12 persona property

1.Explain the six different categories of property.

2.For a gift to qualify as a personal property, provide the three elements that need to be proven

3.Compare and contrast between the principles of law governing the rights of Finders of Lost, Mislaid and Abandoned Property.

4.What is bailment?

5.How is bailment created?

6.Explain the duties of the bailee.

7.What is the law that provides for Malaysians to have the freedom and right to own property?

TUTORIAL 11

TERMINATION OF CONTRACT

1.List the ways in which a contract can be terminated.

2.Explain how bankruptcy or insolvency renders the discharge of liabilities.

3.a)Describe briefly the concept of frustration

b)Explain the conditions for the doctrine of frustration to be successfully applied

c)What is the effect of frustration on the contract?

d)Cite a case law to illustrate the application of frustration.

4.Because injunction is an equitable remedy, the granting of an injunction is solely at the discretion of the courts depending on the case. Briefly provide the conditions that must be shown by the party who is applying for the injunction.

5.What is the rationale for the grant of a Mareva injunction?

6.The Anton Pillar order is said to be granted only in exceptional situation. Explain what would amount to such exceptional set of facts where the court feels justified to grant the order.

7.When the contract is rescinded, what will be the effects?

TUTORIAL 10

CONSIDERATION

1.Explain the concept of past consideration.

2.Discuss the implication of Kepong's case in respect to the doctrine of past consideration is not good consideration.

Kepong Prospecting Ltd &Ors v. Schmidt (1968)

Facts:

In 1953 Tan applied to the Government of Johore for a prospecting permit for iron ore. He was assisted in the negotiations by Schmidt, a consulting engineer. A prospecting permit was granted to Tan in Nov 1953 and in Dec 1953 Tan wrote to Schmidt stating that Schmidt was to be paid 1% of the selling p rice of all ore that might be sold from any portion of the said land and this was in payment for the work of Schmidt had done in assisting to obtain the prospecting permit and for any work that Schmidt might do in assisting to have mining operations started up. Tan then executed a power of attorney in favour of Schmidt which conferred upon Schmidt widely expressed powers to contract for the disposal of any of Tan's mining properties on such consideration and subject to such conditions as Schmidt thought proper.

In Sept 1955 an agreement was made between the company and Schmidt. Under Clause 1 of the agreement the company, inter alia, agreed to pay Schmidt 1 % of all ore that might be won from any land comprised in the 1954 agreement in "consideration of the services by the consulting engineer for and on behalf of the company prior to its formation, after incorporation and for future services." b

Disputes arose between those originally interested in the company and the persons who were subsequently interested. Schmidt commenced the present proceedings in July 1959 claiming inter alia an account of all monies payable to him under the 1955 agreement.

Held:

Clause 1 of the 1955 agreement established that a legally sufficient consideration had moved from Schmidt. Services prior to the company's formation could not amount to consideration as they could not be rendered to a non-existent company, nor could the company bind itself to pay for services claimed to have been rendered before its incorporation. But the inclusion of that ineffective element did not prevent the other two elements.

LORD WILBERFORCE:

... Apart from the question as to the validity of the execution of the 1955 agreement, the appellant company submitted that Schmidt was not entitled to sue upon it for a variety of reasons. In the first place, it was said that there was no consideration given by Schmidt for the obligation undertaken by the appellant company. The consideration expressed in the 1955 agreement was (by Clause 1) as follows:

The company shall in consideration of the services rendered by the consulting engineer for and on behalf of the company prior to its formation after incorporation and for future services pay to the consulting engineer one per cent ...

Their Lordships agree with the Federal Court in holding that this establishes a legally sufficient consideration moving from Schmidt. They accept that the services "prior to its formation" cannot amount to consideration. No services can be rendered to a non-existent company, nor can a company bind itself to pay for services claimed to have been rendered before its incorporation. The inclusion of this ineffective element, however, does not prevent the other two elements, or one of them, from constituting valid consideration, and both of them, in their Lordships' opinion do so.

Services rendered after incorporation but before the date of the agreement, can under the law of Malaysia, validly amount to consideration for an agreement to pay, since section 2(d) Contracts (Malay States) Ordinance (No 14 of 1950) expressly provides for this; in point of fact there is no doubt that such services were rendered. As regards future services their Lordships would hold if necessary that the clause should be understood as meaning that Schmidt as consulting engineer agreed to make his services available in the future if required by the company. Sufficient consideration is therefore established....

