IN THE FEDERAL
COURT OF MALAYSIA
AT
PUTRAJAYA
(APPELLATE
DIVISION)
CIVIL APPEAL NO. 01-4-2004(W)
MAJLIS
PERBANDARAN AMPANG JAYA … APPELLANT
STEVEN PHOA CHENG LOON & 81 OTHERS … RESPONDENTS
Corum: STEVE SHIM LIP KIONG, HBSS
ABDUL HAMID
BIN HJ. MOHAMAD, HMP
ARIFIN BIN
ZAKARIA, HMP
1.
The Issues
There are two appeals before us –
one, an appeal proper by the appellant, Majlis Perbandaran Ampang Jaya (MPAJ)
and the other, a cross-appeal by the respondents. More specifically, the appellant’s appeal is
directed at the decision of the Court of Appeal in affirming the High Court’s
finding that the appellant was 15% liable to the respondents for negligence and
nuisance. And the respondents’
cross-appeal is aimed at the Court of Appeal’s decision that their cause of
action against the appellant for alleged post-collapse liability lay in the
area of public law and not private law.
In effect and in substance, the appeal and cross-appeal can be said to
relate to issues encapsulated in the questions upon which leave to appeal was
granted by this Court. These questions
are postulated as follows:-
1.
Where a
plaintiff sustains damage and alleges negligence against various defendants and
the tribunal of fact ascribes negligence to the various defendants and where
there is a clear finding that the causa causans of the plaintiff’s
damage is the negligence of a particular defendant, whether in that
circumstance, the other defendants who are guilty of certain negligent acts but
whose negligent acts are not held to be the causa causans can be held
liable to the plaintiff as well.
2.
Whether
section 95(2) of the Street, Drainage & Building Act, 1974 (Act 133) is
wide enough to provide immunity to a local authority in approving the diversion
of a stream and in failing to detect any damage or defect in the building and
drainage plans relating to the development submitted to the local authority by
the architect and/or the engineer on behalf of the developer.
3.
Whether
pure economic loss is recoverable under our Malaysian jurisprudence with
reference to (a) negligence and (b) nuisance.
4.
In a case
involving different acts of negligence by multiple defendants committed at
different times, whether those defendants are joint tortfeasors.
5.
Whether
the Court of Appeal erred in providing a distinction between private law and
public law when finding that the appellant was not responsible to the 1st
to 73rd respondents for the appellant’s acts and omissions as
determined by the High Court following the collapse of Block 1 of Highland
Towers.
2. The
Background Facts
The
factual matrix relevant to the issues can be briefly stated. The
3. Causa
Causans
“Mr. Abraham in his submission argues that the plaintiffs must prove that the acts and/or omissions of the 5th defendant was or were the effective cause or the causa causans of the collapse of Block 1 leading to the forced evacuation of the plaintiffs from Blocks 2 and 3. To decide on this, reference must be made to my finding on the cause of the collapse of Block 1. Since it is already decided that it was due to a landslide caused primarily by water which emanated from the damage pipe culvert and the inadequate and unattended drains on the 5th defendant’s land, then the plaintiffs have sufficiently proved the causa causans of the collapse of Block 1 leading to the forced evacuation of the plaintiffs from Blocks 2 and 3, was due to the acts and/or omissions of the defendants in not maintaining those watercourses.”
The 5th defendant above refers to
AMFB. The expression “causa causans”
merely means a cause that causes: (Smith, Hogg & Company Ltd. v Black
Sea & Baltic General Insurance Co. Ltd (1940) AC 997, 1003). There may be more than one cause that causes
a particular injury. From the passage
cited above, it would appear that Mr. Abraham was of the view that causa
causans merely meant an effective cause.
It has been held that such an expression should be avoided as the issue
of causation does not necessarily turn upon it:
(see Environment Agency (Formerly
National Rivers Authority) v. Empress Car Co. (Abertillery) Ltd (1999) 2 AC 23,
29). Causation is a matter to be determined by common sense and what the law
regards as fair, just and reasonable in the circumstances of a particular case
(see Fairchild (suing on her own
behalf) etc v. Glenhaven Funeral Services Ltd & Ors, etc. (2002) 3 WLR 89;
March v E & MH Stramare Pty Ltd & Anor (1991) 99ALR 423, 429). The
relevant question is whether the acts and/or omissions of a particular
defendant made a material contribution to the harm suffered by the plaintiff
(see Bonnington Castings v Wardlaw
(1956) AC 613, 620, 623; Nicholsons & Ors v. Atlas Steel Foundary &
Engineering Co. Ltd (1957) 1 WLR 631, 624; Fairchild (suing on her own behalf)
etc v. Glenhaven Funeral Services (supra); Chappel v Hart (1998) 156 ALR 517,
524-524).
