PUTRAJAYA: The Court of Appeal has reserved judgment on an appeal by a Hong Kong company and its director against a High Court ruling that they defamed glove manufacturer Smart Glove International Sdn Bhd and its Singapore associate.
Justice Wong Kian Kheong, who chaired a three-member bench with Justices Firuz Jaffril and Ahmad Shahrir Salleh, said the panel would deliver a written judgment as the appeal raised a novel legal point.
High Court judge Mahazan Mat Taib ruled last year that Cactory International Ltd and its director, Quan Shichuan, had defamed the companies through a letter to the Inland Revenue Board (LHDN) and an email circulated in December 2020.
The letter accused the companies of tax evasion, deceiving the Malaysian government, and using a sham corporate structure.
Mahazan found that Quan had made the allegations based on personal belief arising from a commercial dispute, without verifying them with LHDN or other authorities.
The judge rejected the defendants' claims of justification, absolute privilege and qualified privilege, finding that the publications were malicious and intended to pressure or discredit the firms.
The court also found that the defendants had unlawfully interfered with the plaintiffs’ business.
It awarded general, aggravated and exemplary damages, granted an injunction against further publication, and ordered interest at 5% annually.
The amount of damages was left for separate assessment.
Appearing for the appellants, lawyer S Raam Kumar argued today that the letter was a legitimate complaint to a statutory authority after they suspected the Malaysian company had directed payment to its Singapore associate to avoid tax.
The appellants said they had paid 70% of the purchase price for 12 containers of gloves but did not receive the goods.
They contended that complaints to statutory authorities were protected by absolute or qualified privilege and denied acting maliciously.
However, lawyer Khon Chee Peng, representing the respondents, urged the court to dismiss the appeal, arguing that the complaint was motivated by a desire to pressure the companies into resolving the commercial dispute.
Navinderan Subramaniam and Rishyan Raaj Gopal also appeared for the appellants, while Chan Jiunn Wah represented the respondents.