Litigation and enforcement in Malaysia:

overview
by Daphne Koo, Rahmat Lim & Partners
A Q&A guide to dispute resolution law in Malaysia.
The country-specific Q&A gives a structured overview of the key practical issues
concerning dispute resolution in this jurisdiction, including court procedures; fees
and funding; interim remedies (including attachment orders); disclosure; expert
evidence; appeals; class actions; enforcement; cross-border issues; the use of
ADR; and any reform proposals.

Main dispute resolution methods

1. What are the main dispute resolution methods used in your
jurisdiction to resolve large commercial disputes?
Commercial disputes in Malaysia may be resolved by way of court
proceedings, arbitration, or mediation. The most common method for
dispute resolution in Malaysia is court proceedings. Arbitration proceedings
and mediation proceedings may be initiated if all parties to the dispute
agree to do so.
Large commercial disputes are usually initiated in the High Court of Malaya
which has a monetary jurisdiction of MYR1 million and above for civil
cases.
The Malaysian court system is broadly adversarial. The judge plays a
limited role in legal proceedings and mainly act as a referee between two
opposing parties. However, since the enactment of the Rules of Court 2012
which confer the court a variety of procedural powers, such as striking out
cases or imposing penalty costs in situations of non-compliance with the
court's directions, the courts are increasingly taking on the role of a case
manager. However, a judge cannot compel parties to pursue alternative
dispute resolution, unless the parties agree or have agreed to the same.
The standard of proof for a claimant to successfully prove his case is on a
balance of probabilities.
Online dispute resolution is generally not available in the court system.

Court litigation
Limitation periods

2. What limitation periods apply to bringing a claim and what triggers a

limitation period?
The laws on limitation are generally treated as a procedural law issue.
Limitation periods are governed by the Limitation Act 1953 (LA) which sets
limitation periods for:
  Actions in contract or tort: six years from the date of the contractual
breach or tortious act.
 Actions to recover land: 12 years from the date the right of action
accrues.
 Actions to enforce judgment: 12 years from the date the right to
enforce judgment accrues.
 Actions in respect of fraud or fraudulent breach of trust, or to recover
trust property or the proceeds thereof from the trustee: no limitation
period.
The Limitation (Amendment) Act 2018, which came into force on 1
September 2019, extended the limitation periods for:
 Actions in negligence not involving personal injury where the damage
was not discoverable (that is, latent) before the expiry of the original
statutory limitation period of six years: extended by three years from
the date of knowledge.
 Any action where a person has a disability at the time the cause of
action accrued: three years from the date the person ceased to have
a disability or died (although the action cannot be brought later than
15 years from the date the cause of action accrued).
COVID-19. The Temporary Measures for Reducing the Impact of
Coronavirus Disease 2019 (COVID-19) Act 2020 (COVID-19 Act) was
passed by the Malaysian Parliament and came into effect on 23 October
2020. It will remain in operation for two years, except for certain aspects of
the Act for which the dates of commencement and period of effect have
been specifically provided (see below).
Generally, where the limitation period for an action expired between 18
March 2020 and 31 August 2020, it was extended until 31 December 2020
(Parts III to VI, COVID-19 Act).
Additionally, if a party to a contract is unable to perform any contractual
obligation due to the measures taken to control or prevent the spread of
COVID-19, the non-defaulting party will not be entitled to exercise their
rights under the contract (Part II ,COVID-19 Act). This however only applies
to the categories of contract listed in Schedule to section 7 of the COVID-
19 Act.
The inability to perform the contractual obligation must be related directly to
the measures taken to stop or prevent the spread of COVID-19. However
any contract terminated, performance bond forfeited, damages received,
legal action, arbitration or mediation commenced from 18 March 2020 until
the date of publication of the COVID-19 Act is deemed valid (section 10,
COVID-19 Act). This means that up until that date, parties would still be
allowed to exercise their rights under the contract even if the performance
of such contract was affected by the measures taken since 18 March 2020
to combat the spread of COVID-19.
Part II of the COVID-19 Act came into effect on 18 March 2020 and has
since been extended to remain in operation until 31 March 2021.

Court structure

3. In which court are large commercial disputes usually brought? Are
certain types of disputes allocated to particular divisions of this court?
The appropriate court for a claim depends mainly on the value of the claim
in dispute and the subject matter of the claim. Other factors are taken into
account, such as the nature of dispute (for example, whether it is land
related, a motor vehicle accident claims or tenancy related).
Parties can pursue commercial disputes in the Magistrates Court, the
Sessions Court, or the High Court:
 Magistrates Court. This court hears claims with a value of up to
MYR100,000. Other than that, it is subject to the same limitations in
jurisdiction on specific cases as the Sessions Court (see below).
 Sessions Court. This court hears claims with a value of up to MYR1
million, except for motor vehicle accident claims, landlord and tenant
disputes and distress actions (unpaid rent), over which the court has
unlimited monetary jurisdiction. The Sessions Court cannot hear
cases with a certain subject matter, such as disputes over the title of
immovable property, admiralty claims, bankruptcy claims and
enforcement of trust claims.
 High Court. This court has jurisdiction to hear civil cases with a claim
value of MYR1 million and above, regardless of the subject matter of
the claim.
Generally, employment disputes are heard by the Labour Court or the
Industrial Relations Court. Intellectual property, competition and maritime
claims are heard by the specialised courts for those areas of law which are
heard by the relevant sub-division of the High Court.

Rights of audience

4. Which types of lawyers have rights of audience to conduct cases in

courts where large commercial disputes are usually brought? What
requirements must they meet? Can foreign lawyers conduct cases in
these courts?

Rights of audience/requirements
An Advocate and Solicitor of the High Court who is a qualified person under
section 11 of the Legal Profession Act 1976 (LPA) and who holds a valid
practising certificate under section 29 of the LPA has a right of audience to
conduct cases in Malaysian courts.
It is not mandatory for a private individual to engage a lawyer, as the
individual can represent themselves in court proceedings.
Self-representation is not permitted, however, for companies, which must
engage an advocate and solicitor of the High Court to represent and act for
them according to Order 5, rule 6 of the ROC and section 37(d) of the LPA.