When all the relevant authorities are examined in their
proper perspective, the answer to the first question must be in the
affirmative.
4.
Scope of Section 95(2) of Act 133
The
second question postulated concerns the scope of s. 95(2) of the Street,
Drainage & Building Act, 1974 (Act 133) when examined in the context of the
factual circumstances of this case.
Here, the learned trial judge found that the landslide was caused by
soil on the hill slope being saturated with excessive water; that this water
triggered the failure of the high retaining wall within the
“As a local authority, the 4th
defendant owes a duty or care to the plaintiffs to use reasonable care, skill
and diligence to ensure that the hillslope and the drainage thereon were
properly accommodated before approving building or other related plans and
during construction stage, to comply with and to ensure the implementation of
the drainage system. Then when CFs were
applied for, there should be proper and thorough inspection on whether the
buildings so built, were safe in all aspect and not just confined to the
structure. And after the
The 4th
defendant alluded above refers to MPAJ.
There is ample evidence to show that MPAJ and/or its predecessor Majlis
Daerah Gombak had required a proper drainage system to be implemented on the
hillslope before and during the construction of the
On the need by MPAJ
and/or its predecessor to maintain the East stream, the learned trial judge
said this:-
“But under ss. 53
& 54 of the Street, Drainage & Building Act, 1974, the 4th
defendant, being the local authority of the area, has a duty to maintain
‘watercourses’ within its jurisdiction.
And ‘watercourses’ under ss. 53 & 54 of the Street, Drainage &
Building Act, 1974 as defined in the case of Azizah Zainal Abidin & Ors
v Dato’ Bandar Kuala Lumpur (supra), include streams and rivers. Thus, possessed of this duty, Mr. Navaratnam
alleges that the 4th defendant has breached its duty of care when it
failed and/or neglected and is still failing and/or neglecting to maintain this
stream, which was the major factor that caused the collapse of Block 1 and is
an important element in ensuring the instability of the slope behind Blocks 2
and 3 at the present moment.
I
am much convinced by this argument above and based on the facts as disclosed, I
find such a duty of care exists and this duty has been breached by the
defendant resulting in damages to the plaintiffs.
From the facts as found by the learned trial judge, it seems evident
that the need by MPAJ and/or its predecessor Majlis Daerah Gombak to divert the
East stream must have been intended to resolve the drainage problems in the
affected areas around the hill slope behind the Highland Towers. There is no dispute by the respondents that
if the drainage was implemented in accordance with the P34 plan, the
possibility of a land slide causing the collapse of Block 1 would not have
occurred. Having required the diversion
of the East stream, as in the P34 plan, it would have been reasonable to expect
the local authority (in this case MPAJ and/or its predecessor) to ensure its
proper maintenance. This would have
entailed a duty on the part of the said local authority to conduct regular
inspections so as to ensure its proper implementation of the said
diversion. The learned trial judge found
this to be wanting. Not surprisingly, he
found support in the respondents’ contention that MPAJ and/or its predecessor
had breached its duty of care in failing and/or neglecting to maintain the East
stream, which according to him, “was a major factor that caused the collapse of
Block 1 and an important element in ensuring the instability of the slope
behind Blocks 2 and 3”.
Now, although the
learned trial judge held that MPAJ and/or its predecessor to be negligent, he
took the view that they were protected from liability by virtue of s. 95(2) of
Act 133. He felt that the immunity provided
under the said section was wide enough to embrace the alleged danger created by
MPAJ
and/or its predecessor in diverting the East stream. On appeal, the Court of Appeal took a
different approach. It said as follows:-
“Mr.
Navaratnan learned counsel for the plaintiffs has submitted that the section
does not apply to the facts of the present instance. For, this is a case which the 4th
defendant directed the carrying out of certain works thereby creating a danger
to the plaintiffs’ property. Counsel is
referring to the requirement by the 4th defendant that the East
stream be diverted from its natural course.
