ 239 at 255 the learned High Court judge of the existence of a discovery order in relation to Lau's suit. It was contended that although the parties were different the subject matter and dispute were related or connected to the present case and thus should have been disclosed. 39 In Siporex Trade SA v Condel Commodities Ltd [1986] 2 ILR 428 Bingham J (as he then was) said this at p 437:
The scope of the duty of disclosure of a party applying ex parte for injunctive relief is, in broad terms, agreed between the parties. Such an applicant must show the utmost good faith and disclose his case fully and fairly. He must, for the protection and information of the defendant, summarise his case and the evidence in support of it by an affidavit sworn before or immediately after the application. He must identify the crucial points for and against the application, and not rely on general statements and the mere exhibiting of numerous documents. He must investigate the nature of the cause of action asserted and the facts relied on before applying and identify any likely defences. He must disclose all facts which reasonably could or would be taken into account by the judge in deciding whether to grant the application. It is no excuse for an applicant to say that he was not aware of the importance of matters he has omitted to state. If the duty of full and fair disclosure is not observed thw court may discharge the injunction even if after full enquiry the view is taken that the order made was just and convenient and would probably have been made even if there had been full disclosure. (Emphasis added.)

40 As expressed by the English courts it is also the law in this country that when applying for an ex-parte order an applicant is duty-bound to make an honest, full and frank disclosure of all relevant material facts within his knowledge, which failure may be a ground to set aside any order granted. (See: President Hotel Sdn Bhd v Dato Bandar Kuala Lumpur & Anor (75) MD 1, Bakmawar Sdn Bhd v Malayan Banking Bhd [1992] 1 MLJ 67, Makonka Electronic Sdn Bhd v Electrical Industry Workers' Union & Ors. 41 We note that the purported reason given by the respondent for not disclosing the existence of the discovery order was because the parties involved were different. It is not in dispute that Lau's suit was commenced by an individual. And in agreeing with the respondent and ruling that Lau's suit was irrelevant the learned High Court judge also took into account the different solicitors handling these cases. But with respect, we are of the view that such approach is too simplistic. As pointed out by learned counsel for the appellant the answer lies in para 9 of encl 9 where Koh Kim Chui affirmed on 16 March 1999 thus:
I would respectfully say that the alterations which were done by the first defendants was for the purpose of concocting a defence for themselves in Civil Suit MT3-22- l203 of 1998 before this Honourable Court. I am informed that the first defendant is the defendant in Civil Suit No MT3-22-1203 of 1998 and the issues raised therein pertains directly to the documents taken pursuant to the Anton Piller order. 2005 6 MLJ 239 at 256

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42 Hence, we would say that the failure to disclose the existence of the discovery order arising from Lau's suit would tantamount to a failure to make a full and frank disclosure of a relevant material fact at the ex-parte stage. While generally such failure would be a ground to set aside any ex-parte order granted, it is not so in all cases. It depends on the facts and circumstances of each case. (See: Tan Guan Eng & Anor v Ng Kweng Hee & Ors [1992] 1 MLJ 487 following the view expressed by Sir Nicolas Browne-Wilkinson VC in Dormeuil Freres SA & Anor v Nicolian International (Textiles) Ltd [1988] 3 All ER 197; [1988] 1 WLR 1362). 43 In the appeals before us such failure was not the only deficiency of the application in term of the essential elements required to be satisfied at the ex parte stage. We have already given our views on the others. Thus in our judgment this deficiency provided another ground to rule that the said Order should not be sustained. No doubt the grant was an exercise of discretion, but it has been shown to our satisfaction that such exercise was unjustified, premised on wrong principles and was unjust in the circumstances. Accordingly as an appellate court, it behoves upon us to set things right and to intervene as we did. (See Evans v Bartlam [1937] AC 473; Ratnam v Cumarasamv & Anor [1965] 1 MLJ 228). 44 The other thrust in the submissions of learned counsel for the appellant was on procedural non-compliance at the ex parte stage, specifically with O 29 of the Rules of the High Court 1980 ('RHC'). 45 Learned counsel for the appellant gave a litany of procedural non- compliance with the provisions of O 29 of the RHC by the respondent. These may be summarised thus: (a) (b) there was a failure to comply with O 29 r 1(2A)(a), (b), (c), (d), (e), (f) and (g) of the RHC; and there was non-compliance with O 29 r 1(2) of the RHC in that the nature of the urgency of the application was not shown or stated.

46 On perusal of the application (encl 3) and the supporting affidavit of Koh Kim Chui affirmed on 9 January 1999 (encl 2) we noted, inter alia, that there was nothing stated therein to indicate that the appellant was given notice of the intended application or the reason for not doing so. Understandably, the application was for an Anton Piller order in which the elements of secrecy and speed are essential. But surely an explanation to that effect could have been given in the affidavit. It was also not included in the affidavit any answer given by the appellant, or which was thought likely to be asserted by it, either to the claim in the action or to the claim for interlocutory relief. Further, there was no clear and concise statement of facts stated which gave rise to the claim 2005 6 MLJ 239 at 257 and the interlocutory relief sought for nor was there a clear and concise statement of the relief sought. A clear and concise statement of any fact known to the respondent which might lead the court not to grant the Order sought ex parte or the absence of such fact was also not stated. Thus, we agree with the learned counsel for the appellant that the respondent had failed to satisfy the prerequisites of O 29 r (1)(2A) of the RHC. 47 Another obvious omission in the application and the supporting affidavit was a statement or reason as to the nature of the urgency thereby justifying the application to be made ex parte. There was no explanation given for the gap of about one month between the affirmation of the affidavit in support and the actual filing of the application. The time gap, in our view, did not indicate any urgency in the matter. Indeed the respondent could not for that reason be heard to say subsequently that the matter was urgent. 48 Accordingly, we were and are satisfied that there was a blatant failure to observe the provisions of O 29 of the RHC which left this court with no choice but to set aside the said Order. In coming to our conclusion we were reminded of the decision of this court in Motor Sports International Ltd (Servants or Agents at Federal Territory of Labuan) & Ors v Delcont (M) Sdn Bhd [1996] 2 MLJ 605 where Gopal Sri Ram JCA in his judgment said this at p 490:
The provisions of O 29 r 2A were introduced by amendment in order to ensure that ex parte injunctions of any sort were not granted willy-nilly, but only in cases where they were truly called for. In order to ensure that the policy behind the introduction of r 2A is not defeated, High Courts must demand strict compliance with its terms. More so, when the relief applied for is in the nature of a mareva or an Anton Piller type of injunction because of the incalculable harm and damage that may be caused to a defendant by the grant of either of these orders.

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Having perused the affidavit in question, we find that there has not been even a feeble attempt to meet the requirements of r 2A, especially sub-para (d) thereof. On this ground alone, the ex pane injunction ought to have been dissolved by the learned judge.

(See HMO Pacific Sdn Bhd v Dr Johari b Muhamad Yusup [1997] MLJU 286). 49 We did also consider the other points raised by both parties. But our views on them would not alter our conclusions hereinabove. In the event and for the reasons aforesaid we allowed the appeal against the decision of the learned High Court judge in respect of encl 7 and set aside the said Order. 50 In view of our decision in respect of encl 7 it was inevitable that we should and did also allow the appeal against the decision of the learned High Court judge on encl 10. 2005 6 MLJ 239 at 258 51 Having allowed both the appeals by the appellant we further ordered that the respondent pay to the appellant damages to be assessed by Registrar of the High Court. We also ordered that costs for these appeals to be taxed and paid to the appellant and the deposit paid be refunded. Appeals allowed.

Reported by Izzaty Izzuddin

Malayan Law Journal Unreported/2003/Volume /ESPL (M) SDN BHD v HARBERT INTERNATIONAL EST SDN BHD - [2003] MLJU 81 - 20 January 2003 100 pages [2003] MLJU 81

ESPL (M) SDN BHD v HARBERT INTERNATIONAL EST SDN BHD

HIGH COURT (KUALA LUMPUR) ABDUL MALIK ISHAK J CIVIL SUIT NO S5-22-612-2002 20 January 2003 Civil Procedure -- Contempt of court -- Breach of court order -- Defendant failed to fully complied with court order -- Application by defendant to set aside court order -- Whether defendant's application amounted to an abuse of the process of the court -- Whether defendant's application should not be heard until defendant purged its contempt Civil Procedure -- Discovery -- Application for -- Anton Piller order and Norwich Pharmacal order -- Whether there was extremely strong prima facie case against defendant -- Whether damage to the plaintiff was very great if order not granted -- Whether there was clear evidence that defendant had incriminating documents in his possession -- Whether there was real possibility that defendant might destroy incriminating material before hearing of inter partes application Ramid Khan Bin Rahman Khan with Brain Cumming (Tay & Partners), Gideon Tan with Syamsuriatina Ishak (Gideon Tan Razali Zaini)

GROUNDS OF JUDGMENT Introduction

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Enclosure 16 at prayer (i) thereto is the defendant's application to set aside the Norwich Pharmacal Order coupled with the Anton Piller Order dated August 2, 2002 as reflected in enclosure 13 that was obtained on an ex parte basis (hereinafter referred to as "the said Order"). Enclosure 16 too at prayer (ii) thereof seeks for a stay of execution of the said Order pending the disposal of the defendant's application to set aside the said Order. While prayers (iii) and (iv) of enclosure 16 are worded in these fashions:
"(iii) costs of this application to be borne by the plaintiff; and (iv) such further or other relief as this Honourable Court deems fit."

[2003] MLJU 81 at 2 Enclosure 16 is supported by an affidavit of Patrick B. Mitchell that was affirmed on August 10, 2002 as seen in enclosure 14. The plaintiff's affidavit in reply that was affirmed by Chan Kwai Moon on August 15, 2002 can be seen in enclosure 20. It must be put on record that the defendant did not file an affidavit in response to enclosure 20, and so, enclosure 20 remains unrebutted. There are also other relevant affidavits that must be mentioned here and they are as follows: (1) (2) (3) (4) the affidavit of Ong Chee Kwan that was affirmed on August 12, 2002 as seen in enclosure 17 which incidentally is annexed as an exhibit marked as "CKM-2" to that of enclosure 20. the affidavit of Ong Chee Kwan that was affirmed on August 14, 2002 as reflected in enclosure 23 which is also annexed as an exhibit marked as "CKM-4" to that of enclosure 20; the affidavit of Alex Nandaseri De Silva that was affirmed on August 19, 2002 as reflected in enclosure 21; and the affidavit of Chan Kwai Moon that was affirmed on August 19, 2002 as reflected in enclosure 22. [2003] MLJU 81 at 3

Before proceeding to hear enclosure 16, the plaintiff's counsel raised a preliminary objection to the following effect :
"That enclosure 16 -- the defendant's application, ought not to be heard until the defendant has fully complied with and/or purged its contempt in relation to the said Order dated August 2, 2002 as seen in enclosure 13."

This judgment is all encompassing. It decides not only on the preliminary objection but also on other germane issues as well. The Norwich Pharmacal Order coupled with the Anton Piller Order dated August 2, 2002 -- the said Order. On June 25, 2002, the plaintiff withdrew its ex parte summons in chambers in enclosure 3 with liberty to file afresh and this court struck out enclosure 3 without costs and gave liberty to the plaintiff to file afresh. And so with that mandate, the plaintiff filed afresh enclosure 6. Now, enclosure 6 is the plaintiff's ex parte application for, inter alia, a pre-trial order for discovery against the defendant pursuant to the principle enunciated in the celebrated case of Norwich Pharmacal Co and others v Commissioners of Customs and Excise (1973) 2 All ER 943, H.L., and an Anton Piller Order following the case of Anton Piller KG v Manufacturing Processes Ltd and others (1976) 1 All ER 779, C.A. in [2003] MLJU 81 at 4 aid of discovery for the purpose of discovering, obtaining and preserving documents and other pieces of evidence so obtained. Enclosure 6 is supported by an affidavit in enclosure 5. Now, briefly, enclosure 6 relates to the discovery of the identities of the wrong doers and to gather

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information and secure documents passing between the main contractor and the sub-contractor involved in the construction of the Retail Podium Project forming part of the Kuala Lumpur City Centre Project ("the KLCC project") undertaken by the employer by the name of Amalan Kreatif Sdn Bhd ("AKSB"). Econoler Singapore Pte Ltd ("Econoler") was the original sub-sub-contractor responsible for undertaking construction, supply and commissioning of the Air Conditioning and Mechanical Ventilation works portion of the Retail Podium Project ("the Mechanical Works") pursuant to a sub-sub-contract dated March 12, 1996 (see exhibit "CKM 5" of enclosure 5). Soon thereafter Econoler novated the sub-sub-contract to the plaintiff pursuant to a novation agreement dated May 1, 1996. So, for all intents and purposes, the plaintiff stands in the shoes of Econoler as the sub-sub-contractor for the Mechanical Works (see page 209 of exhibit "CKM-6" of enclosure 5). [2003] MLJU 81 at 5 The defendant, on the other hand, undertook the role as the joint venture leader and consultant of the main contractor by the name of Henz Construction which consisted of a joint venture between the defendant, Nam Fatt Berhad ("Nam Fatt"), Esprit Corporation Sdn Bhd ("Esprit") and Zaq Construction Sdn Bhd ("Zaq"). Towards this end, reference to exhibit "CKM-1" of enclosure 5 and exhibit"CKM-3" of enclosure 5 would certainly be germane to the occasion. Now, Radio and General Engineering Sdn Bhd (formerly known as "The Radio & General Trading Co. Sdn Bhd") and hereinafter referred to as "R&G" is a sub-contractor of the Retail Podium Project consisting of the Mechanical Works and Electrical Works pursuant to a letter of undertaking with Henz Construction dated January 18, 1995 and the sub-contract dated August 25, 1995 (see exhibit "CKM-3" of enclosure 5 and exhibit CKM-4" of enclosure 5). It is germane to mention that the sub-contract consisting of the Mechanical and Electrical Works was awarded to R&G for RM140,594,341.00 who in turn sub-sub contracted the Mechanical Works to the plaintiff for the sum of RM84,965,930.00. R&G retained and carried out [2003] MLJU 81 at 6 the Electrical Works aspect of the Retail Podium Project themselves (see exhibit "CKM-4" of enclosure 5 and exhibit "CKM-5" of enclosure 5). Contractually, the relationship between Henz Construction, R&G and the Plaintiff is in the nature of being the main contractor, the sub-contractor and the sub-sub-contractor respectively (see exhibit "CKM-4" of enclosure 5 and exhibit "CKM-5" of enclosure 5). There were documents highlighting the fact that, at all material times, the intention of the parties was that R&G and the plaintiff are to be treated equally with the concurrence and knowledge of Henz Construction (see exhibit "CKM-3" of enclosure 5, exhibit "CKM-4" of enclosure 5, and exhibit "CKM-5" of enclosure 5). From the available documents, it is quite apparent that R&G and the plaintiff had, at all material times, intended to treat each other as equal partners notwithstanding the sub-sub-contractual relationship between the two which albeit was as a result of an operational necessity since Econoler did not have a wholly owned subsidiary incorporated in Malaysia at the time (see exhibit "CKM-5" of enclosure 5 and exhibit "CKM-6" of enclosure 5. The application in enclosure 6 was premised upon the plaintiff's belief that certain persons or individuals were responsible for procuring R&G to breach the sub-sub-contract by, inter alia: [2003] MLJU 81 at 7 (a) (b) Deliberately withholding and concealing interim certificates preventing the plaintiff from ascertaining the actual amounts received by R&G for Mechanical Works which are due, forthcoming and payable to the plaintiff. Instructing and/or inducing Henz Construction to use a rubber stamp different from the one designed on its cheques for progress payment thus enabling payments for Mechanical Works to be diverted from the joint bank account as alluded to in Appendix "D" of the sub-sub-contract (see exhibit "CKM-5" of enclosure 5). The joint bank account was worded in this fashion:
"1.1.R&G shall open a current account with Bank of Commerce, main branch, to be designated as

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'The Radio & General Trading Co. Sdn Bhd -- KLCC Account No: 1' which will be referred to hereinafter as the 'Joint Bank Account'. 1.2. The Joint Bank Account will be jointly operated by one each of an equal number of signatories authorised by R & G and ESPL respectively. R & G shall irrevocably instruct the bank that any amendment to the conditions of operating the Joint Bank Account must be endorsed by the authorised signatories as set out above."

(c)

It is said that the diversion from the joint bank account was very alarming and to the point of being very serious; indeed it is an alarming state of affairs. [2003] MLJU 81 at 8 Removing the plaintiff's authorised co-signatory to the joint bank account without the plaintiff's knowledge, consent or approval and thereafter withdrawing payments for the Mechanical Works from the joint bank account.

It must be emphasised that the plaintiff had substantially completed the Mechanical Works in time for the soft opening of KLCC on May 8, 1998, thus signifying that the plaintiff's scope of works were already operational. The consultant engineers, by the name of KTA Tenaga Sdn Bhd, had by way of its memo dated April 11, 1998 described the five aspects of Mechanical Works undertaken by the plaintiff to be completed in accordance to the following percentages: 92%, 99%, 99%, 92% and 95% complete (see exhibit "CKM-8" of enclosure 5 for details). There were non-payments for Mechanical Works. For instance, between 14.6.1996 to 16.1.1998, R&G had progressively banked in payments for Mechanical Works it received from Henz Construction via interim certificates nos: 2 to 21 into the parties joint bank account in accordance with the intention of the parties and it too supplied the plaintiff with copies of the relevant interim certificates. But thereafter R&G started to depart from the practice by, inter alia, refusing to provide the plaintiff [2003] MLJU 81 at 9 with the copies of the interim certificates, and withholding or refusing to make payments for the Mechanical Works and failing to notify the plaintiff or to provide the plaintiff with the reasons for its failure to do so. The interim certificates in question would be certificate no: 22a, certificate no: 22b and certificate no: 24b. I would now refer to these interim certificates briefly. Certificate no: 22a It is said that R&G had failed to provide the plaintiff with a copy of Henz Construction's certificate no: 22a and not only that R&G too had not made any payment to the plaintiff. Now, a comparison with the "Certified Previously" column in interim certificate no: 22b as per page 243 of exhibit "CKM-10" of enclosure 5 would show a sum of RM76,459,330.41 was being certified previously as the net estimated value of works while the "Certified To Date" column in interim certificate no: 21 as per page 242 of exhibit "CKM-10" of enclosure 5 would show a sum of RM70,459,330.41 as the net estimated value of works certified due in the same certificate. So the difference in these two figures confirmed that a sum of RM6,000,000.00 had been certified as net [2003] MLJU 81 at 10 estimated value of works completed under interim certificate no: 22a for the period ending at or around 31.12.1997. The diagrammatic breakdown of the calculations can be seen at page 46 of enclosure 5. It must be borne in mind that the existence of interim certificate no: 22a was beyond dispute since it had been confirmed by Henz Construction in its letter dated 27.2.1998 as seen at lines 2 and 3 of page 251 of exhibit "CKM-11" of enclosure 5. The plaintiff had made numerous requests for copies of the interim certificate no: 21a and the payment certified due thereunder but failed to obtain any positive response from R & G. It must be noted that R & G remained uncooperative till to date (see exhibit "CKM-12" of enclosure 5). Certificate no: 22b

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The plaintiff alleged that it had never received payments from R&G pursuant to this certificate -- namely, certificate no: 22b. It seemed that certificate no: 22b would show a positive net amount due for the Mechanical Works. [2003] MLJU 81 at 11 By perusing through the "Certified This Period" column in interim certificate no: 22b as seen in exhibit "CKM-10" of enclosure 5 would show that the net estimated value of Mechanical Works for the period ending on 31.12.1997 came up to RM1,526,917.58 and that after deducting the advancements that were made, it left a net payable balance of RM326,917.58 for the Mechanical Works. Sadly, the plaintiff's requests for the details and explanations for the non-payment under Certificate no: 22b had gone unheeded. R&G simply refused to respond (see exhibit "CKM-12" of enclosure 5). Certificate no: 24b Some payments were received by the plaintiff under this certificate but the plaintiff was unable to conclusively ascertain nor verify whether the amount received represented the whole amount that was actually certified as due for the Mechanical Works. This was due to the refusal of R&G to provide the plaintiff with a copy of the certificate. It must be noted that the sum of RM663,524.77 was received from R&G on 4.5.1998 under this certificate and it was for work done for the [2003] MLJU 81 at 12 period ending on or about 28.2.1998. R&G had confirmed the existence of this certificate in its own payment as seen in exhibit "CKM-13" of enclosure 5, but R&G still refused to provide the plaintiff with a copy of this certificate. It was therefore natural that the plaintiff was uncertain as to whether the amount that was received was the whole amount certified due by Henz Construction for the Mechanical Works for that period of time. Non payments of the plaintiff's progress claims There were also non payments of the plaintiff's progress claims. I will briefly explain. The interim certificate no: 23 as seen at page 27 of exhibit "CKM-10" of enclosure 5 showed the estimated value of Mechanical Works for the period ending on 31.1.1998 to be RM74,293,233.00 But, to date, the plaintiff had only received the sum of RM66,288,443.00 as seen in the diagram at page 42 of enclosure 2 from R&G. It must be borne in mind that the sum of RM8,044,790.00 less than the amount estimated in interim certificate no: 23 and the sum of RM18,677,486.19 less than the sub-sub-contract sum of RM84,965,930.00 that was awarded. All these can be seen at page 155 of exhibit "CKM-5" of enclosure 5. [2003] MLJU 81 at 13 Be that as it may, the plaintiff continued to undertake construction of the Mechanical Works from February 1998 to 18.7.1998. This was the date when R&G unilaterally took over the Mechanical Works from the plaintiff and it was six months after the issuance of interim certificate no: 23 and two months after the soft opening of KLCC on 8.5.1998. Notwithstanding the fact that the plaintiff had carried out its obligations pursuant to the sub-sub-contract over the said period, R&G still failed to make any payments to the plaintiff and this continued despite the fact that the plaintiff had submitted its progress claims dated 24.1.1998, 26.2.1998, 25.3.1998, 25.4.1998, 20.5.1998 and 26.6.1998. Towards this end, it would be ideal to refer to the diagram at page 44 of enclosure 5 and to exhibit "CKM-10" of enclosure 5. It was submitted that since the plaintiff had substantially completed the Mechanical Works as at the date of the soft opening of the KLCC on 8.5.1998 -- a fact that was corroborated by looking at the percentage of completion of the Mechanical Works in KTA Tenaga's memo as seen in exhibit "CKM-8" of enclosure 5, then the plaintiff would be entitled to receive payments higher than the amount certified under interim certificate no: 23 for this period of time. [2003] MLJU 81 at 14 The queries which the plaintiff had made with Henz Construction on 4.12.1998 revealed that R&G had also

