1. ) Sureendhran Subramaniam v 1. ) Lush Development Sdn. Bhd (WA-22NCvC-474-07/2019)

SUREENDHRAN SUBRAMANIAM

SARASWATHY A/P KRISNASAMAY (NO. K/P: 810208-10-5616) …PLAINTIF-PLAINTIF

LUSH DEVELOPMENT SDN BHD

ALLIANCE BANK MALAYSIA BERHAD (NO. SYARIKAT: 198201008390 (88103-W)) …DEFENDAN-DEFENDAN GROUNDS OF JUDGMENT (After Full Trial) A. Introduction [1] This is the Plaintiffs’ claim (‘this Claim’) against the 1st Defendant for false representations by the 1st Defendant’s agent to induce the Plaintiffs into executing the Sale and Purchase Agreement (‘the said SPA’) and Deed of Mutual Covenant dated 25.04.2017. The subject matter of the said SPA and Deed of Mutual Covenant was for a 3-storey semi-detached house known as AK113, Phase RP05, type B, Akira 16 Sierra held under individual property HS (D) 31944, PT No. 45153, Mukim Dengkil, Sepang District, State of Selangor (‘the said Property’). The 2nd Defendant as the financier assisting the Plaintiffs in the purchase of the said Property was later added as a co-defendant in this Claim. B. The Background Facts [2] At all material times, the 1st and 2nd Plaintiffs are spouses and are the registered owner of the said Property. The Plaintiffs had entered into the said SPA and Deed of Mutual Covenant with the 1st Defendant, who was the developer of the said Property for a purchase price of RM2,348,800.00. 23/06/2022 15:26:40 WA-22NCvC-474-07/2019 Kand. 67 S/N XckdttdA0yQlJtEo9IJeQ [3] In order to purchase the said Property, the Plaintiffs had taken up a housing and overdraft loan (‘the Loan Facilities’) from the 2nd Defendant for the amount of RM1,561,765.60 and RM200,000.00, respectively. As a security, the Plaintiffs had created a charge for the said Property (No. 72179/2019) which was registered on 14.08.2019 in favour of the 2nd Defendant. Later, the 2nd Defendant disbursed the loan sum amounted to RM1,726,000 to the 1st Defendant. [4] However, on 08.03.2019, the Plaintiffs sent a Notice of Rescission to the 1st Defendant to rescind the said SPA claiming that there was a false representation. The Plaintiffs alleged that the 1st Defendant’s agent had falsely misrepresented that the Plaintiffs would be able to enjoy an unimpeded view from the balcony and master bedroom from the said Property. Yet, it was later discovered that the MRT 2 Line would be constructed immediately behind the said Property which the Plaintiffs alleged that could impede the view entirely. The noise pollution also raised a problem for the Plaintiffs because of the proximity of the MRT 2 Line. [5] On the contrary, the 1st Defendant in brief argued that there was no false misrepresentation as the Plaintiffs were well aware on the construction of the MRT 2 Line. Moreover, the said SPA had already been duly executed by the parties thus the Plaintiffs are not entitled to rescind the said SPA. Thus, the remedy of rescissions was not available in a case of innocent misrepresentation involving a completed sale and purchase agreement. [6] The Plaintiffs then alleged that 1st Defendant had woefully failed to prove that the MRT 2 Line was in existence prior to the execution of the said SPA and the Deed of Mutual Agreement and that the said information was indeed contained in the brochure. Thus, the Plaintiffs in essence seek, inter alia, for the following – “a) Suatu Perintah bahawa Perjanjian Jual Beli bertarikh 25.04.2017 dibatalkan; b) Suatu Perintah bahawa “Deed of Mutual Covenant” bertarikh 25.04.2017 dibatalkan; c) Suaut deklarasi bahawa kesemua wang yang dibayar kepada Defendan oleh Alliance Bank (M) Berhad sebagai pembiayaan pembelian Rumah tersebut sebanyak RM1,761,765.60 dipulangkan kepada Alliance Bank (M) S/N XckdttdA0yQlJtEo9IJeQ Berhad dalam masa 7 hari dari tarikh perintah ini beserta dengan faedah pada kadar 5% setahun daripada tarikh Writ Saman sehingga ke tarikh penyelesaian penuh” [7] The 1st Defendant contended that the Plaintiffs have failed to prove the very essence of their claim by only relying on the Plaintiffs’ witnesses without any cogent evidence such as a photo of the alleged impeded view. [8] The 1st Defendant had counter-claimed for the followings – “(a) Penghakiman untuk wang sejumlah RM196,695.51 setakat 28.3.2019;

Faedah pada kadar 10% setahun atas jumlah RM145,586.00 dari tarikh 29.3.2019 sehingga penyelesaian penuh” [9] Subsequently, the 2nd Defendant as the chargee of the said Property terminated the Loan Facilities and counter-claimed against the Plaintiffs demanding the outstanding sums for both loans of RM1,573,956.47 and RM203,699.38 including interest, respectively. [10] The 2nd Defendant also initiated a foreclosure proceeding in the High Court of Shah Alam and was allowed. An order for sale was granted to the 2nd Defendant and no appeal was made by the Plaintiffs for the said order for sale. The 2nd Defendant in its counterclaim seeks for – “(a) Suatu deklarasi bahawa Defendan Kedua, Alliance Bank Malaysia Berhad sebagai Pemegang Gadaian berdaftar sah keatas Hartanah tersebut adalah merupakan pembeli yang secara suci hati untuk balasan bernilai (‘subsequent purchaser in good faith and for valuable consideration’) telah memperolehi kepentingan yang tidak boleh disangkal, sah dan berkuatkuasa di dalam Hartanah tersebut melalui Gadaian Perserahan No. 72179/2019 yang didaftarkan pada 14/08/2019 ke atas Hartana tersebut sebagai jaminan sekuriti untuk Pinjaman Kemudahan tersebut dan oleh itu kepentingan Defendan Kedua adalah terpelihara sepertimana menurut Seksyen 340(3) Kanun Tanah Negara, 1965;

Satu deklarasi bahawa Defendan Kedua, Alliance Bank Malaysia Berhad sebagai Pemegang Gadaian berdaftar yang sah melalui Gadaian Perserahan No. 72179/2019 yang didaftarkan pada 14/08/2019 ke atas Hartanah tersebut sebagai jaminan sekuriti untuk Pinjaman Kemudahan tersebut berhak untuk melaksanakn dan/atau menguatkuasakan segala hak-hak dan remedi-remedi yang telah diperuntukkan kepadanya dibawah dokumen-dokumen sekuriti dan juga dibawah undang-undang Kanun Tanah Negara, 1965 keatas Hartanah tersebut;

Selanjutnya, suatu penghakiman bahawa jumlah yang perlu dibayar oleh Plaintif-Plaintif (secara bersesama dan berasingan) (“jointly and severally”)) sebagai Penggadai-Penggadai kepada Defendan Kedua di bawah Akaun No. 122200052034711 adalah sebanyak RM1,799,739.85 pengiraan setakat 04/05/2021, dengan faedah pada kadar 0.65% setahun di atas Kadar Asas (Kadar Asar setakat 04/05/2021 adalah 2.57%) mengikut pengiraan baki harian, berserta dengan tambahan faedah penalti pada ladar 1.00% setahun ke atas ansuran tertunggak dikira sehingga penyelesaian sepenuhnya;

