Possession: Control, Custody and Knowledge – ROSLAN ABDULLAH V. PP COURT OF APPEAL, PUTRAJAYA

ROSLAN ABDULLAH V. PPCOURT OF APPEAL, PUTRAJAYA[CRIMINAL APPEAL NO: C-05-144-2006]TENGKU BAHARUDIN SHAH JCA, HASAN LAH JCA, JEFFREY TAN JCA1 SEPTEMBER 2009Case History :

High Court : [2007] 7 CLJ 249

JUDGMENT

Jeffrey Tan JCA:

[1] The charge against the appellant was that he, on 19 May 2001 at 1.20am at house No. Lot 2132, Jambu Rias, 28600 Karak, in the District of Bentong, in the State of Pahang, committed the act of trafficking in a dangerous drug, namely 416 grams of cannabis, an offence punishable under s. 39B(2) of the Dangerous Drugs Act 1952 with death.

[2] At the close of the prosecution case, the learned trial judge held that a prima facie case had been made out. The accused was ordered to enter upon his defence. At the end of the entire case, the learned trial judge held that there was no doubt as to guilt. Against that decision, the accused appealed.

[3] To be more precise, the learned trial judge found that a prima facie case had been made out without any evaluation of the prosecution evidence. Unbelievable but true, at the close of the prosecution case, the learned trial judge merely condensed the prosecution evidence into a single paragraph (for the full text of the judgment of the learned trial judge, see PP lwn. Roslan Abdullah [2007] 7 CLJ 249 HC) and then held, without so much as a word on the veracity and accuracy of the prosecution evidence, that a prima facie case had been made out.

Dari keterangan saksi-saksi ini kesemuanya, fakta terhadap kes ini dapatlah digambarkan seperti mana yang telah disampaikan oleh pihak timbalan pendakwa raya semasa beliau menyampaikan ucapan pembukaan kes. Pada 19 Mei 2001 jam lebih kurang 12.20 pagi, OKT telah ditangkap oleh pihak polis berkaitan dengan kesalahan dadah. Pada jam 1.20 pagi hari yang sama, OKT setelah disoal siasat, telah memberikan suatu maklumat kepada C/Insp Jong Lak Kho. Berikutan dengan maklumat itu, C/Insp Jong dan beberapa anggota lain bersama OKT telah pergi ke alamat Lot 2132 Jambu Rias, Karak. Di alamat itu, C/Insp Jong dan juga OKT telah memasuki ke suatu premis yang kemudiannya dibuktikan sebagai rumah OKT. Di dalam sebuah bilik tidur rumah itu, telah dijumpai sebuah beg jenama ‘Panther’. Di dalam beg itu dijumpai dua bungkusan plastik jernih yang berisi bahan yang disyaki dadah. Juga dijumpai satu kertas plastik jernih, sebilah gunting, sebilah pisau lipat dan satu kad pergigian atas nama OKT di dalam beg itu. Bahan yang disyaki ganja itu telah diserahkan oleh C/Insp Jong kepada pegawai penyiasat kes, C/Insp Kang Liong Soo. Bahan itu telah dihantar untuk dianalisa oleh ahli kimia yang mana kemudiannya disahkan sebagai cannabis seberat 406.60g.

Di akhir kes pendakwaan … suatu kes yang prima facie telah berjaya dibuktikan oleh pihak Pendakwaan. Selaras dengan peruntukan s. 180(3) Kanun Acara Jenayah, tertuduh telah dipanggil untuk membela diri.

[4] Apparently, the learned trial judge had suspended the question of the veracity and accuracy of recollection of witnesses until after the close of the case for the defence. Only at the end of the entire case, did the learned trial judge evaluate the entire evidence, by putting side by side the evidence of the prosecution and defence and by asking the following question.

Persoalannya sekarang, siapakah yang sebenarnya telah bercakap benar di dalam keterangannya. Adakah SP2, SP4, SP7 dan tidak SD1 bercakap benar. Adakah SP2, SP4, dan SP7 juga dan tidak SD2 dan SD3 bercakap benar. Ini sebenarnya adalah menjadi tanggungjawab mahkamah untuk menilai akan setiap keterangan yang dikemukakan sebelum mencapai suatu keputusan yang jitu. Terhadap tugasan mahkamah ini, elok diteliti akan apakah prinsip yang telah diputuskan di dalam kes Pavone v. Public Prosecutor [1983] CLJ 855 (Rep); [1983] 2 CLJ 225; [1984] 1 MLJ 77:

Care must be taken to leave suspended the question of the veracity and accuracy of recollection of witnesses until after the close of the case for the defence.

[5] In Pavone, Edgar Joseph Jr J (as he then was) suspended the question of the veracity and accuracy of witnesses in the face of the judgment of Lord Diplock delivering the advice of the judicial committee of the Privy Council in the Singapore case of Haw Tua Tau v. PP & Other Cases [1981] CLJ (Rep) 11; [1981] CLJ 123 PC.

[6] The advice of the Privy Council in Haw Tua Tau, subsequently approved and applied in the Federal Court decisions of Rangunathan v. PP [1982] CLJ (Rep) 63; [1982] CLJ 25 FC, Dato Mokhtar bin Hashim & Anor v. PP [1983] CLJ (Rep) 101; [1983] 2 CLJ 10 FC, Lee Pin Seng v. PP [1985] CLJ (Rep) 185; [1985] 2 CLJ 454 FC, Kevin John Barlow v. PP & Another Case [1987] CLJ (Rep) 139; [1987] 2 CLJ 286 SC, Munusamy Vengadasalam v. PP [1987] 1 CLJ 250; [1987] CLJ (Rep) 221 SC, and Junaidi v. PP [1993] 4 CLJ 201 SC, was that the trial judge shall call upon the accused to enter upon his defence if there were some evidence (not inherently incredible) establishing each essential ingredient of the alleged offence,

At the conclusion of the prosecution’s case what has to be decided remains a question of law only. As decider of law, the judge must consider whether there is some evidence (not inherently incredible) which, if he were to accept it as accurate, would establish each essential element in the alleged offence. If such evidence as respects any of those essential elements is lacking, then, and then only, is he justified in finding “that no case against the accused has been made out which if unrebutted would warrant his conviction”, within the meaning of section 188(1). Where he has not so found, he must call upon the accused to enter upon his defence, and as decider of fact must keep an open mind as to the accuracy of any of the prosecution’s witnesses until the defence has tendered such evidence, if any, by the accused or other witnesses as it may want to call and counsel on both sides have addressed to the judge such arguments and comments on the evidence as they may wish to advance.

[7] That was how it was up and until the end of 1993. Only a minimal evaluation of the prosecution evidence was called for at the end of the prosecution case. If there were some evidence (not inherently incredible) to support each essential ingredient of the alleged offence, the trial court shall call the accused to enter upon his defence.

[8] But that all changed dramatically at the end of 1993, with the advent of Khoo Hi Chiang v. PP & Another Case [1994] 2 CLJ 151 SC, where the Federal Court not only declined to follow Haw Tua Tau but held that the trial court must subject the prosecution evidence to a maximum evaluation at the end of the prosecution case,

Consequently, the duty of the court, at the close of the case for the prosecution, is to undertake, not a minimal evaluation of the evidence tendered by the prosecution in order to determining whether or not the prosecution evidence is inherently incredible – the Haw Tua Tau test – but a maximum evaluation of such evidence, to determine whether or not the prosecution has established the charge against the accused beyond all reasonable doubt.

With considerable regret, therefore, we must decline to follow Haw Tua Tau and its progeny Ragunathan, Munusamy and Junaidi, as to the effect of the relevant statutory provisions of the Code to which we have referred and discussed.

[9] In Tan Boon Kean v. PP [1995] 4 CLJ 456 FC, another panel of the Federal Court would hold that the ‘case’ required to be established by the prosecution under s. 180 of the Criminal Procedure Code was a ‘prima facie‘ case and not a ‘beyond reasonable doubt’ case.

We are, therefore, of the opinion that the court below is only bound by the ratio of Khoo Hi Chiang that at the close of the case for the prosecution, the duty of the court is to carry out a maximum evaluation of the evidence which, according to PP v. Chin Yoke [1939] 1 LNS 66; [1940] MLJ 47 and followed in Munusamy v. PP [1987] CLJ 221 (Rep); [1987] 1 CLJ 250; [1987] 1 MLJ 492 at pp 497-498, necessarily means that the court must consider the whole evidence of the prosecution as tested in the cross-examination, on the essential ingredients of the charge.

[10] Nevertheless in Tan Boon Kean, the Federal Court was in total agreement that the duty of the court was to carry out a maximum evaluation of the evidence at the close of the prosecution case.

[11] That issue, whether it was the duty of the prosecution to establish a prima facie case or a beyond reasonable doubt case was settled by a seven-judge panel of the Federal Court (Anuar CJ and Mohd Azmi FCJ dissenting) in Arulpragasan Sandaraju v. PP [1996] 4 CLJ 597 FC, who held that the court before calling the accused to enter upon his defence must be satisfied that the prosecution had made out a case against the accused beyond all reasonable doubt, which therefore would call for a maximum evaluation of the evidence tendered by the prosecution.

[12] That should have settled the issue at long last. But that was not to be. On 31 January 1997, s. 180 of the Criminal Procedure Code, was amended to the following, to require the prosecution to only make out a prima facie case at the end of its case.

180. Procedure after conclusion of case for prosecution

(1) When the case for the prosecution is concluded, the Court shall consider whether the prosecution has made out a prima facie case against the accused.

(2) If the Court finds that the prosecution has not made out a prima facie case against the accused, the Court shall record an order of acquittal.

(3) If the Court finds that a prima facie case has been made out against the accused on the offence charged the Court shall call upon the accused to enter on his defence.

[13] It would take a further statutory amendment (Criminal Procedure Act 2006, in force since 6th March 2007) to statutorily define “a prima facie case” as ‘where the prosecution has adduced credible evidence proving each ingredient of the offence which if unrebutted or unexplained would warrant a conviction.”

[14] In PP v. Hanif Basree bin Abdul Rahman [2008] 4 CLJ 1, Zaki Azmi PCA, he then was, imparted the following commentary on the development of the law, from Haw Tua Tau to the present position:

Prior to this amendment, as a result of the decision in Haw Tua Tau v. Public Prosecutor [1981] CLJ 11 (Rep); [1981] CLJ 123; [1981] 2 MLJ 49, there had been heated discussions on the term prima facie in relation to burden of proof at the close of the prosecution case. After the amendment, the discussions on this subject continued culminating in Balachandran v. Public Prosecutor [2005] 1 CLJ 85; [2005] 2 MLJ 301 and Public Prosecutor v. Mohd Radzi Abu Bakar [2006] 1 CLJ 457; [2005] 6 MLJ 393, both Federal Court judgments. Since then, Parliament has introduced the definition of prima facie. That term is now defined as ‘where the prosecution has adduced credible evidence proving each ingredient of the offence which if unrebutted or unexplained would warrant a conviction.

[15] That uncertainty, if any, until settled by the Criminal Procedure Act 2006, was only in relation to the “prima facie case”. In relation to the evaluation of the prosecution evidence, it has long been settled that the evaluation could not be suspended until after the close of the entire case. That has been the law since Khoo Hi Chiang, where it was held that “the duty of the court, at the close of the case for the prosecution, is to undertake, not a minimal evaluation of the evidence tendered by the prosecution in order to determining whether or not the prosecution evidence is inherently incredible – the Haw Tua Tau test – but a maximum evaluation of such evidence, to determine whether or not the prosecution has established the charge against the accused beyond all reasonable doubt”. In Tan Boon Kean, it was held “that at the close of the case for the prosecution, the duty of the court is to carry out a maximum evaluation of the evidence … “. And in Arulpragasan a/l Sandaraju, it was held that the court before calling the accused to enter upon his defence must be satisfied that the prosecution had made out a case against the accused beyond all reasonable doubt, which would therefore call for a maximum evaluation of the evidence tendered by the prosecution.

[16] Yet, the duty of a trial court at the end of the prosecution case remained the same, despite the 1997 amendment to s. 180 of the CPC. In Looi Kow Chai & Anor v. PP [2003] 1 CLJ 734 CA, Gopal Sri Ram JCA (as he then was) held that the one exercise that a judge sitting alone under s. 180 of the CPC has to undertake at the close of the prosecution case is to subject the prosecution evidence to maximum evaluation. In Balachandran v. PP, Augustine Paul JCA (as he then was) held that the duty of a trial court at the close of the case for the prosecution is to “undertake a positive evaluation of the credibility and reliability of all the evidence adduced so as to determine whether the elements of the offence have been established”. Later, in PP v. Mohd Radzi bin Abu Bakar (cited to but was not paid heed to by the learned trial judge), the Federal Court reverted to the phrase ‘maximum evaluation of the prosecution evidence’ to describe the test to be applied, and then provided the following guide to trial courts.

For the guidance of the courts below, we summarise as follows the steps that should be taken by a trial court at the close of the prosecution’s case:

(i) at the close of the prosecution’s case, subject the evidence led by the prosecution in its totality to a maximum evaluation. Carefully scrutinise the credibility of each of the prosecution’s witnesses. Take into account all reasonable inferences that may be drawn from that evidence. If the evidence admits of two or more inferences, then draw the inference that is most favourable to the accused;

(ii) ask yourself the question: If I now call upon the accused to make his defence and he elects to remain silent am I prepared to convict him on the evidence now before me? If the answer to that question is ‘Yes’, then a prima facie case has been made out and the defence should be called. If the answer is ‘No’ then, a prima facie case has not been made out and the accused should be acquitted;

(iii) after defence is called, the accused elects to remain silent, then convict;

(iv) after defence is called, the accused elects to give evidence, then go through the steps set out in Mat v. Public Prosecutor [1963] 1 LNS 82; [1963] MLJ 263.

[17] Since Khoo Hi Chiang, it has been the law that a trial court must evaluate the prosecution evidence at the end of the prosecution case. There could be no question about it; the suspension of the question of the veracity and accuracy of recollection of witnesses until after the close of the case for the defence in the instant case was a serious, serious misdirection of the first order, for with suspension of the question of the veracity and accuracy of recollection of witnesses until after the close of the case, there could not consequently have been the prima facie case as enunciated in Balachandran when the appellant was called to enter upon his defence.

[18] Not just that, we also found that the eventual evaluation of the total evidence was totally flawed. For a start, there was no independent evaluation of the prosecution evidence. In fact, there was no evaluation of the prosecution evidence to speak of. If there were any, then it was purely incidental. The analysis of the evidence by the learned trial judge, now reproduced below in extenso to show out the manner in which it was done, commenced at p. 31 and ended at p. 37 of the judgment.

Meneliti kepada asas pembelaan dari OKT, ia lebih menjurus kepada penafian semata. Beliau menafikan banyak perkara di dalam keterangannya. Beliau menafikan ada memberikan maklumat tentang dadah yang disimpan di rumahnya dalam beg ekshibit P12. Beliau nafikan ada menunjukkan dan mengeluarkan beg tersebut kepada pihak polis, beliau menafikan mengetahui akan isi kandungan yang terdapat di dalam beg tersebut. Beliau menafikan ada menyimpan dadah di dalam beg tersebut serta beliau menafikan ada menyimpan kad gigi di dalam beg tersebut. Terhadap ekshibit P22, beliau menafikan ada memberikan maklumat kepada C/Insp Jong, menafikan ada menandatangani di dokumen ekshibit P22 itu pada hari kejadian serta menafikan akan isi kandungan ekshibit P22 itu.

Meneliti kepada keterangan yang telah disampaikan oleh OKT dan dua orang saksinya yang lain itu, adalah sesuatu yang agak sukar untuk Mahkamah mempercayainya dari segi kemunasabahannya. Di sinilah dikatakan ‘demeanour’ saksi-saksi memainkan peranan. Kebolehpercayaan keterangan saksi-saksi pembelaan ini melalui keterangan masing-masing amat meragukan. Dari segi kemunasabahannya pula, jelas, adalah terlalu jauh untuk menghubungkan kebenaran keterangan yang telah disampaikan itu apabila dibandingkan dengan keterangan-keterangan yang telah disampaikan oleh saksi-saksi pendakwaan yang lain, khususnya keterangan dari SP2, SP4 dan SP7. Kemunasabahan keterangan oleh ketiga-tiga saksi pendakwa ini serta lain-lain keterangan saksi selebihnya itu tidak tercabar oleh keterangan dari saksi-saksi pembelaan ini. Seperti yang diputuskan di dalam kes Public Prosecutor v. Karim Othman [1994] 2 CLJ 826, penggantungan kepada bentuk pembelaan yang berupa ‘bare denial’ semata, tidak mencukupi untuk mengakas di atas prinsip imbangan kebarangkalian akan andaian/anggapan memiliki dan dalam kawalan dadah berbahaya serta pengedarannya.

Di pihak pendakwaan, penggantungan yang dilakukan berdasarkan kepada s. 27 Akta Keterangan 1950 adalah merupakan sesuatu yang tepat. Adalah berpandukan kepada maklumat yang diberikan oleh OKT yang mana seterusnya telah membawa pasukan polis ke rumahnya dengan menunjukkan arah ke rumahnya serta menunjukkan akan bilik tidurnya, telah membawa kepada penjumpaan dadah tersebut seperti yang tersimpan di dalam ekshibit P12. Seperti keterangan oleh isteri OKT sendiri bahawa beg P12 itu digunakan oleh OKT untuk dibawa bekerja. Maknanya beg tersebut adalah milik sebenar OKT serta tersimpan di dalam bilik tidurnya sendiri. Walaupun keterangan cuba diberikan yang bilik tidurnya boleh dimasuki oleh kawan-kawannya serta saudara maranya, namun keterangan beliau ini tidak kukuh tanpa keterangan sokongan yang lain bagi mengiakan sedemikian. Malah, adalah sesuatu yang agak janggal di dalam kehidupan orang-orang timur bagi amalan begitu dijadikan suatu kelaziman. Bilik tidur adalah suatu tempat diibarat ‘kehormatan’ yang perlu dijaga bagi sesuatu keluarga. Sukar untuk diterima hakikat bahawa ia adalah sesuatu yang biasa untuk sesiapa sahaja keluar masuk ke bilik tidur, apatah lagi dalam kehidupan di kampung. Dari segi jarak masa beliau tinggalkan rumah pula, menurut keterangannya, kali akhir beliau meninggalkan rumah untuk pergi ke Kuala Lumpur adalah pada pagi 18 Mei 2001; iaitu cuma satu hari sebelum tarikh kejadian; tersebut. Jadi, di dalam tempoh satu hari itu, sukar untuk diandaikan akan elemen-elemen yang ‘alien’ terjadi di rumahnya itu, khususnya di bilik tidurnya itu. Juga, tiada keterangan untuk menunjukkan ujud sedemikian. Peguam menghujahkan akan OKT tiada pengetahuan langsung akan isi kandungan yang terdapat di dalam beg ekshibit P12, lantas menafikan akan kewujudan dadah tersebut. Di dalam soal ini, apakah yang dikatakan dengan ‘possession’ itu. Taylor J di dalam kes Leow Nghee Lim v. Reg [1955] 1 LNS 53; [1956] MLJ 28 menyatakan (ms 30):

A man must know of the existence of a chattel and have some idea of its whereabouts before he can exercise any control over it. The word possession therefore implies full or exact knowledge.

Jelaslah tanpa pengetahuan, tidak akan ujud pemilikan. Di dalam kes ini, dari keterangan-keterangan yang diperturunkan di atas tadi, jelaslah elemen pengetahuan oleh OKT terhadap kewujudan dadah di dalam beg ekshibit P12 yang terdapat di dalam bilik tidurnya di rumah di Jambu Rias itu tidak dapat diketepikan akan kewujudannya. Maklumat yang diberikan dan terkandung di dalam ekshibit P22 yang membawa kepada penemuan fakta dadah itu adalah berselari dengan hakikat ini.

Berbalik kepada s. 27 yang dibangkitkan itu. Mahkamah Agong di dalam kes Wai Chan Leong v. Public Prosecutor [1989] 1 CLJ 171 (Rep); [1989] 2 CLJ 1168; [1989] 3 MLJ 356 dengan memetik keputusan Hakim Suffian di dalam kes Chong Soon Koy v. Public Prosecutor [1977] 1 LNS 20, menyatakan: ‘it is fallacious to treat ‘fact discovered’ within s. 27 as equivalent to the object produced; the fact discovered embraces the place from which the object is produced and the knowledge of the accused as to this and the information given must relate distinctly to this fact.

Mahkamah di dalam kes Wai Chan Leong v. Public Prosecutor juga menyatakan: ‘It must also be observed that the legislature had used the expression “information’ in s. 27 of the Evidence Act 1950 and therefore did not intend it to have the same meaning as a statement …’. Seperti yang dihujahkan oleh timbalan pendakwa raya bahawa s. 27 adalah tidak sama pemakaiannya jika dibandingkan dengan s. 37 Akta yang sama.

Definasi ‘fact’ di bawah s. 37 Akta dinyatakan sedemikian:

‘fact’ means and includes -

(a) anything, state of things or relations of things capable of being perceived by the senses,

(b) any mental condition of which any person is conscious.

Lantas hujahan oleh timbalan pendakwa raya akan skop pemakaian s. 27 khususnya di dalam kes ini adalah menepati definisi seperti yang dihuraikan tadi. Yang penting ialah maklumat yang diberikan dan bukannya pengakuan. Maklumat itu menjurus kepada penemuan kepada fakta seperti yang terjadi di dalam kes ini.

Di akhirnya, setelah saya meneliti akan keterangan-keterangan yang telah diberikan di hadapan mahkamah ini, saya memutuskan yang OKT Roslan @ Rosli bin Abdullah adalah bersalah dan disabitkan di atas pertuduhan sepertimana yang dibacakan di awal tadi.

[19] In the above 1st paragraph beginning with the word “Meneliti”, it was held that the defence was a denial. In the above 2nd paragraph also beginning with the word “Meneliti”, it was held that the testimony of the appellant and his witnesses could not be believed, that the demeanour of the appellant and his witnesses was akin to that of actors in court, and that the testimony of the appellant and his witnesses were too far off the truth as when compared to the testimony of the prosecution witnesses (in particular SP2, SP4 and SP7) which was not challenged by the testimony of the appellant and his witnesses. It was further held that the denial of the appellant was not sufficient to rebut the presumption of possession and trafficking. In relation to that latter finding, the trial court had relied on PP v. Karim Othman [1994] 2 CLJ 826 HC, where it was held that the accused had “failed to rebut on a balance of probabilities the presumption of control and possession of the incriminating exhibits, and therefore of trafficking in the same”. In the above 3rd paragraph beginning with the word “Di pihak”, it was held that the prosecution could rely on s. 27 of the Evidence Act 1950, that P12 (the bag containing the drugs) was discovered as a consequence of the information given by the appellant who had guided the police party to his house and bedroom, that it was the testimony of the wife of the appellant that P12 had been used by the appellant, and that P12 consequently belonged to the appellant. In relation to the evidence of the defence that the bedroom was accessible to others, it was held that it was difficult to accept that story as it was not the practice of people in the East, especially people in traditional villages, to invade the privacy of a bedroom, and that it was difficult to accept that the bedroom could have been invaded during the one day that the appellant was away, and that there was no evidence that showed the truth of that defence. In relation to the submission by the defence that the appellant had no knowledge of the contents of P12, it was held that based on the evidence the appellant had knowledge. “Maklumat yang di berikan dan terkandung di dalam exh. P22 yang membawa kepada penemuan fakta dadah itu adalah berselari dengan hakikat ini.” In the next four paragraphs, the learned trial judge cited some legal authorities and then made his ruling on the purport and effect of s. 27 of the Evidence Act 1950.

[20] As said, there was no evaluation of the prosecution evidence. And the findings in relation to the defence were totally ipse dixit. No reasons were given for the findings that the defence could not be believed and that the demeanour of the appellant and his witnesses was akin to that of actors in court. Where reasons were given, they were not legitimate. How could it have been said as a statement of fact that people in the East would invariably respect the sanctity of another’s bedroom? If that were so, then there would not be that many incest, and housebreaking crimes.

[21] The finding that the denial of the appellant was not sufficient to rebut the presumption of possession and trafficking was a complete faux pas. It would not have been that out of order, had it been merely said that the denial of the appellant was not much of a defence or that the denial of the appellant had not cast any doubt. But it was totally indefensible to invoke the presumptions of possession and trafficking at the same time. The rule, as laid down by the Federal Court in Muhammed Hassan v. PP [1998] 2 CLJ 170 FC and followed by the Federal Court in PP v. Tan Tatt Eek and Other Appeals [2005] 1 CLJ 713 CA, Haryadi Dadeh v. PP [2000] 3 CLJ 553 FC and in PP v. Abdul Manaf Muhamad Hassan [2006] 2 CLJ 129 FC, is that there cannot be a presumption upon a presumption. Yet, we found, that apparent from the finding “Seperti yang diputuskan di dalam kes Public Prosecutor v. Karim Othman [1994] 2 CLJ 826 HC, penggantungan kepada bentuk pembelaan yang berupa ‘bare denial’ semata, tidak mencukupi untuk mengakas di atas prinsip imbangan kebarangkalian akan andaian/anggapan memiliki dan dalam kawalan dadah berbahaya serta pengedarannya”, that the learned trial judge had invoked both presumptions of possession and trafficking. That was a clear error in law.

[22] Also, the ruling to admit the information evidence – “suspek telah mendedahkan bahawa beliau ada menyimpan dadah ganja di rumahnya di alamat no. Lot 2132, Jambu Rias, 28600, Karak” – under s. 27 of the Evidence Act 1950 (see 58AR) could not be upheld.

[23]Section 27 of the Evidence Act 1950 provides, “When any fact is deposed to as discovered in consequence of information received from a person accused of any offence in the custody of a police officer, so much of that information, whether the information amounts to a confession or not, as relates distinctly to the fact thereby discovered may be proved”. “Section 27 is a concession to the prosecution … since the discovery itself provides the acid test, the truth of the statement that led to the discovery is thereby guaranteed. Admissibility of evidence under s. 27 is in no way related to the making of the confession; rather, such evidence is admitted on clear grounds of relevancy as directly connecting the accused with the object recovered” (Chandrasekaran & Ors v. PP [1970] 1 LNS 11, per Raja Azlan Shah J, as HRH then was). “… s. 27 is an exception to the prohibition imposed by the preceding ss. 24, 25, and 26 …” (Wai Chan Leong v. PP [1989] 1 CLJ (Rep) 171; [1989] 2 CLJ 1168 SC).

[24] That s. 27 is independent of s. 24 was reaffirmed in Goi Ching Ang v. PP [1999] 1 CLJ 829 FC, where Chong Siew Fai CJ (Sabah & Sarawak) said as follows:

Section 27 is silent as to or bears no ligature to the voluntary nature or otherwise of the information. The words ‘whether the information amounts to a confession or not’ in section 27 relates merely to the character of the information, ie, whether it is a confession, or a statement falling short of a confession. In other words, unlike s. 27 when compared with ss 25 or 26 of the Evidence Act 1950, a comparison of s. 27 and s. 24 does not show that they contain any words or phrases bearing or capable of bearing any reference to one another. From the wordings in the two sections, they stand independently of each other.

[25] A caution is not a prerequisite. In Goi Ching Ang, at 520 – 521, the Federal Court imparted:

… once an information is proved to be within the province of s. 27, the trial court would admit it in evidence (see eg, Lee Kok Eng v. PP [1975] 1 LNS 82; [1976] 1 MLJ 125 (FC); PP v. Sandra Margaret Birch [1976] 1 LNS 112; [1977] 1 MLJ 129; PP v. Toh Ah Keat [1976] 1 LNS 118; [1977] 2 MLJ 87 (caution not administered under s. 113 of the Criminal Procedure Code); Sum Kum Seng v. PP [1981] 1 LNS 76; [1981] 1 MLJ 244 (FC); Wai Chan Leong v. PP [1989] 1 CLJ 171 (Rep); [1989] 2 CLJ 1168; [1989] 3 MLJ 356 (SC) (drug trafficking case – no caution administered under s. 37A(b) of Dangerous Drugs Act); Choo Yoke Choy v. PP [1992] 1 CLJ 43 (Rep); [1992] 4 CLJ 1791; [1992] 2 MLJ 632 (SC) notwithstanding that the said information might not have been given voluntarily. (See eg, PP v. Er Ah Kiat [1965] 1 LNS 136; [1966] 1 MLJ 9, Chandrasekaran & Ors v. PP [1970] 1 LNS 11; [1971] 1 MLJ 153; Chong Soon Koy v. PP [1977] 1 LNS 20; [1977] 2 MLJ 78 (FC)).

[26] “There is no duty on the prosecution to establish the voluntariness of the information” (Amathevelli R Ramasamy v. PP [2008] 4 CLJ 413 CA, per Raus Sharif JCA). But that is not to say that information could be extracted from an accused. Information must be properly and fairly obtained, and not compelled from an accused (Lam Chi Ming & Ors v. R [1991] 3 All ER 172). Indeed, in Goi Ching Ang, the Federal Court opined that voluntariness is desirable (see 524), that the court should ensure that the standards of propriety in obtaining s. 27 information are scrupulously followed, and that the court has a discretion to exclude “evidence obtained in an oppressive manner by force or against the wishes of an accused person or by trick or by conduct of which the police ought not to take advantage” (see 527). The same was also held by the Federal Court in Francis Antonysamy v. PP [2005] 2 CLJ 481 FC. Recently, in Krishna Rao Gurumurthi v. PP & Anor Appeal [2009] 2 CLJ 603 FC, the Federal Court per Richard Malanjum CJ (Sabah and Sarawak) held that the admission of information evidence does not demand voluntariness or the absence of any form of oppression, inducement, threat or promise to the maker, but that the court has the discretion to exclude it on the ground that its prejudicial effect outweighs its probative value.

[27] Yet ” … for s. 27 … to apply, the information must be such as has caused the discovery of a fact. In other words the fact must be the consequence and the information the cause of its discovery … the information must relate distinctly to the fact discovered” (Wai Chan Leong). ” … in order for the section to apply there must be evidence of the information upon which the fact was discovered” (Evidence, Practice & Procedure, 2nd edn by Augustine Paul, at p. 258). ” … the first step which must be taken before s. 27 can be invoked at all must be proof of some fact discovered as a result of the information given by the accused” (Hamiron Mat Udin & 2 Ors v. PP [1947] 1 LNS 32 HC per Murray-Aynsley; see also Pang Chee Meng v. PP [1992] 2 SCR 1, where it was held that emphasis is placed on the fact discovered and not on the information, for the fact discovered confirms the truth of the information).

[28] “Section 27 is not intended to let in a confession generally and not one word more of the information which the accused supplied should be given in evidence that is strictly necessary to show how the fact which was discovered is connected with accused so as in itself to be a relevant fact against him” (Krishnan Ramar v. PP [1987] CLJ (Rep) 145; [1987] 1 CLJ 28 SC per Wan Sulaiman SCJ). Consequently, courts must guard against the danger of the abuse of s. 27.

[29] In Hasamuddin Talena v. PP [2002] 2 CLJ 504 CA, Gopal Sri Ram JCA, as he then was, said as follows:

Approximations are not permitted. In other words, the exact words spoken by an accused have to be proved. An illustration of that proposition may be found in Pang Chee Meng v. PP [1992] 1 CLJ 265 (Rep); [1992] 1 CLJ 39, where Abdul Hamid Omar LP reminded us of the need for vigilance, ‘to ensure the credibility of evidence by the police personnel in respect of this section, (that is, s. 27) which is so vulnerable to abuse. The rationale for the rule adverted to a moment ago appears in the judgment of Syed Agil Barakbah J (as he then was) in Birch v. PP [1977] 1 LNS 114; [1978] 1 MLJ 72. This is what he said:

Information leading to the discovery must relate distinctly to the object so recovered and nothing more. Only so much of such information is admissible. Where such information is held to be admissible, the action of the accused which directly leads to such discovery, in this case the act of the appellant in approaching the green bag and opening it, is of little value and ought to be treated with caution as it is prejudicial to the accused. Further, there was no indication one way or the other what had caused the appellant to lead the police there. Whether her intention was to confess her guilt or to indicate Mohd Desa’s guilt still remain uncertain. To my mind, since more than one inference has arisen, the inference in favour of the defence ought to be accepted.’

Since nothing more than the information given by an accused is admissible, it follows that the information must be exact and recorded in the language or words used by the accused. The strictness of the rule in the application appears sufficiently from the following passage in Sarkar on Evidence (14th Ed) at p 492:

Statements made by accused to police officers which are or may be provable under s. 27 should be clearly and carefully recorded. They should be recorded in the first person, that is to say, as far as possible in the actual words of the accused. They should not be paraphrased (In Re Athappa Goundan AIR [1937] Mad 618; Re Ramamurthy AIR [1941] M 290; Naresh v. R 46 CWN 180; Public Prosecutor v. Pasala AIR [1945] Mad 2021; Public Prosecutor v. Venkoba [1937] MWN 73; Chenna v. King Emperor AIR [1940] Mad 710; Gaya v. State AIR [1957] All 459; Nathuv State AIR [1958] All 46). No judge should allow one word more to be deposed to by the police than it is absolutely necessary to show how the fact discovered is connected with the accused.

[30] The alleged information evidence could not have passed the stringent conditions for admission. In the first place, there was uncertainty as to the actual words that were spoken by the appellant. The alleged information that SP2 (Inspector Jong Lak Kho) recorded hours after it had been given and hours after the raid (see 61AR) was “suspek telah mendedahkan bahawa beliau ada menyimpan dadah ganja di rumahnya di alamat no. Lot 2132, Jambu Rias, 28600, Karak” (see exh. P22). But the alleged information that SP2 related in court was quite different, for it was the testimony of SP2 that the information from the appellant was “saya ada simpan dekat rumah” (see 45 – 46AR), or “dia ada simpan ganja di rumah, dia setuju untuk bawa ke tempat itu … dia ada beritahu saya rumahnya iaitu di Jambu Rias” (see 46AR), or “saya ada simpan ganja, dekat rumah di Jambu Rias” (see 46AR). The proscribed drugs were found in a bag in one of the bedrooms of Lot 2132 Jambu Rias, Karak. It was not found near Lot 2132 Jambu Rias, Karak. But given that the actual words of the appellant were not unambiguously proved, in that there were at least 2 different accounts of the alleged information, then it could not be said that the fact discovered must be the consequence and the alleged information must be the cause of its discovery. Exhibit P22 should have been rejected on that ground alone. In any event, the confessional content “saya ada simpan ganja” in the alleged information, which was eminently prejudicial, should not have been admitted. Indeed, the entire exh. P22 could have been rejected on the ground that it was not a contemporaneous record of the alleged statements of the appellant. In fact, exh. P22 was not even a record of the alleged statements of the appellant. More than anything else, exh. P22 was SP2′s record of the events that had transpired hours before “berdasarkan kepada ingatan saya” (see 67AR). Really, nothing spoke for admission of exh. P22.

[31] Without exh. P22, the prosecution had simply no case. The appellant was arrested probably miles from the said house, while the proscribed drugs were found inside a bag (P12) in a bedroom of the said house. Indisputably, the appellant was not in actual physical custody or control of the proscribed drugs. In those circumstances, so as to prove possession of the proscribed drugs, the prosecution had to prove that the appellant had exclusive possession of the bedroom to begin with. But exclusive possession of that bedroom was not proved, for that bedroom was the bedroom of SP4 and appellant (see 79AR and 85AR). Worse still, the evidence was that the bedroom had no door (see 85AR) and was accessible to neighbours and friends (see 86AR). Admittedly, there was the evidence from SP4 that the Appellant was the owner of the bag (P12). But that evidence from SP4 was obtained, or was it extracted or coerced, from SP4 in the course of the impeachment proceedings taken by the prosecution against her (see 80AR). At the end of the day, all that was proved against the appellant was that in the bedroom that he shared with SP4 was arguably his bag (P12). But exclusive possession of that bedroom was not proved, and hence it could not be inferred that the appellant had possession of the drugs inside his bag. Perhaps the appellant had knowledge of the drugs, but “mere knowledge … is not sufficient to establish possession (see Gooi Loo Seng v. PP [1993] 3 CLJ 1 SC). A prima facie had not been made out. At any rate, the whole thing was a complete mistrial.

[32] It was for those reasons that we had allowed the appeal, set aside the conviction and sentence, and acquitted the appellant when we heard the appeal on 25 May 2009.

Intellectual Property: INTEL CORPORATION V. INTELCARD SYSTEMS SDN BHD & ORS HIGH COURT MALAYA, KUALA LUMPUR

INTEL CORPORATION V. INTELCARD SYSTEMS SDN BHD & ORSHIGH COURT MALAYA, KUALA LUMPUR[CIVIL SUIT NO: D8-22-1381-02]ABDUL WAHAB SAID JC16 OCTOBER 2003

JUDGMENT

Abdul Wahab Said JC:

The plaintiff is a well-known corporation dealing primarily in the manufacture of microprocessors that forms the integral part of office and personal computers, laptops and smart cards.