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received payment from Henz Construction some three weeks prior to that but, unfortunately, the sum was not disclosed by Henz Construction and was not paid by R&G to the plaintiff. The joint bank account In regard to the joint bank account, I have this to say. It appears that on 6.6.1996, R&G opened a current account bearing no: 1408-1194175-05-0 with the Bank of Commerce main branch and this account was to be jointly operated by one signatory each from R&G and the plaintiff in accordance with the intention of the parties as reflected at paragraph 7 of the sub-sub-contract read with Appendix "D" of that contract (see page 153 and page 206 of exhibit "CKM-5" of enclosure 5). That account was designated as "The Radio & General Trading Co.Sdn Bhd -- KLCC Account No: 1" (see exhibit "CKM-15" of enclosure 5). It is the submission of the plaintiff that throughout, the defendant had knowledge of the sub-sub-contract and also the payment arrangements for [2003] MLJU 81 at 15 the Mechanical Works between R&G and the plaintiff. The reasons which the plaintiff advanced for saying this may be stated as follows: (1) (2) (3) Henz Construction and the defendant were privy to the letter of understanding as seen at page 108 of exhibit "CKM-3" of enclosure 5. That under clause 27.1 of the sub-contract which provides that payments for the Mechanical and Electrical Works were to be held on trust for the sub-sub-contractors as seen at page 122 of exhibit "CKM-4" of enclosure 5. That R&G by its letter dated 28.3.1996 requested the defendant to split the payments into Mechanical and Electrical Works.And by that letter too R&G informed the defendant that separate bank accounts will be established for the purpose and R&G also expressed the hope that there can be no deviations in the arrangement as planned (see page 264 of exhibit "CKM-16" of enclosure 5). The defendant too had responded to R&G's letter as alluded to in (3) above. In fact, the defendant by letter dated 5.4.1996 agreed to split payments as requested and this can be seen at page 265 of exhibit "CKM-16" of enclosure 5. [2003] MLJU 81 at 16 By its letter dated 23.10.1996, R&G informed Henz Construction that separate bank accounts have been established and R&G then enclosed two rubber stamps to be utilised for purposes of payment into the said accounts. Henz Construction duly acknowledged the two rubber stamps. And that cheques issued as payment for the Mechanical Works were to be stamped with the rubber stamp bearing the words "Radio & General Engineering Sdn Bhd -- KLCC Account No: 1" while the cheques for payment of the Electrical Works were to be stamped with the rubber stamp bearing the words "Radio & General Engineering Sdn Bhd -- KLCC Account No: 2." It would be ideal to refer to page 266 of exhibit "CKM-16" of enclosure 5.

(4)

(5)

Payment diverted elsewhere In regard to the diversion of payment, the learned counsel for the plaintiff submitted that the plaintiff had strong reasons to believe that the arrangements for the payment were subsequently not adhered to. The plaintiff believed that Henz Construction made payments for the Mechanical Works between February 1998 after the issuance of interim certificate no: 23 [2003] MLJU 81 at 17 right up to July 1998 when the unilateral take over occurred pursuant to the issuance of interim certificates nos: 22a and 22b. According to the plaintiff, these payments were never deposited into the joint bank account. It was said that only two (2) payments were deposited into the joint bank account between the period

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extending from 31.1.1998 to 31.6.1998 as reflected in exhibit "CKM-17" of enclosure 5. Henz Construction's cheque in exhibit "CKM-18" of enclosure 5 was for the payment for Mechanical Works under the interim certificate no: 18 and it was stamped with a stamp bearing the designation "Radio & General Engineering Sdn Bhd -- KLCC Account No: 1". While the cheques for interim certificates nos: 21 and 24b as per page 274 to page 275 of exhibit "CKM-18" of enclosure 5 were stamped with a different rubber stamp bearing designation "Radio & General Engineering Sdn Bhd" without the particulars"KLCC Account No: 1." The plaintiff questioned as to what had led to the subsequent utilisation of different rubber stamp and how, if at all, did Henz Construction come to be in possession of the same. It was submitted that the usage of the different rubber stamps by Henz Construction effectively enabled R&G to [2003] MLJU 81 at 18 deposit any cheques that were received from Henz Construction into those accounts other than the joint bank account despite express instructions not to deviate from the original arrangement (see exhibit "CKM-16" of enclosure 5). The plaintiff's representatives were no longer the signatories of the joint bank account In regard to the removal of the plaintiff's representatives as the signatories to the joint bank account, the submissions of the plaintiff went like this. That it was sometime in October 1999 that the deponent of enclosure 5 by the name of Chan Kwai Moon was informed by a bank officer that R&G had altered the signing mandate of the joint bank account in April 1999 in order to remove the plaintiff's representatives as signatories thereto (see paragraph 29 of enclosure 5). And that queries by the plaintiff on this subject matter were not entertained by the bank at all. Prior to the clandestine alteration, the plaintiff was unaware and had never authorised nor endorsed the change of signatories which was clearly in [2003] MLJU 81 at 19 violation of paragraph 7 of the sub-sub contract which was to be read with Appendix "D" of the sub-sub-contract requiring amendments to the conditions of operating the joint account to be endorsed by authorised signatories (see exhibit "CKM-5" of enclosure 5). It was also pointed out that the unilateral alteration by R&G contradicted its own circular resolution as seen in exhibit "CKM-15" of enclosure 5 requiring a resolution to rescind the arrangement together with a letter to be signed by two of the plaintiff's signatories. It was also submitted that the plaintiff and its holding company by the name of Quantum Systems Pte Ltd had made persistent requests for, inter alia, payment updates of Mechanical Works, bank statements, meetings and final statement of accounts to R&G. But, the latter refused to entertain and that such refusal continues up till now. The law And in order to adjudicate on enclosure 6, I must now examine the law. [2003] MLJU 81 at 20 Order 24 of the Rules of the High Court, 1980 ("RHC") relates to discovery and inspection and it is only applicable to parties in a suit and not against a stranger who cannot be subjected to the due process of the law for want of a cause of action against him. But in the interest of the due administration of justice, equity intervenes in order to allow a separate action for discovery against a stranger outside the ambit of Order 24 of the RHC and this is made possible under the principle as propounded in the case of Norwich Pharmacal Co and Others v Commissioners of Customs and Excise (1973) 2 All ER 943 At page 943 to page 944(supra) of the report in the case of Norwich Pharmacal, the head note summarises the principle in cogent terms:

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"Held -- The appeal would be allowed and an order for discovery made for the following reasons --

(i) Although as a general rule no independent action for discovery would lie against a person against whom no reasonable cause of action could be alleged, or who was in the position of a mere witness in the strict sense, the rule did not apply where (a) without discovery of the information in the possession of the person against whom discovery was sought no action could be begun against the wrongdoer, and (b) the person against whom discovery was sought had himself, albeit through no fault of his own, been involved in the wrongful acts of another so as to facilitate the wrongdoing. In such circumstances, although he might have incurred no personal liability, he was under a duty to assist the person who had been wronged by giving him full information and disclosing the identity of the wrongdoer."

Even the Norwich Pharmacal principle had been adopted by our Supreme Court in the case of First Malaysia Finance Bhd v Dato' Mohd Fathi bin Haji Ahmad (1993) 2 MLJ 497, and there Edgar Joseph [2003] MLJU 81 at 21 Jr. SCJ delivering the judgment of the Supreme Court aptly said at page 508 of the report:
"A final point needs to be made and it is this: a Norwich Pharmacal Order being an equitable remedy will not be granted as of right even when the requirements for it are satisfied and, so, the court has a discretion as to whether to grant or refuse it."

A submission was made to the effect that the defendant, as the joint venture leader and coordinator of the main contractor, had the necessary knowledge and knew of the identities of the wrongdoers. The defendant also knew of the extent of the wrong doing the wrongdoers have committed and that the defendant would be holding in its possession documents or information which will reveal the same. It was also said that the defendant was in a position to confirm whether payments were in fact made to R&G for the Mechanical Works and, if so, the relevant amounts under interim certificates nos: 22a, 22b and 24b and as well as whether payments were made to R&G for Mechanical Works between February 1998 to July 1998. It was also said that the final amount paid to R&G for the Mechanical Works after the expiry of the defects liability period pursuant to the penultimate certificate was within the defendant's knowledge. Furthermore, it appeared that it was within the defendant's personal knowledge as to how it came about to be in possession of the rubber stamp [2003] MLJU 81 at 22 that was used to stamp on its cheques and that the defendant also knew the identity of the persons who requested the rubber stamp to be utilised. At this juncture, the plaintiff need only to demonstrate that it has a viable cause of action against the wrongdoer and that the discovery which the plaintiff sought for was to enable the plaintiff to know for certain whether it has a cause of action. In P v T Ltd (1997) 4 All ER 200, Sir Richard Scott V.C. aptly said at page 207 of the report:
"So I turn to the question whether he ought to have that discovery. Norwich Pharmacal established the proposition, which had previously been in doubt, that an action in which no more was sought than some particular discovery, necessary to enable the plaintiff to bring an action against some third party might be permissible. The House of Lords held, on the facts of that case, that it was. Lord Reid, in commenting on the ambit of the principle to which he was lending his authority, distinguished the rule that prevents discovery from a person who will be a witness in an action being obtained by a separate action. He said ([1973] 2 All ER 943 at 947-948, [1974] AC 133 at 174):

'To apply the mere witness rule to a case like this would be to divorce it entirely from its proper sphere. Its purpose is not to prevent but to postpone the recovery of the information sought. It may sometimes have been misapplied in the past but I see no reason why we should continue to do so. But that does not mean, as the appellants contend that discovery will be ordered against anyone who can give information as to the identity of a wrongdoer. There is absolutely no authority for that. A person injured

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in a road accident might know that a bystander had taken the number of the car which ran him down and have no other means of tracing the driver. Or a person might know that a particular person is in possession of a libellous letter which he has good reason to believe defames him but the author of which he cannot discover. I am satisfied that it would not be proper in either case to order discovery in order that the person who has suffered damage might be able to find and sue the wrongdoer. Neither authority, principle nor public policy would justify that. So discovery to find the identity of a wrongdoer is available against anyone against whom the plaintiff has a cause of action in relation to the same wrong. It is not available against a person who has no other connection with the wrong than that he was a spectator or has some document relating to it in his possession. But the respondents are in an intermediate position. Their conduct was entirely innocent: it was an execution of their statutory duty. But without certain [2003] MLJU 81 at 23 action on their part the infringements could never have been committed. Does this involvement in the matter make a difference'?"

Continuing further and at page 209 of the report, Sir Richard Scott V.C. remarked :
"It seems to me that in the circumstances of the present case justice demands that Mr P should be placed in a position to clear his name if the allegations made against him are without foundation. It seems to me intolerable that an individual in his position should be stained by serious allegations, the content of which he has no means of discovering and which he has no means of meeting otherwise than with the assistance of an order of discovery such as he seeks from me. It seems to me that the principles expressed in the Norwich Pharmacal case, although they have not previously been applied so far as I know to a case in which the question whether there has been a tort has not clearly been answered, ought to be applicable in a case such as the present."

Further down on the same page, Sir Richard Scott V.C. rounded it up by saying:
"I do not wish to say that I accept the limitation that Mr Pawlak has suggested namely that the Norwich Pharmacal principle should not be applied to discovery of details regarding what one might call ordinary torts. It is true that there is no such case where Norwich Pharmacal has been so applied but there is no such case where Norwich Pharmacal relief has been refused. For my part, I see no reason whatever why the Norwich Pharmacal principle should be regarded as inapplicable to assist a prospective plaintiff to obtain information and documents necessary for the bringing of an action of libel or malicious falsehood in circumstances such as exist in the present case. I am of opinion that this is a case in which justice does require the granting of the relief sought by the notice of motion."

It would be reasonably probable that the plaintiff would have causes of actions against the wrongdoers for the tort of procuring a breach of the sub-sub-contract as well as conspiracy to defraud due to the calculated manouvre or the move to deprive the plaintiff of the monies lawfully due to [2003] MLJU 81 at 24 it. Additionally, it would be apparent that the plaintiff would be able to avail itself of its right in equity in order to trace the payment lawfully due to it or even to find out what had happened based on the information which the plaintiff sought from the defendant. In this connection, reference to the case of Bankers Trust Co. v Shapira and Others (1980) 3 All ER 353 should be made. There Lord Denning MR writing a separate judgment had this to say at page 357 to page 358 of the report :
"Having heard all that has been said, it seems to me that Mustill J was too hesitant in this matter. In order to enable justice to be done, in order to enable these funds to be traced, it is a very important part of the court's armoury to be able to order discovery. The powers in this regard, and the extent to which they have gone, were exemplified in Norwich Pharmacal Co v Customs and Excise Comrs [1973] 2 All ER 943; [1974] AC 133. The customs authorities were perfectly innocent; but they had to disclose the names of infringers of patents whose goods had passed through their hands. Lord Reid said ([1973] 2 All ER 943 at 948, [1974] AC 133 at 175): 'They seem to me to point to a very reasonable principle that if through no fault of his own a person gets mixed up in the tortious acts of others so as to facilitate their wrongdoing he may incur no personal liability but he comes under a duty to assist the person who has been wronged by giving him full information and disclosing the identity of the wrongdoers.' Lord Reid was referring to the views expressed by Lord Romilly MR and Lord Hatherly LC in Upmann v Elkan (1871) LR 12 Eq 140 at 145; 7 Ch App 130 at 133.

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So here Discount Bank incur no personal liability: but they got mixed up, through no fault of their own, in the tortious or wrongful acts of these two men; and they come under a duty to assist Bankers Trust by giving them and the court full information and disclosing the identity of the wrongdoers. In this case the particular point is 'full information'. This new jurisdiction must, of course, be carefully exercised. It is a strong thing to order a bank to disclose the state of its customer's account and the documents and correspondence relating to it. It should only be done when there is a good ground for thinking the money in the bank is the plaintiff's money, as for instance when the customer has got the money by fraud, or other wrongdoing, and [2003] MLJU 81 at 25 paid it into his account at the bank. The plaintiff, who has been defrauded, has a right in equity to follow the money. He is entitled, in Atkin LJ's words, to lift the latch of the bankers' door: see Banque Belge Pour L'Etranger v Hambrouck [1921] 1 KB 321 at 335. The customer, who has prima facie been guilty of fraud, cannot bolt the door against him. Owing to his fraud, he is disentitled from relying on the confidential relationship between him and the bank: see Initial Services Ltd v Putterill [1967] 3 All ER 145 at 148; [1968] 1 QB 396 at 405. If the plaintiff's equity is to be of any avail, he must be given access to the bank's books and documents, for that is the only way of tracing the money or of knowing what has happened to it: see Mediterranea Reffineria Siciliana Petroli SpA v Mabanaft GmbH [1978] Court of Appeal Transcript 816. So the court, in order to give effect to equity, will be prepared in a proper case to make an order on the bank for their discovery. The plaintiff must of course give an undertaking in damages to the bank and must pay all and any expenses to which the bank is put in making the discovery; and the documents, once seen, must be used solely for the purpose of following and tracing the money, and not for any other purpose. With these safeguards, I think the new jurisdiction, already exercised in the three cases I have referred to, should be affirmed by this court."

It must be emphasised that the plaintiff in Bankers Trust Co v Shapira and others (supra) knew of the identities of the wrongdoers and yet the relief claimed was nevertheless granted by the court. Whereas in the present case, the plaintiff knew of the identity of R&G as a corporate entity but it had no knowledge of the actual identities of the individuals or the controlling minds who were responsible for the wrongdoing. The plaintiff too did not know of the identities of the recipients of the payments for the Mechanical Works that were diverted. It is the plaintiff's intention to see these persons in order to trace and recover the payments lawfully due to the plaintiff provided the identities of these [2003] MLJU 81 at 26 persons are disclosed by this court -- so submits the learned counsel for the plaintiff. I hearken to all these submissions. It was pointed out that should the information sought revealed that the directors or officers of R&G as well as the defendant were involved in the wrongdoings, then the plaintiff would be entitled to lift the corporate veil in order to achieve justice notwithstanding the legal efficacy of the corporate structures of R&G and the defendant. In Aspatra Sdn Bhd. & 21 Ors v Bank Bumiputra Malaysia Berhad & Anor. (And Lorrain Esme Osman -- Defendant) (1987) CLJ (Rep) 50, the then Supreme Court spoke of the lifting of the corporate veil in these words (see page 57 to page 58 of the report):
"The remaining two grounds would appear to be inter-related. The lifting of the corporate veil of the appellant companies is intertwined with the issue of the Mareva and Anton Piller orders. It would be observed that the only purpose of going against the appellant companies was to lift the corporate veil so that assets of the companies could be held or deemed to be the assets of Lorrain -- he and the companies having merged with the appellant companies or become interchangeable. There was no dispute that only 32 out of 21,796,395 shares in the appellant companies did not belong to Lorrain. In short he exercised the effective or sole control of the companies by holding more than 99% of the total paid up capital of the 22 appellant companies. Further, he was also a director in 15 of them. These were the main factual basis on which Zakaria J lifted the corporate veil. It must be emphasised that if the learned Judge was correct in lifting the corporate veil, then the extension of the Mareva to the appellant companies and the issue of the Anton Piller order against Aspatra Sdn. Bhd., were merely the consequences of piercing the veil. As adverted to earlier, the object of lifting the corporate veil was to see whether the companies and their share holders were in fact the same entity. This is consistent with what was stated by Lord Wilberforce in Ebrahimi v Westborn Gallery Ltd. [1973] AC 360 @ 379 and quoted with approval by the Privy Council in Tay Bok Choon v Tahansan Sdn. [2003] MLJU 81 at 27 Bhd. (ante) when commenting on the words 'just and equitable' in s. 218(1)(i) Companies Act 1965.Those words '... are a recognition of the fact that a limited company is more than a mere legal entity, with a personality in law of his own: and there is room in Company law for recognition of the fact that behind it, or amongst it, there are individuals, with rights, expectations and obligations inter se which are not necessarily submerged in the company structure'. The Court would generally lift the corporate veil in order to (do) justice particularly when an element of fraud is involved although the consequences of lifting the veil would vary according to the circumstances of each case. Sometimes the consequences may be in favour of the companies and yet at another time they may be against them. (see Palmers Company Law by Schmitthoff 23rd Edn., Vol. I at p. 210). On the evidence before him, we do not think that the learned Judge was wrong in law in piercing the corporate veil of the appellants. The secret profits received by Lorrain were not

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denied on affidavit evidence; only the legal capacity under which Lorrain had received them was being contested. There was admittedly an element of fraud in the receipt of the secret profits whatever might be the capacity in which Lorrain had received them. In our view, this is sufficient for the Court to lift the corporate veil for the purpose of determining whether the assets of the companies are really owned by them as envisaged in Solomon v Solomon [1927] AC 22 and s. 16(5) of the Companies Act, and not merely an abuse of the statutory principle of the companies being separate legal entities from their shareholders and directors. As stated by Cunning-Bruce LJ in Re a Company [1985] BCLC 333-342 CA, where the English Court had lifted the veil in a Mareva situation:

'In our view before and after Wallersteiner v Moir [1974] 1 WLR 991 show that the Court will use its powers to pierce the corporate veil if it is necessary to achieve justice irrespective of the legal efficacy of the corporate structure under consideration.' Although the learned Judge did not say so expressly in his judgment, he in fact found the existence of such an abuse from the very structure of the companies after lifting the corporate veil. Hence his conclusion at pp. 49 to 50 of his judgment that the 'the assets of these 75 companies are the assets of Lorrain'. In short, the learned Judge found that Lorrain was the alter ego of the companies, and the assets of the appellant companies are in fact and in law Lorrain's assets."