Suatu penghakiman bahawa jumlah yang perlu dibayar oleh Plaintif-Plaintif (secara bersesama dan berasingan (“jointly and severally”)) sebagai Penggadai-Penggadai kepada Defendan Kedua di bawah Akaun No. 121180010068961 adalah sebanyak RM235,365.28 pengiraan setakat 04/05/2021, dengan faedah pada kadar 3.06% setahun di atas Kadar Asas (Kadar Asas setakat 04/05/2021 adalah 2.57%) berserta dengan tambahan faedah penalty pada kadar 1.00% setahun ke atas ansuran tertunggak dikira sehingga penyelesaian sepenuhnya.” C. Trial [11] The Plaintiffs called one (1) witness during the trial, while the Defendants called six (6) witnesses in total. The seven (7) witnesses were: PW1 Surrendhran Subramaniam DW1 Hew Cheong Loong DW2 Chong Shey Shin DW3 Michelle Leong Pik Tho DW4 Nicholas Poon Tuck Kah S/N XckdttdA0yQlJtEo9IJeQ DW5 Tah Poh Ming DW6 Zafirah Binti Zabidin [12] PW1 who is 1st Plaintiff himself, among others, testified that the 1st Defendant’s agent had made several representations to the Plaintiffs which induced their decision to purchase the said Property. PW1 also testified that the MRT 2 line was approved as early as 07.10.2015 but the 1st Defendant failed to mention it in the brochure which the Plaintiffs had relied on. Furthermore, the 1st Defendant also make a false representation to the 2nd Defendant that the differential sum had already been paid by the Plaintiffs. This resulted in the release of the balance purchase price by the 2nd Defendant to the 1st Defendant. [13] Meanwhile, the 1st Defendant called four witnesses. DW1 at the material time was the property agent who worked for the 1st Defendant. DW1 testified that prior to the signing of the sale and purchase agreement, he had disclosed that there would be a construction of MRT Line 2 station and track along the 100ft road, located at the back of the said Property. DW1 also stated that it was stated in the brochure that ‘there is proposed MRT Line 2 Station 33’ to promote the said Property strategic location and connectivity. [14] DW2 is also a property agent for the 1st Defendant. He testified that he only dealt with the Plaintiffs once during their visit to Akira Showhouse and to the unit that the Plaintiffs were purchasing. DW2 also mentioned that the Plaintiffs never asked him about the MRT Line 2 as DW1 had already informed the Plaintiffs regarding the matter. [15] DW3 was the sales administration manager of the 1st Defendant at the material time. DW3 testified that a notice had already been issued to the Plaintiffs regarding the delivery of the vacant possession. DW3 explained that the 1st Defendant’s counterclaim is for the outstanding sum from a payment by instalment facility (“Deferred Payment Scheme”) that the Plaintiffs had entered into. [16] She also stated that the Deferred Payment Scheme was between the Plaintiffs and the 1st Defendant and does not involve the 2nd Defendant. The differential sum was deemed to be paid when the Plaintiffs entered the Deferred Payment Scheme. S/N XckdttdA0yQlJtEo9IJeQ They however were indebted to the 1st Defendant under the Deferred Payment Scheme until the balance under it has been fully paid off. [17] DW4 is the sales and marketing manager of the 1st Defendant. DW4 testified that the Plaintiffs knew that MRT Line 2 would be constructed near the said Property. He also mentioned that DW1 had proposed to the Plaintiffs to change the said Property with another property, but the Plaintiffs did not take the offer and proceed to serve the 1st Defendant with the Notice of Rescission. [18] Meanwhile, the 2nd Defendant had called two witnesses to support its counterclaim against the Plaintiffs. DW5 was the lawyer who handled the loan documentation for the loan granted by the 2nd Defendant to the Plaintiffs. DW5 stated that the release of the balance purchase price was based on the confirmation from the 1st Defendant. She also mentioned that there was no such requirement for additional evidence of payment as confirmation from the 1st Defendant is sufficient enough. [19] Meanwhile, DW6 is the manager in the collection, litigation, and recoveries department for the 2nd Defendant. DW6 affirmed that the 2nd Defendant had started a foreclosure proceeding against the Plaintiffs in the High Court of Shah Alam. DW6 also confirmed that the order for sale had already been granted and the Plaintiffs had never challenged or made any appeal for the said order. D. Decisions and Findings of this Court [20] Basically, the Plaintiffs’ claim against the 1st Defendant was on the alleged false misrepresentation made by the 1st Defendant which allegedly induced the Plaintiffs to enter into the said SPA and Deed of Mutual Covenant dated 25.04.2017. After perusing the cause papers, the witnesses’ statements, the notes of proceeding, the written and oral submissions, and the parties’ replies, I dismiss the Plaintiffs’ claim and allow both counterclaims of the 1st and 2nd Defendants respectively. Herein are my reasons. I. The Representation about the unimpeded View of the said Property [21] In respect of this Claim, I will first deal with the Plaintiffs’ claim against the 1st Defendant. It is a trite law that when a party signs a contract knowing it to be a contract S/N XckdttdA0yQlJtEo9IJeQ which governs the relations between them, like the present case, then, to use the words of Denning J (as he then was) in Curtis v Chemical Cleaning & Dyeing Co Ltd [1951] 1 All ER 631, ‘his signature is irrefragable evidence of his assent to the whole contract, including the exempting clauses, unless the signature is shown to be obtained by fraud or misrepresentation.’ Way back in 1934, Scrutton LJ said in L’Estrange v F Graucob Ltd [1934] 2 KB 394 that ‘when a document containing contractual terms is signed, then, in the absence of fraud, I will add, misrepresentation, the party signing it is bound, and it is wholly immaterial whether he has read the document or not.’ (See also the ratio of Abdul Malik Ishak J in Wan Salimah Bte Wan Jaffar v Mahmood Bin Omar (Anim Bt Abdul Aziz, Intervener) [1998] 5 MLJ 162) [22] Section 18 of the Contracts Act 1950 provides the definition of ‘Misrepresentation’ as – “Misrepresentation 18. “Misrepresentation” includes –

the positive assertion, in a manner not warranted by the information of the person making it, of that which is not true, though he believes it to be true;

any breach of duty which, without an intent to deceive, gives an advantage to the person committing it, or anyone claiming under him, by misleading another to his prejudice, or to the prejudice of anyone claiming under him; and

causing, however innocently, a party to an agreement to make a mistake as to the substance of the thing which is the subject of the agreement.” [23] This Section 18 must be read together with Section 19, which states the effect of such a contract entered by misrepresentation: “Voidability of agreements without free consent”

19.

When a consent to an agreement is caused by coercion, fraud, or misrepresentation, the agreement is a contract voidable at the option of the party whose consent was so caused.