This is a fact as found by the trial court and amply borne out by the
evidence, the relevant parts of which were read to us. Accordingly, this is not merely a case of –
to borrow the language of the section – inspection or approval of building or
other works or the plans thereof. This
is a case where a danger was expressly created at the instance of the 4th
defendant. We are therefore in agreement
with learned counsel for the plaintiffs that the judge went wrong on the
indemnity point.”
The Court of Appeal went on to extrapolate
on the common law duty of care a local authority such as the 4th
defendant owed to a third party citing a number of cases including Kane
v New Forest District Council (2001) 3 AllER 914. The
Court then states:-
“If
the local authority in Kane V
New Forest District Council (supra) could
not wash its hands off the danger in the footpath it required to be
constructed, we are unable to see how the 4th defendant could
possibly escape liability in the present case of requiring the diversion of the
East stream. Accordingly, we set aside
the indemnity granted to the 4th defendant by the trial judge. The consequence is that the 4th
defendant is liable to the plaintiffs in the tort of negligence. We would add for good measure that the kind
of harm that was foreseeable by the 5th defendant was equally
foreseeable by the 4th defendant.
Upon the evidence on record and applying it to the relevant principles
already referred to earlier in this judgment, it is clear that the 4th
defendant must as a reasonable local authority have foreseen the danger created
by diverting the East stream would probably cause a landslide of the kind that
happened and that in such event, resultant harm, including financial loss of
the kind suffered by the plaintiffs, would occur. We would in the circumstances uphold the
apportionment of liability as against the 4th defendant.”
Essentially, the position taken by the Court
of Appeal is that the appellant (who is a local authority) had created a danger
by requiring or approving the diversion of the East stream on the hill slope
behind
The
State Authority, local authority and any public officer or employee of the
local authority shall not be subject to any action, claim, liability or demand
whatsoever arising out of any building or other works carried out in accordance
with the provision of this Act or any by-laws made thereunder or by reason of
the fact that such building works or plans thereof are subject to inspection
and approval by the State Authority, local authority or such public officer or
employee of the State Authority or the local authority and nothing in this Act
or any by-laws made thereunder shall make it obligatory for the State Authority
or the local authority to inspect any building, building works or materials or
the site of any proposed building to ascertain that the provisions of this Act
or any by-laws made thereunder are complied with or that plans, certificates
and notices submitted to him are accurate.”
In this connection, counsel for the respondents has submitted that s.
95(2) does not give local authorities any power to act negligently or create a
nuisance. He contends that as an
essential principle of statutory interpretation, statutory powers granted to
local authorities must be exercised without negligence and without committing
avoidable nuisances, citing in support cases such as David
Geddis v. Proprietors of Bana Reservoir (1878) 3AC 430, 447; Allen v. Gulf Oil
Refining Ltd (1981) AC 1004, 1011; Capital & Countries Plc. V. Hampshire
County Council (1997) GB. 1004, 1045. As a
general principle, I agree that is the correct approach. However, it has been held that although a
statute should be interpreted as far as possible to ensure it does not permit a
tortfeasor to escape the wrongful consequences of his acts and omissions,
nevertheless a statutory body can be granted immunity from liability for such
consequences if and only if the words granting such immunity are clear and
explicit: (see Boulting v. Association of Cinematograph,
Television & Allied Technicians (1963) 2 QB 606, 643-644; Capital &
Countries Plc. V. Hampshire County Council (supra). The issue before us is whether s. 95(2)
grants such an immunity, Here, the
respondents have taken the position that when the factual matrix of this case
is examined in the context of s. 95(2), they do not afford MPAJ and/or its
predecessor any protection whatsoever.
Counsel for the respondents contends that there are 3 limbs to s.
95(2). According to him, the first limb
only protects local authorities from liability for building or other works
carried out in accordance with Act 133; the second limb merely states that local
authorities shall not be under any liability simply because building works and
building plans are subject to inspection and approval; and the third limb
states that local authorities shall not be under any obligation to inspect
buildings and building works to ascertain that they comply with Act 133.