Appeal dismissed.

Read and discuss the implication of the following cases:

Pang Mun Chung & Anor v Cheong Huey Charn

Yeep Mooi v. Chu Chin Chua

2.Contracts that are made cannot be made against public policy.

a)Explain the notion of public policy.

It is based on the notion of protecting the public good and therefore, any injury to to the public good is a basis for denying the legality of a contract or other transaction.

b)Provide examples of such contracts.

Agreement to reward a civil servant when he/she successfully procured a benefit

3. Does the Contracts Act 1950 outline/define the types of contract that are illegal?

No. It merely states that contracts that are not unenforceable are void (section 2(g).

4.What is the purpose of section 24 Contracts Act 1950?

It provides for situations or object which are unlawful that will render such contracts void. The situations defined areobject is illegal, to restrain a marriage or trade; to restrain legal proceedings

5.Why does the law prohibit contracts entered into by/with business where their operations are unlicensed?

This is to protect the public so they will not be cheated or harmed by the products or services provided by parties where respective licenses are required.

6.What happens with contracts that are entered into with a business that is an unlicensed operation?

Contracts become unenforceable and therefore void.

7.Discuss the case below.

Act Sdn. Bhd. sells QuickLoss - a weight loss formula which is sold in the form of capsules. QuickLoss has never applied to the Malaysian Health Ministry for the latter's approval for QuickLoss as a health supplement. Act SdnBhd promises that at least 2 kgs will be lost each week by consuming eight capsules a day. QuickLoss is sold on Facebook. Ann has been buying and consuming QuickLoss for the past two months. A box of QuickLoss for two weeks supply costs RM250. Ann now complains that she not only failed to lose any weight but she has been suffering from serious digestive problems causing her to vomit each time she ingests food. She would like to sue Act Sdn Bhd. for a total of RM5000 (RM1000 for the four boxes of QuickLoss she bought and RM4000 for the medical fees). Advise Ann.

Ann needs to first establish that she and Act Sdn. Bhd. have a valid contract for her to sue for RM5000. The elements of offer, acceptance and consideration do not appear to be an issue. Instead, the main problem is whether the articles for sale i.e. the sale of QuickLoss is legal as in Malaysia health supplements must first get the approval of the Malaysia Health Ministry before they can be legally sold. Since this was not obtained, then this case comes under contracts for sale of article that cannot be thesubject matter of ordinary sale. On this, the contract between Act SdnBhd and Ann is an unenforceable one as it is void. When the contract is void, Ann can rely on section 66 Contracts Act which states that the person who has received any advantage under the contract is bound to restore it, or to make compensation for it, to the person from whom he received it. Therefore, Ann is advised to rely on this section to claim the RM5000 from Act Sdn Bhd. Void contracts where section 66 Contracts Act has been applied was also seen inYeep Mooi v. Chu Chin Chua.

TUTORIAL EIGHT

MID TERM REVISION

SECTION ONE:

1.Name the two types of misrepresentation under section 18 Contracts Act

2. Name the two options that are available to the party where the contract is voidable.

3. Which courts in West Malaysia have appellate functions (i.e. to hear appeal cases). Name any three.

4.Name two disadvantages of the Common Law

5.What are the sources of law in Malaysia that Article 160 Federal Constitution include? Name three.

6.List any three areas (types of cases) that come under the law of tort.

7. Name the five factors that can render a contract ineffective

8.These laws aims to promote competition in business, break up monopolies, and reduce collusion. What kinds of laws are these called?

SECTION TWO:

1. Describe the effects of a contract where it is found that undue influence was used by one party over the other?

2. Provide two distinctions between a void and voidable contract.

3. John agrees to buy from Ali the latter's used iPhone 7 Plus for RM500. John paid Ali and when Ali gave the phone to John, Ali realised that actually he only had the model iPhone 7 and that he never owned aniphone 7 plus. Advise John.

4.Explain the significance of the case of RosliDarus v. MansorHj. Saad & Anor (2001) in respect to the relationship between the Plaintiff and his uncle.