The plaintiff had been around since 1968 and had made a reputable name for itself worldwide as the pioneer and the largest manufacturer of microprocessors. The 1st defendant was incorporated in 1997 and deals in smart cards and IT security solutions.

The plaintiff came to know about the 1st defendant in November 2001 when one of its solicitors in Hong Kong, Rembert Meyer-Rochow was surfing the web and stumbled across www.intelcardsystems.com. The domain name is visually deceiving and any ordinary member of the public will tend to associate the 1st defendant and its product as the plaintiff’s. This is even more so since the plaintiff is manufacturing microprocessors, which forms the basis of smart cards, which the 1st defendant is dealing in. The plaintiff feels that the 1st defendant’s services and products are wanting in quality and as such would cause irreparable damage to the plaintiff’s well established goodwill and reputation.

With that in mind, the plaintiff, through its solicitors, sent a “cease and desist letter” dated 28 November 2001. The 1st defendant responded, denying that the word “intel” in its name was misleading or “confusingly similar” to that of the plaintiff’s trade name and trademark.

Attempts to settle this matter amicably were made from early January 2002 to early February 2002. The plaintiff offered to waive all claims for damages and costs if the 1st defendant agreed to comply with a proposed Deed of Undertaking where the 1st defendant would undertake to withdraw the name “Intelcard”.

The plaintiff averred that the 1st defendant would agree to settle if the plaintiff pays US$350,000. Not in the practice of making such payments in infringement situations, the plaintiff nevertheless counter – offered a lesser amount of US$ 8,000 to expedite the matter. The 1st defendant wanted it raised to US$25,000.

The likelihood of a settlement nowhere in sight, the plaintiff came to this court to seek relief. The plaintiff, inter alia, sought a permanent injunction to restrain the defendants from using the name “INTEL” in its trade and passing off its business as that of the plaintiff’s.

Pending the disposal of the main suit, the plaintiff filed summons in chambers encl. 5, for an interim injunction to restrain the defendants from doing the above mentioned acts.

In her submission, learned counsel for the plaintiff relies on the three principles in American Cyanamid v. Ethicon Ltd.(HL) 2 WLR 316, ie:

(A) there are serious issues to be tried;

(B) damages are not adequate remedy;

(C) the balance of convenience lies in favour of the plaintiff.

(A) Serious Issues To Be Tried

By incorporating the 1st Defendant under the name of “Intelcard Systems Sdn. Bhd.”, registering the domain name www.intelcardsvstems.com and actively trading in smart cards and smart card technology systems, the Defendants had committed:

I. the tort of passing off;

II. conspiracy to injure.

Those are the serious issues to be tried that the plaintiff has sought to prove.

I. Passing Off

For the tort of passing off, the plaintiff laid down three requirements that must be fulfilled. They are:

(a) goodwill and reputation of the name “INTEL”

(b) a misrepresentation by the 1st defendant that they are associated with the plaintiff; and

(c) damage to the plaintiff’s business as result of that misrepresentation.

(a) Goodwill And Reputation

The plaintiff, in seeking to prove that it has established a reputation and goodwill in Malaysia and throughout the world, has laid down its background and history for the benefit of the court.

The plaintiff’s history started in 1968 when it was incorporated in the U.S.A. to develop a product known as the “semiconductor memory”. Robert Noyce, one of its co-founders, is the joint inventor of the integrated circuit that made the running of today’s computers possible. The plaintiff, besides pioneering the technology, is the world’s largest producer of microprocessors, systems and software. More than 80% of the world’s servers and computers are based on the Intel architecture. The plaintiff also manufactures microprocessors for use in smart cards.

The “Intel” trade mark has been valued at US$ 30.11 billion in August 2002. The plaintiff had formed many subsidiary companies in Malaysia. The plaintiff established its presence in Malaysia in 1972, having its first factories in Penang and Kulim. At present, it has design and development facilities in Penang, Kulim and Cyberjaya. With a workforce of 80,0000 strong, the plaintiff now invests a total of RM4.4 billion in Malaysia.

The plaintiff’s subsidiary companies in Malaysia are Intel Malaysia Sdn. Bhd., Intel Technology Sdn. Bhd., Intel Microelectronics Sdn. Bhd., Intel Products Sdn. Bhd., Intel Electronics Sdn. Bhd. and Intel MSC Sdn. Bhd. The Plaintiff has obtained registration of Trade Marks in Malaysia numbering ten in all, including the famous “Intel Inside”.

The plaintiff’s Trade Mark had been used for 30 years in Malaysia. Until 2000, the plaintiff had achieved sales exceeding US$ 400 million. Its collaboration with MIMOS and Maxis Communications had benefited Malaysian small and medium scale industries in a big way. The plaintiff, through its subsidiaries, has trained thousands of workers in Malaysia and had been involved in transfer of skill and technology.

The Government of Malaysia recognizes that the plaintiff has made major contributions to the economy and industrial growth of the country. Datuk Craig Barret, the plaintiff’s President and Chief Operating Officer, is a member of the MSC and advises the Government on the MSC and its development.

The plaintiff had also contributed substantially in the country’s education sector, conducting exhibitions, launching the “Intel Teach” program and investing in curriculum equipment.

The plaintiff says that the defendant, by using the name “Intelcard Systems Sdn. Bhd.”, had caused confusion to the general public, making it appear as if the defendant is in some way connected to the plaintiff. This is because like the plaintiff, whose microprocessor and architecture made possible the production of millions of electronic identity cards, known as MyKad, to the Malaysian public, the defendant is also involved in the field of information technology and smart cards.

(b) Misrepresentation

By virtue of the fact that the plaintiff already had six subsidiaries in Malaysia, all with the prefix “INTEL” to their names, the 1st defendants’ name “Intelcard Systems Sdn. Bhd.” is bound to mislead the general public into thinking that it is also one of the plaintiff’s subsidiaries dealing in business or smart cards.

The famous “Intel Inside” embossed prominently on the outside of computers, the publicity given by the Malaysian Government on the involvement of Intel in MSC, the production of MyKad and in the country’s rapid industrial growth, makes Intel’s presence widely known to Malaysians. Thus, the defendants’ acts of using the Intel name whilst knowing of the goodwill and reputation of the plaintiff had misrepresented a false connection and association with the plaintiff.

Learned counsel for the plaintiffs submitted that the tort of passing-off is not restricted to situations involving competing traders in the same line of business. It includes cases of false suggestion by a defendant that its business is connected with that of the plaintiff that would be capable of damaging the plaintiff’s goodwill.

The plaintiff’s learned counsel cited the case of Lego System, A/S v. Lego M. Lemelstrich Ltd.[1983] FSR 155 at p. 184, where Falconer J said:

Spalding v. Gamage led the way to recognition by judges of the other species of the same genus, as where although the plaintiff and defendant are not competing traders in the same line of business, a false suggestion by the defendant that their businesses were connected with one another would damage the reputation and thus the goodwill of the plaintiff’s business.

Learned counsel for the plaintiff submitted that although their businesses may not be entirely similar, the plaintiff in microprocessors and the defendant in smart cards, the plaintiff’s technology is used to power smart cards. Hence, the field is substantially related. Customers in the trade would be led to believe that the 1st defendant’s smart cards are related to the plaintiff, what with the use of a name such as “Intelcard”.

On this point, the plaintiff submitted the case of Dun & Bradstreet (Singapore) Pte Ltd v. Dun & Bradstreet (Malaysia) Sdn Bhd [1994] 1 CLJ 369, where:

… the court also refers to Television Broadcasts Ltd v. Home Guide Publication Co.[1982] FSR 505 where the Plaintiff was in the business of broadcasting a women’s program and the defendant was in the business of publishing magazines for women. The Court held that there was a sufficient association between the parties’ fields of activity to lead to confusion among the public.

Further, on factors that would cause confusion to likely customers or members of the public, is the choice of name itself. The plaintiff claims that, contrary to what the defendants had said in their affidavits, there is no known short form for the word “intelligent”, such as to justify their choice for the name “Intelcard systems“. However, the test is not justification, but:

… whether in the choice of such a name resembling that of another existing entity, it will create the falsehood that the business of one is an extension or a branch of another or that they are somewhat connected. (Slim Rivertex Ltd. & Anor. v. Slim Rivertex Sdn. Bhd. & Ors.[1991] 3 CLJ 664)

(c) Damage To Plaintiff’s Reputation And Business

Learned counsel for the plaintiff, referring to the cases of Draper v. Trist Tristbestos Brake Linings Ltd[1939] 56 RPC 225 and Compagnie Generale Des Eaux v. Compagnie Generale Des Eaux Sdn Bhd [1996] 2 BLJ 519 says that the law presumes that if the goodwill of a man’s business has been interfered with by the passing-off of goods/business, damages results thereof, he need not wait to show that damage has resulted, he can bring his action as soon as he can prove passing-off, because it is one of the class of cases in which the law presumes that the plaintiff has suffered damage.

The defendant’s learned counsel in his submission denies the defendant had committed the tort of passing-off. This is by virtue of the fact that there are hundreds of companies all over the world including USA and Malaysia, where INTEL is used in their names. The learned counsel proceeded to give examples of such names, numbering 17 in all, in Malaysia and 7 in Australia. Many of these companies are involved in some aspects with electronic devices and systems. There are also companies using similarly sounding names like “Intell” and names of four corporations in Malaysia and Australia are given as examples.

There are also international bodies bearing the word INTEL like INTELSAT – International Telecommunication Satellite Consortium and INTELPOST -International Electronic Post.

Learned counsel for the defendant reiterated that the word Intel is an abbreviation of “Intelligent”. The learned counsel gave INTELLISOF-OASYS – Chennai, India and INTELLIRAD Solutions – Australia as examples of these companies’ names.

The defendant’s learned counsel submitted that the word “Intel” cannot be distinctive because of the presence of hundreds of companies all over the world which bear the prefix “Intel” in their names. There could also be no deception by the defendant’s use of that name because the presence of these hundreds of other companies with the word “Intel” is not causing any damage to the plaintiff’s reputation and is not deceptive. There is also no deception because the defendant had been operating openly and there had not been any reported incidence of falsehood, deception or conspiracy. The defendant referred to the case of Lam Soon (M) Bhd v. Forward Supreme Sdn Bhd & Ors [2001] 4 CLJ 673 on the issue that the allegation of passing-off, damage to the plaintiff’s reputation is not supported by any evidence at all, despite active business operations of the defendants since 1997 in the same market.

As for the defendant’s domain name, www.intelcard.com.my, the defendant’s learned counsel contended that there is no evidence of confusion and deception because several domain names all over the world also have the word “Intel”. Learned counsel gave nine examples from USA, Spain, England and India, including www.intelsystems.com, USA.

II. Conspiracy To Injure

The plaintiff refers to the defendant’ registration of the trade mark “IntelCard Systems Sdn. Bhd.”, knowing fully well that the plaintiff has formed a reputable business here under the “INTEL” trademark. In furtherance of its objective, the 1st defendant had set up a web site bearing the domain name www.intelcardsystems.com and is widely accessible to net users worldwide. By doing the above acts, causing the incorporation and registering the domain name with Tucows Inc. USA, the 1st defendant have made a false representation to the public that the defendant is in some way connected to the plaintiff.

The plaintiff further refers to the defendant’s demand for monetary compensation to change its name to show that the defendants are conspiring to injure the plaintiff economically.

Learned counsel for the defendant denies that there is a conspiracy to injure. The defendant did not to seek monetary payment from the plaintiff after it was incorporated. It was the plaintiff who offered to buy the right to the name Intelcard. The offer was initiated by the plaintiff and not demanded by the defendant.

(B) Damages Will Not Be An Adequate Remedy For The Plaintiff

The fundamental principle is whether the plaintiff should be confined to his remedy in damages or if the plaintiff would not be adequately compensated by an award of damages, whether, if the defendant succeeded at the trial, they would be adequately compensated by the plaintiff’s undertaking as to damages.

The plaintiff submits that it will suffer serious and irreparable loss and damage to its business, and the goodwill associated with it if the defendants are not restrained by this court from continuing with their acts of passing off. Damages are inadequate remedy to the plaintiff where the defendant’s flagrant acts of cashing in on the plaintiff’s goodwill and reputation are concerned.

The plaintiff refers to the guidelines to undertake in an application for interlocutory injunction in Keet Gerald Francis Noel John v. Mohd Noor Abdullah & Ors [1995] 1 CLJ 293, particularly:

the financial position of the Plaintiff to meet its undertaking is a factor and in some circumstances, Plaintiff is required to give an undertaking as to damages but if justice merits the granting of an interlocutory injunction, this factor will not be relevant.

Learned counsel for the defendant says that damages will not be adequate remedy to the defendants because an interim injunction, if granted will be as good as a final injunction and the damage that would be suffered by the defendant is irreparable.

The defendant also claims that the plaintiff’s action is untenable because it has not succeeded in taking action against all the other companies using the name “Intel” in Malaysia and around the world.

(C) Balance Of Convenience

The plaintiff’s learned counsel submits that the balance of convenience is in favour of granting the interlocutory injunction to the plaintiff inter alia, on the following grounds:

(i) damages will not be an adequate remedy;

(ii) the defendants will not suffer irreparable damage which cannot be compensated for in costs for the reasons stated in the affidavit.

The plaintiff’s learned counsel cited the case of American Cyanamid v. Ethicon Ltdon this point, where Lord Diplock said:

The extent to which the disadvantages to each party would be incapable of being compensated in damages in the event of is succeeding at the trial is a significant factor in assessing where the balance of convenience lies;

With net revenues for the financial year 2001 at US$ 26.5 billion, the plaintiff submits that it is ready and willing to fulfill any undertaking as to damages in the event that the court subsequently decides that damages herein ought not to have been granted.

The defendant’s learned counsel on the other hand says that the balance of convenience lies in not granting the injunction because to do so would virtually shut down the defendant’s business whereas the plaintiff would not be affected since the presence of hundreds of companies with the word “Intel” has not caused any damage to the plaintiff’s business. Further, the defendant had been in business since 1997 and there had not been any damage to the plaintiff’s business.

The defendant raised the issue of Delay and Acquiescance on the part of the plaintiff in bringing this action. The defendant said that despite the fact that they had openly traded under the present name since 1997, the plaintiff only took action in 2002. Because of this delay, the defendant had already spent a lot of money in expanding its business, recruiting and training staff and promoting its products. All these will go to waste if injunction were to be granted.

Learned counsel for the defendant cited the case of Leo Pharmaceutical Products Ltd v. Kotra Parma (M) Sdn Bhd [2002] 6 CLJ 465 where:

… the plaintiff had not taken any action for 25 months from the time they knew of the existence of the contentious products. This considerable delay reflected their uncertainty of the defendant’s alleged infringement. Thus, their application was dismissed as the relief sought is equitable in nature and it is trite law that delay defeats equity.

After hearing submissions from both sides, I granted the interim injunction, but only against the 1st defendant. my reasons for this decision are as follows:

(A) Serious Issues To Be Tried

Firstly, on the issue of passing-off, the plaintiff, in laying out its history in information technology, starting from its pioneering technology in the manufacture of microprocessors that forms the lifeline of today’s computers and its involvement in making possible this country’s quantum leap towards industrialisation, had no doubt established that it has goodwill and reputation of the name “INTEL”.

As for misrepresentation by the 1st defendant that they are associated with the plaintiff, I find as follows:

From the above submissions, it is abundantly clear that the defendant cannot say that the name “Intel” is not distinctive. I cannot come to any other conclusion than that the name “Intel” in its 34 years of incorporation had become so synonymous with computers and information technology. It is inconceivable that anyone, even more so a company delving entirely on information technology, more precisely the manufacture of smart cards, can overlook that fact.

The plaintiff manufactures microprocessors no doubt, and the defendant deals in smart cards. However, the plaintiff’s microprocessor and Intel architecture powers these smart cards. The relationship is close. It is such that any likely customers in the trade might be forgiven to think that the defendant is in some way connected to the plaintiff, such as being its subsidiary, dealing in smart cards. The incorporation of the defendant with the prefix ‘INTEL’ creates such misrepresentation as to give rise to confusion not only because of use of the name ‘INTEL’ by defendant but also because of the close connection in the field of business and goods offered and sold by the plaintiff and the defendant. In Dun & Bradstreet (Singapore) Pte Ltd. v. Dun & Bradstreet (Malaysia) Sdn. Bhd. (supra)the defendant was in general trading business whereas plaintiff was in the business of providing credit card information services. In granting interlocutory injunction, the court held that ‘general trading’ could well include the plaintiff’s sphere of activity because from the name of the parties, any person dealing with them would have thought that the other party was the same company or a branch or extension of the other.

A cause of action for passing off may lie even in a case where the plaintiffs and defendants are not competing in the same kind of trade. In Lego System, A/S v. Lego M. Lemelstrich Ltd. (supra)the plaintiffs are manufacturers and distributors of children toys sold and marketed under the trademark ‘LEGO’. The products are in the form of construction kits, the parts of which are made of moulded colour plastic materials. The defendants, an old established Israel company, were manufacturers of gardening equipment including garden spray and sprinkler made of plastic and marketed under the same trademark ‘LEGO’ in some 40 countries but prior to 1979 had not been concerned with the U.K. market. Plaintiff filed a quia timetaction against the defendants. On the issue of misrepresentation, Falconer J was satisfied that the plaintiff had established that there was a real risk that a substantial number of persons among the relevant section of the public would in fact believe that there was a business connection between the plaintiffs and defendants.

From the defendant’s submission, it can only be derived that it is based on a simplistic view that there are hundreds of other companies using the “Intel” name without permission; why pick on the defendant? I cannot help but disagree with such a suggestion. Just as absurd is the defendant’s suggestion that the plaintiff’s action against the defendant is untenable because it has not succeeded in taking action against hundreds of companies with the “Intel” prefix as mentioned by the defendant.

The defendant’s advertising in the Yellow Pages and trading openly cannot legitimize the defendant’s actions. The real test is whether the defendant, in using the “Intel” name, whilst knowing of the plaintiff’s goodwill and reputation in the name, is seen as calculated to deceive and steal the business or commercial advantage of the plaintiff and to misrepresent a false connection and association with the plaintiff.

From the plaintiff’s submissions and affidavits, it can be deduced that the plaintiff admits that there are many companies all over the world using the “Intel” name without the plaintiff’s permission. The plaintiff had been taking these infringers to court. It is an ongoing process. However, whilst actions are pending against these infringers, new infringers emerge. The defendant is just one of them.

The defendant’s action, if left unabated, will cause damage to the plaintiff’s reputation and business. In Bulmer (HP) Ltd v. J Bollinger S.A.[1978] RPC 79, Buckley J at p. 95 said:

It is well settled that a plaintiff in a passing off action does not have to prove that he had suffered damage by loss of business or in any other way. A probability of damage is enough but the actual or probable damage must be damage to him in his trade or business that is to say damage in his goodwill in respect of that trade or business.

If the goodwill of a man’s business has been interfered with by passing-off of goods or business, damages results therefrom. Likewise, the plaintiff in this case need not wait to show that damage has resulted. To do so, might encourage more infringers to commit acts just as flagrant, culminating in the plaintiff being shoved out of oblivion, as just another generic name for a computer component.

I am satisfied that the issue of infringement and passing-off had been successfully raised by the plaintiff. These are serious issues to be tried. The defendant’s reasons as I have observed above, cannot refute this assertions.

(B) Damages Will Not Be An Adequate Remedy

The serious and irreparable loss which the plaintiff might suffer if the injunction is not granted is already stated above. I am of the opinion that it matters not that the plaintiff is a giant in the Information Technology world and the defendant is a small company. The plaintiff had by its own toil and effort managed to secure its presence in this country and had contributed in no small way in this country’s industrialisation process. The defendant’s flagrant acts of cashing in on the goodwill that the plaintiff has built over the three decades will damage the plaintiff’s reputation severely, such that damages will not be adequate remedy.

However, if at the end of the day, things do not go the plaintiff’s way, I do not have the slightest doubt, from the figures that the plaintiff had displayed, that the plaintiff will easily be able to compensate the defendant.

(C) Balance Of Convenience

I am mindful of the advice given by Lord Diplock in American Cyanamid v. Ethicon Ltd, where His Lordship had said:

… The court is not justified in embarking on anything resembling a trial of the action on conflicting affidavits in order to evaluate the strength of either party’s case.

Even though we are at an interlocutory stage where pleadings and evidence are incomplete, it may not be improper for the court to take into account in determining where the justice of the case lie, the relative strength of each party’s case as revealed by the affidavit evidence on the hearing of the application. This could be done where it is apparent on the facts disclosed that there is no credible dispute of the strength of the plaintiff’s case.

I am nevertheless satisfied from the evidence adduced in the affidavits and arguments set forth by learned counsels on both sides in their submissions, that damages will not be an adequate remedy to the plaintiff.

I am satisfied that the balance of convenience tilts in favour of the plaintiff in that the defendants will not suffer irreparable damage which cannot be compensated by costs. By its incorporation, knowing fully well that the plaintiff is the proprietor of the name ‘INTEL’, the 1st defendant had chosen to take the risk.

I cannot agree with the defendant that it will be virtually shut down if injunction were to be granted. The injunction is to prevent the defendant from using the name ‘IntelCard’ as it is confusingly similar to the plaintiff’s name ‘INTEL’ and is likely to give rise to confusion. It does not prevent the defendant from carrying on with its smart card business under any other name.

(D) Delay In Bringing This Action

Injunction is an equitable remedy. Nevertheless, I am unable to agree with the defendant that the plaintiff had delayed in bringing this action. The defendant cannot assume that just because it was incorporated six years ago in 1997, the plaintiff should be aware of its presence. Just as it had raised in its submission, there are hundreds of infringers using the “Intel” name. The plaintiff cannot be expected to be able to discover the defendant’s presence and activities until its solicitor came across the defendant’s domain name in the net in 2002.

The plaintiff only took action in 2002 because it was trying to reach an amicable settlement with the defendant, but was not met with a favourable response.

For the reasons hereinbefore stated, I grant the interim injunction with costs against 1st defendant upon the plaintiff’s undertaking for damages.

Intellectual Property: CREATIVE PURPOSE SDN. BHD. & ANOR. V. INTEGRATED TRANS CORPORATION SDN. BHD. & ORS. HIGH COURT MALAYA, KUALA LUMPUR

CREATIVE PURPOSE SDN. BHD. & ANOR. V. INTEGRATED TRANS CORPORATION SDN. BHD. & ORS.HIGH COURT MALAYA, KUALA LUMPURRK NATHAN JC[CIVIL SUIT NO: D5-22-165-1995]

24 JANUARY 1997JUDGMENT

RK Nathan JC:

Background

Both the 1st and 2nd plaintiffs are engaged in the business of designing, developing and marketing of software programs.

The 1st plaintiff was incorporated in Malaysia on 23 November 1993 and became a wholly owned subsidiary of the 2nd plaintiff on 17 March 1994 when the initial two paid-up shares were transferred to the 2nd plaintiff.

The Malaysian operations are currently conducted by the 1st plaintiff.

It is common ground between the parties that prior to the incorporation of the 1st plaintiff, the Malaysian operations had been conducted by another Malaysian incorporated company called Creative Software (M) Sdn. Bhd. (CSM) which was incorporated on 18 May 1990.

It is also common ground that CSM was wound up by a Court order on or about April 1994.

Unlike the 1st plaintiff which is a wholly owned subsidiary of the 2nd plaintiff, CSM had common directors and shareholders with the 2nd plaintiff.

The two shareholders of CSM at all material times were Guyler Magruder and Rachel Swee Mei Ting who were also respectively the technical director/chairman and managing director of CSM. Fact Relied on by the Plaintiffs

In or around January 1991 the 2nd plaintiff first published for sale and distribution in Malaysia the software program called MEP3. This particular software was never published in Singapore or elsewhere.

The 2nd plaintiff subsequently allowed the 1st plaintiff to improve on the MEP3 program, such that each improved version appeared as a new and upgraded version of MEP3.

There have so far been four upgrades, namely MEP 3.30, MEP 3.31, MEP 3.32 and MEP 3.33. It is the contention of the plaintiffs that the copyright in each of the new upgrades or versions as a whole resides in the 1st plaintiff. The Mechanics of the Software Program

The plaintiffs’ case is that the software programs were designed as comprising two main modules, namely:

(a) a ‘loader program’, and (b) the ‘main program’.

The loader is encoded with a special protection code as a deliberate protection against unauthorised copying.

The loader functions to start up the main program, but the main program cannot be accessed if the special code in the loader fails to detect the presence of a particular copy protection device.

Between 1985 up till June 1994, the copy protection device used was the “key diskette”. In mid 1994, the “key diskette” was replaced by a new method of protection involving the use of a “dongle”, a hardware attachment fitted to the printer part of a computer.

The dongle functions in the same way as the key diskette.

Instead of detecting the presence of the key diskette, the protection code in the loader program looks for the presence of the dongle.

In January 1995 MEP 3 version 3.32 was released by the 1st plaintiff with enhanced features.

An advanced protection code was incorporated preventing access into an option or function program known as “Initialise Payroll” unless a dongle was present. A feature called “Potongan Cukai Berjadual” was incorporated in the program, and access into the “Potongan Cukai Berjadual” program could only be achieved through the “Initialise Payroll” function.

From January 1995 all registered users of the plaintiffs were converted to the dongle-based copy protection system.

The plaintiffs’ case is that the 1st and/or 2nd and/or 3rd defendants infringed the copyright in MEP 3, 3.32, 3.33 by reproducing without licence or consent, these software programs, and distributing the infringing copies to the public.

They also submit that the defendants have modified these softwares to circumvent the dongle. Matters Relied on by the Defence

The defendants deny that any copyright subsists in the Easy Series software, or that the 2nd plaintiff is the creator or owner of the copyright.

They also deny that the 2nd plaintiff published the Easy Staff, Easy Cash, or Easy Asset softwares simultaneously in Malaysia and Singapore.

In respect of Easy Pay 3, the defendants deny that it was first published in Malaysia in or around 1991 or that it was never published in Singapore at all.

The defendants also contend that the improved versions are the joint works of the 1st plaintiff and the 1st and 2nd defendants and that therefore the 1st and 2nd defendants were joint owners of the copyright.

The defendants further contend that they had the licence or consent of the plaintiffs to make reproductions of MEP 3, 3.32 and 3.33 by virtue of the terms of an alleged oral distributorship agreement made between the 2nd plaintiff and the 1st defendant in or about June 1987.

Further it was the contention of the defence that the plaintiffs had acquiesced in the various acts done and as such were estopped and precluded from denying the implied licence of the defendants in reproducing, distributing and modifying the Easy Series and the improved versions.

In particular, with reference to the copy protection device it was contended that the 2nd plaintiff had agreed since the inception of the oral agreement, to incorporate security features as developed by the 3rd defendant and as such it was agreed that the 3rd defendant would be allowed to modify the 2nd plaintiff’s Easy Series so as to ensure that the Easy Series are compatible and could work with the said security features.

The defendants contend that there is no evidence implicating the 2nd and 3rd defendants. The Computer Program

In order for me to assess the level to which copyright protection can extend, and how such materials can be infringed it is necessary to understand the essential nature and characteristics of a computer software program.

The Copyright Act 1987 (‘the Act’) defines “computer program” as follows:

“computer program” means an expression, in any language, code or notation, of a set of instructions (whether with or without related information) intended to cause a device having an information processing capability to perform a particular function either directly or after either or both of the following:

(a) conversion to another language, code or notation;

(b) reproduction in a different material form; (s. 3)

Jacob J in Ibcos Computers Ltd & Anor. v. Barclays Mercantile Highland Finance Ltd. & Ors. [1994] FSR 275, 285 very graphically described the workings of a computer and I can do no better than reproduce the same:

Computers only work in binary code, a code made up of O’s and 1′s. So all data held in a computer or held on a computer storage device (such as a RAM, disc or tape) must be so coded.

Likewise computer programs – the instructions to the processor as to what to do with data – must be in binary form. A binary program code is called an “object code” or, more graphically, “machine code”. Computers

are given so-called “operating systems”. These are a kind of basic program concerned with essential computer functions.

Popular operating systems are, for instance, MS-DOS, and Unix.

There are a number of others.

These systems are themselves, when in the computer, in binary code.

When an applications program (i.e. one which will be used for a particular application) is loaded into the computer it is loaded, as it were, on top of the operating system.

The applications program speaks to the operating system which speaks to the computer.

Now binary form is practically impossible for a human to read or write.

Humans write programs in a particular language called a higher level language.

That language must have a perfect syntax and grammar.

Computers are unforgiving: there is no room for irregular verbs with them.

Programming languages are a mixture of words of English and a system of a kind of algebraic instructions.

There are many such languages. A popular language of some antiquity is COBOL. A variant of this usable only on digital computer company’s (DEC’s) products is DIBOL and a later variant of DIBOL, usable on other companies’ machines is DBL.

The program the human writes is called the “source code”. After it is written it is processed by a program called a compiler into binary code.

That is what the computer uses.

All the words and algebraic symbols become binary numbers.

Now when a human writes he often needs to make notes to remind himself of what he has done and to indicate where the important bits are.

This is true of life generally and for programmers.

So it is possible to insert messages in a source code. A reader who has access to it can then understand, or understand more readily, what is going on. Such notes, which form no part of the program so far as the computer is concerned, are called “comments”. They are a kind of sidenote for humans.

In the DIBOL and DBL programs with which I am concerned, a line or part of a line of program which is preceded by a semi-colon is taken by the compiler as a comment.

That line is not translated by the compiler into machine code.

The program would work without the comment.

It follows that although the computers are unforgiving as to spelling in their programs, they do not care about misspelt comments in the source code.

If a line of operational code (a ‘command line’) is modified by putting a semi-colon in front of it, it ceases to be operational.

The computer treats the code as a mere comment.

Computer programmers sometimes do this with a line which pre-exists when they no longer want that line, but are not sure they may not need it in the future.

Or, if the programmer thinks he may want to add a feature to his program in the future he may put in a comment allowing for this.

He is unlikely in the latter instance to put in detailed code only to comment it out. A general note will do.

Source code, being what humans can understand, is very important to anyone who wants to copy a program with modifications, for instance to upgrade it. It is the source code which shows the human how it all works, and he or she will also get the benefit of all the comments laid down by the original programmer.

Software houses not surprisingly normally keep their source code to themselves and confidential.

Page 287:

Most programs are complicated and have a history of growth. A typical applications program will in fact consist of a number of individual programs linked in various ways, accessing data held in the computer for various purposes. … Moreover most applications programs undergo a more or less continuous process of organic growth.

Individual programs are updated, features are added or modified and so on. Large software houses issue new versions of their programs from time to time.

Sometimes the upgrade is given a new number: lesser modifications tend to be given an old number with a new decimal place.

Is There Copyright Protection for Software Program

Having considered the numerous cases cited by both parties, it is possible to sieve from the numerous judicial observations, that copyright protection for software program is strongly entrenched, and that the Courts have shown a willingness to extend the protection to both the object as well as the source codes.

In fact, a set of instructions which is embedded into an integrated circuit is conferred protection as well.

It is my finding that the definition under s. 2 of the Act should be read broadly so as to include all manifestations of that set of instructions which can be read by a computer in whatever converted form.

This would therefore clearly cover the “dongle” device of the plaintiffs. The Technics of the Malaysian Easy Series Program

PW2, whose evidence was uncontroversial, said that each of the Easy Series software packages is divided into two components, namely:

(a) the main program, and (b) the loader.

Both are instructions for the computer.

The loader functions to initialise and load and execute the main program into the memory of the computer.

The main program for MEP3 is an application program for payroll management, being the specific function it sets out to perform.

Essentially it is a valuable database program, being an ordered collection of payroll data.

When sold, the complete package of MEP3 consists of two diskettes and a user manual.

The two diskettes contain the loader and the main programs, the loader being the smaller of the two.

When an update (an improvement) is done, an update disk is supplied to the user.

The update disk only carries files containing changes to the existing main program.

In itself it is not a complete program.

When installed, the update disk will refresh the existing copy of the main program. MEP3. Com and Bpayroll.ovl

MEP3. COM is the name of the loader program which loads and executes the MEP3 main program, named BPAYROLL.OVL. The plaintiffs contend that the defendants infringed not only the loader, but also BPAYROLL.OVL, the main program. The Copy Protection Device

PW2 gave evidence to the effect that when a copy protection device is included in the software package, a protection code is wrapped around the loader program, namely the loader would then have two programs.

By June 1994 there was introduced the dongle form of protection which consists of two main components: the hardware device and a software component.

The latter component is a computer program as well. PW2 said he had to write two separate programs for the dongle protection system, that is, first, a program to insert a coding into the dongle and second, a program to wrap a corresponding coding around the loader, which will check for the presence of the dongle before the loader allows access into the main program.

In respect of MEP 3.32, another coding was added to the main program to allow for a check to be done during the operation of the main program itself.

The plaintiffs therefore contended that the defendants infringed this particular computer program when they ‘patched’ or modified the MEP3. COM file and BPAYROLL.OVL file.

The defendants in reply argue that there is no evidence adduced to show who owns these two components of the MEP software. I reject this argument because in the case of MEP 3.30, 3.31, 3.32 and 3.3, since copyright will vest in the entire work, it is only logical that copyright in the entire enhanced BPAYROLL.OVL file as well as MEP3. COM file will vest with the plaintiffs. Circumvention of the Dongle Protection Device is Infringement

The plaintiffs submit that the facts of this case establish that the defendants had actually “hacked” and “patched” the plaintiffs’ copyright programs directly and flagrantly.

It is noteworthy that a somewhat similar set of circumstances occurred in Autodesk Inc. & Anor. v. Dyson & Ors. [1992] AIPC 38, 182, 183, 184.

The appellants held the copyright in a computer-aided design program called AutoCAD, which was sold with a hardware protection device called an AutoCAD lock.

The AutoCAD program was a compilation of programs, one of which was a program known as Widget C. Widget C would send out a set of instructions to the AutoCAD lock, and the response from the AutoCAD lock must correspond to a “look-up” table in its memory.

Only where the correct response was received would the main program run.

By observing the electronic signals passing between the computer and the AutoCAD lock, the third respondent managed to work out the sequence of correct responses and thereafter devised a substitute for the AutoCAD lock which he called “Auto Key lock”. The High Court of Australia on appeal from the Full Federal Court held there had been infringement, although the substitute device was created without direct copying or reproduction of the written computer program. Originality Issue

Both parties concede that the relevant programs for my consideration are as contained in the Easy Pay Series.

The defence argue that there is no dispute that the original Easy Pay 3 program was developed by the 2nd plaintiff, a Singaporean and that the subsequent versions are based on this original version.

The defendants contend that the plaintiffs have failed to establish that the later versions are original works protectable under the Act. The crux of the question, submitted the defendants, is whether the plaintiffs have revised the original Easy Pay 3 program sufficiently to attract fresh copyright for the subsequent versions of Easy Pay 3 program.

It was the submission of the defendants that the plaintiffs had not led evidence to make the relevant software Easy Pay 3.30, 3.31 or 3.33 original in character.

It was contended that even in the case of the Easy Pay 3.32 the evidence showed that there was insufficient effort done to render the same original of the plaintiffs.

In any event, the defendants relied on Warwick Film Productions Ltd. v. Eisinger [1969] Ch 508 and submitted that the person who does the improvement is only entitled to copyright protection for the improved version.

In the Warwick Film the plaintiffs alleged that the defendants had infringed their copyright in two books, namely The Trials of Oscar Wilde and Oscar Wilde: Three Times Tried. In his account of the proceedings of the trials, the author of the first book, Hyde, had copied substantially from the account in the second book.

Hyde, however, also did a good deal of editing.

The first defendant who wrote the alleged infringing work did not make any direct use of the second book; instead he copied parts of the proceedings as reproduced in the first book.

It was held that both books were entitled to copyright.

However, in so far as the first defendant had copied Hyde’s unedited copying, and very little of his edited copying, there was no reproduction of a substantial part of the work and therefore no infringement.

It was urged upon me to hold by way of implication that the Warwick Film suggests that a person who subsequently improves an existing work is only entitled to sue for his improved portion and not the part of the work which is copied.

Therefore by comparison to the present case it was submitted that unless the plaintiffs could show that the improved portion of the Easy Pay 3.2 is original to the plaintiffs and that the defendants have infringed this portion as well, there ought to be no case for infringement of copyright.

The defendants argue that the changing of commands from one program language to another language could be effected by special program tool and rather mechanically.

In such a case there is no creativity involved at all.

Thus it was contended that Easy Pay 3.32 is not original and did not therefore attract fresh copyright.