Counsel for the
respondents seems to have placed much emphasis on the first limb in s. 95(2),
contending that MPAJ and/or its predecessor, by creating a danger, had failed
to carry out its duty in accordance with Act 133, drawing particular attention
to ss. 54 & 55 thereof and therefore not subject to any protection under
the said s. 95(2). With respect this
argument is quite misconceived. As I
indicated earlier, the Court of Appeal had accepted the factual finding of the
learned trial judge that MPAJ and/or its predecessor had created a danger when
it required or approved the diversion of the East stream and subsequently
failing or neglecting to maintain the said diversion or to ensure its proper
maintenance. As the learned trial judge
has pointed out, proper maintenance would have involved regular and effective
inspections to be conducted by MPAJ and/or its predecessor. He held that such failure or neglect
constituted a breach of the duty of care on the part of MPAJ and/or its
predecessor. In effect, the finding of
the learned trial judge as to the creation of the danger in the diversion of
the East stream relates essentially to approval and inspection by MPAJ and/or
its predecessor. Thus, when the facts as
found by the learned trial judge which were accepted by the Court of Appeal are
examined in the context of the specific provision under s. 95(2), in particular
the second and third limbs thereof, they fall squarely within its ambit. In my view, MPAJ and/or its predecessor
Majlis Daerah Gombak are fully protected from liability under the said
section. For the reasons stated, the
Court of Appeal has therefore erred in holding otherwise. It is in this context that the second
question postulated has to be answered.
5.
Pure Economic Loss
The third question
postulated the consideration of whether pure economic loss is recoverable under
the Malaysian jurisprudence in negligence and nuisance. In the law of negligence, there is no
immutable rule that pure economic loss is not recoverable. All major Commonwealth jurisdictions
recognize that pure economic loss is recoverable in negligence. Under English law, the general duty of care
test enunciated in Caparo Industries Plc. V. Dickman (1990) 2 AC 605 is applicable to all negligence claims,
including claims for pure economic loss.
Pursuant to this test, 3 questions have to be addressed, namely, whether
the damage suffered by the plaintiff is reasonably foreseeable; whether there
is a relationship of proximity between the plaintiff and defendant; and whether
it is fair and reasonable that the defendant should owe the plaintiff a duty of
care. The English courts have adopted a
dual approach in applying the Caparo test (see
Marc Rich
& Co. AG v Bishop Marine Co. Ltd (1996) 1 AC 211). The
first concerns the “categorization approach”.
Here, the English courts would determine if the plaintiff’s claim falls
into a recognized category of liability.
In cases of pure economic loss, the recognized categories include the following
scenarios i.e. (1) where a defendant has assumed a particular responsibility
towards the plaintiff. For example, in White v. Jones (1995) 2 AC
207, where a
solicitor was found to have assumed a responsibility towards the beneficiary
under a will when drafting the will pursuant to a testator’s instructions; (2)
where a defendant has exposed a plaintiff to a particular danger (see Harris v. Evans (1998) 1 WLR
1285) and
(3) where there is a recognized legal relationship between the plaintiff and
defendant. For example, in Phelps v. Hillingdon London
Borough Council (2001) 2 AC 6019,667, it was found that a teacher-pupil relationship
might place a teacher under a duty of care not to cause pure economic loss by
teaching pupils the wrong syllabus. The
second concerns the “open-ended approach”.
Here, if the facts of a particular case do not come within a recognized
category of liability, a court could go further to look at the facts closely to
determine if a duty of care should nevertheless be owed by the defendant to the
plaintiff. Recent statements by the
English courts confirm that the “open-ended approach” can be used to recognize
duties of care in new situations: (see Spring v. Guardian Assurance Plc. (1985) 2 AC
295.)
In the instant case, the Court of Appeal held that under
the Atkinian doctrine, loss of any type or description is recoverable provided
that it is reasonably foreseeable; that it is not the nature of the damage
itself, whether physical or pure financial loss, that is determinative of remoteness
and the critical question is whether the scope of the duty of care in the
circumstances of the case is such as to embrace damage of the kind that the
plaintiff claims to have sustained, whether it be pure economic loss or injury
to person or property. The Court of
Appeal relied on the English case of Murphy v. Brentwood District Council (1991) 1 AC 398.
Now, Murphy v.
