Legal cauldron 2 of 2013


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Legal cauldron 2 of 2013

  1. 1. PETALING JAYA Unit 612, 6th Floor, Menara Mutiara Majestic, No. 15, Jalan Othman, 46000 PJ, Selangor. T: 03-7784 7255 F: 03-7781 7255 KOTA BHARU 1 2713, 1st Floor, Section 22, Batu 2, Jalan Kuala Krai, 15050 Kota Bharu, Kelantan. T: 09-741 2050 F: 09-741 2051 KOTA BHARU 2 Tingkat 2, Lot 11, Bangunan Tabung Haji, Kompleks Niaga, Jalan Dato Pati, 15000 Kota Bharu, Kelantan. T: 09-747 7782 F: 09-747 4733 Issue no. 2 of 2013 LEGALCAULDRONIssueNo2of2013 MELAKA No.54-1, Jalan TU 2, Taman Tasik Utama, 75450 Ayer Keroh, Melaka. T: 06-234 7330 F: 06-234 4800 LEGAL CAULDRON Jayadeep Hari & Jamil Advocates and Solicitors Our offices: No KDN: PP 15706/02/2013 (032198) KUALA LUMPUR Suite 2.03 (2nd Floor) Block A, No 45, Medan Setia Satu, Plaza Damansara, Bukit Damansara, 50490 Kuala Lumpur. T: 03-2096 1478 | F: 03-2096 1480 The Minimum Retirement Age Act 2012 EDITOR: Adeline Chin DESIGN & LAYOUT: Andrew Chee CONTRIBUTORS: Shobana Padmanathan Shahman Sangaran Eunice H.S. Ong Barvina Punnusamy Adrian Low JHJ Charity Mission - Give a Home a Library Shedding Light on Vehicle Tinting Park At Your Own Risk The Powers of a Manage- ment Corporation Understanding Force Majeure in Commercial Contracts In this Issue: JHJ 360˚ Student Attachment Programme - Testimonials
  2. 2. Editor’s Note Stop on red, go on green. Yellow? Well, driving school would have taught us that it means “prepare to stop”. But for some drivers, perhaps the term “proceed with caution” would be more apt an observation. Everyone is deemed to know the law afterall. There are areas of law like the red and green traffic lights with manifest instructions or regulations (and repercussions of course); and then there are are- as of law akin to the yellow traffic lights, which we more often than not tread on. This issue of the Legal Cauldron comprised of selected contributions touching on subjects sharing a hue similar to that of a yellow traffic light - persistent yet more often than not neglected, until trouble en- tails. We boldly questioned the jurisdiction of some managerial bodies, analyse the utility of the recent Minimum Retirement Age Act and unveil the potential- ity of force majeure clauses. I am grateful to all the associates and pupils who have contributed to this issue of the Legal Caul- dron. The hours of research effort put into writing these articles aside, it was the “We Care” spirit re- flected in the way topics were decided upon based on what may be most relevant to our readers, and the drive to seek sensible riposte to these pertinent mat- ters which is truly prized. Eventful is the year 2013 to date, and it is our pleasure to share with you some of these memories crystalized in the form of photographs within the pag- es. January saw our pupils-in-chamber battle for hon- our in a Parliamentary style debate, with the Managing Partners sitting on the judging panel. Impressive speeches were presented, the judges deliberated, and new champions were announced on that glorious day. The JHJ team carried that fiery enthusiasm through to March for our charity mission: “Give a Home a Library”. Our team went on a drive to seek and collect suitable reading materials for the children and teens of Shelter - Home for Children, throughout the month. Smiles and laughter filled the house when we played a game of Pictionary with our young hosts, shared food and set up the library corner. March also marked the successful graduation of our Attachment Students from the second year running of our JHJ 360˚ Student Attachment Programme. We take delight in picking up where we left off since the first issue of our 2013 Legal Cauldron, in a bolder way. We’ve upped the selection of articles from the previous 3 to the current 5 in order to facilitate better knowledge sharing with you, our dear readers. Hope you enjoy the latest edition of the Legal Cauldron with our compliments. Legal Cauldron 2 of 2013 | 2 EDITOR Adeline Chin Knowledge Department
  3. 3. Business Management studies teach that a company’s employees are its intellectual capital and are the great- est intangible asset. Being cognizant of this principle, most western countries have set the minimum retire- ment age at 65. Closer to home, the Singaporean gov- ernment had, last year, raised the retirement age to 62. Now Malaysia is no exception when the Minimum Re- tirement Age Act 2012 was passed in July 2012 and ga- zetted on 16 August 2012. The Act is said to take effect on 1 July 2013. The Act has increased the minimum retirement age of the private sector employees from 55 to 60. Sec- tion 4 (2), however, allows the Minister to prescribe a minimum retirement age higher than 60 by notification in the Gazette. This article will discuss the guidelines of the implementation of the Act, outline the significant sec- tions and identify the redress available to both employ- ers and employees in the event of any non-compliance of the Act. GUIDELINES ON THE IMPLEMENTATION OF THE ACT The passing of the Act has received mixed reaction across the nation; some of which includes fear of non- compliance, efficacy of implementation and possible ef- fects on both employees and employers. In appeasing these qualms, the Ministry of Human Resource had al- lowed employers (up to 28 February 2013) to defer the commencement of the implementation of the Act up to 6 months. DEFINITION OF ‘RETIREMENT’ The term retirement has been defined as “termination of a contract of service of an employee on the ground of age”. Having said this, it is only obvious that the Act strictly deals with termination on the ground of age. It does not deal with other forms of termination as they fall under the purview of the Industrial Relations Act 1967. As such, the Act is under the governance of the Labour Department and not the Industrial Relations Department. PRELIMINARY SECTIONS Section 2 of the Act with reference to the Schedule states that the Act does not apply to persons employed on a permanent, temporary or contractual basis by the Federal and State Government, statutory bodies and local authorities. It also does not apply to persons working on a probationary term, apprentices employed under an apprenticeship contract, non-citizen employ- ees, domestic servants, persons employed in any