Foreign lawyers
Section 11 of the LPA provides that a qualified person can be admitted as
an advocate and solicitor if he or she is either a citizen or a permanent
resident of Malaysia. Due to the citizenship requirement under this
provision, it is difficult for foreign lawyers to obtain a right of audience. It is,
however, possible for a foreign lawyer to obtain ad hoc admission as an
advocate and solicitor of the High Court for a particular case if both of the
following conditions are satisfied:
 In the opinion of the court, the foreign lawyer has special
qualifications or experience of a nature not available among
advocates and solicitors in Malaysia.
 The foreign lawyer has been instructed by an advocate or solicitor in
Malaysia.
(Section 18, LPA.)

Fees and funding

5. What legal fee structures can be used? Are fees fixed by law?
For contentious matters, there are no fixed scale of fees in Malaysia
prescribed in law. Fees are generally charged on two bases:
 An agreed hourly rate.
 A fixed fee per particular assignments within an overall case as can
be agreed between an advocate and his or her client(s).
The level of fees are guided by several factors, for example:
 The benefit of the service to the client.
 Novelty and difficulty of the question involved.
 Special position and seniority of lawyer involved.
(Rule 11, Legal Profession (Practice and Etiquette) Rules 1978.)
Conditional and contingency fees are generally not permitted pursuant to
section 112 of the LPA.
6. How is litigation usually funded? Can third parties fund it? Is
insurance available for litigation costs?

Funding

Clients are required to pay their own legal costs. Third party funding is not
allowed in Malaysia on public policy grounds.
Insurance

Liability insurance offers an insured party coverage for claims brought

against the, including legal costs of defending such claims, subject to the
terms of the insurance. Examples of liability insurance include:
 Public liability insurance.
 Product liability insurance.
 Professional indemnity insurance.
 Directors' and officers' liability insurance.
However, it is not common for insurance to be available solely for litigation
costs.

Court proceedings
Confidentiality

7. Are court proceedings confidential or public? If public, are the

proceedings or any information kept confidential in certain
circumstances?
Court proceedings are generally public and anyone can watch ongoing
proceedings or access judgments on the court's official website.
Documents filed in the course of a dispute, however, are only accessible to
non-parties through a court file search, which can only be conducted by a
lawyer. A court file search can only be carried out if the lawyer has the
lawsuit number of the dispute. The courts can decide to hold proceedings
in private if they are satisfied that it is expedient to do so in the interest of
justice, public security or propriety.

Pre-action conduct

8. Does the court impose any rules on the parties in relation to pre-action
conduct? If yes, are there penalties for failing to comply?
There are no pre-action conduct rules in Malaysia.

Main stages

9. What are the main stages of typical court proceedings?

Starting proceedings

A claim is usually initiated by filing a writ of summons in court with either a:

 Statement of claim.
 Concise statement of the nature of the claim made, or the relief or
remedy sought in the action.
The filing is usually done online and the writ is usually sealed by the court
within one to two days.

Notice to the defendant and defence

The stages are as follows:

 Once the sealed writ is issued, the claimant must serve the writ of
summons with the statement of claim. The claimant can satisfy notice
requirements by serving just the writ of summons endorsed with the
concise statement of the cause of action being relied upon and the
reliefs that are being sought. This can be done through personal
service or acknowledged receipt (AR) from the registered post
addressed to the defendant's last known address.
 With the latest amendments to the ROC, service of the writ can also
be done by electronically (Order 10 rule 1, ROC).
 The first attempt at service must be within one month from the date of
issue of the writ. There is no deadline within which service on the
defendant must be achieved.
 Once the defendant receives the service of the writ, the defendant
has 14 days to enter appearance in respect of a claim, by filing a
memorandum of appearance.
 If the defendant disputes the court's jurisdiction to hear the claim (for
example, by claiming that Malaysia is not the proper forum for the
dispute or that there were irregularities in the service of the writ), the
defendant must file a notice of application supported by an affidavit
within the time limit for serving a defence.
 Failure to enter appearance can result in a judgment in default of
appearance being entered against the defendant.
 After filing the memorandum of appearance, the defendant must
serve it on the claimant within 14 days.
 If the claimant has not filed a statement of claim at this point, they
must do so within 14 days from the date the defendant entered
appearance.
 If the defendant intends to defend the action, they must serve a
defence on the claimant within 14 days from the deadline for entering
appearance or when the statement of claim is served on them,
whichever is later.
 Again, failure to serve a defence entitles the claimant to file for a
judgment in default of defence against the defendant.

Subsequent stages

The claimant can serve a reply to the defence if they intend to deny or
respond to the allegations made in the defence. Failure to specifically deny
an allegation of fact will be deemed an admission (Order 18 rule 13(1),
ROC). Pleadings are deemed to be closed at the expiry of 14 days from the
date of filing and service of the claimant's reply.
Pre-trial case management will then begin and the court can issue
directions and orders to secure the just, expeditious and economical
disposal of the action or proceeding and to forest a date for a trial (Order 34,
ROC).
All documents must be filed via the electronic filing system of the Malaysian
courts for all court proceedings.

Interim remedies
10. What steps can a party take for a case to be dismissed before a full
trial? On what grounds can such applications be brought? What is the
applicable procedure?

Summary judgment

A claimant can apply for a summary judgment if the matter is:

 Suitable for determination without full trial of the action. In this regard,
the court will consider factors such as whether:
 there is no real prospect of success for bringing or defending
the claim;
 there has been a clear admission by the respondent to the
claimant's claim.
 The determination will finally determine the entire cause or matter.
(Order 14A, ROC.)
An application for a summary judgment is made by filing a Notice of
Application, supported by an affidavit signed by the claimant, to which the
relevant documentary evidence must be annexed as exhibits. The
respondent is entitled to file their own affidavit in response to the
application. The application will then be set for hearing and a decision will
then be made by the court, after hearing legal submissions from the
parties.

