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DALAM MAHKAMAH RAYUAN MALAYSIA

(BIDANG KUASA RAYUAN)


RAYUAN SIVIL NO: B-02-1076-06/2014
ANTARA
PERAYU

HONG LEONG BANK BERHAD


[NO. SYARIKAT: 97141-X]
DAN
1. MOHD RIDZWAN BIN MOHD SIDEK
NO. K/P: 720426-14-5617 / A2162421]

2. JUNAIDAH BINTI MOHD SIDEK


RESPONDEN-RESPONDEN
[NO. K/P: 551228-10-5820 / 4915719]

[DALAM MAHKAMAH TINGGI MALAYA DI SHAH ALAM


DALAM NEGERI SELANGOR DARUL EHSAN, MALAYSIA
[BAHAGIAN SIVIL]
GUMAN SIVIL NO.: 22-306-2010
ANTARA
1. MOHD RIDZWAN BIN MOHD SIDEK
NO. K/P: 720426-14-5617 / A2162421]
2. JUNAIDAH BINTI MOHD SIDEK
[NO. K/P: 551228-10-5820 / 4915719]

PLAINTIF-PLAINTIF

DAN
DEFENDAN]

HONG LEONG BANGK BERHAD

KORUM:
DAVID WONG DAK WAH, JCA
UMI KALTHUM BINTI ABDUL MAJID, JCA
PRASAD SANDOSHAM ABRAHAM, JCA
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GROUNDS OF JUDGMENT

[1]

We heard this appeal on the 15th of July 2015 and dismissed the

same on the same date. We also dismissed the cross appeal of the 2nd
respondent / 2nd plaintiff and made no order as to costs. We append
below our grounds for so doing.

INTRODUCTION TO THE FACTUAL BASIS LEADING UP TO THE


APPEAL

[2]

The suit was at the instance of the respondents for annulment of a

charge instrument pursuant to a bank facility created in favour of the


appellant on the basis the signature of the 1st respondent was forged.

[3]

The respondents are siblings, the 1st respondent being the

younger brother of the 2nd respondent. The respondents were and are
the co-registered proprietors in equal shares of a property held under
title No.38521, Lot no 17106, Mukim Damansara, District of Petaling,
Selangor (the property).

[4]

The appellant at the commencement of the suit in the High Court

was originally EON Bank Berhad (Eon Bank). By a vesting order dated
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17th June 2011 entered in the Kuala Lumpur High Court Originating
Summons No: 24NCC-175-2011, all the assets, rights and liabilities of
Eon Bank Berhad were vested upon the appellant.

[5]

For the purpose of this judgment, we refer to the parties as they

were referred to in the High Court.

BACKGROUND FACTUAL MATTRIX COMMON TO BOTH PARTIES

[6]

There appears to be a dispute of facts in almost all aspects of the

suit.

[7]

It is common ground nevertheless the 2nd plaintiff in 2003, obtained

a bank loan from the defendant. The loan was to be secured by a


charge on the said property (charge).

The loan documentation was

handled by Messrs Suhaili & Song, a firm of Advocates & Solicitors.


After having drawn down on the loan, the 2nd plaintiff defaulted in
repaying the said loan. The defendant then commenced legal action
against the 2nd plaintiff and judgment was obtained against the 2nd
plaintiff on 24th December 2004.

[8]

The 2nd plaintiff was subsequently adjudicated a bankrupt on 13th

August 2008. Furthermore the defendant commenced foreclosure


proceedings against the plaintiffs in the Shah Alam High Court vide Suit
No. 24-929-2007 and obtained an order for sale of the property on 3rd
October 2007.

THE PLEADED FACTS AS PER THE PLAINTIFFS STATEMENT OF


CLAIM

[9]

On the facts pleaded, the taking of the loan from the defendant

was precipitated by the 2nd plaintiff getting involved with loan sharks to
assist a friend Chong Yoke Cheong (Chong), (see para 7 statement of
claim pg. 31 Rekod Rayuan, Bahagian A).

[10] The 1st plaintiff being a co-proprietor of the said property,


maintains that he did not sign any loan application nor signed any
charge instrument.