em- ployment with average hours of work not exceeding 70% of the normal hours of work of a full-time employ- ee, students employed under any contract for a tempo- rary term of employment (this does not include employ- ees on study leave or employees who study on a part- time basis), persons employed on a fixed term contract of service; inclusive of any extension of not more than 24 months and finally, persons retired at the age of 55 years and above before the date this Act takes effect and is subsequently re-employed after the said retire- ment. Section 5 prohibits an employer from prema- turely retiring an employee before the employee attains the minimum retirement age. A premature retirement does not include an optional retirement under Section 6 and a termination of a contract of service for any reason other than on the ground of age. Employers who disre- gard this law are deemed to have committed an offence and will be liable to a fine not exceeding RM10,000.00. By virtue of Section 7 of the Act, the retirement age in a contract of service or collective agreement made before, on or after the date this Act takes effect which is less than the minimum retirement age (60 years) provided by this Act is deemed void and will au- tomatically be substituted with the minimum retirement age provided by this Act. Having said this, the Act does not refuse employees from seeking optional retirement agreed in a contract of service or collective agreement. REDRESS AVAILABLE TO AN AGGRIEVED EMPLOYEE An employee who has been prematurely retired by his employee has two options. The employee can, under this Act, opt to complain in writing to the Director- General of Labour within 60 days from the retirement or make a representation under section 20 of the Indus- trial Relations Act 1967 (“the IRA”). The aggrieved em- ployee is not allowed to make dual representation/ complaint simultaneously. In the event an employee has made a representation under section 20 of the IRA, the Director General will not conduct an inquiry of the complaint under this Act. However, if the complaint Legal Cauldron 2 of 2013 | 3 ‘The Act has increased the minimum retirement age… from 55 to 60.’ THE MINIMUM RETIREMENT AGE ACT 2012 By Shobana Padmanathan
  4. 4. under this Act has been heard and dismissed, it is only then when an employee may appeal against the decision or make a representation under the IRA within 30 days after the dismissal of the complaint. If an employee has made a representation under section 20 of the IRA upon dismissal of his complaint to the Director General, the employee will not be entitled to an appeal under this Act. Also, if the Director Gen- eral has made a direction under this Act, the employee will similarly not be entitled to any other remedy for a dismissal without just cause and excuse under the IRA. Upon an inquiry, the Director General may dis- miss the complaint if he is satisfied that there is no pri- ma facie evidence to substantiate the complaint. On the other hand, if the Director General is satisfied that an employee is prematurely retired, he may direct an em- ployer to (1) reinstate the aggrieved employee to his former employment and pay the employee any arrears of wages calculated from the date of premature retire- ment to date of reinstatement or (2) pay the employee a compensation in lieu of reinstatement which shall not exceed the amount of total wages calculated from the date of premature retirement to the date the employee attains the minimum retirement age. The inquiry by the Director General prescribed by this Act allows the Director General to refer any question of law for the decision of a Judge of the High Court and the decision of the inquiry must be in con- formity with the decision of the Judge of the High Court. If there is any dissatisfaction with the decision of the Judge of the High Court, the aggrieved party may appeal to the Court of Appeal. Most importantly, an employee who is dissatis- fied with the decision of the inquiry by the Director General may appeal to the High Court. NON-COMPLIANCE WITH THE DIRECTION OF THE DIRECTOR GENERAL An employer who fails to comply with the direction of the Director General is deemed to have committed an offence and will be liable to a fine not exceeding RM10,000.00 and upon conviction, the Court can order the employer to pay the employee the amount directed by the Director General. Further to that, if the employ- er fails to comply with this order, the employee may apply to the Court to issue a warrant to levy the em- ployer’s property for the amount ordered to be paid. The Director General has, by virtue of this Act, been conferred wide powers to investigate any offence and enforce any provision under this Act; to be precise, he has the power to require the attendance of persons acquainted with the case and the power to require the production of any document acquainted with the facts and circumstances of the case. EFFECT ON THE EMPLOYEES PROVIDENT FUND (EPF) Currently, the EPF Act 1991 allows employees to with- draw part of their savings at the age of 50 years and the remaining at 55. The Ministry of Human Resource has announced that EPF Act 1991 will be amended to allow employees to withdraw their full EPF savings either at 55 or at 60 years. CONCLUSION The Act is said to be a step forward taken by the Malay- sian Government to not only encourage the country’s competitiveness but also an effort to improve the wel- fare of the Malaysian citizens. It is the author’s opinion that this Act is sought as an opportunity by both em- ployers and senior employees who are in good health to continue to work and in turn impart their experience and skilled talent to train the younger generation. This would create a competent and skillful workforce. After all, employee productivity and efficiency is not an age issue but that of a performance management issue. by Shobana Padmanathan Legal Cauldron 2 of 2013 | 4 ‘An employee who is dissatisfied with the decision of the inquiry by the Director General may appeal to the High Court.’ JHJ featured on Asia Business Channel Asia Business Channel (ABC) is an independent production company specialized in producing programs that focus on the economic development as well as the sights and sounds of countries in focus. These special programs are aired on a regular basis on Asia’s premiere television network, Channel News Asia. source:
