IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR (COMMERCIAL DIVISION)
SUIT NO. D22-NCC-220-2009
EXPORT – IMPORT BANK OF
MALAYSIA BERHAD … PLAINTIFF
1) PT EDEN CAPITAL INDONESIA
2) ROSLAN BIN NGAH
3) JAMAL BIN MOHD AMIN
4) MUHAMMAD ABDUH BIN ABDUH RAHMAN
GROUNDS OF DECISION (Encs. 8 & 13)
BEFORE HIS LORDSHIP TUAN ANANTHAM KASINATHER JUDGE HIGH COURT MALAYA
KUALA LUMPUR IN CHAMBER
By Facility Agreement dated 8th May 2007 (‘the Facility Agreement’) the Plaintiff granted a bridging loan in the amount of US$ 4,500,000 (‘the said loan’) to the said 1st Defendant. The said loan represented some 80 % of the costs of a project
involving the construction and development of apartment units in Jakarta, Indonesia (‘the project’). The terms of the Facility Agreement inter alia included the following:
a) The 1 Defendant to repay the said loan by way of redemption from the sale of units in the project;
b) The 1 Defendant to pay interest in relation to each drawdown of the said loan in three monthly intervals;
c) The Plaintiff entitled to declare the 1st Defendant in default upon inter alia the 1st Defendant failing to repay the principal sum and /or any one or more of the 3 monthly interest payment on the due dates and, in which event, the Plaintiff entitled to cancel the facility agreement and
d) Upon the cancellation of the facility agreement, the whole of the said loan together with all the accrued interest to become due and payable forthwith.
The Plaintiffs through their solicitors on 10th April 2009 cancelled the facility arising from the 1st Defendant’s failure to settle the said loan and outstanding interest (Exh. AA3 of Enc. 9). By the same letter, the said solicitors demanded repayment of the outstanding sums due and payable to the Plaintiff but to
no avail. The amount due and owing by the 1st Defendant to the Plaintiff as at 31st August 2009 is the sum of USD 4,066,129.41 together with interest at the rate of 3% p.a above the costs of funds (‘COF’) and further interest of 2% p.a over the prescribed rate by way of late payment charges from 1st September 2009 till payment. The COF as of that date was 1.50 p.a.
By joint and several guarantee dated 8th May 2007, the 2nd 3rd and 4th Defendants unconditionally and irrevocably guaranteed as a continue obligation to the Plaintiff as principal debtor and not merely as sureties to pay on demand, any amount that may be due from the 1st Defendant to the Plaintiff (Exh. AA2 of Enc. 9). The 2nd to the 4th Defendants by the same document also guaranteed the due performance by the 1st Defendant of all its obligations under the facility Agreement up to a maximum amount of US$ 4,500,000. The 2nd to the 4th Defendants agreed to discharge their obligation under the guarantee upon the receipt of a demand for payment. The Plaintiff through its solicitors caused a letter of demand to be dispatched to the 2nd to the 4th Defendants vide its letter dated 10th April 2009.
Counsel for the Defendants in the course of his oral submission primarily relied on two issues as amounting to a triable issues. The first issue raised by Counsel was that the loans advanced by the Plaintiff were secured and the Plaintiff should have realised the security before commencing this
claim. With respect, the simple answer to this submission is that both, under the agreement and, in law, there is no such obligation on the Plaintiff. Under clause 14.2 of the facility agreement, the Plaintiff has the right to exercise all or any of the remedies available to it, in such order as it deems fit. Furthermore, the Courts in Malaysia have consistently recognized the right of a lender such as the Plaintiff to pursue all remedies available to it as against the borrower such as the 1st Defendant simultaneously, contemporaneously, or successively unless precluded by the terms of the agreement (See Chan Boi Loi v. Public Bank Bhd & another (2009) 6 CLJ 81). Accordingly, there is no merit in this submission.
The second issue raised by Counsel was that the 1st Defendant was not in default. Again, the simple answer to this submission is that, upon the Plaintiff discharging the burden imputed to it under the rules of Court as the applicant to a summary judgment application, the burden shifts to the Defendants to satisfy the Court why judgment should not be given against them (see National Company For Foreign Trade v. Kayu Ara Sdn Bhd (1984) 1 CLJ (reprint) 283). The 1st Defendant while alleging to be not in default produced no evidence whatsoever of any payment having been made by it or the basis for its claim in the affidavits affirmed on its behalf that it had serviced the loan account. In the absence of such evidence, this Court is obliged to allow the Plaintiff to sign final judgment.
Since Counsel for Defendants was unable to discharge the burden vested on the Defendants, I allow Encs. 8 and Enc. 13 with costs. The Plaintiff is hereby granted leave to sign final judgment against all four Defendants in the sum of US$ 4,066,129.41 together with interest at the rate of 3% above the cost of funds which presently is 1.5%, thereby entitling the Plaintiff to levy interest on the judgment sum at the rate of 4.5% p.a. from 31st August 2009 till payment. The Plaintiff is granted leave to levy further interest at the rate of 2% p.a. on the judgment sum from 1st September 2009 till payment. I order the Defendants to pay costs of RM 350 to the Plaintiff.
Pesuruhjaya Kehakiman Mahkamah Tinggi Kuala Lumpur
Date of Decision: 15th July 2010
(Tetuan Khairuddin Ngiam & Tan) … for the Plaintiff Mr. Adnan Saman
(Tetuan Adnan Sharida & Associates) … for the Defendants