A party to a contract, whose consent was caused by fraud or misrepresentation, may, if he thinks fit, insist that the contract shall be S/N XckdttdA0yQlJtEo9IJeQ performed, and that he shall be put in the position in which he would have been if the representations made had been true.” [24] In Sim Thong Realty Sdn Bhd v Teh Kim Dar @ Tee Kim [2003] 3 MLJ 460, His Lordship Gopal Sri Ram JCA (as he then was) has succinctly listed the elements of an actionable misrepresentation at p. 465: “Now the elements of an actionable misrepresentation are well settled. They are set out as follows in Professor McKendrick’s Contract Law (3rd Ed), a leading work on the subject: A misrepresentation may be defined as an unambiguous, false statement of fact which is addressed to the party misled and which materially induces the contract. This definition may be broken into three distinct elements. The first is that the representation must be an unambiguous false statement of fact, the second is that it must be addressed to the party misled and third is that it must be a material inducement to entry into the contract.” [Emphasis added] [25] The legal burden is on the party who claims that the misrepresentation had induced him to enter into the contract. This Court find valuable guidance from Sim Thong Realty (supra) which explained the following (at p. 466 – 467, para I – C): “It is clear from s 19(1) that it reproduces the English common law whereby a misrepresentation, whether innocent or fraudulent, would entitle the innocent party to rescind a contract. The Explanation to s 19(1) enacts the common law requirement that the misrepresentation must induce the contract. Now we think that we should say a word about this point. It has to do with the onus of proof. As a general rule, the burden is on a representee to show that the misrepresentation induced him to enter into the contract (see Kuppuswami Chettiar v Arumugam Chettiar AIR 1967 SC 1395).” [Emphasis added] [26] As such, in our case, the Plaintiffs need to prove to this Court that the alleged misrepresentation by 1st Defendant had induced them to enter into the said SPA. The Plaintiffs’ witness 1 (PW1), who was also the 1st Plaintiff stated the alleged misrepresentation in Q&A 3 of his own witness statement – S/N XckdttdA0yQlJtEo9IJeQ Q3: Could you elaborate further on the representations that were made to you and your wife? A3: Prior to signing the Sale and Purchase Agreement on the 25.04.2017, my wife and I visited the Sales Gallery of the First Defendant. We were introduced to an agent of theirs known as Gavin who gave us a brochure of a leasehold development known as Sierra 9, Akira. Having looked at the brochure, my wife and I were quite enamoured of its contents. We then told Gavin that we would like to see a house facing north. Gavin proposed we look at Unit 7 which we did. We viewed the house and liked the fact that the balcony and master bedrooms were facing an open view at the back of the house. We then asked Gavin for a unit that was placed on a high ground and he recommended Unit No. 5. We made it very clear to Gavin that the factor that convinced us that the said Unit 5 would be worth purchasing is the unimpeded view from the balcony of the master bedroom at the back of the house. We then asked Gavin about the so called “proposed” MRT Line 2 Station 33 that is mentioned in the brochure in page 49 CBOD Part A and B. Gavin informed us that the MRT line is merely at the proposal stage and nothing definitive has been made regards the MRT line. By this Gavin said that the plans for the MRT line had yet to be approved by the relevant authorities. Gavi also assured us that if and when the MRT Station and Line are indeed erected it will not have any impact on the enjoyment of our property. He further assured us that the view from the rear master bedroom will continue to be unimpeded even after the MRT Line and Station is erected. [27] Further in Q&A 5 and 6 of PW1’s own witness statement – Q5: What was the impression you and your wife obtained from the brochure? A5: The impression my wife and I obtained was that Akira @ 16 Sierra Township was a rural/bucolic themed development that was intended to S/N XckdttdA0yQlJtEo9IJeQ bring its occupants closer to nature particularly with the use of words like “shade”, “rain forest garden” and “themed garden”. It gave the impression of a rural idyll where we could raise our three children in a serene and tranquil environment, Based on the information on the brochure and the representations made by Gavin, my wife and I executed the Sale and Purchase Agreement and Deed of Mutual Covenant dated 25.04.2017. Q6: Please tell the Court what had transpired next? A6: Sometime in May 2018, I discovered that the MRT Line was erected directly behind the Unit No 5. The MRT line was constructed immediately behind my house and it severely impedes the view from the balcony of our house. I subsequently discovered that the plans for the MRT station and the Lines leading to it were approved as early as 7.10.2015 and the First Defendants were fully aware of this. See page 4 to 11 CBOD Part B The First Defendants chose not mention this very salient fact in the brochure so as not to deter potential home buyers from purchasing the units. This rendered all the representations by Gavin that the MRT stations and the lines thereto will not impeded the view from our balcony untrue. Further the noise pollution from the daily operations of the LRT is opposite to the serene and tranquil environment as promised in the brochure. One can hardly expect an MRT station and its connecting lines in a garden setting. [28] It is to be noted that the requirement of unimpeded view from the balcony of the said Property was never listed or mentioned in any way in the said SPA or in the Deed of Mutual Covenant. PW1 admitted this during cross-examination – [NOP at page 10] Now, in the 4th paragraph of your Q&A 3, you have said this, we then asked Gavin for a unit that was placed on a higher ground and he S/N XckdttdA0yQlJtEo9IJeQ recommended unit no. 5. We made it very clear to Gavin meaning we made it very clear to Hew that the factor that convinced us that the said unit 5 would be worth purchasing is the unimpeded view from the balcony of the master bedroom at the back of the house. Now, when you say that you have made it very clear to Mr Hew that this is the factor that convinced us meaning you and the 2nd Plaintiff to make the purchase was this stated anywhere in writing at least since it such a, it appears to be the single most important factor that actually led you to purchasing the property, was this place in writing anywhere after you had agreed to purchase the property, the payment of the booking fee? PW1: Requirement in writing? Yes. Is there anything in writing? PW1: No. [NOP at page 12] – So this particular type of property that you purchased. Now under feature highlights. Can you see feature highlights include? Do you see anything stated in the part of the page which suggest that there is going to be an unimpeded view from the Balcony of the master bedroom at the back of the house? PW1: No it doesn’t. [29] The Plaintiffs further contended that it was stated in the brochure that the MRT 2 line was only “proposed”, and the said Property was a rural/bucolic themed development which highlighted the words like “shade”, “rain forest garden” and “themed garden”. Thus, it was clear that the contents of the brochure were wrong. S/N XckdttdA0yQlJtEo9IJeQ [30] However, I have to disagree. As submitted by the learned counsel of the 1st Defendant, the representation found in the brochure in relation to the said Property has not resulted in something different than what it actually was. It was also pointed out by the 1st Defendant witness 1 (DW1) in his testimony during cross-examination that the contents and photos in the brochure were for impression only. DW1 had also further confirmed this during re-examination – [NOP at page 124] He, counsel for the Plaintiffs had suggested to you that nowhere in this picture can you actually see the propose MRT line 2 station. Now I just want to seek your explanation as to how come image like this doesn’t actually have the full picture, cannot see the MRT line 2 and all that can you explain a little bit. DW1: This is just impression photo. [31] Also, it was written clearly in the said SPA that the Plaintiffs agree that they have not purchased the Property based upon or under any representations statement warranty or condition by the agent of the 1st Defendant. S/N XckdttdA0yQlJtEo9IJeQ Clause 7.1 “7.1 The said Property is sold in its present state and condition and the Purchaser shall be deemed to have inspected the said Property and are satisfied with an accept the said Property in every aspect. The Purchaser hereby further agrees that it has not purchased the Property based upon or pursuant to any representation statement warranty or condition whatsoever made to the Purchaser and the Purchaser shall not be entitled to rescind this Agreement or make any claim for damages, compensation or reduction of the Purchase Price in respect of the condition, specifications, measurement, area or state of the Property.” [32] Moreover, the Plaintiffs had already acknowledged that no promises were made in relation to this purchase other than those expressly stated in the said SPA. This is based on a letter by the 1st Defendant dated 05.04.2017 where it states, in essence – “Please not that all the terms and conditions of your purchase and any such promises made by the agent relating to this purchase shall exhaustively set out in the Sale and Purchase Agreement. As such, if there are any promises made by the agent without our knowledge and not expressly stated in the SPA, we shall not be held liability or responsibility, By signing and accepting the content herein, you agree that there are no promises made in relation to this purchase other than those expressly stated in the SPA.” [33] The Plaintiffs also had admitted this fact in his testimony during cross-examination by the 1st Defendant’s counsel. [NOP at page 51] Second paragraph goes on to say, please note that all the terms and conditions of your purchase and any such promises made by the agent relating to this purchase shall be exhaustively set out in the sale and purchase agreement. Agreed? PW1: Agreed. It goes on to say as such if there any promises made by the agent without out knowledge and not expressly state4d in the SPA which shall not be S/N XckdttdA0yQlJtEo9IJeQ held liable and you shall henceforth release us from any such liability or responsibility. Agreed? And then you go on to say be signing and accepting the contents herein you agree that there are no promises made in relation to this purchase other than those expressly stated in the SPA correct? PW1: As it states yes. And you have signed on this document under acknowledgement and acceptance at the bottom of the page correct? PW1: Correct. Now you will agree with me that nowhere in the sale and purchase agreement has it been set out that you are going to be given an unimpeded view or that there is going to be no MRT Line 2 at the back of your property no such representations have been made in the sale and purchase agreement. You would agree with me? PW1: in S&P yes. [34] During the trial, the Plaintiffs never tendered or provided this Court with any documentary evidence to support such representation other than the brochure which stated in it the phrase “proposed MRT line 2 Station 33”. This has made the Plaintiffs’ contention that there was no mention about