  5. 5. The sunny morning of March 16 was more than our ordinary Saturday mornings. We were on a mission, and had been painstakingly planning it for the past weeks. Our mission started off early with some of us loading boxes full of books into the cars, whilst others packed up the food, drinks and other necessities. By 1300 hours, more than half a dozen cars were "deployed" from various locations heading towards Shelter 2 at Taman OUG. It is and had always been JHJ's mission to reach out at least once a year towards charitable bodies and/or organisa- tions. We work hand in hand with different organisations yearly, but our goal to make a change for the better no matter how insignificant remains resolute. This time we pledged to give something priceless; something beyond a day's worth of entertainment and smiles. We pledged to Give a Home a Library. Books are pathways to a world of knowledge, and the best way to travel the world yet. So this time round we will leave behind a portal for the future instead of mere good memories. Members of the JHJ family hunted down good reads from various sources including, inter alia, navigating through the crowd in the Big Bad Wolf book fair and diligently searching for book donations on relevant reading materials that ca- ters to the Home. The bookshelf arrived at the Home earlier that morning and our book carriages reached just in time for it to be filled up. We shared lunch with our young hosts and proceeded to a noisy game of Pictionary (yes, the irony). Winners of the Pictionary game won themselves ang pows courtesy of our Sports Committee. Thankful we are to the management of Shelter Homes in granting us an opportunity to share smiles on that day, and here we would like to share bits and pieces of our memories with you in the mission snippets on Page 15. Sponsored by: In collaboration with: “It is what you read when you don't have to that determines what you will be when you can't help it" - Oscar Wilde JHJ Charity Mission Give a Home a Library Legal Cauldron 2 of 2013 | 5
  6. 6. How often do you enter your car and feel like you’re in a frying pan? In a country like Malaysia, it is summer all year long due to our country’s location near the Equa- tor. If you’re sick of feeling like an overcooked “pisang goreng”, having your car tinted may become a necessity. Tinted glass helps to block the sun’s heat and a whopping 99.9% of damaging ultraviolet (UV) rays. It also helps protect your eyes from glare and eyestrain, and your skin from sun damage. Not only that, it pro- tects the interior of the vehicle, which translates into cost saving. Some security tinted glass also makes your ve- hicles safer by holding shattered glass in place during collision thereby protecting the driver from potential injury from shattering and flying glass shards. Also, it prevents smash and grab cases, as a hammer would take about three or four hits to show a crack, whereas a helmet would take much longer. However, a shield for the better can be a trig- ger for the worst. Criminals love tinted glass too be- cause nobody can see their faces through the windows of their vehicles. In the home robberies in Muar, four houses in different locations were targeted in a single day. The criminals moved around the housing estates in their luxury vehicles, all with tinted windows to avoid suspicion. It can also be dangerous. One example would be the story of a child who died inside his parent’s car. The fact shows that the mother reached school at 7am and only after 1.30pm that she realised, her son was still inside the car. That was more than 6 hours after she parked the car! According to the news report, wit- nesses said they did not hear or see anyone in the car since its windows were said to be tinted. Therefore not surprisingly, there are certain rules and regulations that must be complied in installing car tints. Offenders face a penalty of a fine up to RM500.00 or a two-week jail sentence for the first of- fence. A fine of up to RM 1000.00, or a one-month jail sentence, or both can be imposed for subsequent of- fences. The Road Transport Department (JPJ) reported that more and more vehicles are fined for heavy tints every year. This can be as a result of some unscrupulous shops who advise their customers on unapproved tints. They too have their own version of rules and regula- tions which they think is the correct ones to follow. In many cases, the innocent consumers are fooled into fixing the wrong products and receive traffic compounds after that. Unfortunately, the JPJ is not empowered by the law to impose fines on tinting shops. Hence, before picking up a new “Ray-ban” for your car, it is important to know the rules and regula- tions governing car tinting. It is also important not to be influenced by any party claiming to offer tinted film with prior approval of the JPJ. Rule 5(1) and Rule 5(3) of the 2000 Amendment of the Motor Vehicle Rules (Prohibition on Specific Types of Glass) set the translucence level of the wind- shield at no less than 70% and the rear and side win- dows at no less than 50%. Take note that this includes the existing glass. In other words, the glass together with the tint film must comply with the translucence level. Exception is however given to certain vehicles under Rules 11(a) and 11(b), Motor Vehicle Rules (Prohibition on Specific Types of Glass) 1991. These are for vehicles that are used by the sultans, members of royalty, chief ministers of the states, judges, police etc. What if you do not fall under this exception but still require it for safety or medical reasons? Do not fret! Those who require it for safety or medical reasons can still apply for an exception by writing an application letter addressed to the Director-General of JPJ Malaysia and by filling up the CG1 Form. Good news! This form can be acquired from all state JPJ headquarters for free. All applications must include a certified photo- copy of the applicant’s identity card and the vehicle’s Legal Cauldron 2 of 2013 | 6 ‘...innocent consumers are fooled into fixing the wrong products and receive traffic compounds after that.’ SHEDDING LIGHT ONVEHICLETINTING By Shahman Sangaran ‘If you’re sick of feeling like an over- cooked “pisang goreng”, having your car tinted may become a necessity.’
