The plaintiffs commenced an action against the defendants for loss or damage to cargo carried on board the defendants' ship. The defendants' defence was that their liability was limited by the tonnage of the vessel under s 360 of the Malaysian Merchant Shipping Ordinance 1952 (the 1952 Ordinance), which is similar to art 1 of the International Convention relating to the Limitation of the Liability of Owners of Sea-Going Ships 1957 (the LLMC 1957), which allows for limitation of liability pursuant to the tonnage of the vessel where there was no actual fault or privity arising from the defendants.

The plaintiffs' response to the defendants' defence was that the 1952 Ordinance did not apply.

The trial concluded in 1999 and closing submissions were tendered in September 1999. On 18 January 2000, the defendants applied to amend their defence on the basis that s 360 of the 1952 Ordinance did not apply in Sabah and/or Sarawak but instead r 11 of Merchant Shipping (Implementation of Conventions Relating to Carriage of Goods by Sea and to Liability of Shipowners and Others) Regulations 1960 (the 1960 Regulations) applied. Regulation 11 of the 1960 Regulations is equivalent to s 360 of the 1952 Ordinance.

The defendants argued that the plaintiffs would not be prejudiced because r 11 of the 1960 Regulations and s 360 of the 1952 Ordinance are similar and in essence the defendants have not changed their defence. In any event, any prejudice suffered by the plaintiffs could be compensated by costs.

Held: The defendants' application to amend their defence was dismissed.

The court found that the 1960 Regulations instead of the 1952 Ordinance was applicable. However, the court disallowed the application because the prejudice suffered by the plaintiffs could not be compensated by costs. While the defendants were erroneously maintaining that the 1952 Ordinance applied at trial, the plaintiffs did not need to lead evidence in relation to the tonnage of the vessel because all the plaintiffs needed to do was to adopt the position that the 1952 Ordinance did not apply. If the defendants were now allowed to amend their defence after the trial had been completed and closing submissions had been tendered, the plaintiffs' prejudice would be severe as they would have lost their opportunity to lead evidence and make submissions in relation to the tonnage of the vessel. It was therefore too late to allow the amendments since the parties had concluded their case and it was pending judgment.