In response the plaintiffs relied on the judgment of Jacob J in Ibcos Computers (supra) wherein the learned Judge said at p. 289:

Logically therefore the claim in copyright calls to be tested in the following order:

(1) What are the work or works in which the plaintiff claims copyright?

(2) Is each such work “original”?

(3) Was there copying from that work?

(4) If there was copying, has a substantial part of that work been reproduced?

The plaintiffs pointed out that by virtue of s. 3 of the Act the definition of “literary work” includes:

(h) computer programs and compilations of computer programs,

I was also referred to s. 7(2) of the Act which states:

(2) Works shall be protected irrespective of their quality and the purpose for which they were created.

The plaintiffs referred to the decision of Costello J in Allibert S.A. v. O’Connor & Anor. [1981] FSR 613, 621 wherein he opined:

These authorities also illustrate the principle that copyright protection is given to the work and not to the idea and that it is not originality of thought that has to be established to obtain copyright protection but original skill and labour in execution.

So, copyright protection can exist in a product drawing even though it is based on an earlier product drawing.

What the court has to determine in a disputed case is whether the designer has performed sufficient independent labour to justify copyright protection for the drawing he has produced …

Having considered the various cases cited by both parties, I am of the view that s. 7(2) of the Act is more relevant to the present case.

This sub-section provides that although the quality of a work is unimportant, a literary work is eligible for copyright only if the following requirements of sub-s. (3) are fulfilled, in that:

(a) sufficient effort has been expended to make the work original in character; and

(b) the work has been written down, recorded or otherwise reduced to material form.

In the circumstances, I hold that each individual program in a whole package comprising a composite computer program attracts individual copyright subject to it being “original”. I am supported in this view by the decision of Jacob J in the Ibcos case (supra) wherein the learned Judge said at p. 289:

Accordingly in my judgment the copyright works include not only the individual programs but the whole package.

Moreover in every case where a program was revised or modified enough for a fresh copyright to be created, that copyright is also a relevant work.

I accept as good law the proposition of Costello J that copyright protection is given to the work and not to the idea and that so long as original skill and labour is extended, copyright protection must prevail. A computer program, as a species of “literary work”, under Malaysian law, is eligible for copyright if “sufficient effort” has been expended on it to render the work “original” and the work is “reduced to material form”. It is the case of the defendants which I shall come to later, that the plaintiffs had infringed CSM’s copyright in MEP 3.24 or whatever earlier relevant version authorised by CSM’s employees.

However, s. 7(4) of the Act which reads,

(4) A work shall not be ineligible for copyright by reason only that the making of the work, or the doing of any act in relation to the work involves an infringement of copyright in some other work.

provides the answer to this contention.

Even if such an allegation is true, the resultant program of the plaintiffs, if “original” will attract separate copyright by virtue of this subsection. PW3 said in evidence that he had to write a new series of command lines and put that in another file.

He then had to create another file incorporating the formula given by the government and program the necessary command lines so that when executed it would apply the correct formula.

He admitted that it was not an easy task as he had to insert, add or modify nearly 4,000 lines of commands in C language.

This evidence I find has not been disproved by the defendants who merely attempted to highlight similarities between MEP 3.32 and 3.24 through the evidence of DW3. Further, when exh. P11(a) was demonstrated to me in open Court, the very clear statement of copyright ownership, vesting in the 1st and 2nd plaintiffs in the opening screen display puts paid to any claim to ownership by CSM.

In so far as this Court is concerned what is in issue is the copyright ownership in MEP 3.32 and 3.33, not 3.24 and any other earlier version done by CSM.

Referring to the Warwick Film (supra) relied on heavily by the defendants to back up their submission that a person who subsequently improves an existing work is only entitled to sue for his improved portion, I cannot agree that that was the view of the learned Judge.

The learned Judge said at p. 530:

Counsel also submitted the alternative argument that, as a matter of law, copyright can subsist in some parts of a literary work without subsisting in other parts, and that no copyright will be held to subsist in those parts which consist of copied raw material on which no labour and skill have been expended.

In support of these propositions Counsel cited Low v. Ward ([1868] LR 6 Eq. 415), Leslie v. J. Young & Sons ([1894] AC 335 HL) and Macmillan & Co. v. Cooper ([1923] 40 TLR 186 PC).

I do not, however, propose to refer to these cases in any further detail because recently the House of Lords has preferred a different approach to the problem which arises where a literary work includes unoriginal or pirated material. I refer to Ladbroke (Football) Ltd. v. William Hill (Football) Ltd. ([1964] 1 WLR 273; [1964] 1 All ER 465, HL(E)).

Plowman J then referred at length to the Ladbroke case, particularly the judgments of Lords Hodson, Devlin and Pearce, where the principle laid down clearly rejects the “dissection” argument (that is, that one could dissect parts of a work and attribute copyright only to parts and not the whole, in cases where a work builds upon a prior existing work). His Lordship continued at p. 532 by quoting Lord Hodson:

The defendants have sought to argue that the coupons can be dissected and that upon analysis no copyright attaches to any of their component parts and accordingly no protection is available.

In my opinion, this approach is wrong and the coupons must be looked at as a whole.

Issue of Ownership of the Program

It is the plaintiffs’ case that the 2nd plaintiff is, and was at all material times, the copyright owner of the original programs in the following business application software products, namely:

(a) Easy Staff, a human resource management software.

(b) Easy Cash, a cash flow software.

(c) Easy Asset, an asset depreciation management software.

(d) Easy Pay 3, a payroll processing software designed solely for the Malaysian market.

These are collectively called the Easy series.

Except for Easy Pay 3 (MEP3) which was designed and published solely in Malaysia in or around January 1991 the plaintiffs contend that the other Easy Series products were published for sale and distribution both in Malaysia and Singapore.

The plaintiffs’ central claim on the pleadings is copyright infringement in that there has been infringement by the defendants of the 1st plaintiff’s copyright in various relevant versions of the MEP3 software, and likewise, the 2nd plaintiff’s copyright in MEP3. It is the plaintiffs’ contention that copyright in the MEP3 series’ later versions and upgrades are jointly owned by the 1st and 2nd plaintiffs and that the fact of joint ownership is supported by a statutory presumption in the Copyright Act 1987; see s. 26(4)(a) which states that the name on a work purporting to be the name of its author shall be considered as such, unless the contrary is proved.

It was the plaintiffs’ submission that although they have pleaded the infringement issue in terms of unauthorised reproduction and distribution of the Easy Series, the thrust of their claim rests on infringement of the MEP3 software, in particular Easy Pay Versions 3.30, 3.31, 3.32 and 3.33. This, the defendants agree in their submission.

The defendants submitted that even if the 1st plaintiff had proved that the Easy Pay 3.32 program was their original work, they had failed to establish that they are the rightful owners of the same.

It is common ground that the Easy Pay 3 program was first developed by the 2nd plaintiff in Singapore.

But it was argued that unless there is sufficient publication within Malaysia, such Singaporean program is not protected in Malaysia.

This was because the 2nd plaintiff being incorporated in Singapore and a non-Berne Convention country, could only claim copyright protection if the conditions relating to first publication as laid down in s. 10(2) of the Act are fulfilled.

The defendants relied on a passage from Copyright Law in Malaysia by Khaw Lake Tee 1994 Edn. pp. 23-24:

Under s. 10(2), all works, with the exception of works of architecture and broadcasts, to which special rules apply, are entitled to copyright if they are first published in Malaysia, that is, they are made available to the public. A work is also deemed to be first published in Malaysia if it was first published elsewhere but was subsequently published in Malaysia within 30 days of that first publication.

This means that if a work was first published in Singapore and was subsequently published in Malaysia within 30 days of that publication in Singapore, the work would be protected under the Copyright Act 1987.

As from 1 October 1990, all works first published in any of the Berne Union countries are also entitled to copyright protection in Malaysia, regardless of whether they are published in Malaysia itself.

It was the submission of the defence that the plaintiffs had not produced any evidence of the first publication of the Easy Pay 3 program in Malaysia.

The plaintiffs replied stating that whilst the original Easy Pay software program was created by the 2nd plaintiff, evidence had been led by the plaintiffs that MEP3 was designed specifically for the Malaysian market and was published and released in Malaysia in and around January 1991.

It is my finding that whilst the plaintiffs have led evidence to prove publication in Malaysia, the defendants have not at all introduced any evidence to show otherwise.

Whilst I accept as trite law that the overall burden of proof lies on the plaintiffs, the evidential burden in relation to this particular issue, as it has been raised by the defendants, has to be discharged by the defendants.

Since I have found that the defendants have failed to discharge that burden, such a contention remains a bare allegation unsupported by evidence.

The evidence led by the plaintiffs is through PW2 who had stated how MEP3 program came to be developed (sometime in January 1991) and that the first sales were recorded in February of the same year and these items of evidence were tendered as part of the agreed bundle of documents (ABD1).

The defendants then contended that there was no evidence that the subsequent versions of Easy Pay 3.1, 3.2, 3.24 were created and owned by any of the plaintiffs.

In fact evidence showed that these versions of Easy Pay 3 were created by CSM, now wound up. Since there was no evidence of any subsequent divesting of these programs to the plaintiffs, it was the defence submission that the copyright in these versions should still remain in the liquidators of CSM. Pointing out that the 1st defendant was only incorporated in 1994, it is not possible for it to own copyright in computer programs which were created prior to its formation unless there was a valid assignment of these programs from the previous owner.

The plaintiffs’ reply to this is that their claim to ownership and on which there is evidence of infringement by the defendants, are MEP 3.30, 3.31, 3.32 and 3.33. Earlier versions of the MEP series authored by CSM are not in issue.

They contended that whether copyright in versions 3.1, 3.2 and 3.24 vests in the liquidator of CSM or otherwise, is irrelevant for purposes of the present suit.

Likewise it is irrelevant for purposes of the present suit to consider whether these versions created by CSM have been divested to the plaintiffs.

I agree.

It is my finding that since CSM is not a party to this instant suit, it is impermissible to assume questions of ownership of these earlier versions without proper evidence being led and the issues proven.

In any event, I find no claim by the plaintiffs that the 1st plaintiff owns copyright in programs created prior to its incorporation in 1994.

From the entire pleadings and the evidence adduced the plaintiffs claim joint ownership of the copyright in MEP 3.30, 3.31, 3.32 and 3.33. Statutory Presumption Under s. 26(4) of the Act

The said subsection reads:

(4) Subject to subsection (3) -

(a) the name on a work purporting to be the name of its author shall be considered as such, unless the contrary is proved;

(b) in the case of an anonymous or pseudonymous work, the publisher whose name is indicated in the work as such shall be deemed to be, unless the contrary is proved, the legal representative of the anonymous or pseudonymous author and shall be entitled to exercise and protect the rights belonging to the author under this Act;

(c) in the case of unpublished work where the identity of the author is unknown, but where there is every reason to presume that he is a citizen of Malaysia, the copyright conferred by this Act shall be deemed to vest in the Minister charged with the responsibility for culture.

The plaintiffs argue that there is a statutory presumption in favour of the ownership being vested in the 1st and 2nd plaintiffs under s. 26(4). The defendants contend otherwise and say that s. 26(4) provides for name of the “author” of a work appearing on the work and that the said subsection is not concerned with the name of an owner.

The defendants urged upon me that authorship of a work is entirely different from “ownership” of the work.

The defendants relied again on Dr. Khaw Lake Tee’s text earlier referred to at p. 66 where she states:

Under copyright law, there is a distinction between authorship and ownership.

The author generally refers to the creator of the work while the owner is the person who is entitled to control the doing of the various restricted acts.

The author and owner of a copyright may not necessarily be the same person.

Relying on the definition of “author” in s. 2 of the Act the defendants argue that the “author” of a work must refer to a natural person.

This submission is refuted by the plaintiffs who contend that it is improper for the defendants to read that the entire subsection deals with the question of authorship and not ownership.

With regard to the defendants’ submission that s. 26(4) could only refer to natural persons the plaintiffs contend that if at all the word “writer” in s. 26(4)(a) can be read as limited to natural person, the word “maker” is of wider import and ought to be read as referring to corporate entities as well.

The submission of the defendants fails to consider the full import of s. 26. Section 26 reads “First ownership of copyright”. It is obvious therefore that where there is a claim to authorship which claim to authorship can even be presumed by the name of the author appearing on the works, then by virtue of sub-s. (3), which reads,

(3) Copyright conferred by s. 11 shall vest initially in the government, government organisation or international body and not in the author.

the claim to ownership (subject to s. 11 of the Act where the copyright in works shall vest initially in the government, government organisations and international bodies and not in the author), shall be presumed to also vest with the authorship.

Further the overall context and purpose of this s. 26 has to be considered.

Whilst the term “author” is defined in s. 2, the term “owner” is not.

It is also important when considering the question of statutory presumption of ownership under s. 26(4) to consider s. 10(1) of the Act, which reads:

(1) Copyright shall subsist in every work eligible for copyright of which the author or in the case of a work of joint authorship, any of the authors is, at the time when the work is made, a qualified person.

Section 10(1) makes it abundantly clear that “author” and “qualified person” share a common meaning. Section 3 defines “qualified person” as:

(a) in relation to an individual, means a person who is a citizen of, or a permanent resident in, Malaysia; and (b) 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;

In the circumstances, if an “author” can also mean a “qualified person” and “qualified person” is defined by the Act as including a body corporate, it cannot be right to read the word “author” in s. 26(4) as referring only to natural persons.

By the same token it is my judgment that the presumption raised cannot be limited to mere authorship, but should be properly read to cover the issue of ownership.

In Berjasa Information System Sdn. Bhd. v. Tan Gaik Leong (Trading as Jurukur Berjasa) & Anor. [1996] 2 BLJ 337 , I had found copyright ownership on the plaintiffs, a corporate entity.

Although this issue of the presumption of ownership as arising under s. 26(1)(4) was not raised as an issue in that case, I said this at p. 348:

I find from the documentary evidence and the affidavits, a clear intention to vest the copyright ownership on the plaintiffs.

From the time the software system was developed the plaintiffs’ claim to copyright was displayed prominently at

the start of the software system as copyright notice.

Neither of the defendants, registered a protest.

Indeed if the first defendant had only commissioned the plaintiffs to prepare the software system it was his duty to have claimed ownership forthwith and to move the Court promptly for an injunction to restrain the plaintiffs from so advertising.

In the fast developing sphere of corporate ownership it is incongruous to hold that a corporate body cannot claim entitlement to copyright ownership.

It is my finding that once there is a display on the program the name of a person, or a corporate body, then by virtue of s. 10 of the Act read together with s. 26(4) of the Act, copyright ownership shall vest in that said person or corporate body. Is There Joint Ownership by the Plaintiffs

It is the plaintiffs’ contention that copyright in the MEP3 series’ later versions and upgrades are jointly owned by the 1st and 2nd plaintiffs and that this joint ownership is supported by the statutory presumption arising from s. 26(4)(a) of the Act which spells out that the name on a work purporting to be the name of its author shall be considered as such, unless the contrary is proved.

The defendants deny that the 2nd plaintiff has established its ownership to the later versions of the MEP series.

The defendants argue that joint ownership can only arise from joint creation of the works or by assignment by one owner to the subsequent joint owners and that the plaintiffs had proved neither of these facts.

Since PW3, an employee of the 1st plaintiff had admitted in evidence that Easy Pay 3.32 was created by him, it was submitted that by virtue of s. 26(2) of the Act the rightful owner of the copyright, if any, should be the 1st plaintiff.

In any event, there is no evidence of subsequent divesting of the copyright to the 2nd plaintiff.

I find that it is the plaintiffs’ case that the MEP series is built upon an original version designed by the 2nd plaintiff.

Evidence has been led in any event, on how the development of the later versions of the MEP series received effort and input not merely from employees of the 1st plaintiff but of the 2nd plaintiff as well.

Notwithstanding the fact that the substantive work on the enhancement was essentially done by two programmers of the 1st plaintiff, PW3, a trained programmer of the 1st plaintiff, said in evidence:

For Versions 3.30, 3.31 and 3.32, there were two, myself and one Kamen Chia.

Chan Chee Kian acted as consultant.

Chan Chee Kian was PW2 and he is the computer programmer and analyst in the software department of the 2nd plaintiff since January 1991 and was made the software manager of the 2nd plaintiff in October 1993.

It is therefore my judgment that the need for, or the lack of an assignment, on this issue of joint ownership is irrelevant.

The issue as I see it relates to the creation of copyright in the later versions of MEP; not in the devolution of the same.

Be that as it may, in any event, since both the plaintiffs are agreed among themselves to have the copyright jointly-owned, it is not incumbent upon the defendants to deny this, unless the defendants can lead me to a clear statutory provision in the Act, that this cannot be done.

On the contrary, I am constrained to hold that sub-s. (5) of s. 27 of the Act, favours the plaintiffs’ argument since it provides,

… persons shall be deemed to be co-owners if they share a joint interest in the whole or any part of a copyright.

Implied Licence Granted by the Plaintiffs to the Defendants

It was the defence submission that in any event they had not infringed the copyright of any of the plaintiffs’ because there was an oral agreement between the plaintiffs and the defendants allowing the defendants to reproduce the relevant programs for the agreed purpose. DW1 (Chong Sun Foo) who was the director of all three defendants and DW2 (Rachel Swee Mei Ting) who was the former managing director of the 2nd plaintiff and CSM gave evidence regarding the existence of an oral agreement.

From the evidence adduced by these two witnesses the defendants argue that the said oral agreement, amongst others, provided that the defendants had the licence or consent of the plaintiffs to make copies, reproduce or modify the Easy Pay Series computer programs’ new enhancements, upgrades, updates, releases and versions whether developed or produced by the 2nd plaintiff or by any other parties authorised by it, in order to provide maintenance services to the ultimate purchasers/users of the Easy Pay Series computer programs including but not limited to the Malaysian Easy Pay Version 3 (MEP3). It was the further contention of the defendants that the said oral distributorship agreement was never terminated by the 2nd plaintiff, CSM or the 1st plaintiff and that it is therefore still valid and subsisting.

The plaintiffs replied by pointing out that DW1 under cross examination had said that the 1st defendant had no right to the source code.

If such is the case then the 1st defendant and indeed any of the other defendants as well, cannot really maintain that the defendants had the consent to modify the MEP 3.32 software so as to circumvent the dongle, since this could only be done if the defendants were provided access to the relevant source code.

Pressed in cross examination, DW1 referred to the terms in the software maintenance agreements signed between the 1st defendant and CSM. But it is clear from the terms of the software maintenance agreements that “all general enhancements and product updates aimed to improve the current version of the system” would be provided, but for new versions they had to be paid for, albeit at a 50% discount.

Apart from these software maintenance agreements, there is no written evidence to support and prove the alleged oral agreement.

I find that the evidence of DW2 in cross examination contradicted in material particulars the evidence of DW1. In cross examination DW1 conceded that the 1st defendant was not entitled to receive the source code of the programs. DW1 also agreed that the 1st defendant was not allowed to make changes to the files in the main programs, but was only allowed to “customise”. Even under reexamination DW1 again replied that the 1st defendant could not make changes to the main program, but could only customise in the sense of writing an external program to effect calculations to suit the needs of particular customers. I find on the evidence led by the plaintiffs that the 1st and 2nd defendants “hacked” files in the source code, and the main program. Acquiescence, Implied Consent and Estoppel

Alternatively the defendants submit that this action is wholly uncontestable by reason of the conduct, consent or acquiescence of the plaintiffs, of the defendants’ acts of reproducing and distributing the said improvements.

It was the submission of the defendants that the terms of the oral distributorship agreement have been put into effect by both the plaintiffs and the defendants since 1987 in the course of their business transactions.

The defendants have, since 1987 been reproducing the said improvements for the purpose of providing maintenance services to the ultimate purchasers or users of the Easy Pay series computer programs with the full knowledge of the plaintiffs at all material times.

It was also the defendants’ contention that the plaintiffs have at all material times tacitly recognised the relationship of principal and distributor entered into between the 1st defendant and the 2nd plaintiff initially, and thereafter with CSM until it was wound up and finally with the 1st plaintiff for a period of more than eight years and the said oral distributorship agreement has yet to be terminated until to date.

The defendants also submitted that during the eight years the plaintiffs and CSM have never by conduct objected to the reproduction and distribution of any of the improvements, including MEP3 whether it was developed or produced by the plaintiffs or CSM for the purposes of servicing the legitimate purchasers or users of the Easy Pay series computer software.

The defendants argue that the plaintiffs are thus estopped and precluded from denying and contradicting the implied licence of the defendants as granted by the plaintiffs and CSM. DW2 testified that the plaintiffs terminated the relationship of distributor and principal between the plaintiffs and the 1st and 2nd defendants when there was a change of management in the 1st plaintiff company and after the winding up of CSM.

As to why there is no documentary proof of any distributorship agreement, DW2 said that DW1 had sent a draft agreement but since it was only a standard draft agreement devoid of the peculiar arrangements already existing between the parties, the 1st defendant did not agree to it. Also since in the initial stages the business was not too big the defendants did not pay too much attention to the need for legal documentation. I was urged to accept this explanation.

The plaintiffs replied by stating that if the 1st and 2nd defendants can reproduce even new versions containing enhanced features, including enhanced security features such as the dongle, what possible protection would the plaintiffs have when new security features are introduced, if they can, with the same supposed tacit consent, be circumvented.

Further, I do not consider that there was such an oral agreement at all and in the circumstances this submission of the defence fails. No Case as Against 2nd and 3rd Defendants

The defence contended that there was no evidence whatsoever implicating the 2nd and 3rd defendants.

In fact DW2 had stated that the 3rd defendant had nothing to do with this case.

It was the defence contention that the plaintiffs had sued the wrong party.

The plaintiffs denied this and submitted that the evidence showed that the infringing copies of MEP 3.2 were distributed through the 2nd defendant as shown in exh. P3 which is a sample container in which the infringing diskettes are delivered to customers of the defendants.

The labels of these containers carry the name of the 2nd defendant.

These have not been denied by the defendants.

It was further submitted that DW2 in his evidence in chief had stated that the 2nd defendant is the appointed customer support service arm of the 1st defendant.

I find that the purchasers of MEP 3 who purchased from the 1st defendant signed maintenance contracts with the 2nd defendant for maintenance services in relation to MEP 3 including provision of updates for an annual fee.

In fact a copy of such a maintenance agreement with the 2nd defendant was exhibited at p. 34 of the agreed bundle of documents (ABD). The defendants all share the same registered addresses and have common directors and shareholders, in particular, DW2. The production and distribution of the infringing goods took place on the shared premises of all the defendants where some of the infringing items were seized, upon the execution of the Anton Piller Order dated 7 April 1995 issued by this Court.

There is also evidence to suggest that payments of maintenance fees for MEP3 were paid for and collected by the 3rd defendant.

In the circumstances, I hold that the plaintiffs are not misplaced in citing the 2nd and 3rd defendants as defendants herein. “Hacking”

Over the course of the decade, advances in technology have created the computer industry and consequentially this new industry, needless to say, has also spawned new and complex issues.

Throughout this case the term “hacking” has been used by the plaintiffs.

It is therefore necessary for me to see if its usage connotes the meaning attributed to it. It is pertinent to note that the term “hacking” can on the one hand signify the free-wheeling intellectual exploration of the highest and deepest potential of computer systems.

It describes the determination to make access to computers and information as free and open as possible.

However, on the other hand, it means intruding into computer systems by stealth and secrecy and the term “hacker” would refer to a computer intruder.

Hacking can also refer to the unauthorised access to computer systems by those who simply enjoy using computers and experimenting with their abilities in trying to invade a computer system as innocent hobbyists.

It could also refer to a youngster imbued with the thrill of challenge and just for the heck of it, hacks into a computer system.

In the software world hacking means computer programming.

It may also involve the decompilation or reverse engineering of computer programs with the aim of changing the behaviour of the program.

Computer hacking therefore, is an attempt to gain access into someone else’s computer account or data.

Coming to the case at hand from the evidence of the witnesses, I find the use of this term by the plaintiffs, justified. Damages

The plaintiffs submitted that the depreciation to the value of the copyright caused by the infringement was a chose in action.

In support of this proposition Ariff relied on Caxton Publishing Co. v. Sutherland Publishing Co. [1939] LR 179 HL where the House of Lords held in an infringement of copyright action that the act of binding together the infringing sheets with the innocent sheets so as to form the volume produced by the appellants, constituted the act of conversion in respect of which the respondents were entitled to damages.

On the question of damages the defendants submitted that as the Easy Pay 3.32 is partly derived from a work which belonged to CSM, a wound up company, and not the plaintiffs solely, the plaintiffs have themselves in fact infringed the copyright of CSM in reproducing the same without consent of the liquidator of CSM and that therefore the Court should not condone such unlawful act.

Therefore in the event the plaintiffs succeeded in proving infringement I was asked to deny the plaintiffs a right to damages.

Section 37(2) of the Act allows for the Court to assess damages in cases of infringement.

However, the same Act allows for additional damages where the Court has taken into consideration:

(a) the flagrancy of the infringement, and (b) any benefit shown to have accrued to the defendant by reason of the infringement.

The burden is on the plaintiff to prove damage, but not to a degree of certainty.

Flagrancy implies scandalous conduct, deceit including deliberate and calculated infringement where a defendant reaps a pecuniary advantage in excess of the damages he would have been found liable for; see Ravenscroft v. Herbert & Anor. [1980] RPC 193, 206. However I find that this is a proper and fit case for me to order an inquiry as to damages for infringement of copyright and an order for payment of all sums found due upon taking such an inquiry, together with interest thereon. I however declined to award for additional damages as I did not find the need to do so. The Counterclaim

Relying on the oral agreement between the 1st defendant and the plaintiffs that they should provide the free releases and upgrades to the defendants, the defendants claim breach of contract by the plaintiffs.

In the circumstances, they claim for damages.

The defendants relied on the evidence of DW2 which was to the effect that the plaintiffs had procured and induced a number of purchasers to buy direct from the plaintiffs the Easy Pay Series and their improved versions.

It was also the evidence of DW2 that the plaintiffs had copied the list of the 1st and 2nd defendants’ list of customers and have spread rumours that the defendants were resorting to unethical and unprofessional conduct which statements were all untrue.

Based on these the defendants claimed that they had made out a case for injurious falsehood and conspiracy.

The reply of the plaintiffs was that the defendants had failed to support the allegations of breach of contract, injurious falsehood and conspiracy with evidence.

The allegations of DW2 was unsupported by cogent evidence.

I find that this counterclaim by the defendants was a lacklustre effort, devoid of purpose and lacking in merit.

The defendants have not at all provided any or any sufficient credible evidence to support the bare assertions raised in their counterclaim and repeated in Court by DW2. In so far as the claim for breach of contract is concerned, since I had already found against the defendants on the question of the existence of the oral contract, the claim for breach of contract as pleaded in the counterclaim must perforce, fail.

In Wilts United Dairies Ltd v. Thomas Robinson Sons & Co. Ltd. [1957] RPC 220 Stable J very succinctly categorised the requirements to be made out for a case of injurious falsehood.

In that case it was alleged that the defendants, knowing what they were doing, purchased a large quantity of the plaintiffs’ “British Maid” tinned condensed milk, which they knew was old stock and stale stock, and put that milk into circulation through various wholesalers and retailers as being the normal standard of “British Maid” milk.

The plaintiffs complained that that was an injurious falsehood, or that it was a passing off, as being milk of the current production, milk that had, in the course of time, been relegated to a class of old or stale milk.

It was held that there had been passing off and injurious falsehood.

On the meaning of malice, Stable J said at p. 237:

As I understand the law it is this that you publish a defamatory statement about a man’s goods which is injurious to him, honestly believing that it is true, your object being your own advantage and no detriment to him, you obviously are not liable.

If you publish a statement which turns out to be false but which you honestly believe to be true, but you publish that statement, not for the purpose of protecting your own interests and achieving some advantage to yourself but for the purpose of doing him harm, and it transpires, contrary to your belief, that the statement that you believed to be true has turned out to be false, notwithstanding the bona fidesof your belief because the object you had in mind was to injure him and not to advantage yourself, you would be liable for an injurious falsehood.

The third proposition which I derive from the cases is this, that if you publish an injurious falsehood which you know to be false, albeit that your only object is your own advantage and with no intention or desire to injure the person in relation to whose goods the falsehood is published, then provided that it is clear from the nature of the falsehood that it is intrinsically injurious – I say ‘intrinsically’, meaning not deliberately aimed with intent to injure but as being inherent in the statement itself, the defendant is responsible, the malice consisting in the fact that what he published he knew to be false.

Whilst the pleadings bear out the requirements propounded by Stable J, with which categorisation I wish to totally associate myself, I am unable to find any line of testimony other than the mere unsupported assertion of DW2, to even suggest any evidence that could bear out the defendants’ claim on this ground.

In the circumstances, I dismissed the counterclaim with costs.

Taking into account all the circumstances of this case and after evaluating the evidence of the witnesses and the submissions of Counsel, and here I must express my gratitude to both Counsel for their thoroughness, I find that there has been clear infringement by the defendants who actually indulged in impermissible self help when “hacking” the files in the computer program owned by the plaintiffs.

It cannot be plausible to conclude, as the defendants venture to argue that they have the right to circumvent the dongle protection device, since otherwise all attempts by the plaintiffs to produce enhancements and strengthen security features will come to nought.

In the circumstances and in respect of the claim proper I granted the plaintiffs’ prayers for:

(a) A declaration that the 1st and/or 2nd and/or 3rd defendants have infringed the 1st and/or 2nd plaintiff’s copyright in Easy Pay 3 and its upgrades, and the 2nd plaintiff’s copyright in Easy Asset, Easy Pay and Easy Staff and its upgrades;

(b) A permanent injunction restraining the defendants or any one of them through their directors, officers, servants, agents, nominees or any one of them or otherwise howsoever from doing the following acts without the 1st and 2nd plaintiffs’ or the 2nd plaintiff’s (as the case may be) prior consent or licence, that is to say:

(i) modifying, varying or otherwise altering and/or reproducing copies (including such modified, varied and/or altered copies) or any part thereof of the 1st and 2nd plaintiffs’ computer software, Easy Pay 3, and of the 2nd plaintiff’s computer software, namely Easy Staff, Easy Cash and Easy Asset and/or any upgrade or upgrades and/or version or versions of the same, past, present or future (collectively, “the plaintiffs’ works”); and/or

(ii) selling, exposing and/or offering for sale or otherwise distributing by way of trade or otherwise the items aforesaid in para. (i) above;

(iii) decoding, tampering or otherwise interfering with the operation of any copy protection device accompanying the plaintiffs’ works; (iv) infringing in any manner whatsoever the 1st and/or 2nd plaintiffs’ copyright in the plaintiffs’ works;

(v) facilitating, causing, procuring and/or otherwise assisting in the doing of any of or all such acts aforesaid in paras. (i), (ii), (iii) and (iv) above.

(d) an inquiry as to damages for infringement of copyright;

(e) an order for payment of all sums found due upon taking such an inquiry as in (d) above together with interest thereon;

(f) costs.

Intellectual Property: BERJASA INFORMATION SYSTEM SDN. BHD. V. TAN GAIK LEONG (TRADING AS “JURUKUR BERJASA”) & ANOR. HIGH COURT MALAYA, KUALA LUMPUR

BERJASA INFORMATION SYSTEM SDN. BHD. V. TAN GAIK LEONG (TRADING AS “JURUKUR BERJASA”) & ANOR.HIGH COURT MALAYA, KUALA LUMPURDATO’ KAMALANATHAN RATNAM JC[ORIGINATING SUMMONS NO: D5-24-80-1994]20 DECEMBER 1995

JUDGMENT

Kamalanathan Ratnam JC:

By this originating summons the plaintiff a pray for a declaration that the digital mapping software system (hereinafter referred to as the “software system”) is owned with regard to the copyright by the plaintiffs. They also seek a further declaration that they are entitled to display the copyright notice on the software system and also pray for costs and such other relief they are entitled to.

In support of this application one Aw Kong Koy, the director and major shareholder of the plaintiffs affirmed an affidavit dated 12 April 1994. He confirmed that the plaintiffs were incorporated by him holding about 60%, of the shares and the first defendant who is also a director and shareholder of the plaintiffs holding about 40% of the shares. The said company was incorporated for the purpose of proposing and supplying the said software system. The said software system was based on a computer program for the map and asset management project (hereinafter referred to as “the project”) of the second defendants. It was averred that the proposal for the said software system was prepared wholly by the plaintiffs and presented to the second defendants in the name of the first defendant on 23 August 1990.

Need for the Computerised Digital System

The second defendants manage the water supply for the State of Perak and an essential requirement of water supply organisations is to keep records of the installations of pipelines, treatment plants, reservoirs and pump-houses. For pipelines this is especially important due to the fact that these are buried underground and records for pipelines are kept for several reasons, namely:

(a) To identify exact locations of pipes and to relate their locations with respect to other pipes and cables.

(b) To help determine condition of pipes, i.e. asset value.

(c) To record maintenance works on pipes.

(d) To record improvements or alterations on pipes.

Traditionally these records were kept manually by personnel in the drawing office. The drawings come in all sizes and scales and vary from imperial to metric. The plans are kept in storage cupboards and over the years, when some of these drawings have faded or were torn, duplicates were made. However, with the rapid development of the country, there has been a great demand in water supply installations with the corresponding workload imposed on drawing office personnel, increasing proportionately. Thus record keeping became a problem and as an up-to-date drawing register was not available and as various drawings were either misplaced, damaged or lost it became necessary to correlate all information through a computerised mapping system developed through a software system which would store maps and all information about pipelines as well as other assets, in a computer, thus allowing for one to look for example, at a map with different scales and with different features. All records are kept in a pre-defined way and were readily available. Hence the involvement of the plaintiffs in supplying this software to the second defendants through the first defendant.

The first defendant wrote to the plaintiffs vide his letter dated 10 January 1991 (exhibit AKK-2) assigning the development of the project (except the surveying part of it) to the plaintiffs. A copy of the said letter is reproduced herewith:

Bil. Kami: JB/SJ/90/LAP 11A 10.1.91

M/s. Berjasa Information System Sdn Bhd 75C, Jalan SS21/60 Damansara Utama 47400 Petaling Jaya Selangor Darul Ehsan

Dear Sir

PROPOSED DIGITAL MAPPING SYSTEM FOR LEMBAGA AIR PERAK

We refer to the above and are pleased to inform you that we have been appointed for the above project.

We are also pleased to advise that apart from the surveying part we are assigning the whole project to Berjasa Information System Sdn Bhd.

As is agreed we shall only charge a three (3) per cent fee on the claims made by you.

Please acknowledge receipt by returning a copy of this letter duly stamped and signed to us within seven (7) days.

Thank you.

Yours faithfully JURUKUR BERJASA

Sgd TAN GAIK LEONG M.I.S. (M), M.I.S.(Aust.), M.A.A.L.S. B. App. Sc. (SURVEYING) Aust. Surveyor Licenced Under Ordinance 11 of 1958

We, Berjasa Information System Sdn Bhd accept the assignment of the Proposed Digital Mapping System excluding the surveying portion and the condition as stated.

Sgd

… BERJASA INFORMATION SYSTEM SDN BHD

The first defendant thus retained the surveying part of the project to himself and assigned the rest of the project, i.e. the preparation of the software to the plaintiffs. He also specifically agreed to only charge a 3% fee on the claims made by the plaintiffs. The plaintiffs signed on the said letter accepting the said assignment and on the said terms. Then vide his letter dated 12 February 1991 the first defendant wrote to the second defendants that a company had been incorporated i.e. the plaintiffs, and that the consultancy for the software part of the system will be carried out by the plaintiffs (exhibit AKK-3). The first defendant then entered into an agreement with the second defendants whereby the first defendant labelled himself as consultants. It was a term of the said agreement that the copyright of the software system should remain the property of the consultants and that the second defendants would get 5% royalty from the sales of this version of the software to any other parties. In his affidavit the said Aw Kong Koy affirmed that he was the author of the said software which he prepared for and on behalf of the plaintiffs and he averred that in the circumstances the copyright of the said software system belonged to the plaintiffs. It was not in dispute that at the commencement of the software system the plaintiffs’ copyright notice is displayed as part of the software system, each time the software is used and it reads as follows:

Digital Mapping System for Lembaga Air Perak Version 1.0 Copyright (C) 1990, 1991 Berjasa Information System Sdn Bhd & Lembaga Air Perak All Rights Reserved

The defendants have been using the said software system since early 1991 and have never registered any objection nor protest over the plaintiffs’ claim to copyright as displayed in the copyright notice.

In addition, all meetings relating to the software system were held in the plaintiffs’ or the second defendants’ office; never at the first defendant’s. Further, the plaintiffs trained the staff of the second defendants and the second defendants gave permission to the plaintiffs to demonstrate the software system in a public exhibition at a conference at the request of the plaintiffs.