That was the speech of that brilliant judge Mohd Azmi SCJ and his Lordship continued to say at page 59 of the report in regard to the Anton Piller order in these salient words :
"An Anton Piller order which derives its name from the case of Anton Piller K.G. v Manufacturing Process Ltd. [1976] 2 WLR 162-168 CA was first reported in [2003] MLJU 81 at 28 this country in Lian Keow Sdn. Bhd. v C. Paramjothy & Anor. [1982] 1 MLJ 217, where in a claim for land held in trust for the plaintiff, Yusof Abdul Rashid J granted the order because there was a serious danger on the first defendant destroying the trust deed and file relating to the said land. In this appeal, the Anton Piller order was issued against Aspatra in aid of the Mareva injunction, and Mr. Krishnan contended that there was no authority for the proposition that it could be granted in respect of documents which did not form the subject matter of the claim. In Yousif v Salama [1980] 3 All ER 405 CA, the English Court of Appeal held that the Court had a discretion to grant an Anton Piller order to enable the preservation of a document which did not itself form the subject matter of the action, where (per Lord Denning MR) the document was the best possible evidence and the plaintiff genuinely feared that the defendant would destroy it prior to the hearing of the action, or where (per Donaldson LJ) there was a very clear prima faciecase leading the Court to fear that the defendant would conceal or destroy essential evidence and that to do so would deprive the plaintiff of any evidence on which to put forward his claim and so frustrate the process of justice, or where (per Brightman LJ) there was prima facie evidence that essential documents were at risk. Again in Emanuel v Emanuel [1982] 1 WLR 669-679 in a motion for ancillary relief in divorce proceedings, the Anton Piller order granted by Wood J extended to documents which were not strictly related to maintenance, the subject-matter of claim. It even extended to all documents relating to the sale by the first respondent and the proceeds of sale of shares in any company and of any capital assets. In the headnote of CBS United Kingdom Ltd. v Lambert & Anor. [1982] 3 All ER 237-243 CA it was held:

'In the circumstances it was a clear case for the Court to order discovery of assets and delivery up pending trial of a particular kind of asset because there was reason to believe that the defendant had put such profits as he had made from infringing the plaintiffs' copyrights into easily removable and disposable chattels such as motor vehicles, and, since he claimed to be unemployed, there was no reason to think that he used the motor vehicles for the purposes of earning his living or that he and his wife would suffer hardship if an order for their delivery up were made. Moreover, the possibility of self-incrimination on the charge of handling stolen property was not in the circumstances a bar to ordering discovery. It followed therefore that the Court would allow the appeal, grant the order sought and order the defendant and his wife to disclose the value, nature and whereabouts of their assets, including bank and other accounts, and to deliver up, pending trial, the motor vehicles in their possession, to be kept in a garage chosen by the plaintiffs' solicitors.' In the instant case the corporate veil having been properly lifted and Lorrain having been exposed as the alter ego of Aspatra, it became necessary to identify all assets within jurisdiction owned by Lorrain. The order in terms granted by the learned Judge, extensive though it might be, was necessary as it was an aid to justice as far as BBMB and BMF were concerned. Mr. Krishnan also complained that there was no evidence of Lorrain's misconduct to justify the issue of the Anton Piller order. We did not think so. Lorrain's conduct was material in this case not only in regard to the granting of Mareva injunction but also the Anton [2003] MLJU 81 at 29

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Piller order, and this factor had been rightly and sufficiently considered by the learned Judge."

Without a doubt, the act of utilising rubber stamps different from the designated ones in order to stamp its cheques to R&G, Henz Construction had clearly facilitated the diversion of payment lawfully due to the plaintiff from the joint bank account. Although the utilisation of rubber stamps other than the ones designated seems to infer that the plaintiff had seemingly derogated in its duty or responsibility, yet it does not bar this court from granting the application in enclosure 6. Lord Reid expressed it better in the Norwich Pharmacal's case, particularly at page 948 to page 949 of the report :
"My noble and learned friends, Lord Cross of Chelsea and Lord Kilbrandon, have dealt with the authorities. They are not very satisfactory, not always easy to reconcile and in the end inconclusive. On the whole I think they favour the appellants, and I am particularly impressed by the views expressed by Lord Romilly MR (1871) LR 12 Eq 140 at 145 and Lord Hatherley LC (1871) 7 Ch App 130 at 133 in Upmann v Elkan. They seem to me to point to a very reasonable principle that if through no fault of his own a person gets mixed up in the tortious acts of others so as to facilitate their wrongdoing he may incur no personal liability but he comes under a duty to assist the person who has been wronged by giving him full information and disclosing the identity of the wrongdoers. I do not think that it matters whether he became so mixed up by voluntary action on his part or because it was his duty to do what he did. It may be that if this causes him expense the person seeking the information ought to reimburse him.But justice requires that he should co-operate in righting the wrong if he unwittingly facilitated its perpetration. I am the more inclined to reach this result because it is clear that if the person mixed up in the affair has to any extent incurred any liability to the person wronged, he must make full disclosure even though the person wronged has no intention of proceeding against him. It would I think be quite illogical to make his obligation to disclose the identity of the real offenders depend on whether or not he has himself incurred some minor liability. I would therefore hold that the respondents must disclose the information now sought unless there is some consideration of public policy which prevents that."

[2003] MLJU 81 at 30 In my judgment, the information, records and documents sought from the defendant are certainly of crucial importance to the tortious causes of actions which the plaintiff may have against the wrongdoers. It is purely in the interests of justice that these items are and should be made available to the plaintiff. It would be appropriate, at this juncture, to reproduce the sage words of Lord Mackay of Clashfern in O'Sullivan v Herdmans Ltd (1987) 3 All ER 129, 136:
"In my opinion, there is no factor present in the circumstances of this case which would indicate that it would be just to refuse to exercise the power and there are strong factors in favour of the exercise of the power. If the case goes to trial it is obviously in the interests of justice that these documents of central importance should be available to both parties before the trial starts so that the jury may be given a fair impression of the central issues from the beginning. To force the defendants to refuse to deploy its full position in cross-examination until the stage is reached at which these documents would be available to it under a subpoena duces tecum would not be in any way in the interests of justice. Further the early production of these documents may well affect the course of the litigation before the trial. It may lead the defendants to consider a settlement of the action and it certainly will enable the medical advisers and the legal advisers of the defendants to appreciate the real issues in the case when they are preparing for trial. The interests of justice are, in my opinion, served by the promotion of settlements rather than the prolongation of litigation and by the possibility of early, complete preparation for both parties to a trial rather than by obliging one party to delay its full preparation until after the trial has actually started."

Now, it is a well known fact that the KLCC Project has been fully completed. KLCC is now in operation. The business of Henz Construction had ceased on 30.11.2000 as reflected in exhibit "CKN-1" of enclosure 5. The potential advantage of the said Order in favour of the plaintiff outweighs any detriment that might befall the defendant. The plaintiff [2003] MLJU 81 at 31 should be entitled to the said Order as sought for in enclosure 6 and I made that Order accordingly as seen in enclosure 13. The said Order has been extracted and it can be seen in enclosure 13. The said Order is rather long. I need only to refer to the salient portions of that Order. By way of paragraph (1) of the said Order, the defendant by its authorised officer -- Mr. Charles Ray Morgan

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and/or Mr. Patrick Mitchell, is directed to set forth and disclose to the plaintiff in a list verified by affidavit within seven (7) days from the date of service of the said Order the particulars as set forth in paragraphs 1.1.to 1.6 therein. Of pertinence would be paragraph (2) of the said Order where the defendant is directed whether by itself or by its directors, officers, servants, employees or agents or by any person appearing to be in charge of the premises to:
".....allow supervising solicitors together with up to 4 other persons duly authorized by the Plaintiff and the Plaintiff's solicitors (the 'Aforesaid Persons') at any hour between 8.00 a.m. and 5.00 p.m. on any week day, except public holidays and upon the service of this Antor Piller Order on them, to enter the Premises and any vehicle in the Premises forthwith and search for, inspect, photograph, make copies and removing and taking into custody of the Plaintiff's solicitors all documents or articles and/or their duplicate which are listed and [2003] MLJU 81 at 32 shown in Schedule 2 herein (the 'Listed Items') and to access any computers in the Premises to find, examine, take photographs, print out and/or make copies (including softcopy of any electronic documents found in the computers) of the documents or articles in Schedule 2."

Then by way of paragraph (3) of the said Order, it is stipulated that:

"...the Defendant or any person managing the Premises allow the aforesaid persons to be present in the Premises until completion of the tasks above and if necessary, to enter the Premises again on the same day or the next day to complete the tasks in paragraph 2 above."

While paragraph (4) of the said Order states as follows:

"That the Defendant or any person appearing to be in charge of the Premises do immediately upon service of this Anton Piller Order upon them:-

4.1 surrender to the solicitors for the Plaintiff all original documents and copies thereof as contained in Schedule 2 in their possession, custody or control; and 4.2 inform the solicitors for the Plaintiff the nature, location and information of the Listed Items, whether in the Premises or any other place including those held for them by any persons."

Paragraph (6) of the said Order stipulates as follows:

"That, except for purposes of obtaining legal advise, the Defendant whether by itself or by its directors, officers, servants, employees or agents or by any other manner be restrained from directly or indirectly informing anyone of these proceedings or of the contents of the Order, or from warning anyone that that proceedings have been or may be brought against them by the Plaintiff until further order or hearing."

And paragraph (7) of the said Order provides as follows:

"That save as otherwise provided by the order and that the Defendant is at liberty to carry on its ordinary business, an injunction restraining or preventing the [2003] MLJU 81 at 33 Defendant, whether by itself, directors, officers, servants, agents or any of them respectively or otherwise from destroying, hiding and/or concealing documents listed in Schedule 2 until further direction or hearing."

The indorsement to the said Order reads as follows:

"INDORSEMENT PURSUANT TO ORDER 45 RULE 7 RULES OF THE HIGH COURT, 1980

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If the Defendant, Harbert International Est. Sdn. Bhd. (Company No. 357606-K) disobeys this order requiring them by the duly authorized officers to forthwith set forth and disclose to the Plaintiff in a list verified by Affidavit within 7 (seven days) from the date of service of this Order the particulars sought in paragraphs 1.1 to 1.6 above and allow supervising solicitors together with up to 4 other persons duly authorized by the Plaintiff and the Plaintiff's solicitors to forthwith enter the premises in Schedule 1 annexed hereto for the reasons specified in paragraph 2 above and neglect to obey paragraphs 3 to 8 above and if the Defendant neglects to do the acts specified therein, you, Charles Ray Morgan, Patrick B. Michell, Billy L. Harbert and R. Alan of the Defendant will be liable to process of execution for the purpose of compelling the Defendant to obey the same."

That would be in the nature of a penal notice and it is crucial to issue such a penal notice. In the words of Donaldson MR in Williams v Fawcett (1985) 1 All ER 787 at 789:
"It must be issued at the time when the order or judgment is drawn up if that order is in the nature of an injunction....."

In the "The Vanda" (1960) 26 MLJ 283, the Court of Appeal refused to enforce the order simply because the order did not contain any penal notice. It is pertinent to point out that in the case of an Anton Piller order it is usually served on the person in charge of the premises concerned [2003] MLJU 81 at 34 and the penal notice should also make reference to that person being so served. Speaking generally, it is sufficient to say that for an order to be enforceable against that person, the person should be named or identified or reference should be made to him in the penal notice. Failure to comply with the said Order From the relevant affidavits it is quite apparent that the defendant has not complied or fully complied with the said Order and this seems to be the submission of the learned counsel for the plaintiff. It is submitted that despite the clear terms of the said Order and the consequences of noncompliance as stipulated in the indorsement to the said Order, the defendant has exhibited a blatant disregard for the said Order. The chain of events as set out in the affidavits reflect as to what had happened since the service and attempted execution of the said Order on the defendant on August 8, 2002 until August 19, 2002. It would be pertinent to say that the chain of events from August 8, 2002 until August 12, 2002 are clearly set out in the affidavits marked as enclosures 17, 20 and 23. While the events that took place from August 13, 2002 until August 19, 2002 are compendiously narrated in the affidavits [2003] MLJU 81 at 35 marked as enclosures 21 and 22. These affidavits certainly make for interesting reading materials. For clarity, I shall now attempt to piece together the story. August 8, 2002, a Thursday -- the first attempt The plaintiff's representative together with Mr. Ong Chee Kwan ("Ong") and Mr. Danny Yap Sin Leng, the supervising solicitors from the law firm of Messrs Lee Ong & Kandiah who were appointed to oversee the execution of the said Order and Mr. Brian Cumming ("Brian") from the law firm of Messrs Tay & Partners, the solicitor for the plaintiff, were present at the defendant's premises at the 23rdfloor, UBN Tower, 10 Jalan P. Ramlee 50200 Kuala Lumpur (hereinafter referred to as the "said premises"). This was on August 8, 2002, between 9.45 a.m. to 1.30 p.m. and it was for the purpose of executing the said Order. Incidentally, the said premises is one of the premises identified in Schedule 1 of the said Order. Now, at that time the defendant was represented by its managing director in the person of Mr. Patrick Mitchell ("Patrick") and he arrived at the said premises at about 10.47 a.m. while the defendant's solicitor by the name of Mr. Gideon Tan ("Gideon") arrived at about 11.55 a.m. accompanied by several of his [2003] MLJU 81 at 36 assistants from the law firm of Messrs Gideon Tan Razali Zaini. After serving the said Order on the defendant and explaining the purpose of his visit and the terms of the said Order to Patrick, Ong requested

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to search the premises. But Ong's request was flatly refused by Patrick and Gideon on the grounds that the documents listed under Schedule 2 were not in the said premises but rather stored at another location and that the person in charge who is said to be in possession of the inventory lists of the relevant documents and boxes, namely, Patrick's secretary was on leave until Monday, August 12, 2002. Gideon stated that in as much as his client wants to, they are unable to physically comply with the said Order and he promised that he would issue a written confirmation on his legal firm's letter head to the effect that the documents listed under Schedule 2 of the said Order were not in the said premises. Gideon in due course gave that written confirmation as seen in exhibit "PM 1" of enclosure 14. Gideon then suggested that the parties reconvene at the said premises on August 12, 2002 at about 3.00 p.m. Ong did not remain idle. He explained that although the defendant asserts that the documents under Schedule 2 of the said Order are not in the [2003] MLJU 81 at 37 said premises, yet the plaintiff need not accept that explanation since the said Order allows for a search to be carried out and that if the defendant does not allow the search to be conducted at the said premises, then Patrick would risk committal proceedings. Despite the explanations advanced by Ong, both Patrick and Gideon stood to their grounds and the defendant refused to allow the plaintiff to search the said premises. Gideon even said that the plaintiff may proceed with the committal proceedings if it so wishes and Gideon further said that the said Order is not a search warrant which entitles the plaintiff to search the said premises without the defendant's consent. Ong, once again, alerted Patrick that he risks committal proceedings being brought against him as a result of his refusal and Patrick replied, "You do what you have to do. " Upon request, Patrick then provided the name and address of the store where the documents were kept and it was at Recall Total Information Management, Lot 36545, Block "B", Jalan TS 6/5, Taman Perindustrian Subang, 47510 Subang Jaya ("Recall"). Ong then enquired of Patrick whether the defendant would furnish the plaintiff with an authorisation to conduct a search at Recall which search would fall within the ambit of Schedule 1 of the said Order. But both Gideon and Patrick confirmed that the defendant was not agreeable to authorise the plaintiff to conduct any [2003] MLJU 81 at 38 search at Recall even though the said Order allows the plaintiff to do the same. So, with all these impediments, the plaintiff's representative and its solicitor together with the supervising solicitors left the said premises at about 1.30 p.m. without conducting any search. It would be appropriate to state that the full details of the events on August 8, 2002 are vividly set out in the affidavit in enclosure 20 particularly at paragraphs 7.1, 7.2, 7.3, 7.4, 7.5, and 7.6. Another affidavit to reckon with would be in enclosure 17 which is the affidavit of Ong -- the supervising solicitor in that search, and his affidavit too is enclosed and annexed as exhibit CKM-2 to enclosure 20. Reference to paragraphs 23, 24, 26, 27, 28, 30, 31, 32, 33, 34, 36, 37, 38, 39, 40, 41 and 42 of the affidavit in enclosure 17 are highly recommended. It was submitted that the outright refusal by the defendant to allow the search to be carried out at the said premises and at Recall was in clear violation of the clear words of paragraph (2) of the said Order. [2003] MLJU 81 at 39 August 10, 2002, a Saturday Enclosure 16 was filed by the defendant's solicitors seeking, inter alia, to set aside the said Order August 12, 2002, a Monday --the second attempt The letter dated August 9, 2002 from Messrs Tay & Partners addressed to Messrs Gideon Tan Razali Zaini as exhibited and annexed as exhibit "PM-5" of enclosure 14, inter alia, alluded to the following set of facts at page 2 thereof:

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"As the said Ms. Loh (referring to Patrick's secretary) would have returned from leave by then, we wish to put you on notice that our client will visit your client's premises at 9.30 a.m. on Monday 12, August 2002 for a second attempt at enforcing the Anton Piller Order and would appreciate it if you and your client would take the opportunity to immediately purge the contempt failing which we have instructions to initiate committal proceedings without further reference. The Anton Piller Order is for the purpose of assisting our clients in ascertaining and/or identifying tortfeasors which our clients have reasons to believe have caused them losses estimated to be in the region of RM78 million. We trust you will advise your client accordingly and look forward to mutual cooperation from all parties concerned."

And so in pursuance of that letter, Ong, Eric Siow Kin Seong who were from Messrs Lee Ong & Kandiah, the supervising solicitors and Ms. Ng Pek Wan ("Ng") who was from the law firm of Messrs Tay & Partners, the [2003] MLJU 81 at 40 plaintiff's solicitors, together with three other duly authorised representatives of the plaintiff arrived at the said premises at 10.00 a.m. for the second attempt at executing the said Order. The defendant was represented by Patrick and Ms. Chin Yin Choi ("Chin") from the law firm of Messrs Gideon Tan Razali Zaini, the defendant's solicitors. Patrick then confirmed that his secretary was back from her leave and that she is presently reviewing the inventory lists in order to identify the relevant boxes at Recall. So, Ong requested for all the inventory lists of the documents/boxes stored at Recall to be disclosed to the plaintiff for their examination so that the plaintiff could ascertain and identify the relevant boxes within Schedule 2 of the said Order. Chin replied and she said that the defendant would not allow the plaintiff to have sight of all the inventory lists and that the defendant would only allow the plaintiff to have sight of those that have been identified by the defendant to be relevant. Ong then reminded the defendant that the said Order allowed the plaintiff to peruse all the inventory lists in order to determine which of the boxes are relevant but Chin persisted in her stand and she steadfastly refused to allow the plaintiff to peruse all the inventory lists. [2003] MLJU 81 at 41 At about 12.20 p.m., Patrick and Chin informed the supervising solicitors and the plaintiff's solicitor that the defendant has identified 45 boxes which are within Schedule 2 of the said Order. Another 46 boxes also have been identified and they are within Schedule 2 of the said Order and they also allowed the plaintiff's representatives and/or their agents to peruse through the inventory lists to the 91 boxes. Chin then stated that the defendant would ask Recall to deliver the 91 boxes to the said premises and that the defendant would go through the documents contained therein and the defendant would only disclose to the plaintiff the documents which the defendant has ascertained to be within Schedule 2 of the said Order. Ong then proceeded to explain to Patrick that there would be documents which are clearly within Schedule 2 of the said Order. Ong too explained that where there are doubts as to whether the documents are within Schedule 2 of the said Order then his role as a supervising solicitor would be to peruse through the controversial documents and form an opinion as to whether those documents are within Schedule 2 of the said Order and if there are further disputes, directions would then have to be obtained from the court. Ng joined in the affray. She then explained to Chin that the plaintiff takes the position that the plaintiff is entitled, as of right, to search for the documents as reflected in Schedule 2 of the said Order at Recall and that if [2003] MLJU 81 at 42 the defendant arranges for the documents to be delivered to the said premises that would be the defendant's decision which the plaintiff would not accept as full compliance with the said Order. Ng then proceeded to inform Patrick and Chin that the plaintiff requires to search the defendant's computers at the said premises for soft copies of the documents within the ambit of Schedule 2 of the said Order, in particular, in accordance with paragraph (2) of the said Order. Patrick responded and he said that all the documents have been copied into CD-ROMs and have been deleted from the hard disks of the computers in the said premises and that he believed that the CD-ROMs have also been stored at Recall. Ong reiterated and he said that the disputed documents would be perused by him with the assistance of Patrick and Ong who would then decide whether the contents of those documents are within Schedule 2 of the said Order.