the construction of the MRT line implausible. [35] Besides, no evidence has been tendered to show/ establish the heart of the entire case: the impeded view. If the view is not impeded, there is nothing false in such representation (if at all) made. PW1 admitted this during cross-examination by the 1st Defendant’s counsel – [Notes of Proceedings (NOP) at page 16] Do you have any pictures that are before the Court today which shows you the state of the view that you had the alleged unimpeded view that you had from your balcony before the purchase and the current state of affairs where you claim that there is an impeded view. Do you have any pictures for the purposed of contrasting the two situations before the Court today? S/N XckdttdA0yQlJtEo9IJeQ PW1: No I don’t. [36] Here, I find shortcoming in the Plaintiffs’ claim. The core of this Claim was that the Plaintiffs’ view was impeded because of the said MRT 2 Line. This Court cannot merely take the words of PW1 that the view is impeded without any proof. As pointed out by the learned counsel of the 1st Defendant, there is not even a shred of cogent evidence that there was an impeded view from the said Property to establish the Plaintiffs case. [37] To support, the 1st Defendant cited the Federal Court case of Admiral Cove Development Sdn Bhd v Balakrishnan a/l Devaraj & Anor [2011] 5 MLJ 309. The facts of this case are pretty similar to the present case where the respondent claimed that there was a misrepresentation by the appellant as the property was not as presented in the brochure. The respondent also contended for rescission of the sale and purchase agreement. It was held by His Lordship Mohd Ghazali FCJ that the property did not differ so completely in substance from what the respondents intended to acquire and as listed under the brochure. [38] His Lordship in delivering the judgment said at p. 323 para [25] – [26]: “[25] … We are of the unanimous view that the Court of Appeal did not properly appreciate the facts and the applicable law when it set aside the decision of the learned judicial commissioner. If at all the appellants had represented that the respondents ‘will be able to swim directly upon exiting the said unit’ as claimed by them, we are of the view that this would be a situation where a statement was made which did not amount to a promise. Such as statement is often treated as being ‘outside’ the contract. [26] There is a flaw in the conclusion of facts and on the law reached by the Court of Appeal. The Court of Appeal failed to appreciate the rescission of a contract after execution cannot be had for mere innocent misrepresentation unless it renders the subject of the sale different from what was contracted for. It further failed to note that the property did not differ so completely in substance from what the respondents intended to acquire.” [Emphasis added.] S/N XckdttdA0yQlJtEo9IJeQ [39] In our case, I could not find any proof to suggest or establish that the said Property was in worldly differ from what had been stated under the brochure or the representation (if at all). Unless there was evidence (such as a photo or even satellite image) which the Plaintiffs have failed to do tender, this Court is of the opinion that this Claim is unsustainable. To begin with, this Court cannot figure out the distance of the MRT line behind the said Property. Also, without any visual image, the key issue about how far such MRT line could impede the view from the said Property remains unanswered. [40] I am also guided by the Federal Court case of Letchumanan Chettiar Alagappan @ L Allagappan (as executor to SL Alemeloo Achi alias Sona Lena Alamelo Acho, deceased) & Anor v Secure Plantation Sdn Bhd [2017] 4 MLJ 697 where His Lordship Jeffrey Tan FCJ in delivering the judgment reasoned that at pp. 740 - 741, para [57] – [60]: “[57] The rule is that ‘the onus of proof of any particular fact lies on the party who alleges it, not on him who denies it; et incumbit probation qui decit, non qui negat, Actori incibit probation … The plaintiff is bound in the first instance, to show a prima facie case, and if he leaves it imperfect, the court will not assist him. Hence, the maxim Potior est condition defendantis. A plaintiff cannot obviously advantage himself by the weakness of the defence. A plaintiff’s case must stand or fall upon the evidence adduced by him. When, however, the defendant, or either litigant party, instead of denying what is alleged against him, relies on some new matter which, if true, is an answer to it, the burden of proof changes sides; and he, in his turn, is bound to show a prima facie case at least and, if he leaves it imperfect, the court will not assist him. Reus excipendo fit actor’ (Woodroffe and Amir Ali, Vol 3 at pp 3190-3191). [58] ‘The party on whom the onus probandi lies … must begin’ (Woodroffe and Amir Ali, Vol 3 at p 3192). ‘The strict meaning of the term onus probandi is this; that if no evidence is given by the party on whom the burden is cast, the issue must be found against him’ (Woodroffe and Amir Ali, Vol 3 at p 3189). ‘The principle that the party who asserts the affirmative in any controversy ought to prove his assertion, and that he who only denies an allegation may rest on his denial, until, at least, the probable truth of the S/N XckdttdA0yQlJtEo9IJeQ matter asserted has been established, is one which has received the widest recognition. The reason is obvious: to all propositions, which are neither the subject of intuitive or sensitive knowledge or probabilised by experience, the mind suspends its assent until proof of them is adduced or as it has been said: ‘Words are but the expression of fact; and therefore, when nothing can be said to be proved’; which is found is probably what is meant by the maxim per rerum naturam, factum negantis probation nulla est’ (Woodroffe and Amir Ali, Vol 3 at pp 3190-3191). … [60] It would pan out that the respondent, who was the plaintiff, had both the ‘burden of proof’ to make out a prima facie case as well as the initial onus of proof to adduce evidence to prove the claim. The onus of proof would only shift to the appellants if the respondent had made out a prima facie case…” [Emphasis added]. [41] Rather than contending on the contents of the 1st Defendant’s letter in reply dated 06.08.2018, the Plaintiffs should have (but failed to) led evidence to prove that they suffered such impeded view on the said Property. Thus, even if I were to be minded to agree with the Plaintiffs that there was indeed such a representation, the burden is also on the Plaintiffs to show to this Court that this representation is not true (hence, a false representation). Then only their case of misrepresentation can be established. However, nothing has been tendered to show such impeded view but for bare allegation by the Plaintiffs. The Plaintiffs thus have failed to prove their case on the balance of probabilities. To quote the Federal Court in Admiral Cove Development (supra) (at p. 315 para [9] – [10]), “[9] After full trial in the High Court, the learned judicial commissioner ruled that there was no actionable misrepresentation and hence dismissed the respondents’ claim. She found that on the evidence adduced before her, the representation was not made out and, in any case, did not induce the respondents to enter into the agreement. She also held that as the contract has been completed, the court could not order rescission. S/N XckdttdA0yQlJtEo9IJeQ [42] Therefore, in answering the first issue, it is my finding that the Plaintiffs have failed to prove to this Court that the 1st Defendant made such false misrepresentation regarding the unimpeded view of the said Property. II. The Representation on the Payment of the Differential Sum [43] The Plaintiffs contended that the 1st Defendant had misrepresented to the 2nd Defendant that the Plaintiffs had paid the differential sum to the 1st Defendant. This alleged misrepresentation has caused the 2nd Defendant releasing the balance purchase price of RM1,720,600.00 to the 1st Defendant. With due respect, I find no basis for this allegation. It was a fact which was readily admitted by PW1 that the Plaintiffs had entered into the Deferred Payment Scheme with the 1st Defendant: [NOP at page 24, PW1’s testimony during cross-examination by the 1st Defendant’s counsel] Now you agree with me that the first payment, sorry before I go to that I want you just turn to page 50 for a quick second. Just a few pages onwards. That document that we were looking at the differed payment scheme that you and the 2nd Plaintiff both signed on was actually signed on the date where you actually made the 3rd appointment. I think it was 5th April. That’s where the differed payment was signed correct? PW1 I am not sure. Let’s look back at the document then go back to page 45 for a while. Look at the top of the page 5th April 2017. You agree this is the date when both of you and the 2nd Plaintiff signed on it dated 5th April 2017. It’s also down there at the signature section. PW1: Yes So on 5th April 2017 you signed up for his differed payment scheme and agreed to the terms and conditions stated in that particular document that you’ve just been referred to agreed? PW1: Agreed. [44] It was provided under the Deferred Payment Scheme that the Plaintiffs would make 3 separate payments to the 1st Defendant to settle the differential sum. DW3 greatly explained this during her re-examination: [NOP at pages 159 – 160] S/N XckdttdA0yQlJtEo9IJeQ In this situation that we have today did the purchaser actually pay you any differential sum? DW3: The purchaser pays us by post-dated cheque So when the purchaser paid you by post dated cheques was this an offer made to the purchaser or how did it come about this particular scheme that you are talking about. You mention that deferred payment scheme you can elaborate now what you mean by the deferred payment how it works and how the contra credit note relate to the deferred payment scheme in light of the statement of account at page 73 that Yang Arif just refer to you. Please try untying all of that into your answer. DW3: This is the promotion scheme we have here is the deferred payment so the purchaser has accepted this the deferred payment scheme and then with this deferred payment scheme is actually we called it differential sum but it actually now converted to deferred payment right. So once is converted to deferred payment so the differential sum is deemed paid. So, this deferred payment is paid to us by 3 post dated cheques. So that is why when the post-dated cheque that is a deal when the PD cheque is due then we will bank in the cheque accordingly. So when the 1st Defendant wrote to the bank 2nd Defendant in this case to confirm that the difference between the purchase price and loan has been paid to confirm that the purchasers settled the difference between the loan amount and particular, in your mind is that a form of misrepresentation? Do you think that is misrepresenting the bank? DW3: No. [45] Thus, I agree with the 1st Defendant’s argument that there was never a misrepresentation regarding the differential sum as (1) the representation was not even addressed to the Plaintiffs and (2) the said SPA had already been executed, thus the element for inducement is non-existent. Besides, as aptly stated by His Lordship Gopal Sri Ram JCA (as he then was) in Sim Thong Realty (supra), one of the elements of an actionable misrepresentation case is that the representation ‘must be addressed to the party misled.’ It is crucial that the claimant himself must be the addressee of the representation. Here, the confirmation was given by the 1st Defendant to the 2nd Defendant. Thus, it has not misled the Plaintiffs in anyway. S/N XckdttdA0yQlJtEo9IJeQ Hence, I find that the Plaintiffs have failed to establish their claim regarding the differential sum. III. Remedies [46] It is clear that the Plaintiffs’ claim under misrepresentation has failed. However, for completeness of discussion, I will now discuss whether the Plaintiffs are entitled for rescission of the said SPA if it was found that there was such misrepresentation. [47] The learned counsel of the 1st Defendant had punched holes in the Plaintiffs’ claim for rescission. Firstly, the Plaintiffs had failed to specifically plead as to whether there is any fraud or negligence regarding the misrepresentation. And according to Sim Thong Realty (supra), if one were unable to specifically plead either fraud or negligence with regards to their misrepresentation, it is deemed to claim as innocent misrepresentation. His Lordship Gopal Sri Ram JCA (as he then was) says this at p. 471 para G: “It is clear that the defendant’s pleaded case alleges neither fraud nor negligence. All that the defendant has pleaded is the misrepresentation about the access to the land. Absent a specific and particularized plea of fraud or negligence, the defendant must be taken as asserting a case of innocent misrepresentation in the sense already discussed.” [Emphasis added.] [48] In our case, I do agree with the 1st Defendant’s contention that since the Plaintiffs have not specifically pleaded what type of misrepresentation they were claiming, it is trite for this Court to take it as an innocent misrepresentation. For such innocent misrepresentation, if I am minded to allow the Plaintiffs’ claim (which I do not), can the Plaintiffs rescind the said SPA? [49] The Plaintiffs argued that as the said SPA remains executory, the remedy of rescission is available. With all due respect, I again disagree. This Court find great guidance in Admiral Cove Development (supra). It was held that a sale and purchase agreement is completed when the purchaser received an executed conveyance and made payment for the purchase price. In such situation, the rescission of the contract cannot be ordered for a mere innocent misrepresentation: S/N XckdttdA0yQlJtEo9IJeQ “[23] In the instant appeal, it is a case of a contract for the purchase and sale of property and the contract was completed when the purchaser, i.e., the respondents received an executed conveyance and made payment for the purchase price. Since the conveyance has been properly executed by both the appellant and the respondents, we do not think that the latter can recover the purchase monies. Further, there was a delay of more than four years before the respondents decided to pursue the action for rescission. A case on point which regard to delay, is Leaf v International Gallaries [1950] 2 KB 86. The facts of the case were that in March, 1944, the buyer brought from the sellers an oil painting of Salisbury Cathedral which was represented to him as a painting by Constable, a representation which was held to be one of the terms of the contract. In 1949 he found that the picture was not a Constable. The buyer then claimed for the rescission of the contract on the ground that there had been an innocent misrepresentation. The court held that the claim was not competent because the buyer had lost the right to reject on the ground that there was a give years delay when he claimed for the rescission and that was unreasonable… [24] We are of a similar view. We would agree that delay in pursuing an action for the rescission of a contract could be fatal. More importantly, the above judgment of Jenkins LJ pointed out that so far as dealings on land are concerned, there is a considerable body of authority to the effect that rescission on the ground of innocent misrepresentation will not be allowed after conveyance. In Wilde and Another v Gibson [1843-60] All ER Rep 494, a case which was referred to by Jenkins LJ in his judgment when making reference to sales of land, Lord Campbell said (at p 502): If there be, in any way whatever, misrepresentation or concealment which is material to the purchaser, a court of equity will not compel him to complete the purchase, but where the conveyance has been executed, I apprehend, my Lords, that a court of equity will set aside the conveyance only on the ground of actual fraud. There would be no safety for the transactions of mankind if, upon discovery being made at any time distance of time of a material fact not disclosed to the purchaser of which the vendor had merely constructive notice, a conveyance which had been executed could be set side. (Emphasis added) S/N XckdttdA0yQlJtEo9IJeQ [25] …We are of the unanimous view that the Court of Appeal did not properly appreciate the facts and the applicable law when it set aside the decision of the learned judicial commissioner. If at all the appellant had represented that the respondents ‘will be able to swim directly upon exiting the said unit’ as claimed by them, we are of the view that this would be a situation where a statement was made which did not amount to a promise. Such a statement is often treated as being ‘outside’ the contract. [26] There is a flaw in the conclusion of facts and the law reached by the Court of Appeal. The Court of Appeal failed to appreciate that rescission of a contract after execution cannot be had for mere innocent misrepresentation unless it renders the subject of the sale different from what was contracted for. It further failed to note that the property did not differ so completely in substance from what the respondents intended to acquire. [27] We do not think that the sale and purchase agreement for the property in the instant appeal can be set aside for innocent misrepresentation after it has been completed be conveyance and payment of the purchase money. On the part of the appellant as vendor, it had conveyed the property with a good title and has delivered up actual possession or enjoyment thereof. The respondents as purchasers had accepted the conveyance of the property by taking possession and paying the price. Innocent misrepresentation is no ground for setting aside and executed contract. What has been performed is what was agreed to be performed.” [Emphasis added] [50] Applying the same principle in the present case, it is evident that the facts and evidence show that the Plaintiffs cannot seek from this Court the relief of rescission of the said SPA for a mere innocent misrepresentation. The Plaintiffs’ whole claim was based on an innocent misrepresentation made by the 1st Defendant’s agent, that there would be an unimpeded view from the balcony of the said Property. [51] Moreover, the said SPA had already appropriately been executed as the title deed of the said Property and notice of delivery of vacant possession dated 13.06.2018 had already been given to the Plaintiffs pending the Plaintiffs’ settlement of their outstanding under the Deferred Payment Scheme. PW1 himself, during cross-examination [NOP Vol.1, p.37, lines 1-4], has acknowledged that he has received the S/N XckdttdA0yQlJtEo9IJeQ letter from the 1st Defendant informing the delivery of the vacant possession of the said Property to the Plaintiffs. [52] It is clear to me that the vacant possession has already been delivered to the Plaintiffs in accordance with the SPA. Their failure to make payments for the balance due under the Deferred Payment Scheme and collect the keys to the said Property is their own action and is to their own peril. Thus, the Plaintiffs cannot allege that the said SPA had not been properly executed. Not to mention, there was a delay on the part of the Plaintiffs sending the Notice of Rescission to the 1st Defendant after the purported discovery of the MRT 2 line in May 2018. The Notice of Rescission was only sent to the 1st Defendant on 08.03.2019. No explanation has been forwarded for the 10 months delay. Rescission is therefore no more available to the Plaintiffs. [53] Therefore, on all counts, the Plaintiffs’ case is untenable. IV. The 1st Defendant’s Counterclaim [54] The 1st Defendant’s counterclaim is essentially derived from the Deferred Payment Scheme as explained previously. DW3’s witness statement explained the essence of this Deferred Payment Scheme: [DW3’s Q&A8] Q8: Can you explain the deferred payment scheme signed up by the Plaintiffs and its application to the differential sum of the Property? A8: The deferred payment scheme signed up by the Plaintiffs allows them to pay their differential sum up to 10% of the purchase price by way of 3 post-dated cheques with 3 months interval for a period of 9 months from their booking date. Under the deferred payment scheme, the differential sum payable by the Plaintiffs would be divided into balance purchase price of RM27,600.00 and 10% deferred payment of RM234,880.00 which is computed as follows: - S/N XckdttdA0yQlJtEo9IJeQ [55] As testified by PW1 during cross-examination, The Plaintiffs were well aware of how the Deferred Payment Scheme worked: [NOP at pages 22 – 23] Now you would agree with me that his differential sum, we were call it a differential sum. The sum that you just refer to being mentioned in the letters at page 1 and 2 and 3. This sum which I were called differential sum would you agree with me at least that you had entered into a differed payment scheme with the 1st Defendant for the payment of the sum? PW1: Agree. Now let’s take a look at the document. Look at Bundle A again, part B page 45. So you agree that the loan sum at least let’s look at the contents of this document the loan sum which is valued at about 73.48% of the purchase price amounts to a sum of RM1,726,000.00 correct? PW1: Correct. Therefore the additional sum you would have to pay after the loan would be 26.52& which is the sum of RM622,800.00 correct? PW1: Correct You had a payment for under the booking for RM8,000.00 agreed? PW1: Agreed. There was also 10% rebate that the 1st Defendant offered you which amounts RM234,880.00 correct? S/N XckdttdA0yQlJtEo9IJeQ PW1: Yes . And now those additional 5% rebate that was given to you amounting to RM117,440.00 because you actually signed the Sale and Purchase Agreement within 21 days from the booking fee payment agreed/ PW1: Agree. So the differential sum that you required to pay the 1st Defendant was RM262,480.00 correct? PW1: Correct. Now you will agree that under this deferred payment scheme the developer was offering deferred payment of amounting to 10% of the value of the purchase price. Agreed based on this document> PW1: Agree And that sum that is equivalent to 10% of the purchase price amounts to RM234,880.00. Agree? PW1: Agree. Therefore you would have to pay a sum of only RM27,600.00 first. Correct? Because there is still a short of RM27,600.00 because please bear in mind that differential sum was RM262,000.00. Agree? PW1: Agree. Now there is no issue you can confirm to Court the due date in fact pay the RM27,600.00 agree? PW1: Agree. So, the only issue is now the RM234,880.00 deferred payment amounting 10% of the purchase price. Now let’s look at the payment schedule, you agree that this payments schedule that you had accepted that you would provide 3 post date cheques date on is 3 months from the, 3 months from the booking date amounting to RM78,294.00. Second one is 6 months from the booking date amounting to RM78,294.00 and the third cheque post dated cheque be 9 months from the date of the booking fee amounting to RM78,292.00. Agree? PW1: Agree. S/N XckdttdA0yQlJtEo9IJeQ [56] Nonetheless, the Plaintiffs had failed to fulfil their obligation under the Deferred Payment Scheme. PW1 admitted this failure at trial. PW1 during cross-examination had already admitted their inability to settle the payments. [NOP at page 27] Is there anything, before the Court today we only looking at documents before the Court today, nothing before the Court thank you. Now it is a fact that the 1st post dated cheque was cleared isn’t so you did settled the first post dated cheque without any issue. PW1: With the help of IOI from my EPF. The second post dated cheque for the exact same value as the first one. That did not clear isn’t? It bounced. PW1: That is correct. And after that cheque bounced, the 1st Defendant actually wrote to you on 3 occasions telling you that the cheque has bounced please send us a replacement cheque, do you agree? 