5. In a quasi-contract, which is also known as "implied-in-law contract", what can the court order the party to do?

6.Partridge v Crittenden

Carlill v Carbolic Smoke Ball Co Ltd

TUTORIAL SEVEN

DEFECTIVE CONTRACT

PART ONE: MULTIPLE CHOICE QUESTIONS

Question 1

Which one of the following statements is incorrect?

a)Misrepresentations cover false statements and half-truths.

b)A statement which is true when it is made but becomes false before the contract is completed may amount to a misrepresentation.

c)To be actionable the misrepresentation must be the only reason that persuaded the other party to enter into the contract.

d)In English law there is no duty to disclose information before a contract unless the contract is one of the utmost good faith or a special relationship of trust exists between the parties.

Question 2

Misrepresentation in a contract makes the contract:

a)Void.

b)Illegal.

c)Voidable.

d)Unenforceable.

Question 3

An operative mistake in a contact makes the contract:

a)Void.

b)Illegal.

c)Voidable.

d)Unenforceable.

Question 4

What is meant by a common mistake in the law of contract?

a)A mistake that is often made.

b)Where both parties make the same mistake.

c)Where only one of the parties makes a mistake.

d)Where the parties are at cross purposes.

Question 5

George buys a vase from Louis for RM200. Louis believes the vase is worthless but George knows it is valuable. George later sells it for RM10,000. What legal action can Louis take against George?

a)Sue George for the return of the vase as the contract is void for unilateral mistake.

b)Sue George for breach of contract.

c)Louis has no legal remedy.

d)Sue George for the return of the vase as the contract is void for common mistake.

Question 6

The possible remedies for negligent misrepresentation are:

a)Rescission and damages.

b)Damages only.

c)Rescission only.

d)Specific performance.

Question 7

What does rescission of a contract mean?

a)The contract is set aside and the parties are put back in the same position as if the contract had never been entered into.

b)The parties are put into the same position as if the contract had been completed.

c)Monetary compensation.

d)A false statement of fact.

Question 8

Which of the following statements is incorrect?

a)Duress is where a party has entered into a contract after one party has threatened physical violence or serious economic coercion.

b)The presence of duress makes a contract void.

c)Undue influence is where a party has entered into a contract after excessive persuasion.

d)The presence of undue influence makes a contract voidable.

Question 9

When will the courts presume that there has been undue influence is the signing of a contract?

a)Where there is a fiduciary relationship with the party against whom the undue influence is alleged.

b)In all contracts made between a married couple (or a co-habiting partner).

c)The courts will not presume undue influence. The party alleging undue influence must prove it has

occurred.

d)Where the contract is oral.

Question 10

Sally contracts with her employer that she will have a salary of RM35,000 per annum plus a cash payment of RM20,000 at the end of the year which will not be declared thereby avoiding tax. Sally's employer has now refused to pay her the RM20,000. Can Sally take legal action to enforce the payment of RM20,000?

a)Yes, Sally has completed the work as agreed.

b)Yes, provide the contract is in writing.

c)No, the contract is void for illegality.

d)No, the contract is void for mistake.

PART TWO: SHORT ANSWERS

1.Name the circumstances which will cause a contract to be defective.

2. What are the types of mistakes that render a contract defective?

3.Explain the following concepts:

a) Rescission

b) Affirmation

4.Describe the conditions that are required for a case of misrepresentation to be actionable.

TUTORIAL FIVE

1.Discuss the rules relating to offer. Cite some cases in respect to the relevant rules.

2.List the situations when an offer can come to an end.

3.How does counter-offer arise? Provide examples to illustrate how it takes place.

4.John runs a pharmaceutical shop and has a pharmacist at the counter most of the days. Many items, including drugs, were displayed and sold in the shop. Mary walks in and takes a few items including hair brushes and toiletries. She inquires from John on the toiletries. In the meantime, she also takes some drugs off the shelf when the pharmacist steps out for a while. She then checks out the items including the drugs at the payment counter. John is later charged with selling drugs illegally. In the meantime, John offers Aaron to paint his shop for RM5000 and states that Aaron must reply within 3 days from the date of offer by whatsapp or sms message on the phone.

a.Is John liable for the charge of selling the drugs to Mary illegally? Discuss

b.Discuss the law of offer and acceptance in respect to John's offer to Aaron to paint his shop.

