HONG LEONG ASSURANCE BHD v. PHUN YOON HOON

CLJ
Legal Network Series
   
HONG LEONG ASSURANCE BHD                                                                              ...PLAINTIF
PHUN YOON HOON                                                                                                  ...DEFENDAN
INTRODUCTION
[1] This is an appeal filed by the Plaintiff after this Court had dismissed the Plaintiff's claims against the Defendant with costs.

BRIEF FACTS
[2] Facts of the case can be summarised as follows:
i. On the Defendant's request, the Plaintiff had rendered its service of life insurance known as "HLA Wealth Plan" with "Wealth Booster Rider (30-year term) to the Defendant.
ii. For the year 2022, the Defendant has failed to make payments of scheduled premiums for the year and subsequently the Policy has been considered as lapsed.
iii. Soon after, the Defendant had requested the Plaintiff to reinstate the Policy. However, the request was rejected mainly due to the health reason, i.e Defendant has 4th stage lung cancer.
iv. Arising from the above and after several discussions, the Plaintiff had on, a goodwill basis and with no admission of liability, had suggested an exceptional arrangement to pay a surrender value subject to the Defendant making an application to surrender the Policy.
v. The Plaintiff had on 16.12.2022 made the payment of the surrender value in the sum of RM 187,375.87 to the Defendant's account after the Plaintiff received of the aforesaid surrender form from Defendant.
vi. However, after the payment of the Paid Surrender Sum is made to the Defendant, the Plaintiff had realized that it had made an inadvertent mistake in its calculation method. The actual surrender value that should be paid to the Defendant pursuant to the aforesaid arrangement is RM133,400.13 and hence Plaintiff has overpaid Defendant of RM53,975.74.
vii. The Plaintiff had repeatedly demanded the Defendant to refund the Overpaid Sum, but the Defendant refused. The Defendant maintained that she has accepted the arrangement with a good faith and at all material time, it is the Plaintiff who proposed for the abovesaid exceptional arrangement and settlement. Defendant also has never requested or proposed as such.
viii. The Defendant's counter claim is premised on the Plaintiff's alleged conduct and/or action in making periodic telephone calls to the Defendant particularly during the Defendant's recuperating period, in which the same is alleged to tantamount to harassment.
ix. The Defendant is now seeking for general damages and aggravated and/or exemplary damages to be assessed by the Court.
x. The Plaintiff has called two (2) witnesses to support and strengthen its claim. There are:
Foo Siu Ling (Plaintiff First Witness - SP1)
Manager, Actuarial & Strategic Development of Hong Leong Assurance Bhd.
Lim Lee Peng (Plaintiff Second Witness - SP2)
Manager, Customer Care of Hong Leong Assurance Bhd.
xi. Whereas the Defendant has called only one witness, ie the Defendant herself in this suit.

ISSUES TO BE TRIED
[3] In this case, parties had agreed to focus on five (5) main issues to be tried by this Court as per Enclosure 34. The issues are:
i) Sama ada bayaran RM187,375-87 tersebut adalah berdasarkan satu penyelesaian baru atau nilai serahan.
ii) Jika berdasarkan nilai serahan, sama ada jumlah RM133,400-13 adalah jumlah yang harus dibayar kepada Defendan.
iii) sama ada Defendan mempunyai kewajipan di bawah seksyen 73 Akta Kontrak 1950 dan/atau bawah prinsip wang dipunyai dan diterima ('money had and received') untuk membayar semula ('refund') Jumlah sebanyak RM53,975-74 kepada Plaintif.
iv) Sama ada Defendan telah berjaya menunjukkan perubahan kedudukan dalam undang-undang 'common law'
v) Sama ada Plaintif telah menyebabkan kegangguan (harrassment) kepada Defendan.
Jika ya, sama ada Defendan berhak untuk tuntutan ganti rugi ditaksirkan.
[4] This Court is guided by but not limited with the agreed issues in determining, on the balance of probabilities, claims made by the Plaintiff against the Defendant and counter claims made by the Defendant against the Plaintiff.