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Ng reiterated that the plaintiff requires to go to Recall to search for documents within Schedule 2 of the said Order. Ng also informed the defendant that the plaintiff requires to search the said premises as well as the defendant's computers that are found in the said premises. But unfortunately these requests were not entertained by the defendant and Chin categorically stated that none of the documents within Schedule 2 of the said Order are kept on the said premises. [2003] MLJU 81 at 43 At about 1.30 p.m. on August 12, 2002, Patrick brought along four (4) ring binder files and he said that they contained the inventory lists of all the defendant's documents that were stored at Recall. Patrick was kind enough to allow the plaintiff's representatives to peruse through the four (4) ring binder files. At about 3.25 p.m. on August 12, 2002, Mr. Yap Wai Ming ("Yap") from Messrs Tay & Partners, the plaintiff's solicitor, arrived at the said premises. And at about the same time, Patrick announced that the CD-ROMs had been found at the said premises and that the lists of all the files contained therein were being printed and would be furnished to the plaintiff in due course. Patrick also announced that the computers at his office could not be used to read the electronic files because they were of "Lotus-123" files which were said to be old and no longer being used in his office. Yap enquired whether the plaintiff's representatives could sit with the defendant if they are going through the lists in the CD-ROMs, but unfortunately, this was flatly refused by Patrick. The latter then declared that the defendant had directed Recall to deliver the ninety-one (91) boxes to the said premises and that at least ten (10) of the boxes would be delivered by that day -- meaning August 12, 2002. [2003] MLJU 81 at 44 Once again Ng requested for permission to search the said premises for documents within Schedule 2 of the said Order but Chin refused to accede on the grounds that none of the documents within Schedule 2 of the said Order are found at the said premises. It would be apparent that the defendant has chosen to blatantly disregard paragraph (2) of the said Order by refusing to allow the plaintiff to search: (i) (ii) (iii) the said premises; particularly the computers at the said premises; and at Recall,

for documents within Schedule 2 of the said Order. Instead the defendant saw it fit to dictate the terms of the execution of the said Order. At about 3.50 p.m. on August 12, 2002, Mr. Ramid Khan bin Rahman Khan ("Ramid") and Brian from Messrs Tay & Partners, the plaintiff's solicitors, arrived at the said premises and they relayed the message that the hearing of enclosure 16 which was fixed on that morning -- referring to August 12, 2002, had been adjourned to August 20, 2002. Incidentally, Gideon and Ms. Syamsuriatina Ishak ("Tina") from Messrs Gideon Tan [2003] MLJU 81 at 45 Razali Zaini had arrived at the said premises shortly before Ramid and Brian. A brief meeting then took place between Ramid, Yap and Gideon. In that meeting, it was agreed, at the request of Gideon and in the interest of executing the said Order, that the supervising solicitors known as Messrs Lee Ong & Kandiah be replaced with the new supervising solicitors known to both parties and that a search of the contents of the ten (10) boxes from Recall already at the premises be conducted on August 13, 2002 upon the arrival of Mr. Alex De Silva ("Alex") and/or his partner by the name of Mr. P. Theyakaraja ("Raj") from Messrs Raj & De Silva -- the new supervising solicitors that were agreed to by both the parties. It must be noted that the change of the supervising solicitors was merely to accommodate the defendant's request and at the same time to facilitate the execution of the said Order and these were without any admission whatsoever as to the independence of Messrs Lee Ong & Kandiah as seen and as set out in the letter from Messrs Tay & Partners dated August 13, 2002 as reflected in exhibit "CKM-5" of enclosure 20. The plaintiff's solicitors and their representatives then left the said premises without conducting any search whatsoever. It must be emphasised that the full details of the events that took place on August 12, 2002 can

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be seen in enclosure 20 at paragraphs 8.2, [2003] MLJU 81 at 46 8.3, 8.4, 8.5 and 8.6 thereto as well as in enclosure 23 at paragraphs 8 to 44 thereat. August 13, 2002, a Tuesday The plaintiff's representatives in the persons of Yap and Alex who were the new supervising solicitors as agreed to by both the parties arrived at the said premises at approximately 9.35 a.m. At about 9.50 a.m., Mr. Rizal Zulkeply ("Rizal") and Tina -- the defendant's solicitors, arrived at the said premises while Patrick arrived at about 10.15 a.m. Gideon arrived shortly thereafter. At approximately 10.30 a.m., Patrick and the defendant's solicitors notified the plaintiff's representatives that Patrick will lead them around the office with a caveat to the effect that the plaintiff's representatives were not allowed to touch anything. Patrick also declared that he would only permit the plaintiff's solicitors but not the other representatives to look at the files in the said premises. That was indeed interesting. [2003] MLJU 81 at 47 Now, while going through one of the rooms which Patrick said was occupied by his secretary and an accountant, the plaintiff's representatives found several arch lever files on the open shelves pertaining to the KLCC project.An inspection of those files were undertaken, it yielded some success. The plaintiff's representatives pointed out to Yap to two letters from Radio & General Engineering Sdn Bhd ("R&G") to Henz Construction addressed to Mr. Charles Ray Morgan-- the then project manager of Henz Construction regarding a change in payment instructions and in regard to rubber stamps. These two letters are annexed as an exhibit "CKM-6" to enclosure 20. The plaintiff's representatives then requested for a copy and this was duly complied with. But the plaintiff's representatives were not allowed to search the account files relating to the Henz construction's payments. The accountant then revealed that there were 6 CD-ROMs which were stored in the locker of her desk. The plaintiff's representatives -- quite naturally, requested to inspect the contents of the 6 CD-ROMs. But Patrick refused to allow the inspection on the grounds that most of the contents contained confidential information which were unrelated to the said Order and that although there may be files in the 6 CD-ROMs which were related to the said Order, Patrick was still adamant and he did not allow the plaintiff [2003] MLJU 81 at 48 to have access to the 6 CD-ROMs. Alex then proceeded to advise Patrick to the effect that he -- Patrick, should allow the plaintiff access to the 6 CD-ROMs and that any refusal to allow access may be interpreted as a violation of the terms of the said Order for the simple reason that the plaintiff would not be in a position to ascertain whether the information stated therein would be within the ambit of the said Order or otherwise. But Patrick stood to his ground and he refused to waive. Not only that, the defendant's solicitors also refused to allow the plaintiff to have custody or access to the 6 CD-ROMs despite Alex's advice. It was submitted on behalf of the plaintiff that these refusals contravened paragraph (2) of the said Order, which Order allows the plaintiff access to any computers in the said premises and to inspect and make copies thereof including soft copies of the items in Schedule 2 therein. At Patrick's room, the plaintiff's representatives made a search and they saw a "Recall" box on the shelf of the cabinet in his room. The plaintiff's representatives then requested to search the files in the "Recall" box but Patrick refused to allow them and he claimed that the files contained confidential information relating to the financial statements and accounts of the defendant's partners and that those files were not relevant to the said Order even though they may contain the costs and the figures of the KLCC [2003] MLJU 81 at 49 Project Air Conditioning Mechanical Ventilation Works ("Mechanical Works") which would be covered by the said Order. Alex then advised Patrick that he ought to allow the plaintiff access to the "Recall" box and the folders and that any refusal may be interpreted as being in violation of the said Order since the plaintiff would not be in a position to ascertain whether the information contained therein would be within the said Order. Despite this, Patrick refused to budge and he flatly refused to allow a search of the contents of the "Recall"

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box and the files. A further examination of Patrick's room revealed seven (7) other arch lever files in one of the cabinets behind his desk. Patrick also claimed that the contents of the seven (7) files contained confidential information relating to the KLCC project and that they were similar to the contents of the "Recall" box which he had earlier refused inspection. Patrick was very adamant and he refused to allow the plaintiff to inspect the seven (7) files. It is apparent that the search of the said premises proves that the defendant's claim on August 8, 2002 and confirmed by the letter from its solicitors dated August 8, 2002 as reflected in exhibit "PM-1" of enclosure 14 that none of the documents in Schedule 2 of the said Order was on the said premises, were clearly without foundation. [2003] MLJU 81 at 50 Upon completion of the search of the said premises, all those present then gathered at the room where the ten (10) Recall boxes that were delivered on August 12, 2002 were kept. A discussion then ensued in regard to the mode and procedure wherein the ten (10) boxes were to be inspected by the plaintiff's representatives. But, unfortunately, the parties were at loggerheads and they did not agree on an acceptable mode until very much later in the afternoon. It was only at about 4.05 p.m. on August 13, 2002 that the inspection of the first of the Recall boxes commenced. It would be germane to mention that the details of the events that transpired on August 13, 2002 can be seen in enclosure 21 at paragraphs 4 to 13.1 thereto and in enclosure 22 at paragraphs 4 to 18 thereat. August 14, 2002, a Wednesday At 9.30 a.m., the plaintiff's representatives arrived at the said premises and they enquired as to when would the 81 boxes identified by the defendant on August 12, 2002 would arrive. Patrick retorted that those 81 boxes would not be arriving on that day because Recall did not have sufficient lorries to deliver them. The plaintiff's representatives then suggested to Patrick that they could make alternative transportation [2003] MLJU 81 at 51 arrangements to have the 81 boxes collected from Recall to be delivered to the said premises accompanied by the defendant's representatives or its solicitors in order to speed up the inspection. The plaintiff's representatives also suggested that an additional photocopier be brought to the said premises in order to speed up the photocopying of the relevant documents and it was also suggested that more of the boxes ought to be opened at any one time in order to speed up the inspection process. But, alas, all these suggestions were rejected by Patrick and the defendant's solicitors and they insisted that only one box will be opened at any one time. It is apparent that the defendant is dictating the terms of the execution of the said Order and is seeking to delay the inspection process pending the hearing of enclosure 16 on August 20, 2002. At the behest of the defendant there was a break for lunch and so the inspection was abruptly stopped. At about 3.15 p.m. requests to take photographs of the documents at the conference room where inspection was underway and to record the inspection process on camera were denied. Patrick did not allow photographs to be taken because he did not want to be "incriminated in any way" and that "the photographs may be used against him later. " [2003] MLJU 81 at 52 It is germane to mention that the details of the events which transpired on August 14, 2002 can be seen in paragraphs 19 to 35 of enclosure 22 and at paragraphs 14 and 14.1 of enclosure 21. August 15, 2002, a Thursday Mr. Chan Kwai Moon ("Chan"), Mr. Chris Loke ("Chris"), Mr. Tay Chung Sen ("Tay") and Mr. Tan Jiann Jiong ("JJ") who are the duly authorised agents of the plaintiff arrived at the said premises at about 9.00 a.m., while Patrick arrived at the said premises at about 9.11 a.m. A request was then made to commence work in identifying the documents but Patrick declined to accede until the defendant's lawyer by the name of Chin

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from the law firm of Messrs Gideon Tan Razali Zaini arrives. Chin arrived at the said premises at 9.35 a.m. and she then proceeded to meet Patrick behind closed doors. At 9.55 a.m., both Chin and Patrick entered the conference room and they stated that they wanted to continue listing all the agreed documents before opening another box. Chris, Tay and JJ commenced listing and Patrick then left the conference room as there was nothing for him to check at that time. It must be mentioned that two (2) boxes containing eight (8) files have been checked and approved by Patrick [2003] MLJU 81 at 53 and that seven (7) files had to be listed by the plaintiff's representatives in the presence of Chin prior to the photocopying. At about 10.10 a.m., Chan enquired as to the progress of retrieving further boxes from Recall. Chin responded and said that those boxes would arrive sometime in the afternoon. By 10.25 a.m. Chin had perused and verified the listing of one file compiled by Rizal and she then gave the green light for photocopying. Chin then proceeded to list a new file at about 10.30 a.m. The photocopying of the list verified earlier was completed at 11.10 a.m., and Chan then proceeded to collect them and left the said premises in order to return to the plaintiff's solicitor's office of Messrs Tay & Partners. Upon arrival at the office of Messrs Tay & Partners, which was at about 11.30 a.m., Chan then proceeded to compare and mark out the photocopies that were made against the Schedule from Recall. At about 12.40 p.m., Chris telephoned Chan to relay the message that 25 boxes from Recall had just arrived at the said premises. However, Chan remained at the office of Messrs Tay & Partners until early afternoon. At approximately 4.00 p.m., Chan arrived at the said premises and he proceeded to ask Tina for particulars of the boxes which arrived on that day and he was furnished with a list which contained the bar code numbers of the boxes. Chan then [2003] MLJU 81 at 54 sat at the reception area of the said premises-- away from the conference room where the listing was being carried out. Chan did not remain idle. He proceeded to compare the contents in the list that was handed to him by Tina with the contents as reflected in the photocopies of the Recall storage cards.At approximately 4.40 p.m., Chan was requested to leave the said premises by Patrick since there were already four (4) representatives of the plaintiff in the conference room. Chan complied and he then left immediately. August 16, 2002, a Friday The remaining 56 out of the 81 boxes from Recall finally arrived at the said premises and they were numbered from numbers 26 until 81 by the defendant. The numbering was done in accordance with the way they were stacked. Patrick consulted his joint venture partners and attorneys and he then informed the plaintiff's representatives as well as Alex that the defendant has decided not to allow the plaintiff to make any copies of documents found in approximately 45 boxes containing correspondences and documents between Henz Construction and KLCC even though they may relate to the Mechanical Works which clearly fell within Schedule 2 of the said Order. [2003] MLJU 81 at 55 Patrick asserted that the defendant's stand was that the defendant was not obliged to allow inspection and making of the copies of documents between Henz Construction and R&G and that the plaintiff would only be allowed to have a cursory look at the contents of the 45 boxes and make short notes if the plaintiff wanted to but the plaintiff would not be allowed to make copies nor take any photographs of the 45 boxes. Alex advised Patrick that the defendant was obliged to consider allowing the plaintiff to make copies of any documents which the plaintiff thought would be relevant; but Patrick was still adamant and he refused to allow any copies to be made of the contents of the 45 boxes. Later, on the same day, the position became worse. The defendant altered its stand and refused to allow the plaintiff's representatives to make any notes whatsoever of any of the documents found in the 45 boxes. However, the plaintiff was allowed to make copies of the letters addressed directly to or from R&G only. But the plaintiff was refused permission to make copies of the letters carbon copied to R&G.

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The request from the plaintiff's representatives that the boxes from Recall should be inspected in accordance with their priority as determined [2003] MLJU 81 at 56 by the plaintiff's representatives was not entertained by the defendant. The defendant's solicitors insisted that the boxes could only be inspected in accordance with the numbers written randomly on them and according to the manner in which they were stacked. It would be interesting to note that the details of the events that took place on August 16, 2002 can be seen in paragraphs 41 to 58 of enclosure 22 and in paragraphs 18 to 22.2 of enclosure 21 thereto. It is the submission of the plaintiff that the arbitrary terms dictated by the defendant as to what documents can be sighted or otherwise and the order for inspection of the boxes are clearly beyond the purview of paragraph (2) of the said Order. It is emphasised that the said Order allows the plaintiff to, inter alia, search, inspect and make copies of the documents within Schedule 2 of the said Order. It is further submitted that by consulting its joint venture partner, the defendant has breached paragraph (6) of the said Order which prohibits the defendant from warning anyone in regard to the proceedings herein except for the purposes of obtaining legal advice. [2003] MLJU 81 at 57 August 19, 2002, a Monday The scenario was still the same. The defendant and its solicitors still persisted in its tough stand in regard to the documents between Henz Construction and KLCC and the order of inspection of the boxes. It seems that the plaintiff has acted reasonably to the extent of agreeing to change the supervising solicitors in order to accommodate the defendant's request; yet the defendant has continued to stall the inspection process and has not complied with the said Order. Failure of the defendant to comply with the said Order It would be tedious in the extreme to set out in detail the events of non-compliance of the said Order by the defendant. From the recital of the events that took place as alluded to above, it can be surmised that the defendant's conduct and the conduct of the defendant's solicitors may be described in one word. Unreasonable. After the service of the said Order onto the defendant on August 8, 2002, the defendant has only partially complied with the said Order by [2003] MLJU 81 at 58 permitting the plaintiff a limited search of the defendant's premises on August 13, 2002. As demonstrated, unnecessary obstacles were created by the defendant and its solicitors. It was strenuous in the extreme. Contemptuous conduct of the defendant The following events speak volumes for the plaintiff and it places the defendant in a difficult position. These events may conveniently be classified as illustrations of the contemptuous conduct on the part of the defendant. I will now proceed to identify those events: (1) (2) (3) (4) Refusal by the defendant to permit a search and to review the 6 CD-ROMs on 13.8.2002. Refusal by the defendant to permit a review of the "Recall" box and six other files found in Patrick's room on 13.8.2002. Refusal by the defendant to permit a search and inspection of the existing accounting files related to KLCC found in the accountant's room on 13.8.2002. The defendant lied about the non-availability of documents covered under the said Order during the visit to the said premises on 8.8.2002 -- which was even subsequently confirmed in writing by Gideon when he sent a letter using the [2003] MLJU 81 at 59

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(5)

(6) (7) (8)

(9)

(10)

(11) (12)

(13)

(14)

(15) (16) (17)

(18)

(19)

letter head of his law firm by the name of Messrs Gideon Tan Razali Zaini dated 8.8.2002. This lie was subsequently exposed during the limited search conducted at the said premises on 13.8.2002. The defendant lied about the contents of the CD-ROMs which the defendant said that they contained electronic files that could only be read with an old programme like "Lotus 23" which was allegedly not available in the defendant's computers when, in fact, they contained mostly Microsoft Excel files and word processing files. Refusal by the defendant to permit photocopies of documents to be taken of the "Recall" boxes. And now there appears to be partial but very strenuous compliance after the defendant was threatened with committal proceedings. Refusal by the defendant to allow the plaintiff to take into custody the documents under the said Order. The plaintiff has no liberty to control fully the photocopying of the documents that have been inspected. In fact, the defendant exercised complete control of the photocopying of the documents. [2003] MLJU 81 at 60 Refusal by the defendant to permit photographs of the documents to be taken at the conference room where the inspection was undertaken and Patrick cited the reasons of self-incrimination if the photographs were taken notwithstanding the fact that photographs of the documents are allowed under and in pursuance to the said Order. Refusal by the defendant to permit the search of priority documents as requested by the plaintiff. Instead the defendant demanded a tedious route of going through the documents without the help of the plaintiff and then indexing those documents before the plaintiff could even begin to view the relevant documents. Refusal on the part of the defendant to adhere to the advice of the supervising solicitors despite being cautioned of the contemptuous nature of the defendant's conduct. There was an attempt to warn third parties -- the defendant's joint venture partner as alleged by Patrick, of the contents of the said Order. The plaintiff was concerned of the possibility that third parties having possession of certain documents covered under the said Order may temper or even destroy such documents. [2003] MLJU 81 at 61 Refusal by the defendant to permit the plaintiff to view or take copies of those documents which relate to Air-Conditioning and Mechanical Ventilation ("ACMV") works when such letters were written by KLCC or Henz Construction and notwithstanding that such letters were copied to R&G. There was a deliberate stalling of the execution process and the refusal by the defendant to permit a review of the documents until the arrival of the defendant's solicitors notwithstanding the fact that the procedure for inspection has been introduced by the defendant in the course of execution of the said Order by the plaintiff. The defendant deliberately delay the time available in a day for execution of the said Order by not permitting execution to commence at 9.00 a.m. notwithstanding the fact that the said Order stipulates the time for inspection to be between 8.00 a.m. to 5.00 p.m. During lunch time, the defendant deliberately halted the inspection of the documents in direct contravention of the said Order. Failure on the part of the defendant to expedite the retrieval of documents from Recall and deliberately delaying the inspection [2003] MLJU 81 at 62 of those documents by refusing to give the plaintiff the priority lists of documents. Refusal by the defendant to permit any copying of documents between KLCC and R&G for documents that do not have the word "Mechanical" in the heading of the letters even though those documents clearly relate to the mechanical works undertaken by the plaintiff in the KLCC Contract Package No: 46400. Refusal by the defendant to take up the plaintiff's offer to mitigate the loss of time in executing the said Order by rejecting the plaintiff's offer to transport the balance of the "Recall" boxes from the storage facility and also declining to accept the plaintiff's offer of additional

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photocopying machines to be mobilised at the said premises in order to speed up the execution process. The sum total of it all would be this. That the defendant employed stalling tactics and created obstacles to delay the inspection of the documents. That Alex had advised Gideon that the latter may himself be liable for committal proceedings since Gideon had advised his client not to comply with the said Order. That on August 13, 2002, Tina had some [2003] MLJU 81 at 63 discussions with Alex in regard to the validity and enforceability of the said Order and Alex had responded by saying that the said Order had not been set aside or amended in any way and so Alex explained that his duty as a supervising solicitor was to advise the parties of the effect of the said Order as it stood in its present form and the consequences of non-compliance of the said Order thereto. The plaintiff has been very magnanimous in many ways. The plaintiff has accommodated the defendant in the course of executing the said Order by: (a) (b) (c) agreeing to change the supervising solicitor to a new supervising solicitor; tolerating the very laborious and time consuming method of inspecting the files and making and taking copies thereof; and permitting the defendant to control the photocopying exercise of the documents that have been inspected.

The conduct of the defendant was quite exasperating. So by way of enclosure 29, the plaintiff applied for leave to issue committal proceedings against the defendant. I readily granted that leave on August 30, 2002. [2003] MLJU 81 at 64 What is an Anton Piller order? It is a search order. It directs that the defendant should permit specified persons to enter on its premises and inspect and take copies of and remove specified material or classes of material, including where appropriate, articles or other property. And where appropriate, the Anton Piller orders may include additional directions or provisions such as directions that the defendant should answer specified interrogatories or otherwise provide discovery in specified areas. Anton Piller orders named after the case from the Court of Appeal in Anton Piller KG v Manufacturing Processes Ltd and Others (supra) particularly at page 784, are aimed at supplementing the general rules relating to discovery and the following pre-conditions should exist (see the speech of Ormrod L.J. at page 784 of the report of the Anton Piller KG's case): (a) (b) (c) (d) that there is an extremely strong prima facie case against the defendant; that the damage, potential or actual, to the applicant (in this case the plaintiff) is very great if the order is not granted; [2003] MLJU 81 at 65 that there is clear evidence that the defendant has in his possession incriminating things or documents; and that there is a real possibility that the defendant may destroy such incriminating material before any application inter partes can be heard.

It must be borne in mind that the primary purpose of an Anton Piller order is to preserve evidence which will be necessary for the plaintiff's case (Columbia Picture Industries Inc v Robinson (1986) 3 All ER 338 at pages 367and 371 and Television Broadcasts Ltd. & Ors. v Mandarin Video Holdings Sdn. Bhd. (1983) 2 MLJ 346). The Anton Piller order is in the nature of a mandatory order of the court that may be granted ex parte in order to authorise the plaintiff to enter the premises of the defendant to search for articles or documents kept in the premises and upon sight of them, the plaintiff is authorised to inspect them and to remove them to be kept in the safe custody of the plaintiff's solicitors or the court. It is to prevent the destruction or concealment of evidential material which may be relevant in the pending litigation that the

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court will issue an Anton Piller order. An Anton Piller order may be granted to assist execution (Distributori Automatici Italia SpA v Holford General Trading Co Ltd (1983) 3 All ER 750) [2003] MLJU 81 at 66 and its use is not restricted to intellectual property cases but it extends to all kinds of cases (Yousif v Salama (1980) 3 All ER 405; and Lian Keow Sdn Bhd v C. Paramjothy (1982) 1 MLJ 217). It is likened to a civil search warrant and it is a very harsh remedy. In the words of Mark S.W.Hoyle, the learned author who wrote a book entitled "The Mareva Injunction And Related Orders", third edition at page 107 :
"Anton Piller orders are potentially as far-reaching as Mareva injunctions and involve many potential difficulties, not only because of consequent interference with the rights of individuals and companies, but also because of the effect on third parties. Anton Piller orders can be described as a formidable ally in preserving evidence and preventing empty judgments. The Anton Piller order, designed to prevent the destruction of evidence and/or the subject-matter of a dispute, is a mandatory order placing a heavy burden on a defendant. It usually comes as a surprise to the recipient of the order, and is only effective if it is planned and executed efficiently and discreetly. By its nature it can do great harm to a defendant, and the courts have always been careful to emphasise the extraordinary nature of the order."