TUTORIAL FIVE

ANALYSIS OF CASE LAWS RELATING TO VOID & VOIDABLE CONTRACTS

CASE ONE:Ahmad bin Udoh & Anor v Ng Aik Chong

The respondent had entered into an agreement with the appellants for the lease of padi land for a period of six years. Pursuant to the agreement, a sum of RM1,500 was paid to the appellants, who subsequently refused to allow the respondent to till the land. In an action to recover the sum paid, the Sessions Court judged in favour of the respondent.

On appeal, the appellants raised a new issue that was not pleaded earlier - that the agreement was illegal for contravening S3(1) of the Padi Cultivators Ordinance 1965 and that therefore the sum paid under the illegal agreement was not recoverable by the respondent.

The High Court dismissed the appeal. The case went on further appeal to the Federal Court.

Suffian FJ (as he then was) held that for an agreement "discovered to be void" under S66, "it includes an agreement that was void from its inception." His lordship held that based on the facts: "There is no evidence that the respondent was inpari delictoand that he knew when he entered into the agreement that it was forbidden by law, the illegality of the agreement was discovered subsequent to the making of it, the claim for restoration of his money is not based on the illegal contract but dissociated from it ..."

CASE TWO:Yeep Mooi v Chu Chin Chua &Ors

The appellant had deposited some money with a person who was carrying on a borrowing business and as he was not a public company or a licensed borrowing company, the transaction was illegal, void and unenforceable under S3 of the Borrowing Companies Act 1969 ("the Act").

The appellant did not know nor suspect that the deposit transaction contravened the Act. She placed her money on deposit in good faith and subsequently received interest from it. She only became concerned about the safety of her money when she learnt of the depositee's death and demanded a refund but was refused and she filed a suit against the estate.

She only became aware that the transaction had contravened the Act when she received a copy of the statement of defence claiming that the transaction was void and unenforceable. It was under such circumstances that the appellant became entitled to the restitution of her deposit under S66 of the Contracts Act where the court went on to say:

"An agreement 'discovered to be void' does not mean that the contract is void on discovery or void because of discovery of illegality. It means what it says, in that the contract was voidab initiowithout the parties at the time being aware of the true legal position.

It is only later that the contract is found to be void and so they became aware of its voidness. We are of the view, therefore that S66 of the Contracts Act applies to this, and the appellant is entitled to the restitution of her money by the pawnshop ..."

TUTORIAL FOUR:GOVERNMENT'S REGULATION OF BUSINESS

QUESTION 1:

Read the case of Cameron Highlands Floriculturist Association (CHFA).

Describe the legal issues that arose concerning the actions of CHFA in connection with the Competition Act 2010.

Finding of Infringement under section 40 of the Competition Act 2010 - Infringement of Section 4(2)(a) of the Competition Act 2010 by Cameron Highlands Floriculturist Association

On 4 March 2012, the President of the Cameron Highlands Floriculturist Association ("the CHFA"), Mr. Lee Peng Fo issued a statement published in the online portal of The Star that the CHFA will increase the prices of flowers by 10% effective from 16 March 2012. Mr. Lee Peng Fo as the President of the CHFA also mentioned that all its one hundred and fifty (150) members agreed to the said increase.

(CHFA Adviser, Mr. Cheong Yun Meng suggested that the prices of cut flowers be increased and his suggestion was unanimously agreed upon by all the members who attended the meeting. All of them then decided to increase the prices of Cameron Highlands cut flowers by 10% and the increase was to come into force on 16 March 2012 for flowers sold in Malaysia and abroad, except Japan.)

Based on that statement, the Competition Commission ( "the MyCC") as the body enforcing the Competition Act 2010 (hereinafter referred to as "the Competition Act") conducted an investigation relating to this matter. Results from the investigation conducted indicated that the CHFA members have engaged in an anti-competitive practice to fix, directly or indirectly, the selling price of their floricultural products by entering into a horizontal agreement between them which has the object or effect of significantly preventing, restricting or distorting competition in the floriculture market.