LAW ON EVIDENCE
[5] It is trite that the Plaintiff and Defendant have the legal burden to prove its claim and counterclaim respectively, as prescribed by sections 101 and 102 of the Evidence Act, which read:
i) 101 Burden of proof
(1) Whoever desires any court to give judgment as to any legal right or liability, dependent on the existence of facts which he asserts, must prove that those facts exist.
(2) When a person is bound to prove the existence of any fact, it is said that the burden of proof lies on that person.
ii) 102 On whom burden of proof lies
The burden of proof in a suit or proceeding lies on that person who would fail if no evidence at all were given on either side.
[6] This was explained in a Federal Court case "HONG YIK TRADING V. LIZIZ PLANTATION SDN BHD [2017] 8 CLJ 491", in the following words:
"It is settled law that the burden of proof rests throughout the trial on the party who asserts that the facts exist (section 101 of the Evidence Act 1950). Where a party on whom the burden of proof lies has discharged that burden, then the evidential burden shifts to the other party. However, if the party on whom the burden of proof lies fails to discharge it, the other party need not call any evidence."
[7] Reference is also made to the case of "GERARD JUDE TIMOTHY PEREIRA V. KASI A/L KL PALANIAPPAN [2017] CLJU 889" whereby it was held by the Court of Appeal that:
"As rightly pointed out by the learned trial judge himself, in a civil case the plaintiff bears both the legal and evidential burden of proof (see ss. 101 and 103 Evidence Act 1950). It is also trite law that legal burden is imposed by law and remains with the plaintiff throughout the trial and never shifts to the defendant. On the other hand, evidential burden moves to and fro between the plaintiff and the defendant depending on the state of the evidence introduced at any one stage of the trial, and unless and until the plaintiff discharges his evidential burden by establishing a prima facie case, there is no burden on the defendant to prove his defence, no matter how weak his defence might be."

THE PLAINTIFF'S CLAIM AGAINST THE DEFENDANT
[8] The Plaintiff's claims against the Defendant are premised on the Defendant's obligation in law and in fact to refund a sum of RM53,975.74 (the "Overpaid Sum"), which has been paid by the Plaintiff to the Defendant on a mistake made by the Plaintiff in arriving to the same under:
i) section 73 of the Contracts Act 1950; and/or
ii) the common law principle of 'money had and received'.
[9] The Plaintiff admitted that the Plaintiff had made mistakes in its calculation, thus arriving at the Paid Surrender Sum of RM187,375.87, instead of the Actual Net Surrender Value of RM133,400.13 when it paid the surrender value to the Defendant pursuant to the exceptional arrangement suggested by the Plaintiff which is agreed upon by the Defendant.
[10] For clarity, I reproduced Plaintiff's explanation on how the mistakes was made during the Plaintiff's calculation:
i. the net surrender value payable to the Defendant is the Total Surrender Value ("TSV") less the reinstatement costs.
ii. there are 4 items that made up the TSV - namely (1) guaranteed cash surrender value, (2) cash payment declared on 28.6.2022, (3) cash dividend declared on 28.6.2022, and (4) terminal dividend.
iii. in the course of calculation of TSV, the CSIU team of the Plaintiff (being SP2's department) had on a mistaken basis treated the asset share value ("ASV") (albeit not specified in the calculation worksheet in B: 111) as terminal dividend value ("TDV").
iv. for clarity, the ASV represents the Policy's share of the underlying participating fund, but in contrast, the TDV is the excess amount of 90% of the residual ASV (i.e. ASV less all insurance payments including all regular cash dividends and cash payments), over the guaranteed cash surrender value.
v. in arriving at the TSV, Plaintiff must pay at least 90% of the residual ASV on aggregate for each cohort, as the Policy was surrendered in the 7th year of the policy [see paragraph 10.6(b) at B: pp. 189-190]. In accordance with the provision of bonus at B: pp.122 and 155, the TDV is calculated as the difference between residual ASV and the guaranteed cash surrender value.

