AFFIN BANK BERHAD v IHAA CAPITAL SDN. BHD. (Dahulunya dikenali sebagai IHAA Holding Sdn. Bhd.) (WA-22NCC-562-08/2024)

The Proposed Intervener filed this notice of application dated 24.9.2025 in Enclosure 28 for the following orders:- (a) the Proposed Intervener be allowed to intervene in the proceedings herein; and (b) for a stay of execution.

On 17.11.2025, I dismissed Enclosure 28. Here are the grounds of my decision. Background facts

At the request of the 1st Defendant, the Plaintiff P granted term loan facilities amounting to RM 15,750,000. The purpose of the term loan was to partly finance the purchase of a single - storey detached factory cum open sided warehouse with an annexed double storey office building situated at property ).

The 2nd to 4th Defendants are the guarantors for the term loan facilities.

As security for the term loan facilities, a first party charge was created over the property in favour of P on 16.8.2023 charge .

On 20.1.2025, summary judgment was obtained against all the Defendants for a sum of RM 15,605,793.34 and RM 200,197.60 respectively. Application to the land administrator for an order for sale

On 1.7.2025, P issued Form 16D pursuant to section 254 of the National Land Code for the purpose of foreclosing the property. Following thereto, an application for an order for sale was filed. The land administrator fixed 11.11.2025 for the enquiry under sections 260 and 261 of the National Land Code.

The Proposed Intervener

The 1st Defendant had entered into a sale and purchase agreement dated 11.10.2022 to purchase the property ( SPA ).

Subsequent thereto, the 1st Defendant and the Proposed Intervener entered into a Declaration of Trust dated 15.11.2022 ( Declaration of Trust ). Wherein it was provided that the 1st Defendant shall hold the property on trust for the Proposed Intervener, and shall deal with the property in accordance with the directions of the Proposed Intervener. The Proposed Intervener says that it possesses an interest in the property arising from the Declaration of Trust.

It is noted however that the Proposed Intervener has not sought any substantive relief in Enclosure 28, save for the prayer to be joined as a party to these proceedings and for a stay of execution. It is also noted that the Declaration of Trust has never been registered in accordance with the applicable legal requirements.

The Proposed Intervener canvassed the following arguments :

it holds an interest in the property, which forms the subject matter of this action;

there exists a valid Declaration of Trust, wherein the 1st Defendant holds the property as trustee on behalf of the

the Proposed Intervener has discharged all financial obligations arising from the acquisition and financing of the property;

the 1st Defendant has breached its fiduciary duties as trustee by defaulting on the loan facilities granted by P, thereby exposing the property to the risk of foreclosure;

the Proposed Intervener ought to be granted leave to intervene to protect its proprietary rights, which are directly and substantially affected by this suit; and

unless leave to intervene is granted and execution stayed, the Proposed Intervener s beneficial ownership of the property will be extinguished. The law on intervener

The law on intervener is encapsulated in Order 15 rule 6 (2) (b) of the Rules of Court 2012. The said provision allows a person who is not originally a party to a proceeding to be joined as a party.

The test for an application to intervene requires the proposed intervener to demonstrate that he possesses a real and direct legal interest in the subject matter of the action, and not merely a commercial interest. Further, that his presence is necessary to effectively and completely adjudicate upon all issues in dispute.

(See the Privy Council decision in Pegang Co Ltd v Choong Sam & Ors [1969] 2 MLJ 52 at 55 - 56; the Supreme Court decision in Tajjul Ariffin bin Mustafa v Heng Cheng Hong [1993] 2 MLJ 143).

I dismissed Enclosure 28 for the following reasons :

Upon the entry of judgment, the proceedings herein are deemed concluded, leaving no basis for the Proposed Intervener to intervene thereafter; and

This suit pertains to a monetary claim against the Defendants arising from their default under the term loan facilities. The Proposed Intervener says that it possesses an interest in the property arising from the Declaration of Trust. However, the proper avenue to assert such a claim would be in the foreclosure proceedings. Alternatively, the Proposed Intervener may institute a separate action seeking a declaration of the Declaration of Trust.