The learned author then continued to say at the same page, the following :
"It is important to have proper organization of the service of an Anton Pller order. A recipient cannot be forced without further order to give entry to the plaintiff's solicitors or legal representatives, although his refusal is strong evidence of something to hide, and is a contempt of court even if the order was improperly obtained."

And thereafter at the footnote of the same textbook, the learned author said (see page 107 to page 108 of the textbook) :
"Goulding J, in Wardle Fabrics Ltd v G Myristis Ltd (1984) FSR 263, ChD, discussed the position when a court order was not obeyed but then discharged: [2003] MLJU 81 at 67

'What is the position in those circumstances? In the absence of authority, and if I were free to look at the matter from the first principles, I would have thought that if the court makes an order within its jurisdiction, by which I mean in such circumstances that the purported order is not a nullity in law, then a party is bound to obey it at his risk of contempt proceedings if he does not, and that the subsequent discharge of the order as having been irregularly obtained would not in logic and principle affect the disobedient party's liability to penalties for contempt. It seems to me the system of administering justice would break down if the subjects were entitled to apply their own or their advisers' ideas to the possibilities of subsequently setting aside an order and to disobey on the strength of such private judgment and then, if the judgment turned out not to have been right, be free from all penalty.' That at an earlier period such principles were accepted is shown, I think, by a brief quotation from a book formerly in much favour, Oswald on Contempt of Court, which cannot, however, be regarded as an up-to-date statement of the law since the most recent, namely the third, edition was published in the same year in which I was born. What the learned editor then said was this: 'An order irregularly obtained cannot be treated as a nullity but must be implicitly obeyed until by a proper application it is discharged, and the case is the same where the order is alleged to have been improvidently made, and in such cases the court may merely order the offenders to pay the costs of the breach and of the application to commit.' Then after a review of cases, including Scott v Scott (1913) AC 417, HL, and Anton Piller KG v Manufacturing Processes Ltd (1976) Ch 55, CA, the judge said, at page 275: '... if an order has been disobeyed the disobedience can found proceedings in contempt'."

Lord Denning MR aptly remarked in Anton Piller KG v Manufacturing Processes Ltd and Others (1976) 1 All ER 779 at page 783; (1976) Ch 55 at page 61:
"It seems to me that such an order can be made by a judge ex parte, but it should only be made where it is essential that the plaintiff should have inspection so that justice can be done between the parties and when, if the defendant

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were forewarned, there is a grave danger that vital evidence will be destroyed, that parties will be burnt or lost or hidden, or taken beyond the jurisdiction and so the ends of justice be defeated; and when the inspection would do no real harm to the defendant or his case."

Earlier on, Lord Denning MR in the same case at the same page spoke about the inherent jurisdiction of the court in these words: [2003] MLJU 81 at 68
"But it is a far stronger thing to make such an order ex parte without giving him notice. This is not covered by the rules of court and must be based on the inherent jurisdiction of the court. There are one or two old precedents which give some colour for it, Hennessey v Bohmann Osborne & Co (1877) WN 14, and Morris v Howell (1888) 22 LR Ir 77, an Irish case. But they do not go very far. So it falls to us to consider it on principle."

So much on the law. I shall now proceed further.

Analysis of the preliminary objection It must be emphasised that the defendant had not filed any affidavit in reply to enclosure 20 nor did the defendant file any affidavit to deny the averments in enclosures 21, 22 and 23. That being the case, the averments by the deponents in enclosures 20, 21, 22 and 23 were not contradicted nor rebutted by the defendant and so those averments must be deemed to be admitted by the defendant (Ng Hee Thoong & Anor v Public Bank Bhd (1995) 1 MLJ 281). Enclosure 20 was an affidavit in reply affirmed by Chan Kwai Moon on August 15, 2002 and the deponent is the contracts manager of the plaintiff. Enclosure 21 was an affidavit affirmed by Alex Nandaseri De Silva on August 19, 2002 and he is an advocate and solicitor of the High Court of Malaya and a partner in the legal firm of Messrs Raj & De Silva and he too affirmed the affidavit in his capacity as a solicitor appointed by the legal firm of Messrs Tay & Partners and he is also the supervising solicitor for the execution of the Norwich Pharmacal Order [2003] MLJU 81 at 69 coupled with the Anton Piller Order that was obtained by the plaintiff on August 2, 2002. While enclosure 22 was an affidavit of Chan Kwai Moon that was affirmed on August 19, 2002 and in his capacity as the contracts manager of the plaintiff. Enclosure 23 is an affidavit of Ong Chee Kwan that was affirmed on August 14, 2002 and he is the partner of a legal firm known as Messrs Lee Ong & Kandiah and he affirmed that affidavit in his capacity as a solicitor appointed by the legal firm of Messrs Tay & Partners and he too is the supervising solicitor for the execution of the Norwich Pharmacal Order coupled with the Anton Piller Order that was secured by the plaintiff. Obviously by that Anton Piller Order the plaintiff sought to discover and preserve evidence against the defendant and that evidence is in the possession of the defendant and that the evidence is likely to be destroyed or concealed by the defendant.And by way of the Norwich Pharmacal Order, the plaintiff sought to identify and to obtain evidence against others who have been involved with the defendant in tortious activities and this would fall squarely within the principle as enunciated by Norwich Pharmacal Co and Others v Commissioners of Customs and Excise (supra). Also by way of that Anton Piller Order, the plaintiff sought to prevent the defendant from warning others -- who may not already be named as defendants or [2003] MLJU 81 at 70 proposed defendants, from destroying or concealing evidence and, from the facts of the present case, there was evidence that Patrick attempted to warn third parties of the contents of the said Order. The plaintiff was really interested in securing all the original documents and copies of those documents as listed in Schedule 2 and for clarity that Schedule 2 is worded in this way (see the said Order) :
"All documents pertaining to the Mechanical Works (Air-Conditioning and Mechanical Ventilation Works) for the Retail Podium Contract Package No. 46400 of the Kuala Lumpur City Centre Project ('KLCC Project') which Henz Construction has awarded to R&G including but not limited to:-

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1. All contract documents; 2. Letters of award; 3. Payment records; 4. Certificates of the Mechanical Works; 5. Final accounts or any settlement accounts between Henz Construction and R&G in respect of the settlement of the Mechanical Works and payments relating thereto; 6. Site minutes and progress reports relating to Mechanical Works."

Suffice for me to say that the sequence of events as alluded to in enclosures 17, 20, 21, 22 and 23 clearly show that at the date of the filing of enclosure 16 which was on August 10, 2002, the plaintiff has not complied with and has been and continues to be in contempt of the said Order. That would be the truth of the matter. And so it is correct to say that the defendant's application in enclosure 16 amounts to an abuse of the process [2003] MLJU 81 at 71 of the court and should not be heard until the defendant has fully complied and/or purged its contempt in relation to the said Order. There is authority for this proposition and it comes from the highest court in the country. It is the decision of the Supreme Court in Wee Choo Keong v MBf Holdings Bhd & Anor and another appeal (1993) 2 MLJ 217 with the coram of Abdul Hamid Omar LP, Eusoff Chin and Mohamed Dzaiddin SCJJ. In that case, the outstanding judge in the person of the Lord President Tun Abdul Hamid Omar, recognised the issue forthwith and his Lordship in style said at page 220 of the report :
"Central in these appeals lies the important principle governing the rights, if any, of defendants who disobey orders of the court and then come forward to set aside the order disobeyed or to seek other relief from the court."

Continuing further and still maintaining that style, his Lordship succinctly said at page 220 to page 221 of the report :
"Obedience to court order

It is established law that a person against whom an order of court has been issued is duty bound to obey that order until it is set aside. It is not open for him to decide for himself whether the order was wrongly issued and therefore does not require obedience. His duty is one of obedience until such time as the order may be set aside or varied. Any person who fails to obey an order of court runs the risk of being held in contempt with all its attendant consequences. It has not been seriously disputed and indeed we find that it is also an established general rule of law that a party in contempt cannot be heard further in the same proceedings for his own benefit unless and until he has purged his contempt. The question which we have to determine in these appeals is the ambit of that general rule."

[2003] MLJU 81 at 72 In fine language, his Lordship Tun Abdul Hamid Omar continued to say (see page 221 to page 222 of the report) :
"Appellants' contention

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It has been urged on us by counsel for the appellants that there must first be a finding of contempt and a sentence on that finding before the rule can be invoked; the argument being that the party alleged to be in contempt is not in a position to 'purge' his contempt until sentence has been passed. It has also been urged on us that an exception to the general rule exists where the party alleged to be in contempt was applying to set aside the very order of which he is said to be in contempt. Astro Exito Navegacion SA v Southland Enterprise Co Ltd and Nan Jong Iron and Steel Co Ltd [1981] 2 Lloyd's Rep 595; [1982] Com LR 106 and the judgment of Romer LJ in Hadkinson v Hadkinson [1952] P 285; [1952] 2 All ER 567 were amongst the authorities cited in support of the exception. Finding

We are unable to accept that any exceptions per se exist to the general rule that a party in contempt cannot be heard until he has purged his contempt. We are in favour of the views expressed by Denning LJ in Hadkinson [1952] P 285; [1952] 2 All ER 567 that it is a matter of discretion depending on the circumstances of the case whether or not a litigant ought to be heard notwithstanding his contempt. This flexible approach to the jurisdiction is based upon a discretion to be exercised in accordance with the circumstances of the case which was accepted by the House of Lords in X Ltd & Anor v Morgan-Grampian (Publishers) Ltd & Ors [1991] 1 AC 1; [1990] 2 All ER 1. The recent unreported decision of Abdul Malek J in Instituo Bancario San Paolo Di Torina SPA v Colour Touch Sdn Bhd & Anor (Civil Suit No D5-22-1410-92)(unreported) was cited in support of the proposition that the rule would only apply where a writ of attachment or order of committal had been made. In our judgment, such a qualification on the application of the rule would be to place an unnecessarily low burden of obedience on the offending party. The rationale for the rule is public policy. Orders of court must be treated with respect and require strict obedience. In this regard, we are mindful of the competing public interest in a litigant having a right to be heard. Although the right to be heard is a fundamental right vested in all litigants, that right however cannot be taken as an absolute right. Where the litigant shows himself to have little or no regard to an order issued against him, then he has to an extent, forfeited his right to be heard or at least postponed that right until he has suitably purged his contempt. Prima facie case for contempt In the appeals before us, leave to issue committal proceedings has been granted. [2003] MLJU 81 at 73

This means that the learned High Court Judge has accepted that there was a prima facie case for contempt against the appellants. It may well be that on the hearing of the motion proper, the appellants will be acquitted of any charge of contempt. However, for purposes of the present appeals, the allegations of contempt are supported by the order for leave. In Instituo Bancario San Paolo Di Torina SPA (Civil Suit No D5-22-1410-92) (unreported), there appears to have only been an allegation of contempt without any more. Here, there is a finding of prima facie contempt which cannot be ignored. In this context, we are more inclined to accept the view expressed by Young J in Young v Jackman (1986) 7 NSWLR 97 where he said: 'Accordingly, it would seem from 1820 onwards that the rule that a person will not be heard when he is guilty of contempt extended as well to the case where a party was considered to be in contempt, that is, where his contempt had prima facie been demonstrated to the court or alternatively when he had confessed the facts which were the subject of a charge of contempt.' (Emphasis added). We have carefully read the appeal records and especially references made therein to the conduct of the appellants in general and the conduct of the third appellant in particular. This conduct relates to the manner in which the allegations of contempt arose. From the records, we are satisfied that the learned judge had ample material before him to exercise his discretion in the manner in which he did."

I too echoed the sentiments of the Lord President Tun Abdul Hamid Omar in the case of Bank Bumiputra Malaysia Berhad Cawangan Johor Bahru v Cheong Yoke Choy; Malaysian Central Depository Sdn Bhd (Intervener) (2000) 7 CLJ 157, which I adjudicated in the Johor Bahru High Court. There, at page 190 to page 191 of the report, I had this to say :

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"Enclosure 30 had been perfected. The application by the proposed intervener in encl. 28 was dated 22 July 1999 and it was filed on the same date. Calculated from 18 May 1999, the delay in filing encl. 28 came up to two months four days. But, it must be borne in mind that the first order in encl. 7 dated 26 May 1998 had been served on the proposed intervener on 14 September 1998 and at para. 'C' of the first order which had been reproduced somewhere in this judgment stated in general terms that the proposed intervener too was supposed to give the plaintiff the full particulars of the assets of the defendant held by the proposed intervener (see the letter marked as exh. 'P8' of encl. 34). Incidentally, the second order in encl. 12 was also served on the proposed intervener on 14 September 1998. [2003] MLJU 81 at 74 Calculated from 26 May 1998 to the time when the proposed intervener filed the application in encl. 28 on 22 July 1999, the delay to file encl. 28 came up to 1 year 1 month 26 days. It was argued that the first order in encl. 7 was not very specific, then the third order in encl.30 was very specific as it mentioned the proposed intervener by name, yet the proposed intervener had the audacity to thumb at the third order of this court and refused to obey it specifically for two months four days and even today there was still no obedience to the third order of this court. Obedience to a court order cannot be compromised. The third order in encl. 30 remained an order emanating from this court -- a court of law legally constituted and yet the proposed intervener saw it fit to disobey it. In Wee Choo Keong v MBf Holdings Bhd & Anor And Another Appeal [1993] 2 MLJ 217 Tun Abdul Hamid Omar LP in strong and clear language said:

'It is established law that a person against whom an order of court has been issued is duty bound to obey that order until it is set aside. It is not open for him to decide for himself whether the order was wrongly issued and therefore does not require obedience.His duty is one of obedience until such time as the order may be set aside or varied. Any person who fails to obey an order of court runs the risk of being held in contempt with all its attendant consequences.' The affidavit of Benothini in encl. 27 which was in support of encl. 28 did not say that the proposed intervener had obeyed the third order of this court in encl. 30. It was totally silent and so the strong and only inference would be that the proposed intervener failed to obey the third order of this court in encl. 30. There was certainly contempt and 'all its attendant consequences' must be borne by the proposed intervener. This was my judgment and I so hold accordingly. That would certainly dispose of encl.28 forthwith. Article 126 of the Federal Constitution states as follows:

'The Federal Court, the Court of Appeal or a High Court shall have power to punish any contempt of itself.' Without a doubt, the Supreme Law of our country gives the power to this court 'to punish any contempt of itself.' Lord Denning MR in Morris v Crown Office [1970] 2 QB 114 at 122; [1970] 1 All ER 1079 at 1081 succinctly said:

'The course of justice must not be deflected or interfered with.Those who strike at it, strike at the very foundations of our society. To maintain law and order, the judges have, and must have, power at once to deal with those who offend against it. It is a great power -- a power instantly to imprison a person without a trial -- but it is a necessary power.' Wood VC in Spokes v Banbury Board of Health [1865] LR 1 Eq 42 at 48 said:

'...the simple and only view is that an order must be obeyed, that those who wish to get rid of that order must do so by the proper course, an appeal. So long as it exists, the order must be obeyed, and obeyed to the letter...' [2003] MLJU 81 at 75 Sir John Donaldson in Howitt Transport v Transport and General Workers ' Union [1973] 1 CR 1 at 10 had this to say:

'...orders of any court must be complied with strictly in accordance with their terms. It is not sufficient by way of answer to an allegation that a court order has not been complied with for the person

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concerned to say that he 'did his best'. But if a court order requires a certain state of affairs to be achieved the only way in which the order can be complied with is by achieving that state of affairs.' I am appalled at the failure of the proposed intervener to obey the order of this court in encl. 30. A message must be sent to all and sundry that this court will not take lightly of a contempt of this nature. Before filing encl. 28, the proposed intervener must obey the order of this court as seen in encl. 30. This was never done and it was certainly an act of contempt."

InThiruchelvasegaram Manickavasegar v Mahadevi Nadchatiram (No 2) (2002) 1 CLJ 609 I reiterated the law in these words (see page 630 of the report) :
"Addendum

Reverting back to the court's discretion of not hearing the contemnor until the contempt is purged, it is indeed a good practice which should be maintained. He who is in contempt may not be heard further in the same litigation unless and until he has purged his contempt (Chuck v Cremer [1846] 1 Coop. Temp. Cott. 205 208Harrison v Harrison [1842] 4 Moo. PC 96; 13 ER 238 Garstin v Garstin [1865] 4 Sw. & Tr 73; 164 ER 1443 Cavendish v Cavendish and Rochefoucauld [1866] 15 WR 182; Hadkinson v Hadkinson(supra) and Bettinson v Bettinson [1965] Ch. 465)."

Continuing at page 631 of the report, I had this to say :

"By way of a preliminary objection the plaintiff argued that unless and until the defendant has purged her contempt, this court should not hear her on her application for a stay as reflected in encl. 257. I agree entirely with this submission. I decline to be flexible and, in the context of the present case, the discretion to hear the defendant without the defendant purging her contempt first cannot be exercised in the defendant's favour. In the words of Lord Bridge of Harwich in X Ltd v Morgan-Grampian (Publishers) Ltd and Others (supra) it was an 'abuse of the process of the court' for the defendant to file encl. 257 without first purging her contempt."

[2003] MLJU 81 at 76 Rounding it up, I finally said (see page 632 of the report):
"Here, it was part and parcel of my judgment that the defendant had abused the process of the court by filing encl. 257 without first purging her contempt."

Now, since leave to issue committal proceedings against the defendant had been granted, there was thus a prima facie case of contempt against the defendant. This was just like the case of Wee Choo Keong v MBf Holdings Bhd & Anor and another appeal (supra). The rule that a person who is in contempt has no right to seek an order of the court until he has purged his contempt is certainly consistent with the equitable maxim that 'he who comes to equity must come with clean hands', and this very maxim was vigorously applied by the Court of Appeal in the case of Timbermaster Timber Complex (Sabah) Sdn Bhd v Top Origin Sdn Bhd (2002) 1 MLJ 33.Public policy demands strict compliance with an order of court. In fact, there must be strict obedience to the letter. It is indeed a travesty of justice to require this court to hear enclosure 16 when the defendant disobeys the Order of this court dated August 2, 2002. For the reasons adumbrated above, I would allow the plaintiff's preliminary objection with costs. This meant that the hearing of enclosure 16 should be postponed until the defendant has purged its contempt by fully [2003] MLJU 81 at 77 complying with the Norwich Pharmacal Order coupled with the Anton Piller Order of this court dated August 2, 2002 as reflected in enclosure 13. The session on August 12, 2002 -- a Monday

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Mr. Gideon Tan for the defendant informed the court that today -- referring to August 12, 2002, it is scheduled for the hearing of enclosure 16. That enclosure was in the nature of an ex parte summons in chambers which sought for the following orders:
"(i) setting aside of the order dated 2.8.2002 ("the said Order") obtained through an ex parte application dated 27.6.2002 by the plaintiff; and/or (ii) stay of execution of the said Order until disposal of the defendant's application at paragraph (i) above; (iii) costs of this application to be borne by the plaintiff; and (iv) such further or other relief as this Honourable Court deems fit."

Mr. Gideon Tan informed the court that the application in enclosure 16 was supported by an affidavit in enclosure 14. There was also, according to him, a certificate of urgency as seen in enclosure 15. He informed the court that enclosure 16 was in the nature of an ex parte application but nevertheless he said that he had taken the liberty to inform the plaintiff's solicitors and to seek their attendance in court today -referring to August 12, 2002, so that the plaintiff's solicitors may participate. [2003] MLJU 81 at 78 Fortunately, Mr. Ramid Khan, the learned counsel for the plaintiff, attended court on that day -referring to August 12, 2002, and this was what he said with vigour and vitality :
"By way of a background, I wish to state that we appeared before YA on 2 August 2002 and we obtained an ex parte order before YA, a Norwich Pharmacal Order coupled with an Anton Piller Order. That Order is in enclosure 13. Following this Order the plaintiff executed the Order on 8 August 2002 (a Thursday). We have just filed an affidavit this morning (referring to August 12, 2002) pursuant to what had happened during execution and this is the affidavit in question (show to court and it is now marked as enclosure 17). In short, it is the contention of the plaintiff that when the plaintiff attempted to execute the Order on 8 August, 2002 (a Thursday), the execution could not be perfected because the plaintiff and its agents were not allowed to search the premises. The details are in the affidavit in enclosure 17. To cut the story short, following on from that day -- our lack of success on 8 August 2002 (a Thursday), this morning -referring to August 12, 2002, was set for another attempt to carry out the terms of the Order as per enclosure 13. In the meantime, we have discovered because of service by our learned friends that the defendant had on 10 August 2002 (a Saturday), filed enclosure 16 before YA to set aside or stay YA's first order on 2 August 2002 (enclosure 13) and so it is for hearing before YA today (12 August 2002) for enclosure 16. I submit that on that factual background, the plaintiff should be allowed to execute its Order to completion because that is the very purpose of an Anton Piller Order. In my view it is improper or ill advised for the defendant to refuse to allow a search at its premises pursuant to YA's Order dated 2 August 2002 in enclosure 13 and to arrange for the plaintiff to come back on the following Monday -meaning today (12 August 2002). We went on Thursday (8 August 2002) and tried to make a search pursuant to the Order of this court (enclosure 13) and it was unsuccessful. The actual search was refused. The defendant on Thursday suggested that they would make a list of documents which they felt would be relevant to us and that they would give to us today (referring to 12 August 2002). I wish to submit that because we were not allowed to search the premises as per enclosure 13, there is therefore in that respect a violation or a contempt of enclosure 13 -- YA's Order. If that is the situation, I think what is proper in law is for the defendant to purge that contempt by allowing us to follow the Order and effect the Order as per enclosure 13. After that is done, it is up to the defendant to challenge or strike out enclosure 13. They must purge their contempt by allowing us to carry out the Order as per enclosure 13. Rightly or wrongly the Order as per enclosure 13 must be carried out. It is an immediate Order. It is ex parte and it is binding. It contains all safeguards to the defendant or third parties. Therefore, in conclusion, in my humble opinion [2003] MLJU 81 at 79 enclosure 16 cannot be taken today because the contempt for the failure to comply with YA's Order in enclosure 13 is still subsisting.