However on 15 March 1993 the second defendants sent a letter to the first defendant directing the first defendant to delete the plaintiffs’ name in the Copyright Notice. However the plaintiffs were never extended a copy of this letter. Then on 4 September 1993 the first defendant through his solicitors’ letter addressed to the plaintiffs, claimed copyright over the said software system. The first defendant relied on the agreement signed between himself and the second defendants wherein It was stated that the copyright of the software should remain the property of the first defendant and claimed such right over the plaintiffs. It was only as of 4 September 1993 that the first defendant claimed that the plaintiffs were commissioned to plan and/or prepare and/or programme the said software system. He also referred to the letter dated 15 March 1993 from the second defendants to him a copy of which he maintained was extended to the plaintiffs, and which the plaintiffs had denied receiving. It was demanded of the plaintiffs that they remove their name from the copyright displayed at the commencement of the software system. The plaintiffs then wrote to the first defendant vide their letter dated 9 September 1993 seeking an explanation or reason for the first defendant’s solicitors’ letter, since the first defendant himself was a director of the plaintiffs. The first defendant’s reply was curt. The solicitors’ letter he said was clear and he advised the plaintiffs to comply. The plaintiffs thus through their solicitors denied the first defendant’s claim to the copyright. Since the first defendant did not respond the plaintiffs then demanded a letter from the first defendant of an unequivocal withdrawal of any claims to the copyright of the said software system and threatened to revoke all licences accrued through their ownership of the copyright. The reply from the first defendant was headed “without prejudice” and contained reference to a term in the contract between the first defendant and the second defendants whereby the second defendants could terminate the said agreement if the consultants refused to comply with the written instructions of the second defendants and in this case the instructions were the erasure of the plaintiffs’ copyright notice from the software system. Subsequently by his letter dated 4 January 1994 the first defendant wrote to the plaintiffs that he no longer required their services. By their letter dated 25 January 1994 the plaintiffs invited the second defendants to join them as co-plaintiffs in their application for these declarations and stated that if the second defendants refused, they would be joined as co-defendants. The reply from the second defendants dated 2 March 1994 contended that they were not aware as to how the plaintiffs were involved in the agreement between them and the first defendant.

In his reply to the plaintiffs’ affidavit the first defendant who affirmed his affidavit on 21 September 1994 said that the plaintiffs had no locus and lacked authority to file the said application on the grounds that no resolution was passed. The first defendant contended that the entire issue rested on the interpretation to be put to the agreement between the first defendant and the second defendants and the letter assigning to the plaintiffs the project, i.e. for the plaintiffs to prepare the software system except the surveying part. The first defendant also referred to his letter dated 12 February 1991 (referred to earlier) and addressed to the second defendants whereby he confirmed appointing the plaintiffs as consultants over the said project and he adverted to his experience as a surveyor to have thought of this software system. The first defendant denied that the authorship of the software system belonged to the plaintiffs because he averred that based on the exhibit AKK-1 he had drafted the said proposal whereas all that the plaintiffs did was to type out andor key the said proposal into the making of the software system. The first defendant then confirmed in his affidavit that “apart from the surveying portion the rest of the project was to be performed by the plaintiffs and in particular by the deponent (i.e. Aw Kong Koy) who possesses the knowledge of writing a software for the said project.” It was also averred that without the help of the first defendant the plaintiffs could not have completed the said project. The first defendant sent two qualified surveyors to assist the plaintiffs in the preparation of the said project. The plaintiffs exhibited in their affidavit a bill for 3% fees charged by the first defendant for such services. The first defendant continued to maintain that he owned the copyright to the said software system. The first defendant maintained that at all material times the plaintiffs were aware that the second defendants had requested the first defendant to have the plaintiffs’ copyright notice removed from the software system. The first defendant in his affidavit denied the averment of Aw Kong Koy who referred to a letter dated 15 March 1993 from the second defendants to the first defendant directing the first defendant to delete the plaintiffs’ name from the copyright notice. If he denied the entire paragraph that includes denial of receipt of this letter. However in a later part of the same affidavit he refers to his solicitors’ letter dated 15 November 1993 and addressed to the plaintiffs’ solicitors which refers to the need of the first defendant to comply with the directive of the second defendants, specifically stated in their said letter dated 15 March 1093, requiring the deletion of the plaintiffs’ name from the copyright notice. On the one hand he denies receipt of the letter and on the other hand he refers to it specifically.

The second defendants then filed a further affidavit dated 1 October 1994 in which they confirmed the contents of the affidavit of the first defendant. In other words they have given no explanation to this material letter dated 15 March 1993 which the first defendant has denied receiving and which he subsequently referred to.

It is of common knowledge that affidavits are drafted by legal practitioners based on facts related to them by their clients. It is not only a legal duty of a practitioner but also his moral duty to address his mind properly to the preparation of an affidavit so that it would reflect a cogent and cohesive narration of facts being a true reflection of his client’s case. Affidavits drafted and filed in haste could lead to repentence at leisure. Filing of an affidavit without verification of the facts would lead to drastic consequences upon the deponent if subsequently his affidavit is shown to be untrue or materially false or in variance with expressions of statements made by the same deponent in other affidavits or letters relating to the same subject matter. A client is not expected to have the knowledge of a solicitor in legal draftsmanship. A practitioner thus owes a duty to prevent his client from affirming an affidavit that bears contradictions to any earlier averments. He and he alone being the master of the art of legal semantics, owes a duty to his client to safeguard him from a possible charge of making a false affidavit.

Aw Kong Koy then replied the first affidavit of the first defendant and the affidavit of the second defendants by affirming his affidavit on 28 December 1994 as director of the plaintiffs. He denied that he had no locus nor that he lacked authority to sue and he explained why there was no resolution because only he and the first defendant were the directors and as matters stood it would be well neigh impossible to get the first defendant to sign a resolution to sue himself let alone attend a board meeting. He also confirmed that the plaintiffs were originally incorporated as Equity Network Sdn Bhd on 8 March 1990 as a shelf company and that both he and the first defendant purchased it and changed it to its present name with effect from 28 March 1990. The plaintiffs denied that their share in the project was to merely type out and key in the said proposal. Aw Kong Koy affirmed that the proposal reflected knowledge and experience in database management technology as applied to spatial entities, computer graphics and software development methodology, and he contended that it was because of his experience that he owned 60% of the shares in the company and his director’s fees were three times that of the first defendant. He also exhibited two invoices whereby the first defendant had charged RM700 and RM308.80 for the cost of preparation of the documentation and the making of additional copies and if indeed the copyright belonged to the first defendant there would be no basis for the plaintiffs being made to pay any direct costs. The proposal which itself is an exhibit stipulated that the software system developed under the project would be the copyright of the developer; however in the agreement between the first defendant and the second defendants the word “developer” was substituted with the word “consultant”. The plaintiffs also challenged the first defendant to state who then was the author of the software system if it was not the plaintiffs, and further required the first defendant to state when he came to a decision that the copyright belonged to him. With regard to the second defendants the plaintiffs averred that permission from the second defendants, to display the software (which projected the offending copyright notice at its commencement) at the Paradox World Tour Seminar, had to be obtained because the display would involve releasing information belonging to the second defendants, i.e. their waterworks assets information being shown to the participants at the seminar. The plaintiffs contended that it was only through their solicitors’ letter dated 4 September 1993 (exhibit AKK-7) that the first defendant claimed copyright ownership over the software system, for the first time.

In reply to the second defendants’ affidavit the plaintiffs averred that the second defendants, by adopting the contents of the first defendant’s affidavit, had therefore agreed that save for the surveying part, the rest of the project was by way of an assignment to the plaintiffs and that the second defendants had knowledge of the purpose of the incorporation of the plaintiffs. The first defendant filed a further affidavit in reply affirmed on 6 April 1995 wherein he contended that by filing this action, Aw Kong Koy had failed in his duty as a director of the plaintiffs. It was also averred by the first defendant that the word “assign” was used to reflect the commissioning of services by the first defendant to the plaintiffs in consideration of a fee.

On 2 October 1995 the defendants raised a preliminary objection before Dato’ Hj Abdul Malek bin Hj Ahmad J (as his Lordship then was). The preliminary objection was that the plaintiffs had no locus to commence this action nor to appoint solicitors. After hearing full arguments the learned Judge dismissed the preliminary objection on 18 October 1985. Hence the hearing of this summons before me.

At the outset, parties agreed that there was not much dispute as to the facts presented. It was not in dispute that the plaintiffs were incorporated solely for the purpose of this project. It was also not in dispute that it was the first defendant who through his previous dealings decided on the feasibility study of canvassing with the second defendants the possibility of computerising their works for an efficacious management and record keeping of installation of pipes, pump-houses, treatment plants and reserviors and to store plans and drawings. However the first defendant is only a surveyor and he needed the expertise of Aw Kong Koy to plan, prepare and present the software system. Together they decided to form the plaintiffs. Upon a perusal of the letter dated 10 January 1991 from the first defendant to the plaintiffs and marked as AKK- 2, I find that it was a clear intention of the first defendant that the plaintiffs should author the software system minus that part that dealt with the survey. It is to my mind an unequivocal appointment to create the software system. For providing services the first defendant agreed that he shall only (emphasis provided) charge a 3% fee on all claims made by the plaintiffs. However, since Aw Kong Koy and the first defendant were the sole directors and shareholders of the plaintiffs in the proportion of 60% and 40% respectively, the two directors had evinced an intention to share in the profits of the plaintiffs only but that the authorship of the software system should at all material times vest in the plaintiffs. This view is all the more clear when I refer to the first defendant’s letter dated 12 February 1991 to the second defendants and which he had copied to the plaintiffs wherein he again unequivocally and without reservations confirmed that the plaintiffs were incorporated for the purpose of providing consultancy services. It is conceded by the defence before me that Aw Kong Koy was the one who had the computer knowledge and expertise.

It is the argument of the first defendant that he commissioned the plaintiffs to prepare the software system and thus the copyright belonged to him. However no where can I find any evidence to substantiate this submission. The actual work was done by Aw Kong Koy and if there was a need to merely commission, there was no need to incorporate the plaintiffs because the first defendant could have just commissioned Aw Kong Koy and pay him a fee. The very fact that the plaintiffs were incorporated showed that it was the desire of both the directors that whilst one director i.e. the first defendant prepared the survey and the proposal to the project, the other director, i.e. Aw Kong Koy would produce or author the software system incorporating the survey plans and drawings in computer calisthenics. Thus with a view to maintaining a long term relationship with the second defendants it was the intention of the two directors to vest the copyright in the plaintiffs and to give the second defendants a licence with a 5% royalty from the sales of this version of this software system to any other parties.

Expertise of Each Party

The expertise of each of the two directors in their respective branches of study is annexed to the proposal to the project. Clearly the first defendant is a licensed surveyor holding both a diploma and a degree in surveying. Aw Kong Koy on the other hand holds a First Class Honours degree in Mechanical Engineering and has been involved from 1987 to date as a computer application consultant. It was therefore an ideal combination to propagate computer litercy in the field of survey and such related works and it was of no surprise that the plaintiffs were incorporated for just this purpose. Can it therefore be said that the copyright ownership can rest in any of the two directors or that one commissioned the other?

I find from the documentary evidence and the affidavits, a clear intention to vest the copyright ownership on the plaintiffs. From the time the software system was developed the plaintiffs’ claim to copyright was displayed prominently at the start of the software system as copyright notice. Neither of the defendants, registered a protest. Indeed if the first defendant had only commissioned the plaintiffs to prepare the software system it was his duty to have claimed ownership forthwith and to move the Court promptly for an injunction to restrain the plaintiffs from so advertising. This he failed to do and the first time he ever registered his protest was by his solicitors’ letter dated 4 September 1993, i.e. more than two years later. Of course the second defendants had averred that they had informed the first defendant of their desire to have the plaintiffs’ claim to ownership of copyright removed. But other than an averment in an affidavit, the second defendants themselves wrote no letter to the plaintiffs and/or to the first defendant on this. Even if they did, such a letter was never exhibited.

The plaintiffs relied on estoppel. On this I need only refer to the case of Boustead Trading (1985) Sdn. Bhd. v. Arab Malaysian Merchant Bank Berhad [1995] 4 CLJ 283; [1995] 3 AMR 2871 CA where Gopal Sri Ram JCA applied the doctrine of estoppel. The conduct of the defendants in this case and their act of silence had estopped them from now claiming ownership of the copyright.

In any event since the claim to authorship or copyright is not to the proposal to the project which is a 101-page document called Digital Mapping System for Lembaga Air Perak, but to the software system I rely on

in relation to any other cases, means the person by whom the work was made

and since the software system was prepared by the plaintiffs through Aw Kong Koy I hold the plaintiffs as the author. The first defendant’s claim to ownership is also based on the agreement between him and the second defendants wherein the first defendant is referred to as the consultant. But that is between the parties to the agreement. The true intention as to who the author is, had already been conveyed by the first defendant to the second defendants vide their letter dated 12 February 1991 where they stated that the plaintiffs were incorporated to offer consultancy services and the said letter was copied to the plaintiffs.

Is there a Commissioning by the First Defendant?

The first defendant’s claim that he commissioned the plaintiffs is totally untenable. If indeed there was this alleged commissioning then I cannot see why a series of debit notes were forwarded by the plaintiffs to the first defendant for various services. There ought to have been one invoice for the entire sum claimed. These series of debit notes clearly constitute a running account between the two parties.

The next document to refer to with regard to the first defendant’s claim as to assignment is exhibit AKK-2 which I had reproduced earlier. The only fees referred to therein is the first defendant’s fees. If there was commissioning why did this letter not reflect the plaintiffs’ fees. As I have found that the plaintiffs are the authors, the burden rests on the first defendant to show if there was assignment for s. 26 of the Copyright Act 1987 to operate in his favour. He has in my view not done so.

The first defendant by his affidavit has not convinced me of his right to authorship. I need only refer to Lord Diplock’s views on a similar situation in Eng Mee Yong & Ors v. V. Letchumanan [1979] 1 LNS 18; [1979] 2 MLJ 212 PC at 217 :

Although in the normal way it is not appropriate for a Judge to attempt to resolve conflicts of evidence on affidavit, this does not mean that he is bound to accept uncritically, as raising a dispute of fact which calls for further investigation, every statement on an affidavit however equivocal, lacking in precision, inconsistent with undisputed contemporary documents or other statements by the same deponent, or inherently improbable in itself it may be. In making such order on the application as he “may think just” the Judge is vested with a discretion which he must exercise judicially. It is for him to determine in the first instance whether statement contained in affidavits that are relied upon ‘as raising a conflict of evidence upon a relevant fact have sufficient prima facie plausibility to merit further investigation as their truth.

In referring to similar sentiments expressed within our shores, I refer to Gopal Sri Ram JCA in Hock Hua Bank (Sabah) Bhd v. Yong Liuk Thin & Ors [1995] 2 CLJ 900; [1995] 2 MLJ 213 CA at 220 wherein his Lordship said:

Whenever a Court is required to judicially appreciate affidavit evidence, it is a necessary adjunct of that function to ascertain whether allegations made are inherently improbable or inherently incredible or patently inconsistent with contemporaneous documents. Whether such an analysis ought to be undertaken depends upon the jurisdiction the Court is exercising and, more importantly, upon the particular facts of a case.

Mr Sri Dev, Counsel for the first defendant, argued that AKK-2, the letter I had reproduced in its full text, did not amount in law to an assignment of a copyright because of s. 27(3) of the Copyright Act 1987 which reads:

No assigment of copyright and no licence to do an act the doing of which is controlled by copyright shall have effect unless it is in writing.

He urged upon me that the doctrine of estoppel, relied upon heavily by the plaintiffs would not arise where a statutory provision would apply. It was his argument that nothing in the said letter indicated that the ownership of the copyright flowed with the assignment of the project. An assignment, he said, has to be in writing and be specifically referred to and he cited from various authors.

The word “assignment” referrred to in AKK-2 must in my opinion have the meaning given to it in the Concise Oxford Dictionary , i.e. “something assigned especially a task allotted to a person”. In other words, the plaintiffs through the expertise of Aw Kong Koy was assigned the task of system whilst the first defendant producing the software system whilst the first defendant reserved to himself the task of surveying. There was therefore no copyright as yet for it to be assigned.

Mr Sri Dev’s reference to s. 27(3) of the Copyright Act would seem to suggest that his client had the copyright to assign. But that is not the case.

Having reviewed the law and the facts as narrated in the copious affidavits I am of the view that the plaintiffs are entitled to the declaratory reliefs sought with costs.

Intellectual Property: MICROSOFT CORPORATION V. YONG WAI HONG COURT OF APPEAL, PUTRAJAYA

MICROSOFT CORPORATION V. YONG WAI HONGCOURT OF APPEAL, PUTRAJAYA[CIVIL APPEAL NO: W-02-1057-2003]GOPAL SRI RAM JCA, RAUS SHARIF JCA, ZAINUN ALI JCA

7 APRIL 2008

JUDGMENT

Gopal Sri Ram JCA:

[1] This appeal is directed against the order of the High Court dismissing the appellant’s summons for judgment and granting the respondent unconditional leave to defend the action. It has been said often enough that this court should dissuade appeals in cases where the judge has decided that there are triable issues of fact. In this context I would merely quote what I said in Lee Teng Siong v. Lee Kheng Lian & Ors [2006] 4 CLJ 443, a statement to which I adhere:

Now, let me say at once that it is the usual practice of this court to refuse to entertain appeals against the refusal of summary judgment. That practice was established in 1994 when this court was constituted. Once a judge has held that there are triable issues disclosed in the papers before him, we generally allow his view to prevail. For, upon such an appeal, we are only a court of review and it is not our function to trawl through the pleadings and scrutinise the affidavits to see if the judge was wrong. Once the High Court holds that there are triable issues of fact, it is best that the matter is left to proceed to the stage of case management and then on to its conclusion in the usual way. Indeed, this court is entitled to dismiss an appeal against an interlocutory order without hearing full argument unless some manifest injustice would ensue. An example of the exercise of this power is SBJ Stephenson Limited v. Mandy [1999] EWCA Civ 1720, where the English Court of Appeal dismissed an appeal against the grant of an interim injunction on the ground that it would be entirely pointless and indeed wrong for there to be a debate at the appellate stage as to whether the plaintiff in that case had a seriously arguable case justifying interim relief until trial. The court accepted that it would not be a correct use of the court’s time or cost efficient to enter into the merits of the appeal. The same applies in our jurisdiction.

[2] But this is not an ordinary case. Here, there is no bona fide dispute about the facts. In fact much of the factual substratum forms common ground or is indisputable. Here then are the facts. The appellant (plaintiff in the court below) asserts ownership of computer software programs created by its servants or agents in the United States of America. It also claims ownership over 6 trade marks, namely, “Microsoft” (in class 9 and 16), “Windows” (in class 16), its flag design, the word “Encarta” and its “Office Compatible” logo (both in class 9). The respondent was the third defendant in the court below. The first and second defendants are private limited companies. They are not before us. It is the appellant’s case that it discovered a website http://members. xoom.com/ultmm offering unauthorised copies of its computer programs for sale. It then lodged a complaint with the Ministry of Domestic Trade and Consumer Affairs which led the Enforcement Division of the Ministry to conduct three raids on 19 August 2000. The first of these was at the first defendant’s compact disc factory; the second at the first defendant’s storage facility and the third at the second defendant’s premises. In consequence of these raids, the following items were recovered from the possession of the first and second defendants:

(i) eleven stampers, each of which has the capacity to produce between 50,000 to 100,000 CD-ROMs. Of these, nine were found to contain the following computer programs belonging to the appellant:

(a) Microsoft Golf 2001

(b) Microsoft Money 2001 Standard

(c) Microsoft Windows Millennium Edition

(d) Microsoft Internet Explorer 3.02 Thai Version

(e) Memphis 1546

(f) Microsoft Visual Basic 6.0 Learning Edition

(g) Microsoft Internet Explorer 4.0

(h) Microsoft Front Page 2000

(i) Microsoft Windows NT

(j) Microsoft Internet Explorer 5.0

(k) Microsoft Windows 95

(l) Microsoft Windows 98

(m) Microsoft Windows CE Toolkit for Visual Basic

(n) Microsoft Office 95 Standard Edition – Arabic Version

(ii) thirty seven Gold Masters compact discs, each of which contained several of the appellant’s computer programs. A Gold Master is a master disc from which stampers are produced.

(iii) two hundred and ninety CD-ROMs, each containing the appellant’s computer programs.

(iv) nineteen Central Processing Units of which thirteen were found to contain the appellant’s computer programs.

(v) nine silk screens bearing several of the appellant’s registered trademarks.

(vi) a large number of CD-ROMs with label insertions bearing the appellant’s trade marks “Windows” and/or “Microsoft”.

(vii) a number of computer programs on CD-ROMs bearing several of the appellant’s trade marks were seized.

(viii) numerous job sheets detailing the replication of large amounts of computer programs, including titles belonging to the appellant were seized. These job sheets meticulously detailed, inter alia, the titles replicated, quantities, completion dates and times, the format replicated, machine numbers and operators.

(ix) six copies of Production Replication Output Reports detailing the replication of large amounts of computer programs, including titles belonging to the appellant. The reports specified inter alia the date and time of replication, the quantity ordered, whether the CDs that were produced were “good or bad” and the names of the operators of the replication machines.

[3] The following additional items were also recovered from the premises of the first and second defendants:

(i) Eight other stampers carrying various titles of the appellant’s computer programs;

(ii) Two Singulas Replication Machines; and

(iii) delivery orders for thousands of copies of various computer programs of the appellant.

A large catalogue comprising of numerous titles of the appellant’s computer programs was recovered from the second defendant’s premises.

[4] The appellant’s case against the respondent (third defendant) is this. At the material time, that is to say when the raid took place at the second defendant’s premises, a Proton Wira motorcar No JEP 4706 was found outside those premises. It was registered in the respondent’s name. In that car were found 100 CD-ROMs bearing the title of the appellant’s computer program “Office 2000 Corporate Edition SR-1 Edition”. It was later ascertained that these disks did in fact contain the appellant’s aforesaid computer program. The appellant also rests its case on the uncontradicted evidence establishing a close connection between the respondent and the second defendant in the action. The evidence comes in the form of documents recovered from the second defendant’s premises. Let me cite a few examples. First, there is an invoice from a company known as Info-Search Services addressed to the respondent in which it is stated “Being sale of the following shelf company: Esteem Region Sdn Bhd”, that is to say the second defendant in the court below. This confirms that it was the respondent who acquired the second defendant. Second, there is a quotation dated 18 July 2000 from a company known as KGP Advertising Sdn Bhd addressed to the respondent for printing more than 1000 pieces of CD covers. Third, there the copies of sales records for specific periods with the respondent’s name appearing on them. Based on these pieces of evidence the appellant claimed injunctive relief on a summons for final judgment against the respondent.

[5] The respondent’s answers to the appellant’s summons are as follows. First, he denies that the appellant is the owner of the copyright of the intellectual property in question. He adds that the appellant has not proved its ownership. Second, that he did not infringe nor was he involved in any infringement of the appellant’s intellectual property by the first and second defendants as he had no connection with either company. Third, that the appellant was guilty of delay in moving for summary judgment. Fourth, that a perpetual injunction ought not to be granted on a summons for judgment. Relying on the foregoing points as bona fide triable issues the respondent argued that he was entitled to unconditional leave to defend the action. The learned judge agreed with him and dismissed the appellant’s summons. Let me take each of the respondent’s answers in turn.

[6] As regards ownership of the copyright in the property in question, the appellant relies on s. 42 of the Copyright Act 1987 the relevant part of which provides as follows:

(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) The owner of the copyright in any works eligible for copyright under this Act stating that:

(i) at the time specified therein copyright subsisted in such work;

(ii) he or the person named therein is the owner of the copyright; and

(iii) a copy of the work annexed thereto is the true copy thereof …

shall be admissible in evidence in any proceedings under this Act and shall be prima facie evidence of the facts contained therein.

In the present case, the appellant filed an affidavit which complies with s. 42(1) of the Copyright Act. The effect of that is to provide prima facie evidence of the fact of the appellant’s ownership of the copyright over the several works in question. It was then for the respondent to offer positive evidence to displace the appellant’s prima facie ownership, for example, by showing that some other person is the true owner of the claimed copyright. But that, as has already been seen, is not what the respondent did. As such no triable issue was raised before the learned judge as to ownership of the copyright over the relevant works. As for the trade mark claim, the appellant produced the relevant certificates of registration and their renewal. By virtue of ss. 36 and 37 of the Trade Marks Act 1976 the certificates of registration establish the appellant’s ownership of the trade marks and it is for the respondent to rebut this. However, nowhere in his pleadings or written or other evidence has the respondent done this. It follows that there is no question of any doubt being cast upon the appellant’s ownership of the trade marks in question.

[7] As for the second issue – that of the respondent’s involvement – there is irrefutable documentary evidence showing that the respondent was involved with the first and second defendant companies in the making of stampers and other activity that was directed at the infringement of the appellant’s copyright. I have already adverted to the evidence that shows the respondent’s role vis a vis the second defendant. With regard to the first defendant, there is evidence that it was registered on 23 April 1996; that the respondent was appointed as on of its directors on 27 May 1999 and that all material times he held 195,000 shares in it. The respondent’s answer is that he resigned as a director and disposed of all his shares in the first defendant on 1 September 2000 and as such has no connection whatsoever with the first defendant. But it is significant: (i) that the respondent attempted to distance himself from the first defendant only some two weeks after the raid upon the latter’s premises; (ii) that his wife replaced him on the board of the first defendant; (iii) that he transferred his shareholding in the first defendant to his wife and (iv) that he divorced his wife a little while later. These acts of the respondent go to show the hollowness of the respondent’s answer to the appellant’s claim and lend support to the appellant’s assertion that the respondent was the mastermind in acts of copyright piracy against the appellant’s intellectual property.

[8] The third point raised by the respondent, namely, that the appellant had delayed in making its application for summary judgment. The relevant chronology is that the appellant delivered its statement of claim on 13 March 2001; it took out its summons for judgment on 15 June 2001, which is the date on which the respondent delivered his defence. So, the short answer is that there was no unreasonable delay. In any event, delay in moving for summary judgment is not a ground for refusing relief. In Perkapalan Shamelin Jaya Sdn Bhd & Anor v. Alpine Bulk Transport New York [1998] 1 CLJ 424 this court held that “delay can surely provide no answer to an application made under O. 14 where there are no bona fide triable issues.”

[9] The fourth ground of objection raised by the respondent – that a perpetual injunction ought not to be granted on a summons for judgment – is readily met by authority to the contrary. In Shell-Mex and BP Ltd v. Manchester Garages Ltd [1971] 1 All ER 841, Lord Denning MR took the view that a plaintiff could “go straight to the judge and ask for summary judgment under RSC O. 14 for an injunction …” Zakaria Yatim J (as he then was) acted on that authority in Fabrique Ebel Societe Anonyme v. Sykt Perniagaan Tukang Jam City Port & Ors [1989] 1 CLJ 919; [1989] 1 CLJ (Rep) 537 and in Binariang Communications Sdn Bhd v. I & P Inderawasih Jaya Sdn Bhd [2000] 3 CLJ 789, this court held that there was nothing in RHC O. 29 which prohibited the grant of a final injunction on a summons for judgment. In my judgment, based on the foregoing decisions there is no merit in the fourth ground of resistance offered by the respondent to the appellant’s summons.

[10] In the present instance the bare assertions made in his affidavit filed in opposition to the summons for judgment are insufficient to raise a triable issue warranting the grant of leave to defend. To quote Ackner LJ in Banque de Paris et Des Pays-Bas (Suisse) SA v. Costa de Naray [1984] 1 Lloyd’s Rep 21:

… the mere assertion in an affidavit of a given situation which is to be the basis of a defence does not, ipso facto, provide leave to defend; the court must look at the whole situation and ask itself whether the defendant has satisfied the court that there is a fair or reasonable probability of the defendant’s having a real or bona fide defence.

[11] There is an added factor here. The respondent’s assertions in his affidavit were contradicted by independent documentary evidence, demonstrating a want of bona fides in the points raised by him as constituting triable issues. These are matters which were plainly overlooked by the High Court when it dismissed the appellant’s summons.

[12] For the reasons already given, this appeal was unanimously allowed and judgment entered against the respondent in terms of the appellant’s summons.

[13] My learned brother Raus Sharif, JCA and my learned sister Zainun Ali, JCA have seen this judgment in draft and have expressed their agreement with it.

Intellectual Property: MCCURRY RESTAURANT (KL) SDN BHD V. MCDONALD’S CORPORATION COURT OF APPEAL, PUTRAJAYA

MCCURRY RESTAURANT (KL) SDN BHD V. MCDONALD’S CORPORATIONCOURT OF APPEAL, PUTRAJAYAGOPAL SRI RAM JCA; HELILIAH MOHD YUSOF JCA; SULONG MATJERAIE JCA

[CIVIL APPEAL NO: W-02-1037-2006]27 APRIL 2009Case History :

High Court : [2008] 9 CLJ 254

JUDGMENT

Gopal Sri Ram JCA:

[1] Let me begin with the parties to this litigation. The plaintiff (respondent before us) is a fast food franchisor. It has outlets are all over the globe. Everyone knows or has heard of “McDonalds”. There are several distinguishing marks or features about the way in which it conducts its trade. I will deal with these in a moment. The defendant (appellant before us) runs a fast food outlet. It is called “Restoran McCurry” or “McCurry Restaurant”. It offers Indian and other Malaysian cuisine. It does not serve any of the kind of food available at the plaintiff’s outlets. The plaintiff’s complaint is that the defendant has passed off the plaintiff’s business as its own. In its pleaded case it says that the defendant with full knowledge of the plaintiff’s proprietary rights in the goodwill and reputation of its trade and business in food and beverages, conducted under the distinctive “Mc” identifier, copied and adopted the identifier “Mc” for its own food and beverages restaurant. In elaboration of its claim, the plaintiff has in its written argument before us cited several examples. They are, McChicken, McMuffin, McRendang, McValue meals, McNuggets, McCrispy, McEgg, McMonday, McTwist, McWings, McSausage, McSpaceship, McTeddy Bears, McCafe, MvWatchables, McWednesday and McNews.

[2] The issue at trial was whether the defendant had passed off the plaintiff’s business as its own. The learned judge held for the plaintiff. Her decision has been challenged in this appeal. But before I deal with the arguments addressed to us, it is necessary to say a few words about the cause of action relied upon by the plaintiff. It is based on the tort of passing off.

[3] Historically speaking, the starting point in a discussion of the tort is the judgment of Lord Langdale MR in Perry v. Truefitt [1842] 49 ER 749. The Master of the Rolls formulated the tort in this way:-

A man is not to sell his own goods under the pretence that they are the goods of another man; he cannot be permitted to practice such a deception, nor, to use the means which contribute to that end. He cannot therefore be allowed to use names, marks, letters or other indicia by which he may induce purchasers to believe that the goods which he is selling are the manufacture of another person. I own it does not seem to me that a man can acquire property merely in a name or mark; but whether he has or not a property in the name or the mark, I have no doubt that another person has not a right to use that name or mark for the purposes of deception, and in order to attract to himself that course of trade, or that custom, which, without that improper act, would have flowed to the person who first used, or who was alone in the habit of using the particular name or mark.

[4] Notice that the judgment speaks of passing off the goods of another. That is because the words were uttered when the tort was in an embryonic state, with commerce and industry at very basic levels. But the common law is not static. It does not rest upon a Procrustean bed. It is organic. And flexible. It grows to meet changing conditions with dynamism. So, as the nature of trade and commerce developed, so did the tort. As persons found new ways committing “theft” of intellectual property, the common law rose to the challenge. This was indeed recognised by Lord Diplock in the leading case of Erven Warnink BV v. Townend & Sons (Hull) Ltd [1979] 2 All ER 927, who said:-

Unfair trading as a wrong actionable at the suit of other traders who thereby suffer loss of business or goodwill may take a variety of forms, to some of which separate labels have become attached in English law. Conspiracy to injure a person in his trade or business is one, slander of goods another, but the most protean is that which is generally and nowadays, perhaps misleadingly described as passing off. The forms that unfair trading takes, will, alter with the ways in which trade is carried on and business reputation and goodwill acquired. (emphasis added.)

[5] The modern re-statement of the tort is to be found in the judgment of Sir Thomas Bingham MR in Tattinger SA v. Allbev Ltd [1993] FSR 641:-

But it is now, as I understand, clear that the defendant need not, to be liable, misrepresent his goods to be those of the Plaintiff if he misrepresents his goods or his business as being in some way connected or associated with the Plaintiff’s.

[6] Learned counsel on both sides referred to the ingredients of the tort. They said that the tort comprises of five elements, all of which must be present for its proof. These are as follows:-

(i) There must be a misrepresentation by the defendant;

(ii) It must be made in the course of trade;

(iii) It must be made to prospective or ultimate customers;

(iv) It must be calculated to injure the goodwill and reputation of the plaintiff;

(v) The plaintiff must suffer resultant damage.

Learned counsel for the plaintiff relied on the decision in Erven Warnink in support of his submission.

[7] Learned counsel for the defendant referred us to Reckitt & Colman Products Ltd v. Borden Inc. [1990] 1 All ER 873, in particular to the speech of Lord Oliver when making his submission on the ingredients of the tort. This is what Lord Oliver said:-

The law of passing off can be summarised in one short general proposition, no man may pass off his goods as those of another. More specifically, it may be expressed in terms of the elements which the Plaintiff in such an action has to prove in order to succeed. These are three in number. First, he must establish a goodwill or reputation attached to the goods or services which he supplies in the mind of the purchasing public by association with the identifying ‘get up’ (whether it consists simply of a brand name or a trade description, or the individual features of labelling or packaging) under which his particular goods or services are offered to the public, such that the get-up is recognised by the public as distinctive specifically of the plaintiff’s goods or services. Second, he must demonstrate a misrepresentation by the defendant to the public (whether or not intentional) leading or likely to lead the public to believe that goods or services offered by him are the goods or services of the Plaintiff. Whether the public is aware of the plaintiff’s identity as the manufacturer or supplier of the goods or services is immaterial, as long as they are identified with a particular source which is in fact the plaintiff. For example, if the public is accustomed to rely on a particular brand name in purchasing goods of a particular description, it matters not at all that there is little or no public awareness of the identity of the proprietor of the brand name. Third, he must demonstrate that he suffers or, in a quia timet action, that he is likely to suffer damage by reason of the erroneous belief engendered by the defendant’s misrepresentation that the source of the defendant’s goods or services is the same as the source of those offered by the Plaintiff.

[8] With great respect to the learned Law Lords whose speeches were read to us, I find myself in the unfortunate position of entertaining a view that differs from theirs. In my judgment, since passing off is a common law wrong, it is idle to speak of the ingredients of the tort in strict terms as though it was a creation of some penal statute. It is not. At the risk of repetition, it is a product of the genius of the common law. But, that said, the elements referred to in the two cases already cited are certainly the essential features of the tort in the sense in which it has always been understood. Put shortly, a defendant is liable if he injures the plaintiff by either passing off his goods or mark or business as that of the plaintiff’s. And to pass off one as the other certainly involves the creation of a false impression which is referred to as the element of misrepresentation in the tort. For my part, I am content to rely upon and be guided by the following passage in the judgment of Mohamed Azmi J (later FCJ) in Mun Loong Co Sdn Bhd v. Chai Tuck Kin [1982] CLJ 80; [1982] CLJ (Rep) 590:-

At common law, it is an actionable tort for one person to represent his business to be that of another, or to mislead the public into believing that it is, because the person guilty of the deception thereby profits illegitimately from the goodwill which attaches to the other business. The commonest means by which this deception is practised is by the adoption of a business name which is calculated to cause the public to confuse the spurious business with the genuine one. If the spurious business is conducted by a company incorporated with a name likely to cause such confusion, the owner of the genuine business may obtain an injunction to restrain the company from trading in its own name or even continuing to have its own name. If the injunction takes the latter form, the company must either change its name or be wound up.

[9] That brings me to the question argued at length before us as to whether there exists the “extended tort of passing off”. We were regaled with authorities on both sides in support of their rival submissions. It is clear that the defendant apprehends the point of origin of the so-called extended tort to be the speech of Lord Fraser of Tullybelton in Erven Warnink. It is the defendant’s submission that Lord Fraser had held that the tort of passing off could be established without proof of a misrepresentation and that this was not the law. According to the defendant, the plaintiff succeeded in the court below on this extended form of the tort without having pleaded it. This is a point I will deal with in a moment. But I must first deal with the defendant’s complaint that Lord Fraser was wrong in holding that a plaintiff could succeed without proof of misrepresentation when what is at issue is injury to goodwill.