(1) That Donoghue v. Stevenson (1932)
AC 562 only
dealt with the situation whether a defective chattel or building caused
personal injury or harm to property that was distinct and separate from the
defective chattel itself. If a plaintiff
sought recovery for the cost of repairing or replacing a defective chattel or
building before it caused personal injury or damage to other property, such a
claim would be one for pure economic loss;
(2) That recovery for
pure economic loss in the law of negligence was restricted to circumstances
where there was reliance on another person’s advice or conduct as was the case
in Hedley
Byrne & Co. v. Heller & Partners Ltd. (1964) AC 465;
(3) That a builder was not
liable for the pure economic loss of correcting defects in a building before
they caused harm to other property or personal injury unless reliance in the
sense envisaged in Hedley Byrne was shown to exist. Similarly, the defendant council could not be
made liable for the cost of correcting such defects;
(4) That it was not
fair, just and reasonable to recognize liability on the part of the defendant
council for failing to detect errors in buildings in the course of exercising
its statutory powers of inspection under the Defective Premises Act, 1972 (UK).
It is
perhaps important to note, from the analysis of the various speeches of the law
Lords in Murphy
v. Brentwood (supra)
that pure economic loss is recoverable in negligence in English law on the two
alternate bases, namely the “categorization approach” and the “open-ended
approach” alluded to earlier. I may add
that the two approaches do not exist in strict water tight compartments. It is possible for them to overlap: (see Kane v. New Forest District
Council (supra).
In
Having had the benefit of reading the
various authorities on this subject, I am more inclined to accept the positions
taken by the courts in
The Court of Appeal in the instant
case is correct in adopting the view expressed by Lord Oliver in Murphy v. Brentwood (supra) that the critical question is not the nature
of the damage itself, whether physical or pecuniary, but whether the scope of
the duty of care in the circumstances of the case is such as to embrace damage
of the kind which the plaintiff claims to have sustained. The decision in Murphy involves, as I have mentioned earlier, the
application of the Caparo test
which takes into account the elements of foreseeability, proximity and the
additional requirement of justice, fairness and reasonableness.
Now, the exposition above relates to
pure economic loss in the law of negligence.
What is the position in the law of nuisance? Here, I need only rely on the speech of Lord
Lloyd in Hunter
v. Canary Wharf Ltd (1997) 2 WLR 684, a case also cited with approval by the Court of
Appeal in the instant case. Therein,
Lord Lloyd has said this:-
“It has been said that an actionable nuisance
is incapable of exact definition. But
the essence of nuisance is easy enough to identify, and it is the same in all
three cases of private nuisance, namely, interference with land or the
enjoyment of land. In the case of
nuisances within class (1) or (2), the measure of damages is, as I have said,
the diminution of the value of the land.
Exactly the same should be true of nuisances within class (3). There is no difference in principle. The effect of smoke from a neighbouring
factory is to reduce the value of the land.
There may be no diminution in the market value. But there will certainly be loss of amenity
value so long as the nuisance lasts. If
that is the right approach, then the reduction in amenity value is the same
whether the land is recognized by the family man or the bachelor.”
The
three classes of private nuisance referred to by Lord Lloyd are (1) nuisance by
encroachment on a neighbour’s land; (2) nuisance by direct physical injury to a
neighbour’s land; and (3) nuisance by interference with a neighbour’s quiet
enjoyment of his land. On the authority
in Hunter v
Canary Wharf Ltd (supra), which
I accept to be correct, it seems clear that pure economic loss is recoverable
for any of the forms of nuisance recognized by law. Indeed, the fact that damages for diminution
in value in land are recoverable in nuisance has been recognized by the Federal
Court in Liew
Choy Hung v. Shah Alam Properties Sdn Bhd. (1997) 2 MLJ 309.
Before us, both the appellant and
respondents are on common ground that recovery for pure economic loss is
permitted in the law of negligence.
However, they disagree on their application to the facts of the instant
case. For the respondents, it is
submitted that they should be allowed to recover economic loss against MPAJ
and/or its predecessor Majlis Daerah Gombak.
They advanced the following grounds:
First, the danger posed by the concept of diverting the East stream
across the hill slope behind
6.
Joint Tortfeasors
The
issue here is whether defendants are joint tortfeasors in a case involving
different acts of negligence by multiple defendants committed at different
times. In my view, the answer to this
question can be found in the Supreme Court case of Malaysian National
Insurance Sdn Bhd v. Lim Tiok (1997) 2 CLJ 351, 375 wherein Edgar Joseph Jr. FCJ said:-
“To recapitulate, at common law, if each of several persons, not acting
in concert, commits a tort against another person substantially
contemporaneously and causing the same or indivisible damage, each tortfeasor
is liable for these same damages.”