Here is my explanation. Once judgment has been entered, the proceedings are deemed to have been concluded

While Order 15 rule 16 (2) of the Rules of Court 2012 provides that an application to intervene may be made at any stage of the proceedings, it is vital to note that on 20.1.2025, the c lication for summary judgment. Judgment was duly entered against the Defendants.

Once the judgment has been entered on 20.1.2025, the proceedings herein have effectively come to an end. There is nothing left to intervene. Despite this, the Proposed Intervener only filed Enclosure 28 on 24.9.2025, long after the conclusion of this matter.

O , the Federal Court in Hong Leong Bank Bhd (formerly known as Hong Leong Finance Bhd) v Staghorn Sdn Bhd and other appeals [2008] 2 MLJ 622 held as follows :

The words t any stage of the proceedings necessarily mean that there is a proceeding pending. Once the judgment is entered, the proceeding has come to an end. Furthermore, Order 15 is concerned with the very early stage of a proceeding, to have all the necessary parties in before the trial begins. (See paragraph 27 of the judgment).

meaning before judgment, otherwise the proceedings have concluded and there is no longer a proceeding in existence for the party to intervene in. The judge had also become functus officio. (See paragraph 55 of the judgment).

Any party, whether a party in the original proceeding or not, who wants to challenge the order for sale, or for that matter, any judgment, other than a default judgment or where it is specifically provided for in the rules, may only do so by filing a fresh action. (See paragraph 57 of the judgment).

In Fima Bulking Services Bhd & Ors v Kazhou Pte Ltd (Lembaga Minyak Sawit Malaysia, proposed intervener) [2025] MLJU 2632, the High Court opined that applications to intervene must be made while the proceedings remain alive and before final determination. The High Court said : [23] The law is well - settled that after the judgment has been entered, applications to intervene will not be entertained as the proceedings are no longer pending. In Hong Leong Bank Bhd v Staghorn Sdn Bhd (2008) 2 MLJ 622 FC, the Federal Court held that intervention applications must be made while proceedings remain alive and before final determination. Similarly,in Lam Hong HardwareCo Sdn Bhd v Incacon Sdn Bhd & Ors (2006) 4 MLJ 531 CA, the Court of Appeal confirmed that post - judgment intervention defeats the principle of finality in litigation. [24] Allowing intervention after judgment would undermine the legal certainty and the doctrine of res judicata. It would permit endless re - litigation by parties who could have but failed to participate in the original proceedings. The courts have consistently refused to allow parties to intervene post - judgment to avoid creating a precedent that would destabilise the finality of judicial decisions and encourage tactical delays in enforcement.

To sum up, the Proposed Intervener filed Enclosure 28 more than eight months after summary judgment was granted against the Defendants. The proceedings herein have since concluded. There is no longer any subsisting proceeding in which the Proposed Intervener may intervene. The court is, in any event, functus officio. Wrong forum

This suit pertains to a monetary claim against the Defendants arising from their default under the term loan facilities. As the said term loan facilities are secured by a charge, P has initiated an application before the land administrator at the Klang Land Office for an order for sale pursuant to section 260 of the National Land Code.

The Proposed Intervener says that it possesses an interest pursuant to the Declaration of Trust. However, the appropriate forum for the Proposed Intervener to assert its interest is in the order for sale proceedings before the land administrator.

Alternatively, the Proposed Intervener may institute a separate action seeking a declaration of the Declaration of Trust. Indeed, in its affidavit in support filed herein, the Proposed Intervener states its intention to institute proceedings against the 1st Defendant for breach of trust and unjust enrichment.

It is germane , and not an in rem action under the National Land Code. The distinction between the two is significant.

