Tort: Negligence - Breach of trust - Claim by plaintiffs against defendant bank for breach of trust and negligence in releasing part of surplus proceeds realised from an auction sale of their land to third party - Burden of proof - Adverse inference - Whether bank liable for unauthorised release of part of balance monies after auction of land

Civil Procedure: Appeal - Cross-appeal - Notice of - Whether notice of cross-appeal incompetent as subject matter of cross-appeal had no connection whatsoever with appeal - Whether notice of cross-appeal should be struck out

The 1st and 2nd Plaintiffs were the registered Trustees of a society ('Society'), while the 3rd to the 6th Plaintiffs were the office bearers of the Society. The High Court had dismissed the Plaintiffs' claim against the Defendant, Bank Islam Malaysia Berhad ('Bank'), for breach of trust and negligence in releasing part of the surplus of the proceeds realised from an auction sale of their land of RM2.34 million to the 1st Third Party ('1st TP'). A previous High Court had held that the Power of Attorney given by the Society to the 1st TP was fraudulently procured and null and void. The decision was affirmed in the Court of Appeal and leave to appeal further to the Federal Court had been dismissed. Consequently, the High Court had also dismissed the Bank's claim against all the Third Parties ('TPs'), including the 2nd and 3rd TPs, who were partners of the legal firm that had represented the Bank in the public auction pursuant to an order for sale obtained upon default of the Society's loan from the Bank. However, the High Court went on to hold that the Bank had not relied on any advice of its solicitors when it came to the release of the said RM2.34 million to the 1st TP. A balance sum of RM1,312,025.98 was released by the Bank to the Society.

Aggrieved, the Plaintiffs filed the present appeal. The finding of the High Court Judge ('HCJ') that was the subject of serious challenge by the Plaintiffs was that with the admission of an Impugned Letter as an exhibit, the Plaintiffs had effectively waived their rights under s 268(1)(3) National Land Code and the Defendant had been discharged of liability. This Impugned Letter was raised and relied upon by the Bank in its defence as a representation by the Society to apportion the auction surplus on the terms set out in that letter. The Bank filed a notice of cross-appeal against the decision of the High Court, and prayed that the decision of the High Court be affirmed but that certain findings of fact against it with respect to the TPs be reversed. The Plaintiffs raised a Preliminary Objection ('PO') that the notice of cross-appeal was incompetent as the subject matter of the cross-appeal had no connection whatsoever with the Plaintiffs' claim for breach of trust and negligence against the Bank.

Held (unanimously allowing the appeal; allowing the PO by majority decision):

Per Gunalan Muniandy JCA (allowing the PO by majority):

(1) The HCJ had, on the facts, misdirected herself and misapplied the principles pertaining to the application of s 114(g) Evidence Act 1950 ('EA') in drawing an adverse inference as the Impugned Letter was relied upon by the Bank as its defence to the Society's claim; it was material only to its version of events. Hence, it followed that the burden therefore lay with the Bank to prove the same and to discharge this burden in respect of this particular fact. The onus had not shifted to the Plaintiffs, as the HCJ had wrongly held, to produce the necessary evidence and witnesses on this fact in issue, including calling the 6th Plaintiff who was crucial to the Bank's defence and not the Plaintiffs' claim. The failure or omission to do so should have been held to be to the Bank's detriment that would also attract an adverse inference under s 114(g) EA against the Bank's defence. (para 43)

(2) Under the law, no Power of Attorney could be validly given to confer authority on a third party, in this case the 1st TP, to receive part of the balance proceeds of the auction sale of the Society's land. In fact, since the Power of Attorney supposedly given by the Trustees of the Society to the 1st TP had been declared to be null and void for being fraudulent, the Bank could not validly release the sum of RM2.34 million to an unauthorised third party. Therefore, the Bank had to be held liable for wrongful release of the monies claimed as well as for being negligent in not properly verifying the valid signatories of the Society. The HCJ had been plainly wrong in arriving at her decision that the Bank was not liable at all for the unauthorised release of the RM 2.34 million after the auction of the land. (para 44)

(3) The PO was supported by the law and the relevant Federal Court cases. Notwithstanding a Court of Appeal's decision by another panel, as the Plaintiffs were not parties to that motion, they were entitled to raise the PO here and were not bound by that decision of the previous Court of Appeal on an important point of law. It was a settled principle that a question of law might rightly be raised at the appellate stage before delivery of judgment. The grounds of the cross-appeal were not related whatsoever to the appeal. Thus, the PO should be allowed and the notice of cross-appeal should be struck out. (para 51)

Per Lee Swee Seng (dismissing the PO by minority):

(1) The Court must look at the substantive justice of the case. It was abundantly clear that the pith and substance of the appeal was against the findings of fact of the High Court in dismissing the Bank's claim against the TPs and to preserve the Bank's right on appeal, in the event that the Court of Appeal should allow the Plaintiffs' appeal and allow judgment to be entered for RM2.34 million against the Bank. There was nothing wrong with that exercising of the Bank's defensive appeal which was only applicable should the Plaintiffs succeed in their appeal. Whilst the Bank could always argue against the Plaintiffs' appeal with respect to the High Court dismissing their claim against the Bank, without the need to file any notice of appeal or notice of cross-appeal vis-a-vis the Plaintiffs, the Bank would have to file a notice of appeal against the TPs in order to argue that judgment should correspondingly be entered by the Bank against the TPs. (paras 84-86)

Case(s) referred to:

Desa Samudra Sdn Bhd v. Bandar Teknik Sdn Bhd & Ors [2011] 1 MLRA 838; [2012] 1 MLRA 199 (folld)

Douglas Ding Jangan & Ors v. Kerajaan Negeri Sarawak & Ors [2021] 5 MLRA 259 (folld)

Dr Chong Eng Leong v. Harris Mohd Salleh [2017] 1 SSLR 607; [2017] 4 MLRA 382 (folld)

Gondola Motor Credit Sdn Bhd v. Almurisi Holdings Sdn Bhd [1992] 1 MLRA 162 (refd)

Kabushiki Kaisha Ngu v. Leisure Farm Corp Sdn Bhd & Ors [2016] 6 MLRA 373 (folld)

Keng Soon Finance Berhad v. MK Retnam Holdings Sdn Bhd & Anor [1989] 1 MLRA 53 (refd)

Kimlin Housing Development Sdn Bhd v. Bank Bumiputra Malaysia Bhd & Ors [1997] 1 MLRA 267 (refd)

Letchumanan Chettiar Allagappan @ L Allagappan & Anor v. Secure Plantation Sdn Bhd [2017] 3 MLRA 501 (refd)

Pengerusi Suruhanjaya Pilihanraya Malaysia (Election Commission Of Malaysia) v. See Chee How & Anor [2015] 6 MLRA 353 (refd)

Re Cavander's Trusts [1881] 16 Ch D 270 (folld)

RHB Bank Berhad v. Dominance Timber Industries Sdn Bhd & Ors And Another Case [2008] 4 MLRH 191 (folld)