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Quite apart from that YA, enclosure 16 was filed on Saturday (10 August 2002) and faxed to us on the same Saturday and unfortunately we don't work on Saturday. We just found out this morning (12 August 2002) about the application in enclosure 16 and the affidavit in enclosure 14 and the perakuan segera in enclosure 15. So, therefore, we need to reply to enclosure 14 -- the affidavit of the defendant. I now refer to the case of Wee Choo Keong v MBf Holdings Bhd & Anor and another appeal (1993) 2 MLJ 217. The Order of court in enclosure 13 must be obeyed and enclosure 16 cannot be heard today especially because the plaintiff could have got the benefit of YA's Order as per enclosure 13 if there was compliance with YA's Order when we executed it on 8.8.2002 (Thursday) In fact, it is that very non-compliance which has allowed the defendant to put in the application in enclosure 16 on 10.8.2002 (Saturday). So now I ask the court for two things:

(1) That enclosure 16 be adjourned until after the completion of the Order of this court in enclosure 13. (2) That perhaps the defendant be advised or directed to comply with the Order of this court as per enclosure 13. That's all YA."

These submissions of Mr. Ramid Khan were very apt indeed. It showed that the defendant was thumbing at the Order of this court dated August 2, 2002 without due regard to it at all. It showed that when the plaintiff attempted to execute the said Order on Thursday -- August 8, 2002, it was to no avail. Unsuccessful. It is a classic case of disregarding the Order of this court which not only deprive the plaintiff of the benefit of the said Order but also severely impairs the effective administration of justice. Cross J. in Phonographic Performance Ltd v Amusement Caterers (Peckham) Ltd (1964) Ch 195 at 198 succinctly said:
"Where there has been wilful disobedience to an order of the court and a measure of contumacy on the part of the defendants, then civil contempt, what is [2003] MLJU 81 at 80 called contempt in procedure, 'bears a two-fold character, implying as between the parties to the proceedings merely a right to exercise and a liability to submit to a form of civil execution, but as between the party in default and the state, a penal or disciplinary jurisdiction to be exercised by the court in the public interest'."

Mr. Ramid Khan was certainly unhappy that the refusal on the part of the defendant to obey the said Order when the plaintiff attempted to execute that Order on Thursday, the 8th of August 2002, had provided an opportunity for the defendant to file enclosure 16 on a Saturday -- the 10th of August 2002. According to Mr. Ramid Khan, had the defendant obeyed the said Order during its execution on August 8, 2002, there would not be enclosure 16 before this court. In United Nurses of Alberta v A.G. for Alberta (1992) 89 DLR (4th) 609, 636, McLachlin J. nicely put it in this way:
"A person who simply breaches a court order is viewed as having committed a civil contempt. However, when the element of public defiance of the court's process in a way calculated to lessen societal respect of the courts is added to the breach it becomes criminal."

Mr. Brian Cumming, another learned counsel who acted for the plaintiff, in serious tone confirmed what Mr. Ramid Khan had submitted. This was what Mr. Brian Cumming said :
"Factually, it is correct."

So whatever Mr. Ramid Khan had submitted must have reflected the exasperation of the plaintiff when the latter attempted to execute the said [2003] MLJU 81 at 81 Order on August 8, 2002 -- that fateful Thursday.

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Mr. Gideon Tan, the learned counsel for the defendant, submitted by way of a response and this was what he said :
"On the issue of the purported contempt:

(1) The documents sought pursuant to the Order as per enclosure 13 are documents pertaining to a project of KLCC Suria and that project has been completed at least three years ago. And that these documents are in storage with a company called Recall Total Information Management. The plaintiff's solicitors were informed of this fact and they were also informed that the list and inventory of those documents under storage at Recall were kept by Miss Loh who was on leave on Thursday and only returning to work today -- referring to August 12, 2002.

The plaintiff was told that the defendant had every intention of complying with the order of YA as per enclosure 13 but the defendant could only obtain the documents from Recall warehouse by today (12 August 2002). The plaintiff was invited to return to the defendant's premises at 3.00 p.m. today (12 August 2002) so that we can forward the documents as requested for as per enclosure 13. (2) As it stands, the defendant has to retrieve the documents from Recall for it to be forwarded to the plaintiff. There are no documents at our client's premises. As such, given the fact that enclosure 13 has also other mandatory prayers for us to hand over the documents and we are in the process of complying. There can be no suggestion that we are in contempt of this Honourable Court. In Wee Choo Keong, it should be noted that in that case committal proceedings had commenced pursuant to Order 52 RHC and that Order 52 sets out two stage processes. Firstly, an ex parte motion must be taken to show a prima facie case of contempt. Secondly, another notice of motion in which the contemnor is required to purge his contempt or to show cause. Today -- referring to August 12, 2002, all we have is YA's Order -- enclosure 13 which the defendant are currently in the process of complying and therefore there is no contempt to be purged as set out in Wee Choo Keong's case. In Wee Choo Keong's case there was a contempt proceeding being undertaken. There the ex parte motion for contempt has been granted and there was the hearing of the motion proper. Under those circumstances, the court had already found prima facie contempt. Here, in our current situation, there is no committal proceeding and in fact today -- as of today (12.8.2002), my client i.e. [2003] MLJU 81 at 82 the defendant is complying with the order by having the documents retrieved from Recall the warehousing company. I believe the documents will be made available this afternoon -- my client's premises are at UBN Towers at the 6th floor. During lunch time, I have checked with them and my clients say that the documents are coming. I rely on these two authorities:

(a) Lim Hean Pin v Thean Seng Co Sdn Bhd & Ors (1991) 2 MLJ 564; and (b) Mareva Injunctions and Antor Piller Relief by Steven Gee, at page 374."

Now, briefly in his submission Mr. Gideon Tan sought to justify what the defendant did on Thursday -August 8, 2002. He submitted that the defendant intended to obey the Order of this court dated August 2, 2002. After hearing the submissions of the parties as alluded to and reproduced verbatim by me in this judgment, I then made the following orders :

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"(1) Bicara lampiran 16 pada 20 Ogos 2002. (2) Jawapan affidavit plaintif kepada lampiran 14 perlu difailkan pada atau sebelum 15 Ogos 2002."

This meant that on August 12, 2002, I did not hear enclosure 16 on its merits and I gave time to the plaintiff to file an affidavit in reply to the defendant's affidavit in enclosure 14 and I too fixed the date for the hearing of enclosure 16 on August 20, 2002. [2003] MLJU 81 at 83 I reiterate that I did not hear enclosure 16 on its merits on August 12, 2002. I merely heard the submissions of the learned counsel for both sides and I then made those two Orders. Nothing more or nothing less. But alas, the learned counsel for the defendant had filed a notice of appeal against those two Orders which I gave on August 12, 2002 and I was rather "surprised" at the way the notice of appeal was phrased and framed as seen in enclosure 36 and I should reproduce it verbatim in order to appreciate what I meant when I said that I was "surprised". The notice of appeal was phrased in this way :
"Ambil perhatian bahawa Harbert International Est Sdn Bhd, Perayu yang dinamakan di atas, tidak berpuas hati dengan keputusan Yang Arif Dato' Haji Abdul Malik bin Hj. Ishak yang diberikan di Mahkamah Tinggi Malaya di Kuala Lumpur pada 12 haribulan Ogos 2002 yang memperintahkan bahawa saman dalam kamar (ex parte) bertarikh 10 haribulan Ogos 2002 ditangguhkan untuk didengarkan secara inter partes pada 20 haribulan Ogos 2002, dan menolak permohonan Perayu untuk penggantungan perintah ex parte bertarikh 2 haribulan Ogos 2002 sehingga selesai pendengaran saman dalam kamar (ex parte) bertarikh 10 haribulan Ogos 2002, dan merayu kepada Mahkamah Rayuan terhadap keseluruhan keputusan tersebut.

Bertarikh pada 13hb Ogos 2002."

That notice of appeal stated that on 12 August 2002 this court ordered that the ex parte summons in chambers dated 10 August 2002 (referring to enclosure 16) be adjourned to be heard inter partes on 20 August 2002, and this court too dismissed the defendant's application (referring to enclosure 16) to stay execution of the order of this court dated August 2, 2002. I must [2003] MLJU 81 at 84 at once say that the notice of appeal did not reflect the two orders of this court that was handed down on August 12, 2002. The notice of appeal did not state that the plaintiff was required to file an affidavit in reply to the affidavit of the defendant in enclosure 14 on or before August 15, 2002. How could this court hear enclosure 16 that was supported by an affidavit in enclosure 14 without the benefit of an affidavit in reply from the plaintiff to rebut enclosure 14? It must be recalled that enclosure 16 was filed on August 10, 2002 -a Saturday, and when my learned deputy registrar in the person of Madam Madihah binti Harullah alerted me in regard to the existence of enclosure 16, I immediately set the date on August 12, 2002 to hear enclosure 16. That was in the nature of an expeditious fixing of a case in my court. Be that as it may, upon hearing the parties on August 12, 2002, I decided, in fairness to both the parties, that I should not hear enclosure 16 on its merits on that day because of the following reasons: (1) (2) (3) that the order of this court dated August 2, 2002, as seen in enclosure 13, has not been executed as yet; that there was hardly time for the plaintiff to prepare and file an affidavit in reply to the defendant's affidavit in enclosure 14; and [2003] MLJU 81 at 85 that this court, bereft of an affidavit in reply emanating from the plaintiff, was hindered in adjudicating enclosure 16.

Justice has always been the overriding principle. And so on August 12, 2002, I did not hear the merits of enclosure 16. I merely took down copiously the submissions of both the parties. Consequently, it was pointless to file a notice of appeal as seen in enclosure 36. That is the truth of the matter. In the words of

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Elizabeth Cady Stanton, The Woman's Bible :

"Truth is the only safe ground to stand upon."

Sir Walter Scott, in the "Marmion" aptly said :

"O, what a tangled web we weave, when first we practise to deceive!"

Enclosure 33 Enclosure 33 was quite interesting. It was in the nature of a summons in chambers and it was an application on the part of the plaintiff for the following orders :
"(1) The plaintiff shall have the right to continue with the execution of the Order of Court dated 2.08.2002 ('the Court Order') without further obstruction from the Defendant or their solicitors; (2) That all documents as described in Schedule 2 of the Court Order and all the storage boxes retrieved from Recall Total Information Management, [2003] MLJU 81 at 86 including any such other Recall boxes which may still be in the possession of Recall Total Information Management or the Defendant (all of which hereinafter will be referred to as 'the Recall boxes'), together with all the CD-ROMs in the possession of the Defendant be immediately taken into the custody of the Plaintiff under the supervision of the supervising solicitors, namely Raj & de Silva and be deposited into the Plaintiff's office or such other place as the supervising solicitors shall think fit subject always to such premises being in the opinion of the supervising solicitors reasonable for the carrying out of this direction; (3) That up to 5 Plaintiff's representatives be permitted to search through all the documents in the Recall boxes and to review the contents of the CD-ROMs simultaneously in such manner as the supervising solicitor shall deem fit and expeditiously with a view of completing the execution of the Court Order as soon as possible in the presence of the Defendant and their solicitors (if they so wish to be present) without any interference whatsoever from the Defendant or their solicitors; (4) That all documents which the Plaintiff's representatives have identified as being not relevant to the Court Order be returned to the Defendant forthwith after the inspection; (5) That all documents which the Plaintiff's representatives have identified as being relevant to the Court Order be copied immediately (including softcopy of the CD-ROMs) and such copies be kept in the custody of the Plaintiff's solicitors and the originals thereof be returned to the Defendants forthwith after copying; (6) That the Defendants be permitted to identify which of the documents or files within the CD-ROMs (of which copies have been made) are not relevant to the Court Order with written reasons within 48 hours thereof, failing which all documents and files are deemed to be covered under the Court Order; (7) That in the event any of the documents or files are identified by the Defendant pursuant to paragraph 5 above as being not relevant to the Court Order, the list thereof together with their written reasons shall be submitted to the Plaintiff's solicitors who shall report the same to this Honourable Court for further directions; (8) Costs of this application including incidental costs be paid by the Defendant; and (9) Such further or other relief as this Honourable Court deems fit."

[2003] MLJU 81 at 87 The grounds in support of the application were stated in enclosure 33 itself and they were in these fashions :
"The grounds of this application are that the Defendant has taken the stand that the Court Order has lapsed pursuant to Order 29 rule 1(2B) of the Rules of the High Court 1980. As a result, there is real risk that the Defendant may destroy, tamper with, remove or add to the documents and items required under the Court Order to be disclosed to the Plaintiff. The grounds of this application are also stated in the affidavits of CHAN KWAI MOON filed on 19 August 2002 and 29 August 2002."

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But, the hearing of enclosure 33 did not go on because Mr. Gideon Tan, the learned counsel for the defendant, raised two preliminary objections, namely:
"(1) Whether YA is to hear enclosure 16 or enclosure 33 first? (2) Whether Order 29, rule 1(2B) of the RHC applies to the ex parte Norwich Pharmacal Order coupled with the Anton Piller Order (which has, all along in this judgment, being referred to as 'the said Order') that was granted by this court on August 2, 2002 as reflected in enclosure 13?"

So, it can be surmised that enclosure 16 had not been heard, on its merits, by this court at all. In that event, the notice of appeal in enclosure 36 was filed without any basis whatsoever. As I see it, by way of enclosure 33 the plaintiff sought for two main prayers. Firstly, it sought for the right to continue with the execution of the [2003] MLJU 81 at 88 said Order that was granted on August 2, 2002. Secondly, it sought to vary the said Order in question. Whereas enclosure 16 -- which had been reproduced earlier in this judgment, was the defendant's application to set aside the said Order. Mr. Gideon Tan submitted that if enclosure 16 was heard first, the same submissions would also be repeated for enclosure 33. He submitted that essentially he would be submitting that the said Order should be set aside and that there should not be any variation to the said Order. He felt that enclosure 33 should be adjourned until this Court disposed off enclosure 16. Mr.Ramid Khan, in rebuttal, submitted that the said Order had not lapsed. He submitted that the said Order is still in force till today but, despite it being in force, the plaintiff had been prevented from executing the said Order any further. For that reason, he said that the plaintiff sought the right to continue with the said Order without any further obstruction. So he said that since the said Order is still "alive" and the plaintiff is prevented from executing the said Order -- which Order allows the plaintiff to search and seize documents which are relevant, then it becomes immediately [2003] MLJU 81 at 89 apparent as to why enclosure 33 is so important that it must be disposed off soonest possible. He submitted that it is quite logical that enclosure 33 should be heard first before enclosure 16 and he advanced the following reasons: (1) That by the very nature of the said Order, it has to be executed forthwith. The said Order still stands but the plaintiff was prevented from executing it. So the plaintiff is worried bearing in mind that the risk of destruction of documents has increased tremendously. In short, the plaintiff is saying that the said Order is still in force but the plaintiff cannot execute it. That the plaintiff is scared. That the risks that the documents which the plaintiff intended to procure would be destroyed gave the plaintiff the impetus to move this court on a certificate of urgency as seen in enclosure 32 in order to expedite the hearing of enclosure 33. All these are said to have been done in order to preserve the documents under the inherent jurisdiction of this court under Order 92, rule 4 of the RHC or under Order 29, rule 2 of the RHC where it would be for the purpose of the interim preservation of those documents which are said to be under threat of being destroyed. [2003] MLJU 81 at 90 That if the said Order continues to be in force, then the parties under that Order are obliged to comply with that Order completely or unconditionally while the Order still stands. That it is not open for a party to comply partially or not to comply at all with the said Order on the basis of a unilateral view that the said Order should not be granted in the first place. That if the said Order still stands then it must be respected completely. So, in a nutshell, it is said that it is not open to the defendant to say that the setting aside of the said Order in enclosure 16 must be heard first before the plaintiff's application in enclosure 33 is heard. It is stressed that the said Order is still "alive".

(2)

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(3) (4)

(5)

That this court had granted leave for committal proceedings on August 30, 2002 and so there is a prima facie finding by this court of non-compliance with the said Order by the defendant. The plaintiff had filed, but not extracted, a notice of motion to that effect. There is nothing in enclosure 13 to say that the said Order would expire 21 days or three weeks from the date of its grant.In a normal ex parte injunctive order, there is a prayer to say that the life span would expire 21 days after its grant. Whereas in enclosure 13 there is no such prayer. In a normal ex parte [2003] MLJU 81 at 91 interim injunctive order, that order will have a return date where the court will direct that the matter be heard inter partes within three weeks (21 days) of its grant. That Order 29, rule 1 (2B) of the RHC speaks of an interim injunction obtained on an ex parte application shall automatically lapse at the end of 21 days from the date of its grant. That the words employed in Order 29, rule 1 (2B) of the RHC expressly refer to and can only apply to an ex parte interim injunction. That Order 29, rule 1 (2B) of the RHC do not apply to the said Order as seen in enclosure 13 because the said Order is not an interim injunctive Order.

I must place on record that I wholeheartedly agree with the reasons advanced by Mr. Ramid Khan as to why enclosure 33 should be heard first before enclosure 16. Mr. Gideon Tan submitted on behalf of the defendant along these lines: (a) That right up to August 23, 2002, the plaintiff was allowed a systematic search of the defendant's office premises. That the plaintiff was also allowed a systematic search and copying of [2003] MLJU 81 at 92 documents containing 89 cartons of boxes of documents. That the plaintiff had already taken approximately 8,000 copies of documents. So, the plaintiff has been allowed to execute the said Order as reflected in enclosure 13. That after August 23, 2002, the defendant takes the view that enclosure 13 has lapsed automatically pursuant to Order 29, rule 1 (2B) of the RHC.It is for that reason that the defendant says that enclosure 33 amounts to an extension of an Order which has lapsed. So if the court is of the view that the said Order in enclosure 13 has lapsed, then it is more expedient for enclosure 16 to be heard first as it would also decide on enclosure 33. And that if enclosure 16 is disposed off in the defendant's favour and the said Order in enclosure 13 is set aside, then there is no need to extend or vary as envisaged in enclosure 33.

(b)

I have taken note of the submissions of Mr. Gideon Tan but I still preferred the salient submissions of Mr. Ramid Khan. It was part and parcel of my judgment, that the said Order as reflected in enclosure 13 must be obeyed dutifully and to the fullest extent. Since [2003] MLJU 81 at 93 leave to institute committal proceedings was granted on August 30, 2002 by this court, this meant that I, as the High Court judge "has accepted that there was a prima facie case for contempt against"the defendant (see the speech of that brilliant Lord President Tun Abdul Hamid Omar in Wee Choo Keong's case (supra) at page 221 to page 222 of the report). The notice of motion too has been filed, although it is not extracted as yet. So, the position is this. That the defendant cannot be heard until the defendant has purged its contempt by fully complying with the said Order as reflected in enclosure 13. That would be the legal position of the defendant and it is reflective of the current law in the country (Wee Choo Keong's case (supra)). Flowing from that, the defendant's application in enclosure 16 cannot be heard until the defendant has purged its contempt. This meant that the plaintiff's application in enclosure 33 should be heard first. Preference should be given for the hearing of enclosure 33 as opposed to enclosure 16. It was as simple as that. I will now allude to the remaining issue at hand. Has the said Order in enclosure 13 lapsed as alleged by the defendant? I am of the considered view that the said Order is still valid and good in law and that it should be

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obeyed by the defendant dutifully. [2003] MLJU 81 at 94 Order 29, rule 1 (2B) of the RHC is worded in this fashion:
"Unless sooner revoked or set aside, an interim injunction obtained on an ex parte application shall automatically lapse at the end of 21 days from the date on which it is granted."

But the said Order is in the nature of a Norwich Pharmacal Order coupled with the Anton Piller Order and they are certainly not "interim injunction(s)" as envisaged under Order 29, rule 1 (2B) of the RHC. The said Order is not granted pending an event or to maintain the status quo. This view is certainly reinforced by looking at the sealed copy of the said Order in enclosure 13 itself. Fortunately, there is an express judicial pronouncement in this country which categorically states that Anton Piller Orders are not subject to Order 29, rule 1 (2B) of the RHC. In the Malaysian Court Practice, a 2002 edition of the Malayan Law Journal Sdn Bhd, on High Court Practice: Issue 12, there are passages at page 1355 to page 1356 that are germane to the occasion and should be reproduced here :
"It has been held that two-week limitation (now 21 days) for applications to set aside interim injunctions is not relevant to Anton Piller orders; see GMX Associates Pte Ltd & Anor v Lee Yew Pooi (Berniaga di bawah nama dan gaya Universal Trading Co) (1999) 1 AMR 125, HC where the court stated that the provisions of Order 29 rule 1 (2B) relate specifically to interim injunctions and that nothing could be construed therein to include Anton Piller Orders."