[10] Now, here is what that learned Law Lord said:-

It is essential for the plaintiff in a passing-off action to show at least the following facts: (1) that his business consists of, or includes, selling in England a class of goods to which the particular trade name applies; (2) that the class of goods is clearly defined, and that in the minds of the public, or a section of the public, in England, the trade name distinguishes that class from other similar goods; (3) that because of the reputation of the goods there is goodwill attached to the name; (4) that he, the plaintiff, as a member of the class of those who sell the goods, is the owner of goodwill in England which is of substantial value; (5) that he has suffered, or is really likely to suffer, substantial damage to his property in the goodwill by reason of the defendants selling goods which are falsely described by the trade name to which the goodwill is attached.

[11] I have read and re-read the speech of Lord Fraser and nowhere do I find in it any pronouncement dispensing with the proof of the element of misrepresentation. Indeed, it is manifestly clear from the passage above quoted that the misrepresentation by the defendant of his goods or business as that of the plaintiff’s is an essential element of the tort. This is clear from the phrase “falsely described”. It is elementary that to falsely describe is to misrepresent. I am therefore inclined to agree with the submission of counsel for the plaintiff that the so-called extended tort is nothing more than the common law adapting the tort of passing off to new and different circumstances. And, as for the pleading point, there is really nothing in it at all. In the first place the plaintiff has in its statement of claim pleaded all the facts that go to constitute the elements of the tort. In the second place, whether the plaintiff may rely on the so called extended form of the tort is a question of law and it is well settled that you do not have to plead law.

[12] I come now to what I consider to be the nub of the case. It is whether the learned judge judicially appreciated the evidence before her in holding that the defendant had committed the tort against the plaintiff. From the way in which the plaintiff ran its case in the court below and when responding to the appeal, the only point that survives is whether the use by the defendant of the word “McCurry” amounts to a passing off by it of the plaintiff’s trade name to which goodwill is attached. Put differently, the question is: Did the defendant represent his business to be that of the plaintiff? Having scrutinised the evidence presented to the learned trial judge, I have come to the conclusion that the question must receive a negative response. And I will explain why.

[13] First, you have to look at the plaintiff’s mark or get-up or logo – call it what you will – as a whole and not merely one element in it. The plaintiff’s get-up consists of a distinctive golden arched “M” with the word “McDonalds” against a red background. The defendant’s signboard carries the words “Restoran McCurry” with the lettering in white and grey on a red background with a picture of a chicken giving a double thumbs up and with the wording “Malaysian Chicken Curry”. Thus, the defendant’s presentation of its business is in a style and get up which is distinctively different from that of the plaintiff. Second, as I have already said, the items of food available at the plaintiff’s outlets all carry the prefix “Mc”. However, as evident from the defendant’s menu card none of the food items served carries the prefix Mc. This is an important consideration. Third, it is beyond dispute that the type of food available at the plaintiff’s outlets is very different from that served at the defendant’s sole outlet. The latter caters only typically Indian food whereas the former serves fast food. This is an important point in the defendant’s favour. The learned trial judge in her judgment appears to have been influenced by the decision of the Hearing Officer in the United Kingdom Trade Mark Registry, in the Matter of Application no. 1412458 by Sabbir Mehta, Osman Mehta, Imtiaz Ahmed Mulla and Hanif Patel to Register the mark McIndian. There, the Hearing Officer found for McDonalds on the ground that McIndian could be confusingly similar to the McDonald’s family of marks all employing the prefix “Mc”. However, what the learned trial judge in the present instance appears to have overlooked is the fact that McIndian not only sold Indian food, but also Southern fried chicken, cheeseburgers, French fries and shakes which are the very items that McDonalds also sell. This point is well brought out by the Singapore Court of Appeal in McDonald’s Corp v. Future Enterprises Pte Ltd [2005] 1 SLR 177 when distinguishing the McIndian case from Yuen Yu Kwan Frank v. McDonald’s Corporation [2001] WL 1422899 where the court disregarded the objection of McDonald’s and allowed the registration of the mark “McChina”. In my judgment, the learned judge’s omission to distinguish the facts of the McIndian case from the present instance constitutes a serious misdirection which has resulted in a miscarriage of justice. The fourth, point I would make is this. There is evidence to show that the type of customers who patronise the defendant’s outlet is very different from those who patronise the plaintiff’s several outlets. The former are in the main adults and senior citizens while the latter are mainly children. In my judgment the irresistible inference to be drawn from the totality of the evidence is that the defendant’s signboard would not result in reasonable persons associating McCurry with the plaintiff’s mark. The one is a typically Indian restaurant selling Indian and local dishes with just its one outlet while the other is a multinational vendor of fast food such as burgers, French fries and milkshakes.

[14] In the course of her judgment the learned judge made the following observations on which comment is necessary:-

[56] When ‘Mc’ is used in conjunction with a food item, the first impression or the first thing that comes to mind is McDonald’s and the plaintiff. Any unauthorized use of the prefix ‘Mc’ could also lead to the conclusion that the products sold and the services offered with reference to the said prefix are an extension of the plaintiff’s family of mark consequently creating an association with the plaintiff.

[57] Customers familiar with the McDonald’s trade mark and corporate signage and the products found in the McDonald’s outlets would only logically assume that ‘Mc’ in McCurry restaurant is associated in some way to the plaintiff or is an extension of the plaintiff’s current range of products and services. It is also not a coincidence that the defendant would have picked the font and colour scheme on its signage without referring to the signage and repute of the plaintiff. I am of the view that this shows that the defendant seeks to obtain an unfair advantage from the usage of the prefix.

[15] In the first place, the learned judge’s finding is postulated on the fact that the defendant used the prefix “Mc” – to quote her – “is used in conjunction with a food item”. But the facts show that the defendant did not use the prefix “Mc” in conjunction with a food item. Indeed, as I have already said, the food items the defendant offers its customers are wholly different from those offered by the plaintiff. Where the learned judge, with respect, erred is to assume that the respondent had a monopoly in the use of the prefix “Mc” on a signage or in the conduct of business. If in Yuen Yu Kwan Frank v. McDonald’s Corporation a restaurant could carry on a restaurant named “McChina” selling only Chinese food, it is a little difficult to fathom the logic of restraining the instant appellant from selling only Indian food under the signage “McCurry”. Given the totality of the circumstances of this case, the finding by the learned judge that the continued use by the appellant of the signage “McCurry” would – again to quote her – “lead to the conclusion that the products sold and the services offered with reference to the said prefix are an extension of the plaintiff’s family of mark consequently creating an association with the plaintiff” is a serious misdirection on the facts.

[16] With regard to the finding of the learned judge at para 57 of her judgment (above quoted), the fact that the defendant chose the name “McCurry” cannot by itself lead to the inference that it sought to obtain an unfair advantage from the usage of the prefix “Mc”. It would have been different if the defendant had offered to its customers items that were labelled either the same as or similar to those sold by the plaintiff, for example, Mcfish or Mclamb. But that is not what the defendant did. Accordingly, it is my considered judgment that the learned judge misdirected herself on the proper inferences to be drawn from proved and admitted facts.

[17] In my judgment, a reasonable tribunal armed with the facts and evidence that was presented to the learned judge would have held for the defendant and against the plaintiff. This is because there was, in my respectful view, no proof of the tort of passing off in this case. And there was no judicial appreciation of the most important pieces of the evidence presented at trial.

[18] For the reasons already given, I would allow the appeal and reverse the findings of the learned judge. The plaintiff’s claim is dismissed. The costs of this appeal and those incurred in the court below shall be borne by the plaintiff. The deposit shall be refunded to the defendant.

[19] My learned sister Heliliah bt Mohd Yusof and my learned brother Sulong Matjeraie, JJCA have seen this judgment in draft and have expressed their agreement with it.

[2009] 1 LNS 309

Intellectual Property: PHILIP MORRIS PRODUCTS SA V. ONG KIEN HOE & ORS HIGH COURT MALAYA, KUALA LUMPUR

PHILIP MORRIS PRODUCTS SA V. ONG KIEN HOE & ORSHIGH COURT MALAYA, KUALA LUMPURMARY LIM JC[SUIT NO: D5(IP)-21-78-2002]22 MAY 2009

JUDGMENT

Mary Lim JC:

[1] The plaintiff who started this claim against three defendants finally went to trial only against one, the 2^nd defendant. Along the way, the claims against the 1^st and 3^rd defendants were withdrawn. At the trial, the plaintiff withdrew several reliefs sought, namely paras 42.3, 42.4, 42.7, 42.15, 42.16 and 42.18 in the statement of claim.

[2] The plaintiff’s claim against the 2^nd defendant is basically one of infringement of the plaintiff’s trade and proprietary rights over the registered trade mark of “Marlboro”. The plaintiff has set out a factual matrix and explained a peculiar modus operandi upon which it claims the 2^nd defendant has infringed or has been involved in a conspiracy to injure the plaintiff’s registered trade mark and of unlawful interference with the conduct of the plaintiff’s trade. It is the plaintiff’s case that the evidence reflects a much involved 2^nd defendant. The infringement is said to have been committed by the 2^nd defendant by passing off or attempting to pass off counterfeit cigarettes:

a. by its action in the transshipment, loading, unloading, reloading, transloading, storing, transitional storing, transiting, transporting, transshipping, transferring and/or dealing in any other manner in the course of trade with the counterfeit cigarettes without the consent, licence, authorization or knowledge of the plaintiff

b. without the consent, authorization or knowledge of the plaintiff dealt in or with the counterfeit cigarettes and/or counseled, instigated, procured, enabled, directed or assisted in the doing of those same acts.

[3] The plaintiff further alleged that the 2^nd defendant has directly or indirectly abetted the commission within or outside Malaysia which constituted acts of infringement, manufacturing and of applying false trade description and/or of supplying or offer to supply the counterfeit cigarettes under a false trade description. The 2^nd defendant is also alleged to have shown its direct complicity with the counterfeit cigarettes not only with regard to the importation and customs clearance but also in claiming ownership to obtain release and delivery of the counterfeit cigarettes to itself.

[4] In response, the 2^nd defendant’s defence is that it was merely carrying out its duties and obligations as a forwarding agent for a named principal and is therefore innocent of the allegations made. The 2^nd defendant denied responsibility or liability for the infringement. The 2^nd defendant further pleaded that the counterfeit cigarettes in the two containers were within the free zone. Since these cigarettes were in transit and were not being imported into the country these cigarettes were not subjected to import duties and to Malaysian laws. The seizure by the 3^rd defendant was therefore wrong. The 2^nd defendant made an unsuccessful attempt to bring the 3^rd defendant in as a third party. An appeal is currently pending before the Court of Appeal on this. The issue is whether the 2^nd defendant is liable for infringement of the plaintiff’s goods in the manner pleaded by the plaintiff.

Background Facts

[5] The plaintiff, a subsidiary of Philip Morris Companies Inc, manufactures, distributes and sells cigarettes and tobacco products under the trade mark of “Marlboro” throughout the world. The plaintiff registered that trade mark in Malaysia under Class 34 together with eight other trade marks. These trade marks are still valid and subsisting. This is an undisputed fact.

[6] On or about 10 September 2002, the officers of the 3^rd defendant (Director General of the Customs & Excise Department) detained two containers. The 3^rd defendant had detected irregularities pertaining to the identities of the consignors, volumes and quantities declared in the relevant forms filed with the 3^rd defendant. An inspection revealed these two containers contained 1350 unmarked bale boxes concealed in plastic gunny bags. These boxes in turn contained cigarettes bearing the trade mark of “Marlboro”.

[7] These cigarettes were subsequently examined by PW1, a product specialist of the plaintiff who confirmed that these cigarettes were not genuine “Marlboro” cigarettes, packaged or manufactured by or under authority or control of the plaintiff. In other words it was found that these cigarettes were counterfeit cigarettes. This is not really challenged by the 2^nd defendant.

[8] According to the declaration forms completed by the 2^nd defendant and filed with the 3^rd defendant, the consignors of the two containers were the 1^st defendant, a sole proprietor and one Kean Huat Sdn Bhd, both businesses registered in Malaysia, while the consignees were Dordrecht Aalst of Guido Gezellelaan 64, 9100 Sint. Niklaas, Belgium and Ernest BV BA, Van Dijckkai No 21, Bus 5, 2052, Antwerpen, Belgium. The contents of the two containers were declared as cigarettes and paper bags shipped by the 1^st defendant and Kean Huat Sdn Bhd respectively. A company and business search revealed that both consignees in Belgium were fictitious. A similar search conducted with the Companies Commission of Malaysia (CCM) disclosed that Kean Huat Sdn Bhd was not registered and was therefore a fictitious company. That being the case, no claim was made against this company. Insofar as the 1^st defendant is concerned a search revealed that while the company exists the address declared in the declaration forms was fictitious. The declaration forms, packing and shipping of the goods in the containers were arranged by the 2^nd defendant, whose business is that of multi-modelism (door-to-door freight forwarding service). When the containers were opened by the 3^rd defendant’s officers, the counterfeit cigarettes were found and the counterfeit cigarettes seized by the 3^rd defendant.

Infringement

[9] With the registration of Marlboro as a trade mark under the Trade Marks Act 1976 (Act 175), the plaintiff secures certain rights. Most importantly, as the registered proprietor of the trade mark the plaintiff has the exclusive right under s. 35 of Act 175 to the use of this trade mark in relation to cigarettes. Pursuant to s. 35, the fact that the plaintiff is registered as proprietor of the trade mark is prima facie evidence of the validity of the original registration of the trade mark and of all subsequent assignments and transmissions thereof.

[10]Section 38 of Act 175 provides for how an infringement may arise:

38. (1) A registered trade mark is infringed by a person who, not being the registered proprietor of the trade mark or registered user of the trade mark using by way of permitted use, uses a mark which is identical with it or so nearly resembling it as is likely to deceive or cause confusion in the course of trade in relation to goods or services in respect of which the trade mark is registered in such a manner as to render the use of the mark likely to be taken either:

(a) as being use as a trade mark;

[11] In Tohtonku Sdn Bhd v. Superace (M) Sdn Bhd [1992] 2 CLJ 1153; [1992] 1 CLJ Rep 344 the Supreme Court held that a registered trade mark is infringed when a person uses a mark that is identical with the registered trade mark; so nearly resembling that registered trade mark as is likely to deceive; or so nearly resembles the registered trade mark as likely to cause confusion.

[12] In Parker-Knoll Limited v. Knoll International [1962] RFC 265 @ 273 Lord Denning differentiated between “to deceive” and “to cause confusion”:

Secondly “to deceive” is one thing. To “cause confusion” is another. The difference is this: When you deceive a man, you tell him a lie. You make a false representation to him and thereby cause him to believe a thing to be true which is false. You may not do it knowingly, or intentionally, but you still do it, and so you deceive him. But you may cause confusion without telling him a lie at all, and without making any false representation to him. You may indeed tell him the truth, the whole truth and nothing but the truth, but still you may cause confusion in his mind, not by any fault of yours, but because he has not the knowledge or ability to distinguish it from the other pieces of truth known to him or because he may not even take the trouble to do so.

[13] It is clear from this explanation that it is immaterial whether the 2^nd defendant has intention or knowledge of the infringement. See also Acushnet Company v. Metro Golf Manufacturing Sdn Bhd [2006] 7 CLJ 557. Similarly, in Upmann v. Forester [1883] Ch 231 the defendant imported 5000 cigars in boxes bearing a spurious trademark. The defendant claimed he was not aware of any infringement of the plaintiffs’ right until he was served with the writ, and that he never intended to sell or distribute the boxes. Despite that, the court found the defendant liable. At p. 237 Chitty, J said: ” … Although the defendant’s misfortune that the boxes should bear a spurious trade-mark, yet, according to the authorities, he must be held to have committed a clear infringement of the plaintiff’s right sufficient to entitle the plaintiffs to an injunction for the purpose of this action. The infringement of a patent and of a trademark may be treated on the same footing, the question being one and the same, namely, whether the right of exclusive user has been infringed. In the case of Adair v. Young the question was whether the master of a ship fitted up with pumps; which were an infringement of letters patent, was liable for the infringement, although he had nothing to do with putting the pumps on board, and had never used the pumps in British waters. It was held in the Court of Appeal that he was so liable, the ground of the decision being not that he had used the pumps in the sense of having put them in active use, but that the fact of the pumps being upon the ship constituted sufficient evidence of an intention to use them, and the court held that an injunction granted in the court below must be sustained.” The importation of the spurious articles would amount to an infringement and the defendant remains liable regardless of his intention towards the spurious articles. Innocence is therefore not a defence to an infringement of registered trade mark.

Findings

[14] There is no doubt that the trade mark on the cigarettes seized from the two containers bear a trade mark identical to the registered trade mark of the plaintiff. Since the plaintiff has not authorized or licensed the 2^nd defendant to use that registered trade mark there is infringement.

[15] Relying on Rovak v. National Trade Press [1955] 72 RPC 110 learned counsel for the 2^nd defendant submitted that it cannot be liable because the 2^nd defendant had not used the trade mark in the course of trade in the cigarettes for which the cigarettes were registered and as envisaged under s. 38. Its trade is only of a forwarding agent. In Rovak the question was whether the publishers of a directory called the “Branded Merchandise and Trade Marks Directory” who had erroneously published S. Aronsohn Ld. as the registered proprietors of the trade mark “Weatherite” in relation to weatherproof clothing and sports wear, had thereby infringed the trade mark belonging to the plaintiff. The court answered that question in the negative. In coming to that determination, the court had to consider whether the publication in the directory was a use in the course of trade. At p. 111 the court said:

As I have said, there is no authority that assists me in this matter; but it does seem to me that the governing words in these cases are “in the course of trade”, and in the course “of trade” means … in the course of trade in those goods. If I take the first part of the section as it stands alone … I cannot see that the fact that a person has improperly said, in a directory or other publication, that A.B. is the proprietor of a trade mark is a “use” of the trade mark by that person who has made the statement. If he had been authorized by that person to make that statement it would be a “use” by that person; but I cannot see it as a “use” of a trade mark by the person who has made the incorrect statement. He is not applying it to goods himself; he is not dealing with goods, and he is certainly not “using” it “in the course of trade” and “in relation to those goods”. He is using it in the course of his own trade which is that of a publisher or a trade directory; and although the words in section 4(1)(a), taken by themselves, give some colour to the argument which has been put before me by the Plaintiffs, I think it all comes back to the question as to what is a “use” under this section. I think that the publication does not amount to a “use”; and, although I am far from saying there may not be a remedy, the remedy of infringement under the Act, which has been chosen in this case, is not appropriate and I do not think it comes within the words of the Act.

[16] However this decision is not appropriate for several reasons. Section 4 of the English Trade Marks Act 1938 in that case is not in pari materia with s. 38 of Act 238. The section contains a deeming operative and the case concerns the application of s. 4(1)(b) while the facts of this case concerns s. 38(1)(a).

[17] In the instant case, the 2^nd defendant has been in the business of freight forwarding since 1994. It receives goods that have been packed and arranges for their onward shipment to the destinations of the consignees according to the instructions of the consignors. The details of the consignment are set out in the appropriate declaration forms completed and filed with the 3^rd defendant. All this was carried out by the 2^nd defendant in the course of its trade. The consignment is only ever opened when there is a request by the customer to repack or consolidate in any manner as instructed. Otherwise the consignment remains sealed.

[18] This was the evidence given by DW1, a director of the 2^nd defendant in relation to the shipping arrangements for the counterfeit cigarettes. According to her, she was approached by a person called Frankie via telephone. Frankie enquired about a shipment of cigarettes from Singapore for Europe that will transit in Malaysia in the Free Zone area. She then meets up with Frankie at Hotel Nikko. Upon her advice, Frankie provided the shipper’s commercial invoice together with the shipping manifest naming a local company that will clear the cigarettes. Using details from the manifest and the commercial invoice the 2^nd defendant prepared Form ZB1. This form is required by the Free Zone Authorities to clear goods into the Free Zone. On 20 July 2002, the cigarettes arrived in a container. After clearing them with the Free Zone Authorities the 2^nd defendant unstuffed the cigarettes by taking them out as it is and storing the cigarettes in a warehouse at West Port as instructed by Frankie. A month later DW1 was again approached by Frankie for another consignment of cigarettes also for transshipment into and out of the Free Zone to Europe. This shipment arrived and once again after clearing with the authorities the 2^nd defendant removed the cigarettes from the container and packed them into an outgoing container that was shipping out on 4 September 2002. On 7 September 2002 DW1 met Frankie for the third time. This time the 2^nd defendant was to transship paper bags due to arrive at West Port on 9 September 2002. The 2^nd defendant was to take out the cartons of paper bags and consolidate (pack together) them with the two earlier consignments of cigarettes still in storage at a warehouse in West Port. The 2^nd defendant carried out these instructions. After mixing the contents of these consignments, the result was two containers – no. HDMU4280534 and HDMU4125190 both containing cigarettes and paper bags and bound for export to Belgium. These two containers were the very same containers detained by the 3^rd defendant for irregularities in declaration forms. The cigarettes found in these containers were counterfeit cigarettes.

[19] From the evidence presented and from the thrust of the plaintiff’s case it is the entirety of the factual matrix and the modus operandi which needs to be weighed in making the evaluation of whether there is a case as pleaded. It is indeed true that the common law is frequently tested against new circumstances in the tort of passing off or other associated wrongs related to intellectual property appear. In the recent decision of McCurry Restaurant (KL) Sdn Bhd v. McDonalds Corporation (Civil Appeal No. W-02-1037-2006) after tracing the law of passing off to the case of Perry v. Truefitt [1842] 49 ER 749 the Court of Appeal said:

Notice that the judgment of passing off the goods of another. That is because the words were uttered when the tort was in an embryonic state, with commerce and industry at very basic levels. But the common law is not static. It does not rest upon a Procrustean bed. It is organic. And flexible. It grows to meet changing conditions with dynamism. So, as the nature of trade and commerce developed, so did the tort. As persons found new ways of committing “theft” of intellectual property, the common law rose to the challenge. This was indeed recognized by Lord Diplock in the leading case of Erven Warnick BV v. Townend & Sons (Hull) Ltd [1978] 2 AII ER 927, who said:

Unfair trading as a wrong actionable at the suit of other traders who thereby suffer loss of business or goodwill may take a variety of forms, to some of which separate labels have become attached in English law. Conspiracy to injure a person in his trade or business is one, slander of goods another, but the most protean is that which is generally and nowadays, perhaps, misleadingly described as passing off. The forms that unfair trading takes, will, alter with the ways in which trade is carried on and business reputation and goodwill acquired. (Emphasis added)

The modern restatement of the tort is to be found in the judgment of Sir Thomas Bingham MR in Tattinger SA v. Allbev Ltd [1993] FSR 641:

But it is now, as I understand, clear that the defendant need not, to be liable, misrepresent his goods to be those of the plaintiff if he misrepresents his goods or his business as being in some way connected or associated with the plaintiff’s.

[20] Upon examining the evidence of the 2^nd defendant, I do not find the 2^nd defendant as a mere forwarding agent. On the facts, the 2^nd defendant did a lot more.

[21] Firstly, the whole process from documentation to the handling of the cigarettes or the consignment is part and parcel of the course of the 2^nd defendant’s trade or business as a forwarding expert. The 2^nd defendant’s use is not as a private consumer. The documentation work related to the clearance of the cigarettes was an integral part of the expertise and trade of the 2^nd defendant. It is the 2^nd defendant who represented to others including the 3^rd defendant that the goods in the two containers were cigarettes. Obviously these cigarettes must have a brand or be of a particular make, whatever that may be. The fact that the contents of the two containers cleared the Free Zone Authorities indicates that these Authorities must have believed that the 2^nd defendant was authorized or licensed to “use” in the sense of handling the cigarettes and clearing them in the course of its trade as a forwarding agent.

[22] Secondly, the 2^nd defendant unstuffed counterfeit cigarettes and later consolidated these cigarettes with the other consignment of counterfeit cigarettes and paper bags. This required the 2^nd defendant to open up the containers and deal with their contents. Although there is no need for the 2^nd defendant to know for a fact that these cigarettes bore some particular registered trade mark, it is naive to suggest that the 2^nd defendant is not aware at that time that it is handling cigarettes bearing the trade mark “Marlboro”. Having been in the forwarding business for almost 15 years it is fair to impute that the 2^nd defendant is at least generally aware of trade marks and counterfeiting or infringements of trade marks. Having opened the containers to consolidate their contents the trade mark must have been obviously displayed.

[23] Next, the use of fictitious names and addresses admitted by the 2^nd defendant indicates the existence of some element of complicity. Given that 133(1) Customs Act 1967 (Act 235) makes it an offence to inter alia make a declaration which is untrue or incorrect in any particular, I agree with the submissions of learned counsel for the plaintiff that the evidence of DW1 and DW2 that the 2^nd defendant is not obliged to ensure accuracy of the particulars in the documents presented for clearance of the cigarettes to be unsustainable both in law and on the facts. On the contrary, ss. 80 and 90 mandate the 2^nd defendant with certain duties and liabilities for ensuring the completeness and accuracy of the details of the goods declared.

[24] In Upmann v. Elkan [1871] 7 Ch App 130 the court rejected the submission that a carrier being a mere carrier cannot be liable. According to Lord Hatherley LC:

It has been argued that the Plaintiffs were not entitled to an injunction against the Defendants, who had been guilty of no offence, being merely carriers receiving goods, which, though fraudulently marked, were not for their own use, nor to be sold by them for their own benefit, but were received merely for the purpose of transmitting them to the persons to whom they were consigned.

I cannot conceive a doctrine more dangerous or mischievous, or more fatal to the authority of the Court with respect to trade-marks. If that argument prevailed, any persons being abroad, as was the case in this instance, and minded to commit frauds upon the English trade-mark, could easily do so by sending their different consignments together to persons in the position of the Defendants, who appear to be respectable agents and warehousemen, thereby committing an injury in a manner most convenient for themselves, and very mischievous to the person entitled to the benefit of the trade-marks.

[25] Further, and this is significant – the plaintiff held itself out as the owner of the counterfeit cigarettes within the context of Act 235 when claiming for their return from the 3^rd defendant. Section 128(2) allows “any person asserting that he is the owner of such goods or the proceeds of sale of such goods, as the case may be, and that they are not liable to forfeiture may give written notice to a senior officer of customs that he claims the same”. Section 2 defines an “owner” in respect of goods to include any person “holding himself out to be the owner, importer, exporter, consignee, agent or person in possession of, or beneficially interested in, or having any control of, or power of disposition over, the goods.” Section 40(2) Free Zones Act 1990 (Act 438) also provides for return of goods seized within the Free Zone. Section 40(2) reads: “Any person asserting that he is the owner of such goods and that they are not liable to forfeiture may personally or by his agent authorise in writing give written notice to a senior officer of customs that he claims the same.”

[26] Though this claim was subsequently abandoned, it is indicative of how the 2^nd defendant perceived its role in the whole transaction. I find that the evidence presented reveal active participation of the 2^nd defendant. It would indeed be mischievous and dangerous to allow the 2^nd defendant to now retreat into his role play as a passive forwarding agent. In any event, the infringed goods were used in the course of trade of the 2^nd defendant and his lack of knowledge or intention of the infringement is irrelevant. Under the circumstances, there has been infringement of the plaintiff’s trade mark by the 2^nd defendant.

Free Zone

[27] A related issue raised by the 2^nd defendant concerns the jurisdiction where the cigarettes were seized. The contention of the 2^nd defendant is that the counterfeit cigarettes were seized within the Free Zone. The submission here is that the Free Zone is deemed to be a place outside Malaysia. According to s. 1A of the Customs Act 1967 and ss. 2 and 50 and item 5 in Schedule 10 of the Free Zones Act 1990 (Act 438), a Free Zone is a place outside Malaysia. That being so, not only is there no levy within this zone, the laws in Malaysia including the Trade Marks Act 1967 do not apply. Learned counsel for the 2^nd defendant submitted that ‘goods in transit’ are also exempted from seizure.

[28] Having read the relevant provisions of the law, I respectfully disagree with learned counsel for the 2^nd defendant. The purpose for the establishment of Free Zones is clearly set out in the long title to the Free Zones Act – “… for promoting the economic life of the country and for related purposes”. As part of the efforts towards promoting economic life, s. 4 of the Act provides that except for those specifically and absolutely prohibited by law, goods or services of any description may be brought into, produced, manufactured or provided in a Free Zone without payment of any customs duty, excise duty, sales tax or service tax. Where the goods fulfilled the conditions set under the Act, the goods are exempted from these payments. But that does not mean that the Free Zone is a free for all area, free of all laws or, that there is lawlessness in this zone. The enforcement agencies continue to hold jurisdiction over and in these Free Zones. This is evident from ss. 18, 21, 23, 24 and 26 of Act 438 and the provisions of Parts XI and XII of Act 235. In any event the issue of the validity of the seizure is immaterial and irrelevant to the success or otherwise of the plaintiff’s claim. The plaintiff’s rights in the registered trade mark are rights in rem.

[29] Finally on quantum. PW1 has given evidence of the street value and explained how the value of loss is calculated. This has not been seriously challenged by the 2^nd defendant.

[30] Having therefore given due and serious consideration to the submissions and authorities of both learned counsel and in particular the oral and written evidence adduced, I find that the plaintiff has proved its case on a balance of probabilities. Accordingly, I allow the plaintiff’s claim with costs.

[2009] 1 LNS 498

Intellectual Property: ONESTOP SOFTWARE SOLUTIONS (M) SDN BHD & ANOR V. MASTERITEC SDN BHD & 2 ORS HIGH COURT [KUALA LUMPUR]

ONESTOP SOFTWARE SOLUTIONS (M) SDN BHD & ANOR V. MASTERITEC SDN BHD & 2 ORSHIGH COURT [KUALA LUMPUR]RAMLY HAJI ALI, JSUIT NO: D5(IP)-22-1828-20084 FEBRUARY 2009

IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR

(COMMERCIAL DIVISION)

SUIT NO: D5(IP)-22-1828-2008

BETWEEN

1.	ONESTOP SOFTWARE SOLUTIONS (M) S DN BHD (Company Reg No: 556337-A)	… PLAINTIFFS
2.	QNE SOFTWARE SDN BHD (Formerly ONESTOP SOFTWARE SOLUTIONS (KEDAH) SDN BHD) (Company Reg No: 611852-V)
AND
1.	MASTERITEC SDN BHD (Company Reg No: 666843-H)	… DEFENDANTS
2.	CHIN TAT LIM (NRIC No: 770111-10-5317)
3.	MOK CHEE HOE (NRIC No: 720501-08-5440)

CORUMDATUK RAMLY HAJI ALI (JUDGE) HIGH COURT KUALA LUMPUR (COMMERCIAL DIVISION)

GROUNDS OF JUDGMENT

(Enclosure 3)

1. Enclosure 3 is an application by the Plaintiff for an interlocutory injunction prohibiting the Defendants from infringing the 2nd Plaintiff’s copyright in the QnE Software.

2. The Plaintiff’s claim against the Defendants are as follows:-

(a) infringement of the 2nd Plaintiff’s copyright in the QnE Software;

(b) breach of duty of confidentiality to the Plaintiffs;

(c) breach of the employment agreement by the 2nd Defendant;

(d) breach of fiduciary duty by the 3rd Defendant.

3. The principles governing the grant of an interlocutory injunction were laid down by Lord Diplock in the House of Lords in the case of American Cyanamid v. Ethicon Ltd [1975] AC 396. To summarise those principles, the party seeking the injunction must establish the followings:-

(a) there are serious issues to be tried;

(b) damages will not be an adequate compensation; and

(c) balance of convenience favours the grant of the injunction.

The above principles have been adopted by the Court of Appeal in Keet Gerald Francis v. Mohd. Noor @ Harun bin Abdullah & 2 Ors. [1995] 1 CLJ 293. The Plaintiff must satisfy the Court that its claims are not frivolous or vexatious.

Infringement of the 2nd Plaintiff’s Copyright in the QnE Software

4. The Plaintiff’s QnE Software is an accounting software specially designed for use by a person with minimal accounting background. The objective of the QnE Software is to bypass the in depth knowledge required to manage the financial affairs of a business and the day to day financial administration and reporting of a business. In the QnE Software, the Plaintiff’s assert the following features which are protected under copyright:-

(a) the computer program comprising the literal elements being the source codes;

(b) the computer program comprising the non-literal elements being the structure, modularity, architecture and design features of the QnE Software; and

(c) the user interface of the program (what appears on the screen display when the program is run).

5. Computer program is protected as a literary work under the Copyright Act 1987. Under Section 3 of the Copyright Act 1987, “literary work” includes “computer program”. The case of Creative Propose Sdn Bhd & Anor v. Integrated Trans corp Sdn Bhd & Ors. [1997] 2 CLJ SUPP 107; [1997] 2 MLJ 429 (at page 437) affirms that a computer program is a literary work. It comprises source codes which are literary works. A computer program also comprises non-literal elements which are protected under the law.

6. The English cases are instructive on the issue of copyright protection and infringement of computer programs as our laws are similar. In the English case of Ibcos Computers v. Barclays Mercantile [1994] FSR 275, the High Court held that copyright protection extends to both the source codes of a computer program as well as the underlying structure of a computer program. In Ibcos Computers, Jacob J held at page 302 that:-

“I thoroughly agree with what Ferris J (in the John Richardson case) want on to say: “Consideration is not restricted to the text of the code …” That must be right: most literary copyright works involve both literal matters (the exact words of a novel or a computer program) and varying levels of abstraction (plot, more or less details of a novel, general structure of a computer program).”

“I therefore think it right to have regard in this case not only to what Mr Turner (the Plaintiffs’ expert) called ‘literal similarities’ but also to what he called ‘program structure’ and ‘design features’.”

7. In respect of the user interface and the design of screen display of a computer program, they are protected as “artistic works” under our Copyright Act 1987. Section 3 of the Act defines “artistic work” as including “a graphic work, photograph, irrespective of the artistic quality.”

8. In the present case the Plaintiff has shown prima facie proof of ownership and subsistence of copyright. The Plaintiffs’ affirmed in paragraph 13 of the Plaintiffs’ First Affidavit facts which are required to be in compliance with Section 42 of the Copyright Act 1987. These facts are namely that:-

(a) copyright subsists in the literary and artistic works of the QnE Software;

(b) copyright subsists in the QnE Software at all material times after the first publication of the QnE Software on or around 2001 (in the original version and all subsequent revisions thereof);

(c) the 2nd Plaintiff is the owner of the copyright; and

(d) copies of the QnE Software are annexed in the Statutory Declaration in Exhibit “SML-6″ of the Plaintiffs’ First Affidavit.

9.Section 42 of the Act provides that an affidavit made in accordance with the provisions of subsection 1 of the section shall be admissible in any proceedings under the Act and shall be prima facie evidence of the facts contained therein. None of the facts affirmed by the Plaintiffs were challenged or rebutted by the Defendants in their affidavits. The subsistence and ownership of the Plaintiffs’ copyright in the QnE Software is therefore proved.

Computer Software and Injunction – Issues to be determined for grant of injunction

10. In comparing 2 computer programs, where a Defendant has manifestly copied but denied any copying, the proper inference is that similarities not explained by independent evidence are due to copying and not to his programming style. (per. Jacob J. in Ibcos Computer case – supra, at page 303 and 304).

11. Applying the above principle, the Court finds that the Defendants have failed to explain the various similarities between the Plaintiffs’ QnE Software and the Infringing Masteritec Software. The few attempts made by the Defendants to explain the similarities, ie, based on accounting conventions or as features common to such accounting software, have been rebutted by the Plaintiffs in their affidavits. In fact, the Plaintiffs have gone to great length to demonstrate to the Court why these features that were copied by the Defendants are unique to the Plaintiffs and how several competing products in the market differ from the Plaintiffs’.

12. The threshold is to satisfy that there is a serious issue which had to be fully canvassed and tried, ie, whether there is copyright infringement of the software. The Court in Federal Computer Services Sdn Bhd v. Eric Ang Jee Hai [1991] 4 CLJ 511 (Rep); [1991] 3 CLJ 2667:-

“It was very clear to us that the controversial nature of the competing expert evidence was such that it was quite impossible in an interlocutory proceeding to form any confident finding of fact; indeed, in this case the tasks of the trial Judge before whom evidence will be given orally by the experts will be a very difficult one in view of the technical nature of those evidence.”

13. In the both cases Federal Computer Services (supra) and Missing Link Software v. Magee [1989] 1 FSR 361 the outcome of the expert evidence was inconclusive to the decision of the judge whether to grant injunction. The principle to be taken from these cases is that as long as there is conflicting evidence on the issues of copyright infringement, the case raises a serious issue to be tried.

14. For purposes of the interlocutory injunction in the present case, the Plaintiffs adduced evidence through the founder and main developer of the QnE Software, Mr Sam Mun Long, and he has highlighted the features in the QnE Software which have been copied. These similarities coupled with the Defendants’ access to the Plaintiffs’ QnE Software and the short time in which their infringing Masteritec Software was commercially launched, would certainly raise serious issues to be tried.

