The Litigation Process in Malaysia

Previously, we had a broad look at the Malaysian legal system. An important component of the Malaysian legal system is the civil litigation process. The litigation process in Malaysia, like many other common law jurisdictions, serves as the formal mechanism for resolving legal disputes through the judicial system. This process is characterised by various stages, each contributing to the fair and just resolution of conflicts. This article seeks to outline the key components and procedures of the Malaysian litigation process, from the steps to consider before filing a claim through to trial, judgment, appeal and the enforcement of a judgment that has been obtained.

Civil disputes in Malaysia are heard by courts of differing jurisdiction depending on the value and nature of the claim. The Magistrates’ Court and the Sessions Court (collectively, the subordinate courts) hear claims up to prescribed monetary limits, while the High Court hears higher-value and more complex matters at first instance. Appeals travel upward to the Court of Appeal and, ultimately, the Federal Court. Understanding where a dispute sits within this structure is the starting point of any litigation strategy.

Factors to consider before filing a claim in court

Before filing a claim in court, the following must be considered:

• Cause of action. Is there a proper legal basis for your claim?
• Limitation period. Are you within time to file your claim?
• How will you back up your claim? Do you have the necessary evidence in the form of documents or witnesses?
• Forum and cost. It is also prudent at this stage to consider which court has jurisdiction over the dispute, whether the prospective defendant has the means to satisfy a judgment, and the likely time and cost of pursuing the matter to its conclusion. A claim that cannot ultimately be enforced may be a poor use of resources, however strong it is on the merits.

Letter of demand

After considering the above matters, it is generally recommended to first issue a letter of demand, even though this is strictly not a prerequisite to filing a claim in court. This is because the letter of demand often acts as a time- and cost-effective tool to resolve disputes. It may prompt a favourable response from the recipient of the demand letter and prevent the dispute from progressing further, especially if the demands are complied with, or if the parties settle the matter without having to go to court.

Filing your claim in court / commencing legal proceedings

If the dispute is not resolved at that stage, then commencing legal proceedings will be necessary. This typically begins with the filing of a writ of summons or originating summons by the claimant/plaintiff. The writ of summons or originating summons will outline the nature of the claim, the reliefs sought, as well as the legal basis for the action.

Proceedings which are commenced by way of writ of summons are usually for cases where a substantial dispute of fact is likely to arise. Whereas, an originating summons is usually the appropriate method for applications to be made to the court or a judge thereof under any written law.

Once a writ of summons is served on the defendant, the defendant has 14 days to file a memorandum of appearance, failing which a default judgment may be entered against him. In legal proceedings commenced by originating summons, the defendant is not required to enter a memorandum of appearance.

Pleadings

Next is the pleadings stage. Pleadings are written documents which must be filed in court by the parties, which set out the respective cases of the parties. They contain the material facts which make up the basis of the claim or the defence to the claim, together with the reliefs sought by the parties. Usually, the pleadings will involve the following three documents:

• Statement of claim. A statement of claim can be served by the plaintiff on the defendant at any time after service of the writ but before the expiration of 14 days after that defendant enters an appearance. However, in practice, the statement of claim is served together with the writ of summons, unless there is a need or urgency to file the writ immediately;
• Statement of defence. A statement of defence must be served by the defendant on the plaintiff before the expiration of 14 days after the time limited for appearing or after the statement of claim is served on him (whichever is later). A statement of defence may also include a counterclaim within the same document; and
• Reply to the defence. A reply must be served by the plaintiff before the expiration of 14 days after the service of the defence. A reply may also include a defence to any counterclaim within the same document.

As for proceedings commenced by an originating summons, the plaintiff will also file and serve his supporting affidavit, which annexes the relevant documents in support of his claim. However, the defendant must file and serve an affidavit in reply to the affidavit in support within 21 days if he wishes to dispute the claim. Any further affidavits in reply must be filed within 14 days from the date of service of each affidavit.

Interlocutory applications and early disposal

Not every dispute proceeds all the way to a full trial. The Rules of Court 2012 provide several mechanisms by which a matter may be resolved, narrowed or secured at an interlocutory stage – that is, before trial. Where a defendant has no real defence to a claim, a plaintiff may apply for summary judgment to obtain judgment without the need for a trial. Conversely, a party may apply to strike out a pleading that discloses no reasonable cause of action or defence, or that is frivolous, vexatious or an abuse of process. Parties may also seek interim relief, such as an injunction to preserve the status quo or a Mareva injunction to freeze assets pending the outcome of the dispute.

It is worth noting that the Courts of Judicature (Amendment) Act 2022 has restricted certain appeals at this stage: an appeal no longer lies where a court has dismissed an application for summary judgment or striking out, or has allowed an application to set aside a default judgment. This reform was intended to curb the use of interlocutory appeals as a means of delaying the progress of a matter to trial.

