Judgment

Abdul Hamid Said, J

1. The 18 plaintiffs (the plaintiffs) in this case were customers of the defendant i.e. Mayban Finance Bhd. The plaintiffs had hired the safe deposit boxes located at the defendant's premises at the Taman Cheras Branch, Kuala Lumpur, It is not disputed that there was a break-in at the defendant's premises. It happened between 4.30 p.m. (a Thursday) on March 2, 1995 and the morning of March 6, 1995 (a Monday). PW1 in his examination-in-chief stated that from what he could gather after the event was that the burglars entered a monsoon drain in the vicinity of the premises, and then entered an underground drain which led to the area outside the main front entrance of the premises. They then tunnelled their way underground for a distance of approximately 40-45 feet until they were directly beneath the strong room floor. They then dug their way through the strong room floor into the strong room and proceeded to break open and empty the safe deposit boxes therein.

2. The plaintiffs filed this claim and prayed for the delivery of the goods or alternatively, they prayed for damages for the loss of the goods, interest and costs.

3. The parties have agreed that the hearing before the court was only to determine liability. Damages would be determined by the deputy registrar or the senior assistant registrar.

4. In the claim the plaintiffs pleaded causes of action in bailment, contract and tort. At the submissions counsel for the plaintiffs dropped their claim in bailment and proceeded on contract and tort only.

5. The defendant contends that the burden of proof lies on the plaintiffs. In Nanyang Development [1966] Sdn Bhd v How Swee Poh [1970] 1 MLJ 146, the Federal Court held that—

   the burden of proving a fact rests on the party who substantially asserts the affirmative of the issue and not upon the party who denies it: for a negative is usually incapable of proof.

   See also ss 101-103 of the Evidence Act 1950.

6. The plaintiffs had however also pleaded res ipsa loquitor which means "the thing speaks for itself." The effect of this would be to shift the burden of proof from the plaintiffs to the defendant.

7. There are many reported cases on res ipsa loquitor. However both counsel quoted the case of Wong Eng v Chock Mun Chong [1963] 29 MLJ 204. In this case Gill J, as he then was, quoted Kennedy LJ, as he then was, in Russel v London & South Western Railway Co [1908] 24 TLR 548:

   I understand the passage to mean that, .... there is, in the circumstances of the particular case — (in the case of this particular case) some evidence which .... of reasonable argument, makes it more probable .... there was some negligence, upon the facts as shown and undisputed, than that the occurrence took place without negligence .... the facts stand unexplained, and therefore the natural and reasonable, not conjectural inference from the facts shows that what has happened is reasonably to be attributed to some act of negligence on the part of somebody; .... some want of reasonable care under the circumstances .... It means that the circumstances are, so to speak, eloquent of the negligence of somebody who brought about the state of things which is complained of.

8. The issue therefore is whether there was "some act of negligence" on the part of the defendant. The House of Lords in Bolton v Stone [1951] AC 850 reinforces this at p 159:

   .... where the circumstances giving rise to the cause of the accident are unknown that doctrine (i.e. res ipsa loquitor - my addition) may be of great assistance, but where as in the present case all the facts are known, it cannot have any application .....; the only question is, do the facts or omissions which are known and which led up to amount to negligence.

9. I am of the opinion the facts i.e. cause of the loss are known and res ipsa loquitor has no application to the facts of this case. This is a case of negligence. The issue therefore is whether there was some want of care by the defendant. It was not denied that the plaintiffs hired the safety boxes at the defendant's premises. March 2, 1995 to March 6, 1995 was the long Hari Raya break. The defendant's premises was empty i.e. no workers. There was no security guard.

10. There was however, what was alleged, a comprehensive alarm system, provided by a company said to be "a leading provider of security systems."

11. The alarm system was connected to the central monitoring system (CMS). In the event the alarm goes off, the people monitoring the "system" would inform the employees of the bank, in this case anyone of the two employees of the defendant. They have the keys to the premises to check the inside of the premises whenever the alarm is activated. The alarm provider would then send their own security team to the premises. The centre also informed the police.

12. On March 3, 1995 at about 11.59 a.m. (the long break began on March 2, 1995) the alarm was triggered. The CMS people sent their security people to the defendant's premises. The police was also informed. The CMS and the police were not able to go into the premises as the two key holders could not be contacted. The alarm turned off by itself after 15 minutes. There was no instruction from the defendant's headquarters that one of the key holders had to be available all the time. Neither was there any explanation why both were not available. Realising this problem the defendant's manager, internal audit, in hind sight issued on March 10, 1995 an inter office memo to all branch managers "....to ensure that at least one key holder is available for contact during non-working hours ...." (See IDE p 17).

13. In Shelton v ANZ Banking Group [1984] VIC LEXIS 329, (Shelton), the Supreme Court in Victoria held at p 12 that:

    Any banking system of security would, I find, require that following an alarm, prompt attendance at the bank should follow. Such a system was not in force at the Windsor Branch on November 17, 1981.

14. In the present case the system was there. Two officers of the defendant had the keys to open the bank upon being contacted by the CMS. Unfortunately none of the officers were available. The security system provider supervisor, SD2, stated that the alarm that went off also came from the strong room zone. SP3 in his evidence stated that the burgofon in the safe deposit room was re-activated. (The burgofon was covered with silicone by the burglars). SP3 also informed the court that it would be better to have infra-red motion detector. The security system assumes the key holders to be readily available when the alarm is activated. The defendant had failed to do this. This is therefore a clear case of negligence on the part of the defendant and/or its servants or agents.