In reference to the abovementioned definition, it is clear that a decision made by an association is also considered as an agreement. It is the intention of the Competition Act to widen the meaning of an agreement to also cover all the decisions made by an association without limiting it to just an ordinary agreement. 2.4. In this case, the decision made by the CHFA to increase the prices of Cameron Highlands cut flowers by 10% and the increase is to be enforced on 16 March 2012 for flowers sold in Malaysia and abroad, except Japan, is considered as an agreement. A copy of the Minutes of the Meeting on the Price Increase of Cameron Highlands Cut Flowers held on 28 February 2012 as submitted by the CHFA to the MyCC is referred to as evidence that there exists an agreement that was approved by the CHFA members. 2.5. Besides, the MyCC also considers that whether or not all the CHFA members complied with the decision made was of no relevance. Likewise, whether or not the decision made by the CHFA was applicable to all its members. This is due to the statement by Mr. Lee Peng Fo as published in the online portal of The Star that all its one hundred and fifty (150) members agreed to the said increase.

TUTORIAL THREE

READ CASE ONE & TWO. HIGHIGHT THE RELEVANT ISSUES & ITS IMPLICATIONS

CASE ONE:

Case against the importer and its director:

The importer (HealthBiz) was a company founded and owned by its director, Semon Liu. On one of his trips to China, he was introduced to the slimming pills which he personally consumed and found to be effective without suffering any side effects. elsewhere although he was new to this business of importing slimming products for sale.

The said slimming pills (named Slim 10) were sent for microbiological test and toxic heavy metal chemical analysis test. He was told by the laboratory which did the testing that nothing harmful was detected. The importer received the import and wholesale dealer's licence for Slim 10 from Singapore Health Sciences Authority ("HSA") on 27th June 2001. On 1st November 2001, the importer, at the request of HSA provided an undertaking to comply with HSA's requirements to submit test results for toxic heavy metal and microbial contamination within two months of import of the consignment of Slim 10.

HSA then approved the product listing for Slim 10 and the importer commenced importing the products from the manufacturer. Up until 1st February 2002, the importer had still not tested any samples from the imported consignments. On 30th April 2002, HSA issued a press release stating that fenfluramine, a controlled substance under the Poisons Act, had been detected in Slim 10.

In June 2002, HealthBiz and Semon Liu were charged for offences relating to Slim 10.

In the criminal proceedings, they admitted that the product had arrived by air parcel, unlabelled and in aluminium foil or in plastic bags, unaccompanied by any documentation as to their identity or source. The contents were not declared to the customs authorities in Singapore and there were no records of the imports and therefore no details were available on the various consignments.

Against the backdrop of the above facts, the High Court found that there can be no doubt that HealthBiz as importers owed a duty of care to consumers, like the Plaintiff, of its product. However, the Court disagreed with the Plaintiff's argument that the importer's duty of care extended to conducting a "due diligence" check on the manufacturer. It was sufficient that the importer knew who the manufacturer was, where it was situated and whether it was properly licensed to produce thegoods.

What the Court found wanting was the importer's failure to keep proper records of the consignments of pills imported and to do proper batch tests. It was not sufficient for the importer to merely commission tests and then leave it to the authority to inform the company if poisons and synthetic substances were shown. It was required to submit a declaration of the absence of poisons and synthetic substances in the product but it did not do so.

Due to the very exceptional circumstances of the case, the Court lifted the corporate veil and found Semon Liu personally liable in negligence too because his involvement in the negligence was not merely very great, it was total. The Court of Appeal upheld the decision of the High Court on the issue of liability against the importer and its director. A person, who has, in the course of his business, imported the product into Malaysia in order to supply it to another person shall be liable for damage caused wholly or partly by a defect in the product.

JUSTICE SERVED - FOR NOW - IN COUNTRY'S BIGGEST GOLD SCAM

FOR the 35,000 people who invested in the biggest gold scam in the country, it would appear that they would finally get the justice they had been seeking. Last Tuesday (Aug 4), the High Court found gold investment firm Genneva Malaysia SdnBhd (GMSB) guilty of money laundering and illegal deposit taking.

The court imposed a RM450 million fine on GMSB and sentenced eight individuals, who were either former directors or advisers of the company, as well as two other companies to four to nine years' jail and fines of RM1 million to RM4 million each.

In terms of recouping their investments, however, the purported investors who did not receive their money on selling back their gold or had paid money but did not receive gold from GMSB can file a claim under the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 as a bona fide third party.

Bank Negara Malaysia sources say claims can be made towards the seized monies or other properties that had been frozen by the authorities. Those affected can also sue the company based on the sale or purchase of gold.

"In other words, they can still sue based on contractual rights made with the companies. Bank Negara is not involved in these disputes between individual parties but rather, we assist the public at large by publishing updates on the case on our website," says a person who spoke on condition of anonymity.