  7. 7. registration. For applications made due to medical rea- sons, a validation letter from a government medical of- ficer and recent medical records must be enclosed. For applications made due to security reasons, an endorse- ment letter from the state police chief is required. All the applications will be processed and for- warded to the Director-General of JPJ for approval. Upon approval, a Tinted Window Permission Certificate is issued. Take note that the permission for the use of tinted windows is only for one (1) year and must be renewed. The renewal application must be made three (3) months before the duration of the initial permission is up. All the above documents are submitted again to- gether with a photocopy of the existing Tinted Window Permission Certificate. In the same vein, only buses are allowed to in- stall curtains. All other vehicles including vans are not allowed to install curtains. All in all, car tinting should fulfill its primary function to block the sun's heat and harmful UV rays, and not to be misused with unlawful heavy tinting. Hence, one should always take the extra step to be in- formed and comply with the rules and regulations gov- erning tinting in Malaysia. by Shahman Sangaran ‘…car tinting should fulfill its primary function to block the sun’s heat and harmful UV rays, and not to be mis- used with unlawful heavy tinting.’ CLUES 1. To free one from a criminal charge. 2. To disagree, usually in judgments, 3. This is the verdict given if one is proven to be at fault. 4. Where the property is “borrowed”. 5. Failure to exercise reasonable care. 6. Process of administering the estate of a deceased. 7. Court authorization to conduct a search or make an arrest. 8. Request for a change in formal decision. 9. Anything presented to support an assertion. 10. The unauthorized possession of prohibited drugs such as heroin and cocaine is … …? 11. A legal hold on a property to secure payment of debt. 12. Rejecting by exercising one’s superiority. 13. Democratic nations fight for this. 14. Someone who have seen, heard or experienced the incident or event. 15. The place where legal matters are tried. 16. French for “a superior and unexpected force”. 17. Our profession here in JHJ. 18. The unlawful killing of another human being, with intent. 19. The synonym of the words “beg” or “request”. 20. The authority to compel one’s attendance in court. Acquit,Dissent,Guilty,Lease,Negligence,Probate,Warrant,Appeal,Evidence,Illegal, Lien,Overrule,Rights,Witness,Court,ForceMajeure,Lawyer,Murder,Plea,Subpoe- na. JHJ Legal Word Search Legal Cauldron 2 of 2013 | 7
  8. 8. So, today was just like any other day where you decided to go to a mall on a weekend. You drive into the basement parking of the mall, you press on the ticket button on the machine for the parking ticket to be printed. While waiting for the machine to print the ticket, you notice a faded sign just at the side of the machine which says this:- “All motor vehicles accepted in these premises are at owners’ risk, ‘The Compa- ny’, its staff and agents undertake no responsibility and shall not be liable in any manner for any loss or damage whatsoev- er of or to the vehicle parked in these premises, its accessories or contents how- soever such loss whether caused by negli- gence or otherwise by the ‘The Company, its staff and agents.” You don’t think much of this, except that there are too many words to bother and that it probably won’t happen to you. In fact, you see signs like these all the time in different forms. The parking ticket slides out with a buzzing sound, the barrier lifts and you enter the basement. After finding a nice parking spot, just next to the entrance of the escalator, you and your family alight your car and you proceed to do your shopping. After a few hours at the mall, you head back to your car. Only to find that it has been stolen. Upon complaining furiously to the management of ‘The Company’, they direct your attention to the signboard you saw when you were waiting for the parking ticket. They tell you that from the time you entered into the premises, you have agreed to the clause stated on the sign that ‘The Company’ will not be responsible for any damage whatsoev- er whether or not caused by the negligence of ‘The Compa- ny’. Before you let your heart sink, hold on and hear us out. Does the law in Malaysia allow for someone to exclude liability for negligence by just putting up a sign like that? A sign which contains a clause, which we lawyers like to call an exclusion clause. The law is clear that for an exclusion clause to be valid, ‘The Company’ must show that the sign/clause has been displayed in a reasonably noticeable location and that it is comprehensible. So, in this case, the sign being just next to the auto- mated ticket machine when you entered into the mall and as you were waiting for the parking ticket to be printed from automated machine, you could read the sign. And essentially, you understood the contents of the said sign. But could that very signboard containing the long, uninteresting and wordy clause release ‘The Company’ of all legal responsibilities to you, as a visitor? In Malaysia, the governance of exclusion clauses has not been codified and we will have to read into case laws to decide your legal position after this terrible incident. Way back in 1959, the Privy Council had decided in the case of Sze Hai Tong Bank Ltd v Rambler Cycle Co. Ltd [1959] 25 MLJ 200, that where there is a clause which tries to exclude liability completely would be unrea- sonable. Especially where there was evidence of serious neg- ligence. So, this means that the said clause has to firstly be a reasonable clause. In another case of Sekawan Guards Sdn. Bhd v Thong Guan [1995] 1 MLJ 811, the Plaintiff had em- ployed the Defendant to provide security services to the Plaintiff's premises. A burglary had occurred at the Plaintiff's premises and the Plaintiff had sued. The Defendant in Seka- wan argued that they were not liable because there was a clause which says:- “The company shall not be liable for any loss suffered by the owner due to burglary, theft, fire, or any other cause whatsoever, unless such loss is solely caused by the negligence of the company's own employee acting in the course of their employment.” The Court said that if the Defendant wants to rely on this clause, then he is required to prove that it is applicable and they must show that they were not negligent. A case which is more similar to our current scenar- io would be the Chin Hooi Nan v. Comprehensive Au- to Restoration Service Sdn. Bhd. & Anor [1995] 2 MLJ 100. Chin Hooi Nan left his car with the defendant to be waxed and polished. When Chin came back to collect his car, he found that his car was damaged and again there was an exclusion clause at the back of the receipt, seeking to exclude the car wash of liabilities. Legal Cauldron 2 of 2013 | 8 PARK ATYOUR OWN RISK By Eunice H.S. Ong ‘But could that very signboard… release “The Company” of all legal responsibilities to you…?’