The Federal Court in Low Lee Lian v Ban Hin Lee Bank Bhd [1997] 1 MLJ 77 at 85 - 86 explained : In the present context, an action brought to set aside a charge upon one or more of the grounds of defeasibility specified under s 340 of the Code is an action in rem. For when it succeeds, the consequence is to set at naught the chargee's rights under the registered charge as against the whole world. On the other hand, a chargor who is able to demonstrate that the chargee is under a personal obligation that binds his conscience not to enforce the charge, though not in a position to bring his case within one or more of the exceptions to the indefeasibility provision may nevertheless proceed to enforce that obligation against the chargee. This is an action in personam. The consequences of succeeding in such an action will have the effect of getting the charge to defeat his own title or of depriving him of some or all of his rights under the registered charge, including the right to obtain an order for sale. See Oh Hiam & Ors v Tham Kong [1980] 2 MLJ 159. The important distinction between the enforcement of rights ad rem and rights in personam in the context of the Code was explained by the Court of Appeal in Luggage Distributors (M) Sdn Bhd v Tan Hor Teng & Anor [1995] 1 MLJ 719 at p 758. We accept that what was there said correctly states the law upon the subject : To summarize, a claimant to any title or registrable interest in land may frame his case in one of two actions. If the facts pertaining to his claim enable him to bring his case within those vitiating categories specified under s 340 (2) of the Code, then he may frame his case under one or more of those categories as an action in rem. If on the other hand, he is unable to bring himself squarely within the exceptions in favour of defeasibility, then, all is not lost to him: for, if he is able to constitute his complaints as an action in personam he may achieve the same result. Of course, as an action in personam, his claim may be subjected to all those discretionary considerations that operate in the grant or refusal of specific relief. In either case, he may be entitled to secure the status quo by the entry of a private caveat.

In view of the fact that judgment has already been entered, the appropriate avenue for the Proposed Intervener to seek any relief lies within the foreclosure proceedings, and not by way of intervention in the present suit.

It is important to understand that :

the summary judgment which was obtained against the Defendants; and

the order for sale proceedings undertaken, are distinct and independent proceedings.

This is consistent with the legal principle enunciated by the Court of Appeal in Public Bank Berhad v Lee Bak Soon @ Lee Pak Choon & Ors [2008] MLJU 766 as follows : 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 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 other 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 chargor in default, the chargee, does not sue for a debt [See Kandiah Peter (supra)]. It is an action to enforce the security as distinct from an action on the covenant to pay the debt.

The instant suit is a contractual defaults under the term loan facilities extended by P. The summary judgment obtained herein does not determine any right, title or interest in the property. Nor does it affect any proprietary claim asserted by the Proposed Intervener over the property.

I conclude that the presence of the Proposed Intervener is not necessary for the effectual and complete adjudication of the issues in dispute in this matter. This suit the term loan facilities (action in personam). This action is a monetary claim. It is not founded upon, nor does it concern, the security created by the charge on the property (action in rem). No special circumstances to warrant a stay of execution

T summary judgment is devoid of merit.

The Proposed Intervener relies on the Federal Court decision in Kosma Palm Oil Mill Sdn Bhd & Ors v Koperasi Serbausaha Makmur Bhd [2003] 4 CLJ 1 and the Court of Appeal decision in Ming Ann Holdings Sdn Bhd v Danaharta Urus Sdn Bhd [2002] 3 CLJ 380 to justify its application for a stay of execution of the summary judgment.

Those authorities actually ought not to be granted unless there exist special or exceptional circumstances. The onus lies on the applicant to demonstrate such circumstances by credible affidavit evidence.

In Kosma Palm Oil (supra), the Federal Court held that a successful litigant should not be deprived of the fruits of its judgment, unless there exist special circumstances that are both exceptional and compelling. And that such circumstances must go beyond the ordinary consequences of an unsuccessful party seeking to delay enforcement.

The Federal Court emphasised that special circumstances must be truly special, not ordinary or usual. It must relate to the enforcement of the judgment, rather than to the correctness or merits of that judgment. The Federal Court made clear that mere assertions of hardship, inconvenience or potential prejudice are insufficient to justify the granting of a stay.

Applying those principles to the present case, the Proposed Intervener has failed to demonstrate any special or exceptional circumstances warranting a stay. The affidavit in support of its application merely asserts speculative concerns regarding an interest in the charged property. Such interest is based on an unregistered Declaration of Trust, which is unrelated to the subject matter of this suit.