Sembagavally Murugason v. Tee Seng Hock [2019] 5 MLRH 512 (refd)

Sinarlim Sdn Bhd v. Medallion Builders Sdn Bhd [2012] 6 MLRH 426 (distd)

United Malayan Banking Corp Bhd v. Chong Bun Sun & Another Case [1994] 1 MLRH 331 (refd)

Legislation referred to:

Courts of Judicature Act 1964, ss 67(1), 69(5)

Evidence Act 1950, ss 67, 101, 114(g)

National Land Code, s 268(1)(3)

Rules of Court of Appeal 1994, rr 5, 8, 102, 103, 104, 105

Counsel:

For the appellants: Shahareen Begum Abdul Subhan; M/s Shahareen Begum

For the respondent: Suhaidi Zakaria (Mawar Nur Izzati Md Zamri with him); M/s Mastura & Associates

For the 2nd & 3rd third parties: Ng Kong Peng (Yok Jiang Lin with him); M/s KP Ng & Amardas

JUDGMENT

Gunalan Muniandy JCA (allowing the PO by majority):

Introduction

[1] The Appellants who were Plaintiffs in the High Court have appealed against the whole of the decision of the Learned High Court Judge ['LJ'] who dismissed the Plaintiffs' claim with costs of RM25,000.00. Thereafter, the Respondent who was the Defendant in the Court below filed a cross-appeal in respect of their Third Party ['TP'] claim.

Summary Of Facts

[2] The Plaintiffs are the trustees and the current office bearers of a society known as Persekutuan Guru-Guru Melayu Johor ['PGMJ'].

[3] PGMJ was the beneficial owner of a piece of land held under GRN No 95172 Lot 229, Bandar Maharani, Daerah Muar Johor. The Property was charged to the Defendant, as security for a loan granted by the Defendant to PGMJ.

[4] Upon PGMJ's default to repay the loan, the Defendant auctioned the Property at a public auction for RM4.9 million on 4 July 2011.

[5] After deducting the outstanding sum owing to the Defendant, there was a balance of auction proceeds of RM3,652,025.98.

[6] On 25 November 2011, an individual named Omar Kassim, the 1st Third Party ['the 1st TP'] lodged a private caveat on the Property on the ground that he was the lawful holder of a Power of Attorney given by PGMJ.

[7] The legal firm of Messrs Sabaruddin Ali & Co ['the Firm') acted for the Defendant in respect of the auction. At all material times, Zul Azam Md Dahlan, the 2nd Thirty Party ['the 2nd TP'], a partner of the Firm was the solicitor having conduct of the matter. Sabaruddin Ali, the 3rd Third Party ['the 3rd TP'] was the other partner of the Firm.

[8] On 18 January 2012, the Defendant released a portion of the balance proceeds in the sum of RM2,340,000.00 to the 1st TP. The remaining portion of RM1,312,025.98 was released to PGMJ.

[9] A dispute arose between PGMJ and the Defendant as PGMJ alleged that they did not authorize the release of RM2,340,000.00 to the 1st TP.

[10] On 13 January 2018, the Plaintiffs as the trustees and the office bearers of PGMJ commenced High Court Suit No JB22NCvC-11-01/2018 ['High Court Suit'] against the Defendant claiming, inter alia, the return of the sum of RM2,340,000.00. The Plaintiffs alleged that the Defendant had wrongly disbursed the sum of RM2,340,000.00 to the 1st TP.

[11] The Defendant denied liability on the following grounds:

(a) The Plaintiffs lacked locus standi;

(b) The Auction Surplus had been released in accordance with PGMJ's instructions vide its letter dated 16 November 2012;

(c) The payment to Omar was made pursuant to PGMJ's instructions and/ or representation as well as the Defendant's belief in said representation as well as the representations by Omar and the Firm;

(d) PGMJ's action is time-barred under the Limitation Act, 1953;

(e) The Defendant is under no obligation to ensure that the Fraudulent Power of Attorney was permitted by PGMJ's Constitution;

(f) The Defendant does not stand in a position of trustee vis-a-vis PGMJ and consequently, the alleged breach of such trust is denied.

[12] The Defendant filed Third Party proceedings against all the Third Parties for an indemnity ['the Defendant's Claim'] in the event the Plaintiffs' Claim against the Defendant is allowed.

[13] The 2nd and 3rd TPs were sued therein in their capacities as the partners of the Firm. The Defendant's Claim for indemnity against the 2nd and 3rd TPs was primarily premised on negligence and breach of professional duties. The Defendant contended that the 2nd and 3rd TPs had wrongfully advised the Defendant to release the sum of RM2,340,000.00 to the 1st TP.

Our Decision

[14] Central to the determination of the dispute in the Court below and the outcome of this appeal too is whether the payment of the Auction Surplus to the donor of the alleged Fraudulent Power of Attorney ['FPA'], the said Omar, was pursuant to valid instructions from PGMJ.

[15] We have made reference to the FPA being the subject-matter of Suit 87 and Suit 46 and the decision of the Court of Appeal ['COA'] which affirmed the High Court ['HC'] decision.

[16] On the importance of the FPA to this appeal, it was highlighted to us by the Appellants that consequently, at the trial of this matter, following the affirmation of the High Court decision by both the Appellate Courts, the LJ held that although the Defendant was not a party to Suit 87 and Suit 46, the Defendant was bound by the findings concerning the FPA because the very same FPA had been used by Omar to get the Defendant to release the Auction Surplus to him as Attorney. Further, that the Defendant was precluded from relying on the FPA as a defence to the release of RM2,340,000.00 to Omar as PGMJ's attorney.

[17] In view of the above, the Respondent did not pursue the FPA as a defence.

[18] As the terms of s 268(1)(3) of the National Land Code ['NLC'] are crucial for our deliberation, we would, for convenience reproduce this subsection as follows:

Section 268(1)(3) NLC

(3) The residue, if any, of the purchase money shall, subject to subsection 339(3), be paid to the chargor.

[19] Essentially, it stipulates the manner in which proceeds of an auction are to be applied. The provisions would appear to be mandatory as reflected in the use of the word "shall".

[20] Our attention was drawn to these leading authorities:

1) Keng Soon Finance Berhad v. MK Retnam Holdings Sdn Bhd & Anor [1989] 1 MLRA 53

2) Gondola Motor Credit Sdn Bhd v. Almurisi Holdings Sdn Bhd [1992] 1 MLRA 162

[21] In United Malayan Banking Corp Bhd v. Chong Bun Sun & Another Case [1994] 1 MLRH 331 it was remarked emphatically that:

"it is the view of this court that in an application for an order for sale under s 256, the court must make an order for sale, and such sale must be by way of a public auction and not otherwise. In Keng Soon Finance Bhd v. MK Retnam Holdings Sdn Bhd & Anor [1989] 1 MLRA 53, Lord Oliver speaking of the powers of the court in an application for sale of the charged property under s 256, observed (at p 56):

Section 256(3) of the National Land Code is mandatory. The court "shall" order a sale unless it is satisfied of the existence of 'cause to the contrary'. Granted that these words have been construed in Malaysia as justifying the withholding of an order where to make one would be contrary to some rule of law or equity, they clearly cannot extend to enabling the court to refuse relief simply because it feels sorry for the borrower or because it regards the lender as arrogant, boorish on unmannerly."