"Section 73 of the Contracts Act 1950"
[11] It was a pleaded case by the Plaintiff that the payment of the Overpaid Sum of RM 53,975.74 to the Defendant is an inadvertent mistake by the Plaintiff in its calculation. Thus, section 73 of the Act is applicable and Defendant is obliged to repay the mistaken amount paid.
[12] Section 73 of the Contracts Act 1950 provides:
"A person to whom money has been paid, or anything delivered, by mistake or under coercion, must repay or return it."
[13] To begin with, the greater concern before this Court is whether the payment to the Defendant may safely be categorized as a case where "money has been paid... by mistake" for the purposes of s. 73 CA, which is essential if the Plaintiff is to succeed under this head.
[14] In the case of "MALAYAN BANKING BHD v. CHING SUIT FEE [2012] 3 CLJ 606", it was held that:
"[16]Section 73 of the Contracts Act 1950 applies both to mistake of fact as well as mistake of law. The Privy Council in the case of Shiba Prasad Singh v. Chandra Nandi [1949] LR 76 IA 244 when construing payment by mistake under s. 72 of the Indian Contracts Act which is in pari materia with our s. 73 stated that it must refer to a payment which was not due and which could not have been enforced. The mistake is in thinking that the money paid was due when in fact it was not due."
[15] The underlying principle enshrined in the passage above is that section 73 of the Act refers to a payment of money that has been mistakenly made or paid, and not the mistake in calculation of the money paid. Hence, section 73 is only applicable if the Plaintiff, for example, has transferred or paid to the wrong person not the Defendant, or clerical mistake in the amount transferred due to incorrect numbers key in/written or incorrect account number. The mistake is pertaining to the payment, not the calculation mistake prior to the intended payment.
[16] However, in the present case, it is undisputed facts that:
i. The Plaintiff agreed to pay an amount of RM187,300.00 to the Defendant.
ii. The said amount has been communicated to the Defendant via an email dated 17.11.2022.
iii. The Defendant has complied with the Plaintiff's direction to surrender the Policy and to furnish a copy of bank statement/account and other documents needed by the Plaintiff on 23.11.2022.
iv. The Plaintiff again communicated with the Defendant on 16.12.2022 informing that the money has been paid to the Defendant (with an extra of RM 75.87) as agreed earlier.
v. The exceptional arrangement and the settlement amount are entirely within control and discretion of the Plaintiff.
vi. The Plaintiff admitted that there is no fraud or coercion by the Defendant.
[17] SP2 during cross examination testified that:
Q- Ms Lim, my next question to you. So, do you agree that on 16/12/2022, the Plaintiff, which is Hong Leong Assurance, told the Defendant that "I will pay you RM187,375.87" and the Defendant only received what she was represented to?
A- Based on the email, yes.
Q- So, she was only getting what she was told by Hong Leong Assurance, correct?
A- That time, yes. At that time.
[18] On this point, this Court would refer to the case of "RHB BANK BHD v. RICHLAND LEISURE GROUP SDN BHD; NG SEANG HENG (THIRD PARTY) [2024] 2 CLJ 871" where it was held:
"From this formidable line of authority certain simple principles can, in my judgment, be deduced.
1. If a person pays money to another under a mistake of fact which causes him to make the payment, he is prima facie entitled to recover it as money paid under a mistake of fact.
2. His claim may however fail if:
a) the payer intends that the payee shall have the money at all events, whether the fact be true or false, or is deemed in law so to intend;"
[19] Therefore, it is safely concluded that there is no mistake at all in the payment made by the Plaintiff. The recipient is the correct and intended person, the amount stated in the e-mail also is the correct (only with additional amount of RM 75.87) amount paid to the Defendant and the bank account number also belonged to the Defendant.
