Case Updates

Case Update: The doctrine of prospective overruling

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EVIDENCE
Standard of proof – Balance of probabilities – Fraud – Doctrine of prospective overruling – Whether Sinnaiyah & Son Sdn Bhd v Damai Setia Sdn Bhd applied to all pending cases and cases under appeal
 
Ling Peek Hoe & Anor v Ding Siew Ching & Another Appeal [2017] 7 CLJ 641, Federal Court
 
Facts The plaintiff was the registered owner of three properties. The first defendant was an advocate and solicitor while the second defendant was a licensed money lending company. The plaintiff took a bank loan and charged his properties as securities. Subsequently, the plaintiff approached the second defendant for loans. He was required to furnish the original title of the properties and signed some documents. He was also told that the second defendant has the right to hold the property titles until the loans are fully repaid. When the second defendant settled the first plaintiff’s bank loan, the charges on the properties were discharged accordingly. A dispute arose when the plaintiff discovered that the properties had been transferred to others without his consent and knowledge. The sale and purchase agreements (SPAs) effecting the transfer were handled by the first defendant. The plaintiff sued the defendants at the High Court alleging misrepresentation, fraud or conspiracy to defraud, and sought for a declaration that the SPAs and transfer were null and void. The High Court applied the standard of beyond reasonable doubt and decided that the plaintiff had proved their case. However, the decision was reversed upon appeal to the Court of Appeal. Aggrieved, the plaintiff appealed.
 
Issue The main issue was whether the principles in Sinnaiyah & Son Sdn Bhd v Damai Setia Sdn Bhd[1] which have a prospective overruling effect on future cases apply.
 
Held In allowing the appeal and reinstating the High Court’s decision, the Federal Court held that the law declared by the Federal Court and made subject to the doctrine of prospective overruling applies to all pending cases and cases which are still under appeals. It was further ruled that as the High Court judge relied on a higher standard, beyond reasonable doubt, for the plaintiff to prove their case, he would definitely decide in the plaintiff’s favour if a lower standard, on the balance of probabilities, is adopted.
 
[1] [2015] 7 CLJ 584, Federal Court