Further that:

"In Gondola Motor Credit Sdn Bhd v. Almurisi Holdings Sdn Bhd [1992] 1 MLRA 162, Harun Hashim SCJ in delivering the judgment of the Supreme Court also observed as follows:

"...under s 256(3), on an application to court for an order for sale by the chargee, it is mandatory on the court to order the sale unless it is satisfied of the existence of cause to the contrary."

[Emphasis Provided]

The NLC spells out in detail the powers of the court. These are statutory powers and the court cannot act beyond these powers. Any purported exercise of this power by granting a remedy not authorized by the NLC would be ultra vires the NLC, resulting in the sale of the charged property being rendered void, and the registration of the title in the purchaser's name not being indefeasible on the ground that the registration was obtained by means of an insufficient or void instrument: see the judgment of Edgar Joseph Jr J (as he then was) in United Malaysan Banking Corp Bhd v. Sykt Perumahan Luas Sdn Bhd (No 2), approved by the Supreme Court in M & J Frozen Food & Anor v. Siland Sdn Bhd & Anor [1993] 1 MLRA 107."

"...The Code itself expressly provides for the manner of sale which the court ought to make under s 257 - a sale by public auction. So strict is this requirement, that s 257(1)(a) does not provide for any other method of sale. In the face of this express provision, it would be a clear usurpation of the legislative function, if an order by way of private treaty is allowed."

[22] The finding of the LJ that was the subject of serious challenge by the Appellants was that with the admission of the Impugned Letter as an exhibit, the Plaintiff had effectively waived its rights under s 268(1)(3) NLC and that the Defendant had been discharged of liability "yang sepatutnya wajib dipatuhi oleh Defendan".

[23] We accept that it is trite law that any person who is entitled to the performance of a statutory duty can effectively waive the performance of the statutory duty by the party or person bound by law to do so save where that language of the statute concerned permits the waiver. It is to be noted that it is trite that parties to a contract can effectively contract out of any statutory obligation or duty imposed by statute.

[See Kimlin Housing Development Sdn Bhd v. Bank Bumiputra Malaysia Bhd & Ors [1997] 1 MLRA 267]

[24] We would proceed to discuss the Impugned Letter which was raised and relied upon by the Respondent in its Defence as a representation by PGMJ to apportion the Auction Surplus on the terms set out in that letter.

[25] It was tendered by DW1 for the purpose of proving the alleged representation by PGMJ. However, the original was not produced by DW1 at the first instance. Importantly, the original was not even shown to DW1. Upon objections being raised by the Plaintiff to its admissibility it was marked as ID-D2 but was thereafter, admitted as an exhibit after submissions at the close of trial and marked as Exhibit D2.

[26] As summarised by the Appellants, the Federal Court in Desa Samudra Sdn Bhd v. Bandar Teknik Sdn Bhd & Ors [2012] 1 MLRA 199 [paragraph [49]], the law governing documentary evidence was set out:

(1) The considerations and the order of said considerations are relevancy, admissibility and weight to be attached to the document in question;

(2) Relevant evidence rendered admissible remains "subject to the element of weight".

(3) When considering whether any weight ought to be or the degree of weight to be attached regard "must be given to the authenticity of the evidence, its source, its contents, and more importantly, the surrounding circumstances of the case. This is where contemporaneous evidence would come in handy."

[27] We were called upon to consider the admissibility of ID2 into evidence on the assertion that the LJ had erred in principle in admitting ID2 as an exhibit despite the requirements for its admission under the Evidence Act not being satisfied.

[28] It was principally the Appellants' contention that the LJ had erred and failed to appreciate the evidence adduced in these respects:

1) On the admissibility of Ex D2 into evidence;

2) Following the admission that no weight ought to have been attached to Ex D2 given the controverted evidence that resulted in the Respondent failing to discharge its burden for the admission of D2; and

3) That the Respondent on a balance of probabilities had failed to discharge its burden of proof to establish its pleaded defence.

[29] With respect to the LJ, we are not in agreement with her view, which we consider to be an error of principle that Ex D2 ought to be admitted as evidence since it had been received by SD1, proven by the Defendant's acknowledgement of receipt. What the LJ did not consider was that the overwhelming evidence was that it was not shown to have been received from PGMJ. As such, PGMJ would not be considered in law to be bound by the representation contained therein.

[30] In adopting that view, the LJ appears to have relied on Sinarlim Sdn Bhd v. Medallion Builders Sdn Bhd [2012] 6 MLRH 426.

[31] We are convinced that the LJ had misapplied the principle in Sinarlim (supra) following her failure to consider and appreciate the factual and evidential differences between that case and the present. Briefly, these are the material differences:

i) In Sinarlim, the documents concerned were tendered and admitted through the witness who had received it from an employee of the defendant, an employee with whom she had dealt with on previous occasions.

ii) On the crucial issue of receipt of Ex D2 in our case, the evidence was wholly unreliable as DW1 who tendered Ex D2 contradicted herself on whether she had received it from the legal firm or PGMJ and whether she had received the original.

iii) While the witness from the legal firm 1st TP, confirmed that he had received the original letter from PGMJ, he could not confirm its whereabouts nor whether the original or a copy had been delivered to the Respondent. What clearly surfaced from the evidence material to the issue at hand was that it was manifestly clear the absence of evidence showing that Ex D2 had been received by the legal firm from PGMJ as was conceded by the said witness. He also conceded that no evidence existed that Ex D2 was sent by PGMJ. Importantly too, SP1 received the letter from the legal firm, not PGMJ. These material factors had not been sufficiently appreciated by the LJ in arriving at her findings.

[32] We have borne in mind the provisions of s 101 of the Evidence Act, 1950 on the 2 types of burden of proof which are directly relevant to the present dispute. In particular, the established rule is that the onus of any particular fact lies on the party who alleges its existence, not on him who denies it.

[See Letchumanan Chettiar Allagappan @ L Allagappan & Anor v. Secure Plantation Sdn Bhd [2017] 3 MLRA 501]

[33] Bearing in mind the said established rule on burden of proof and the undisputed fact that part of the auction proceeds had been paid to Omar which was done purportedly pursuant to the NLC, the burden of proving the Respondent's negligence and that the impugned disbursement was made pursuant to the FPA without adequate verification from the Appellants was on the latter. We agree with the Appellants' position that they had discharged the evidential burden placed on them as the Plaintiffs in the action. It followed that the Defendant/Respondent having pleaded representation by PGMJ by way of the Impugned Letter, bore the burden of proving the representation, that such representation was made by PGMJ and the authenticity as well as the contents of the Impugned Letter.