15. There are objective similarities between the Masteritec Software and the QnE Software, which are not adequately explained by the Defendants. There is a strong causal connection between the Masteritiec Software and the QnE Software due to the Second Defendant’s access to the source codes of the Plaintiffs’ whilst under his employment. Under such circumstances the similarities between the software can only arise due to the copying of the QnE Software by the Defendants. The Plaintiffs’ therefore have a strong case for copyright infringement against the Defendants.

Breach of Duty of Confidentiality to the Plaintiffs

16. In Coco v. Clark [1969] RPC 41 at page 47, Megarry J discussed at length the elements that constitute confidential information. Accordingly, something that has been constructed solely from materials in the public domain may possess the necessary quality of confidentially but there must be some product of the human brain which suffices to confer a confidential nature upon the information.

17. In addition, Lord Greene, Master of Rolls opined in the case of Saltman Engineering Co. Ltd v. Campbell Engineering Co. Ltd [1948] Court of Appeal 65 RPC 203 at page 215 that “It is perfectly possible to have a confidential document, be it a formula, a plan, a sketch, or something of that kind”.

18. The Plaintiff’s Proprietary Information includes technical information, source codes, sequencing as well as business secrets, including trade channels especially the distribution and resellers network, customer database as well as price and cost lists for their products which from part of the Plaintiffs’ trade secret. Applying the dicta of Coco v. Clark and Saltman Engineering above, it is clear that the Plaintiffs’ Proprietary Information is confidential in nature.

19. The information must have been communicated in circumstances importing an obligation of confidence, VC George J in Regent Decorators (M) Sdn. Bhd. v. Michael Chee Keng Theng [1984] 2 CLJ 441 (Rep); [1984] 2 CLJ 296 applied the case of Saltman Engineering in deciding at page 446:-

“As to the contention that such information that the Defendants (who were ex-employees) had was in fact gathered by them from material which was available to anybody, if such gathering of the information took place while the Defendants were in the employ of the Plaintiffs and in the course of such employment then if could very well be that the use of what was thus gathered without the consent of the Plaintiffs, would be an infringement of their rights.”

20. In the present case, the 2nd Defendant was an ex-employee of the Plaintiff while the 3rd Defendant was an ex-auditor. It is a well known principle that auditors, like any professionals in discharging their duties, owe a fiduciary duty to the company not to misuse confidential information which came to their knowledge in the course of their work. This principle is stated in the text book Professional Liability in Singapore and Malaysia, Accountants and Auditors by Kala Anandarajah at page 83:-

“The auditor should not put himself in a position of conflict. For example, where he makes secret profits or acquires interests and benefits by improperly using confidential information about the company’s business.”

Further, at page 85, the learned author states that the general rule is that an auditor owes a duty of confidentiality at common law. This duty arguably arises as a consequence of the nature of the fiduciary relationship that exists between the auditor and his client.

21. The Plaintiffs have taken great length to protect their Proprietary Information, including having express clauses and undertaking of non-disclosure regarding confidentiality in their agreements with employees. The 2nd Defendant ought to know, after signing an agreement expressly enunciating non-disclosure of Proprietary Information that the information communicated to him in the course of his employment and work is confidential in nature. The 2nd Defendant was fully aware of his obligations after signing the employment agreement and undertaking of non-disclosure.

22. The 3rd Defendant as auditor of the 1st Plaintiff should not have used the confidential information for the benefit of the 1st Defendant and to the detriment of the Plaintiffs.

23. The 2nd Defendant has used/disclosed the Plaintiffs’ Proprietary Information, whilst still under the employment of the 1st Plaintiff and continues to do so after the termination of their employment with the 1st Plaintiff, despite signing an agreement with express undertakings as to confidentiality. The 3rd Defendant has also used/disclosed the Plaintiff’s Proprietary Information which he had obtained as auditor of the 1st Plaintiff.

24. The 2nd and 3rd Defendants have via the 1st Defendant sold the Masteritec Software through identical trade channels, using identical means as the Plaintiffs.

25. The Defendants did not challenge the Plaintiffs’ right to protect their Proprietary Information. The Defendants have merely given a bare denial. The Defendants’ failure to rebut the Plaintiffs’ assertions of a right in the Plaintiffs’ Proprietary Information is deemed to be an admission thereof. Likewise, the Defendants have not satisfactorily rebutted the misappropriation and use of the Plaintiffs’ Proprietary Information. There are thus serious issues to be tried.

26. There is also an issue that the 2nd Defendant has been alleged to have breached the terms of the Employment Agreement, especially the express terms regarding non-disclosure of Proprietary Information which survives the termination of the agreement. There is an indication of a breach of the agreement as the 2nd Defendant developed and sold the Infringing Masteritec Software almost immediately after leaving the employment of the 1st Plaintiff. The production of the Infringing Masteritec Software is a direct result of the alleged unlawful use of the Plaintiffs’ Proprietary Information in breach of his terms of employment, especially the confidentiality clauses which survives termination. These are issues to be tried.

26. The 3rd Defendant is an auditor to the Plaintiff. In the leading case of Prince Jefri Bolkiah v. KPMG (a firm) [1999] 1 All ER 517 the House of Lords held at page 518 that “like a solicitor, an accountant providing litigation support services owed a continuing professional duty to a former client following the termination of the client relationship to preserve the confidentiality of information imparted during the subsistence of that relationship. That duty is unqualified and required the accountant to keep the information confidential, not merely to take all reasonable steps to do so, and also not to misuse it.”

28. The 3rd Defendant who worked as an auditor of the 1st Plaintiff from 2002 to 2005 had access to the 1st Plaintiff’s financial records, invoices, sales records, client records and other Proprietary Information. The 3rd Defendant is a shareholder of the 1st Defendant company and acted in concert with the 2nd Defendant to set up the 1st Defendant. The fact that the Masteritec Software is substantially similar to the QnE Software, that both software are sold through similar trade channels and distributors is a direct result of the 3rd Defendant’s alleged breach of fiduciary duty.

29. There are serious issues to be triad as the Plaintiffs have strong and legitimate claims against the Defendants in respect of copyright infringement, breach of confidentiality and breach of employment contract and breach of fiduciary duty, as discussed above.

Damages – Inadequate remedy

30. An injunction should be granted when damages are inadequate remedy and Plaintiffs are in a financial position to pay the Defendant.

31. The Plaintiffs submit that damages will be inadequate compensation from the Defendants should they win at trial. The reason damages will be inadequate compensation fro the Plaintiff are as follows:-

(a) the Plaintiffs will suffer a permanent diversion of business, unfair appropriation of their labour, skill and effort in developing, designing and producing the QnE Software and damage to reputation due to Defendants’ wrongful acts;

(b) disclosure of Proprietary Information by the Defendants will not adequately be compensated by damages alone. Loss of goodwill, market share and business is irreparable and cannot be restored at the end of a long trial;

(c) once a customer acquires a particular business financial software, it is unlikely that they will switch to another competitor’s software as there world have been substantial investment in both time and money. Thus, the loss of business and custom to the Plaintiffs is one of a permanent and irreparable nature;

(d) the Plaintiffs are denied their right to control exploitation and use of their copyright in the QnE Software and are denied the attribution and recognition in their ownership of the copyright in the QnE Software; and

(e) the 1st Defendant is operating on a small scale business out of the home of the 2nd Defendant and are not in the financial position to make good any compensation to the Plaintiff. The Defendants have not demonstrated to Court any ability to pay damages that may be ordered against them and the Plaintiffs are very likely to end up obtaining a paper judgment at the end of the trial. As seen from the company report at Exhibit “SML-3″, the 1st Defendant is making a loss as at the year ending 2006.

32. The reason damages will adequately compensate the Defendants are as follows:-

(a) the 2nd and 3rd Defendants are not prohibited from working in their field of choice. So long as the products of the Defendants do not utilize the Plaintiffs’ Proprietary Information, do not breach their contractual agreement regarding confidentiality and do not infringe the Plaintiff’s copyright, the Defendants are at liberty to develop, market and sell competing software. They must not do in an unfair manner, and unlawfully and unjustly using the Plaintiffs’ intellectual property as a springboard to develop theirs; and

(b) the Defendants have just begun business and there is relatively little loss of market share and business.

Balance of Convenience

33. The balance of convenience favours the grant of the interlocutory injunction on the following basis:-

(a) the Plaintiffs, particularly the 2nd Plaintiff is a MSC status company, which have come up through years of investment in time, money and effort. As the QnE Software is a good product, it has enjoyed increasing recognition, and sales of the same have been encouraging and are on the rise. The Plaintiffs took many years to develop the QnE Software and spent a lot of time and effort promoting the same but all these will be destroyed if the Defendants were allowed to openly sell and market their infringing Masteritec Software;

(b) the Plaintiffs currently employ up to 24 employees and the QnE Software is the Plaintiffs’ main and only product. With the Defendants’ infringing Masteritec Software continue to be offered for sale and sold in the market at a lower price but offering the same if not similar interface and systems, there is a real possibility that the Plaintiffs’ business will be severely impacted. The Plaintiffs may not be able to sustain the growth of their business and may also be forced to scale down. This will be very unfortunate particularly as the 2nd Plaintiff is an up and coming MSC company;

(c) on the contrary, the 1st Defendant is a business operating from the 2nd Defendant’s residence and does not employ many employees, if at all;

(d) the Defendants have not adduced a single shred of evidence to show their ability to pay damages and compensate the Plaintiffs in the event they win at trial;

(e) the 1st Defendant continues to sell the Infringing Masteritec Software despite notice from the Plaintiff’s solicitors to the 1st Defendant in flagrant infringement of the 2nd Plaintiff’s copyright. There is no intention of the Defendants to stop their infringing acts unless restrained by the Court;

(f) as production and/or sale of the Infringing Masteritec Software is continuing, the Plaintiffs continue to suffer irreparable damage due to the free-riding of the Defendants on the Plaintiffs’ labour, skill and effort;

(g) as a result of not having to expend the required time, labour and effort on the development of the Infringing Masteritec Software, the 1st Defendant is able to offer the Infringing Masteritec Software at a cheaper price than the QnE Software, which creates unfair competition between the Plaintiffs and the 1st Defendant to the continued detriment of the Plaintiffs’ business. The Plaintiffs are not able to match the price of the Masteritec Software thus demotivating and affecting the productivity of the Plaintiffs’ employees and also resellers; and

(h) previously, the Plaintiffs were able to command a good price for their products and maintain a reasonably good profit margin due to the unique features present in and developed by Plaintiffs in the QnE Software, which set apart the Plaintiffs’ software from the other legitimate competitors. However the Infringing Masteritec Software has copied these very unique features of the QnE software and the Defendants having access and knowledge of the Plaintiffs’ pricing and distribution channel, have offered the Masteritec Software at a lower price, as such greatly affecting the Plaintiffs’ profit and business.

Undertaking as to damages

34. The Plaintiffs have undertaken to pay damages in this application to the Defendants. The Plaintiffs have no difficulty in paying damages to the Defendants in the event the injunction order is set aside or the Defendants ultimately succeed at trial.

Defendants’ Notice to produce

35. The Defendants’ filed a notice to produce documents referred to in the affidavit and pleadings pursuant to Order 24 rule 10 of the RHC 1980 on 24.11.2008 and served it on the Plaintiffs on 25.11.2008. The Defendants’ requested for production of the following documents:-

(a) source codes, referred to in paragraph 14.1.1 of the statement of claim; and

(b) the Demo CD referred to in “Exhibit SML-49″ of the Plaintiffs’ Second Affidavit.

36. The Plaintiffs’ replied on 28.11.2008 with an objection to produce the documents requested. The reasons for the objection to produce are as follows:-

(a) the QnE Software is the copyrighted work of the 2nd Plaintiff. The Defendants should not have a copy of the confidential source codes of the QnE Software as the Defendants are competitors of the Plaintiffs. One of the subject matters of the injunction is the copying of the QnE Software by the Defendants and to allow the Defendants to inspect the Plaintiffs’ source codes at this stage is very prejudicial to the Plaintiffs; and

(b) the QnE Software source codes are the proprietary rights of the Plaintiffs which contain Proprietary information which is classified. The Proprietary Information is a result of the substantial efforts of the Plaintiffs in money and time developed and accumulated through many years. The source codes are very valuable to the Plaintiffs and the Plaintiffs’ business. The source codes are not accessible from public sources or information.

Principles of Discovery

37. The general principle for an order of discovery is enunciated in the case of Yekambaran s/o Marimuthu v. Malayawata Steel Berhad [1994] 2 CLJ 581 where Edgar Joseph Jr. J said at page 585:-

“The essential elements for an order of discovery are threefold: namely first there must be a “document”. Secondly, the document must be “relevant” and thirdly, the document must be or have been in the “possession, custody or power” of the party against whom the order for discovery is sought… As to “relevance”, our Rules of the High Court limit discovery to documents which are “relevant to” or “relate” to the factual issues in dispute.”

38. The Court will adopt the same principle applied in the case of Syarikat Ying Mui Sdn Bhd v. Yeh Ying Sdn Bhd [2003] 8 CLJ 741, which is a case concerning a request for discovery at an interlocutory stage by the Defendant decided by this Court at page 748:-

“As in all other civil suits, it is the Plaintiff’s burden to prove its case on the balance of probabilities, during the full trial of the suit. It is only during full trial that the Plaintiff must call its witnesses and adduce all other relevant evidence in order to prove its case on the balance of probabilities.”

The Court continued:-

“…. the Court is satisfied that the Defendant’s application (for discovery) is in reality an application for the Plaintiff to show proof at an early stage of the proceedings and tantamounts to a fishing expedition and an abuse of process of the Court especially in light of the following:-

The “proof” of which the Defendants seek from the Plaintiff can only be properly elicited during pre-trial case management or discovery or during the course of full trial;”

39. With regard to the production of the Plaintiffs’ source codes in the QnE Software, the Court finds that at this juncture, such production is premature. The issue whether there has been actual copying of the source codes, and if so, which part of the QnE Software, including the source codes, has been copied, is for determination at full trial.

40. The Plaintiffs’ application is for an interlocutory injunction. The Plaintiffs have adduced sufficient evidence as exhibited in the Plaintiffs’ affidavits to show that the Defendants’ have copied substantially from the Plaintiffs’ QnE Software. There is no need for reference to source codes at this juncture. Furthermore, copying of source codes is only one aspect of infringement of the copyright in the Plaintiffs’ computer program. There are the non-literal elements of the QnE Software which have been copied, which evidence of copying can be seen from the various objective similarities already highlighted and affirmed in the Plaintiffs’ affidavits.

41. It is neither expedient nor necessary at this stage to delve into the disclosure of source codes, since source codes are not easily understood by laymen and would need an expert to analyse. Further delay will be caused to the Plaintiffs’ application if time is taken to analyse the source codes. As such, the request by the Defendant is a delay tactic as well as a fishing expedition early in the proceedings.

42. The onus of proof for interlocutory injunction by the Plaintiff is to establish that there are serious issues to be tried, as discussed above. The Plaintiffs through their affidavits have illustrated that there are serious issues to be tried, and as long as the burden of proof is satisfied, it is not necessary for an order of discovery to produce the source codes and the demo CD.

43. The better way of approaching the issue of source code copying is to have an expert look at both the Plaintiffs’ source codes for the QnE Software and the Defendants’ infringing Masteritec Software during the discovery process and render a report on the same. However, this is a step taken to prove or disprove a party’s case at trial. At the interlocutory injunction stage, such a requirement is unnecessary and defeats the urgency of an injunction being disposed of expeditiously.

Conclusion

44. Based on the above considerations, the Court rules that the Plaintiffs’ application for an interlocutory injunction is allowed with costs; and the Defendants application for discovery is dismissed.

Intellectual Property: SAPURA HOLDINGS SDN BHD & ANOR V. NORTHERN TELECOM (ASIA) LIMITED & 2 ORS HIGH COURT [KUALA LUMPUR]

SAPURA HOLDINGS SDN BHD & ANOR V. NORTHERN TELECOM (ASIA) LIMITED & 2 ORSHIGH COURT [KUALA LUMPUR]HADHARIAH SYED ISMAIL, JCSUIT NO: D1-22-436-199413 SEPTEMBER 2009Case History :

High Court : [1996] 2 CLJ 118

IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR

(COMMERCIAL DIVISION)

SUIT NO: D1-22-436-1994

BETWEEN

1. SAPURA HOLDINGS SDN BHD	… PLAINTIFFS
2. SAPURA TELETECH SOLUTIONS SDN BHD
AND
1. NORTHERN TELECOM (ASIA) LIMITED	… DEFENDANTS
2. NORTHERN TELECOM INTERNATIONAL LTD
3. NORTHERN TELECOM LIMITED

GROUNDS OF JUDGMENT

The 1st Plaintiff’s group of companies including the 2nd Plaintiff, specialize in the manufacturing, marketing, distributing, exporting, installing and servicing telecommunications equipment. The 3rd Defendant is the manufacturer of Private Automatic Branch Exchange, commonly known as PABX system. The 1st Defendant was incorporated by the 3rd Defendant to market the products of the 2nd Defendant in Asia. The 2nd Defendant is the international trading arm of the 3rd Defendant. From 1979 to 1994, the Plaintiffs were the Malaysian distributor of PABX System, manufactured by the 3rd Defendant. On 20.4.1994, the Defendant sent a letter to the Plaintiff notifying of its decision not to renew the distributorship agreement for 1994. The Plaintiffs allege that the act of the Defendant in not renewing the agreement tantamount to a breach of contract and unlawful. As a result of the termination, the Plaintiffs have suffered losses and damages. Vide this suit, the Plaintiffs pray for the following:-

(a) Special damages in the sum of RM21,439,000.00;

(b) General damages;

(c) Punitive and exemplary damages;

(d) A declaration that the Defendants wrongfully, unlawfully, unjustly and unconscionably failed to renew the Plaintiffs’ contract with the Defendants;

(e) Interest at such rate and from such date as this court may deem just and expedient;

(f) Other relief this court may deem just and expedient.

Relationship Between The Parties

The Executive Chairman in the Sapura, Tan Sri Dato’ Sri Ir Shamsudin bin Abdul Kadir (PW1) gave evidence on how the relationship between the parties begin. His evidence can be summarized as follow. Prior to 1979, Northern Telecom (NT) products, particularly known as PABX system were distributed in Malaysia solely by Electroscon Sdn Bhd, a company owned by Dato’ Hj Mokhtar bin Mohidin, a colleague of PW1. In 1979, a person by the name of Ben Beneteau, Chief Executive of the 2nd and 3rd Defendant approached PW1 and requested him to take over distributorship of NT products from Electroscon Sdn Bhd. In paragraph 5.3.1 to 5.3.9 of the statement of claim, it was pleaded that in the said negotiations, Ben Beneteau had made the following representations:-

5.3.1. The 3rd defendant’s choice of the 1st plaintiff was based on the 1st plaintiff’s past and continuing performance in the telecommunication field in Malaysia, and on the in house resources that were readily available to the 1st Plaintiff;

5.3.2. The initial marketing of the PABX System and the matters attendant thereto including a commitment to service and maintain the system would be slow and in the process, the 1st Plaintiff would suffer losses;

5.3.3. That Malaysia offered tremendous growth potential for the PABX System. The market would eventually prove to be highly profitable and the losses absorbed by the 1st Plaintiff in the initial years could be reversed and the 1st Plaintiff would be able to reap sizeable and substantial benefits;

5.3.4. All the defendants would make available to the Plaintiffs all the assistance and back-up required in the Plaintiff’s endeavour to market the PABX System;

5.3.5. All the Defendants would also make available an agency to the Plaintiffs in respect of the PABX System and the various other NT products;

5.3.6. The 1st Plaintiff and the 3rd Defendant should enter into a long term commercial relationship in the telecommunication field which would be commercially beneficial to both parties;

5.3.7. That the services of the Plaintiffs would be required to market the PABX System on a long term basis with provisions for automatic renewals;

5.3.8. That to instill confidence amongst the purchasers and to establish a reputation for the PABX System, the Plaintiffs should hold spare parts for at least a period of five years of supply;

5.3.9. The Plaintiffs past record and reputation will also instill confidence amongst the prospective purchasers that the PABX System supplied was a quality product and that the same would be serviced and maintained effectively.

At first, PW1 was reluctant to take over the distributorship. He states the reasons why he was not keen as:-

(i) Electroscon was owned by his friend and he did want any animosity or unhealthy competition.

(ii) Taking distributorship of a product like PABX system require a long term commitment.

(iii) The capital investment are quite high.

(iv) The returns are uncertain and unpredictable.

But Ben Beneteau insisted. To make PW1 accept the distributorship, Ben Beneteau pledged that the entire in house resources NT has as manufacturer of the product would be readily made available to the Plaintiff. He was specifically informed by Ben Beneteau that NT was not interested in a one off transaction but was looking for a long term relationship with Sapura to take on the market in partnership. PW1 was persuaded. Plaintiffs were officially appointed as the sole distributor for NT products in Malaysia. It is clear then that the deciding factor which led PW1 agreeing to enter into the relationship with NT is his conversation with Ben Beneteau and his belief in what Ben Beneteau had said. He did not confirm the oral agreement with Ben Beneteau in writing because in his own word “We in the top echelon of the business rely on oral undertakings and we do not question the sincerity of the other side.

It is a fact that there was no written agreement for the distributorship from 1979 to 1984. To PW1, the relationship between the parties is not as purchaser and vendor. He categorically said that he would not have agreed to be a distributor of the PABX system if there would be an agreement in writing which is valid for one year because the life span of the products is more than a year and it would have been suicidal for the Plaintiff to have gone into a venture of this nature.

Relationship From 1979-1984

PW1 described the relationship between the parties as a true partnership. Defendants had products to offer. Plaintiffs had the personnel to find the market for the products and the Defendants helped the Plaintiffs whenever there were manufacturer’s defects or Plaintiffs required assistance.

The Agreements

In 1984, Uniphone Sdn Bhd, a wholly owned subsidiary of the 1st Plaintiff was distributing NT products. After 5 years of relationship, a written agreement was introduced. Plaintiffs was told not to worry because the 2nd Defendant only need to standardize their affairs with various distributors but the relationship with the Plaintiff would continue unchanged. For ease of reference, the agreements entered into between the parties are listed in the table below.

Written Agreements

Date	Page	Document	Parties	Period
31.12.81	1-30	License Agreement	Northern Telecom Ltd and Uniphone Sdn Bhd	5/10 years
31.12.81	31-43	Supply Agreement	Northern Telecom Ltd and Uniphone Sdn Bhd	10 years
01.09.82	44-48	Amending Agreement	Northern Telecom Ltd and Uniphone Sdn Bhd	N/A
02.01.84	49-60	Distributorship Agreement	Northern Telecom (Asia) Ltd and Uniphone Sdn Bhd	02.01.84-03.01.85
02.01.85	61-89	Distributorship Agreement	Northern Telecom (Asia) Ltd and Sapura Holdings Sdn Bhd	02.01.85-03.01.87
19.07.85	90-96	Repair Agreement (Distributor)	Northern Telecom International Ltd and Sapura Holdings Sdn Bhd	19.07.85 – termination of DA 1985
04.01.87	97-106	Distributorship Agreement	Northern Telecom (Asia) Ltd and Sapura Holdings Sdn Bhd	04.01.87-31.12.89
04.01.87	107-114	Software License Agreement	Northern Telecom (Asia) Ltd and Sapura Holdings Sdn Bhd	04.01.87-termination of DA 1987
01.11.90	115-117	Renewal & Amending Agreement	Northern Telecom (Asia) Ltd and Sapura Holdings Sdn Bhd	DA 1984 renewed from 01.01.91-31.12.92
31.12.92	474	Letter from D1 to P2	Note: unsigned	DA renewed from 01.01.93-31.12.93

As can be seen, the first distributorship agreement is dated 2.1.1984.The relevant clauses in the agreement referred to by counsel for the Defendants to PW1 are clause 2, 3, 17 and 19. These clauses state as follows:-

2. Northern Telecom hereby grants to Distributor, who accepts, the non-exclusive right to distribute and sell the Products in the territory to customers other than those excluded by Appendix “A”.

3. This Agreement shall commence on execution and expire on 3rd January, 1985 unless sooner terminated, subject, however, to extension as may be agreed in writing by both parties not later than sixty (60) days prior to the expiry of the term.

17. This Agreement shall neither constitute Distributor an agent, nor authorize it to deal in the name of Northern Telecom, nor create any relationship between the parties other than that of seller and buyer.

19. This Agreement with Appendices constitutes the entire Agreement between the parties with respect to the subject matter hereof. All prior agreements and understandings related thereto are hereby cancelled. This agreement may not be amended except by a written document signed by both parties.

It is pertinent to note that subsequent distributorship agreement between the parties also contained similar clauses. On being shown the above clauses, PW1 agreed that his oral testimony is inconsistent with the content of the clauses. He also agree that the parties relationship with regard to products, repair, software products and every facet of their relationship were regulated in writing. Despite all that, PW1 maintains his answer that he hold to the oral agreement he made with Mr Ben.

The 1984 Agreement was renewed by another written agreement dated 2.1.1985 (the 1985 Agreement) and entered into between the 2nd Defendant and the 1st Plaintiff. The terms and conditions of the 1985 Agreement was, in substance, the same as the 1984 Agreement.

Upon the expiry of the 1985 Agreement, by effluxion of time, the same was renewed by an agreement in writing dated 4.1.1987 and entered into between the 1st Defendant and the 1st Plaintiff (the 1987 Agreement).

Unlike the 1984 or the 1985 Agreements, the 1987 Agreement was not renewed but both the Plaintiffs and the Defendants conducted their affairs and their business transactions in accordance with the said representations and the past conduct.

By an agreement entitled “Renewal And Amending Agreement” dated 1.11.1990 and entered into between the 1st Defendant and the 1st Plaintiff (the 1990 Agreement), the 1987 Agreement was purportedly renewed. But the 1990 Agreement was only forwarded to the 1st Plaintiff by the 1st Defendant by a letter dated 24.2.1992 and never executed.

By a letter dated 31.12.1992, the 1st Defendant renewed the 1990 Agreement which was expiring by effluxion of time on 31.12.1992, for a period of one year from 1.1.1993 to 31.12.1993.

By a letter dated 17.2.1994, the 1st Defendant informed the 2nd Plaintiff that the Plaintiff’s renewal agreements were currently being processed by their Corporate Legal Department.

How Business Was Conducted

It is an undisputed fact that the Plaintiffs need to maintain stocks and sufficient spare parts for at least five (5) years supply to render effective service to the end user. This is also the Plaintiffs commitment to Jabatan Telekom Malaysia to support potential customers for five years. The manner in which both parties conducted their business is described by PW3 as follows. The relationship is far more than as a distributor. He gives an example by referring to Licence Agreement dated 31.12.1981, Supply Agreement dated 31.12.1981 and Amending Agreement dated 1.9.1982 between 2nd Defendant and 3rd Defendant and Uniphone Sdn Bhd, whereby the 3rd Defendant granted Uniphone Sdn Bhd a licence and patent rights to manufacture and market some of their main Distributing Frame Equipment in Malaysia, India, Bangladesh, Pakistan, Bhutan, Burma, Cambodia, Laos, Nepal, Sri Lanka, Vietnam and Afghanistan. In the words of PW2, this scenario indicates there was a lot of trust between the Plaintiffs and the Defendants to the extent the Defendants shared their intellectual property with the Plaintiffs. Another example given by PW2 is the Defendants willingness to train the Plaintiff’s personnel in the repair of advanced new equipment without having any pre-condition as to the confidentiality or trade secrecy. Having perused the notes of proceedings, it is obvious that the parties happily conduct their business without strict adherence to the terms of the agreement.

Further Inducement

Evidence was led by PW2 that sometime in or about September 1992, there was a series of meetings between the officers of the Plaintiffs and the Defendants. In the course of the meetings, one Row Zadher, the then General Manager of ASEAN and Australasia, an officer of the 1st Defendant represented, in the presence of PW2, to Shahril Shamsuddin, the Group Managing Director of the 1st Plaintiff that:-

(a) The time has matured for the upturn in the market for the PABX System;

(b) To enhance the image of the PABX System and to reap benefits, the 2nd Plaintiff should change its name from Premier Communications and Engineering Sdn Bhd to include the name “Sapura” to enable the 2nd Plaintiff to be readily identified with the Sapura Group of Companies.

(c) To further enhance the image of the 2nd Plaintiff as an entity of its own and a successful company of the Sapura Group, the 1st Plaintiff should do the following to project a sales and service image more compatible with the Defendant’s product line:-

(i) The 2nd Plaintiff should move and upgrade its premises;

(ii) A new repair centre should be constructed with the requisite equipment; and

(iii) Enhance and improve the service division and to prepare it to render fast, effective and quality service.

Acted on trust and good faith in the truth of the representations made by the Defendants, the 1st Plaintiff implement the following:-

(a) The change of its name from the former name of Premier Communications & Engineering Sdn Bhd to Sapura Teletech Solutions Sdn Bhd;

(b) Recruited and enlisted 25 qualified new staff to increase the support staff from 67 to 92 employees thereby incurring an additional annual wages of RM793,486.83;

(c) Constructed a new repair centre at a cost of RM111,029.00 totally dedicated to the Defendants’ products;

(d) Sent selected staff to learn advance servicing techniques at a cost of RM293,243.00;

(e) Incurred expenditures for advertising and promotional exercises in the sum of RM279,501.00;

(f) Caused the 2nd Plaintiff to move and upgrade its premises thereby incurring renovation and moving expenses amounting to RM 279,809.50;

(g) Opened new service centres in Batu Pahat, Petaling Jaya, Ipoh, Penang, Miri and Kuala Lumpur.

The Breach

The incident which led to the termination of the Plaintiff’s distributorship agreement is this. In or about 1992, the Plaintiffs identified Hyatt Hotel in Johor Bahru as a potential customer for the PABX System and the same was communicated to the Defendants so that a joint strategy could be worked out. However, to the Plaintiffs surprise, the 1st Defendant authorised and assisted one Folec Communications (Singapore) Pte Ltd (Folec Singapore) to submit a proposal for this project using the same equipment as the 2nd Plaintiff had proposed to use.

It is PW2′s further evidence that the Defendant had appointed Folec Malaysia sometime in December 1993 to take over the local market for PABX System. The appointment of Folec Malaysia was not indicated to the Plaintiffs prior to the non-renewal of the Distributorship Agreement with the Plaintiffs. Neither did the Plaintiffs receive any notice or indication that the Distributorship Agreement would not be renewed.

In fact when PW2 attended a meeting between the Plaintiffs and the Defendants on 26th August 1993, he specifically asked the Defendants why the Distributorship Agreement for 1993 was yet to be signed, he was assured not only that the 1993 Agreement would be signed but Agreement for 1994 would also be renewed. The 2nd Plaintiff had even write to the Defendants by their letter dated 3.2.1994 asking the Defendant to honour their promise. Such request was ignored and rejected by the Defendant.

Termination

In a meeting held on 19th April 1994 amongst the officers of the Plaintiffs and the Defendants, one Craig London (DW3), the Managing Director of the 2nd Defendant indicated that the Plaintiffs’ agreement with the Defendants will not be renewed. The Plaintiffs were notified in writing of the termination by a fax transmission dated 20th April 1994.

The Plaintiffs contend that the non renewal tantamount to termination and is unreasonable, unfair, unlawful and wrongful and in breach of the collateral and other agreements. In the alternative, the Plaintiffs contend that such termination is in breach of the fiduciary and other duties the Defendants owe to the Plaintiffs as co-venturer.

In the alternative, the Plaintiffs contend that the Defendants are stopped both in law and in fact from terminating the agreement.

Losses And Damages Suffered

By reason of the matters above mentioned, the Plaintiffs have suffered and continues to suffer losses and damages.

Particulars of Special Damages

(a)	Actual amount invested	-	RM9,680,000.00
(b)	Loss of future profits	-	to be assessed
(c)	Termination benefits payable to 92 staff	-	RM554,583.02
(d)	Stock in hand of NT Products and PABX spares	-	RM5,004,000.00
(e)	Loss of gross profits on pending tenders plus maintenance contracts for 1994	-	RM6,200,000.00

Issues To Be Tried

Both parties have formulated the issues to be determined by this court as follows:

1. Whether by reason of conduct and the mode and manner in which the parties hereto dealt with each other, the parties treated the Plaintiffs as one and the same entity, and the Defendants as one and the same entity.

2. Whether the relationship between the 1st Plaintiff and the 3rd Defendant was

(a) That of co-venturers [in the enterprise of marketing, distributing and servicing the said NT Products (as defined in the Pleadings)] or

(b) That of vendor and purchaser where the purchaser also acted as distributor [in the enterprise of marketing, distributing and servicing the said NT Products (as defined in the Pleadings)].

3. Whether there was a collateral agreement in place between the parties or whether the terms of the agreement were contained entirely within written agreements which superseded all prior agreements. If there was a collateral agreement, what were the terms of the same.

4. Whether the non-renewal of the said agreement was tantamount to a termination of the same. If so, whether that termination was lawful, fair and reasonable.

5. If the termination was unlawful, unfair and unreasonable, what is the measure of damages payable to the Plaintiffs as per the pleadings.

Despite the numerous issues listed, I was of the opinion that the primary issue to be determined is whether the termination was unlawful, unfair and unreasonable.

The Court’s Approach

In this case the court was asked to determine essentially what are the true relationship between the Plaintiffs and the Defendants. Are their relationship as buyer-seller or distributor or joint venturer? The Plaintiffs’ pleaded case is they are co – venturer. My task would be to interpret the facts and determine the true nature of the bargain in substance. To do that, I will deal first with the issue of oral representations made by Mr Ben Beneteau.

Counsel for the Defendants submit that since Mr Ben was not called as a witness, evidence relating to oral representations as pleaded in paragraph 5.3.1 to 5.3.9 of the statement of claim are hearsay evidence and ought to be rejected. I disagree with counsel’s submission. The evidence on oral representations tendered by PW1 did not constitute hearsay evidence because that was the negotiations between PW1 himself and Mr Ben. It was a direct communication between the two of them. This is not a case of PW1 obtained the informations from a third party. The only suggestion put forward to PW1 is Mr Ben had no authority to make such representations. But PW1 maintain his answer that he hold on to the oral agreement made by Mr Ben. What is important to note is the business relationship between the parties is founded on trust. That is why PW1 did not ask Mr Ben to put the oral contract into writing. Considering the hugh commitment and risk undertaken by PW1 in agreeing to be the distributor of the Defendants’ products and the straight forward answers given by PW1, I had no hesitation to say that PW1 was telling the truth.

Another point raised by counsel for the Defendant with regard to oral representations is this. Under section 92 of the Evidence Act 1950, Plaintiffs cannot adduce oral evidence to contradict the distributorship agreement. To support her contention, counsel refers this court to the following cases:-

1. Foo Sam Ming v. Archi Environ Partnership [2004] 1 CLJ 759; [2004] 1 MLJ 449.

2. Tindok Besar Estate Sdn Bhd v. Tinjar Co [1979] 1 LNS 119; [1979] 2 MLJ 229.

3. Grace Shipping Inc & Anor v. CF Sharp & Co (Malaysia) Pte Ltd [1986] 1 LNS 60; [1987] 1 MLJ 257.

In all these cases the courts preferred contemporaneous documents than oral explanations by witness because memories may well be unreliable. Especially in this case where the oral evidence of PW1 was made almost 30 years after the representations. But the writ of summons and the statement of claim of this case was filed in May 1994. I do not think it is the law that in every case where there is a contemporaneous documents, oral evidence will not be preferred. It is only fair that the surrounding circumstances of the case must be taken into account as well. There are case law which recognise that oral agreement can be accepted as collateral contract side by side with the main agreement. In Tan Swee Hoe Co Ltd v. Ali Hussain Bros [1979] 1 LNS 113; [1980] 2 MLJ 16, Raja Azlan Shah (as His Royal Highness then was) in delivering the judgment of the court states:-

“In our view those cases are strong authority for the proposition that an oral promise, given at the time of contracting which induces a party to enter into the contract overrides any inconsistent written agreement. This device of collateral contract does not offend the extrinsic evidence rule because the oral promise is not imported into the main agreement. Instead it constitutes a separate contract which exists side by side with the main agreement.”

Applying the above authority to the facts of this case, it is obvious that PW1 was induced into agreeing to be a distributor of the Defendants’ products and venture into the business of marketing and distributing telecommunication equipments as a result of the oral representations made by Mr Ben as pleaded in para 5.3.1 to 5.3.9 of the statement of claim. PW1 not only belief in what Mr Ben had promised him but he hold on to that promise. In the circumstances, this court hold that the oral representations formed a collateral contract, side by side to the Distributorship Agreement.

