TRESENERGY SDN BHD v 1. ) MOHD FAUZI BIN YA'AKOB 2. ) MTC ENGINEERING SDN BHD

Case Significance

Confirms that a stay of execution of a purely monetary judgment pending appeal is not granted as of right but only on proof of special circumstances, which the applicant bears the burden of establishing.

This High Court decision concerns an application for a stay of execution pending appeal of a substantial damages judgment in a dispute over an offshore fabrication project. The underlying claim arose from a main contract for the fabrication of a vessel for the oil-and-gas industry, which the plaintiff had performed through a consortium arrangement with the second defendant, with the first defendant appointed as project manager. After the main contract was terminated, the defendants took over its performance, and the plaintiff sued for breach of fiduciary duty, inducing breach of contract, breach of contract and the tort of interference. Although the High Court had originally dismissed the plaintiff's claims and allowed the second defendant's counterclaim, the Court of Appeal reversed that decision, declaring that the first defendant had failed in his fiduciary duties as project manager amounting to an inducement of breach of contract, that the second defendant had failed in its duties as a consortium partner contributing to the termination of the contract, and that the second defendant had wrongfully interfered with the plaintiff's interest, and it ordered damages to be assessed. On the assessment, the trial judge awarded the plaintiff loss of business profits and income of USD3,332,050.00 with interest and costs, against which both sides appealed. In the present application the defendants sought a stay of execution of that money judgment pending their appeal. The court held that the burden lay on the defendants to demonstrate special circumstances justifying a stay, and that, the judgment being purely monetary, they had failed to show any special circumstances of the kind required. It accordingly dismissed the stay application with costs. The judgment is a useful illustration of the principle that a stay of execution of a money judgment pending appeal will not be granted as of course, but only where special circumstances are established.