[34] With respect we are also not in agreement with the LJ's opinion that Ex D2 had in fact been issued by PGMJ. On this vital point, our view is that the reasons in support of her findings are incorrect. The reasons are, briefly, these:

a) As the Plaintiffs were aware of the auction sale of their charged property, it was for them to contact the Defendant regarding their rights in respect of the auction sale and the balance proceeds whereas it was only the 1st TP who communicated with Defendant.

b) Based on the 6th Plaintiff's evidence that the signature in Ex D2 resembled his but he denied signing the letter, it was for the Appellants to call him as a witness to verify the veracity of Ex D2.

c) As the pleaded Defence of the Defendant was premised on the letter Ex D2 it was for the Plaintiffs to prove that Ex D2 was not issued by them on account of the onus of proof having shifted to the Plaintiffs.

d) A claim made under s 268(3) NLC has to be for the entire auction proceeds and not for just a portion of the same ie, the amount paid out to Omar, which was what the Appellants claimed. As such, the apportionment was within their knowledge and was a admission by them that it was of their instructions and with their consent. There was no evidence of their amount that Omar had paid to and received by PGMJ.

[35] In contrast to the LJ's view we are unequivocal in holding that the onus of proof in respect of the validity and truth of the alleged representation made by PGMJ to the Respondent vide Ex D2 had shifted to the Respondent who was the party that relied heavily on this documentary evidence to establish its defence. On the facts and evidence as a whole before the trial Court, it was abundantly clear that the Respondent had failed to satisfy this onus of proof, particularly because the admissibility of the contents of Ex D2 had not been established. By virtue of ss 67 and 101, EA the burden of proof of Ex D2, and its genuineness lies on the Respondent being the party producing it and asserting its validity. This is regardless of the fact that it was the Appellants who had alleged that this document that was crucial to the Defence was forged and was not authorised by PGMJ.

[See Sembagavally Murugason v. Tee Seng Hock [2019] 5 MLRH 512; Letchumanan Chettiar Alagappan (supra)].

[36] Amongst other material facts, we have noted the fact that the 6th Plaintiff ['Haji Jaafar Ahmad'], the alleged signatory of Ex D2, was then the Secretary- General of PGMJ which the Respondent did not dispute. To our minds, the correct position in law, contrary to the Respondent's proposition is that it would not suffice for a party relying on a document to merely prove its existence but also that it was in fact issued by a person in authority from the opposing party, in this instance, Jaafar. As rightly held in RHB Bank Berhad v. Dominance Timber Industries Sdn Bhd & Ors And Another Case [2008] 4 MLRH 191; by reference to s 67, EA:

"Under this section, there is a requirement not only to prove the existence of the document but also to prove the signature and/or handwriting of the person confirmed. Thus, a party who exhibits a document must also prove the document was written or signed by the concerned person....if a document is alleged to be signed or written by any person, then the document must also be proved to be in his handwriting. Thus, producing a document by itself does not dispense with the need to prove the executant."

[37] In this context, of importance is the admission of DW1 herself that the Respondent had failed to prove that Ex D2 had been issued by PGMJ and the signatories were as appearing in the letter. The said Omar was clearly not a person in authority in PGMJ with standing to receive money owed to PGMJ.

[38] We do not propose to set out the material aspects of DW1's evidence except to highlight that on the whole her testimony did not support the Respondent's defence that the Respondent had acted properly and lawfully in releasing the surplus proceeds to Omar premised on the alleged representation by PGMJ vide the impugned letter that was issued pursuant to the FPA. The evidence that the letter was not properly issued by PGMJ in accordance with its constitution could not be contradicted.

[39] It was apparent that the LJ had failed to properly appreciate and consider several vital facts that pointed irresistibly to the Respondent's negligence as pleaded. As the Respondent's case was essentially that it did not recognise PGMJ's present Committee and the Trustees - it only recognised the 1994 Trustees, coupled with DW 1's admission that no steps were taken to verify the FPA and the signatories of Ex D2, its negligence was proven. In our considered view, the LJ had arrived at a conclusion that was plainly wrong as a result of failing to appreciate the facts as a whole and misdirecting herself by failing to correctly apply established principles on burden and onus of proof, particularly in wrongly placing the onus of proof on the Appellants to disprove Ex D2. In fact, to begin with it was not even properly and correctly admitted into evidence.

[40] We are constrained not to adopt the position taken by the Respondent in support of the LJ's decision and findings on the issues in dispute. Briefly, the Respondent's position which we did not find to be tenable as below.

[41] In essence, we are not persuaded by the Respondent's contention that there was no error or misdirection by the LJ when she arrived at the finding that the Appellants had failed to prove their pleaded claim on the premise that it was a correct decision based on the alleged letter of representation by PGMJ [Ex D2] which she accepted to be the truth. The LJ had purportedly taken into consideration the totality of the witnesses' evidence, especially PW1, DW1 and the 1st TP.

[42] We have already addressed the LJ's misplaced reliance on the principle in Sinarlim Sdn Bhd v. Medallion Builders Sdn Bhd (supra) when she failed to distinguish that case on the facts: She had, thus wrongly applied that authority to the present facts that were distinctly different. Also, that the LJ had fallen into error when she failed to correctly apply the law on burden of proof of particular facts when she held that as the Respondent's defence placed reliance on the letter Ex D2, the onus was on the Appellants to prove that it was not issued by PGMJ. The Respondent incorrectly contended that the duty or onus was on the Appellants to call all necessary witnesses on this point as the 6th Plaintiff had admitted that the signature on Ex D2 resembled his. We maintain our view that the misdirection by the LJ in relation to the burden of proof being shifted to the Appellants is serious and calls for rectification by us.

[43] To sum up on the appeal, our judgment is that the LJ had misdirected herself and misapplied the principles pertaining to the application of s 114(g) EA in drawing an adverse inference as the Impugned Letter ['Ex D2'] was relied upon by the Respondent as its defence to PGMJ's claim; it was material only to its version of events. Hence, it followed that the burden therefore lay with the Respondent to prove the same and to discharge this burden in respect of this particular fact. The onus had not shifted to the Appellants, as the LJ had wrongly held to produce the necessary evidence and witnesses on this fact in issue, including calling the 6th Plaintiff who was crucial to the Respondent's defence and not the Appellants' claim. The failure or omission to do so should have been held to be to the Respondent's detriment that would also attract an adverse inference under s 114(g) EA against the Respondent's defence. [See Ho Hup Construction Company Bhd at ABA(3) pp 165-189 paragraphs [51] - [59].

Conclusion (Appeal)

[44] At the conclusion of the hearing, we delivered our unanimous decision with brief reasons on key points as follows:

We find merits in the appeal of the Plaintiffs/Appellants. Under the law the Plaintiffs whose trustees are in Malaysia and the property being in Malaysia, no Power of Attorney can be validly given to confer authority on a third party in this case TP1 Omar to receive part of the balance proceeds of the auction sale of the PGMJ's property.