It bears reiterating that the summary judgment obtained by P is a under the term loan facilities. The claim is purely for sums due and owing under the loan agreements, and has no connection with the charged property or any proprietary interest asserted by the Proposed Intervener over the property.

Civil recovery proceedings culminating from the summary judgment and any subsequent foreclosure proceedings are separate and distinct legal processes. The present suit is concerned solely with establishing the . Whereas the foreclosure proceedings relate to the enforcement of the security over the charged property.

the summary judgment would prejudice its interest in the charged property is misconceived. The enforcement of a monetary judgment by P does not over the charged property. Nor does it engage any question of ownership or possession of the property.

Furthermore, the Proposed Intervener is not a party to this suit and therefore has no locus standi to seek a stay of execution. The Defendants, against whom the summary judgment was obtained, have not themselves sought such relief at the time when Enclosure 28 was filed on 24.9.2025. (Subsequently, the Defendants did file a notice of application dated 12.11.2025 vide Enclosure 40 for a stay of execution). It would be improper to restrain P from enforcing a valid monetary judgment at the instance of a non - party.

I conclude that the Proposed Intervener has failed to discharge the burden of demonstrating any exceptional or special circumstances justifying the stay sought. The grounds advanced by the Proposed Intervener are predicated upon its proprietary interest in the charged p the term loan facilities. Accordingly, there exists no legal or factual basis for the grant of a stay of execution.

Moreover, the execution of the summary judgment does not deprive the Proposed Intervener of an opportunity to assert its interest in the charged property. At the foreclosure proceedings against the charged property, the Proposed Intervener may, in that separate forum, advance any claim it deems fit. The Declaration of Trust

Regarding the Declaration of Trust rights thereunder, P put forward the following arguments.

The Declaration of Trust was never registered in accordance with the provisions of the National Land Code. (See section 344 of the National Land Code; the Court of Appeal case of Low Tin Yong @ Low Yong Lian v Low Ying Thuan [2016] 3 MLJ 332 at 347).

The issue document of title does not reflect that the Proposed Intervener holds the property on trust as a trustee. There is no indication on the title or in the land search on the property to evidence the existence of any trust. Nor has the Declaration of Trust been duly stamped.

Since the Declaration of Trust was never registered, the Proposed Intervener has failed to establish any legal right in the property. At most, the Proposed Intervener may have a commercial or financial interest that does not confer any legal standing in this suit.

on the property prevail over the unregistered Declaration of Trust. The unregistered trust cannot give rise to a legal interest in the property that can take priority over a registered charge. In the absence of any cannot be displaced by any unregistered or equitable interest.

The said trust, executed between the Proposed Intervener and the 1st Defendant, does not involve P. P was neither a party to nor had any knowledge of the purported arrangement.

In contrast, the Proposed Intervener had expressly consented to the creation of the charge and was fully aware of its intended execution over the property. At all material times, the Proposed Intervener had neither raised any objection nor provided any notification to P regarding the existence of any arrangement and the purported trust with the 1st Defendant.

Paragraph 15 of ffidavit in support avers that the Proposed Intervener, by a letter dated 20.12.2022, confirmed that it had no objection to the financing offer extended by P.

The above - mentioned letter from the Proposed Intervener manifest upon the terms and conditions stipulated in the letter of offer dated 9.12.2022. The said letter of offer stipulates that a first - party charge shall be created over the property, thereby the charge.

The Proposed Intervener cannot now be permitted to reprobate and approbate the existence of the charge, having had knowledge that the property is to be charged to P. Having acquiesced to and remained silent regarding the creation of the charge, the Proposed Intervener is estopped from asserting any to intervene and to seek a stay of execution is therefore untenable.

For the purposes of Enclosure 28, I refrain from making any determination o rights under the Declaration of Trust. I think such arguments are best ventilated in the order for sale proceedings, if the Proposed Intervener is minded to intervene in those proceedings. The Proposed I the

additional affidavit dated 3.11.2025 (Enclosure 33), on the grounds that it was filed without leave of court and that its filing is prejudicial. I dismissed the said objection.