It is understood that Bank Negara had either seized or frozen the related accounts of GMSB and GennevaSdnBhd and claims could possibly be made through third-party claims.

GMSB, which was formed in 2002, is said to be syariah-compliant and had Ahmad Khairuddin as one of its Malay/Muslim directors; GennevaSdnBhd was incorporated in 2007 and caters for the conventional market. The two companies have common shareholders in Datuk Marcus Yee Yuen Seng and Datuk Ng Poh Weng.

In 2014, GMSB and eight individuals were charged with more than 1,000 counts of money laundering and illegal deposit-taking in relation to the gold investment scheme.

The case management for the third-party claim has been fixed for Sept 3 at the Kuala Lumpur High Court.

The number of investors and quantum of investments in GMSB's gold scheme were mentioned by then deputy finance minister Datuk Dr Awang Adek Hussain in Parliament as far back as 2012.

In all, two criminal cases had been filed against the group. One was against GennevaSdnBhd and its four former directors while the other was Tuesday's case involving GMSB, eight individuals and two other companies Ng Advantage SdnBhd and Success Attitude Sdn Bhd.

It was reported in April last year that the Court of Appeal had convicted four of GennevaSdnBhd's directors of money laundering and receiving unlicensed deposits worth more than RM200 million. This came after a three-member Court of Appeal bench led by Justice Datuk Yaacob Md Sam dismissed their bid for a review of their conviction and sentence of eight years' imprisonment.

Those sentenced were Ng, 69; Yee, 67; Chin Wai Leong, 43; and Liew Chee Wah, 65. On Jan 4, 2018, they were jailed for eight years and fined RM1 million each.

They were found guilty by the Court of Appeal on 154 charges of committing money-laundering offences at Menara Public Bank, Jalan Ampang, in Kuala Lumpur, between July 2008 and June 2009, and four counts of illegal deposit-taking offences under the Banking and Finance Institutions Act 1984 (BAFIA) at the company's premises in Jalan Kuchai Maju 6, Kuala Lumpur, between November 2008 and July 2009.

Sessions Court's decision overturned

Ng and Yee from the GennevaSdnBhd case, along with Datuk Philip Lim Jit Meng, Datuk Tan Liang Keat, Lim Kah Heng, Chiew Soo Ling, Ahmad KhairuddinIlias and Yao Kee Boon, as well as GMSB, Ng Advantage and Success Attitude, were involved in the second case.

As mentioned, this case involved a bigger sum and more individuals. Initially, the Sessions Court called on them to enter their defence. After their defence was called and at the end of the case, the Sessions judge decided to acquit all of them on March 17, 2017.

A notice of appeal was filed by the prosecution three days later, and after subsequent case managements and the transfer of the case before several High Courts, a reversal came about. Last Tuesday, KL High Court Judicial Commissioner Datuk Ahmad ShahrirMohd Salleh overturned the Sessions Court's decision in ruling that there was an error made by the Sessions judge.

"The decision by the Sessions Court in 2017 is hereby reversed and this court decides to convict the accused persons as follows, that Genneva Malaysia, along with Tan, Jit Meng, Lim and Ahmad Khairuddin, is convicted under Section 25 (1) of the BAFIA for accepting deposit without a valid licence and Ng is found guilty of abetting the commission of accepting deposit without a licence. Meanwhile, Genneva Malaysia along with Tan, Lim, Ng, Jit Meng, Yee, Chiew, Success Attitude, Ng Advantage and Yao is convicted of money laundering," said Ahmad Shahrir.

The Bank Negara prosecution team consisted of deputy public prosecutors Alvin Ong and Hardeep Kaur.

GMSB along with Tan, Lim, Jit Meng, Yee, Chiew and Yao, were represented by counsel Gooi Soon Seng; Datuk GobinathMohanna appeared for Ng and Ng Advantage; and MohdIzwanIswatMohdNor appeared for Ahmad Khairuddin. Yee and Ng were brought from prison for the hearing and decision.

Ahmad Shahrir went on to hear mitigation and sentence from the lawyers. The proceedings ended around 7.20pm.

In the end, the court imposed a total fine of RM450 million on GMSB for illegal deposit-taking while all eight were sentenced to between three and nine years' jail and fined a total of RM780 million. Success Attitude and Ng Advantage were also fined RM8 million and RM101 million respectively.