In fact, the Power of Attorney supposedly given by the Trustees of PGMJ to Omar had been declared to be null and void for being fraudulent.

That being the case, the Bank (Respondent) cannot validly release the sum of RM2.34m to an unauthorised TP. Therefore, the Bank has to be held liable for wrongful release of the monies claimed as well as for being negligent in not properly verifying the valid signatories of PGMJ.

The Learned High Court Judge had been plainly wrong in arriving at her decision that the Bank was not liable at all for the unauthorised release of the balance of the Appellant's monies after the auction of the Appellant's property.

The appeal is allowed and judgment is entered as prayed for only in prayers (a) and (b) of para 21 of the Amended SOC with interest at 5% pa from date of writ to realisation.

The order of the High Court is set aside and we order costs of RM50,000.00 here and below to the Appellants subject to allocator.

Respondent's Cross-Appeal

[45] A preliminary objection ['PO'] was raised by the Appellants on a point of law and procedure as to the validity of the Cross-Appeal ['CA']. It was submitted that the CA should be dismissed in limine on the ground that it was incompetent and wrong in law. We upheld the PO by majority, Lee Swee Seng, JCA dissenting.

[46] In essence, the basis for the PO was that in law Notices of Appeal ['NOAs'] and cross-appeal filed under Rules of Court of Appeal, 1994 ['RCA 1994'] are distinct from each other. A notice of cross-appeal does not provide for an issue not decided in the Respondent's favour unrelated to the main appeal to be re-heard.

[47] What transpired in the Court below was that the Respondent commenced third party ['TP'] proceedings against the said Omar and the 2 partners of the Legal Firm - Zul Azam Md Dahlan and Sabaruddin Ali ['the Partners']. Zul Azam testified as TPW 1.

[48] Thereafter, following this appeal [Encl 3] the Respondent filed a Notice of Cross Appeal ['NCA'] against the 2 partners/TPs 2 & 3), not against the Appellant. The Appellants contended that the NCA was incompetent for these reasons:

i) While encl 3 purports to be made under this Appeal, the parties cited have been unilaterally altered by the Respondent, giving the impression that those named there as TPs have been correctly cited in this Appeal as such - the parties cited in the NOA are strictly the Appellant and the Respondent.

ii) By the CA the Respondent seeks to set aside the finding of no liability of the Partners to the Respondent; this is not the subject matter of the Appeal. That this is the intended objective is clear beyond peradventure as evident from these facts:

a. the Respondent raises matters which are not connected to the substance of the Appellant's appeal - this appeal is purely on the issues as between the Appellant and the Respondent, it does not concern the Partners;

b. As the Partners were cited as TPs by the Respondent, a separate and independent NOA ought to have been filed by the Respondent with regards to the TP proceedings issues;

iii) Consequently, the Respondent ought to have filed a separate NOA against the Partners and not attempt to do so vide the CA.

[49] This proposition was fully supported by the following authorities which are indistinguishable from the present situation:

a. In Re Cavander's Trusts [1881] 16 Ch D 270

b. Kabushiki Kaisha Ngu v. Leisure Farm Corp Sdn Bhd [2016] 6 MLRA 373

c. Dr Chong Eng Leong v. Harris Mohd Salleh [2017] 1 SSLR 607; [2017] 4 MLRA 382

[50] More importantly, the correct position was made amply clear by the Federal Court in Douglas Ding Jangan & Ors v. Kerajaan Negeri Sarawak & Ors [2021] 5 MLRA 259 - "For all intents and purposes, the notices of substantive appeal under r 5 of the RCA disguised as notice of cross-appeal under r 8."

[51] For the foregoing reasons, our majority decision in respect of the above PO was as follows:

We would allow the PO by majority. The PO is supported by the law and 2 Federal Court decisions that we have referred to.

Notwithstanding a Court of Appeal's decision by another panel, as the Appellants were not a parties to that motion, the Appellants are entitled to raise the PO here and are not bound by that decision of the previous Court of Appeal on an important point of law. It is settled principle that a question of law may rightly be raised at the Appellate stage before delivery of judgment.

The grounds of cross-appeal are not related whatsoever to the appeal and so we are inclined to allow the PO and strike out the notice of cross-appeal. Costs of RM5,000.00 to be paid by the Respondent to the Plaintiffs/Appellants.

[52] For record, the Minority Decision by Lee Swee Seng, JCA on the PO is as follows:

I dismiss the PO of the Appellants/Plaintiffs with respect to the Notice of Cross-Appeal being bad in law. There had been a previous decision of the Court of Appeal where the Court of Appeal had directed that the TPs be heard. I understand that the Plaintiff/Appellant was not served with the application and thus was not heard.

Be that as it may, being an order of the Court of Appeal which has not been set aside, this new corum of the Court of Appeal is bound to give all due deference to the directions of the previous Court of Appeal.

As for whether the Respondent's Notice of Cross-Appeal is confined to the scope of the Plaintiffs/Appellants' appeal, that can be decided at the end of the appeal and not at this PO stage when no application was filed to strike out the Respondent's Notice of Cross-Appeal.

I also considered the unenviable position that the Respondent found themselves to be in, in that if they were to file a separate Notice of Appeal, they would have to appeal against a decision in their favour.

The best that the present rules afford is to try as best to come within the ambit and scope of a cross-appeal.

On ground of justice of the case, I would dismiss the PO. Costs of RM5,000/- to be paid by the Appellants/Plaintiffs to the TPs.

Lee Swee Seng JCA (dismissing the PO by minority):

[53] Learned counsel for the Appellants on the day of hearing of the appeal on 1 March 2023, raised a Preliminary Objection ("PO") that the Respondent's Notice of Cross-Appeal is incompetent and as such should be struck out.

[54] The PO was raised by the Appellants on a point of law and procedure as to the validity of the Notice of Cross-Appeal. It was submitted that the Notice of Cross-Appeal should be dismissed in limine on the ground that it was incompetent and wrong in law. The majority upheld the PO and struck out the notice of cross-appeal with costs of RM5,000.00 to be paid by the Respondent to the Appellants/Plaintiffs.

[55] As I was in the minority that dismissed the PO with costs of RM5,000.00 to be paid by the Appellants/Plaintiffs to the Defendant, it behooves me to write this brief grounds of judgment.

Brief Facts

[56] The 1st and 2nd Plaintiffs are the registered Trustees of a society called Persekutuan Guru-Guru Melayu Johor Cawangan Batu Pahat ("the Society") and the 3rd to the 6th Plaintiffs are the office bearers of the Society.

[57] The Respondent, Bank Islam Malaysia Berhad ("the Bank"), the Defendant in the High Court below, found itself in an unenviable situation. The High Court had dismissed the Plaintiffs' claim against the Bank for breach of trust and negligence in releasing the surplus of the proceeds realised from an auction sale of their land of RM2.34 million to the 1st Third Party ("1st TP") Omar Kassim ("Omar"). A previous High Court had held that the Power of Attorney ("PA") given by the Society to Omar was fraudulently procured and null and void. The decision was affirmed in the Court of Appeal and leave to appeal further to the Federal Court had been dismissed.