Strike-out

An applicant can apply to strike out the whole or part of the claimant's writ
or statement of claim if the claim or the defendant's defence if it:
 Does not establish a reasonable cause of action.
 Is scandalous, frivolous or vexatious.
 May prejudice or delay the fair trial of the action.
 Is an abuse of the court's process.
(Order 18 rule 19, ROC.)
An application to strike-out a writ or statement of claim is commenced by
filing a notice of application supported by an affidavit. The respondent is
then entitled to file an affidavit in response to the application. The
application is then heard before a judge in chambers.

Default judgment

If a defendant has not responded to the claim made against them within the
specified time limit, an application can be made to the court to enter a
default judgment against the defendant. The procedure for doing so
depends on whether the claim is for a liquidated demand, unliquidated
damages, a claim in detinue, a claim for possession of immoveable
property or a mixture of such claims.
(Order 13, ROC.)
11. Can a defendant apply for an order for the claimant to provide
security for its costs? If yes, on what grounds?
A defendant can apply for security of costs on the following grounds:
 The claimant is ordinarily a resident out of the jurisdiction.
 The claimant is a nominal claimant suing for the benefit of another
person and there is reason to believe that that person will be unable
to pay the defendant's legal costs if ordered to do so.
 The claimant's address is not stated in the writ or is incorrectly stated.
 The claimant changed their address during the proceedings to evade
the consequences of proceedings.
(Order 23 rule 1, ROC.)
On receipt of an application for security for costs, the judge will consider
the following factors in deciding whether to grant an order for security of
costs:
 Whether the claimant stands a reasonable chance of success;
 Whether the defendant's application is oppressive towards the
claimant;
 Any loss of funds of the claimant due to the defendant's conduct; and
 Whether it is a bona fide application by the defendant.
(Sir Lindsay Parkinson & Co v Triplan Ltd [1973] 2 All ER 273).
12. What are the rules concerning interim injunctions granted before a
full trial?

Availability and grounds

There are two main types of interim injunctions which can be granted by
the courts:
 Prohibitory injunctions.
 Mandatory injunctions.
In determining whether to grant an interim injunction, the court will consider
the following criteria:
 Whether there is a serious question to be tried.
 Whether damages are an adequate remedy. ; and
 The balance of convenience and whether it weighs in favour of the
applicant.
The applicable standard of proof for the injunction to be granted is on a
balance of probabilities.
In most cases, the applicant is required to provide an undertaking as to
damages, that is, the applicant will pay any damages decided by the court
to be payable if the court subsequently finds that the injunction ought not to
have been granted. However, enforcing such an undertaking is at the
discretion of the courts. In deciding whether to enforce the undertaking, the
courts can consider factors such as the respondent's non-compliance with
earlier orders and whether the application for the injunction was motivated
by deceitful and malicious intent (GS Gill Sdn. Bhd v Descente Ltd [2010] 4
MLJ 609).

Prior notice/same-day
In urgent cases (such as where there is an impending deadline), an
injunction can be obtained ex parte, that is without prior notice to the
defendant (Order 29, ROC).

Mandatory injunctions

Mandatory injunctions are used to compel a party to perform a certain act.

However, the courts do not grant them as readily as prohibitory injunctions.
The applicant must establish all of the following:
 If the injunction is not obtained, damages would be insufficient to
remedy the damage caused.
 The balance of hardship lies with the applicant.
 There will be grave damage to the applicant if the injunction is not
granted.
(Gibb v Malaysia Building Society [1982] 1 MLJ 271.)

Right to vary or discharge order and appeals

A respondent can apply to set aside an injunction order within 21 days after
the ex parte injunction is granted (Order 29, ROC). Although an ex parte
injunction order will automatically lapse within 21 days, an application to set
aside the injunction will be required and relevant in terms of determining
the costs and damages incurred as a result of the ex parte injunction order.
A respondent can also apply to vary or appeal an injunction order. The
application to vary can be made throughout the duration of the injunction
order and the application to appeal against an injunction order must be
made within one month from the date the injunction order is granted.
13. What are the rules relating to interim attachment orders to preserve
assets pending judgment or a final order (or equivalent)?

Availability and grounds

A Mareva injunction (also known as a freezing order) is a court order

preventing a defendant from dealing with, moving or disposing of their
assets. Essentially, it means that the defendant's assets are "frozen" such
that any attempt to transfer or to move their assets would constitute a
breach of the court's order and a contempt of court. A freezing order is
binding on third parties if they are served with the order.
A freezing order obliges the defendant to make disclosure of all their
assets, whether within or outside of Malaysia. It can also, in certain
circumstances, oblige third parties to disclose information relating to the
defendant's assets that are held by them.
Because of the far-reaching consequences of a freezing injunction, the
claimant must satisfy the following requirements before the court would
grant such order:
 The claimant must have an arguable case.
 The defendant must have assets within the jurisdiction.
 There is evidence of a real risk of dissipation or removal of the
defendant's assets prior to issue of a judgment in the substantive
proceedings.
 The balance of convenience lies in favour of the claimant and the
granting of a freezing injunction.
It is to be noted that the Malaysian courts have accepted that the risk of
dissipation of assets always exists if it can be shown that the defendant
either acted without good faith, maintains foreign accounts or there has
been evidence of movement of funds into foreign accounts.

Prior notice/same-day
An application for a freezing injunction can be made ex parte. However, it
will only be valid for 21 days from the date the order was granted and a
hearing of the application must be scheduled within 14 days from the
granting of the ex parte order. Where the application is made ex parte, the
claimant is obliged to make full and frank disclosure of all relevant material
facts, including those that are not in the claimant's favour. A failure to do so
can result in the order being set aside.

Main proceedings
Malaysian courts can grant freezing injunctions in respect of substantive
proceedings taking place in another jurisdiction.