  9. 9. The High Court Judge here made it clear that an exemption clause however wide and general does not re- lease the respondents from the burden of proving that the damages caused to the car were not due to their negligence and misconduct. They must show that they had exercised due diligence and care in the handling of the car. Reading both the cases of Sekawan and Chin Hooi Nan, essentially, what I would like to share with you is:- A sign/clause like that [i.e. the exclusion clause] does not automatically release ‘The Company’ of all legal responsibili- ties towards you. They still have a duty to take the neces- sary and reasonable precautions. So, if it is a basement car park, the management will have to ensure certain security measures. And that is why you will see security guards doing their rounds when you’re parking your car at the basement car park and also you will see surveillance cameras at every corner of the mall. And if it is a car wash, they will have to show that their employees are trained and that they have reasonable checks every now and then. If it is a hotel, then again security guards will be employed and surveillance cameras will be installed. And if they can show that they have done all that they can reason- ably do and yet damage had still happened to your car, then yes, your case against the Company may not succeed. So, you ask yourself, if that’s the case, then why would anyone put up a signboard like that, attempting to exclude liability, when in law, they really can’t? Well, for this question, your guess would be as good as ours. by Eunice H.S. Ong Md Yusoff bin Ahmad v Siti Hajar bt Sarkawi & Anor [2013] 1 MLJ 329 Holding of an EGM in a different location other than the company’s registered address does not invalidate the meet- ing if the change of location does not cause undue hardship to any of the supposed attendees. It is not mandatory for a company’s EGM to be held in the registered address only. Affin Bank Bhd v Mohd Kasim Ibrahim [2013] 1 CLJ 465 In a corporate merger and acquisition exercise, all contracts of employment from the old company would be deemed to have ended, replaced by the terms of employment of the new company taking over. Hence, terms of employment would be in accordance to those of the new company. Syarikat Sesco Bhd (formerly known as Sarawak Electricity Supply Corp (SESCO)) v Yu Thian Motor Services Sdn Bhd [2013] 2 MLJ 116 Simply signing without understanding the contents of a doc- ument is a form of negligence. Terms contained in the docu- ment/agreement would be binding upon signing parties even if a third party tempered with the power meter. Dr Noor Aini Hj Sa'ari v Sa-Art Sae-Lee & Anor [2012] 3 CLJ 913 Although a doctor may refuse to fully disclose a consultancy report by reason of irrelevance or privilege, an agreement to disclose such report would include uncensored discovery of the full report. The law was concerned with substance, not form. Tan Seng Lee v Mahkamah Perusahaan Malaysia & Anor [2013] 1 AMR 846 A probationer still has the right not to be dismissed arbitrar- ily. It is the employer’s duty to show that dismissal was done with just cause and excuse. Employers must conduct due process if they intend to dismiss an employee, the same shall apply to probationers. Lim Kee Fung v Kwong Wah Yit Poh Press Bhd (Yeoh Seok Khoy, third party) [2013] 7 MLJ 91 The standard to be adopted when determining whether there was defamation is that ‘of ordinary reasonable people, of fair intelligence, who are not avid for scandal and should not be unduly suspicious’. It is sufficient for the publisher ensured that the contents were true by making sure the wordings did not affect the person concerned. Legal Cauldron 2 of 2013 | 9 ‘…if the Defendant wants to rely on this clause, then he is required to prove that it is applicable and they must show that they were not negli- gent.’ LEGAL UPDATES 2013
  10. 10. 360o JHJ 360° STUDENT ATTACHMENT PROGRAMME An ExperienceWhichWill Prepare Me For A Lifetime Like many other LLB students, I have had my share of internships or previous work experiences, in the hopes of enhancing my CV and garnering precious work experience. I have had my taste of binding, photocopying, watching lawyers in court, and the seemingly unending research which are part and parcel of being an intern at a law firm. However, none of that prepared me for the learning experience I encountered when I joined the JHJ 360˚ Student Attachment Programme. I was given a list of tasks (to complete over the next few months) which saw me taking on assignments from every department in the firm, from drafting agreements to holding Dialogues on various topics. The tasks were diverse and detail oriented, they gave me so many opportunities to get to know each area of law well enough to discover any affinity with a particular area. None of those tasks differed from what we would encounter in actual practice. And nothing speaks louder than experience. The opportunity to go to court and observe the lawyers in courtrooms – to see what really goes on in a trial, the research involved, the preparation and nerves behind it, the pride of a favourable verdict – was priceless, and drafting court documents gave me invaluable understanding and insight into the litigation process. Attending a corporate meeting gave me a glimpse into the other side of the legal world; the works outside a court room, without the ardour of litigation but which was no less intriguing. While drafting agreements, I learned just how wide the scope of corporate law is. Every agreement was different and engaging in its own way and I was exposed to so many areas in the corporate world I was previously oblivious to, or knew only little about. Being exposed to conveyancing afforded me the opportunity to see the legal world from an entirely different per- spective. Often referred to as a lawyer’s bread and butter, I learned how meticulous the process was and the arduous pa- perwork behind owning a house or property. At the same time, I could also brush up on my CLP revision through research on civil procedures, bankruptcy proceedings, and tort and land matters, which are all part of the 360˚ programme. The practical aspect of what we have only seen in revision and textbooks was etched into my memory more deeply than any amount of reading and studying could ever do. An