[58] Consequently, the High Court had also dismissed the Bank's claim against all the Third Parties ("TPs") including the 2nd Third Party ("2nd TP") and 3rd Third Party ("3rd TP") who are partners of a legal firm that had represented the Bank in the public auction pursuant to an order for sale obtained upon default of the Society's loan from the Bank. However, the High Court went on to hold that the Defendant Bank had not relied on any advice of its solicitors when it came to the release of the said RM2.34 million to Omar. A balance sum of RM1,312,025.98 was released by the Bank to the Society.

[59] Upon being sued by the Plaintiffs, the Defendant had commenced Third Party ("TP") proceedings against the said Omar and the 2 partners of the Legal Firm - Zul Azam Md. Dahlan and Sabaruddin Ali ("the Solicitors") for a contribution and indemnity. Zul Azam testified as TPW.1. The Defendant's claim against the 2nd and 3rd TPs is premised on negligence in discharge of their professional duty of care in advising the release of the sum of RM2.34 million to Omar.

[60] Omar did not enter appearance nor appear in the High Court to defend himself. However, as the High Court had dismissed the Plaintiffs' claim against the Defendant Bank, invariably the Defendant's claim against all the TPs had to be dismissed.

[61] The Plaintiffs, being aggrieved by the said decision of the High Court, filed their appeal (Enclosure 1). The Defendant filed a Notice of Cross- Appeal ("Enclosure 3") against the decision of the High Court of 14 October 2021 and prayed that the decision of the High Court be affirmed but that certain findings of fact against it with respect to the TPs be reversed.

[62] The parties shall be referred to as they were as Plaintiffs or Appellants, the Defendant or Respondent and Omar as 1st TP and the Solicitors as 2nd and 3rd TPs.

[63] The Plaintiffs as Appellants contended that the Notice of Cross-Appeal was incompetent as the subject matter of the Cross-Appeal has no connection whatsoever with the Plaintiffs' claim for breach of trust and negligence against the Defendant Bank. The Defendant should have filed a Notice of Appeal against the TPs with respect to findings of facts that it did not agree so as to preserve its right to enter judgment against the TPs or at least to be able to argue why the High Court was wrong to have made those findings of fact not in the Defendant's favour.

Whether The Notice Of Cross-Appeal Filed By The Defendant/Respondent Against The Finding Of Facts Not In Its Favour In The TPs' Proceedings Ought To Be Set Aside As Against The Appellants/Plaintiffs

[64] In Pengerusi Suruhanjaya Pilihanraya Malaysia (Election Commission Of Malaysia) v. See Chee How & Anor [2015] 6 MLRA 353 the Court of Appeal explained that:

[77]...... a cross-appeal is only meant for variation of "the decision" appealed against and not for variation, reversal or setting aside of any other decision of the High Court unrelated to the appeal filed by the appellant.

[Emphasis Added]

[65] The misconception as to the true nature of a Notice of CrossAppeal had been exhaustively expounded in the Federal Court case of Kabushiki Kaisha Ngu v. Leisure Farm Corp Sdn Bhd & Ors [2016] 6 MLRA 373. The plaintiff there had appealed against the High Court's order to grant damages instead of a prayer for specific performance eventhough it had held that the sale and purchase agreement of a golf course land was a valid agreement between the first and 2nd defendant and that the 3rd defendant was not a bona fide purchaser. The plaintiff was aggrieved by the decision of an award of damages and they appealed on ground that they should be entitled to specific performance. The 1st defendant filed a cross-appeal by which it intended to reverse the entire decision of the High Court.

[66] Before the Court of Appeal, the plaintiff/appellant raised a preliminary objection against the 1st defendant's appeal. The plaintiff argued that the effect sought by way of the 1st defendant's cross-appeal was to set aside the finding of the High Court that there was a concluded contract. It was thus the plaintiff's contention that the 1st defendant sought to raise matters which were unconnected with its appeal, which was only against a part of the judgment ie that no specific performance had been ordered. The plaintiff argued that the 1st defendant's appeal should have been filed by way of a Notice of Appeal and not be way of a Notice of Cross-Appeal. The Court of Appeal agreed with the plaintiff and ruled that the cross-appeal should have been restricted to vary that part of the order that was being appealed by the plaintiff and should not be permitted to seek to reverse any other aspects of the decision of the High Court. The 1st defendant obtained leave to appeal to the Federal Court and the Federal Court held as follows:

"[23] We are of the view that under r 8 of the RCA 1994 the 1st defendant cannot set aside the substantive finding of facts made by the High Court by way of notice of cross-appeal. The 1st defendant may only set aside the substantive findings of the High Court by way of filing a notice of appeal under r 5 of the RCA 1994. Only an appeal by way of a notice of appeal constitutes a re-hearing. Rule 8 of the RCA 1994 does not state that a notice of cross-appeal '... shall be by way of re-hearing'. Rule 8 of the RCA 1994 only provides that a respondent could only contend that the decision of the High Court should be varied if the respondent files the notice of cross-appeal within ten days after the service of the record of appeal.

......

[31] The Court of Appeal in the present case had rightly applied the principle enunciated in the English case of Re Cavander's Trusts (1881) 16 Ch D 270 which states that an appeal on a point which does not affect the original appellant cannot be by a cross-appeal. In other words, where the respondent wishes to raise matters which are unconnected with the substance of the appeal by the appellant the respondent must proceed by way of a separate notice of appeal.

.........

[36] It would appear that none of the parties in this case appealed against the entire decision of the High Court. The 1st defendant had failed to appeal against the finding of the High Court that the HK MOU was a binding contract. The High Court's decision that there was a valid and binding agreement concluded between the plaintiff and the 1st defendant is adverse against the 1st defendant. It was thus incumbent on the 1st defendant to file a separate notice of appeal if it wanted the aforesaid decision to be reversed or set aside, rather than by filing a notice of cross-appeal. The operative words of 'to contend' and 'decision of the High Court should be varied' under r 8(1) of the RCA 1994 clearly limits the contentions under a notice of cross-appeal to effectively vary a decision, not set aside a judgment or order. It is incumbent on the 1st defendant to independently file a notice of appeal under r 5 of the RCA 1994 to rehear the issues that were not decided in the 1st defendant's favour. A notice of cross-appeal does not provide for a complaint to be re-heard. The 1st defendant is at liberty to file an independent appeal under s 67(1) of the CJA 1964."