[20] Based on the abovesaid finding, the Court is bound by the decision and guided by principles laid down by the case of "MALAYAN BANKING BHD V. CHING SUIT FEE" (supra) where the Federal Court says:
"[17] Based on the principles of law as laid down in the above cited case authorities, it is our considered view for the present case that there was no payment by mistake to the respondent because the payment made was in fact due to the respondent under the letter of credit. There is no equitable ground to hold that the money has been paid by mistake. There was also no fraud on the part of the respondent during her receipt of the payment. The appellant had in fact represented to the respondent that the respondent was entitled to the payment. By doing so the appellant is estopped from seeking a refund. On this point we would refer to the case of Holt & Ors. v. Markham [1922] All ER 134 wherein Scrutton LJ at p. 141 held:
"I think this is a simple case of estoppel. In this case the plaintiffs have, in my view, represented to the defendant that he is entitled to a sum of money as a gratuity and have paid it, and after a lapse of time sufficient to enable mistake to be detected and rectified, the defendant has acted on the representation and has spent the money before any claim on him for return has been made.""
[21] Based on the facts presented before the Court, the Defendant had asked for her Policy to be revived, but was rejected by the Plaintiff via a letter dated 4th July 2022. Arising from the rejection by the Plaintiff, the Plaintiff has initiated series of meetings and discussions with the Defendant. Later, the Plaintiff and the Defendant has agreed for an exceptional arrangement as mentioned earlier.
[22] This exceptional arrangement on a goodwill basis has been canvassed into a writing and conveyed to the Defendant via email on 17.11.2022. The Plaintiff has received Surrender Form from the Defendant on 23.11.2022. On 16.12.2022, Plaintiff has informed the Defendant that the amount of RM 187,375.87 has been credited into her account.
[23] From the timeline mentioned above i.e from July 2022 until November 2022 and before the payment was made in December 2022, Plaintiff has reasonable and sufficient time to look into the figures, analysing data and ensuring the correct method and calculation before finalising the amount to be paid. In short, there is no room for the Plaintiff to commit a fundamental error of such immense amount since the Plaintiff is the one proposing the said scheme of exceptional arrangement and has all the data and information needed.
[24] In the case of "HIAP-TAIH WELDING & CONSTRUCTION SDN BHD & ANOR v. BOUSTEAD PELITA TINJAR SDN BHD [2014] CLJU 267", it was held by the Court of Appeal that:
"[21] We will now consider whether, as argued by learned counsel for the plaintiff, the 2nd defendant is liable to return the sum of RM373,488.31 and the alleged excess payment of RM136,057.63 to the plaintiff by virtue of section 73 of the Contracts Acts 1950 ("CA") which provides:
"73. Liability of person to whom money is paid, or thing delivered, by mistake or under coercion.
A person to whom money has been paid, or anything delivered, by mistake or under coercion, must repay or return it."
[22] We noted that this issue was never raised by the plaintiff in the Originating Summons or the affidavit in support. Even so, it is now the submission of learned counsel for the plaintiff that since the money was paid to the 2nd defendant under a mistake of fact, the plaintiff is entitled to recover it from the 2nd defendant. We do not agree with this submission. As acknowledged in paragraphs 7, 7.1 and 8 of the plaintiff's affidavit in support, the initial payment of RM373,488.31 was paid voluntarily by the plaintiff based on their own assessment and it was then treated as interim payment and accepted without prejudice. Furthermore, any payment to the 2nd defendant, including the alleged excess payment of RM136,057.63 was made pursuant to a valid final arbitration award, which was eventually registered in Kuching High Court for enforcement. That being the case, there is no element of mistake in relation to the various payments made to the 2nd defendant. In our view, the provisions of section 73 of CA have no application in the present case."
[25] This Court also further refers to the Court of Appeal judgement in the case of "MALAYAN BANKING BHD v. CHARANJEET KAUR KANG SUKHBIR SINGH & ANOR [2017] 6 CLJ 617" whereby it was decided that:
"[58] Relying on the case of Borneo Motors (supra), the plaintiff submitted before us that "as long (as) there is a mistake, that is sufficient and the law does not punish the payer for their negligence or carelessness".
[59] However, in Borneo Motors, the mistake of fact related to the covenant in cl. 4(4) of the agreement between the parties, that the plaintiffs would pay the defendant for electricity supplied should a meter be installed by the Public Utilities Board. The plaintiff made payments to the defendant under the mistaken belief that such a meter was installed. In other words, there was first a mistake as to the existence of a covenanted fact, and that mistake resulted in payments being made. The negligence or carelessness attributable to the plaintiff was in not verifying whether there was such installation.