[2003] MLJU 81 at 95 I venture to add that Order 29, rule 1 (2B) of the RHC do not extend nor cover those matters under a Norwich Pharmacal Order because they are not in the nature of interim injunctions. The case ofGMX Associates Pte Ltd & Anor v Lee Yew Pooi (Berniaga di bawah nama dan gaya Universal Trading Co) (1999) 1 AMR 125 was a decision of Steve Shim J.(as he then was and now the Chief Judge of Sabah and Sarawak) and there his Lordship said at page 128 of the report:
"At the outset, let me state that on the face of the ex-parteapplication taken by the plaintiffs, it does not disclose under which particular Rules of the High Court it is taken out, although the affidavit in support does, in certain paragraphs therein, give some indication that perhaps the application is taken out under Order 29 of the Rules of the High Court. If so, they may only relate to prayer (4) of the said application which clearly seeks an injunctive relief whereas the other prayers are more in the nature and form of an Anton Piller redress. In the absence of any clear, precise and definite indication, I am entitled to take the stand that the plaintiffs have taken out the said application under the inherent jurisdiction of the court. It is therefore within such perspective that I should fairly consider this preliminary objection. Now, in countering the plaintiffs' proposition above, Miss Thye, counsel for the defendant submitted that the orders contained in the ex-parte Order dated December 31, 1997 were, except for Order (5) therein, in effect Anton Piller orders and therefore the common law position would apply. I tend to agree. In my view, the provisions of Order 29 r 1(2B) of the Rules of the High Court are clear enough. They relate specifically to interim injunctions. Nothing can be construed therein to include Anton Piller orders."

It is also ideal to refer to the case of Television Broadcasts Ltd & Ors v Mandarin Video Holdings Sdn Bhd (1983) 2 MLJ 346, a decision of NH [2003] MLJU 81 at 96 Chan J. (as he then was and who retired as JCA). There his Lordship said at page 353 of the report:
"In the instant case, the defendants are pirates. They are thieves and I daresay untrustworthy. They are unscrupulous people. When dealing with them this court has to be specially wary. Was there a genuine fear in the instant case? Were essential documents and articles at risk? I was satisfied that the plaintiffs have a legitimate fear that important documents and infringing video cassettes would be removed or hidden. I accepted the view of the plaintiffs that there was a real possibility of that happening. So I granted the order that was sought. It is an Anton Piller order. It was made ex parte and it also carries with it an injunction enjoining the defendants from doing various acts which would be infringing acts. But the order for an injunction is only temporary. It stood until the hearing of an inter partes application for it to be continued. This application is now being opposed strenuously by the defendants."

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Unfortunately, the defendant has not produced a single judicial authority overruling the case of GMX Associates Pte Ltd & Anor v Lee Yew Pooi (Berniaga di bawah nama dan gaya Universal Trading Co) (supra). Nor has the defendant produced a single judicial authority to state that Order 29, rule 1 (2B) of the RHC apply equally to the Norwich Pharmacal Order coupled with the Anton Piller Order. Bereft of a single judicial authority in opposition, I must therefore hold that Order 29, rule 1 (2B) of the RHC do not apply to the said Order at all. It is germane to mention that Order 29, rule 1 (2B) of the RHC is indeed unique to Malaysia only. Therefore, authorities from other common law jurisdictions cannot assist nor provide any guidance on the applicability of Order 29, rule 1 (2B) [2003] MLJU 81 at 97 of the RHC to the Norwich Pharmacal Order coupled with the Antor Piller Order as seen in enclosure 13. Now, since the said Order has not lapsed can the said Order be varied?The plaintiff by way of enclosure 33 seeks, inter alia, to secure the preservation of the documents covered under the said Order which have still not been discovered. Order 92, rule 4 of the RHC gives to this court the inherent jurisdiction to grant "any order as may be necessary to prevent injustice." In its original text, Order 92, rule 4 of the RHC reads as follows :
"4. For the removal of doubts it is hereby declared that nothing in these rules shall be deemed to limit or affect the inherent powers of the Court to make any order as may be necessary to prevent injustice or to prevent an abuse of the process of the Court."

Edgar Joseph Jr. J. (as he then was and who later rose to be a senior Federal Court Judge) vigorously applied Order 92, rule 4 of the RHC in the case of Tan Lay Soon v Kam Mah Theatre Sdn Bhd (Malayan United Finance Bhd, Intervener) (1992) 2 MLJ 434 and at page 446 of the report his Lordship had this to say:
"The cases of Astro Exito Navegacion SA v Southland Enterprise Co Ltd & Anor (Chase Manhattan Bank NA intervening) [1982] 3 All ER 335; [1982] QB 1248; [1982] 3 WLR 296 and Smith v Peters (1875) LR 20 Eq 511, were cited with approval by the Federal Court in TR Hamzah & Yeang Sdn Bhd v Lazar Sdn Bhd [1985] 2 MLJ 45 wherein reference was also made to the provisions of O 92 r 4 which reminds the High Court of its inherent powers to make any orders as may [2003] MLJU 81 at 98 be necessary to prevent injustice or to prevent an abuse of the process of the court. I am fortified in the conclusion at which I have arrived by these authorities."

His Lordship Edgar Joseph Jr. J. (as he then was and who later rose to be the senior Federal Court Judge) in the same case made a brief reference to Order 29, rule 2 (1) of the RHC in these words (see page 442 of the report) :
"Also relevant is the protective measure of O 29 r 2(1) of the RHC which says:

'On the application of any party to a cause or matter the Court may make an order for the detention, custody or preservation of any property which is the subject-matter of the cause or matter, or as to which any question may arise therein, or for the inspection of any such property in the possession of a party to the cause or matter.' The case of Chaplin v Barnett (1912) 28 TLR 256 shows that O 29 r 2(1) extends to every case in which the court sees that as between the parties something ought to be done for the security of the property the subject matter of the action or, as to which, a question may arise in the action."

Thus, it is clear that while Order 92, rule 4 of the RHC gives this court the inherent jurisdiction to grant any order in order to prevent injustice, this court too can seek recourse to Order 29, rule 2 (1) of the RHC which gives this court the necessary jurisdiction to grant orders for the detention, custody, preservation or inspection of any property which is the subject matter of the cause or matter. Adding to all these, would be Order 29, rule 2 (4) of the RHC which states :

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"An order under this rule may be made on such terms, if any, as the Court thinks just."

[2003] MLJU 81 at 99 That would constitute the power, in all its splendour, of this court to vary the said Order if this court is so minded to do so. That would also reflect the power of this court to grant the Norwich Pharmacal Order coupled with the Anton Piller Order which power was exercised on 2.8.2002. I must place on record that I have yet to adjudicate enclosure 33 on its merits.I look forward to the submissions of the parties in the near future on the merits of enclosure 33. Still on the inherent jurisdiction of the court, it would be germane to refer to the case of Pacific Centre Sdn Bhd v United Engineers (Malaysia) Bhd (1984) 2 MLJ 143, a decision of Edgar Joseph Jr. J. (as he then was and who later rose to be the senior F.C.J.). There his Lordship said at page 147 to page 148 of the report :
"English Judges, with the exception of Lord Justice Stephenson, following the traditionalist line, have neatly avoided the question whether inherent jurisdiction can be invoked for purposes of granting Mareva injunctions. In Bekhor & Co., Ltd. v Bilton [1981] 2 All E.R 565 it was argued that jurisdiction to order discovery in aid of Mareva flows from an 'inherent or residual jurisdiction' or '...general residual discretion to make any order necessary to ensure that justice be done between the parties.' The Court of Appeal however opted to find jurisdiction in powers incidental to the statutory injunctive power. I might add, in passing, that I do not consider that there is any substance in the submission that O.92 r.(4) of the Rules of the High Court is purely a rule of practice. The Rules of the High Court were enacted in exercise of the powers conferred by s.70 of the Courts of Judicature Act, 1964, with the consent of the Chief Justices of Malaya and Borneo and the Rules Committee and are comprised in P.U.(A) 50 which is clearly subsidiary legislation within the meaning of section 3 of the Interpretation Act, 1967. The Rules in my opinion, therefore, have statutory force and are not mere rules of practice. In the result, I hold that there is jurisdiction by virtue of inherent powers to grant Mareva injunctions in this country."

[2003] MLJU 81 at 100 But, all things said and done, the plaintiff was quite worried. The defendant took the stand that the said Order had lapsed on 23.8.2002. But the plaintiff rightly held onto the opinion that it was not. I had earlier held that Order 29, rule 1 (2B) of the RHC did not apply and could not apply to the said Order. The refusal by the defendant to allow the plaintiff the right to execute the said Order after 23.8.2002 had caused anxiety to the plaintiff. It was quite natural. There is indeed a real risk that the documents may have been or may still be tampered with or removed or destroyed by the defendant because the defendant wrongly believed that the said Order had lapsed. Now, consistent with that belief (although it is a wrong belief), there is therefore a real risk that the defendant may deal with the documents in their possession in whatever way they please to the exclusion of the plaintiff. Be that as it may, both the parties agreed that the merits of enclosure 33 and enclosure 16 have not been heard as yet. That being the case, it was pointless to file a notice of appeal as seen in enclosure 36. The sum total of it all would be this: (1) (2) That this court should hear on the merits enclosure 33 first and that the hearing of enclosure 16 should be put in abeyance. [2003] MLJU 81 at 101 That Order 29, rule 1 (2B) of the RHC do not apply to the Norwich Pharmacal Order coupled with the Anton Piller Order that were granted by this court on August 2, 2002.

Addendum In the course of the present proceedings, I was informed at the bar by Mr. Brian Cumming of the untimely demise of Mr. Ramid Khan bin Rahman Khan, the learned counsel for the plaintiff, on October 26, 2002 at a relatively young age of 35. It is unfortunate that such an illustrious member of the bar by the name of Mr. Ramid Khan bin Rahman Khan died at such a young age and at the prime of his career. May his soul rest in

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peace.

Malayan Law Journal Unreported/1996/Volume /BAYER AKTIENGESELLSCHAFT & ANOR v F E VENTURE SDN BHD AND THIRD PARTY - [1996] MLJU 368 - 17 August 1996 46 pages [1996] MLJU 368

BAYER AKTIENGESELLSCHAFT & ANOR v F E VENTURE SDN BHD AND THIRD PARTY
HIGH COURT (SHAH ALAM) LOW HOP BING J SUIT NO 22-477 OF 1994 17 August 1996 Bhag Singh/Ong Chin Beng (Ong Chin Beng & Co) for the plaintiffs. Ranjit Singh/Evelyn Khoo (Cheang & Ariff) for the defendant.

JUDGMENT I. 4 APPLICATIONS There are 4 Applications before me for hearing and determination. These applications are: 1. 2. The Defendant's Application to discharge the ex parte order dated 2.12.94 [Enclosure (12)]; [1996] MLJU 368 at 2 The Plaintiffs' Application for an order that the Defendant do, within 48 hours, place into custody of the Plaintiffs' solicitors, any counterfeit enrofloxacin which may come into its possession after service of any process of the Court, and an injunction against the Defendant's directors, agents and/or servants restraining them from infringing the 1st Plaintiff's patent No. MY-102167A [Enclosure (16)]; The Defendant's Application to: (a) strike out the writ and statement of claim; or (b) alternatively, to strike out the 2nd Plaintiff as one of the Plaintiffs; and (c) security for costs against the 1st Plaintiff [Enclosure (30)] [1996] MLJU 368 at 3 Plaintiff's Application for an order that the items seized by the Plaintiffs on 2.12.1994 be detained in the Plaintiffs' custody, or at a neutral place until the trial of the action herein, or in the alternative, an order that the said items be sent to SIRIM for analysis [Enclosure (47)].

3.

4.

In respect of the Defendant's 2nd Application in Enclosure (30), the Defendant has withdrawn prayer (a) i.e. to strike out the Writ and Statement of Claim. The application for security for costs i.e. prayer (c), is dependant on the Court granting prayer (b) i.e. striking out the 2nd Plaintiff as one of the Plaintiffs. I shall consider and give my decisions in these 4 Applications in the following sequence viz the Defendant's Application in Enclosure (30), the Defendant's Application in Enclosure (12); the Plaintiff's Application in Enclosure (47) and finally the Plaintiff's Application in Enclosure (16). [1996] MLJU 368 at 4

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II.DEFENDANT'S APPLICATION [ENCLOSURE (30)] Counsel for the Defendant submitted that the Writ and Statement of Claim discloses no cause of action by the 2nd Plaintiff against the Defendant and that this cause of action accrued only to the 1st Plaintiff, being an alleged infringement of the 1st Plaintiff's patent. The 2nd Plaintiff's counsel contended that the 2nd Plaintiff has a reasonable cause of action against the Defendant for unlawful interference with trade and unfair competition to the 2nd Plaintiff's exclusive trade in Malaysia. Upon a proper perusal of the Statement of Claim, I note that this action is founded upon an alleged infringement of the 1st Plaintiff's patent. The material averments in the Statement of Claim may be summarised as follows: [1996] MLJU 368 at 5 (1) (2) (3) (4) (5) The 1st Plaintiff is the owner of the registered patent No. MY-102167A in Malaysia (paragraph 2). The 2nd Plaintiff sells and distributes "Baytril" exclusively in Malaysia (paragraph 5). This action seeks to protect the 1st Plaintiff's patent and to restrain the Defendant (and the Intervener) from infringing the said patent (paragraph 11). The Plaintiffs allege that the Defendant committed various acts (with the Intervener assisting the Defendant), which allegedly infringe the 1st Plaintiff's patent (paragraphs 25 and 26). The Plaintiffs seek to recover from the Defendant damages/an account of profits in respect of the alleged [1996] MLJU 368 at 6 infringement of the 1st Plaintiff's patent (paragraph 30).

The 2nd Plaintiff's Statement of Claim [Enclosure (1A)] in so far as it is material to the determination of the Defendant's Application in Enclosure (30), alleges as follows: (1) (2) (3) (4) The 2nd Plaintiff is a subsidiary of the 1st Plaintiff, a German multinational company which deals with, inter alia, chemical, pharmaceutical and veterinary products worldwide (paragraph 1). The 1st Plaintiff is the owner of patent No. MY-102167A in respect of bactericidal formulations for use in the area of veterinary medicine (paragraph 2). The 2nd Plaintiff sells and distributes "Baytril" exclusively in Malaysia (paragraph 5). [1996] MLJU 368 at 7 The 2nd Plaintiff's sales of "Baytril" were affected by the clandestine use and/or sales of counterfeit enrofloxacin not licensed by the 1st Plaintiff (paragraph 6).

Both the Plaintiffs pray that the Court restrains the Defendant (and the Intervener) from interfering or unfairly competing with the Plaintiffs in the export, import, sale or exposure for sale, distribution for the purpose of trade or other dealings in counterfeit enrofloxacin, thereby infringing the 1st Plaintiff's patent. The 2nd Plaintiff avers that it has: (i) (ii) (iii) suffered loss of sales as a result of the Defendant's activities; expended costs on marketing the patented product; and [1996] MLJU 368 at 8 suffered loss of goodwill from the sales of the Defendant's product which is of poor quality and further costs of servicing consumers who complain of the Defendant's product.

For the purpose of determining whether the 2nd Plaintiff has a reasonable cause of action based on unlawful interference with trade and unfair competition, I now apply the relevant sections of the Patents Act 1983 to the specific facts of this case. Under S.36, the 1st Plaintiff as the owner of the patent enjoys various rights including the right to exploit

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(under S.43), assign (under S.39) or license (under S.41) the patent. S.58 deals with infringement and the locus standi to sue for infringement is granted to the owner of the patent: S.59. S.60 provides that upon proving infringement, the owner is entitled to damages and an injunction to prevent further infringement. [1996] MLJU 368 at 9 In a nutshell, it is to be noted that from the provisions of Sections 36, 39, 41, 43, 58, 59 and 60, only the owner of a patent has a cause of action against a person who has committed an infringement of the owner's patent. This cause of action is not vested upon a non-owner of a patent e.g. in the instant case, the 2nd Plaintiff. Under S.61, the licensee can sue, subject to certain conditions e.g. when the owner refuses to institute proceedings. The Statement of Claim has never pleaded that the 2nd Plaintiff is either the owner or a licensee. In the circumstances, under the above provisions of the Patents Act 1983, the 2nd Plaintiff is in no position to establish a right to sue for infringement. It is axiomatic that the 2nd Plaintiff can only have a reasonable cause of action against the Defendant if the 2nd Plaintiff can establish its rights either as an owner or licensee pursuant to the above provisions of the Patents Act 1983 but not otherwise, e.g. [1996] MLJU 368 at 10 where the real reason for the 2nd Plaintiff to sue is to ensure that the undertaking as to damages or costs may be enforced against the 2nd Plaintiff, because the 1st Plaintiff is a foreign company. The reason cannot ipso facto provide a reasonable cause of action based on infringement or for that matter unlawful interference with trade and unfair competition. Since the Defendant's application to strike out the 2nd Plaintiff is based on the ground that the 2nd Plaintiff's Statement of Claim discloses no reasonable cause of action against the Defendant, under O.18 r.19(1)(a) of the Rules of the High Court 1980, the application must be decided by reference to the four corners of the pleading. No affidavit evidence is admissible: 0.18, r.19(2). A thorough reading of the 2nd Plaintiff's Statement of Claim, in particular, paragraphs 1, 2, 5 and 6 therein, as adumbrated above, leads to the inevitable result that it did not disclose any reasonable cause of action against the [1996] MLJU 368 at 11 Defendant based upon infringement of patent or unlawful interference and unfair competition. In any event unfair competition by itself is not an actionable tort and therefore does not give rise to a cause of action. There is indeed no such general cause of action based on unfair competition in our Malaysian jurisdiction. In the absence of clear and express provision of the law enacted by Parliament to create the tort of unfair competition, the 2nd Plaintiff has no cause of action against the Defendant based on unfair competition. In relation to the tort of unlawful interference, I am of the view that the 2nd Plaintiff's Statement of Claim must plead the following ingredients: (a) (b) (c) (d) The Defendant's interference with the 2nd Plaintiff's trade or business; Unlawful means on the part of the Defendant; [1996] MLJU 368 at 12 The Defendant's intention to injure the 2nd Plaintiff; The Defendant's act did in fact injure the 2nd Plaintiff.

(see Bullen and Leake at page 464). The tort of unlawful interference with trade arises when a person e.g. the Defendant deliberately interferes with the trade of another (the 2nd Plaintiff) by unlawful means, in which case, the tortfeasor (the Defendant) is rendered liable in damages. Unlawful means may consist of: (a) (b) (c) misrepresentation; defamation; or breach of a statute, giving rise to criminal sanctions.

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The above ingredients of unlawful interference with trade have not been specifically pleaded in the 2nd Plaintiff's Statement of Claim against the Defendant. [1996] MLJU 368 at 13 By reason of the above, I hold that the 2nd Plaintiff has raised no reasonable cause of action against the Defendant. In the circumstances, I make an order striking out the 2nd Plaintiff as one of the plaintiffs in this case, with costs. III. THE DEFENDANT'S APPLICATION TO DISCHARGE THE PLAINTIFF'S EX PARTE INJUNCTION [ENCLOSURE (12)] The ex-parte injunction obtained by the Plaintiff on 2.12.1994 is primarily an Anton Piller order with ancillary discovery orders. The Defendant relied on the following grounds: 1. 2. 3. 4. 5. The strict requirements for obtaining an Anton Piller order were not met; The Plaintiff's breach of O.29 r.1(2A) of the Rules of High Court; [1996] MLJU 368 at 14 The Anton Piller order is draconian in nature; Execution of the Anton Piller order was oppressive and bad; and The terms of the Anton Piller order contravene the Defendant's privilege against self-incrimination.

It was submitted for the Plaintiff that the order obtained on 2.12.1994 was proper in that all the strict requirements for the obtaining of an Anton Piller order has been fulfilled and should therefore be sustained. The Plaintiff further contended that there was no breach of O.29 of the Rules of High Court and that the Anton Piller order was not draconian and its execution was neither oppressive nor bad. Finally, the Plaintiff submitted that there was no contravention of the Defendant's privilege against self-incrimination. [1996] MLJU 368 at 15 My reasons for allowing the Defendant's application are as follows: 1. The strict requirements for obtaining an Anton Piller order were not fulfilled In order to sustain an Anton Piller order, it is essential that the Plaintiffs comply with the strict requirements for obtaining it. These requirements are: (a) (b) (c) The Plaintiff must show that there is a very clear prima facie case against the Defendant; The Defendant must be in possession of the subject matter assets; and There must be clear evidence that the Defendant would destroy or dispose of the assets. [1996] MLJU 368 at 16

(a) A very clear prima facie case In allowing the Defendant's Application in Enclosure (30) above, I held that the 2nd Plaintiff has no reasonable cause of action against the Defendant. That being the case, the 2nd Plaintiff is in no position to meet the requirement of a strong prima facie case or any case at all. The 1st Plaintiff, on the other hand, relies on the affidavit of one Dr. Leng who was neither an employee nor an agent of the 1st Plaintiff. With the 2nd Plaintiff being struck out, it is doubtful if the 1st Plaintiff is in a position to rely on the affidavit of Dr. Leng. In my opinion, the order which was obtained jointly by the 1st and 2nd Plaintiffs cannot stand and the entire order ought to be discharged in limine. (b) The Defendant must be in possession of the subject matter assets; and (c) there [1996] MLJU 368 at 17

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must be clear evidence that the Defendant would destroy/dispose of the assets In support of these two requirements, the aforesaid Dr. Leng's affidavit made various factual allegations, which are statements of information or belief, but the sources and grounds thereof were not provided, which are, in my view, essential requirements prescribed under O.41, r.5(2) of the Rules of High Court. This non-compliance or contravention renders his affidavit inadmissible: [See Dynacast (S) Pte Ltd v Lim Meng Siang & Ors (1989) 3 MLJ 456 at 459-460; Hari Singh v Sundarammal(1965) 2 MLJ 174 at 175; and Bank Bumiputra Malaysia Bhd & Anor v Lorraine Esme Osman (1986) 1 MLJ 426 at 427-428]. More specifically, in the Dynacast case, an ex parte Anton Piller order granted on the basis of various allegations in the supporting affidavit, which were in breach of O.41, [1996] MLJU 368 at 18 r.5, (of the then Singapore Rules of Supreme Court 1970) was set aside. 2. The Plaintiff's Breach of O.29 r.1 (2A) of the Rules of High Court 1980 O.29 r.1(2A) was inserted by the Rules of the High Court (Amendment) (No. 2) 1993 [PU (A) 364/93] para 2, which is now 3 years of age. Under this rule, it is mandatory for the Plaintiff's affidavit in support to contain a clear and concise statement of, inter alia, the following: (a) (b) (c) (d) (e) (f) (g) ....... ....... of the facts relied on as justifying application ex parte, including details of any notice given to the defendant or, if none has been given, the reason for giving none; ....... [1996] MLJU 368 at 19 ....... of whether any previous similar ex parte application has been made to any other Judge, and if so, the order made in the previous application; and of the precise relief sought.