Preferential right or lien

An attachment does not create any preferential right or lien in favour of the
claimant over the seized assets.

Damages as a result
A plaintiff seeking a freezing injunction must also give an undertaking to
compensate the defendant for any damages that they may suffer as a
result of the order, if it later transpires that the order ought not to have been
granted.

Security

Generally, no further security is required to be given save for the

undertaking for damages by the applicant. However, the defendant can
apply for security in addition to the undertaking granted.
14. Are any other interim remedies commonly available and obtained?

Proprietary Injunction
A claimant can also seek to preserve a specific asset of the defendant's
over which the claimant is claiming a proprietary interest (Steven Gee,
"Commercial Injunctions" (6th edition, Sweet & Maxwell) at 7-012). To apply for
and obtain a proprietary injunction, a claimant must establish all of the
following:
 There is a bona fide serious issue to be tried.
 The balance of convenience lies in favour of granting the injunction.
 That damages would not be an adequate remedy.
(American Cynamid v Ethicon Limited [1975] AC 396 as adopted by the Malaysian
courts in the case of Keet Gerald Francis Noel John v Mohd Noor bin Abdullah
[1995] 1 MLJ 195 at pp.206-207.)
It is not uncommon for a proprietary injunction to be granted to preserve the
assets of a victim of a fraudulent scam which has fallen into the hands of a
third party and such injunction would be granted even though the assets
sought to be preserved are monetary in nature.

Anton Piller Order

Where a claimant is concerned that a defendant may hide or destroy

evidence that is relevant to the claimant's claim, the claimant can seek an
injunction requiring the defendant to permit the claimant to enter into the
defendant's premises to enable an inspection, seizure and removal of
documents relating to the claimant's claim. This type of injunction is more
commonly known as an Anton Piller order.
In order to obtain an Anton Piller order, the claimant must establish all of
the following:
 There is an extremely strong prima facie case;
 The damage, potential or actual, must be very serious for the
claimant.
 There must be clear evidence that the defendant has in its
possession incriminating documents and that there is a real
possibility that the defendant may destroy such material before any
inter partes applications can be made.
As with a freezing injunction, the application must be accompanied by a full
and frank disclosure and an undertaking as to damages is to be given. A
defendant can make an application for an ex parte Anton Piller order to be
set aside and can also make a claim for any damages arising from the
order.

Bankers Trust Order

A claimant can apply for a disclosure order against a third party bank for
information pertaining to a defendant's bank account known as a "Bankers
Trust" order (named after the English case that established the jurisdiction
and power of a court to make such a disclosure order (Bankers Trust Co v
Shapira and Others [1980] 1 WLR 1274 at p. 1275)). Such a disclosure can
also be applied for pursuant to sections 134 and Schedule 11 of the
Financial Services Act 2013 and section 7 of the Bankers' Book (Evidence)
Act 1949. A Bankers Trust order is most commonly used to assist the
claimant in tracing the whereabouts of monies claimed against the
defendant.

Norwich Pharmacal Order

Prior to commencing proceedings, a claimant can apply for a "Norwich
Pharmacal" order to obtain documents from a third party with the aim of
identifying the wrongdoer. This is usually done in circumstances where the
claimant is uncertain of the parties that may be involved in the wrongdoing
committed against them.
Strict conditions must be satisfied to ensure that such disclosure
application is not made as a "fishing expedition".
To obtain a Norwich Pharmacal order, the claimant must provide an
affidavit containing the following information:
 The documents sought for disclosure.
  Sufficient and material facts to show that the defendant is in
possession, power and/or custody of the documents concerned or is
likely to have the documents.
 Sufficient facts to show the likelihood of the defendant being a party
named in the subsequent legal action.
 The relevancy of the documents sought for disclosure.
(Order 24 rule 7A (3), ROC.)
Where such order is made by the court, the person against whom the order
was made will be entitled to his costs of the application and of complying
with any order made on an indemnity basis unless the court orders
otherwise (Order 24 rule 7A (9), ROC).

Final remedies
15. What remedies are available at the full trial stage? Are damages only
compensatory or can they also be punitive?
There are various remedies that are available at the full trial stage and
these include monetary damages, declarations, specific performance and
injunctions. For civil cases, the losses must be proven on a balance of
probabilities.

Evidence
Document disclosure

16. What documents must the parties disclose to the other parties and/or
the court? Are there any detailed rules governing this procedure?
All documents which are relevant to the case and which are intended to be
used during the proceedings must be disclosed during the pre-trial case
management stage to the court. The court can order the production of the
following documents pursuant to a disclosure application:
 Documents on which the party relies or will rely.
 Documents which could adversely affect or support either party's
case.
(Order 24, ROC.)
If such order is made, the party required to make disclosure is under a duty
to continue to make disclosure of such documents until the trial has
concluded. The extent of the parties' obligation to preserve documents
once litigation is in contemplation or in progress depends on the relevancy
of the documents. If such documents are reasonably expected to be
relevant and required for trial purposes, then a party must preserve the
same. Parties are expected to make a reasonable search for documents
which are or have been within their control.
The ordinary time limit for disclosure depends on the pre-trial case
management directions given by the court.
All disclosures must be provided in physical hard copy unless otherwise
directed by the court.
In the event of non-compliance, the judge is entitled to take any action they
consider just, which includes dismissing the action or striking out the
defence.

Privileged documents

17. Are any documents privileged? If privilege is not recognised, are

there any other rules allowing a party not to disclose a document?

Privileged documents

Privilege applies to communication between a solicitor and the client for the
purposes of:
 Seeking legal advice (legal advice privilege).
 Existing or contemplated litigation (litigation privilege).
Legal advice privilege does not extend to communications between a party
to litigation and their in-house counsel.
Legal advice privilege is not absolute. There are exceptions to the rule
including, among other things:
 Any communication made between a client and their lawyer in
furtherance of any illegal purpose.
 Any fact observed by a lawyer in the course of his engagement by a
client indicating that a crime or fraud has been commenced since the
commencement of their engagement by the client.
Without prejudice communications are considered privileged (section 23,
Evidence Act 1950). Any admissions made in such communications are
inadmissible in legal proceedings, if they are made under an express
condition that such admissions are made without prejudice to court
proceedings. This includes communications made in a genuine attempt to
settle the dispute.