The next issue is what is the true relationship between the parties? The Plaintiffs’ witness, in particular PW2 has mentioned that the relationship between the parties are beyond the agreement. To this witness, there was a joint venture. However one thing is certain and that is the word “joint venture” do not appear in any of the agreement. But that does not preclude this court from determining whether there was a joint venture or not. It is open to this court to make an objective assessment of the proved and admitted facts to conclude the true relationship between the parties. I will start off with the definition of the word “joint venture”. What is joint venture? A joint venture is defined by Williston on Contract (3rd Ed. 1959) Volume 2 at pp 555-556 as follows:-

In summary, then, a working definition of Joint Venture based on the actual judicial decisions may be thus formulated : A joint venture is an association of persons, natural or corporate, who agree by contract to engage in some common, usually ad hoc undertaking for joint profit by combining their respective resources, without however, forming a partnership in the legal sense (of creating that status) or corporation; their agreement also provides for a community of interest among the joint venturers each of whom is both principal and agent as to the others within the scope of the venture over which each venturer exercises some degree of control.

Next, what are the proved and admitted facts which support the existence of joint venture? One example would be the event that took place in September 1992, wherein at the request of the Defendants, the Plaintiffs implement the followings:-

1. Change the 2nd Plaintiffs’ name.

2. Recruit 25 new staff.

3. Construct a new repair centre.

4. Implement numerous advertising and promotional exercises. 5.2nd Plaintiff move places and upgrade its premises.

6. Open new service centre in Batu Pahat, Petaling Jaya, Ipoh, Penang, Miri and Kuala Lumpur.

In addition, there was an unchallenged evidence of PW3 that the 3rd Defendant had granted Uniphone Sdn Bhd a license and patent right to manufacture and market some of their Main Distributing Frame Equipment in Malaysia, India, Bangladesh, Pakistan, Bhutan, Burma, Cambodia, Laos, Nepal, Sri Lanka, Vietnam and Afghanistan.

Another instance would be Plaintiffs and Defendants jointly prepare business plan before the beginning of each new year, every year from 1991. There are also instances where despite repair agreement not being signed, the Plaintiffs undertook repair of the Defendants’ PABX equipment and repair centre were put up.

Having carefully analysed the facts of this case, I found that the parties conduct their business without adhering strictly to the provisions of the written agreement. The relationship is cordial like a partnership. They help each other. The parties’ action is actuated by trust and confidence. The Plaintiffs would not have implemented item 1 – 6 above if they had no confidence and trust in the Defendants. This kind of relationship is more than buyer and seller or distributor. To me it is consistent with a joint venture as defined by Williston with the Plaintiffs as co-venturer. Here the Plaintiff control the venture, find new market and maximize the sales. Whereas the Defendants control the products. With that I conclude that notwithstanding the word “joint venture” is not mentioned anywhere in the agreement, the conduct of the parties and the surrounding circumstances of the case irresistibly point that there was a joint venture as defined by Williston.

The next question to be decided is what is the legal consequences of a joint venture. In Newacres Sdn Bhd v. Sri Alam Sdn Bhd [1991] 1 CLJ 321 (Rep); [1991] 3 CLJ 2781; [1991] 3 MLJ 474, Jemuri Serjan (CJ Borneo) states as follows:-

With respect to the question of fiduciary relationship between the parties, learned counsel for the respondent referred us to the definitions of “Trust” and “Trustee” in the Specific Relief Act 1950 (Act 137) where fiduciary ownership and fiduciary character are included. It is the respondent’s case that a fiduciary relationship is established between the appellant and the respondent when they entered into the joint venture agreement. He supported his proposition by citing Australian Supreme Court case of Brian Pty Ltd v. United Dominions Corp Ltd [1983] 1 NSWLR 490. Samuels JA at p 506 says that after reviewing the authorities, he is of the opinion that joint venturers owe to one another the duty of utmost good faith due from every member of a partnership towards every other member. In the same case Hutley JA at p. 496 has this to say on this subject:

Though joint venture agreements are common, particularly in the resource development field, there is little authority as to the responsibilities of the joint venturers, inter se. In Canny Gabriel Castle Jackson Advertising Pty Ltd v. Volume Sales (Finance) Pty Ltd [1974] 131 CLR 321, what was described as a joint venture was held to be a partnership. That joint ventures have fiduciary relationships, inter se would seem to be essential for the efficacy of the device.

In the High Court of Australia case of Jenyns v. Public Curator (Q) [1953-54] 90 CLR 113,Dixon C J, Me Tiernan and Kitto JJ have this to say at p 133:-

We are not here dealing with any of the traditional relations of influence or confidence-solicitor and client, physician and patient, priest and penitent, guardian and ward, trustee and cestui que trust. It is a special relationship set up by the actual reposing of confidence. It is therefore necessary to see the extent and nature of the confidence reposed and whether it involved any ascendancy over the will of the person supposedly dependent on the confidence.

The judges here were talking about fiduciary relations between the parties. In the case of James Birtchnell & Anor v. The Equity Trustees, Executors and Agency Co Ltd & Anor [1928-30] 42 C L R 384 Dixon J at p. 407 explains the fiduciary relationship between partners and how the relationship is to be determined.

This is what he says:-

The relationship between partners is, of course, fiduciary. Indeed, it has been said that a stronger case of fiduciary relationship cannot be conceived than that which exists between partners. “Their mutual confidence is the lifeblood of the concern. It is because they trust one another that they are partners in the first instance; it is because they continue to trust one another that the business goes on” (per Bacon VC in Helmore v. Smith [1890] 15 App Cas 223 at p 225; [1886] 35 Ch D 436 at p 444).The relation is based, in some degree, upon a mutual confidence that the partners will engage in some particular kind of activity or transaction for the joint advantage only. In some degree it arises from the very fact that they are associated for such a common end and are agents for one another in its accomplishment. Lord Blackburn found in this consideration alone sufficient reason for the fiduciary character of the partnership relation (Cassels v. Stewart [1881] 6 App Cas at p. 79).The subject matter over which the fiduciary obligations extend is determined by the character of the venture of undertaking for which the partnership exists, and this is to be ascertained, not merely from the express agreement of the parties, whether embodied in written instrument or not, but also from the course of dealing actually pursued by the firm. Once the subject matter of the mutual confidence is so determined, it ought not be difficult to apply the clear and inflexible doctrines which determine the accountability of fiduciaries for gains obtained in dealing with third parties.

That passage was approved by Lord Wilberforce in the case of New Zealand Netherlands Society Oranje Incorporated v. Kuys & Anor [1973] 2 ALL ER 1222 at p 1226, Lord Wilberforce says, after quoting the relevant passage of Dixon J’s judgment:-

This was said in the context of a partnership but the principle must be of general application.

In this case, it is the Plaintiffs’ pleaded case that the Defendants as co-venturer owed a fiduciary duty to the Plaintiffs. Applying the above principles discussed in Newacres case, I hold that the Defendants as a joint venturer stood in fiduciary position to the Plaintiffs in relation to the continuity of the Plaintiffs as the distributor of the Defendants’ products. Any transaction engaged by the Defendants must be in good faith for the joint benefit of the venture only. If the Defendants did not terminate the agreement abruptly and did not appoint Folec, the Plaintiffs would not have suffered losses.

Termination

In order to determine whether the termination is unlawful, this court take into consideration the the chronology of event that had taken place between the parties as follows:-

1. In or about 1992,the Plaintiffs identified Hyatt Hotel in Johor Bahru as a potential customer for the PABX System and the same was communicated to the Defendants so that a joint strategy could be worked out. But the 1st Defendant authorized and assisted Folec Communications (Singapore) Pte Ltd (Folec Singapore) to bid for the same project using the same equipment.

2. Whilst the relationship existed between the Plaintiffs and the Defendants,DW3 had unilaterally appointed Folec Communication (M) Sdn Bhd as a parallel distributor in Malaysia for the NT products.

3. Plaintiffs was led to believe that a new contract for 1994 will be made. But it turn out that such promise was made with no intention to honour.

4. The sale target set by the Defendants for the Plaintiffs for 1994 was USD 2.5 million and the Plaintiffs have achieved this target.

5. Only in a meeting held on 19.4.1994 between both parties, the Plaintiff was informed that the agreement will not be renewed. The decision was notified in writing on 20.4.1994.

In view of the special relationship existed between the parties since 1979, the Defendant’s conduct of terminating the agreement abruptly and immediately without just cause was indeed unlawful and unjust to the Plaintiff.

Plaintiffs To Prove Its Loss

It is settled law that a party who claim for damages must prove its claim. Lord Goddard in Bonham Carter v. Hyde Park Hotel Ltd 64, TLR 177, 178 states the principle as follows:-

Plaintiff must understand that if they bring action for damages, it is for them to prove their damages; it is not enough to write down the particulars, so to speak, throw them at the head of the Court saying :This is what I have lost, I ask you to give me these damages. They have to prove it.

In Popular Industries Limited v. Eastern Garment Manufacturing Sdn Bhd [1990] 2 CLJ 635 (Rep); [1990] 1 CLJ 133; [1989] 3 MLJ 360, at page 367, the High Court states:-

“It is axiomatic that a Plaintiff seeking substantial damages has the burden of proving both the fact and the amount of damages before he can recover. If he proves neither, the action will fail or he may be awarded only nominal damages upon proof of the contravention of a right. Thus nominal damages may be awarded in all cases of breach of contract (see Marzetti v. William). And, where damage is shown but its amount is not proved sufficient tly or at all, the Court will usually decree nominal damages. See for example Dixon v. Deveridge and Twyman v. Knowles.

In Mallet v. Me Mongale [1970] AC 166 at p 176, Lord Diplock enunciated the following principles of law:-

The role of the Court in making an assessment of damages which depends upon its view as to what will be and what would have been is to be contrasted with its ordinary function in civil actions of determining what was. In determining what did happen in the past a Court decide on the balance of probabilities. Anything that is more probable than not it treats as certain. But in assessing damages which depends upon its view as to what will happen in the future or would have happened in the future if something had not happened in the past, the Court must make an estimate as to what are the chances that a particular thing will or would have happened and reflect those chances, whether they are more or less than even in the amount of damages which it awards.

With those principles in mind, I will assess the damages claimed by the Plaintiffs. Under paragraph 13 of their statement of claim, the amount of special damages claimed by the Plaintiffs is RM21,439,000.00. To prove this amount, the Plaintiffs relied on the evidence of PW4 and PW5. Both witnesses gave evidence on the amount invested and the losses suffered by the Plaintiffs. Their evidence is based on the account audited by Hanafiah Raslan & Mohamad which was acquired by Arthur Andersen. To begin with, PW4, a qualified accountant, told the court that after the Distribution Agreement was terminated on 20.4.1994, the Plaintiff was without a core business but with employees, stock in trade, trade creditors and debtors. He further testify that when the distributorship agreement was stopped, the Plaintiff’s business came to a stop with the exception of existing maintenance agreement between the 2nd Plaintiff and its customers which include service and repair contracts. He further testify that the financial year only ended on 31.1.95. Post termination, the 2nd Plaintiff did not carry on any new business and the figures appearing in the audited accounts for the year ending 1995 prove all its losses. Based on the audited account for the year ending 1995, PW4 said the total losses suffered by the Plaintiff as a result of the termination is RM12,787,000.00. According to him, this amount includes the stock in trade at a cost of RM3,351,000.00, expenses incurred in recruiting additional new employees, constructing a new repair centre for the Defendants’ products, training for staffs, advertising and other promotional expenses, renting and renovating a new premise and for renting premises as service centres in Batu Pahat, Petaling Jaya, Ipoh, Penang, Miri and Kuala Lumpur. Counsel for the Defendants sought to challenge the accuracy of PW4s’ statement on RM12,787,000.00 to which PW4 agrees that the source documents and the breakdown figures for the said amount is not before the court. But PW4 categorically disagree that RM12,787,000.00 did not reflect Plaintiffs’ losses as a result of the termination.

Counsel for the Defendants also sought to show that the Plaintiffs did not suffer any losses because for eight years from 1979, 1983, 1985, 1986, 1987, 1990 and 1991, the 2nd Plaintiff suffered a loss and the profits for years 1980, 1981, 1982, 1989, 1992 and 1993 were marginal. Whether there was profits or losses, the fact remained that after the termination, the Plaintiff had no new business but they had already incurred expenses in keeping stocks as well as overhead charges.

PW5 on the other hand testify that as at 31.1.1995, the 2nd Plaintiff has lost a sum of RM9,532,662.00 being its actual amount invested in the PABX venture and a further sum of RM3,350,829.00 being the value of the stock in hand which the Defendants refused to repurchase after the termination. PW5 is not able to produce evidence to show that an offer was made by the Plaintiff to sell the stock to the Defendants and the same was rejected by the Defendant.

To counter the accuracy of the audited accounts, the Defendants, through their solicitors has approached Messrs BDO Binder to review the audited accounts of the Plaintiff for the financial years ended 31.12.1979 to 31.1.1995. The instruction was given to BDO Binder vide a letter dated 18.4.2005. This task was carried out by DW1, a qualified accountant. DW1 has prepared a report dated 15.7.2005, marked WSDW1. What is important to note is this report was never produced and shown to PW4 and PW5 during the Plaintiffs’ case. This report was only introduced during the Defendants’ case. It therefore deprived the Plaintiffs’ chances to question the accuracy of the content of the report. Obviously the report prepared by DW1 is negative in every aspect of the Plaintiffs claim. Commenting on the amount claimed by the Plaintiffs’ under paragraph 13 of the statement of claim, DW1 keep on repeating that they are unable to verify the amount claimed from the audited account.

Having perused exhibit WSDW1 and compared it with the audited account submitted by the Plaintiffs, I have no hesitation to say that the audited account by Arthur Andersen is more reliable and accurate for the following reasons:-

1. Arthur Andersen is an established and reputable public accountants.

2. Their examination was made in accordance with approved auditing standards.

3. It is the opinion of the public accountants that:-

(i) The accounts are properly drawn up in accordance with the provisions of the Companies Act, 1965 and give a true and fair view of the state of affairs of the Company as at 31.1.1995; and

(ii) The accounting and other records and the registers required by the Act to be kept by the Company have been properly kept in accordance with the provision of the Act.

Based on the reasons above, I therefore reject DW1s’ evidence and the report prepared by him. With the rejection, this court is left with no option but to accept the evidence adduced by PW4 and PW5. Their evidence have proved that the Plaintiffs did suffer losses in terms of the amount invested in the venture, the stock in hand and the various expenses incurred to keep the venture going but with no new business. As for the quantum of losses suffered, I accept their evidence based on the audited account. The figures in the audited account reflect the true state of affairs in the Plaintiffs’ company.

To conclude, on the balance of probability, I found that the Plaintiffs have succeeded in proving their claim. I, therefore allowed the Plaintiffs claim as prayed for in prayer 13.2 (a), (d) and (e) of the statement of claim. Interest at the rate of 8% per annum from the date of filing of the writ till satisfaction and cost of this action.

HIROSHI IWABUCHI LWN. PP MAHKAMAH TINGGI [KUALA LUMPUR] MOHD GHAZALI MOHD YUSOFF, H RAYUAN JENAYAH BIL: 42-33-2000 9 JUN 2002 (MALAYSIA)

HIROSHI IWABUCHI LWN. PPMAHKAMAH TINGGI [KUALA LUMPUR]MOHD GHAZALI MOHD YUSOFF, HRAYUAN JENAYAH BIL: 42-33-20009 JUN 2002

DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR

WILAYAH PERSEKUTUAN

RAYUAN JENAYAH BIL: 42-33-2000

HIROSHI IWABUCHI

LAWAN

PENDAKWA RAYA

ALASAN PENGHAKIMAN

Perayu, seorang warga negara Jepun telah didakwa dihadapan mahkamah sesyen dengan pertuduhan-pertuduhan seperti berikut:-

Pertuduhan pertama

Bahawa kamu, pada 19hb November 1999, di antara jam lebih kurang 12.01 pagi hingga 4,00 pagi di dalam sebuah bilik nombor 1523, di Hotel Shangri-La, Jalan Sultan Ismail, dalam daerah Dang Wangi, dalam Negeri Wilayah Persekutuan Kuala Lumpur, telah merogol Chai Lai Mun KP: 721126-14-5038 dan dengan itu kamu telah melakukan suatu kesalahan yang boleh dihukum di bawah seksyen 376 Kanun Keseksaan.”

Pertuduhan pilihan

“Bahawa kamu, pada 19hb November 1999, di antara jam lebih kurang 12.01 pagi hingga 400 pagi di dalam sebuah bilik nombor 1523, di Hotel Shangri-La, Jalan Sultan Ismail, dalam daerah Dang Wangi, dalam Negeri Wilayah Persekutuan Kuala Lumpur, telah menggunakan kekerasan jenayah kepada Chai Lai Mun KP: 721126-14-5038 dengan niat untuk mencabul kehormatannya dan oleh yang demikian itu kamu telah melakukan suatu kesalahan yang boleh dihukum di bawah seksyen 354 Kanun Keseksaan.”

Perayu telah minta dibicarakan dan di akhir kes pendakwaan, ia telah dilepaskan dan dibebaskan atas pertuduhan pertama itu. Walau bagaimanapun, ia telah diarahkan membela diri atas pertuduhan alternatif itu. Di akhir kes pembelaan, perayu telah didapati bersalah dan disabitkan atas tuduhan alternatif itu. Hakim mahkamah sesyen (“hakim perbicaraan”) telah menjatuhkan hukuman pemenjaraan selama 8 tahun bermula dari tarikh tangkap, iaitu, 22 November 1999 dan 10 sebatan. Perayu terkilan dengan sabitan dan hukuman itu dan berikutnya merayu ke Mahkamah Tinggi. Saya telah menolak rayuannya tentang sabitan dan hukuman pemenjaraan tetapi telah mengurangkan hukuman sebatan yang dijatuhkan dari 10 sebatan ke 3 sebatan. Terhadap keputusan itu perayu merayu ke Mahkamah Rayuan.

Fakta kes menunjukkan mangsa (SP3) yang berumur 37 tahun, bekerja sebagai pengurus di sebuah syarikat yang bernama Inchipi (M) Sdn Bhd yang menjalankan perniagaan sebagai ejen membekalkan pekerja-pekerja. Ia telah berkahwin dengan seorang warga negara Jepun bernama Kenichiro Sugita (SP4) dan mereka dikurniakan dengan seorang anak. Inchipi (M) Sdn Bhd membekalkan pekerja kepada syarikat di mana perayu berkhidmatdan SP3 pernah menemuinya sebanyak tiga kali bagi urusan perniagaan.

Pada 18 November 1999 SP3 telah mengaturkan majlis makan malam atas permintaan perayu di sebuah restoran cina bernama Golden Phoenix di Hotel Equatorial, Kuala Lumpur, ia telah menempahkan dua meja. Ia juga dijemput oleh perayu untuk menghadiri majlis itu yang bermula pada jam lebih kurang 7.30 malam. SP3 membawa dua botol wain ke majlis itu dan ada minum dua gelas wain dan juga dua atau tiga gelas bir selain dari teh cina.

Setelah majlis bersurai pada jam lebih kurang 10.45 malam, perayu telah mempelawa SP3 dan satu Roslan bin Yahya (“Roslan”) untuk beristirehat di “The Pub” di Hotel Shangri-La, Kuala Lumpur (“hot I itu”). Dalam keterangannya SP3 menyatakan ia tidak tahu bahawa perayu menginap di hotel itu. Ia menjelaskan ia menerima pelawaan perayu atas alasan ia rasa bersalah kerana perayu tidak berpuas hati dengan majlis makan malam itu yang diaturkan olehnya. Roslan juga menerima pelawaan perayu. Semasa mereka beristirehat di “The Pub”, SP3 menyatakan ia telah minum tiga gelas minuman keras dan kemudiannya telah pergi ke tandas. Ia telah sambung minum selelah ke tandas dan selepas beberapa minit kemudian, telah tidak sedarkan diri.

Apabila ia sedar pada jam lebih kurang 4.00 pagi, iaitu, pada 19 November 1999, ia mendapati ia berada di atas sebuah katil dan tidak berpakaian. Ia melihat perayu juga berada dalam bilik itu. Perayu sedang duduk di atas sofa dalam keadaan telanjang dan sedang merokok. SP3 telah kemudiannya mengambil satu jubah tuala dan pergi ke bilik air bilik itu. Di bilik air ia mendapati darah sedang meleleh daripada bahagian bawah badannya. Ia telah membuang air kecil dan mendapati banyak darah meleleh. SP3 kemudiannya hanya membasuhkan kakinya kerana ia mendapati ada kecederaan di bahagian kemaluannya. Ia kemudian keluar dari bilik air itu dan meminta perayu pakaiannya yang ia gagal mengesan sebelum itu. Seterusnya ia bertanya perayu apa yang beliau telah buat kepadanya. Apabila perayu tidak menjawab, ia telah beredar dari bilik itu dan terus turun ke lobi hotel itu. Ia telah mencuba mendapatkan teksi tetapi gagal dan berikutnya telah menalipon SP4, iaitu, suaminya melalui telefon bimbitnya untuk menjemputnya. Pada jam lebih kurang 5.00 pagi hari yang sama, SP4 tiba di hotel itu dan terus membawa SP3 pulang. SP3 telah memberitahunya ia didatangi haid dan mabuk dan telah tidur di “The Pub”.

Tiba di rumah SP3 telah tidur dan bangun pada jam 11.00 pagi. Ia telah pergi ke bilik air untuk membuang air kecil dan melihat darah masih meleleh dan berasa sakit di bahagian kemaluan dan duburnya. Ia telah mengambil cermin untuk melihat dan mendapati bahagian-bahagian itu merupai “daging cincang”. Pada jam lebih kurang 11.30 pagi hari yang sama, iaitu, 19 November 1999 ia telah pergi ke sebuah klinik yang bernama Klinik Reddy dan berjumpa dengan satu Dr Soong. Setelah memberitahu Dr Soong bahawa ia telah dirogol dan dicederakan, doktor itu menyuruhnya pergi ke Hospital Tawakkal dan berjumpa dengan seorang gynaecologist bernama Dr Foong. Di Hospital Tawakkal, setelah menjalankan pemeriksaan, Dr Foong telah memintanya berjumpa satu Dr Tham di hospital yang sama dan berikutnya telah di masukkan ke wad untuk dirawat.

SP3 kemudiannya menghubungi SP4 dan memberitahu ia sedang dirawat di hospital itu. Ia telah juga menelefon perayu dan bertanya sekali lagi apa yang beliau telah buat kepadanya. Perayu telah menjawab bagaimana ia boleh menolong dan kemudiannya meletakkan telefon. Pada jam lebih kurang 7.00 malam pada hari yang sama, pihak hospital telah menjalani pembedahan ke atas SP3. Berikutnya ia telah dimaklum oleh satu Dr Lee (SP14) bahawa ada koyakkan besar di bahagian kemaluannya dan duburnya dan kedua-dua bahagian itu hampir tercantum dan ia hampir maut. SP14 juga memaklum apa yang telah dilakukan terhadapnya adalah tidak menurut tabiat. SP3 telah seterusnya menghubungi Shigeru Matsuo (SP5) yang juga mengenali perayu dan memberitahu ia telah dirogol oleh perayu. Berikutnya SP4 bersama dengan SP5 melawat SP3 di hospital dan setelah SP4 diberitahu tentang kejadian itu, beliau telah membuat laporan polis pada 20 November 1999.

Dalam keterangannya, Raja Muhammad (SP7) yang berkhidmat dengan hotel itu semenjak 15 Januari 1997 menyatakan pada 18 November 1999 ia bertugas sebagai kapten di “The Pub”. Pada jam 11.00 malam pada tarikh itu, ia melihat Roslan, yang ia kenali, datang ke “The Pub” dengan perayu dan SP3. Mereka berada di situ selama satu hingga satu jam setengah dan ada memesan minuman. Roslan minum air suam dan SP3 minum gin tonik, wain merah, Tia Maria dan juga coke. Pada mulanya SP3 hendak membayar bil minuman itu dan memberi kad kreditnya tetapi perayu telah menandatangani bil itu atas namanya dan biliknya di hotel itu bernombor 1523. Selepas meminta bil SP3 telah pergi ke tandas. Berikutnya ia telah memulangkan kad kredit SP3. Pada jam lebih kurang 1.00 pagi SP3 dan perayu telah beredar dari situ. SP3 dan perayu sedang berpeluk-pelukan sambil berjalan dan berbual-bual. Ia berpendapat SP3 dalam keadaan mabuk dan gembira. Walau bagaimanapun ia tidak nampak kemana mereka pergi.

Yukako Ito (SP12) yang bertugas di hotel itu sebagai pegawai perhubungan pelanggan menyatakan ia telah berkhidmat dengan hotel itu selama 1 tahun 9 bulan dan tugasnya, antara lain, adalah untuk melayan pelanggan Jepun dan membantu mereka. Ia menyatakan pada 10 November 1999 jam lebih kurang 8.00 malam perayu telah datang seorang diri untuk menempah bilik di hotel itu. Ia telah mendaftarkan perayu dan menempatkannya di bilik No. 1523. Perayu diberi satu kunci bilik sahaja. Ia berkenalan dengan perayu kerana beliau pernah menginap di hotel itu beberapa kali sebelum itu.

Dalam keterangannya, SP4, iaitu, suami SP3 yang berkhidmat dengan sebuah syarikat tempatan bernama Nichei (M) Sdn Bhd selaku pengarah urusannya menyata ia telah berkahwin dengan SP3 selama 2 tahun 2 bulan pada tarikh perbicaraan ia tahu SP3 telah pada 18 November 1999 pergi ke majlis makan malam tersebut ia berkenalan dengan perayu semenjak bulan Oktober 1999 sebab perayu juga merupakan pelanggan syarikatnya. SP4 menyatakan pada 19 November 1999 jam lebih kurang 4.00 pagi ia ada menerima panggilan telefon daripada SP3 dan berikutnya telah pergi ke hotel itu untuk menjemputnya. Tiba di sana ia telah memarahi SP3. Setelah mendapati darah di lututnya ia bertanya SP3 sama ada beliau telah dirogol. SP3 telah menjawab ia telah didatangi haid. SP3 telah memaklumkan selepas majlis bersurai ia telah pergi ke hotel itu dengan perayu dan Roslan. Tiba di rumah, SP3 telah menanggalkan pakaiannya dan terus tidur. Ia mendapati darah dicelah kaki SP3 dan terus mengambil tuala basah untuk membersihkan kesan darah itu. Pada hari yang sama, iaitu, 19 November 1999, di antara jam 12.00 tengah hari dan 4.30 petang, SP3 telah menghubunginya melalui telefon dan memaklumkan ia berada di hospital dan dimasukkan ke wad kerana pihak hospital hendak menjalankan pembedahan ke atasnya. Pada keesokannya ia telah dimaklum oleh SP3 tentang apa yang telah berlaku di hotel itu dan atas nasihat peguamnya telah pergi ke balai polis dan bertemu satu Cif Inspektor Tan (SP15). SP15, selaku pegawai penyiasat kes, telah kemudiannya bertemu SP3 di Hospital Tawakkal dan mengambil laporannya (ekshibit P.7).

Dalam keterangannya, Matsuo Shigeru (SP5) menyata ia tiba di Malaysia pada 18 Oktober 1999. Perayu merupakan rakan sekerja di dalam syarikat yang sama. Ia juga berkenalan dengan SP3 yang mempunyai perhubungan urusan dengan syarikat di mana ia bekerja. Pada 18 November 1999 ia hadir di majlis makan malam tersebut bersama SP3 dan perayu. Selepas majlis bersurai ia telah pulang ke biliknya di Hotel Hilton. Pada 20 November 1999 ia telah menerima panggilan telefon dari SP3 dan seterusnya melawatnya di Hospital Tawakkal. SP3 telah memaklumkan ia telah dirogol. Pada hari yang sama jam lebih kurang 3.00 petang ia telah bertemu dengan SP4 dan telah memaklumkan tentang apa yang dicerita kepadanya oleh SP3.

Dalam keterangannya Dr Lee Sin Hong (SP14), yang berkhidmat sebagai doktor bedah di Hospital Tawakkal, menyatakan ia telah menjalankan pemeriksaan ke atas SP3 pada 19 November 1999 jam lebih kurang 7.30 malam di bilik pembedahan hospital itu. Masa itu SP3 di bawah pembiusan Ia menyata:

“SP3 telah berjumpa dengan consultant gynaecologist Dr Tham who was doing an operation on her for vaginal injury and half-way through the operation Dr Tham realised that he was unable to handle the degree of injury because the injury seem to involve the rectum as well so Dr Tham called me to assist in the repair of this injury.

Saya periksa seperti diminta di operating theatre. Bila saya periksa injury SP3 dia ada 2 injury – 1 laceration at about 7.00 o’clock position in the vagina. This laceration went to through the whole thickness of the vagina and extends further 15 cm into the vagina and cuts through posterior fornix – and then curve around to the front of the cervix.

The second injury was at the back of the wall of the vagina at 5 o’clock position. This was a deep laceration cutting through the vagina into the rectum. There is also a similar tear in the rectum connecting the rectum with the vagina and tearing all the splinter muscle of the rectum.

Pada pendapat saya kecederaan dilakukan oleh kemasukkan “blunt object” with great force. Kemaluan lelaki boleh mengakibatkan kecederaan ini. I do not think it is likely to occur in normal sexual intercourse because there seem to be 2 different injuries. The longer tear will require a blunt object with a lot of force pushing top end of vagina to cause such a long tear Normal sexual intercourse is not enough. The 2nd laceration which tore through rectum to the vagina was in a position of 2 cm from the “introus” (vagina opening). This can only be caused by something tearing through with great force at an angle perpendicular to vagina wall.

The injury will cause extensive degree of pain. It is unlikely a conscious person can withstand this degree of pain.

Both the injuries can cause profuse bleeding. Kecederaan ini tidak boleh akibat menstruation. Jika tidak rawat pesakit akan develop infection in the whole “abdominal cavity and may die from this injury.

After examining the injury I repaired the rectum and reconstructed the spinchtermuscle and repairing the laceration in the vagina.

The longer laceration needed “debritement” meaning “timing” & “glancing” and then repair the vagina. “

SP14 menjelaskan kecederaan sedemikian boleh disebabkan oleh mana-mana jenis objek yang merupai batang atau tongkat yang hujungnya tumpul. Semasa ia membuat pemeriksaan ke atas SP3, ia mendapati vagina SP3 telah terkoyak seluruhnya. Berikutnya ia menyatakan:

“Mengeluarkan IUD tidak boleh mengakibatkan kecederaan seperti ini. Pada 20.11.99 it is unlikely the result of blood test for drug was negative because anaesthetic was administered. The patient related the history on 20.11.99. A fall can cause the injury but it is unlikely because the fall should have been on a rod-like object which is positioned at the vaginal entrance otherwise she should have some other associated injuries. She must have fallen twice on the same object at 2 angles to result in 2 separate injuries.”

“These injuries are unlikely to be caused by a normal male organ. There must be other equipment, instrument or apparatus used.”

SP13, seorang ahli kimia forensik dengan Jabatan Kimia, Petaling Jaya menyatakan pada 26 November 1999 ia telah menerima beberapa barang dari pihak polis termasuk beberapa pakaian SP3, tuala, sarung bantal dan penutup tilam yang mana ada kesan darah untuk menjalankan analisa DMA (Deoxyribo Nucleic Acid). Ia juga dibekalkan sampel darah SP3 dan perayu. Ia mengesahkan darah yang terdapat di atas barangan itu adalah darah SP3. Ia tidak mengesan darah atau bekas air mani perayu dari barangan itu. Ia menyata:

I also carried out statistical evaluation and found that the probability of an unrelated person having the same DNA profile as that develop from blood stain is 1 in approx 5.2 billion.”

“I found the DNA profiles obtained from the seminal stain from 3 areas analysed on the mattress cover (envelope ‘H’) did not match each other and they also did not match the DNA profile obtained from blood specimen ‘K’ labelled Hiroshi Iwabuchi. These results indicated that the seminal stains on mattress cover did not originate from blood specimen ‘K’ and were from 3 different sources.”

Dalam keterangannya Foong Suen Ming (SPG) yang bertugas sebagai Pengurus “Guest Service” di hotel itu menyatakan pada 20 November 1999 jam lebih kurang 4.00 petang, ia dikunjungi oleh satu pasukan polis yang diketuai oleh SP15. Ia telah membawa mereka ke bilik No. 1523 dan mendapati bilik itu berselerak dan ada kesan berwarna merah di cadar dan kesan darah di pemaidani dan di tuala mandi dalam bilik air. Pihak polis telah merampas satu sarung bantal, satu pelindung katil, satu cadar, dua tuala mandi, tiga buku lucah dan satu paket kondom. Pihak polis telah menyediakan satu borang rampasan dan ia telah menandatangani borang itu. SP6 menyatakan menurut rekod hotel, perayu menempah bilik pada 10 November 1999 dan ditempatkan di bilik No. 1523 dan dijangka akan tinggal di hotel itu selama 45 hari.

Mary Filomin (SP9) yang bertugas di hotel itu sebagai “housekeeping room attendant” menyatakan pada 19 November 1999 jam lebih kurang 10.00 pagi ia telah masuk ke bilik No. 1523 itu untuk mengemasnya. Masa itu tiada orang ada dalam bilik itu. Oleh kerana ia melihat kesan darah di cadar yang berada di atas lantai dan juga kesan darah bersama kesan kaki atas pemaidani, ia tidak membersihkan bilik itu. Kemudiannya ia telah sekali lagi memasuki bilik No. 1523 itu bersama penyelia hotel itu (SP10) dan di bilik air bilik itu mendapati kesan darah dalam kolam mandi dan di jubah tuala dan juga di atas lantai bilik air itu. SP10 mengesahkan ia ada memeriksa bilik itu dan melihat ada banyak tompokan darah di atas katil dan juga di atas bantal. Di atas pemaidani menghala ke bilik air bilik itu ia melihat ada tompokan darah juga dan di bilik air adanya banyak tuala yang berkesan darah. Ia telah melaporkan kepada orang atasannya.

SP15 menyatakan pada 20 November 1999 jam 8.00 malam ia telah bertemu dengan SP3 di hospital dan beliau telah membuat laporan. Ia menangkap perayu pada 22 November 1999 jam 10.15 malam di Lapangan terbang Antarabangsa Kuala Lumpur.

Tan Hooi Tao (SP16) yang bekerja dengan Security Marketing Sdn Bhd menyatakan dalam tahun 1996 syarikatnya telah membekalkan sistem penguncian “keycard” sistem di hotel itu. Rekod dalam sistem penguncian itu menunjukkan pada kali terakhir “guest card user ID No. 5540″ digunakan untuk bilik No. 1523 itu adalah pada 19 November 1999 jam 1.00 pagi.

Di penutup kes pendakwaan, hakim perbicaraan berpuas hati bahawa pihak pendakwaan telah membuat satu kes prime facie atas pertuduhan alternatif itu, iaitu, bahawa perayu telah menggunakan kekerasan jenayah kepada SP3 dengan niat hendak mencabul kehormatannya yang mana adalah kesalahan di bawah seksyen 354 Kanun keseksaan dan oleh itu telah memanggil perayu memasukkan pembelaannya. Dalam pembelaannya perayu memberi keterangan seperti berikut:-

(1) Ia bekerja sebagai pengurus projek dengan sebuah syarikat tempatan bernama Tepsco (M) Sdn Bhd mulai 10 November 1999. Ia akui ia hadir di majlis makan malam yang diadakan di restoran cina di Hotel Equatorial itu pada 18 November 1999 tetapi menjelaskan Matsuo (SP5) yang mengaturkan majlis itu dan SP5 telah menjemput SP3. Di majlis makan malam tersebut ia telah minum 4 atau 5 gelas bir dan juga 3 atau 4 gelas wain.

(2) Setelah majlis bersurai ia telah beredar dari restoran cina itu dan semasa ia berada di lobi Hotel Equatorial itu, ia terjumpa Roslan dan SP3. Ia telah menjemput Roslan ke Hotel Shangri-La untuk bincang hal kerja. SP3 telah terdengar perbualan mereka dan menyatakan ia hendak ikut bersama.

(3) Tiba di Hotel Shangri-La itu, pada jam lebih kurang 11.00 malam, atas cadangan SP3, mereka telah pergi ke “The Pub”. Roslan pesan air panas limau dan SP3 minum gin dan tonik sementara ia meminum Guiness Stout dan juga wain merah. Mereka telah beredar dari “The Pub” di antara jam 12.30 pagi ke 12.45 pagi. Ia telah menandatangani bil minuman itu atas namanya dan mencatatkan nombor biliknya di hotel itu.

(4) Semasa mereka keluar dari “The Pub”, ia telah berpelukan dengan SP3 dan telah pergi ke lobi hotel itu. Roslan telah beredar dari situ dan seterusnya ia telah mengambil begnya yang tersimpan di kaunter hotel itu untuk membawa ke biliknya. Setelah ia mengutip begnya ia melihat SP3 sedang berbual dengan dua orang lelaki cina yang ia tidak kenali di lobi hotel itu. Ia seterusnya balik ke biliknya pada jam lebih kurang 1.00 pagi. Sebelum ia balik ke biliknya, SP3 tidak pula datang berjumpanya atau mengikutnya ke biliknya.