3 different letters that were sent to you? PW1: Agree. And what you did at that point was? You informed the 1st Defendant that okay I will pay you, I’ll provide you with a new cheque but I will only be able to clear the said sum by the end of December of that year. Do you agree? PW1: Disagree. [57] In fact, the Plaintiffs, through PW1’s email to the 1st Defendant at pp. 69 – 70 of the Common Bundle of Document (B) Vol. A (Enclosure 15), had requested a new payment plan. During cross-examination, PW1 also acknowledged his failure to pay: [NOP at page 35] And you in fact had not objection to this because you responded to that email on 9th April saying that, Dear Ms Chin as part of effort to pay to pay of the outstanding I am able to make the monthly RM5,000.00 payment via a secured credit card Citibank. You have no objections to the interest charges. PW1: Because they did say that it will be waive settlement is done. But there was no settlement eventually isn’t? S/N XckdttdA0yQlJtEo9IJeQ Now I am putting it to you that the first two payments cleared after that the RM6,000.00 payment in April 2018 and the RM5,000.00 payment in May 2018. Thereafter you failed to make any further payments agreed? PW1: Agreed. [58] Similarly, the Plaintiffs also have failed to settle the invoice issued by the 1st Defendant dated 25.09.2017 for the assessment and quit rent for the said Property. Consequently, the evidence before this Court is overwhelming that the Plaintiffs had failed to pay the outstanding sum and the outgoings as claimed by the 1st Defendant. And, based on the above testimonies, it was already admitted and acknowledged by PW1 himself. The 1st Defendant further cited the Federal Court decision, to which I agree and am bound, in He-Con Sdn Bhd v Bulyah bt Ishak & Anor (as administrators for the estate of Nor Zainir bin Rahman, the deceased) and another appeal [2020] 4 MLJ 662 where His Lordship Abang Iskandar FCJ held (at p. 694 para [68]): “[68] Likewise, in this case immediately before us, the issue of the non-conclusion of P1 was never pleaded in the first defendant’s SOD, and even if it was pleaded, it was not pleaded sufficiently. In terms of evidence, there was nothing coming from the first defendant that shown eagerness on its part to drive home this purported issue to the front. The liquidator never testified to that as an affirmative fact, and neither was it put to the lawyer SP1 that such was the first defendant’s case vis a vis P1 during his cross examination. Failure to properly cross-examine a witness of the adverse party means there is an admission to the fact advanced by the adverse party (see Browne v Dunn [1893] 6 R 67 and AEG Carapiet v AY Derderian AIR 1961 Cal 359 as examples)” [59] Therefore, this Court allow the 1st Defendant’s counterclaim against the Plaintiffs. V. The 2nd Defendant’s Counterclaim [60] Before I venture further into the discussion, it is pertinent to note that, as agreed by the parties, the Plaintiffs’ misrepresentation claim has nothing to do with the 2nd S/N XckdttdA0yQlJtEo9IJeQ Defendant. Thus, I will only focus on the 2nd Defendant’s counterclaim against the Plaintiffs. [61] The 2nd Defendant was the registered chargee for the said Property at all material time. In essence, the 2nd Defendant had claimed that the Plaintiffs had failed to make the necessary monthly instalments under the Loan Facilities. Clause 7.1 of the Loan Facilities Agreement states: Clause 7.1 Repayment “Regardless of whatever stated, mentioned or implied elsewhere is this Agreement or any Letter of Offer, each Facility is repayable to the Bank on demand. The Borrower must therefore immediately on demand by the Bank, pay to the Bank all moneys and liabilities whatsoever (principal, interest and otherwise, actual and contingent) owing or payable to the Bank under that Facility. Until such demand by the Bank, the Borrower must repay and pay the moneys and liabilities owing or payable to the Bank under the Facility in the manner and at the times set out or mentioned in the relevant Letter of Offer and this Agreement.” [62] During the trial, PW1 had admitted there was a failure on the part of the Plaintiffs to pay the sum demanded under the notice of demand: [NOP at page 48, PW1’s cross-examination by the 2nd Defendant’s counsel] So, since you have agreed to the terms of the facility agreement, the letter of offer and also the charge document. I put it to you, you are bound by the terms. PW1: Agree. Since you are bound by the terms and conditions of the letter of offer, the facility agreement and the charge document, I put it to you that the bank now is entitle to enforce its right and remedies under that document, under the security document. PW1: Agree I want to refer you to page 28 until 30 of the Bundle B which is in part B also. So I put it to you that you have failed to remedies or to pay the sum demanded by under this letter of demand? PW1: Agreed. S/N XckdttdA0yQlJtEo9IJeQ [63] Yet, the Plaintiffs contended the 2nd Defendant’s claim against the Plaintiffs was wrong in law and its legal rights were not affected by the judgment of this Claim. I have to differ with the Plaintiffs’ counsel on this. This is because the 2nd Defendant had already been added by this Court earlier, on application, to be a co-defendant in this Claim. Thus, I do not see any issue for the 2nd Defendant to file a counterclaim against the Plaintiffs. [64] It is also an agreed fact that the 2nd Defendant had obtained an order for sale in Shah Alam High Court against the Plaintiffs. On top of that, the Plaintiffs also argued that the 2nd Defendant is under duty to mitigate its losses. The 2nd Defendant cannot seek the remedies as provided under section 74 of the Contracts Act 1950. The Plaintiffs contended that the 2nd Defendant cannot claim from the Plaintiffs without first acting on the order for sale that had already been granted in Shah Alam High Court. [65] Again, I have to disagree with the learned Plaintiffs’ counsel. The 2nd Defendant accentuated the Supreme Court case of Bank Bumiputra Malaysia Bhd v. Esah Binti Abdul Ghani [1986] 1 MLJ 16 (at pp. 17 – 18, para H-F) to refute this: “…On this point, Paget on Banking, 8th edition, page 618 has this to say: “… The real question was whether Duncan, Fox & Co. as indorsers were entitled to the same rights as sureties on paying the bills; and save for the words of Lord Watson quoted above, there is nothing in the judgments to support the proposition that a surety can decline to pay till the creditor has exhausted securities placed in his hands by the principal debtor. On the contrary, the right to sue the guarantor without resorting to the securities is clearly recognised by Lord Selborne, and by Lord Blackburn, in the Scottish case of Ewart v. Latta. Lord Westbury, C. says: ‘Until the debtor has discharged himself of his liability, until he has fulfilled his own contract, he has no right to dictate any terms, to prescribe any duty, or to make any demand on his creditor. The creditor must be left in possession of the whole of the remedies which the original contract gave him, and he must be left unfettered and at liberty to exhaust those remedies, and he cannot be required to put any limitation upon the course of legal action S/N XckdttdA0yQlJtEo9IJeQ given by him by his contract by any person who is still his debtor, except upon the terms of that debt being completely satisfied.’ … Halsbury’s Laws of England, Volume 20, 4th edition, paragraph 159 at page 87 states: “…It is not necessary for the creditor, before proceeding against the surety, to request the principal debtor to pay, or to sue him, although solvent, unless this is rendered essential by the terms of the guarantee, nor to resort to securities for the guaranteed debt received by the creditor from the principal debtor, although, in certain special circumstances, it may be necessary for the creditor, before having recourse to the surety, to seek indemnity from a third person.” [66] Also, in the case of Kandiah Peter v Public Bank Bhd [1994] 1 MLJ 119 where His Lordship Eusoff Chin SCJ (at p. 122, para B – D) held that: “The principles governing the matter are well settled by authority and are not open to question. A charge who makes an application for an order for sale in foreclosure proceedings under s 256 of the Code does not commence an action. He merely enforces his rights as a chargee by exercising his statutory remedy against the charger in default. The charge, therefore, does not sue for a debt. It is also clear that his claim for an order for sale is not based upon a covenant but under the registered charge. The order for sale when made under s 256 of the Code is not a judgment or a decree. The court hearing the application for foreclosure does not make, and in any event ought not to make, any adjudication upon any substantive issue. These principles are called from several decisions of our courts which have correctly stated the law upon the subject.” [Emphasis added.] [67] Similarly, in the Court of Appeal case of Public Bank Berhad v Lee Bak Soon @ Lee Pak Choon & Ors [2008] MLJU 766 where Her Ladyship Zaleha Zahari JCA (as she then was) concurred with the decision in Kandiah Peter (supra) and held that – “On the allegation that the institution of the civil proceedings being premature and must await the actual sale of the charged properties, I am of the following S/N XckdttdA0yQlJtEo9IJeQ view. The point of time where all material facts are said to be in existence to render the cause of action complete would be when the Respondents defaulted in making payment upon demand. Upon default, a chargee clearly has two remedies. They can sue the debtor upon his covenant to pay, or they can take proceedings to enforce their security under the National Land Code. The Code confers a special statutory right on the chargee to obtain an order for sale. It is settled law that this statutory right of the chargee is independent of any other causes of action which the chargee may have against the chargor under the charge, or under any law. The action brought by the chargee, and the adjudication of it by the courts, are different to that when other causes of action are instituted by the chargee. By exercising their statutory remedy against the charger in default, the chargee, does not sue for a debt. [See Kanadiah Peter (supra)]. It is an action to enforce the security as distinct from an action on the covenant to pay the debt.” [68] Besides, the argument also arose between the parties regarding the right of the 2nd Defendant to enforce its rights concurrently. To answer this, I must first refer to the relevant loan documentation. It is clearly stipulated in the loan agreement (Additional