[Emphasis Added]

[67] The Federal Court in Douglas Ding Jangan & Ors v. Kerajaan Negeri Sarawak & Ors [2021] 5 MLRA 259 had reaffirmed the principle set out in at Kabushiki Kaisha Ngu (supra) as follows:

"[33] Juxtaposed with the facts of the present case, the High Court's finding that the appellants have acquired and/or created communal NCR over the cleared areas, which formed the basis for its decision to allow para 25 (i) of the statement of claim, was a finding that was wholly averse to the first to 5th respondents. It was therefore incumbent on the first to 5th respondents to file separate notices of appeal if they wanted the decision to be reversed or set aside. The decision cannot be reversed or set aside by way of cross-appeal under r 8 of the RCA. It can only be done by way of a substantive appeal under r 5.

........

[35] It will immediately be seen that although the notices of cross-appeal sought for a variation of the High Court decision allowing para 25(i) of the statement of claim, the grounds in support of the cross-appeals in fact sought for a completely different order. Far from asking for a variation of the decision, the respondents were actually seeking for an order that the entire decision of the High Court to allow para 25 (i) of the statement of claim be reversed or set aside.

[36] For all intents and purposes, the notices were notices of substantive appeal under r 5 of the RCA disguised as notices of cross-appeal under r 8. This is clear from the contents of the notices and made clearer by the basis on which the cross-appeals were filed - that there is no evidence to support the learned trial judge's finding that the appellants and/or those whom they represent have acquired and/or created NCR over the cleared areas or some patches of the cleared areas shown in exh D80 or D81 or both D80 and D81, contrary to the finding of the High Court.

[37] We do not find it to be correct in law for the respondents to mount such collateral attack on the decision of the High Court without filing notices of appeal of their own under r 5 of the RCA. A cross-appeal under r 8 of the RCA is only for the purpose of varying the decision of the High Court that is appealed against by the appellant and not for the purpose of reversing or setting aside any decision of the High Court which no party to the action appeals against. The cross-appeal must relate to the appeal brought by the appellant and not otherwise and no variation order under r 8 of the RCA can be made in respect of a non-existent appeal.

[38] It is important to keep in mind that there was no appeal filed by the appellants nor by the first to 5th respondents against the decision of the High Court allowing para 25 (i) of the statement of claim. The appellants' appeal was against the decision to dismiss their claim for the balance of the land areas other than the cleared areas. There was therefore nothing to vary in terms of r 8 of the RCA in respect of the decision of the High Court to allow para 25(i) of the statement of claim."

[Emphasis Added]

[68] The cases cited above are not cases dealing with how best a defendant who had obtained a decision in his favour, in that the Court had dismissed the plaintiff's claim against the defendant, may preserve his right to enter judgment against a third party where the plaintiff is appealing. In the event that the plaintiff 's/appellant's appeal is dismissed, the defendant/respondent would have nothing to lose. However, should the appellant succeed, and the Court had dismissed the defendant's claim against the third party purely on ground that the plaintiff's claim against the defendant is dismissed, the Appellate Court would remit the matter back to the Court of first instance for the third party proceedings to be heard on the merits.

[69] The position here is a bit trickier because the High Court below had heard the Plaintiffs, the Defendant and the 2nd and 3rd TPs; the 1st TP Omar did not enter appearance and defend the TP action. The High Court proceeded to find that in any event, the Defendant had not proved its claim against the TPs for a contribution and indemnity. Be that as it may the Defendant's claim against all the TPs was dismissed as the Plaintiffs failed in their claim against the Defendant. How then should the Defendant preserve its right to argue on appeal that it should be allowed to enter judgment against the TPs should the Plaintiffs succeed in their appeal

[70] There was an earlier application filed by the 2nd and 3rd TPs on 20 April 2022 in encl 11 wherein 2nd and 3rd TPs applied to strike out the Notice of Cross-Appeal filed by the Defendant on 22 December 2021. The Application in encl 11 was served on the Appellants' solicitors and the Defendant/ Respondent's solicitors.

[71] The 2nd and 3rd TPs argued that the Notice of Cross-Appeal is not in compliance with rr 5 and 8 of the Rules of Court of Appeal 1994 ("RCA 1994") and s 67 of the Courts of Judicature Act 1964 ("CJA"). It was argued that the Respondent ought to have a Notice of Appeal pursuant to r 5 of the RCA 1994 as the Respondent wishes to appeal against substantive findings of the High Court.

[72] However, the Court of Appeal that heard the application had dismissed the application and directed that all parties be heard. It must be noted that the Appellants did not at any time thereafter filed in their application to strike out the Defendant's Notice of Cross-Appeal.

[73] Section 69 of the CJA gives broad powers and discretion to the Court of Appeal to hear all parties that are already before the Court so as to enable it to do substantive justice with respect to the appeals of the parties before it as set out in s 69(5). For context the whole s 69 is set out below:

"Hearing of appeals

69. (1) Appeals to the Court of Appeal shall be by way of re-hearing, and in relation to such appeals the Court of Appeal shall have all the powers and duties, as to amendment or otherwise, of the High Court, together with full discretionary power to receive further evidence by oral examination in court, by affidavit, or by deposition taken before an examiner or commissioner.

(2) The further evidence may be given without leave on interlocutory applications, or in any case as to matter which have occurred after the date of the decision from which the appeal is brought.

(3) Upon appeals from a judgment, after trial or hearing of any cause or matter upon the merits, the further evidence, save as to matters subsequent as aforesaid, shall be admitted on special grounds only, and not without leave of the Court of Appeal.

(4) The Court of Appeal may draw inferences of fact, and give any judgment, and make any order which ought to have been given or made, and make such further or other orders as the case requires.

(5) The powers aforesaid may be exercised notwithstanding that the notice of appeal relates only to part of the decision, and the powers may also be exercised in favour of all or any of the respondents or parties although the respondents or parties have not appealed from or complained of the decision. "

[Emphasis Added]

[74] The focus of the Rules of Courts are generally to facilitate and not to frustrate proceedings; its thrust and tenor is not to trip or trap the unwary. It is mercifully forgiving where the infraction of the Rules are not such as to cause serious prejudice to the other party raising objection which cannot be compensated by costs. The important thing is that no one should have been misled by the actions taken. Rules of Courts are after all hand-maidens and not a jealous mistress.

[75] No one reading the following Rules in the RCA 1994 can escape its gracious and generous disposition designed as it is for the Courts to do substantive justice to the parties before it and to prevent injustice or abuse of its process by being fixated to or fastidious about it. Rules 102 - 105 are reproduced below:

" Rule 102. Non-compliance with Rules not to render proceedings void.

Non-compliance with any of these rules, or with any rule of practice for the time being in force, shall not render any proceedings void unless the court or a Judge shall so direct, but such proceedings may be set aside either wholly or in part as irregular, or amended, or otherwise dealt with in such manner and upon such terms as the court or Judge shall think fit.

Rule 103. Application to set aside for irregularity when allowed.

No application to set aside any proceedings for irregularity shall be allowed unless made within reasonable time, nor if the party applying has taken any fresh step after knowledge of the irregularity.

Rule 104. Objections of irregularity.

When an application is made to set aside proceedings for irregularity, the several objections intended to be insisted upon shall be stated in the summons or notice of motion.

