Ambank (M) Berhad v Cstme Resources Sdn Bhd (WA-22NCC-265-05/2023)

CSTME RESOURCES SDN BHD [No. Pendaftaran Syarikat: 200401038012 (676523-U)]

IMPIANA ALAMJAYA SDN BHD [No. Pendaftaran Syarikat: 201101025458 (953594-A)]

ALBERT TAN YEAN HEONG (No. K/P: 761123-01-7125)

WAN AHMAD KAMAL BIN MOHD RASDI … DEFENDAN - (No. K/P: 751017-08-5539) DEFENDAN JUDGMENT (Enclosure 21) [1] This was the Plaintiff’s application for summary judgment in Enclosure 21 against the Defendants pursuant to Order 14 of the Rules of Court 2012 (“ROC”) (“this Application”). [2] Having considered the submissions, pleadings and affidavit evidence before me, I allowed this Application. These are my grounds. S/N aaa0EEFHjkayxLUMwPquZw Page 2 of 29 A] SALIENT BACKGROUND FACTS [3] At the request of the 1st Defendant, the Plaintiff granted multiple banking facilities to the 1st Defendant through various Letters of Offer and a Facilities Agreement dated 27.9.2017, which included: i) An Overdraft (Account No. 0008881020891785); ii) A Term Loan 1 (Account No. 8080061375000000); iii) A Term Loan 2 (Account No. 8080066664000000); iv) A Term Loan 3 (Account No. 8220011015000000); and v) A Multi-Trade Facility. (collectively “the Facilities”) [4] The Facilities were granted pursuant to: i) Letter of Offer dated 28.7.2017; ii) Letter of Offer dated 1.3.2018; iii) Letter of Offer dated 29.8.2018; iv) Two Letters of Offer both dated 10.4.2019; v) Supplementary Letter dated 8.7.2021; vi) Two Letters of Offer both dated 29.9.2022; vii) Letter dated 14.2.2023; viii) Facilities Agreement dated 27.9.2017 (“Facilities Agreement”) (collectively “the Agreements”) [5] As security for the Facilities: i) The 2nd Defendant executed a Third Party First Legal Charge dated 25.10.2017 (“the Charge”) over a parcel of leasehold residential building comprising 6 dwelling units measuring approximately 34,018 square feet held under HSD 3, PT 5767 in Mukim Kuala Lumpur (“the Land” or “charged property”). The Charge was registered on 7.11.2017 in favour of the Plaintiff. ii) The 3rd and 4th Defendants executed a Guarantee and Indemnity dated 27.9.2017 (“Guarantee”) whereby they jointly and severally guaranteed payment of all monies due and payable by the 1st Defendant under the Facilities. S/N aaa0EEFHjkayxLUMwPquZw Page 3 of 29 [6] The 1st Defendant defaulted in its payment obligations under the Facilities. [7] Consequently, by letter dated 20.3.2023, the Plaintiff’s solicitors declared Events of Default had occurred, recalled the Facilities and demanded payment from the 1st Defendant of the outstanding sums. This letter was copied to the other Defendants. [8] Despite the demand, the 1st Defendant failed to make payment. [9] By letters dated 11.4.2023, the Plaintiff’s solicitors demanded payment from the 2nd, 3rd and 4th Defendants respectively. [10] The 2nd, 3rd and 4th Defendants also failed to make payment. [11] On 12.5.2023 the Plaintiff commenced this action claiming the total sum of RM40,812,665.73 as at 28.2.2023 with interest thereon. B] THE PLAINTIFF’S CASE [12] The Plaintiff’s main contentions are summarised below. [13] The preliminary requirements under Order 14 ROC have been satisfied in that: i) The Defendants have entered appearance; ii) Statement of Claim has been served; iii) The supporting affidavit complies with Order 14 Rule 2 ROC. [14] The Plaintiff had produced the Certificate of Indebtedness which is conclusive evidence of the debt pursuant to: i) Clause 18.1(a)(ii) of the Facilities Agreement. ii) Clause 45.1(b) of the Annexure to the Charge. iii) Clause 15.1 of the Guarantee and Indemnity. S/N aaa0EEFHjkayxLUMwPquZw Page 4 of 29 [15] Hence, the Plaintiff submits it has fulfilled the requirements of an Order 14 ROC application thereby shifting the burden to the Defendants to show satisfactory explanation as to why summary judgment should not be entered against them and that the Defendants have failed to raise any triable issue or some other reason to be a trial (Bank Negara Malaysia v. Mohd Ismail Ali Johor & Ors [1992] 1 CLJ (Rep) 14; National Company for Foreign Trade v. Kayu Raya Sdn Bhd [1984] 1 CLJ (Rep) 283). [16] The Plaintiff further submits that the Defendants have no defence to the claim as: i) The Facilities were duly released and utilised. ii) Default has occurred. iii) Demands were properly made. iv) The debt remains outstanding. C] THE 1ST DEFENDANT’S DEFENCE [17] The 1st Defendant’s defence and arguments in opposing this Application are summarised below. [18] The Plaintiff failed to properly plead and prove: i) The actual loan sums disbursed. ii) Details of the alleged default. iii) Computation of the claim amount. [19] The Certificate of Indebtedness contains