Common Bundle of Documents (‘ACBOD’), page 41) – 3 Concurrent exercise or enforcement of rights or remedies The Bank is and will be entitled to concurrently exercise of enforce all its rights and remedies under the Security Documents or by operation of law. The Bank is not obliged to first exercise or enforce or exhaust any right or remedy under any Security Document or by operation of law before exercising or enforcing any other right or remedy available to it under that Security Document or any other Security Document or by operation of law. [69]

Meanwhile, the memorandum of charge (at ACBOD, page 113) says, 1 Concurrent Enforcement The Bank is and will be entitled, immediately upon or at any time after any Event of Default occurs or arises, to concurrently exercise or enforce all the rights, remedies, securities and guarantees which the Bank may have from or against the Borrower, the Chargor and any other sureties, guarantors and other persons for or in respect of all or any or any part of the Secured Liabilities, and is not obliged before taking any steps to exercise or enforce any of its rights, powers or remedies under or in relation to this Charge:

To first sue or commence any legal proceedings or obtain any judgment against the Borrower or the Chargor or any surety, guarantor or other person in any court; or

To first exercise or enforce any other right, power or remedy, or realise or enforce any other security or guarantee, which the Bank may have from or against the Borrower or the Chargor or any surety or guarantor or the person for or in respect of all or any or any part of the Secure Liabilities; or