Rule 105. Inherent powers of the Court.

For the avoidance of doubt, it is 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."

[Emphasis Added]

[76] While the Court of Appeal did not record the grounds for dismissing the application, one can surmise that it must mean that the Court of Appeal did not agree with the reasons given to strike out the Notice of Cross-Appeal as alluded to.

[77] One must appreciate the delicate and unenviable position that the Defendant found itself to be in. Generally, a defendant would not have this problem if the High Court had, after dismissing a plaintiff's claim, gone on to dismiss the defendant's claim against the third parties on ground that as the plaintiff's claim had been dismissed, the defendant's claim against the third parties would stand dismissed as well.

[78] Then when that plaintiff should appeal and succeed in the appeal, the Court of Appeal would then order the matter to be remitted to the High Court for it to hear the defendant's claim against the third party. After all the cause of action of the defendant against the third party does not arise until the judgment is entered by the plaintiff against the defendant.

[79] However, as all the parties including the 2nd and 3rd TPs were before the High Court, the High Court had heard the witnesses, one each from the Plaintiff, Defendant and the 2nd and 3rd TPs as the issues are in a sense quite interconnected with one another. Thus, if it is found that solicitors had given advice to release the auction proceeds of RM2.34m based on a wrong advice that the PA was valid when it was subsequently held to be null and void then the Plaintiffs may well succeed in their claim against the Bank and correspondingly the Bank against the TPs.

[80] Whether and to what extent the Respondent's Notice of Cross-Appeal is confined to the scope of the Plaintiffs'/Appellants' appeal is a matter that can be decided at the end of the appeal and not at this PO stage when no application was filed by the Appellant to strike out the Respondent's Notice of Cross-Appeal.

[81] I agree that the proper way for the Defendant to preserve their right in case the Court of Appeal should decide for the Plaintiffs is to file a Notice of Appeal and not a Notice of Cross-Appeal against the findings of fact made against it vis-a-vis its claim against the TPs. That is the best the Defendant could do because generally one cannot appeal against a decision in its favour.

[82] As in all Rules of Court one must allow substance over form or labels. The substance of the Notice of Cross-Appeal is directed against not the Appellants, but the TPs. The 2nd and 3rd TPs had failed to strike it out and the Court of Appeal had directed all parties to be heard on the appeal. It is not the business of the Appellants to raise the PO because it simply does not concern the Appellants at all. The Appellants had more than ample time to file in their application to strike out the Defendant's Notice of Cross-Appeal but chose not to and only raised it at the hearing of the appeal proper.

[83] Both on account of unexplained and unreasonable delay under r 103 RCA 1994, the late PO should be dismissed. The Appellants knew of the grounds of the 2nd and 3rd TPs in applying to strike out the Defendant's Notice of Cross- Appeal when the application was served on their solicitors on 23 April 2022. It must have taken them many months to mull over it and to raise it on 1 March 2023 after nearly a year at the date of hearing of the Appeal proper.

[84] The Court must look at the substantive justice of the case. The Notice of Cross-Appeal, translated into English reads as follows:

"Take notice, that on the hearing of the above appeal, Bank Islam Malaysia Berhad, the Respondent above-named, will contend that the decisions of the Her Ladyship Justice Halijah Abbas given at the Muar High Court given on 14 October 2021 ought to be varied to the extent and on the grounds hereinafter set out:

(a) That the decision of the Muar High Court that dismissed the Appellant's claim against the Respondent together with the Respondent's claim against all the Third Parties be upheld and affirmed;

(b) That the Learned Muar High Court Judge failed to give due consideration to the merits of the Respondent's claim against all the Third Parties when making its decision to dismiss the Appellant's claim against the Respondent. The Respondent's claim against all the Third Parties is that they be made jointly and/or severally liable to bear the losses suffered by the Respondent as follows:

(i) The 1st Third Party, 2nd Third Party and 3rd Third Party do pay damages for all losses suffered by the Respondent arising out of and relating to the release of the sum of RM2,340,000.00 by the Respondent to the 1st Third Party;

(ii) Alternatively, the 1st Third Party make repayment of the whole of the sum of RM2,340,000.00 to the Respondent for the said sum released to the 1st Third Party;

(iii) Alternatively, the 1st Third Party, 2nd Third Party and 3rd Third Party jointly and/or severally pay the sum of RM2,340,000.00 to the Respondent as damages for the sum released to the 1st Third Party;

(iv) General and Exemplary Damages to be assessed as a result of the negligence and/or false representation by the 1st Third Party, 2nd Third Party and 3rd Third Party that had caused the Respondent to release the sum of RM2,340,000.00 to the 1st Third Party;

(v) Interest at the rate of 5% per annum on the sum of RM2,340,000.00 calculated from date of judgment to full realisation;

(vi) Interest at the rate of 5% per annum on the general damages and exemplary damages calculated from date of judgment until full realisation;

(vii) Cost of this action.

(c) That the Respondent filed this cross-appeal against the appeal filed by the Appellant so as to enable the Court of Appeal to give due consideration to make a decision on the claims of the Respondents against the Third Parties;

(d) That the Appellant's appeal against the decision of the Muar High Court which dismissed the Appellant's claim against the Defendant be heard together with this cross-appeal from the decision of the learned High Court Judge that dismissed the Respondent's claim against the Third Parties in that in the event the Court of Appeal allows the Appellant's claim against the Respondent then the issue of damages in the Respondent's claim against the Third Parties should also be given due consideration and decided on its merits;

(e) Alternatively, in the event that the appeal of the Appellant is allowed, then the cross-appeal of the Respondent also should be allowed to the extent that the Third Parties are liable in full with respect to the reliefs of damages claimed."

[Emphasis Added]

[85] It is abundantly clear that the pith and substance of the appeal is against the findings of fact of the High Court in dismissing the Defendant's claim against the TPs and to preserve the Defendant's right on appeal by the Appellants in the event that the Court of Appeal should allow the Appellants' appeal and allow judgment to be entered for RM2.34 million against the Defendant/ Respondent.

[86] I see nothing wrong with that exercising of the Respondent's defensive appeal which is only applicable should the Appellants succeed in its appeal. Whilst the Respondent can always argue against the Appellants' appeal with respect to the High Court dismissing their claim against the Respondent, without the need to file any Notice of Appeal or Notice of Cross-Appeal vis-a-vis the Appellants, the Defendant would have to file a Notice of Appeal against the TPs in order to argue that judgment should correspondingly be entered by the Respondent against the TPs.

Decision

[87] No one is prejudiced, least of all the Appellants for the Appellants suffer no impediment in arguing their appeal to the hilt. As for the 2nd and 3rd TPs their striking out of the Notice of Cross-Appeal had been dismissed.

[88] It remains then for the Court of Appeal to hear all the parties and so the PO was dismissed with costs of RM5,000.00 to be paid by the Appellants/ Plaintiffs to the Respondent/Defendant.