interesting task was the dispatch task, when I was to observe the process of filing three documents. Although they were merely three short documents, the whole process took more than an hour. The amiable dispatch walked me through the whole process, taught me all about what was happening with the documents, what the filing system is and what it used to be, and the little techniques he picked up over the many years of service on how to get your documents filed faster. It made me realise just how crucial every person’s role in a law firm is, and without just one of them, a law firm would not be able to run smoothly. Finally, we were also required to hold three Dialogues on three different topics, which we presented before the rest of the firm. Although the Dialogues were on topics which I believe many in the firm had been through countless times, they still took the time out to sit through our Dialogues, listening and giving constructive opinions and responses. But at the end of the day, what makes anything work is the people involved. The best part of the programme was the people in the firm. Many of the tasks I was given were new and challenging especially to an inexperienced mind, but the willingness to help, generosity of time and camaraderie in the firm never ceases to amaze me. Lawyers, staffs, and chamber- ing students – everyone was equally busy, but never failed to take the time out to help me with any task I was working on. The five months I spent here were some of the most interesting and rewarding ones yet, and exemplified the won- derful work culture I have come to know and love at JHJ. I now leave with a much clearer sense of what the legal field is about, and an experience which will prepare me for a lifetime. By ANGELINE ANG JHJ 360˚ Student Attachment Programme Class of 2012/2013 Legal Cauldron 2 of 2013 | 10
  11. 11. With the rising price of properties in particular landed property, many of us opt for high rise building especially condominium. A condominium not only offers a sense of security since it is guarded but it also offers a feeling of per- petually being on a holiday with the Zen Garden, infinity pool, sauna, gymnasium and many other facilities. To enjoy the benefits, the residents would pay a sum of money as maintenance charges to an entity managing the condomini- um. That entity could be a Joint Management Body or a Management Corporation depending on whether the Strata Title has been issued or not. Although many of us dutifully pay the maintenance charges but what happens if you fail to pay the maintenance charges to the Management? Can your access card be deac- tivated, your access to usage of common property restrict- ed and in some instances water supply clamped? Does the Management have the power to do so and in reality how many of us actually know what the Management at a condo- minium can and cannot do? I live in a condominium and I had the above ques- tions in mind as well. There are even times when I wonder whether the Management even knows the perimeters of their power under the law. I hope that at the end of this article, many of us would know what to do next if we are faced with the same questions again. With the knowledge of law relating to this important issue, as condominium unit owners, we would be better armed to deal with any adver- sities that we may face. Now, before we discuss what the Management can and cannot do, we need to know the difference between a Joint Management Body and a Management Corporation because they are governed by different laws. A Joint Management Body is established within 12 months from the delivery of the vacant possession at the first general meeting which comprise representatives of the developer and unit owners. The Joint Management Body is regulated by the Building and Common Property (Maintenance and Management) Act 2007. Meanwhile, a Management Corporation is estab- lished once the strata titles of a building are issued and it is regulated by the Strata Titles Act 1985. Essentially, both the Joint Management Body and Management Corporation have similar powers and duties. For the purposes of this article, I will look into the powers and duties of a Management Cor- poration in answering the questions posed earlier. The Management Corporation is given powers by the Strata Titles Act 1985 to collect money known as maintenance charges/fund from unit owners in order to properly manage and maintain the common property as well as carry out its duties under the said Act. This is where the problem arises. Although many of us pay the monthly maintenance charges diligently so that the condominium could be maintained and kept in good condition, there are others who do not make the payment either willfully or due to a dispute to the amount. In response to such a default, many Management Corporations would chose to deactivate the access card so that the unit owner won’t be able to park their vehicle or even deny access to usage of the common property. But, where do they get the powers to do so? The Management Corporation usually relies on the house rules to show that they do have the power to deactivate the ac- cess card if there is a default of the maintenance charges. Pursuant to Section 44(2) of the Strata Titles Act 1985, the Management Corporation may by special resolution, make additional by-laws, or make amendments to such additional by-laws, not inconsistent with the by-laws set out in the Third Schedule of the Act, for regulating the control, man- agement, administration, use and enjoyment of the subdivid- ed building. This shows that the Management Corporation can make house rules as long as it does not contravene with the Act and many a times the house rules would state that the Management Corporation can deactivate the access card if there was a default in the payment of the maintenance charges. Does that mean that the Management Corporation can deactivate the access card so as to prevent unit owners from parking their vehicle in the parking bay? The answer is no. The Management Corporation does not have the power Legal Cauldron 2 of 2013 | 11 ‘The Management Corporation usual- ly relies on the house rules to show that they have the power to deacti- vate the access card…’ THE POWERS OF A MANAGEMENT CORPORATION By Barvina Punnusamy ‘…but what happens if you fail to pay the maintenance charges to the Management?’