15. In Shelton, the Supreme Court of Victoria observed at p 12 that:

    By 1981, technology had moved far ahead of its position as at 1966. Long before 1981 seismic devices were preferred to acoustic devices. Perimeter alarms and space detectors, whether microwave/ultrasonic or passive infra-red, had been developed. In fact immediately after the robbery, seismic detectors were installed and in the vault and ultrasonic detectors were installed guarding the approach to the vault ....

16. The above serves the purpose that there are devices or detectors as early as 1981 that are available in the market to ensure the safety of the plaintiffs' valuables in the defendant's safes. I am of the opinion it is for the defendant to be aware of the existence of these devices and to use them to protect the plaintiffs' valuables. It is in my opinion insufficient to rely only on the alarm unless the price of the additional devices is extremely excessive.

17. The defendant in his submission contends that the risk of a break-in in the manner in which it occurred was too remote and such a break-in was not reasonably likely to happen. Because of the remoteness of the risk that the burglars would enter the strong room in the manner described above, the defendant did not take steps to reinforce the floor of the safe deposit box room. The defendant was also not advised to connect the room floor to the alarm system.

18. It is an issue of negligence i.e. to exercise reasonable care. In the case of Government of Malaysia v Jumaat Mahmud [1977] 2 MLJ 103, the Federal Court at p 104 decided:

    .... in considering whether or not the appellants were in breach of their duty of care to the respondent it was necessary for the trial judge to consider first whether the risks of injury to the plaintiff were reasonably foreseeable and second, assuming it was, whether the appellants took reasonable steps to protect the plaintiff against those risks .... The issue therefore ".... ex hypothesis (the teacher) should reasonably have foreseen". See Richard v State of Victoria [1969] VR 139, 141.

19. The standard of care defined in Bolton v Stone [1951] AC 850 states at p 863:

    The standard of care in the law of negligence is the standard of an ordinary careful man, but in my opinion an ordinary careful man does not take precautions against every foreseeable risks .... many foreseeable risks are extremely unlikely to happen and cannot be guarded against except by almost complete isolation. I remind myself that Bolton v Stone was a case involving a cricket ball that hit Miss Stone while standing on the highway outside her house. The ball was hit by a batsman in a cricket match played on a cricket ground. I would however like to venture that in this century the decision in Bolton v Stone may be different with new equipments in use and the more efficient techniques practised in the game of cricket.

20. Be that as it may the definition of standard of care of that of an ordinary man still stands. The issue is whether the defendant compromised the safety of the plaintiffs' valuables by not putting in additional or advanced security system or devices in the premises. Was it reasonably foreseeable that the additional or advanced device would enhance the security of the strong room.

21. In commenting on the decision of the House of Lords in Bolton v Stone, the Privy Council in Overseas Tankship (UK) Ltd v The Miller Steamship Co Pty [1961] AC 617, p 642 (Wagon Mound No.2):

    .... The House of Lords held that the risk was so small that in the circumstances a reasonable man would have been justified in disregarding it and taking no steps to eliminate it. But it does not follow that no matter what the circumstances may be it is justifiable to neglect a risk of such small magnitude. A reasonable man would only neglect such a risk if he had some valid reason for doing so .... In their lordship's judgment Bolton v Stone did not alter the general principle that a person must be regarded as negligent if he does not take steps to eliminate a risk which he knows or ought to know is a real risk and not a mere possibility which would never influence the mind of a reasonable man ....

22. By 1981 there were many sophisticated security devices and systems available in the market. It is the duty of the defendant to be up to date on the availability of the security devices in the market to ensure the safety of the strong room. For the defendant to rely only on the advice of a company is not complimentary. The House of Lords in the Wagon Mound No.2 held at (2) p 618:

    That, on the facts, a reasonable man having the knowledge and experience to be expected of the appellants chief engineer would have known that there was a real risk of the oil on the water catching fire and the fact the risk was small did not in the circumstances justify no steps being taken to eliminate.

23. If in the Wagon Mound No.2, the reasonable man was the chief engineer, in this case it is a banker. A banker should have foreseen that it is not sufficient to have what I would call a basic security system and/or devices in the defendant's premises that stores so much cash and valuables. There was no evidence that a security expert was employed to ensure the safety of the plaintiffs' valuables. The so called security system did not have the infra-red motion detector. It is reasonably foreseeable to my mind to have the infra-red motion detector on the floor of the strong room as burglars would be attracted to the valuables in the strong room and would employ whatever means to get at them. It is therefore foreseeable that the seismic detectors or infra-red motion detector would be valuable devices to protect the floor of the strong room and the valuables therein.

24. It is my finding that as a reasonable banker of their standing, the defendant had failed to ensure (make certain) that the "valuables" were safely kept and taken care of. My finding is based upon the failure of the defendant to act when the alarm was activated and the fact that they have failed to put in additional security device(s).

25. I therefore hold the defendant wholly liable for the loss. I also award costs to the plaintiffs. The deputy registrar is to fix an early date to assess the damages.

Cases

Bolton v Stone [1951] AC 850, HL; Government of Malaysia v Jumaat Mahmud [1977] 2 MLJ 103, FC; Nanyang Development [1966] Sdn Bhd v How Swee Poh [1970] 1 MLJ 145, FC; Overseas Tankship (UK) Ltd v The Miller Steamship Co Pty (Wagon Mound No.2) [1961] AC 617, PC; Russel v London & South Western Railway Co [1908] 24 TLR 548, HL; Shelton v ANZ Banking Group [1984] VIC LEXIS 329, SC; Wong Eng v Chock Mun Chong [1963] 29 MLJ 204, HC

Legislations

Evidence Act 1950: s.101, s.102, s.103

Representations

Murali Achan (K Kulakesar Achan &L Associate) for plaintiffs

Dhinesh Bhaskara (Shearn Delamore & Co) for defendant

Notes:-

This decision is also reported at [2003] 5 AMR 70