Ahmad Shahrir granted bail to all the accused except for Yee and Ng, who are currently serving their jail sentence after exhausting their appeal in the other Genneva case. Bail for the remaining six wasset at RM1 million with one surety. At press time, however, four managed to post bail whereas Ahmad Khairuddin is expected to be released on Monday.

https://www.theedgemarkets.com/article/justice-served-%E2%80%94-now-%E2%80%94-countrys-biggest-gold-scam

(EXTRA READING)

First Person Convicted of Money Laundering Now Serving Jail Sentence

June 10, 2020The Edge Malaysia Weekly

A decade and a half before the high-profile money laundering cases involving former premier Datuk Seri Najib Razak and members of his family, a medical doctor and co-founder of Safire Pharmaceuticals SdnBhd was the first in the country to be charged under the Anti-Money Laundering Act 2001 (AMLA) for sums involving millions of dollars.

More specifically, Dr HamimahIdruss was charged in 2005 with eight counts of money laundering of US$12 million (RM41.337 million) under AMLA and 10 counts of abetting in forgery in the issuance of promissory notes to secure funding from Siemens Financial Services Ltd (SFS) for her company.

AMLA later evolved into the Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001.

In February, a three-member Court of Appeal bench led by Datuk Yaacob Md Sam upheld the 2012 decision of the Sessions Court, which found the 70-year-old Hamimah guilty, thus concluding 15 years of trial and exhausting all avenues of appeal. Her appeal in 2017 to the High Court was also dismissed.

The written judgment of the appellate court was only released recently. In its judgment, the appeals court sentenced Hamimah to 38 years' imprisonment and ordered her to pay a pecuniary penalty of RM6.35 million or in default of one year's jail.

But even though a 38-year jail sentence was meted out, she will only serve three years' jail for the 10 forgery convictions under Section 109 of the Penal Code, as the sentences were ordered to run concurrently.

Hamimah's case centred on purported promissory notes issued by the company she co-founded with her husband that had been forged with the guarantors' signatures.

It was revealed in court that in 2003, she had directed her marketing manager Yusaini Wan Abi Safian to prepare 10 promissory notes that were purportedly issued by Safire and guaranteed by PharmaniagaBhd and the Ministry of Health (MoH).

The promissory notes defined by Investopedia as a financial instrument that contains a written promise by one party to pay another party (the note's payee) a definite sum of money, either on demand or at a specified future date possessed the forged signatures of then Pharmaniaga chief operating officer Dr Effendy Tenang and then deputy health minister Datuk Seri Dr Sulaiman Mohamad.

Promissory notes to save Safire

In the unanimous Court of Appeal judgment written by Judge P Ravinthran dated March 2, the court found that the promissory notes were issued on Hamimah's directive to Yusaini in a bid to save her heavily indebted company.

A total of 54 prosecution witnesses were called and Yusaini, the 47th and star witness, testified that he was ordered by his boss to draft the promissory notes and to forge Effendy's signature, and was paid RM200,000 in return. Yusaini maintained that he would not have forged Effendy's signature but for Hamimah's insistence.

Effendy denied having signed the notes. The promissory notes, along with other supporting documents such as invoices and delivery orders purportedly issued by Great Econ Power SdnBhd, were attested before a commissioner for oaths.

SFS credit portfolio management head Florian Rek, the prosecution's first witness, testified that his department was in charge of purchasing long-term receivables that included promissory notes.

"Rek said his company purchased the 10 promissory notes for the sum of US$1.2 million each, which was issued by Safire.

"The foreign witness said he sought legal advice from a London-based entity, Bon Pour Aval Ltd, which assured the promissory notes had 'very good credit risk' because they were guaranteed by Pharmaniaga and the Ministry of Health," the judgment by Ravinthran states.

Sulaiman, the deputy minister at the relevant time, denied ever issuing a guarantee letter from MoH to a company. "Issuing a guarantee letter from the ministry on behalf of the Malaysian government to any company was a breach of ethics and against government policy," he previously testified.

No appealable error

The appellate court that comprised judges Yaacob, Datuk ZabariahMohd Yusof and Ravinthran found "no appealable error" in the decisions of the Sessions Court and High Court.