Other non-disclosure situations

Other documents that cannot be made subject to disclosure include those

covered by public policy privilege and affairs of state privilege. Public policy
privilege applies to documents which if disclosed would be injurious to
public interest (Order 24, ROC). Affairs of state privilege applies to
documents such as military secrets, international affairs and departmental
policy documents.
Confidential or commercially sensitive documents can be protected from
disclosure by an application to the court by a party. The court, after
reviewing such application, can make orders such as:
 Redaction of the confidential or commercially sensitive portions of the
documents.
 A direction that such documents be available only for the court's
review and to be sealed thereafter (protective or sealing order"
(Kingtime International Ltd. & Anor v Petrofact E & C Sdn Bhd [2019]
MLJU 713, HC).

Examination of witnesses

18. Do witnesses of fact give oral evidence or do they only submit written
evidence? Is there a right to cross-examine witnesses of fact?

Oral evidence

The weight that is attached to oral evidence will depend on an assessment

of the witness' honesty and truthfulness by the court. It may be considered
to be of less value than documentary evidence, especially if the oral
evidence contradicts the available documentary evidence. Depending on
the nature of proceedings, witnesses of fact will usually provide written
evidence in the form of affidavits or oral evidence during trial.
Witness statements are usually filed at court to facilitate a smoother and
faster witness examination process. Generally, witness statements must be
filed seven days before the first day of trial. Witnesses will also be required
to appear in court to confirm their witness statements and must be
available for cross-examination and re-examination by the parties. The oral
testimony of witnesses for their examination in chief need not necessarily
be limited to what was set out in their witness statements. However, leave
of the court will be required for any additional facts that a witness may
include during their examination in chief.

Right to cross-examine

During trial, witnesses are subject to cross-examination by the opposing

party. The judge is entitled to ask questions to obtain proper proof or
relevant facts. (section 165, Evidence Act 1950).

Third party experts

19. What are the rules in relation to third-party experts?

Appointment procedure
There is no obligation to disclose a draft expert report.
Generally, it is the parties who are responsible for appointing experts to
provide expert evidence and give testimony at trial. The court can however,
limit the number of experts summoned. (Order 40A rule 1, ROC).

Role of experts
There is an overriding duty imposed on the expert to assist the court on
matters within his expertise. The expert's duty to the court overrides any
obligation to the party who has instructed them or is paying them.

Right of reply
Order 40A of the ROC sets out the requirements for expert evidence.
Expert evidence must be given in the form of a written report signed by the
expert and exhibited in an affidavit sworn to or affirmed by the expert
testifying that the report exhibited is theirs and that they accept full
responsibility for the contents of the report. An expert report must include
details of the expert's qualifications, any literature or other material which
the expert has relied on in making the report, a statement setting out the
issues which he has been asked to consider and the basis upon which the
evidence was given.
The court can direct a discussion between experts for the purpose of
requiring them to identify the issues in the proceedings and where possible,
to reach an agreement on the issues. The court can also specify the issues
which the experts must discuss.
Within 14 days of the disclosure of the expert's reports, parties can submit
written questions to the experts about their reports, with the permission of
the court.
During the trial, experts can be cross-examined about their reports and
opinions.

Fees

The party who appoints the expert will bear the expert's fees. The fees,
however, can be passed on to the losing party at the conclusion of the trial
by asking the judge for the costs to be borne by the losing party.

Appeals
20. What are the rules concerning appeals of first instance judgments in
large commercial disputes?

Which courts
An appeal against decisions of the High Court can be made to the Court of
Appeal (section 67(1), Courts of Judicature Act 1964 (CJA)).
Appeals against the decisions of the Court of Appeal can be made to the
Federal Court, subject to obtaining permission to bring an appeal (section 96
and 97, CJA).

Grounds for appeal

Appeals to the Court of Appeal
An appeal can be made when either:
 The claimed amount is MYR250,000 or more.
 The claim pertains to an interpleader judgment given after trial.
(Section 68, CJA.)
To appeal in other instances, permission of the Court of Appeal must first
be obtained. No appeal is allowed for consent judgments or where the
judgment of the High Court is declared final in any written law.
Appeals to the Federal Court. An appeal can be made, if it is either :
 An appeal against any judgment or order of the Court of Appeal in
respect of any civil matter decided by the High Court in the exercise
of its original jurisdiction and there is a question regarding a general
principle decided for the first time or a question of importance and
answering it would be in the public interest.
 Aan appeal regarding any provision of the Constitution and the
validity of any written law relating to such provision.
(section 96, CJA.)

Time limit
An appeal to the Court of Appeal from a decision of the High Court must be
made within one month from the date of the order appealed against (rule
12, Rules of Court of Appeal 1994).
Leave to appeal to the Federal Court from the decision of the Court of
Appeal must be made within one month from the decision of the Court of
Appeal (section 97(1), CJA).

Class actions
21. Are there any mechanisms available for collective redress or class
actions?
Class actions are usually pursued in the form of a representative action
(Order 15, ROC). The requirements for a class action are:
 The claimants or defendants must be members of the same class.
 There must be a common grievance.
 The reliefs must be beneficial to all members of the same class.
(Palmco Holdings v Sakapp [1988] 2 MLJ 624).
A class action adopts an "opt-in" mechanism in which a member of the
same class can apply to be included in the proceedings as a co-plaintiff or
co-defendant. Class actions must be funded by the parties themselves.
The claimants must be of the same class before they can be pooled into a
class action.