Counsel for the respondents has
cast doubt on the correctness of this proposition which adopts the stand taken
by Choor Singh, J. in Oli Mohamed v. Keith Murphy & Anor (1969) 2 MLJ
244, 245, who in turn cited in support the following passage of a speech by
Delvin, LJ in Dingle v. Associated Newspapers Ltd. & Ors (1961) 2 QB 162:-
“… Where injury has been done to the
plaintiff and the injury is indivisible, any tortfeasor whose act has been a
proximate cause of the injury, must compensate for the whole of it. As between the plaintiff and the defendant,
it is immaterial that there were others whose acts also have been a cause of
the injury and it does not matter whether those others have or have not a good
defence. These factors would be relevant in a claim between tortfeasors for
contribution, but the plaintiff is not concerned with that; he can obtain
judgment for total compensation from anyone whose act has been a cause of his
injury. If there are more than one of
such persons, it is immaterial to the plaintiff whether they are joint
tortfeasors or not. If four men, acting
severally and not in concert, strike the plaintiff one after another and as a
result of his injuries he suffers shock and is detained in hospital and loses a
month’s wages, each wrong-doer is liable to compensate for the whole loss of
earnings. If there were four distinct
physical injuries, each man would be liable only for the consequences peculiar
to the injury he inflicted, but in the example I have given, the loss of
earnings is one injury caused in part by all the four defendants. It is essential for this purpose that the
loss should be one and indivisible; whether it is so or not is a matter of fact
and not a matter of law ….”
According to counsel, Choor Singh J., in citing the
above passage, has erred in suggesting that the acts of different defendants
must be sufficiently contemporaneous before there can be concurrent liability
in tort. He submits that the passage
cited above shows clearly that the imposition of joint and several liability on
defendants as concurrent tortfeasors is not premised on the contemporaniety of
their actions but is determined by deciding whether their separate actions
caused the plaintiff indivisible harm.
With respect, counsel is misconceived.
In my view, the first sentence in that passage is sufficiently
clear. I would repeat it for emphasis –
“where the injury has been done to the plaintiff and the injury is indivisible,
any tortfeasor whose act has been a proximate cause of the injury, must
compensate for the whole of it.” When
the words underscored above are examined in their proper perspective,
particularly in the light of the illustration given in the same passage, there
can be little doubt that the statement of Edgar Joseph Jr. FCJ represents the
correct reflection of the position taken by Lord Delvin in Dingle. In the circumstances, the attempt by counsel
for the respondents to revisit Malaysian National Insurance (supra), in
terms of his proposition, has no basis whatsoever.
7.
Private Law and Public Law
The fifth question seeks a consideration of whether the Court of Appeal
has erred in holding that the respondents’ cause of action lay in the area of
public law and not private law. The
complaint of the respondents seems to be directed at the following passage of
its judgment:-
“Now, assuming
that there was a duty on the 4th defendant to act in a particular
manner towards the property of the plaintiff’s post collapse, such duty must
find its expression in public law and not private law. Accordingly, if there had been a failure on
the part of the 4th defendant to do or not to do something as a
public authority, the proper method is to proceed by way of an application for
judicial review – see Trustees of Dennis Rye pension Fund &
Anor v. Sheffield City Council (1997) 4 AllER 749. Further, the substance of the order made
against the 4th defendant appears to demand constant supervision and
though this may no longer be a complete bar to the grant of a mandatory order,
it is nevertheless a relevant consideration that must be kept in the forefront
of the judicial mind. In the
circumstances of this case, we are unable to see how such a duty as alleged to
exist may be enforced in private law proceedings. It follows that this part of the judge’s
judgment cannot stand. It is set aside.”