[60] In the case before us, there was no such mistake of fact. There was just mere carelessness/ negligence. The sum of €162,373 was transferred to Emdad when there were sufficient funds in the FCA account. There was no mistake there. The subsequent payments were not the subject matter of the claim."
[26] In the case of "BANK SIMPANAN NASIONAL v. RUDYSHAM ABDUL RAOF [2017] 4 CLJ 234", the brief fact is that the Plaintiff had issued a full settlement letter to the Defendant dated 26 March 2008 purportedly confirming full settlement of the loan. However, the letter was written in error because the respondent still owed the appellant a shortfall, which amount as at 28 December 2012 was RM95,923.27.
[27] In that case, it was held, among others:
"[72] The second reason is that the four cases do not truly assist the case of the appellant. This is apparent even based on the passages quoted by the appellant in its written submissions. Firstly, in the Court of Appeal decision in Soon Lee Huat Palm Oil Mill Sdn Bhd v. Stable-Win Sdn Bhd [2013] 4 CLJ 640; [2013] MLJU 257 it was held as follows:
[27] The difference between a mistake of fact and a mistake of law is very clear. To put it simply, mistake of fact is a mistake not caused by the neglect of a legal duty on the part of the person making the mistake, and consisting in (1) an unconscious ignorance or forgetfulness of a fact, past or present, material to the contract; or (2) belief in the present existence of a thing material to the contract which does not exist, or in the past existence of such a thing which has not existed. Whereas, a mistake of law happens when a party, having full knowledge of the facts, comes to an erroneous conclusion as to their legal effect. It is a mistaken opinion or inference, arising from an imperfect or incorrect exercise of the judgment, upon facts, and necessarily presupposes that the person forming it is in full possession of the facts
[73] In my view, it would be incongruous to attribute to the appellant, an established banking institution created by an Act of Parliament, the subjective state of mind concerning unconscious ignorance, forgetfulness or belief in the present existence of a matter which does not exist. If the alleged mistake is attributed to an individual, neither did the appellant identify the person responsible for the same, and show whether he or she had been made accountable for the lapse. In any event, it has also not been demonstrated by sufficient evidence as to how the mistake came about, and whether it was in the nature of a mistake of fact stated by the Court of Appeal."
[82] Further, taking the appellant's case at its highest, even if it was true that the full settlement letter was a mistake, as mentioned earlier, it cannot be validly characterised to be in the nature of a simple mistake like a typing error. It was beyond an innocent mistake. It is clearly negligent for a banking institution like the appellant to have committed a fundamental mistake of such colossal proportion. The banking industry is one of the most strictly regulated industries; and internal controls and governance process are similarly expected to exhibit stringent adherence to standard operating procedures.
[83] It was almost unthinkable for a bank to have allowed a clearly written full release letter to be issued in error. The letter must have been written with the benefit of supporting documents including the relevant credit files. It is, to put it mildly, especially surprising that the full settlement letter was then acted on by the valid execution of the deed of receipt and reassignment by the authorised signatories for the appellant bank for this purpose. Surely such an important documentation releasing security of the bank would have necessitated a careful review of the true status of the loan.
[85] All relevant information must have certainly been within the internal information management system and credit files of the appellant to start with. If there was a mistake the necessary evaluation and review prior to execution appeared not to have been done in a manner befitting of a financial institution, or at all.
[88] It is also my finding that the appellant is additionally subject to the trite principle of law that a party cannot benefit from his own wrong or default, which in this case, being the negligent mistake by the appellant. It is an established presumption in law that parties to a contract do not intend that either party should be able rely on its own breach of obligations to avoid a contract or obtain any benefit under it, unless the contrary is clearly provided for by the contract."
[28] For these reasons, this Court held that payment of money by the Plaintiff to the Defendant was not a mistake of fact or mistake of law as provided under section 73 of the Contracts Act. The payment of the said amount was made with full knowledge and conscience since it was proposed by the Plaintiff itself. The calculation error of the amount paid is not within the purview of section 73 of the Contracts Act.