Costs
22. Does the unsuccessful party have to pay the successful party's costs
and how does the court usually calculate any costs award? What factors
does the court consider when awarding costs?
Generally, costs are recoverable by the successful party and the losing
party has to bear their own costs (Order 59 rule 3(2), ROC). However, the
court retains the discretion to order the successful party to pay the losing
party instead in certain circumstances, such as when an appeal is heard as
a result of the misconduct or neglect of the winning party (Order 59 rule 5,
ROC).
The legal costs awarded by the court will include the getting-up fee, that is,
the legal fee that is incurred for the preparation of the action. However, in
practice, this sum is usually not the actual legal fee that is expended by a
party. Costs awarded in the case are determined by the court, taking into
account factors such as the complexity of the matter, the quantum of the
claim and whether the matter involved a novel or complex issue of law.
When determining the quantum of costs to be awarded, the courts are also
required to take special matters into account, such as:
 Whether there was an offer of contribution or offer of settlement.
 The conduct of all parties before and during proceedings.
(Order 59 rule 8, ROC).
The court does not have the power to manage, limit or otherwise control
costs during the proceedings. However, the costs that are awarded by the
court to the winning party ultimately may not reflect the actual amount that
is expended by the party.
23. Is interest awarded on costs? If yes, how is it calculated?
Any award on costs will carry interest at the rate determined by the Chief
Justice at that time (Order 59 rule 24, ROC). The current rate is 5% per
annum.

Enforcement of a local judgment

24. What are the procedures to enforce a judgment given by the courts
in your jurisdiction in the local courts?

Writ of execution
A judgment can be enforced by a writ of execution. There are several types
of orders available under a writ of execution:
 Writ of seizure and sale for payment and money.
 Writ of delivery for movable property.
 Writ of seizure and sale for immovable property.
Permission of the court may be necessary to enforce a judgment in certain
circumstances:
 Once six years or more has lapsed from the date of judgment.
 Where any change has taken place in the parties entitled or liable to
execution under the judgment or order.
 Where the judgment or order is against the assets of a deceased
person which is coming to the hands of his executors or
administrators.
(Order 26 rule 2(1), ROC.)

Garnishee proceedings
A judgment creditor can apply by garnishee proceedings to order a
garnishee (third party) to pay the judgment creditor of any debt due or
accruing to the judgment debtor. In other words, the judgment creditor can
compel the debtors of the judgment debtors to settle their debts with the
creditor instead.

Charging order
A charging order imposes a charge over the debtor's beneficial interest in
land (Order 50, ROC).

Appointment of receivers by way of equitable execution

If a judgment debtor is receiving income from various sources such rents,
profits, royalties, and dividends, an appointment of receivers by way of
equitable execution is an appropriate method to enforce a judgment. The
procedure of appointing a receiver is set out in Order 30, rules 1 to 6 of the
ROC.

Cross-border litigation
25. Do local courts respect the choice of governing law in a contract? If
yes, are there any national laws or rules that may modify or restrict the
application of the law chosen by the parties in their contract? What are
the rules for determining what law will apply to non-contractual claims?

Contractual choice of law

The Malaysian courts will respect the choice of law clause in contracts
except where there are public policy reasons not to do so.
Where parties have agreed that the law of a foreign jurisdiction will govern
their contract, the Malaysian courts will respect the choice of law, except in
certain circumstances. For example, where the dispute relates to
immoveable property which is governed by provisions of Malaysian land
law.
In an action for damages for breach of contract governed by a foreign law,
the measure of damages must be decided according to Malaysian law,
even if the parties agreed that the applicable law to the contract is a foreign
law (Scandinavian Bunkering (Singapore) Pte Ltd v MISC Bhd [2015] 3 MLJ
753).
Where the parties have agreed that Malaysian law will govern their
contract, Malaysian courts will respect the choice of law unless it is against
Malaysian public policy. However, Malaysian courts will normally have
regard to the laws of another jurisdiction, as set out above.