I think the brief facts
in Trustee
of Dennis Rye Pension Fund
relied on by the Court of Appeal ought to be stated. There, the plaintiffs were served with a
repair notice under the Housing Act (UK)
requiring work to be carried out to certain houses to render them fit for human
habitation. They then applied to the
Sheffield City Council for improvement grants under the Local Government &
Housing Act. The council approved the application but
subsequently refused to pay the grants on the grounds, inter alia, that the
works had not been completed to its satisfaction. The plaintiffs’ commenced private law actions
against the council claiming the sums due under the grants. The council contended that if the plaintiffs
had any grounds of complaint (which it did not accept), the only appropriate
procedure was an application for judicial review and not an ordinary
action. It accordingly applied to strike
out the plaintiff’s claims under RSC Ord. 18 r.19 and the inherent jurisdiction
of the court. The district judge struck
out the claims; but the judge allowed the plaintiffs’ appeal and dismissed the
council’s application. The council
appealed to the Court of Appeal.
The Court of Appeal presided by Lord Woolf MR held that
when performing its role under the Local Government & Housing Act (UK) in relation to the making of grants, a local
authority was in general performing public functions which did not give rise to
private rights; but once an application for a grant had been approved, a duty
to pay it arose on the applicant fulfilling the statutory conditions and that
duty would be enforceable by an ordinary action. The court further emphasized that although,
in the case before it, there was a dispute as to whether those conditions had
been fulfilled, any challenge to the local authority’s refusal to express
satisfaction would depend on an examination of issues largely on fact – that
furthermore, the remedy sought for the payment of a sum of money was not
available on an application for judicial review. The court concluded that an ordinary action
was the more appropriate and convenient procedure and consequently that the
plaintiff’s actions were not an abuse of process. The appeal was therefore dismissed.
It is clear that when the speeches by Lord Woolf MR and
Pill, LJ are read in their proper perspective, they explicitly recognize that
remedies for protecting both private and public rights can be given in private
law proceeding and an application for judicial review. It is pertinent to note the observations made
by Lord Woolf MR in explaining the seminal decision in O’Reilly v. Mackman (1983) 2
AC 237 when he
said as follows:-
“Where does that
leave O’Reilly v Mackman … and what can be done to stop this constant
unprofitable litigation over the divide between public and private law
proceedings? What I could suggest is
necessary to begin by going back to first principles and remind oneself of the
guidance which Lord Diplock gave in O’Reilly v. Mackman. This guidance involves recognizing (a) that
remedies for protecting both private and public rights can be given in both
private law proceedings and on an application for judicial review; (b) that
judicial review provides, in the interest of the public, protection for public
bodies which are not available in private law proceedings (namely the
requirement of leave and protection against delay).”
Another significant case
referred to by Lord Woolf MR was Roy v. Kensington & Chelsea and Westminster Family Practitioner
Committee (1992) 1 AllER 705, where it was held before a strong bench of law
Lords comprising Lords Bridge, Emslie, Griffiths, Oliver and Lowry that
although an issue which depended exclusively on the existence of a purely
public law right should, as a general rule, be determined in judicial review
proceeding and not otherwise, a litigant asserting his entitlement to a
subsisting private law right, whether by way of claim or defence, was not
barred from seeking to establish that right by action by the circumstance that
the existence and extent of the private right asserted could incidentally
involve the examination of a public law issue.
It seems apparent from
It is in the light of the established principles stated
above that the respondents in our case maintain that the Court of Appeal has
erred in holding that their only cause of action against MPAJ lay in the area
of public law for post-collapse liability.
The respondents have relied on ordinary tort principles for their claims
of negligence. In this, they are amply
supported by established authorities.
They should be entitled to file their claims against MPAJ by way of writ
action. In this connection, I think it
is significant to draw attention to the findings of the learned trial judge on
the issue of post-collapse liability.
This is reflected in the following passage of his judgment:-
“To consider
whether the 4th defendant is liable for the acts and/or omissions
committed post-collapse, it is necessary to disclose some events that
transpired after the collapse of Block I.
After the
But after a period of one year,
there was no sight or news of this plan.
After numerous reminders by the 5th defendant of such a plan,
the 4th defendant on 29 March 1996 held another briefing. This time, the 4th defendant
informed the attendees that a new firm of consultant by the name of KN
Associates, was engaged to replace the previous. Again, the 4th defendant gave an
assurance that a comprehensive drainage plan of the area would be forth coming
with this replacement of consultant. Sad
to say, until the time when all evidence for this case was recorded by this
court, no comprehensive master drainage plan for the
It seems clear that after
the collapse of Block I, MPAJ had promised or assured the respondents that a
master drainage plan for the affected area on the hill slope behind
“Despite this
pressing need and the obvious knowledge of the urgent requirement for a master
drainage plan (for otherwise the 4th defendant would not have
initiated steps to appoint consultants for this work soon after the collapse of
Block I) to secure the stability of the slope so as to ensure the safety of the
two apartment blocks, the 4th defendant did nothing after the
respective consultants were unable to meet their commitments. The plaintiffs and all other relevant parties
are kept waiting because of the 4th defendant.”