This rule is intended to ensure that the remedy of an ex parte injunction is not misused and abused by litigants. The aforesaid mandatory requirements must be meticulously and strictly complied with. A failure to do so, as in the instant case, must necessarily and inevitably result in the discharge of the injunction in limine. The Plaintiffs are not at liberty to disregard the above. 3. The Anton Piller order is draconian in nature [1996] MLJU 368 at 20 An Anton Piller order is by its nature a draconian order in that it allows the Plaintiff, without prior notice to the Defendant, to raid the Defendant's premises. In the light of its draconian nature, an Anton Piller order will only be made if special undertakings are given to the Court e.g. (i) (ii) (iii) as to damages; that service of the order will be undertaken by a solicitor who will explain the terms of the order to the Defendant and advise the Defendant to seek immediate advice; that the solicitor serving the order will supply the Defendant copies of all the affidavits and other documents that were put before the judge at the time [1996] MLJU 368 at 21 of the granting of the ex parte order; and not to use the information and documents obtained except for the purpose of the civil suit.

(iv)

Further, the Anton Piller order should also give liberty to the Defendant to apply to the court on short notice to discharge the order: See "Injunction - A Practical Handbook" by N R Burns pp. 76-80; Booker McConnell plc and Anor v Plascow (1985) RPC 425; Universal Termosensors Ltd v Hibben & Ors(1992) 3 All ER 257 and Practice Direction (1994) 4 AER 52-56; and "Pre-Trial Discovery" by David Fletcher Rogers pp. 67-79. 4. Execution of the Anton Piller order was oppressive and bad

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[1996] MLJU 368 at 22 Upon being served with an Anton Piller order, it is incumbent upon the Defendant to strictly obey the order (even if it is bad). The Defendant's duty is equally matched by the Plaintiff's duty, in executing its order, to ensure that the terms of the Anton Piller order in the instant case are strictly complied with. These terms are as follows: (a) (b) only 3 representatives of the Plaintiffs together with a Police officer are allowed to enter the purported offending premises; and upon delivery up of the purported offending goods to the Plaintiffs, their agents, and/or servants or Plaintiffs' solicitors, a receipt of acknowledgement of the purported offending goods must be issued to the Defendant, [1996] MLJU 368 at 23 after the necessary photographs of the alleged counterfeit enrofloxacin have been taken.

In the instant case, when executing the order, 8 persons raided the premises and no receipt of acknowledgement was issued to the Defendant. Further, the solicitor leading the raid gave or offered no explanation of the effect of the Anton Piller order and of the right to take legal advice. The explanation, if any, was purportedly given by the solicitor's clerk who is not a solicitor (i.e. an advocate and solicitor admitted by our High Court). The relevant cause papers were not served on the Defendant. The clerk stated that the receipt was not issued to the Defendant because one Mr. Lim Kok Wah refused to sign it. However Dr Leng stated that one Mr Tiang and the aforesaid Mr Lim had disappeared at the [1996] MLJU 368 at 24 end of stock-taking. This inconsistency has materially and adversely affected the credibility of the Plaintiff in relation to the issuing of the receipt of acknowledgement to the Defendant. Plaintiffs have further stated that upon seizure, 5 samples were given to Sirim for analysis. This was never a term of the order and hence, the scope and ambit of the order has been exceeded without any legal basis or authority. The combined effect, of all the above breaches, results in an unfair and oppressive execution of the order. The effect of such oppressive execution must inevitably be the discharge of the order and the return of the goods seized: AB v. CDE (1982) R.P.C. 509; Manor Electronics Ltd And Another v. Dickson and Others (1988) R.P.C. 618; VDU Installations Ltd v. Integrated Systems & Dybernetics Ltd. August 13, 1988 The Times, England. [1996] MLJU 368 at 25 5. The terms of the Anton Piller order contravene the Defendant's Privilege against self-incrimination The common law rule entitles a Defendant to claim the privilege against self-incrimination so that the Defendant is entitled to refuse to give discovery, on the ground that by doing so, the Defendant would tend to incriminate himself. Hence, an Anton Piller order will be discharged if disclosure would expose the Defendant to criminal charges. Enrofloxacin is an antibiotic regulated by the Poisons Act, 1952. As an antibiotic, it is expressly stated in the Poisons List set out in the First Schedule to the Poisons Act 1952, as amended from time to time in accordance with S.6 of the Act (see S.2). Production of enrofloxacin in the discovery order would incriminate the Defendant in that evidence which is provided by the Defendant could lead to [1996] MLJU 368 at 26 the prosecution of the Defendant for offences under e.g.S.8 to S.17 of the Poisons Act 1952. In the 1980s and 1990s, as a result of various conflicting judicial decisions in this area of the law, it is now necessary for me to engage in a closer examination and inquiry as to whether S.132 of the Evidence Act, 1950 has done away with the common law rule in relation to the privilege against self-incrimination.

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It seems to me that the express provisions of S.132 have eroded the privilege against self-incrimination in that a witness shall not be excused from answering any question, upon the ground that the answer to that question will incriminate or may tend directly or indirectly to incriminate him, or will expose, or indirectly to expose, the witness to a penalty or forfeiture of [1996] MLJU 368 at 27 any kind. The crux of the matter lies in the meaning of 'witness'. Does 'witness' include a person served with an Anton Piller order ordering the discovery of articles, things, assets or documents? If such a person is a witness, then Section 132 has the effect of abolishing the privilege against self-incrimination vis-a-vis an Anton Piller order. However, if the converse be true i.e. that 'witness' does not include such a person, then that person is entitled to claim the common law privilege against self-incrimination. The determination of this important question will require an arduous analysis of the cases in Malaysia and Singapore, which may be summarised as follows: (i) Television Broadcasts Ltd & Ors v. Mandarin Video Holdings Sdn Bhd (1983) 2 MLJ 346, N H Chan J (now JCA) recognised the common law position. His Lordship, [1996] MLJU 368 at 28 however, held that S.132 withdrew such a privilege. In respect of the meaning of 'witness', his Lordship held that a person producing a document or who furnishes evidence under the compulsion of a court order e.g. an Anton Piller order, is a witness; In P.M.K. Rajah v. Worldwide Commodities Sdn. Bhd. & Ors (1985) 1 MLJ 86, Zakaria J (now JCA) considered the Television Broadcasts case supra, and expressly disagreed with it. With regards to the meaning of 'witness', his Lordship held that a person merely producing a document is not a witness. Further, his Lordship held that a witness is a person who testifies at a trial and who is subject to oral examination in open court. Hence, a person who is merely served with an Anton Piller order [1996] MLJU 368 at 29 is not a 'witness' within the meaning of S.132 the Evidence Act 1950. In Riedel-de-Haen AG v. Liew Keng Pang (1989) 2 MLJ 400 where Chan Sek Keong J, a judge of the High Court of Singapore (now Attorney-General, Singapore) considered in depth the above conflicting decisions and held in favour of the P.M.K. Rajah case. He held that a witness is a person giving oral testimony in judicial proceedings, and thus, a person served with an Anton Piller order could claim the common law privilege against self-incrimination. In Arjunan& Ors v. Kesatuan Kebangsaan Pekerja-Pekerja Ladang & Ors (1993) 1 MLJ 326, Abu Mansor J (now JCA) followed the P.M.K. Rajah case, supra, and discharged the Anton Piller order [1996] MLJU 368 at 30 on the grounds, inter alia, that the Defendant could claim the privilege against self-incrimination. His Lordship did not appear to have considered the Television Broadcasts case, supra. In Attorney-General of Hong Kong v. Zauyah Wan Chik & Ors and another appeal (1995) 2 MLJ 620, our Court of Appeal appeared to have accepted the Television Broadcasts case, supra, in so far as it is authority for the proposition that S.132 the Evidence Act 1950 does away with the common law privilege against self-incrimination.(See the judgment of Gopal Sri Ram JCA at page 631 and judgment of NH Chan JCA at page 641).

(ii)

(iii)

(iv)

(v)

Learned counsel for the Plaintiffs cited the Zauyah case, supra, as authority for the proposition that the privilege [1996] MLJU 368 at 31 against self-incrimination does not exist in favour of the recipient of an Anton Piller order in the instant case. Upon a proper perusal, I note that in the Zauyah case, supra, the Court of Appeal was dealing with the situation of witnesses giving evidence at a trial. Rightfully, therefore, S.132 applies. The Court of Appeal was not concerned with the position of a defendant who has been served with an Anton Piller order. The learned appeal judges therefore were not called upon to consider the meaning of 'witness' vis-a-vis the

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recipient of an Anton Piller order. Had they been called upon to consider this question, the Court of Appeal judges would have had the opportunity to consider the four previous cases preceding it and then make a decision either leaning in favour of the Rajah case or the Television Broadcasts case. The Court of Appeal in the Zauyah's case held, inter alia, that the common [1996] MLJU 368 at 32 law privilege against self-incrimination has been removed by S.132(2) of the Evidence Act 1950, e.g. in a situation in which a court in Malaysia is recording evidence, in a judicial proceeding in which a person is called to the court to give evidence as a witness and not e.g. a person who is merely served with an Anton Piller order. It is therefore my conclusion that the Zauyah's case, supra, is not the authority for the proposition that the common law privilege against self-incrimination is removed vis-a-vis the recipient of an Anton Piller order. On my part, I am inclined to the proposition that a person who is merely served with an Anton Piller order does not ipso facto become a witness and therefore S.132 has no application to him, in which case, the common law privilege against self-incrimination gives him the necessary protection. [1996] MLJU 368 at 33 On the foregoing grounds, I hereby discharge the injunction given on 2.12.1994, (which includes an Anton Piller order) and make an order in terms of the Defendant's Application in Enclosure (12). The above 2 decisions viz in respect of Enclosures (30) and (12) were given on the 10th July 1996. IV.PLAINTIFF'S APPLICATION IN ENCLOSURE (47) 1. Orders sought This application by the Plaintiff asks for the following reliefs: 1. That the items seized by the Plaintiffs abovenamed ("the said confiscated items") on the 2nd day of December 1994 at a double dwelling house located at Taman Subang Indah bearing No. 42, Jalan PJS 10/7A, Selangor Darul Ehsan, the [1996] MLJU 368 at 34 details of which are contained in the exhibits marked "B", "C", "D", "E" dan "F" referred to in paragraph 27 of the Statement of Claim be detained in the Plaintiffs' custody or at a neutral party's premises, fully secured and safeguarded, until the decision of the trial of the action herein; or, In the alternative, that every item of the said confiscated items be analysed by Standards& Industrial Research Institute of Malaysia (SIRIM) for the purpose of determining the presence of generic enrofloxacin therein and which is to be confirmed by a labortory report to be issued by SIRIM.

2.

The grounds of this application are:a) b) that the said confiscated items are relevant evidence in [1996] MLJU 368 at 35 support of the Plaintiffs' claim against the Defendant and the Intervener; the Plaintiff's claim will be prejudiced if the said confiscated items are not available at the trial of the action.

2. Preliminary Objection by the Defendant At the outset of the hearing of this Application, learned counsel for the Defendant raised a preliminary objection that on 10.7.1996, this Court had granted an order in items of the Defendants' two applications viz, vide Enclosures (30) and (12), to the following effect: (1) that the Anton Piller order obtained by the Plaintiffs be discharged or set aside;

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(2) (3) (4)

[1996] MLJU 368 at 36 that all items seized by the Plaintiffs be returned to the Defendants forthwith; that the 2nd Plaintiff be struck out as a Plaintiff; and that the 1st Plaintiff do provide RM10,000-00 as security for costs.

It was submitted for the Defendant that the Plaintiffs' learned counsel for the Plaintiffs had on 10.7.1996 informed the Court that the Plaintiffs had instructions to appeal against the aforesaid decisions and so prayed for a stay of the execution of the said orders in paragraphs (1) to (4) above, in particular, the return of the goods seized from the Defendant's premises. The interim stay was granted pending the filing of a formal application. However, until the hearing of this [1996] MLJU 368 at 37 Application in Enclosure (47) today, there was no application for stay pending appeal, neither was there any appeal filed by the Plaintiffs as at the date the decision in respect of this Application in Enclosure (47) was given i.e. 30.7.96, against any of the aforesaid decisions viz. in respect of Enclosures (30) and (12). Learned counsel for the Plaintiff contended that the Plaintiffs' claim is based on an infringement by the Defendant under S.58 of the Patents Act 1983. He added that the seized items are necessary as evidence to support Plaintiffs' claim. His submissions, at great length, focussed essentially on what was submitted by his co-counsel in the hearing of the Applications in Enclosures' (30), (12) and (16). On 10.7.1996, I gave my decisions on Enclosures (30) and (12). [1996] MLJU 368 at 38 3. Decision on Enclosure (47) The Plaintiffs' application today is not for a stay of the orders made by me in respect of Enclosures (30) and (12) on 10.7.1996. The affidavit in support of this Application in Enclosure (47) does not say that an appeal has been filed against the aforesaid decisions. The aforesaid decisions made on 10.7.1996 are binding on all the parties thereto and any attempt to obtain a stay of the aforesaid decisions must be supported by a formal application, in which the affidavit in support must exhibit, inter alia, a notice of appeal against the aforesaid decisions. The Plaintiffs did not take any of these steps. Instead, the Plaintiffs have filed this Application in Enclosure (47) which, I conceive, is a step taken for the purpose of varying, setting aside or nullifying the terms of the aforesaid orders. I am unable to allow the Plaintiffs' Application in prayer (1) or [1996] MLJU 368 at 39 the alternative in prayer (2), because after the aforesaid decisions were pronounced, the Court was functus officio and hence is in no position whatsoever to vary, set aside or nullify its own decisions, which were arrived at after considering numerous volumes of cause papers, affidavits and exhibits. The aforesaid decisions were final and conclusive in so far as this Court is concerned. It is fundamental that the aforesaid decisions can only be varied, set aside or nullified by a court of higher jurisdiction i.e. the Court of Appeal. It is axiomatic that this Court is not the proper forum for hearing this Application which, as I have stated above, was taken by the Plaintiffs for the aforesaid avowed purposes. Unless and until the aforesaid orders of the Court are set aside, the parties herein are bound by these orders and any application such as the Plaintiffs' Application in Enclosure (47), which is intended to vary, set aside or nullify the aforesaid orders, cannot be allowed. [1996] MLJU 368 at 40 In the circumstances, I dismiss the Plaintiffs' Application in Enclosure (47) with costs and, pursuant to the aforesaid orders made by me Enclosures (30) and (12), order that all items seized by the Plaintiffs from the Defendants on 2.12.1994 be returned to the Defendant, within 7 days of the service of this order on the Plaintiffs. This decision was given on 30.7.1996. V. PLAINTIFFS' APPLICATION FOR INJUNCTION PENDING TRIAL [ENCLOSURE (16)] The prayers asked for in this Summons in Chambers dated 16 December 1994 are substantially the same as those which were asked for in the Plaintiff's Summons in Chambers [Enclosure (4)] and for which an order was granted and made by this Court on 2 December 1994 [Enclosure (5)]. However, the said order has

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lapsed through the effluxion of time. Hence the need to make this application. [1996] MLJU 368 at 41 The order that the Plaintiffs now seek is to the following effect: 1. 2. 3. That the Defendant do within forty-eight (48) hours place into the custody of the Plaintiffs' solicitors any counterfeit enrofloxacin which may come into their possession after service of any process of this court upon them; That the Defendant, by their Directors, servants and/or agents or otherwise howsoever, be restrained from infringing the 1st Plaintiff's Malaysian Patent Number MY-102167A; That the Defendant, by their Directors, servants and/or agents or otherwise howsoever, be restrained from interfering or unfairly competing with the Plaintiffs in the export, import, [1996] MLJU 368 at 42 sale or exposure for sale, distribution, for the purpose of trade or other dealing in counterfeit enrofloxacin infringing the 1st Plaintiff's Malaysian Patent Number MY-102167A.

The prayers sought by the Plaintiffs in this Application in Enclosure (16) are in effect an injunction including an Anton Piller order and has been dealt with by me when I gave my grounds of judgment in the Defendant's Application in Enclosure (12), wherein I have set aside the Order granted on 2.12.1994. Subsequently, the Plaintiffs in Enclosure (47) have, in prayer (1) therein, asked for the seized items to be detained in the Plaintiffs' custody which I heard on 24.7.1996 and the decision thereon was given on 30.7.1996. The issues involved in these Applications viz. in Enclosures (12), (47) and now (16) are substantially the same. In the circumstances, it is not necessary for me to deal with this Application in Enclosure (16) for the third [1996] MLJU 368 at 43 time, on the same or substantially the same issues, asking for an order having the same or substantially the same effect. Furthermore, the grounds of judgment have also been given in the previous two Applications viz Enclosures (12) and (47). Another application in Enclosure (16) is now before me for hearing and determination. Be that as it may, in deference to the submissions advanced by the respective learned counsel, I shall now move on to deal with this application in Enclosure (16). The affidavits in support of the Plaintiffs' Application in Enclosure (16) are affirmed by one Dr. Leng Seah Woon on 2.12.1994 [Enclosure (2)], Dr. Choo Wai Hong [Enclosure (17)], Encik I. Jeganathan [Enclosure (18)] and Dr. Chiang Boon Leong [Enclosure (19)], all of which were affirmed on 15.12.1994. Except for the affidavit of Dr. Leng Seah Woon in Enclosure (2), the other three affidavits [Enclosures (17), (18) and (19)] were affirmed for the purpose [1996] MLJU 368 at 44 of explaining how the ex parte Order was executed and, truly speaking, was not in support of the application for injunction in Enclosure (16). Enclosure (2) was the Plaintiffs' 1st affidavit in support of the Plaintiffs' Application for injunction in Enclosure (4) which, as stated above, has been discharged as it has lapsed through the effluxion of time. In the Plaintiffs' affidavit in support, the deponent is one Dr. Leng Seah Woon who is the Veterinary Divisional Manager of the 2nd Plaintiff. The 2nd Plaintiff has been struck out as one of the plaintiffs, pursuant to my order dated 30.7.1996. In paragraph 11 of the said affidavit, the deponent stated as follows:
"Sometime in late October, 1993, I received information from one of the Second Plaintiff's customers that the Defendant was selling counterfeit enrofloxacin at a much lower price than the genuine enrofloxacin sold by the Plaintiffs.". [1996] MLJU 368 at 45

The Defendant challenged this paragraph of the affidavit on the ground that it has contravened O.41, r.5(2) of the Rules of High Court 1980. The Plaintiffs' response is that there has been no contravention with O.41, r.5(2) and there is no defect in the

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said affidavit. In my judgment, I am of the view that any factual allegation based on information, as stated in paragraph 11 of the said affidavit, must be supported by the sources and grounds thereof. This is the clear and undoubted requirement of O.41, r.5(2) which reads as follows:
"(2) An affidavit sworn for the purpose of being used in interlocutory proceedings may contain statements of information or belief with the sources and grounds thereof." (emphasis added). [1996] MLJU 368 at 46

Paragraph 11 of the said affidavit reflects the single most important paragraph which touches and concerns the alleged selling of the so-called counterfeit enrofloxacin, which is based on information, which must comply with the strict requirements of the provisions prescribed by O.45, r.5(2) above. A mere reference to "the Second Plaintiff's customers" without naming the specific sources and grounds thereof cannot be said to have complied with the strict requirements of O.45, r.5(2). A contravention of O.41, r.5(2) would result in the inadmissibility of this paragraph for the purpose of obtaining the ex parte order: Dynacast (S) Pte Ltd v. Lim Meng Siang & Ors [1989] 3 MLJ 456 at 459-460; Hari Singh v. Sundarammal [1965] 2 MLJ 174 at 175; Bank Bumiputra Malaysia Bhd & Anor v. Lorraine Esme Osman [1986] 1 MLJ 426 at 427. I hereby adopt my grounds of judgment when I gave my decision on the Defendant's Application in Enclosure (12) above, in particular [1996] MLJU 368 at 47 III.1.(b) and (c). I am unable to give the order in terms of the Plaintiffs' Application in Enclosure (16). I therefore dismiss Enclosure (16) with costs and order an early hearing of the main suit herein.