Otherwise to first exhaust any of its rights or remedies against the Borrower or any surety, guarantor or other person for the recovery of all or any or any part of the Secured Liabilities. [70] It is therefore obvious that, as in the standard banking documents, the 2nd Defendant has the right to enforce its remedies concurrently. The law on this is also trite. I shall quote here few leading authorities on this. In China and South Sea Bank Ltd v Tan Soon Gin (alias George Tan) [1989] 3 All ER 839; [1990] 1 AC 536, it was held by the Privy Council at p. 842: “…The creditor had three sources of repayment. The creditor could sue the debtor, sell the mortgage securities or sue the surety. All these remedies could be exercised at any time or times simultaneously or contemporaneously or successively or not at all. If the creditor chose to sue the surety and not pursue any other remedy, the creditor on being paid in full was bound to assign the mortgage securities to the surety. If the creditor chose to exercise his power of sale over the mortgage security he must sell for the current market value but the creditor must decide in his own interest if and when he should sell…” [Emphasis added] [71] Likewise, in Low Lee Lian v Ban Hin Lee Bank Bhd [1997] 2 CLJ 36, the borrower had defaulted and following an application by the respondent to enforce the charge, the Court ordered that the land be sold. His Lordship Gopal Sri Ram JCA (as he then was) at p. 56 held that: “Now, it is trite that a chargee/creditor may pursue any or all remedies to recover monies lent by him. He may enforce his statutory charge against the chargor by way of proceedings in rem under s.256 of the Code. He may sue the principal debtor (who may or may not be the chargor) upon the personal covenant contained in any loan agreement that was entered into between the parties. He may proceed against the surety who has guaranteed the loan. And he may S/N XckdttdA0yQlJtEo9IJeQ pursue all of these courses simultaneously, contemporaneously or successively. See, China and South Sea Bank Ltd. V. Tan [1989] 3 All ER 839, 842.” [Emphasis added] [72] The apex court has also deliberated this in Chan Boi Loi v Public Bank Bhd and another application [2011] 1 MLJ 478. The appellant there argued that the respondent bank had to take foreclosure proceedings to have the lands sold off first before enforcing the appellant’s promise to repay the loan. His Lordship Gopal Sir Ram FCJ held at p 484: “[8] We would reiterate that a lender is entitled to pursue all remedies available against a borrower simultaneously, contemporaneously, or successively to recover the money lent unless there is an agreement to the contrary.” [Emphasis added] [73] Therefore, even though the 2nd Defendant has commenced the proceeding for the order for sale, it does not mean that the 2nd Defendant could not sue the Plaintiffs for the outstanding sum under the Loan Facilities. The 2nd Defendant has the right to exercise its right under the National Land Code and, simultaneously and concurrently, perusing legal action for any remedy due to the default of the Loan Facilities. [74] Thus, referring to the above authorities, it is a trite law that the 2nd Defendant being the chargee has two types of remedies for its disposal. It may choose to enforce them either consecutively or concurrently. I thus allow the 2nd Defendant’s counterclaim. E. Conclusion [75] To conclude, on the totality of the evidence, this Court find that the Plaintiffs failed to prove to this Court on the balance of probabilities that the 1st Defendant had made a misrepresentation for the unimpeded view from the said Property and that such representation (if at all) is untruth. Both 1st and 2nd Defendants have also established their cases against the Plaintiffs in their respective counterclaims. I, thus, order for this Clam to be dismissed and allow the 1st and 2nd Defendants counterclaims with costs. S/N XckdttdA0yQlJtEo9IJeQ Dated: 21st June 2022 Dr John Lee Kien How @ Mohd Johan Lee Judicial Commissioner High Court Malaya Kuala Lumpur For the Plaintiffs Mugunthan Vadieveloo Messrs Mugu & Sufyan & Co For the 1st Defendant Ankit R Sanghvi and Alycia Chuah Messrs Halim Hong & Quek For the 2nd Defendant KY Sim, Mohd Khairi, Syarifah Dewi Messrs K.Y Sim & Co Table of Authorities Cases Admiral Cove Development Sdn Bhd v Balakrishnan a/l Devaraj & Anor [2011] 5 MLJ 309 Bank Bumiputra Malaysia Bhd v. Esah Binti Abdul Ghani [1986] 1 MLJ 16 Chan Boi Loi v Public Bank Bhd and another application [2011] 1 MLJ 478 China and South Sea Bank Ltd v Tan Soon Gin (alias George Tan) [1989] 3 All ER 839; [1990] 1 AC 536 He-Con Sdn Bhd v Bulyah bt Ishak & Anor (as administrators for the estate of Nor Zainir bin Rahman, the deceased) and another appeal [2020] 4 MLJ 662 Kandiah Peter v Public Bank Bhd [1994] 1 MLJ 119 Letchumanan Chettiar Alagappan @ L Allagappan (as executor to SL Alemeloo Achi alias Sona Lena Alamelo Acho, deceased) & Anor v Secure Plantation Sdn Bhd [2017] 4 MLJ 697 Low Lee Lian v Ban Hin Lee Bank Bhd [1997] 2 CLJ 36 Public Bank Berhad v Lee Bak Soon @ Lee Pak Choon & Ors [2008] MLJU 766 Sim Thong Realty Sdn Bhd v Teh Kim Dar @ Tee Kim [2003] 3 MLJ 460 Wan Salimah Bte Wan Jaffar v Mahmood Bin Omar (Anim Bt Abdul Aziz, Intervener) [1998] 5 MLJ 162 Statutes Section 18, Contracts Act 1950 Section 19, Contracts Act 1950