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Writer's pictureJX GOH

Bank Negara Malaysia v Mohd Ismail & Ors [1992] 1 MLJ 400

This case laid down the requirements for a summary judgment.

 

Facts of the Case


The first Respondent (Mohd Ismail) had entered into a scholarship agreement with the Appellants (Bank Negara Malaysia) on 21.07.1980. According to the scholarship agreement, the Respondent undertake to work for the Appellant for 10 years upon completion of his studies. It was in the terms that if the Respondent breach the agreement, he would need to pay $70,000 to Appellant as penalty.


the first Respondent resigned a few months after having commenced employment with them. The Appellants claimed liquidated damages in the sum of $70,000 against the first Respondent (Mohd Ismail) and his sureties for breach of a scholarship agreement entered into by the first Respondent with the Appellants.


The first Respondent had written letters to the Appellant to allow him to pay the sum of $70,000 by way of monthly instalment. The Appellants referred to three letters written by the first Respondent to support their application for summary judgment. Two letters, in particular, each contained an unequivocal admission of liability for breach of the agreement. In reply, the Respondents claimed that the Appellants had breached a condition of the agreement to provide the first respondent with a post consistent with his qualifications and that therefore the first respondent's undertaking to serve the appellants was extinguished. It was averred that the sum of $70,000 was a penalty, and the questions of waiver and estoppel were also raised as triable issues.


The senior assistant registrar was satisfied on the affidavit evidence that there was no triable issue and accordingly entered judgment against the respondents. On appeal, the High Court judge set aside the order of the registrar and issued a certificate of no further argument. The appellants appealed.



Judgment of the Court


The Supreme Court held that in an application under O 14, the court has to be satisfied on affidavit evidence that the defence has not only raised an issue, but also that the said issue is triable. The determination of whether an issue is or is not triable depends on the facts or the law arising from each case as disclosed in the affidavit evidence before the court. A complete defence need not be shown. The defence set up need only show that there is a triable issue.


Under an O 14 application, the duty of a judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other in an affidavit. Where such assertion, denial or dispute is equivocal, or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent, or is inherently improbable in itself, then the judge has a duty to reject such assertion or denial, thereby rendering the issue not triable. Unless this principle is adhered to, a judge is in no position to exercise his discretion judicially in an O 14 application.


Where the issue raised is solely a question of law without reference to any fact or where the facts are clear and undisputed, the court should exercise its duty under O 14. If the legal point is understood and the court is satisfied it is unarguable, the court can grant a summary judgment.


The learned High Court judge erred in law in taking the assertion of the first Respondent regarding the unsuitability of the post offered to him by the appellants as a triable issue on affidavit evidence, having regard to the unequivocal admission of liability by the first Respondent to pay the Appellants $70,000 for breach of contract. Liability was admitted without qualification and only the mode of payment was in dispute.


On the facts and circumstances of this case, the issue of estoppel and waiver ought to have been rejected because there was obviously no triable issue either on estoppel or waiver.


The learned judge had erred in law in not allowing the summary judgment by accepting uncritically the assertions of the scholar made on behalf of all the respondents, although they were equivocal, lacking in precision as well as inconsistent with undisputed contemporary documents. Thus, appeal is allowed.



Principles of the Case


In order to succeed in an application for Summary judgment under O.14, the requirement is that there is no triable issue raised by the Defendant. If there is any assertion which is inconsistent with undisputed documents, the court has a duty to reject such assertion and render it not triable. The court can still grant a summary judgment where issue raised is solely a question of law.

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