ALM TRADING SDN BHD v CS NAM SDN BHD

Case Significance

Illustrates that an acknowledgment of a debt and part payment cause the limitation period to run afresh under section 26(2) of the Limitation Act 1953, and that documentary corroboration of deliveries and settlement proposals will defeat a buyer's bare denial of a trade debt.

This High Court decision at Kuala Lumpur concerns an appeal from the Sessions Court in a claim for the price of goods sold and delivered. The respondent supplier, CS Nam Sdn Bhd, had a longstanding relationship supplying engine oil and lubricants to the appellant, ALM Trading Sdn Bhd, and sued for an outstanding trade account. After a full trial the Sessions Court entered judgment for the supplier for RM375,126.97 with interest and costs, and dismissed the buyer's counterclaim. The buyer appealed, and the High Court dismissed the appeal.

The buyer had admitted only that it made 11 part payments of RM600 each in 2020, denying receipt of goods, invoices, delivery notes, statements or demands, denying any meetings with the supplier's representatives, denying signing letters acknowledging the debt, and pleading that 13 invoices dated between December 2014 and March 2015 were time-barred. The court found that the supplier's witnesses — the lorry driver who identified the acknowledged delivery orders, the sales manager, two directors and the former general manager — were corroborated by contemporaneous documentary evidence admitted by agreement, including statements of account, ledgers, invoices, delivery notes, correspondence and payment records, and by two 2019 letters signed by the buyer's representatives proposing settlement of the outstanding account. On limitation, applying section 26(2) of the Limitation Act 1953, the acknowledgment of the debt in 2019 and the part payments in 2020 meant time ran afresh, so the suit filed in January 2023 was well within the limitation period.

The court also rejected the buyer's counterclaim for RM300,000, finding no term in the parties' 2013 letter of offer obliging the supplier to provide hoisting equipment for meeting sales targets, and only a bare, unsupported assertion of the sales figure relied on. Finding no appealable error by the Sessions Court judge, the court dismissed the appeal with costs of RM10,000.00. The judgment illustrates the effect of acknowledgment and part payment on limitation in a trade-debt claim.