[11] The signatures on the loan documents and the charge documents
was for the loan application by the 2nd plaintiff (see para 8 pg. 37
statement of claim).

THE PLEADED FACTS OF THE DEFENDANT AS PER STATEMENT


OF DEFENCE
[12] The defendant contends that it was the plaintiffs on 21st March
2003 who attended the defendants branch at Subang Jaya and applied
for facilities for the 2nd plaintiff.

[13] Particulars of the various facilities are set out in the statement of
defence (pg. 76-77, Rekod Rayuan, Bahagian A).

[14] The 2nd plaintiff liaised with the defendant and the appointed
solicitor to attend to the creation of the charge in favour of the defendant.

[15] The charge was duly registered on 1st July 2005.

[16] The defendant contends all was done bona fide and there was no
element of conspiracy and / or fraud as alleged by the 1st plaintiff.

[17] The issue of the 1st plaintiffs claim not having signed the charge
document and / or the loan document has been put into issue by the
defendant.

OUR FINDINGS
[18] The pivot of this appeal would be to convince us that the learned
Judicial Commissioner misdirected himself when finding that PW1 had
not signed the charge documents in this case and the loan document.
Having found so, the charge became defeasible under section 340 2(b)
of the National Land Code which we now set out:

340. Registration to confer indefeasible title or interest, except in


certain circumstances.
(2)

The title or interest of any such person or body shall not be


indefeasible
(b)

where registration was obtained by forgery, or by means of


an insufficient or void instrument

[19] The learned Judicial Commissioner found so and declared the


charge null and void. The learned Judicial Commissioners findings on
the point are found in Rekod Rayuan Bahagian A, pgs. 143 146 of his
grounds.

[20] The learned Judicial Commissioner found as a fact that the


differing signature of PW1 in the charge document, and other
contemporaneous documents, and considered the circumstances as a
whole before holding on a balance of probabilities that the signature of
PW1 on the charge document was forged. We say the learned Judicial
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Commissioner adopted the correct approach in law (see para 53, 56 &
58 of the Grounds of Judgment at page 145-146 of the Rekod Rayuan
Jilid 1).

[21] The learned Judicial Commissioner also made the following


findings.

(i)

The learned Judicial Commissioner believed unequivocally


the testimony of PW1 being truthful and that PW1 had not
signed the charge document of the defendant.

(ii)

The evidence of PW3 and the role of one Kamarul using the
forged identity card of PW1 (P3) to identify himself as PW1
to deceive the solicitors when signing the charge documents
at their office.

(iii)

The learned Judicial Commissioners comparison of the


thumb print of PW1 imprinted in court compared with PW3
(the forged IC) shows a difference in the signature.

(iv)

The solicitors DW4 and DW5 were not certain whether they
had met PW1 at their office at time of attestation of the
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charge document, as opposed to the 2nd plaintiff who was


orchestrating the whole transaction.

(v)

The learned Judicial Commissioner in our view correctly


invoked section 73 of the Evidence Act 1950 in relation to
the alleged signature of PW1 and we do not agree that the
presence of hand writing experts was essential. (See AGS
Harta Sdn Bhd v. Liew Yok Yin [2010] 7 CLJ pg. 142 NB
where it was held in (3):

(3)

The trial judge found on the balance of probabilities that the


appellant failed to discharge the burden that it was a bona fide
purchaser for value. He clearly assessed the evidence of the
appellant's witnesses and gave reasons for his finding. There
was no fault or error in the reasons given by him.

[22] We find the learned Judicial Commissioner had critically analysed


the

evidence

that

contemporaneous

was

before

documents

and

him

together

considering

with

the

all

the

circumstances, came to a finding of fact that the charge document


in favour of the defendant was not signed by the 1st plaintiff.

[23] We have painstakingly sieved through the evidence and we are


unable to find any juridical reasons to interfere with the findings of
fact of the learned Judicial Commissioner.

[24] We also find that the correct evidential burden was applied by the
learned Judicial Commissioner in his appreciation of the evidence
tendered by the 1st plaintiff.