(5) Tiba di biliknya ia telah semak jadual kerjanya pada keesokannya dan seterusnya menanggal kesemua pakainnya dan selepas mandi telah tidur secara berbogel. Sebelum ia tidur ia tidak pasti pintu biliknya ditutup atau tidak tetapi ia telah biarkan satu lampu menyala.

(6) Pada jam lebih kurang 3.30 pagi ia rasa tak sihat dan telah bangun. Ia menyatakan:

“Selepas bangun saya rasa mimpi ada orang berdiri depan saya tetapi lepas itu saya nampak betul ada orang berdiri depan saya. Pada masa itu saya tak nampak siapa orang itu. Saya rasa terkejut dan saya bangun dan pasang lampu. Saya nampak Miss Yen tidak pakai baju tidur di tepi saya. Miss Yen dalam keadaan bogel (katakan) saya terkejut mengapa Miss Yen ada di tepi saya. Saya turun dari katil dan saya pakai bath robe dan ambil bed sheet dan cover Miss Yen. Saya kejutkan Miss Yen untuk tanya Miss Yen kenapa dia berada disitu tetapi ia tidak bangun.”

“Di bilik itu ada satu katil King Size. Saya merasa hendak merokok dan saya pun duduk atas sofa dan merokok. Masa merokok Miss Yen bangun. Saya ingat nak tanya kenapa ia berada disini dan saya tanya. Ia kata di lobby dia pergi minum dengan 2 orang lelaki itu di luar tetapi tak kata Diana. Saya ada tanya Miss Yen macam mana ia masuk bilik saya.”

“Miss Yen kata pintu itu terbuka oleh itu ia boleh masuk. Miss Yen beritahu pukul 3.00 pagi ada 2 lelaki Cina pergi minum di luar dengan Miss Yen. Miss Yen rasa sudah lewat jadi ia datang ke bilik saya. Masa itu Miss Yen dalam keadaan biasa. Saya tanya Miss Yen kenapa ia terus tidur di katil, Miss Yen kata ia letih dan lewat dan oleh itu ia tidur di katil. Saya ada tanya Miss Yen tentang pakaiannya dan ia cakap ia masuk dalam bilik rasa panas dan ada muntah dan baju kotor oleh itu ia tanggal pakaian. Miss Yen buka bajunya sendiri.”

“Miss Yen letak pakaiannya di kerusi dan ia minta baju diberi kepadanya. Kami berada dalam bilik. Selepas saya serah baju kepadanya Miss Yen masuk dalam bilik air dan pakai pakaiannya. Miss Yen pergi ke bilik air dengan jalan biasa. Pakaian saya serah kepadanya baju hitam.”

“Semua sekali diserah kepada Miss Yen. Panties berada di atas baju, bra juga ada di atas baju. Masa saya serah Miss Yen berada di tepi katil. Saya tidak boleh ingat ada berapa lama dalam bilik air. Perbualan saya dengan Miss Yen dalam Japanes dan Inggeris. Masa Miss Yen pergi ke bilik air saya nampak ada darah atas katil.”

“Saya pun tidak kata apa-apa. Selepas Miss Yen pakai pakaian ia balik dan saya kata saya akan hantar ke tempat parking kerana masa itu 4.00 pagi lebih. Tempat parking saya tidak tahu Miss Yen yang kata ia letak kereta di Car Park. Miss Yen kata ia boleh pergi sendiri ke Car Park.”

“Masa Miss Yen bual dengan saya secara biasa. Miss Yen tidak complaint sakit. Miss Yen keluar bilik saya 4.00 lebih pagi. Miss Yen boleh jalan dengan biasa. Selepas Miss Yen keluar saya naik katil dan tidur. Saya bangun pukul 8.00 pagi.”

“Sebelum Miss Yen keluar dari bilik ke Car Park ia kata minta maaf saya masuk ke bilik kamu tanpa kebenaran dan selepas itu ia cium saya di pipi.”

Perayu mendesakkan ia “ada nampak ada orang berdiri dan bukan mimpi masa saya bangun pukul 3.00 pagi”. Ia kemudian menafikan ia mencederakan SP3 dan mengesahkan SP3 tidur disebelahnya dalam keadaan bogel tanpa pengetahuannya. Semasa ia diperiksa balas, perayu setuju masa ia keluar dari the Pub” dengan SP3 mereka berpelukan. Walau bagaimanapun ia/tidak setuju mereka mabuk dan tidak stabil kerana telah minum banyak. Kemudiannya ia menyatakan mereka berpelukan semasa keluar dari “The Pub” kerana ia telah minum banyak dan ia tidak tahu apa mereka buat selepas itu. Apabila disoal selanjutnya perayu menyatakan:-

“Dari pub saya sahkan saya pergi ke lobby bersama Miss Yen. Saya tidak setuju saya minum banyak dan tidak tahu apa yang saya buat.”

Perayu tidak bersetuju dengan cadangan pegawai pendakwa bahawa pintu biliktertutup dengan sendiri selepas ia masuk. Ia kemudian menafikan ia ada melihat seseorang berdiri dihadapannya semasa ia terjaga pada jam 3.30 pagi dan menyatakan ia ternampak SP3 sedang tidur disebelahnya apabila ia terjaga pada masa itu. Ia melihat SP3 tidak berpakaian dan tidak nampak darah berlumuran ketika itu. Ia ada cuba mengejutkan SP3 tetapi tidak menyentuhnya dan selepas itu mengambil selimut dan menutupnya. Ia kemudian memakai jubah tuala dan pergi ke sofa yang berada dalam bilik itu. SP3 telah kemudiannya bangun dari tidur dan ia melihat darah di atas katil. Ia juga. melihat ada darah di tempat lain. Ia telah bertanya SP3 mengenai darah itu dan beliau menjawab “adalah menses yang serious”.

Perayu juga menafikan ia berpelukan dengan SP3 dengan pengetahuan beliau mabuk dan seterusnya mengambil kesempatan untuk membawanya ke biliknya. Ia menafikan ia telah menanggalkan pakaian SP3 dan melakukan kekerasan jenayah ke kemaluan SP3 sehingga menyebabkan kecederaan parah yang mengakibatkan banyak pendarahan. Perayu ada mengakui ia pergi ke hotel itu bersama SP3 dan Roslan dan bahawa ia yang memandu kereta. Ia menafikan ia tidak bercakap benar apabila ia menyatakan SP3 hendak pergi ke tempat letak kereta semasa beliau hendak beredar dari biliknya. Walau bagaimanapun ia akui ia tahu SP3 tidak ada kereta. Perayu juga menafikan cadangan pihak pendakwaan bahawa ceritanya tentang SP3 ada berbual dengan dua lelaki cina di lobi hotel itu adalah rekaannya. Perayu menyatakan pada malam itu ia tidak tahu SP3 telah berumah tangga.

Di penutup kes pembelaan hakim perbicaraan mendapati pihak pembelaan gagal menimbulkan sebarang keraguan yang munasabah dan bahawa pihak pendakwaan telah membuktikan kesnya hingga tiada keraguan munasabah. Oleh itu ia mendapati perayu bersalah dan mensabitkannya. Ia telah menjatuhkan hukuman pemenjaraan 8 tahun yang berkuatkuasa dari tarikh tangkap, iaitu, 22 November 1999 dan 10 sebatan. Terhadap keputusan itu perayu telah merayu ke Mahkamah Tinggi. Saya telah menolak rayuannya tentang sabitan dan hukuman pemenjaraan tetapi telah mengurangkan hukuman sebatan yang dijatuhkan dari 10 sebatan ke 3 sebatan. Terhadap keputusan itu perayu merayu ke Mahkamah Rayuan.

Dalam hujahnya peguam perayu mendesakkan hakim perbicaraan tersalah dari segi undang-undang dan fakta apabila ia memanggil perayu untuk membela diri kerana pihak pendakwaan gagal membuktikan satu kes prima facie. Ia bertikai pihak pendakwaan gagal membuktikan intipati-intipati penting pertuduhan tersebut. Peguam hujah dalam alasan penghakimannya hakim perbicaraan membuat rujukan kepada Ratanlal & Dhirajlal’s Law of Crimes (Jilid 2) (Edisi ke-24) di ms 1696 berkenaan seksyen 354 Kanun Keseksaan India yang berbunyi:-

3. Ingredients – Before this section may apply, the following essentials must be present:

(i) There must have been assault or use of criminal force on a woman;

(ii) Such assault or use of criminal force must have been made:-

(a) with intention to outrage her modesty; or

(b) with knowledge that her modesty was likely to be outraged.

Setelah merujuk kepada petikan yang diturunkan di atas, hakim perbicaraan menyatakan:-

“Ingredien pertama ‘assault or criminal force’ kedua-duanya telah dibuktikan tanpa sebarang keraguan dengan terdapatnya kecederaan yang teruk dibahagian kemaluan mangsa dan dari rumusan keterangan diatas adalah jelas bahawa kecederaan dialami sewaktu mangsa berada dalam bilik dengan tertuduh dan tertuduh yang melakukan kecederaan itu.”

“Ingredien kedua iaitu semasa melakukan ‘assault’ atau ‘criminal force’ tertuduh perlu ada niat untuk mencabul kehormatan telah terbukti dengan sendirinya melihat kepada dimana kecederaan berlaku. Tiada pertikaian bahawa kemaluan seorang perempuan adalah tempat paling sulit baginya. Dalam buku Ratanlal di ms 1697 dinyatakan demikian

“The Supreme Court has held that when any act done to or in the presence of a woman is clearly suggestive of sex according to the common notions of mankind that act will fall within this section. The essence of a woman’s modesty is her sex. The culpable intention of the accused is the crux of the matter. The reaction of the woman is very relevant, but its absence is not always decisive, as for example, when the accused with a corrupt mind stealthily touches the flesh of a sleeping woman, She may be an idiot, she may be under the spell of anaesthesia, she may be sleeping, she may be unable to appreciate the significance of the act; nevertheless, the offender is punishable under this section.”*

(*State v. Major Singh MR [1967] SC 63: [1967] Cri LJ 1 (SC)).

Peguam bertikai tiada keterangan yang menunjukkan perayu yang menggunakan kekerasan. Bagi menyokong pendirian ini, peguam merujuk kepada keterangan SP3 yang berbunyi:-

“Di Shangrila Hotel kami minum di “The Pub”. Sebelum pergi ke Shangrila Hotel saya tidak tahu OKT menginap di Hotel tersebut. Saya minum 3 gelas minuman. Selain dari minum kami berbual. Saya ada pergi ke tandas semasa minum. Saya tidak tahu siapa yang bayar untuk minuman tersebut. Dari tandas saya balik ke tempat duduk dan teruskan minum dan selepas beberapa minit saya tidak sedarkan diri. Apabila saya sedar saya dapati ada di tengah katil. Saya bangun lebih kurang 4.00 pagi. Masa sedar saya dapati saya tidak berpakaian. Selain dari saya OKT ada duduk di atas sofa dan ia juga telanjang dan sedang hisap rokok. Saya dapatkan towel robe dan pergi ke bilik air untuk pakai pakaian dan saya dapati tiada pakaian – masa pergi ke bilik air saya rasa ada sesuatu jatuh dari bawah saya dan dapati adalah darah.”

Seterusnya peguam merujuk kepada keterangan perayu yang berbunyi:-

“Saya dan Miss Yen dan Roslan pergi ke hotel lobby. Miss Yen dan saya bercakap dalam bahasa Jepun dan Inggeris. Sampai di lobby En Roslan kata hendak balik dan ia balik. Saya ada luggage di bill counter di lobby. Miss Yen ada di tepi saya. Masa itu bukan dalam keadaan berpelukan.

Saya ambil luggage untuk balik ke bilik. Selepas saya ambil beg saya nampak Miss Yen berbual dengan 2 orang lelaki cina. Mereka berbual di lobby. Selepas itu saya balik ke bilik saya. Sebelum pergi ke bilik Miss Yen tidak datang jumpa saya.

Sebelum ambil beg Miss Yen tidak kata hendak pergi kemana. Selepas itu saya balek ke bilik saya. Miss Yen tidak ikut saya balik ke bilik. Saya guna lif. Dalam lif saya rasa mabuk. Saya sampai ke bilik saya dan gunakan kad untuk masuk dalam. Kad ini saya simpan dalam poket.”

Peguam kemudian berhujah ia akui di peringkat kes pendakwaan ia tidak menyoal SP3 tentang “luggage” itu dan juga tentang dua lelaki cina itu. Ia menjelaskan ia berbuat demikian kerana SP3 telah menyatakan beliau tidak sedar diri. Di samping itu ia ingin menjimatkan masa mahkamah dan oleh itu ia tidak menyoal SP3 tentang perkara-perkara itu. Seterusnya peguam merujuk kepada alasan penghakiman hakim perbicaraan yang berbunyi:-

“Ingin saya tambah di sini walaupun keterangan yang dibentangkan tentang perbuatan tertuduh adalah ‘circumstantial evidence’ hanya satu ‘conclusion’ boleh dicapai iaitu tertuduh yang melakukannya. Adalah penting dimana terdapat ‘circumstantial evidence’ hanya satu ‘conclusion’ perlu dicapai seperti dinyatakan dalam kes Ng Hong Kee v. PP [1966] 1 LNS 117; [1967] 1 MLJ 85 oleh Azmi CJ (Malaya):-

‘At the hearing of the appeal Mr Ajaib Singh quite rightly said that the evidence against the appellant was only circumstantial evidence. It was therefore for the trial court to consider whether these bits of evidence are true having regard to all of them whether they force him to come to one conclusion and one conclusion only that the appellant was guilty.’

Berdasarkan perkara diatas adalah kesimpulan saya pendakwa telah membuktikan kes terhadap tertuduh tanpa sebarang keraguan munasabah dan oleh itu saya telah dapati tertuduh bersalah atas tuduhan terhadapnya.”

Peguam bertikai keterangan ikut keadaan (“circumstantial evidence”) itu menjurus ke tiga kemungkinan:-

(i) kemungkinan SP3 dicedera di tempat lain dan mungkin oleh dua lelaki cina itu;

(ii) kemungkinan dari lapuran kimia ada tiga spesimen air mani;

(iii) ada kemungkinan SP3 didatangi haid pada masa itu.

Peguam juga bertikai cerita SP3 tidak disokong oleh keterangan lain dan oleh itu adalah tidak wajar perayu disabit tanpa keterangan menyokong. Oleh itu sabitan hendaklah dibatalkan dan rayuan dibenarkan.

Seksyen 354 Kanun Keseksaan berbunyi:-

Whoever assaults or uses criminal force to any person, intending to outrage or knowing it to be likely that he will thereby outrage the modesty of that person, shall be punished with imprisonment for a term which may extend to ten years, or with fine or with whipping, or with any two of such punishments.

Seksyen 350 Kanun Keseksaan mentafsirkan “kekerasan jenayah” (criminal force) seperti berikut:-

“Whoever intentionally uses force to any person, without that person’s consent, in order to cause the committing of any offence, or intending by the use of such force illegally to cause, or knowing it to be likely that by the use of such force he will illegally cause injury, fear, or annoyance to the person to whom the force is used, is said to use criminal force to that other.”

Setelah saya meneliti dengan terperinci kes pihak pendakwaan, saya berpendapat desakan peguam perayu bahawa pihak pendakwaan gagal mengemukakan kes prima facie tidak berasas. Unsur-unsur kesalahan di bawah seksyen 354 Kanun Keseksaan adalah:-

(1) Tertuduh menyerang atau menggunakan kekerasan jenayah kepada mana-mana orang.

(2) Tertuduh berbuat demikian dengan maksud hendak mencabul atau dengan mengetahui mungkin bahawa ia akan dengan jalan demikian itu mencabul kehormatan orang itu.

Fakta-fakta terkemuka kes pendakwaan yang tidak dipertikaikan oleh pihak pembelaan adalah seperti berikut:-

(i) pada hari dan waktu tersebut SP3 dan perayu bersama Roslan hadir di majlis makan malam tersebut di Hotel Equatorial;

(ii) pada jam lebih kurang 11.00 malam hari yang sama ketiga-tiga mereka telah pergi ke “The Pub” di Hotel Shangri-La; SP3 dan perayu telah minum beberapa gelas minuman keras;

(iii) pada hari yang sama, perayu menginap di hotel itu di bilik No. 1523;

(iv) pada jam lebih kurang 1.00 pagi SP3, seperti dalam keadaan mabuk dan gembira, dan perayu beredar dari “The Pub” dalam keadaan berpelukan.

Dalam keterangannya SP3 menyatakan setelah ia minum beberapa gelas ia tidak sedar diri. Pada jam lebih kurang 4.00 pagi ia tersedar dan mendapati ia berada di atas katil dalam sebuah bilik hotel dalam keadaan tidak berpakaian dan melihat perayu sedang duduk di atas sebuah sofa dalam bilik itu dalam keadaan tidak berpakaian juga. Ia telah kemudiannya pergi ke bilik air bilik itu dan mendapati banyak darah sedang meleleh dari kemaluannya. Setelah membersihkan bahagian kakinya, ia telah meminta perayu pakaiannya dan seterusnya bertanya apa yang beliau telah lakukan kepadanya. Perayu tidak menjawab dan berikutnya ia telah beredar dari bilik itu dan menelefon suaminya untuk menjemputnya. Pada jam lebih kurang 11.30 pagi ia telah mendapatkan rawatan dan pada jam 7.00 malam hari itu telah menjalani pembedahan di hospital Tawakkal. Keterangan doktor yang menjalani pembedahan itu mengesahkan SP3 mengalami kecederaan di bahagian kemaluan dan duburnya dan bahawa kedua-dua bahagian itu hampir tercantum dan ia hampir maut.

Peguam bertikai kes pendakwaan tidak menunjukkan perayu yang mencederakan SP3 dan oleh itu mereka telah gagal mengemukakan satu kes prima facie. Apakah yang dimaksudkan kes prima facie? Dalam Tan Boon Kean v. Public Prosecutor [1995] 3 MLJ 514 Mahkamah Persekutuan telah pun menjelaskan – apa yang dimaksud dengan perkataan-perkataan “prime facie“. Menurut Mahkamah itu, untuk membuktikan suatu kes prime facie, keterangan pihak pendakwaan mesti boleh dipercayai. Suatu kes prime facie adalah kes di mana setiap unsur penting tuduhan itu dibuktikan oleh keterangan yang mencukupi dan melampaui keraguan munasabah dan yang hanya boleh digulingkan dengan mematahkan keterangan yang dikemukakan oleh pihak yang bertentangan, supaya keraguan munasabah ditimbulkan terhadap kes pihak pendakwaan berkenaan kebersalahan tertuduh.

Dalam kes ini, SP3 menyatakan ia tidak sedar diri setelah minum beberapa minuman keras di “The Pub” di hotel itu dan apabila ia tersedar pada jam lebih kurang 4.00 pagi di bilik itu, ia berada dalam keadaan tidak berpakaian langsung dan mendapati perayu sedang duduk di atas sofa dalam bilik itu dalam keadaan telanjang dan sedang merokok. Setelah menyedari darah sedang meleleh dari kemaluannya dan selepas membersihkan dirinya, ia bertanya perayu apa yang beliau buat terhadapnya. Perayu tidak menjawab. Ia telah pakai bajunya dan beredar dari situ. SP7 yang bekerja di “The Pub” mengesahkan SP3 dan perayu telah minum beberapa minuman keras di situ dan pada jam lebih kurang 1.00 pagi telah beredar dari situ dalam keadaan berpeluk-pelukan. SP7 berpendapat SP3 dalam keadaan mabuk dan gembira.

Pada saya, fakta-fakta yang dibincangkan di atas dengan jelas menggambarkan perayu telah membawa SP3 ke biliknya di hotel itu dan berikutnya menggunakan kekerasan jenayah dengan niatuntuk mencabul kehormatan SP3. Ia penghuni bilik itu dan tidak dipertikaikan bilik itu didaftar atas namanya dan bahawa ia telah dibekalkan dengan kunci bilik itu. Hakim perbicaraan telah mendapati pihak pendakwaan telah membuat satu kes prima facie bagi pertuduhan alternatif itu, iaitu, kesalahan di bawah seksyen 354 Kanun Keseksaan dan saya tidak mendapati bagaimana ini dikatakan satu keputusan yang salah. Saya mendapati dapatan hakim perbicaraan dapat disokong oleh keterangan yang dikemukakan di peringkat kes pendakwaan. Laporan polis yang dibuat oleh SP3 (ekshibit P.7) kepada SP15 merupakan keterangan menyokong. Laporan itu berbunyi:-

“Pada 18.11.99 jam 7.30 malam saya hadir satu jamuan makan malam di Equatorial Hotel. Pada 18.11.99 jam 11.00 malam, saya bersama Mr Iwabuchi dan Mr Roslan Yahaya pergi ke sebuah pub di Hotel Shangrila, Jln Sultan Ismail, KL. Kami bertiga minum beberapa gelas arak di pub. Tiba-tiba saya tidak sedar diri. Pada 19.11.99 jam 4.00 pagi, saya tersedar dapati berada di bilik no. 1523 Shangrila Hotel. Saya dan Iwabuchi sahaja dalam bilik dalam keadaan bogel. Saya juga dapati kemaluan saya berdarah. Saya tanya Iwabuchi apa yang dibuat olehnya pada saya. Iwabuchi enggan jawab. Saya kemudian memakai pakaian dan meninggalkan hotel itu. Saya seterus berasa sakit-sakit pada kemaluan. Saya seterusnya mendapat rawatan di Pusat Pakar Tawakal. Doktor mengesahkan saya telah dirogol dan diliwat dengan kasar. Saya juga menjalani operation kerana terdapat koyakkan pada kemaluan dan dubur saya. Saya percayai ia dilakukan oleh Mr Iwabuchi, yang merupakan pelanggan syarikat saya. Inilah laporan saya.”

Laporan polis SP3 merupakan keterangan sokongan berdasarkan seksyen 157 Akta Keterangan 1950 yang memperuntukkan bagi menyokong testimoni seorang saksi, sesuatu pernyataan dahulu yang dibuat olehnya berhubungan dengan fakta yang sama di hadapan mana-mana pihak berkuasa yang kompeten di sisi undang-undang menyiasat fakta itu, boleh dibuktikan. Seksyen itu berbunyi:-

“In order to corroborate the testimony of a witness, any former statement made by him whether written or verbal, on oath, or in ordinary conversation, relating to the same fact at or about the time when the fact took place, or before any authority legally competent to investigate the fact, may be proved.”

Dalam laporannya SP3 menyatakan ia percaya perayu ialah orang yang mencederanya. Hakim perbicaraan membuat dapatan keterangan menunjukkan perayu yang mencederakan SP3 dan saya bersependapat dengannya. Keterangan menunjukkan hanya perayu dan SP3 berada dalam bilik itu pada masa yang material. Dalam Public Prosecutor v. Mardai [1949] 1 LNS 65; [1950] 16 MLJ 33, yang juga melibatkan pertuduhan di bawah seksyen 354 Kanun Keseksaan, Spensor-Wilkinson H berkata:-

“Whilst there is no rule of law in this country that in sexual offences the evidence of the complainant must be corroborated, nevertheless it appears to me, as a matter of common sense, to be unsafe to convict in cases of this kind unless either the evidence of the complainant is unusually, convincing or there is some corroboration of the complainant’s story. It would be sufficient, in my view, if that corroboration consisted only of a subsequent complaint by the complainant herself provided that the statement implicated the accused and was made at the first reasonable opportunity after the commission of the offence.”

Dalam Public Prosecutor v. Teo Eng Chan & Ors [1988] 2 CLJ 793 (Rep); [1988] 1 CLJ 425; [1988] 1 MLJ 156 yang melibatkan kesalahan di bawah seksyen 376 Kanun Keseksaan, iaitu, rogol Coomaraswamy H mendapat pernyataan pengadu yang dibuat kepada doktor yang memeriksanya juga merupakan keterangan sokongan. Hakim itu berkata (di ms 161):-

“… her statement to Dr Chua and her use of the Mandarin equivalent of the words “gang rape” in that statement within 14 hours afterthe events are to my mind adequate corroboration. The number of hours is not by itself important. Kay’s complaint was made as speedily as could reasonably in the circumstances be expected of her.”

Dalam kes dihadapan saya ini, selain dari laporan polis SP3, keterangan Dr Lee Sin Hong (SP14) juga merupakan keterangan menyokong. Dalam keterangannya SP14 ada menyatakan seperti berikut:-

“I collected blood samples for a full bio-chemistry screen AIU, syphillis, hepatatis ‘B’. I found all to be normal. I collected this blood sample because when the patient gave me the history there was an alleged sexual assault. SP3 gave me the history on 20.11.99 in the morning but I cannot remember the time.”

Walau apapun, SP14 telah menjelaskan kecederaan di kemaluan dan dubur SP3 disebabkan oleh mana-mana objek yang merupai batang atau tongkat yang hujungnya tumpul dan berpendapat persetubuhan seksual atau kedatangan haid atau kejatuhan tidak mungkin akan mengakibatkan kecederaan yang SP3 mengalami. Keterangan SP14 dengan jelas menunjukkan kekerasan jenayah telah digunakan ke atas SP3.

Di samping itu, SP7 menyatakan SP3 dan perayu telah beredar dari ‘The Pub” pada jam lebih kurang 1.00 pagi, iaitu pada 19 November 1999. SP16 pula mengesahkan kali terakhir “keycard” bagi bilik No. 1523 itu digunakan adalah pada 19 November 1999 jam 1.00 pagi. Pada saya, keterangan ini, yang merupakan keterangan menyokong, menggambarkan bahawa perayu telah pulang ke biliknya pada jam lebih kurang 1.00 pagi.

Di lihat secara keseluruhannya, keterangan yang dikemukakan di penutup kes pendakwaan dengan jelas menunjukkan pendakwa telah membuat suatu kes prima facie terhadap perayu, iaitu, bahawa ia telah membawa SP3 ke biliknya dan menggunakan kekerasan jenayah kepada SP3 dan bahawa ia berbuat demikian dengan maksud hendak mencabul kehormatan SP3. Mendasarkan apa yang dibincang di atas, saya mendapat tidak ada keraguan langsung dalam kes pendakwaan. Kesimpulannya saya mendapat keputusan hakim perbicaraan memanggil perayu untuk masuk pembelaanya adalah tepat dan betul berdasarkan keterangan yang dikemukakan di penutup kes pendakwaan. Saya tidak dapat mengesan apa-apa kecacatan.

Dalam pembelaannya perayu akui ia hadir di majlis makan malam tersebut dan selepas majlis bersurai ia telah pergi ke “The Pub” di hotel itu bersama SP3 dan Roslan. Ia mengakui SP3 dan beliau telah minum beberapa minuman keras dan telah beredar dari situ pada jam di antara 12.30 pagi dan 12.45 pagi. Ia juga mengakui ia berpelukan dengan SP3 semasa mereka beredar dari situ. Walau bagaimanapun ia menyatakan ia naik ke bilik seorang diri pada jam lebih kurang 1.00 pagi selepas melihat SP3 berbual dengan dua lelaki cina di lobi hotel itu. Perayu menyatakan ia tidak pasti sama ada pintu biliknya ditutup atau tidak sebelum ia tidur. Ia mendesakkan ia tidur secara berbogel.

Berikutnya pada jam lebih kurang 3.30 pagi ia terjaga dan melihat ada seorang sedang berdiri didepannya. Ia rasa terkejut dan telah pasangkan lampu dan seterusnya melihat SP3 ditepinya dalam keadaan bogel. Ia cuba kejutkan SP3 dan selepas itu telah duduk di atas sofa di bilik itu dan merokok. SP3 telah kemudiannya terjaga, dan ia telah menyoal beliau tentang kehadirannya di bilik itu. SP3 memaklumkan pada jam 3.00 pagi beliau pergi minum bersama dua lelaki cina dan oleh kerana sudah lewat, beliau telah datang ke biliknya dan mendapati pintu terbuka. Oleh kerana beliau rasa panas dan bajunya kotor dengan muntah, ia telah menanggalkan pakaiannya dan tidur di atas katil itu. SP3 kemudiannya pergi ke bilik air dan ia melihat ada darah di atas katil. Berikutnya SP3 telah pakai bajunya dan beredar dari situ. Sebelum ia beredar beliau meminta maaf kerana telah memasuki bilik itu tanpa kebenaran. SP3 berkata ia telah meletakkan keretanya di tempat letak kereta dan mendesakkan ia boleh pergi seorang diri. Perayu menafikan ia ada mencederakan SP3 dan mendesakkan SP3 telah tidur disebelahnya dalam keadaan bogel tanpa pengetahuannya.

Semasa ia diperiksa balas, perayu akui ia berpelukan dengan SP3 semasa mereka beredar dari “The Pub” kerana ia telah minum banyak. Ia menyatakan ia tidak tahu apa mereka buat selepas itu ia tidak bersetuju pintu biliknya boleh tutup dengan sendiri selepas ia masuk. Perayu kemudiannya menafikan ia ada melihat seseorang berdiri didepannya semasa ia terjaga pada jam iebih kurang 3.30 pagi. Pada masa itu ia melihat SP3 sedang tidur disebelahnya dan tidak berpakaian. Ia akui ia pergi ke hotel itu bersama SP3 dan Roslan dengan menaiki keretanya tetapi mendesakkan ia bercakap benar apabila ia menyata SP3 memaklumkan beliau hendak pergi ke tempat letak kereta sebelum beliau beredar dari biliknya.

Di penutup kes pembelaan, hakim perbicaraan mendapati pihak pembelaan gagal menimbulkan sebarang keraguan yang munsabahah dan bahawa pihak pendakwaan telah membuktikan kesnya hingga tiada keraguan munasabah. Oleh itu ia mendapati perayu bersalah dan mensabitkannya. Saya tidak dapat mengesan apa-apa kecacatan dalam keputusan hakim perbicaraan. Pada saya, alasan penghakimannya pada keseluruhan nya menunjukkan ia mengetahui dan memahami setiap unsur penting tuduhan hendaklah dibuktikan oleh keterangan yang mencukupi dan melampui keraguan munasabah. Saya mendapati adalah jelas kesemua unsur-unsur bagi kesalahan menggunakan kekerasan jenayah dengan niat untuk mencabul kehormatan seperti diperuntukan di bawah seksyen 354 Kanun Keseksaan telahpun dibuktikan melampaui keraguan munasabah, iaitu:-

(i) pada 19 November 1999 perayu telah menggunakan kekerasan jenayah kepada SP3;

(ii) perayu berbuat demikian dengan maksud hendak mencabuli kehormatan SP3.

Dalam State of Punjab v. Major Singh AIR [1967] SC 63, AK Sarkar CJ berkata (di ms 65):

“Intention and knowledge are of course states of mind. They are nonetheless facts which can be proved. They cannot be proved by direct evidence. They have to be inferred from the circumstances of each case. Such an inference, one way or the other, can only be made if a reasonable man would, on the facts of the case, make it. The question in each case must, in my opinion, be: will a reasonable man think that the act was done with the intention of outraging the modesty of the woman or with knowledge that it was likely to do so? The test of the outrage of modesty must, therefore, be whether a reasonable man will think that the act of theoffender was intended to or was known to be likely to outrage the modesty of the woman. In considering the question, he must imagine the woman to be a reasonable woman and keep in view all circumstances concerning her, such as, her station and way of life and the known notions of modesty of such a woman. The expression ‘outrage her modesty’ must be read with the words ‘intending to or knowing it to be likely that he will’. So read, it would appear that though the modesty to be considered is of the woman concerned, the word ‘her’ was not used to indicate her reaction. Read all together, the words indicate an act done with the intention or knowledge that it was likely to outrage the woman’s modesty, the emphasis being on the intention and knowledge.”

Perkataan “woman” yang terdapat dalam seksyen 354 Kanun Keseksaan India tidak wujud dalam Kanun Keseksaan kita yang mana terdapat perkataan-perkataan “any person”. Walau pun demikian, pendapat AK Sarkar CJ boleh di beri pertimbangan sewajarnya. Jika saya tidak salah, perkataan “kehormatan” (“modesty”) tidak ditafsirkan dalam Kanun Keseksaan. Keadaannya adalah serupa dalam Kanun Keseksaan India. Dalam Rupan Deol Bajaj v. KPS Gill [1996] Cr LJ 381, seorang pegawai polis telah didapati melakukan kesalahan yang sama. Mengenai perkataan “kehormatan” (“modesty”), MK Mukherjee J berpendapat seperti berikut (di ms 385):-

“Since the word ‘modesty’ has not been defined in the Indian Penal Code we may profitably look into its dictionary meaning. According to Shorter Oxford English Dictionary (Third Edition) modesty is the quality of being modest and in relation to woman means “womanly propriety of behaviour; scrupulous chastity of thought, speech and conduct.” The word ‘modest’ in relation to woman is defined in the above dictionary as “decorous in manner and conduct; not forward or lewd; shameful”.

Saya mendapati inferens boleh dibuat bahawa kecederaan yang dialami oleh SP3 dengan jelas menunjukkan perayu telah dengan sengaja menggunakan kekerasan kepada SP3 dengan tiada kerelaannya dengan mengetahui mungkin bahawa dengan menggunakan kekerasan itu ia akan menyebakan kecederaan kepada SP3. Saya berpendapat kecederaan itu dengan jelas menggambarkan ia mengetahui bahawa dengan menggunakan kekerasan sedemikian ia akan mencabul kehormatan SP3. Pembelaan perayu berbentuk penafian sahaja. Ia menyatakan ia naik ke biliknya seorang diri dan tidak dapat pasti sama ada ia telah menutup pintu biliknya dengan sempurna. Ia mendakwa ia tinggalkan SP3 di lobi hotel itu sebelum ia naik ke biliknya memandangkan SP3 sedang berbual dengan dua lelaki cina. Ia mendakwa SP3 memberitahunya ia telah pergi minum di tempat lain dengan dua lelaki cina itu pada jam 3.00 pagi. Ia pula mendesakkan apabila ia tersedar pada jam 3.30 pagi, ia mendapati SP3 berada ditepinya atas katil dan tidak berpakaian. Kewujudan dua lelaki cina itu hanya ditimbulkan di peringkat pembelaan dan hanya dicadangkan di peringkat kes pembelaan. Mengenai ini, peguam ada bertikai ia tidak ditimbulkan semasa SP3 diperiksa balas olehnya kerana SP3 tidak sedar pada masa yang material.

Mengenai isu bahawa SP3 tidak sedar pada masa yang material, perayu masih boleh disabitkan bagi kesalahan ini. Dalam State of Punjab v. Major Singh, supra, AK Sarkar CJ berkata (di ms 66):

If it is proved that criminal force was used on a sleeping woman with intent to outrage her modesty, then the fact that she does not wake up nor feel that her modesty had been outraged would be no defence to the person doing the act. The woman’s reaction would be irrelevant in deciding the question of guilt.”

Dalam Mat v. Public Prosecutor [1963] 1 LNS 82; [1963] 29 MLJ 263, Suffian H berkata (di ms 263-264):

“The correct law for Magistrates to apply is as follows. If you accept the explanation given by or on behalf of the accused, you must of course acquit. But this does not entitle you to convict if you do not believe that explanation, for he is still entitled to an acquittal if it raises in your mind a reasonable doubt as to his guilt, as the onus of proving his guilt lies throughout on the prosecution, if upon the whole evidence you are left in a real state of doubt, the prosecution has failed to satisfy the onus of proof which lies upon it.”

Di akhir kes pembelaan hakim perbicaraan mendapati kes pembelaan tidak membawa atau menimbulkan apa-apa keraguan terhadap kes pendakwaan. Ia berpuas hati melebihi keraguan munasabah bahawa perayu telah melakukan kesalahan itu. Saya tidak dapat mengesan apa-apa kecacatan dalam keputusannya.

Tentang hukuman, seksyen 354 Kanun Keseksaan memperuntukkan barang siapa yang didapati menggunakan kekerasan jenayah kepada mana-mana orang dengan maksud hendak mencabul kehormatan orang itu hendaklah disiksa dengan penjara selama tempoh yang boleh sampai 10 tahun, atau dengan denda, atau dengan sebat, atau dengan mana-mana dua daripada siksaan-siksaan itu. Saya mendapat hukuman penjara selama 8 tahun yang djatuhkan ke atas perayu oleh hakim perbicaraan adalah tepat dan wajar dan oleh itu saya teiah mengesahkannya. Walau bagaimanapun saya mendapat sebatan sebanyak 10 kali yang dikenakan adalah tidak bersesuaian memandangkan perayu adalah pesalah pertama dan oleh itu saya telah kurangkannya kepada 3 sebatan.