No choice of law and non-contractual claims

In the absence of any agreement between the parties and in relation to

non-contractual claims, the court will determine both the procedural law
and substantive law in the manner set out below.
If a case is commenced in the Malaysian courts, the default procedural law
would be Malaysian law. To decide whether or not a case should be tried in
Malaysia, the court will first determine whether it has the jurisdiction to try
the case. The High Court in Malaysia will have jurisdiction to try all civil
proceedings where either:
 The cause of action arose in Malaysia, that is, that the breach or root
of the dispute occurred in Malaysia.
 The defendant or one of multiple defendants resides or has their
place of business in Malaysia.
 The facts on which the proceedings are based exist or are alleged to
have occurred in Malaysia.
 Any land ownership in dispute is situated within the local jurisdiction
of the court (that is the physical territory in Malaysia, over which the
court presides).
(section 23, CJA.)
Once the court is satisfied that it has jurisdiction to try the case, the court
will apply the principle of forum non conveniens (as explained in detail below)
to determine whether or not to try the case.
In terms of substantive law, the courts will take the general position that
Malaysian law will be applicable subject to the principles of conflict of law
such as considered by reference to the place where the contract was
negotiated or entered into, by reference to the place most closely
connected to the dispute or by reference to the place most closely
connected to the contract.
26. Do local courts respect the choice of jurisdiction in a contract? Do
local courts claim jurisdiction over a dispute in some circumstances,
despite the choice of jurisdiction?
Malaysian courts will generally give effect to choice of jurisdiction clauses.
Disregarding a choice of jurisdiction clause in the absence of exceptional
circumstances would imply that the courts are condoning a breach of
agreement (World Triathlon Corp v SRS Sports Centre Sdn. Bhd [2019] 4 MLJ
394).
However, Malaysian courts still retain discretion to decide on the applicable
jurisdiction on a case-by-case basis. The Supreme Court (the precursor to
the Federal Court) stated that in exercising their discretion, the courts will
take into account the principle of forums non conveniens (that is, whether the
Malaysian courts are the most appropriate tribunal to try the case). Factors
considered include:
 Convenience and expense of hearing the case in Malaysia, rather
than another jurisdiction.
 Availability of witnesses.
 The law governing the relevant transaction.
(American Express Bank Ltd v Mohamod Toufic Al- Ozeir & Ors [1995] 1 MLJ
160.)
27. If a party wishes to serve foreign proceedings on a party in your
jurisdiction, what is the procedure to effect service in your jurisdiction?
Is your jurisdiction a party to any international agreements affecting
this process?
Malaysia is not a party to an international convention on this issue. Service
of foreign proceedings in Malaysia is governed by Order 11 of the ROC.
Proceedings must be served personally or by AR to the registered postal
address of the defendant. This is exempted in the following circumstances:
 Where the defendant's solicitors accept the writ on behalf of the
defendant.
 Where the defendant has entered an appearance (that is, that he or
she has filed a memorandum of appearance in court, to acknowledge
the claim that has been initiated against him or her and to indicate
that he or she will be defending the claim).
Personal service is effected by leaving a copy of the document with the
person to be served (Order 62 rule 3, ROC). However, the service of the
document and its contents should be made known to the defendant,
otherwise it might be considered ineffective (Banque Russe v Clark [1894] WN
203).
Service of documents can be effected on a corporation, by either:
 Leaving a copy of it at the registered office of the corporation.
 Sending it by registered post to the principal office.
  Handing a copy of it to the secretary, director or any other officer of
the corporation.
If the defendant's location cannot be traced or multiple service attempts
have failed, the claimant can apply for an order for substituted service
(Order 62 rule 5, ROC).The claimant however, should make at least two
visits to the defendant during reasonable hours and deliver an appointment
letter which states the time of the next visit and give the defendant an
opportunity to make a different appointment (practice note 1/1968). Once the
order has been obtained, the court can direct the claimant to take
necessary steps to bring the news of the proceedings to the defendant's
attention by way of either:
 Advertisement in a local newspaper.
 Posting a copy of the writ on the court premises.
If foreign documents required for service are not in Malay or English, a
certified true translation to Malay or English will be required.
28. What is the procedure to take evidence from a witness in your
jurisdiction for use in proceedings in another jurisdiction? Is your
jurisdiction party to an international convention on this issue?
A foreign party can seek the assistance of Malaysian courts to take
evidence from a local witness for use in foreign proceedings (Order 66,
ROC). An application must be made ex parte by a person duly authorised to
make the application on behalf of the foreign court in question. Such
application must be supported by an affidavit. A letter of request or other
document issued by a foreign court to obtain evidence of a witness for the
purposes of civil proceedings before that court must also be included as an
exhibit.
The examination of a witness can be taken before any fit and proper
person nominated by the person applying for the order, or by the registrar
of a Malaysian court. Subject to a contrary order, the witness will be
examined, cross-examined and re-examined in the same manner as at a
trial. The examiner will send the deposition of the witness to the registrar,
who will then issue a certificate to be sealed by the High Court for use out
of the jurisdiction. The registrar will then send this certificate to the
authorised person for transmission to the foreign court or tribunal.
Malaysia is not a party to an international convention on this issue.

Enforcement of a foreign judgment

29. What are the procedures to enforce a foreign judgment in your
jurisdiction?
A foreign judgment must be registered in the Malaysian courts before it can
be enforceable. The requirements for registration are found in section 4 of
the Reciprocal Enforcement of Judgments Act 1957 (REJA).
One of the requirements for registration of foreign judgments is that the
foreign judgment in question must be from a reciprocating country as
provided for in the list of countries in REJA. A foreign judgment from any
country not registered under REJA must be enforced by commencing fresh
proceedings. This requires proceedings to be brought in a Malaysian court
and for a domestic judgment to be obtained in which the claimant must
provide prima facie evidence of a claim against the respondent.
If the foreign judgment is from a reciprocating country, an application can
then be made to register the foreign judgment. The foreign judgment
creditor must lodge an originating summons supported by an affidavit. In
practice, the initial hearing date is sought on an ex parte basis. The affidavit
in support must exhibit a duly verified, certified or authenticated copy of the
foreign judgment. If the judgment is not in English, a translation certified by
a notary public must also be filed. The affidavit must comply with certain
formalities, as follows:
 State the name, trade or business and usual or last known address of
the judgment creditor and judgment debtor.
 State, to the best of the information or belief of the deponent, that:
 the judgment creditor is entitled to enforce the judgment;
 the judgment has not been satisfied;
 the judgment does not fall within any of the cases in which the
judgment cannot be ordered to be registered under REJA;
 as at the date of the application the judgment can be enforced
by execution in the country of the original court; and
 if registered, the registration would not be liable to be set aside
under REJA.
(Order 67 rule 3, ROC.)
On the hearing date, the court will, if the application appears on its face to
comply with REJA, grant leave to register the same. The order for leave
must state the period within which an application can be made to set aside
the registration, and that execution of the judgment will not be issued until
the expiration of that period. Typically, the court will grant 14 to 21 days for
such an application to be made. The order for leave to register the foreign
judgment must be served on the judgment debtor with a notice of
registration.
The person serving the notice of registration must endorse the notice within
three days after service (which is the date on which the notice was served).
If an application to set aside the registration of the judgment is filed by the
judgment debtor, the court will fix a hearing date for the application. In such
instance, execution of the judgment cannot be levied until after such an
application has been finally determined.
Once a foreign judgment is registered or a domestic judgment is obtained,
the foreign judgment can be enforced in the same way as a domestic
judgment. There are various ways a judgment can be enforced such as by
commencing winding-up or bankruptcy proceeding, garnishee proceedings
or execution of a writ of seizure and sale.
Under common law, a judgment creditor can enforce a foreign judgment in
the Malaysian courts by treating the judgment as a statement of debt that is
due. The judgment creditor must show that the court that issued the foreign
judgment had jurisdiction over the judgment debtor, the judgment was final
and that the judgment sum is a liquid sum if the claim is made in personam.