Discovery of documents

The court will give pre-trial directions to the parties through pre-trial case management. These include the direction for the parties to exchange the relevant documents for the purpose of the proceedings. The parties are obligated to disclose all relevant documents, even those that undermine their case. This process, known as discovery, ensures transparency and allows each party access to the necessary information for a fair trial.

Once the documents are exchanged, the opposing party must classify the documents. Documents can be classified into three parts, mainly:

• Part A whereby parties agree to the authenticity and truth of the contents of the documents;
• Part B whereby parties agree to the authenticity of the documents, but not the truth of its contents; and
• Part C whereby parties agree to neither the authenticity nor the truth of the contents of the documents.

Trial stage

The trial is the central stage of litigation where parties present their cases through oral and documentary evidence. The trial of a writ will involve the oral evidence of witnesses. Parties may call factual witnesses and technical experts to support their cases. The evidence of the plaintiff’s witnesses is presented first by way of prepared witness statements. The witness is then tested and challenged in cross-examination by the defendant’s counsel. The plaintiff’s counsel will then have the opportunity to clarify the witness’ evidence in re-examination. The process is repeated for each of the plaintiff’s witnesses as well as the defendant’s witnesses.

Civil trials in Malaysia are conducted by a judge sitting alone, without a jury. The judge evaluates the evidence and the legal arguments presented by each side and decides the matter on the balance of probabilities – the civil standard of proof – rather than the higher criminal standard of beyond a reasonable doubt.

Written submissions and judgment

After the conclusion of the trial, the court will hear arguments by the parties’ counsel before proceeding to make its decision. These usually involve the filing of written submissions after trial, after which the court will fix a date for parties to present their submissions orally. However, in the subordinate courts, oral submissions are usually dispensed with and the court will make its decision based on the written submissions filed by the parties.

The importance of the written and oral submissions cannot be understated. They serve to assist the court in arriving at the correct decision by highlighting the relevant and material evidence, as well as the correct law to be applied in the case.

Appeals

A party dissatisfied with the decision of the court is not necessarily without recourse. Malaysia operates a two-tier appeal system. Where a matter originates in the Magistrates’ Court or the Sessions Court, the first appeal lies to the High Court; a further appeal may then lie to the Court of Appeal. Where a matter originates in the High Court in the exercise of its original jurisdiction, the first appeal lies to the Court of Appeal, and a further appeal may lie to the Federal Court, the apex court of Malaysia.

Appeals are not always available as of right. An appeal to the Court of Appeal generally requires leave where the amount or value of the subject matter of the claim is below RM250,000, and certain decisions are non-appealable under the Courts of Judicature Act 1964. An appeal to the Federal Court is more restricted still: a party must first obtain leave, which will only be granted in limited circumstances, such as where the appeal raises a novel question of law or a question of importance whose determination would be in the public interest. On appeal, the appellate court reviews the lower court’s decision for errors of law, fact or procedure, and may affirm, reverse or vary the judgment accordingly.

Enforcement of judgment

Obtaining a judgment is not always the end of the matter. Where a judgment debtor does not voluntarily satisfy the judgment, the successful party may need to take steps to enforce it. The principal modes of enforcing a money judgment include a writ of seizure and sale (by which the debtor’s movable or immovable property is seized and sold), garnishee proceedings (by which monies owed to the debtor by a third party, such as a bank, are intercepted), and judgment debtor summons. Where the debtor is a company, a winding-up petition may also be available, and against an individual, bankruptcy proceedings. The appropriate route will depend on the nature of the judgment and the assets available.

Foreign judgments may also be enforced in Malaysia. A monetary judgment from a superior court of a reciprocating country listed under the Reciprocal Enforcement of Judgments Act 1958 may be registered and enforced here; judgments from non-reciprocating jurisdictions must generally be enforced by way of a fresh action founded on the judgment.

A note on alternatives to litigation

Finally, litigation is not the only avenue for resolving a dispute, and is often not the most efficient. Mediation, arbitration and negotiated settlement frequently offer faster, more confidential and more commercially sensible outcomes, particularly for cross-border or relationship-sensitive matters. The Malaysian courts themselves actively encourage parties to explore settlement at various stages of proceedings. A considered assessment of these alternatives, before and during litigation, is an important part of any dispute resolution strategy.

Conclusion

The litigation process in Malaysia is a structured and comprehensive system designed to uphold the principles of justice, fairness, and due process. While it may be complex, the process aims to provide an effective means for parties to resolve their disputes and obtain a just and equitable outcome through the intervention of the judiciary. As Malaysia continues to evolve, so too does its litigation process, adapting to meet the changing needs of a dynamic legal landscape.

This article is written by Raja Nadhil Aqran (Partner) and only contains general information. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such. For further information, kindly contact info@aqranvijandran.com.

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