"Money Had and Received"
[29] Should I be mistaken in my determination and finding on the application of section 73 of the Act as I had discussed earlier, I now turn to address the issue of whether the common law principle of 'money had and received' is applicable in favour of Plaintiff in this action.
[30] In its statement of claim, the Plaintiff had argued that its claims against the Defendant is also well founded under common law principle of 'money had and received'. This principle of money had and received has been explained in "BUMIPUTRA-COMMERCE BANK BHD v. SITI FATIMAH MOHD ZAIN [2011] 2 CLJ 545". The Court says:
"[12] Payments made under a mistake of fact are commonly recovered through an action for monies had and received. Lord Mansfield in Moses v. Macferlan [1760] 2 Burr. 1055 stated that the action for money had and received will only lie when it is inequitable for the defendant to retain the money which the plaintiff claims (see Goff & Jones, The Law of Restitution, 6th ed (2002) at p 821, para 40-001). Lord Mansfield explained that "the gist of this kind of action is that the defendant, upon the circumstances of the case, is obliged by the ties of natural justice and equity to refund the money" (at p 1012; see also Chitty on Contracts, General Principles, vol. 1, 28th ed (1999) at p 1467, para 30-010)."
[31] In the case of "BANK BUMIPUTRA MALAYSIA BHD v. HASHBUDIN HASHIM [1998] 2 CLJ SUPP 332", it was held that:
"The rationale in an action for money had and received was established by Lord Mansfield 238 years ago in Moses v. Macferlan [1760] 2 Burr 1005. The relevant part of the judgment was quoted in Chitty on Contracts, General Principle (27 edn, vol. 1, Sweet & Maxwell 1994) at p. 1388:
This kind of equitable action to recover back money which ought not in justice to be kept is very beneficial and therefore much encouraged. It lies for money which, ex-aequo et bono, the defendant ought to refund; it does not lie for money paid by the plaintiff, which is claimed of him as payable in point of honour and honesty;.... [T]he gist of this kind of action is that the defendant, upon the circumstances of the case, is obliged by the ties of natural justice and equity to refund the money."
[32] Therefore, the question to be determined is - has the Defendant received the Plaintiff's money under such circumstances that natural justice and equity would require a refund?
[33] This Court is not persuaded with the Plaintiff's position that the Defendant is required under equitable law to refund the money she had and received from Plaintiff. The main reason is that the money paid to her is not tainted with any fraudulent or misrepresentation from Defendant at all. It is all within Plaintiff's prerogative and consideration in proposing the settlement amount to the Defendant and subsequently paid by the Plaintiff.
[34] In the case of "AMBANK (M) BERHAD v. KB LEISURE (M) SDN BHD [2011] CLJU 764", the Court has concluded that:
"Having reviewed the totality of the evidence, I would conclude that the Defendant has not been unjustly enriched at the expense of the Plaintiff and therefore need not make refund to the Plaintiff. My reasons are as follows:
1.
2. The Plaintiff has not established in evidence that the Defendant had, or could have had, any knowledge whatsoever as to the fraudulent means by which the genuine Cashier's Orders were raised. In the absence of knowledge on the part of the Defendant, natural justice and equity would not require the Defendant to refund the Plaintiff."
[35] Hence, applying the principle mentioned above, the Defendant is not involved at all with the calculation and has not played any role except attending discussions with Plaintiff and furnishing all document needed by the Plaintiff. She also was not informed how the Plaintiff arrived at the settlement figure.
[36] She only came to know the settlement figure after Plaintiff updated and informed her via e-mail dated 17.11.2022 that the Plaintiff has agreed to pay her the settlement amount of RM 187,300.00. Thus, with the Defendant's lack of knowledge pertaining to the calculation of the settlement figure as proposed and paid by the Plaintiff, this Court is not inclined to order The Defendant to repay or refund the money under the common law principle of "money had and received".
"Settlement Amount"
[37] In the present case, SP1 admitted that the exact figure of the Asset Share Value (ASV) was not mentioned anywhere in the exhibits and/or documents filed in this Court.