  12. 12. to prevent unit owners from entering into the parking premises in order to park their vehicle. This is because as unit owners, they also have proprietary interest over the parking bay since it is normally registered as accessary par- cel in the title. If you have a proprietary interest over the parking bay then you ought to have unrestricted access to the parking bay which means that the Management Corpo- ration cannot stop you from entering into the parking prem- ises. This issue was decided by the High Court in the case of John Denis de Silva v Crescent Court Manage- ment Corp [2006] 3 MLJ 631 where it was held that the Plaintiff i.e. unit owner in a condominium had proprietary interest in land over the car park bay and the Plaintiff had ownership or the legal title over the unit and the proprie- tary interest in the car park bay flowed with that of the unit. It was further decided that even if the Plaintiff did not pay his water charges and did not display a valid motor car sticker to the windscreen of his motorcar, he should be allowed entry into the compound while driving his motorcar and he should be allowed to park at the parking bay allocat- ed to him. The Judge had also stated that in dealing with default of maintenance charges payment, the Management Corporation has to abide by the Act and that would be to file an action for recovery of the debt against the unit own- ers in Court. Therefore, the next time your Management Cor- poration threatens to prevent access to your parking bay, you know that you ought to have unrestricted access to the parking bay and they cannot prevent you from entering the compound. But, be that as it may, you still have an obliga- tion to pay the maintenance charges to the Management Corporation and they can file a claim in Court to recover the outstanding sum. Or worse, Land Administrator may, upon sworn application in writing made by any member of the council of the Management Corporation issue a warrant of attachment authorizing the attachment of any movable property belonging to the defaulting proprietor. So to avoid the above, it is best to pay the maintenance charges on time. Or maybe it is time that we participate actively in the meetings conducted by the Management Corporation so that we can ensure that they act within the ambit of their powers. by Barvina Punnusamy Legal Cauldron 2 of 2013 | 12 ‘As unit owners, they also have propri- etary interest over the parking bay…’ JHJ Parliamentary Style Debate
  13. 13. 360o JHJ 360° STUDENT ATTACHMENT PROGRAMME The Empowerment of Practical Experience When I was having my break during a CLP class, a lecturer came into the lecture hall briefly and told the class about the JHJ 360˚ Student Attachment Pro- gramme. The programme was described as one which offers a series of tasks and op- portunities for the law students to expose themselves to the legal practice. Curiosity about the practical aspects of conflict resolution and the court processes had driven me to apply for the position of an attachment student, and I was subsequently chosen to participate in this programme. Prior to joining the programme, I have never set foot in a court before. It had always been a wish of mine to watch how lawyers represent their clients in court. As attending court proceedings were also part of the tasks within the programme’s schedule, it afforded me the chance to attend court with some of the lawyers and learn how a case management, hearing and trial is done in practice. Surprisingly, what I expected of a trial in court was so different from what I had seen on TV. The law- yers were not as aggressive as I thought they would be. To the contrary, they were very respectful and courteous in court. The lawyers’ confidence in presenting their arguments and the ability to defend their clients while gracefully handling questions put forth by the judge further fuelled my enthusiasm to join the legal practice. Neither my Degree course nor the Certificate in Legal Practice (CLP) course exposed me to skills such as agreement drafting. Here, I had the opportunity to draft various types of agreement ranging from a Sale and Purchase Agreement to a Mining Concession Agreement. No doubt that it was a challenging task, as I would have to identify all essential clauses in the given agreement (for example the default and termination clauses) in order to secure the client’s interests in the event of a misfortune or dispute. The best advice that was given to me by the JHJ team was to al- ways put myself in the client’s shoes while drafting an agreement, or before proceeding with any action for that matter. Furthermore, I realised that being a qualified lawyer would not equate to being a capable lawyer if one had only mastered the hard skills (i.e. specific teachable abilities) in practicing law. Sir Francis Bacon in the Meditations Sacrae famous- ly endorsed the notion of “Knowledge is Power”. Through conducting Dialogue sessions on several topics with the JHJ team, I learnt that holistic knowledge in a profession would mean that it is equally important to have skills such as good time management and good interpersonal aptitude apart from the mastery of hard skills alone. Being able to brand oneself well on a professional front works hand in hand with the hard skills to form the knowledge crucial for a successful and competent legal practitioner. All these skills would never have been taught academically, and could only be learned and mastered through real working experience. Spending my 5 months in JHJ was a decision that I would never regret making, and it is perhaps one of the most unforgettable experience in my life. The JHJ team have been very helpful in times of difficulties. They were always passion- ate in helping me overcome the hiccups throughout the duration of my participation in this programme. Due to the fact that this student attachment programme is tailored to expose law students to the realities and practicalities of the legal arena in our country, I have truly gained invaluable experiences from the JHJ 360˚ Student Attachment Programme which I believe would be of tremendous assistance to my future career. By CHERYL CHONG JHJ 360˚ Student Attachment Programme Class of 2012/2013 Legal Cauldron 2 of 2013 | 13