Quite obviously, there
was a failure on the part of MPAJ to formulate and implement the promised
master drainage plan. This persisted at
the time of the trial before the learned trial judge. Certainly no settlement agreement was in
sight at the material time. Not surprisingly,
the learned trial judge found negligence on the part of MPAJ. Given the factual circumstances, I tend to
agree with him. In my view, MPAJ could not seek shelter in s. 95(2) of Act 133
because this is a case of negligence in failing to formulate and implement
certain works or plans and not negligence in carrying out those works or
plans. There was an assumption of
responsibility by MPAJ to do what it had promised to do. The respondents alleged that its failure to
do so had exposed MPAJ to liability for negligence. The negligence involved a complete absence or
failure of works or plans to be done or effected and not with the manner in
which the works or plans were being carried out or with the approval and inspection
of those works or plans which would have immunized MPAJ from liability for
negligence under s. 95(2) aforesaid.
The failure by MPAJ to formulate and implement the master
drainage plan had resulted in damages incurred by the respondents who had to
evacuate their apartments in Blocks 2 & 3.
The elements of forseeability and proximity are clearly discernible from
the established facts. Moreover, I do
not think it would be in the public interest that a local authority such as
MPAJ should be allowed to disclaim liability for negligence committed beyond
the expansive shelter of s. 95(2) or other relevant provisions of Act 133 nor
would it be fair, just and reasonable to deprive the respondents of their
rightful claims under the law. The
respondents’ claim for negligence by way of writ action is perfectly proper in
law. In my view, the Court of Appeal has
erred in holding that the respondents’ only recourse against MPAJ lay in the
area of public law by way of judicial review.
I may add that at the time the respondents filed this present action,
the public law remedy of judicial review under O.53 of the Rules of the High
Court, 1980, did not permit the recovery of damages. Hence, it is not inappropriate for the
respondents to proceed by way of writ action which they did. It is therefore in the context discussed
above that the question postulated should be answered.
8.
The Settlement Agreement
Before
us, the appellant MPAJ has relied on a settlement agreement which was effected
between AMFB (the 5th defendant) and the respondents as having the
effect of extinguishing its liability to the respondents. It is clear that the proceedings before the
High Court and the Court of Appeal were confined to the issue of liability for
negligence and nuisance. The High Court
found MPAJ to be 15% liable and this was upheld by the Court of Appeal. The said settlement agreement was never part
and parcel of the proceedings in the lower courts. As such, it has no bearing on MPAJ’s liability
to the respondents. It is therefore not
relevant for the purpose of this appeal.
9.
Conclusion
Given
the answers to the questions postulated and for the reasons stated, it is
appropriate to conclude that the appeal by MPAJ is allowed and the cross-appeal
by the respondents is also allowed.
Costs to the appellant and respondents accordingly. Deposits to be refunded to the successful
parties. Finally, let me say, in
postscript, that I am greatly indebted to counsel for the parties concerned for
their detailed and in-depth research work.
They have contributed much to a better understanding and appraisal of
the complex issues before the court.
(STEVE L.K.
SHIM)
Hakim Besar
Sabah &
Date of delivery of judgment: 17.2.2006
Date of Hearing: 18.7.2005
Counsel for the Appellant: Mr. V.S. Viswanathan
Messrs V.S. Viswa & Co.
Counsel for Respondents: Mr. Rajendra Navaratnam with
No. 1 - 73 Mr. Yatiswara Ramachandran,
Miss Marion Qua Li Lian and
Mr. Toh Chia Hua
Messrs Azman Davidson & Co.
Counsel for Respondent Mr. Shamsudin Abdullah
No. 74 Pegawai Penerima
Counsel for Respondent Mr. D. Bhaskaran with Mr. David Soosay
No. 77 Messrs Shearn Delamore & Co. Advocates