What is a litigant’s recourse when the opponent defaults in complying with timelines in a consent judgment? In Stadco Sdn Bhd v. Cherating Development Sdn Bhd & Anor [2022] 1 LNS 3328, the High Court considered the reliefs to be granted in such a scenario i.e., an extension of the initial timelines, damages, and insertion of a penal endorsement.
The plaintiff had entered into sale and purchase agreements of shop offices with the first defendant. The second defendant subsequently took over the development from the first defendant. The plaintiff and the second defendant later recorded a consent judgment before the Court of Appeal. The consent judgment specified fixed periods for the second defendant to complete the construction of shop offices and to hand over vacant possession of the properties to the plaintiff.
When the second defendant failed to comply with these fixed timelines, the plaintiff applied to the High Court for the initial timelines to be extended, damages to be assessed for the period from the expiry of the deadlines in the consent judgment until compliance, and a penal endorsement in the event of non-compliance of the new timelines.
Jurisdiction
On the issue of jurisdiction, the High Court reiterated the principle that even though the consent judgment in question was recorded in the Court of Appeal, enforcement comes within the purview of the High Court in which the action was filed.
Can a perfected judgement be altered?
The timelines are stipulated in the consent judgment, which had been sealed and perfected. However, the consent judgment is silent on damages being payable in the event of delay in compliance. It also does not contain any penal endorsement. The second defendant contended that the plaintiff’s application would tantamount to an attempt to alter the terms of the consent judgment, which should not be allowed.
The High Court held that apart from altering a perfected judgment under the slip rule, the court may also alter the terms of a perfected judgment for purposes of enforcement of the judgment, which contains a clause granting parties liberty to apply. Therefore, the High Court allowed an extension of time for the initial timelines.
Penal endorsement
The High Court further held that it was necessary for a penal endorsement to be inserted for the new extended timelines, to deter the second defendant from any further delay in compliance.
Damages
On the claim for damages, the High Court ordered damages to be assessed as the consent judgment clearly provides that parties are still bound by the terms of the sale and purchase agreements, which contain a clause for damages in the event of delay in completion.
The High Court’s decision leaves no room for any doubt that a perfected consent judgment with a clause for liberty to apply may be enforced by altering the terms therein. It would be prudent for litigants to ensure that a judgment requiring a party to do an act within a fixed time includes a clause on liberty to apply.