  14. 14. “Force Majeure” is an expression of French origin which ac- cording to Merriam-Webster means “... an event or effect that cannot be reasonably anticipated or controlled ...” To the unfamiliar, the presence of a Force Majeure clause in a contract often causes some form of fear or un- certainty and if not eradicated, such fear or uncertainty may lead to the abandonment of a perfectly fair and sound con- tract. Hence, it is essential for those involved in commercial transactions to understand the purpose and effect of this clause. In law, a contract can be discharged by frustration and a contract is deemed frustrated when a supervening event occurs that renders the performance thereof impossi- ble. Under such circumstances the contract comes to an end as an agreement to do an impossible act is void (see: s.57 of the Contracts Act 1950) and if such supervening event can be proven to be beyond the reasonable knowledge or anticipation of the parties, then no compensa- tion can be claimed by the aggrieved contracting party. The recent Fukushima earthquake and tsunami in Japan, the floods in Australia and the war in Syria are prime examples of a supervening event. This may not be the best recourse for the con- tracting parties especially when the supervening event is only temporary in nature as millions may be lost if a con- tract is rendered void by frustration. For many, such cir- cumstances will likely cause their downfall. This is where the Force Majeure clause can come into play. In essence, the Force Majeure clause is a creature of contract and is subject to the usual rules of contract con- struction. Designed to overcome the limitations of the law, if properly drafted, a Force Majeure clause can prevent the scenario above from occurring. A Force Majeure clause provides that one or both parties can cancel a contract or be excused from either part or complete performance of the contract upon the occur- rence of a certain specified supervening event (or events) which is beyond the parties’ control. Sometimes the Force Majeure clause will entitle one or both parties to temporari- ly suspend performance or to seek an extension of time for performance. Unlike frustration, therefore, a Force Majeure clause will not always bring a contract to an end if the Force Majeure clause provides otherwise. Composition of a Force Majeure clause There is no definition for the word “impossible” or the supervening event in the Contracts Act of 1950. Instead, this is done contractually through the Force Majeure clause whereby a series of specified events or circumstances will be listed which parties to a contract can treat as the superven- ing event or supervening events. A well-drafted Force Majeure clause should feature the following:  the specific events that will trigger the operation of the clause, together with a general provision designed to cover events that are not expressly listed;  what the parties are obliged to do in terms of relying on a Force Majeure event;  the consequences of an Force Majeure occurrence i.e. defences/remedies available to the parties In specifying the events of Force Majeure, a Force Majeure clause should define the supervening events it is intended to cover. Although such events will differ according to the type of contract, the types of specific event that are normally listed in a Force Majeure clause include an act of God (this may cover extreme weather conditions such as floods), war or threat of war, terrorist act, blockade, revolu- tion, riot, civil commotion, fire, industrial action, lockout, strike and anything beyond the reasonable control of the parties. Relying on the Force Majeure clause In the case of Malaysia Land Properties Sdn Bhd vs Tan Peng Soo (2013) 1 MLRA, it was held that the “Force Legal Cauldron 2 of 2013 | 14 ‘…the Force Majeure clause is a creature of contract and is subject to the usual rules of contract construction.’ UNDERSTANDING FORCE MAJEURE IN COMMERCIAL CONTRACTS By Adrian Low ‘To the unfamiliar, the presence of a Force Majeure clause in a contract often causes some form of fear…’
  15. 15. Majeure” was not limited to the general notion of lockout, act of God, strikes, riots, civil, commotion, general chaos and inclement weather only. While it does not encompass conditions of business or economic climate leading to a de- pressed economy, it would include dislocation of business by various actions and events. In this case, a certificate is- sued by an architect under certain given conditions pursuant to a Force Majeure clause in a Sale and Purchase Agreement was deemed to be an event of Force Majeure. Conclusion A Force Majeure clause is essential in any commer- cial contract and if properly drafted, it can prove pivotal in ensuring the interests of the parties are catered for when an unexpected supervening event occurs. by Adrian Low Legal Cauldron 2 of 2013 | 15 ‘…a Force Majeure clause will not al- ways bring a contract to an end if the Force Majeure clause provides otherwise.’ Mission Snippets Give a Home a Library Quotes OfThe Day “Life is a series of experiences, each one of which makes us bigger, even though sometimes it is hard to realize this. For the world was built to develop character, and we must learn that the setbacks and grieves which we endure help us in our marching onward.” ― Henry Ford “The learning and knowledge that we have, is, at the most, but little compared with that of which we are ignorant.” ― Khalil Gibran “If you find it in your heart to care for somebody else, you will have succeeded.” ― Maya Angelou “Nothing stops the man who desires to achieve. Every ob- stacle is simply a course to develop his achievement muscle. It’s a strengthening of his powers of accomplishment.” ― Eric Butterworth
  16. 16. Kuala Lumpur . Petaling Jaya . Kota Bharu . Melaka This is a publication produced by the JHJ Knowledge Department. For any inquiries, please do not hesitate to contact us: T: 03-2096 1478 | F: 03-2096 1480 | E: | W: Publisher: Messrs Jayadeep Hari & Jamil, Suite 2.03 (2nd Floor), Block A, Plaza Damansara, Bukit Damansara, 50490 KL. Printers: Pressworks Enterprise, No 20, Jalan Usaha Satu 25/2A, 40400 Shah Alam.