The contents of Enclosure 33 are confined to updating the court on the status of the foreclosure proceedings presently pending at the Klang Land Office. It does not introduce any new issues, arguments or evidence that would alter the substance of this matter. Enclosure 33 was filed to assist the court and all parties by providing an update on the progress of the said foreclosure proceedings.

The Proposed Intervener has, in any event, filed an affidavit dated 4.11.2025 in Enclosure 34 responding to the contents of Enclosure 33. This demonstrates that the Proposed Intervener has opportunity to respond and that no element of prejudice has been occasioned. By virtue of Order 1A of the Rules of Court 2012, I shall be guided by the overriding interest of justice and not be unduly constrained by technical non - compliance with procedural requirements.

Further, pursuant to Order 2 rule 3 of the Rules of Court 2012, a preliminary objection premised on non - compliance with the Rules may only be sustained where the court is satisfied that such non - compliance has occasioned a substantial miscarriage of justice, or has caused prejudice which cannot be remedied. I am far from satisfied that such is the case here.

(See the Federal Court case of Upmarket Development Sdn Bhd v Sriera Development Sdn Bhd [2011] 4 MLJ 681 at 691; the Court of Appeal case of Marzaidi bin Mohammad (suing as the guardian / next friend and the litigation representative for Muhammad Muhriz bin Marzaidi) & Anor v Mohamed Affendi bin Khairuddin and another appeal [2025] 4 MLJ 919 at 949). Conclusion

For the reasons above, I dismissed Enclosure 28. I awarded costs of RM 5,000 to P. Dated 9 December 2025 Quay Chew Soon Judge High Court of Kuala Lumpur (Commercial Division NCC 2 & Admiralty 9) Counsels Dir Kheizwan bin Ab Halim @ Kamaruddin, Sharifah Nurashiqin binti Syed Alwi and Ahmad Muqri bin Ahmad Fairoz (Messrs. Manjit Singh Sachdev Mohammad Radzi & Partners) for the Plaintiff Alicia Goh Ai Chen and Lian Yong En (Messrs. KP Lu & Tan) for the Defendants Yeoh Jie Hu (Messrs. Yeoh & Partners) for the Proposed Intervener Case reference 1. Pegang Co Ltd v Choong Sam & Ors [1969] 2 MLJ 52 2. Tajjul Ariffin bin Mustafa v Heng Cheng Hong [1993] 2 MLJ 143 3. Hong Leong Bank Bhd (formerly known as Hong Leong Finance Bhd) v Staghorn Sdn Bhd and other appeals [2008] 2 MLJ 622 4. Fima Bulking Services Bhd & Ors v Kazhou Pte Ltd (Lembaga Minyak Sawit Malaysia, proposed intervener) [2025] MLJU 2632 5. Low Lee Lian v Ban Hin Lee Bank Bhd [1997] 1 MLJ 77 6. Public Bank Berhad v Lee Bak Soon @ Lee Pak Choon & Ors [2008] MLJU 766 7. Kosma Palm Oil Mill Sdn Bhd & Ors v Koperasi Serbausaha Makmur Bhd [2003] 4 CLJ 1 8. Ming Ann Holdings Sdn Bhd v Danaharta Urus Sdn Bhd [2002] 3 CLJ 380 9. Low Tin Yong @ Low Yong Lian v Low Ying Thuan [2016] 3 MLJ 332

Upmarket Development Sdn Bhd v Sriera Development Sdn Bhd [2011] 4 MLJ 681

Marzaidi bin Mohammad (suing as the guardian / next friend and the litigation representative for Muhammad Muhriz bin Marzaidi) & Anor v Mohamed Affendi bin Khairuddin and another appeal [2025] 4 MLJ 919 Legislation reference 1. Sections 254, 260, 261 and 344 of the National Land Code 2. Order 1A, Order 2 rule 3 and Order 15 rule 6 (2) of the Rules of Court 2012