We refer to the decision of the

Supreme Court in United Asian Bank v Tai Soon Heng


Construction Sdn Bhd reported in [1993] 1 MLJ pg 182 where it
was held :

(1)

A customer who alleges that his banker has honoured forged


cheques drawn on his account need only establish the charge of
forgery on a balance of probabilities.

We also quote the judgment of Anuar JJ (as he then was) at pg


188 para B-GIn the first place, the disputed cheques were referred to Mr Phan
pursuant to two orders of court dated 23 July 1987 and 28 October
1987 (produced in the court below as exhs P29 and P30) which
required him to examine the cheques and say whether the signatures
upon them were genuine or not. This he did. Secondly, having
examined the record of appeal, we are satisfied that the respondent
had in Mr Phan's evidence-in-chief adduced sufficient evidence to
support his conclusions. That being the case, it was up to the appellant
to challenge the evidence of Mr Phan under cross-examination by
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attacking the reasons for his conclusions. From the record it is


apparent that Mr Phan was subjected to searching and strenuous
cross-examination. The learned judge nevertheless accepted his
evidence and we are unable to find any misdirection by the learned
judge on this point.
Another important matter has been raised by the appellant in
connection with the issue of forgery. It was argued for the appellant
both in the court below and before us that the standard of proof
required in cases such as this should be beyond a reasonable doubt
and Syarikat Perkapalan Timor v United Malayan Banking Corp Bhd 2
was cited in support. We have examined this decision with some care
but we are unable to agree with the appellant's counsel that it is
authority for the proposition that is put forward for the appellant. In our
judgment, a customer who alleges that his banker honoured forged
cheques drawn on his account need only establish the charge of
forgery on a balance of probabilities and in this respect, we agree with
the statement of the law by Gunn Chit Tuan J (as he then was) in
Syarikat Islamiyah v Bank Bumiputra Malaysia Bhd where at p 220 the
learned judge said:
In this case although it would appear that there was no or
insufficient evidence to prove beyond reasonable doubt for
purposes of criminal proceedings that the signatures on the
cheques concerned were forged by the said Awang alias
Che Mah bin Che Lob, yet I was satisfied that there was
evidence adduced to prove on a balance of probabilities in
this case that the signatures on the cheques were not those
of the plaintiff's but were forged or placed thereon without
the

plaintiff's

authority

and

were

therefore

wholly

inoperative.

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[25] It is for the aforesaid reasons, as the 1st plaintiff being a coproprietor of the said Land had not signed the charge documents
creating a charge over the whole of the said land, the learned Judicial
Commissioner was correct in his findings and we would dismiss the
appeal accordingly.

[26] In the light of those findings we do not see the need to address the
issues raised in the cross appeal. As to allegations of fraud, conspiracy
and negligence, the learned Judicial Commissioner had painstakingly
gone through the evidence and dismissed the plaintiffs claim and we
find the learned Judicial Commissioner had committed no appealable
error in that regard.

[27] We therefore dismissed the appeal and the cross appeal with no
order as to costs.

Dated: 17th March 2016

Signed
[DATUK DR. PRASAD SANDOSHAM ABRAHAM]
Judge
Court of Appeal Malaysia
Putrajaya
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Counsel for Appellant

Datin Jeyanthini Kannaperan


[with Ms. Izahairani Izahani]
Messrs Shearn Delamore & Co
Tingkat 7, Wisma Hamzah Kwong Hing
50100 Kuala Lumpur
[Ruj: SD (DR) 3290749 (JK/IZI]

Counsel for Respondent


Mr. Joseph Iruthayam
[with Ms. Syafiqah Zuhairah]
Messrs Joseph Iruthayam & Co
3A-3A (4th Floor) No. 30 Jalan Thambylillai Brickfields
50470 Kuala Lumpur
(Ruj: JI/L-719/RS2010]

Cases Referred To:

1. AGS Harta Sdn Bhd v. Liew Yok Yin [2010] 7 CLJ pg. 142 NB
(referred)
2. United Asian Bank v Tai Soon Heng Construction Sdn Bhd [1993] 1
MLJ pg 182 (referred)

Legislation Referred To:


1. The National Land Code section 340 2(b)
2. The Evidence Act 1950, section 73

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