Introduction

In the above recent decision, the Court of Appeal considered the setting aside of a Judgment in Default and the leave for extension of time that was sought to file a Memorandum of Apperance and Statement of Defence. The relevant provision that the Court considered was Order 13 Rule 8 Rules of Court 2012 where the Court is vested with the discretion to set aside or vary any Judgment entered on such terms as the Court deems fit.

Brief Facts

• The Respondent is a law firm having 6 lawyers with areas of practice in banking, property, corporate and insurance.
• Respondent decided to expand its area of practice to include motor insurance in the year 2012.
• The Respondent appointed the Appellant as a legal assistant on 3 October 2012 having been convinced that he was experienced in the field of motor insurance.
• A total of RM1,620,730 was provided by the Respondent to the Appellant for the expansion in the field of motor insurance.
• The Appellant however ceased turning up for work from 30 September 2014.
• The Appellant's appointment was terminated after 3 letters had been issued requiring the appellant to report for work.
• Following an internal investigation, the respondent found that the appellant had failed to diligently carry out his duties as a result of which it suffered loss.
• The Respondent initiated proceedings against the Appellant for the refund of RM1,620,730 given as a loan, general damages and interest.
• Judgment in default of appearance was entered against the Appellant on 18 January 2016 for the sum of RM1,620,730 together with interest.
• The Respondent commenced bankruptcy proceedings against the Appellant.
• The Appellant filed an application to set aside the Judgment In Default on 23 February 2018, that it was irregular, for time to enter appearance and filing of defence and for the receiving and adjudication orders dated 6 April 2017 to be annulled.
• The application was dismissed by the High Court on the basis that the judgment in default was regular, that there was unaccountable delay in the application and that there were no merits in the defence.
• Hence the Appeal to the Court of Appeal.

Decision

By a majority decision the Court of Appeal allowed the Appeal on the setting aside application. Their reasons can be summarised as follows:-

Mary Lim(JCA) & Nor Bee(JCA)

• The Court found that the Judgment that was entered was regular and what was to be considered then in a setting aside appeal was the merits of the defence (defence on the merits raised) and the issue of delay that was raised.
• In deciding the issue of delay, what was to be considered was whether the delay was reasonably accounted for.
• The Court accepted the explanation of the Appellant that he had difficulty in obtaining supporting evidence as none of the agents in the firm were in speaking terms with him and he had no access to the documents having left the employment in the year 2014.
• Only when Bankruptcy proceedings were filed against him that one of the agents had stepped forward to affirm an affidavit for the Appellant in May 2017.
• Court held that the Appellant was not an indolent litigant who did not warrant the aid of the Court.
• The majority held that the Appellant had satisfactorily displayed a good defence of merit.

Conclusion

The decision shows the sentiments of the Courts in wanting to give a litigant their day in Court in the interest of justice and fairness rather than dismissing a case on the issue of delay without affording the opportunity to show the defence on merits.

No doubt there was a dissenting Judgment by JCA Rhodzariah Bujang on the inordinate delay in filing the setting aside application, but decision of the majority which prevailed is fair based on the peculiar factual matrix of the case.

The particular facts of each case as presented before the Honourable Panel of Judges is of vital importance in the decision as arrived at and the discretion as exercised. A litigant who seeks the aid of the Court and the syampathy of the Court where there is a delay must of course come to Court with clean hands and be candid on the said facts if a favourable decision is hoped more so where there is an inordinate delay in moving the Court.

In this regard, one can only be reminded of the well known decision of Tan Lay Soon V Kam Mah Theatre Sdn Bhd (Malayan United Finance Bhd, Intervener) 1992 2 MLJ 434 where Edgar Joseph Jr J (as he then was, latter Federal Court Judge) had this to say:

“It is axiomatic that every judgment must be read as applicable to the particular facts proved, since the generality of expressions which may be found there are not intended to be the expressions of the whole law, but governed and qualified by the peculiar facts of the case in which such expressions are found. So, too, expressions of judges must be understood in relation to the subject matter before the Court”.