[38] SP1 in her statement said that in the course of calculation of Total Surrender Value (TSV), the CSIU team of the Plaintiff had on a mistaken basis treated the ASV as Terminal Dividend Value ("TDV"). SP1 testified:
Q- Alright. So, according to your witness statement, according to your witness statement, "Residual asset share value is asset share value net of all insurance payments including all regular cash dividends and cash payment." So, my question to you, "Where is it stated here the exact figure of the asset share value?"
A- It's not stated in this paper.
Q- No, I am asking you without the figures. Just now you have said that there are no figures. I mean, the asset share value, the exact figure of the asset share value is not stated on this paper, is that correct?
A- Yes, correct.
[39] Based on the answer given above by the SP1, it is almost impossible for the Court to ascertain and verify reason put forward by the Plaintiff that the mistake (as they claimed), is deriving from CSIU team mistakenly treated and stated the Asset Share Value (ASV) as Terminal Dividend Value ("TDV"). Since there is nowhere ASV figure stated in any document before the Court, so how for this Court to ensure or verify that the TDV figure is different or otherwise similar with ASV figure. It is for the Plaintiff to prove what it asserted.
[40] Nevertheless, regardless of the non-existence ASV figure in the calculation, this Court is in the opinion that since the settlement is founded on an exceptional arrangement and on goodwill basis, this Court is not in the position to declare that the amount paid is correct or incorrect. It is purely and entirely within Plaintiff discretion to offer any settlement figure to the Defendant.
[41] There is nothing in the email dated 17.11.2022 that makes any reference to any term stated in the Policy that has already lapsed and has not been revived. All the terms and scenarios under the exceptional arrangement are depending on the goodwill and discretionary terms that has been discussed and decided internally by the Plaintiff.
[42] This Court also believes that the Plaintiff is not bound to make use Actuarial Certificates available in the Policy as their basis of calculation since the Policy already lapsed. It is up to the Plaintiff to use or not to use the calculation method stated there in the Policy. It can be used as their guideline in formulating the settlement amount under the exceptional arrangement since this arrangement is formulated only as gesture of goodwill by the Plaintiff.
[43] Thus, whatever amount offered or calculation method used is entirely up to the Plaintiff since it was made on the goodwill basis and without any liability admitted, and not related to any clause or term under the Policy. Furthermore, it is up to the Plaintiff to offer or not to offer any settlement figure to the Defendant since the Policy already lapsed.
[44] However, once the Plaintiff had offered a settlement figure under what they called as an exceptional arrangement, it does constitute an offer to the Defendant. And whenever Defendant accepted the offer and in consideration surrender her Policy as requested by the Plaintiff, it does constitute a new agreement between the parties. The new arrangement binds the parties.
[45] Plaintiff's assertion that the settlement arrangement does not constitute a new agreement between parties is not acceptable by this Court. The Policy has lapsed and has not been revived since July 2022. Thus, that is the whole reason why Plaintiff came out with the idea of "exceptional arrangement and goodwill without any liability admitted". The Plaintiff is not under any obligation to offer as such since the Policy already lapsed.
[46] To sum up, I find that the Plaintiff has failed to prove to this Court that there was a mistake regarding the amount they promised to pay and the amount paid to the Defendant. Based on the factual matrix of the case, the Plaintiff, being an institution that handled claims, subscription and all other matters related to their daily business with all the facilities, specialised team and department, manpower and expertise, is expected to be fully conscious and prudence before advancing the settlement amount under the exceptional arrangement to the Defendant.
[47] The Plaintiff is expected to be aware and mindful that the settlement amount under the exceptional arrangement proposed by them has been decided and approved after full consideration, checking and endorsement by layers of level/administration within the Plaintiff's company. The Plaintiff later executed the exceptional arrangement willingly by paying the promised amount to the Defendant. Hence, the Plaintiff cannot now claim otherwise.