Alternative dispute resolution

30. What are the main alternative dispute resolution (ADR) methods
used in your jurisdiction to settle large commercial disputes? Is ADR
used more in certain industries? What proportion of large commercial
disputes is settled through ADR?
The most common forms of ADR in Malaysia are mediation, arbitration and
adjudication. While there are no available statistics regarding disputes
settled through ADR, it is fairly common and has become more popular in
recent years.
Mediation is a voluntary process governed by the Mediation Act 2012 (MA)
in which communication and negotiations are facilitated by a third party
who acts as the mediator. Parties are free to appoint their own mediator but
can request the Malaysian Mediation Centre of the Bar Council (MMC) to
appoint a qualified mediator from its panel if they are unable to arrive at an
agreement. Successful mediation will result in the agreements being
recorded into writing in a settlement agreement signed by the parties.
Parties to unsuccessful mediation nevertheless can proceed to pursue
litigation or arbitration. Parties maintain full control of the outcome and
procedure of mediation.
Arbitration is a private process of judicial determination by an independent
third party who acts as an arbitrator that is governed by the Arbitration Act
2005 (AA). Arbitration is similar to court proceedings in that the arbitrator
decides the outcome of the dispute like a judge but the parties have
discretion to decide on the number of arbitrators, the appointment of the
arbitrator and the rules to be applied during the arbitration. An arbitration
judgment is binding on the parties.
Adjudication is a process for the resolution of construction disputes,
introduced by the Construction Industry Payment and Adjudication Act
2012 (CIPAA) and is being increasingly used in construction disputes. An
adjudication will be binding unless it is set aside by the High Court (Section
13, CIPAA) on any of the permitted grounds, which are:
 The subject matter of the decision is settled.
 The dispute has been decided on a final basis by arbitration or court
proceedings, or by a written settlement agreement between the
parties.
(section 15, CIPAA.)
A claimant can initiate adjudication proceedings by serving a written notice
of adjudication containing the nature and description of the dispute and the
remedy sought together with any supporting document on the respondent.
Upon receipt by the respondent, an adjudicator will be appointed in the
manner described in section 21 CIPAA.
An adjudicator can be appointed by agreement of the parties within ten
days of service of the notice of adjudication by the claimant or alternatively,
by the Director of the Asian International Arbitration Centre (AIAC), either,
at the request of either party to the dispute if no agreement can be
achieved between the parties or at the request of the parties in dispute.
Thereafter, and upon the filing of the adjudication claim, adjudication
response and the adjudication reply, the adjudicator will render his or her
adjudication decision in writing within 45 days from the date on which the
last pleadings were received.
31. Does ADR form part of court procedures or does it only apply if the
parties agree? Can courts compel the use of ADR?
ADR is not mandatory in Malaysia and it only applies if the parties agree.
However, if there is an arbitration agreement between the parties and one
party brings the matter to court, the other party can apply to the court under
section 10 of the AA to stay the legal proceedings and refer the matter to
arbitration.
Additionally, under the new amendments to the ROC, a High Court judge
can refer the parties of the proceedings to mediation if the judge identifies
an issue arising in the action or proceeding which can be resolved by way
of mediation (Order 34 rule 1(2A), ROC).
32. How is evidence given in ADR? Can documents produced or
admissions made during (or for the purposes of) the ADR later be
protected from disclosure by privilege? Is ADR confidential?
For arbitration, parties must not disclose, publish or communicate any
information about the arbitration award and the proceedings (section 41A,
AA). However, parties can reveal information relating to the arbitration in
the following circumstances:
 To protect or pursue a legal right or interest of one of the parties to
the arbitration.
 To enforce or challenge the arbitration award.
 Mandatory disclosure to public authorities.
 Disclosure to a professional or any other advisers of one of the
parties.
Mediation proceedings are confidential (section 15, MA), unless the parties
consent to disclosure. Mediation communications are privileged, unless:
 Privilege is expressly waived by the parties, the mediator and the
non-party (that is, a party to whom such privilege applies but who is
not a party to the mediation process).
  The communication relates to a crime or an attempt to commit a
crime or to conceal a crime.
 It is sought to prove or disprove a complaint of misconduct during the
mediation process.
(section 16, MA).
33. How are costs dealt with in ADR?
In arbitration, the arbitrator is vested with the discretion to order costs
against either party (section 44, AA). The general rule is that the costs will
follow the outcome of the arbitration, that is, the unsuccessful party pays
the costs of the successful party and bears their own costs.
In mediation, parties are expected to bear the costs equally (section 17, MA).
34. What are the main bodies that offer ADR services in your
jurisdiction?
The AIAC provides a neutral system to settle disputes in trade, commerce
and investment within the Asia-pacific region. The AIAC is a non-profit,
non-governmental international arbitral institution which has been accorded
independence and certain privileges and immunities by the government of
Malaysia for the purposes of executing its functions as an independent,
international organisation. The AIAC has established its own AIAC
Arbitration Rules, AIAC i-Arbitration Rules, AIAC Fast Track Rules and
AIAC Mediation Rules.
The MMC is a body established through the Malaysian Bar Council to
promote mediation as a means of ADR and provide a proper avenue for
successful ADR. The MMC offers mediation services, provides mediation
training for those interested in becoming mediators, and accredits and
maintains a panel of mediators. Currently, the MMC consists of lawyers
who have completed their mediation training programmes and deals with
civil, commercial and matrimonial matters. The MMC intends to expand its
scope to other matters in the future.

Proposals for reform

35. Are there any proposals for dispute resolution reform? If yes, when
are they likely to come into force?
There are currently no substantial proposals for dispute resolution reforms.

Contributor profile
Daphne Koo

Rahmat Lim & Partners

T +603 2299 3869

F +603 2287 1278
 E [email protected]
W www.rahmatlim.com
Professional and academic qualifications. LL.B. (Hons), University of London,
2004; Legal Practice Certificate, 2005
Areas of practice. Arbitration; litigation; admiralty and maritime law; land
reference proceedings; aviation law; corporate and commercial litigation.
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