"The convictions recorded by the Sessions Court are affirmed. We also affirm the sentences imposed by the Sessions Court.

"However, we shall make a correction in respect of the pecuniary penalty that the accused is liable to pay. We shall substitute the sum of RM6.39 million to RM6.35 million, which will be payable pecuniary penalty," Ravinthran said.

Of the RM41.337 million given out by SFS, the authorities managed to recover close to RM35 million, hence the pecuniary penalty of RM6.35 million that was imposed for money laundering defined by Bank Negara Malaysia as "a process of converting cash or property derived from criminal activities to give it a legitimate appearance. It is a process to clean 'dirty' money in order to disguise its criminal origin".

Hamimah was represented by counsels Harvinderjit Singh and Sara Ann Chay Sue May while deputy public prosecutors Datuk MohdDusuki Mokhtar and Asmah Musa appeared for the prosecution.

Her trial of 10 counts of abetting to forge and eight charges of money laundering began in 2005, and took longer as midway through her trial, her then counsel Pushpam Subramaniam died.

Current money laundering cases before the court involving Najib and his family involve billions of ringgit. Najib faces 24 such charges in relation to funds of SRC International SdnBhd and 1Malaysia Development Bhd totalling RM2.322 billion, and is currently on trial.

His wife Datin Seri RosmahMansor is facing 17 counts of money laundering in excess of RM7 million but has yet to stand trial.

Her son and Najib's stepson, Riza Shahriz Abdul Aziz, was recently given a discharge not amounting to an acquittal by the Sessions Court on five counts of money laundering charges involving US$248 million (RM1.3 billion) of 1MDB funds.

The discharge came after an agreement was reached between Riza and the Attorney-General's Chambers, but has been criticised as being unjust as, among others, Riza was only compelled to return less than half of the amount he was charged with laundering.

1.Answer True or False

a.The Supreme Court is presently the highest court in Malaysia

b.The Sessions Court is a subordinate court

c.The Federal Court is the highest court in Malaysia and it hears appeals from the Court of Appeal

d.The Privy Council is the highest court of appeal in Malaysia

2.Describe the hierarchy and the functions of the Superior Courts in Malaysia.

Provide a diagram, where possible, to illustrate the hierarchy visually.

3.List which court the following proceedings will be heard

a)John and Jane are getting a divorce.

b)Kim, the deceased, left his multi-million estate to his four children.

In his will, he appointed his nephew to administer

c)Kelly, 14, is alleged to have committed the following acts:

-Cyber bullied her best friend, Leah, for the past 2 years

-Physically attacked her class monitor when the latter reprimanded her to stop talking

d)Ali and Chong are neighbours of a gated and guarded luxury neighbourhood with all bungalows. Ali wants to sue Ahmad. Ali alleges that Chong, while renovating his house, has caused property damage (destroying Ali's front porch tiles amounting to RM80,000

e)Murali, 15, is charged for raping a 21 year old female.

f)Jackson will be charged. He is said to have sneaked and broke into Pam's house last month. He is alleged to have stolen Pam's Mac, iPhone12, and her Toyota sedan.

g)Mrs. Tan failed to provide food for her Indonesian maid for the past 2 weeks and made her sleep in the porch on the concrete cement for the past 1 month.She also used her husband's belt to whip the maid on a daily basis. The maid was found dead by Mrs Tan's neighbour.

1.English common law and the rules of equity form part of the law of Malaysia.

Discuss the extent of the application of the English common law as applied in Malaysia today.

2.Malaysian law can be classified into written and unwritten law.

Explain the term "unwritten law" in Malaysia.

3.Read and understand the case. Discuss the implication of the decision.

R Rethena v The Government of Malaysia (1988) 1 MLJ 133

Facts:

The plantiff sought declarations to the effect that sections 31 & 42 of the Employees' Social Security Act 1969 (SOCSO) were ultra vires the Federal Constitution. The plaintiff's contention was that these sections violated Article 8(1) of the Federal Constitution which provided for equal protection of the law for all persons and for equality of all persons before the law. The two sections of SOSCO were discriminatory because employees, in industries covered by SOCSO, were precluded from suing their employers under the common law for damages arising from injuries sustained in the course of employement.

Held:

The court dismissed the plaintiff's claim as the classification by SOCSO was fair and reasonable and therefore did not offend Article 8(1) and therefore was not void under Article 4(1)