[48] I am guided by the decision in "P TREE HOLDING SDN BHD v. JPS HOLDINGS SDN BHD & ANOR [2022] CLJU 3246" whereby it was held:
"47) There is simply no evidence to suggest any mistake here. Hence, the Plaintiff is bound by the terms of the Novation Agreement. On this, DI's counsel has rightfully cited the Supreme Court case of New Zealand Insurance Co Ltd v. Ong Choon Lin (t/a Syarikat Federal Motor Trading) [1991] 3 CLJ Rep 363; [1992] 1 MLJ 185 where LC Vohrah J (at p 193 B-E) quoted the following ratio of AN Grover J in Pearl Insurance Co v. Atma Ram [1960] AIR Punjab 236 (at p 240):
"(1) The primary duty of a court of law is to enforce a promise which the parties have made and to uphold the sanctity of contracts into which the parties have an unfettered right to enter provided that they are not opposed to public policy or are not hit by any provision of the law of the land...""

THE DEFENDANTS'S COUNTER CLAIM AGAINST THE PLAINTIFF
[49] It is pertinent to note that the Defendant's counter claim is founded on her allegation that she has been harassing by the Plaintiff's representative. The harassment that she claimed is that the Plaintiff's representative keeps calling and contacting her on numerous times and occasion to seek her cooperation and action to refund the said mistaken excess amount paid to her by the Plaintiff. This harassment had deteriorated Defendant's health and impacted her recovery as she claimed.
[50] The law on counter claim is already well established. Reference to the case of "PERMODALAN PLANTATIONS SDN BHD v. RACHUTA SDN BHD [1985] CLJ Rep 242" whereby it was held that a counterclaim is a separate and independent action by the defendant. Salleh Abas LP concluded at page 161:
"...Thus, to all intents and purposes a counterclaim is a separate and independent action by the defendant, which the law allows to be joined to the plaintiff's action in order to avoid multiplicity or circuity of suits. Like set-off, a counterclaim is also the creation of Statutes."
[51] Moving from the said cardinal principle, it is the duty of the Defendant to prove its counterclaim against Plaintiff, as required by sections 101 and 102 of the Evidence Act. Having perused the Notes of Evidence and the documents filed in this Court, this Court is unable to find any supporting evidence and/or document especially any medical or mental health report to substantiate Defendant's allegation that her health is getting deteriorated because of the Plaintiff's action in harassing her as she alleged.
[52] This Court believes that the Plaintiff's representative action in contacting the Defendants on numerous occasions asking her to refund the excess paid amount does not tantamount to an act of harassment or breach of any Defendant's right to live in peace and harmony. The Plaintiff's action is understandably reasonable. The Plaintiff is only exercising their right to ask for recovery of the excess amount and it was done professionally by the Plaintiff's representative.
[53] In fact, Defendant also admitted that most of the Plaintiff's calls were unanswered by the Defendant. Therefore, without any documentary evidence adduced to establish Defendant's counter claims against the Plaintiff, this Court is left with no option except to declare that the Defendant's allegation and claims are just a mere bare assertion without any evidence adduced.

CONCLUSION
[54] In light of the analysis and reasons as discussed in the foregoing, on the balance of probabilities, this Court find that:
i) the Plaintiff has failed to prove to this Court that there was a mistake of payment by the Plaintiff. Consequently, the Plaintiff has failed to establish its case for the relief under Section 73 of the Contracts Act 1950 and/or under the common law of "money had and received" and for all other reliefs sought. There is no vitiating factor here. The Plaintiff's claim is hereby dismissed with costs of RM 5000.00.
ii) the Defendant has not succeeded in proving her counter claim against the Plaintiff. The counter claim is therefore dismissed, with costs of RM 5000.00.
[55] I end by expressing the Court's admiration and appreciation to all Learned Counsel for both parties for all of their fine efforts in the conduct of this matter, which were of great assistance to the Court.

Dated: 27 NOVEMBER 2024

(MUHAMMAD NAJIB ISMAIL)
Magistrate,
Magistrate Court (Civil 9), Kuala Lumpur

Counsel:
For the plaintiffs - Kelvin Ho Kok Weng; M/s Lewis Lim & Min Lee
For the defendant - Goh Rhen-Jeat; M/s Alan Kang & Co