manifest errors and is not supported by evidence like bank statements. [20] The action is premature as the Plaintiff has commenced separate foreclosure proceedings. S/N aaa0EEFHjkayxLUMwPquZw Page 5 of 29 [21] The 1st Defendant contents the following are triable issues in its Written Submissions (Enclosure 40): i) Whether the 1st Defendant was aware of the Financing Documents and Facilities. ii) Whether the Plaintiff has sufficiently pleaded and proven breach. iii) Whether the Plaintiff has proven computation of the claim sum. iv) Risk of duplicity with another proceeding (Originating Summons No. WA-24FC-849-07/2023 (“foreclosure proceedings”). v) Whether the statement of indebtedness is accurate and properly issued. vi) Basis for the sum stated in the statement of indebtedness. vii) Whether documents were properly served. [22] As will be demonstrated later in this Judgment, the 1st Defendant subsequently abandoned most of the above issues and adopted a different line of argument. D] THE 2ND DEFENDANT’S DEFENCE [23] The 2nd Defendant’s defence and arguments in opposing this Application are summarised below. [24] The 2nd Defendant never received a proper demand from the Plaintiff. [25] As a third party chargor, the Plaintiff must first establish its claim against the 1st Defendant. [26] The Plaintiff acted inequitably in refusing redemption of the charged property. S/N aaa0EEFHjkayxLUMwPquZw Page 6 of 29 E] THE 3RD and 4TH DEFENDANTS’ DEFENCE [27] The 3rd and 4th Defendants’ defence and arguments in opposing this Application are summarised below. [28] The Plaintiff must prove its claim against the 1st Defendant first before proceeding against the guarantors. [29] The 3rd and 4th Defendants’ content the following are triable issues in their Written Submissions (Enclosure 34): i) Whether the Plaintiff has to establish its claim against the 1st Defendant as principal debtor prior to proceedings against the 3rd and 4th Defendants as guarantor; ii) Whether the Plaintiff’s simultaneous actions against the Defendants and the charged property amount to duplicity of action since the Plaintiff is attempting to claim the same amount in this action and the foreclosure proceedings. F] ANALYSIS AND FINDINGS [30] The core opposition to this Application was led by the 1st Defendant, with the other Defendants largely adopting the 1st Defendant’s arguments and position. F1: THE 1ST DEFENDANT’S CHANGE IN POSITION [31] It must first be emphasised that the 1st Defendant had substantially changed its position from its original pleaded case. In its Defence and its Affidavit In Reply opposing this Application (Enclosure 25) the 1st Defendant raised the following: i) Granting of the Facilities: First, regarding the Facilities, the 1st Defendant challenged the Plaintiff to prove that the Facilities were actually granted and utilised. Specifically, the 1st Defendant questioned whether all the Facilities were properly disbursed with the stated terms and interest rates. S/N aaa0EEFHjkayxLUMwPquZw Page 7 of 29 ii) Foreclosure proceeding should proceed first: Second, on the realisation of the Charge, the 1st Defendant argued that the Plaintiff should have first taken steps to realise the charged property before commencing this legal action, since the property’s substantial value could significantly reduce the claimed debt. iii) Never Received Notices: Third, concerning notices and demands, the 1st Defendant denied receiving any of the letters and notices that the Plaintiff claimed to have served. The 1st Defendant contended that without proper service of these notices, any demands made by the Plaintiff were invalid and unenforceable. iv) General challenge on the amount claimed: Fourth, regarding the claimed debt amount, the 1st Defendant made a general denial of the sums claimed by the Plaintiff. The 1st Defendant did not focus on disputing the accuracy of the figures, nor did it provide any details regarding the alleged inaccuracies in the sums claimed. In fact, the Plaintiff could be said to agree with the amount claimed given its following averment in paragraph 9 of Enclosure 25: “Sebagai alternatif, saya menyatakan bahawa saya juga telah dimaklumkan bahawa Defendan Pertama telah memaklumkan kepada Plaintif bahawa Defendan Pertama telah mendapat seorang pembeli yang berminat untuk membelikan Hartanah tersebut dan memohon Plaintif untuk membenarkan supaya Hartanah tersebut ditebus dengan jumlah RM10,000,000.00 (“Redemption Sum”) dan baki jumlahnya akan dibayar secara ansuran. (own emphasis added) [32] However, prior to the hearing of this Application the 1st Defendant changed its position and this can be seen from the 1st Defendant’s Reply Submissions (Enclosure 55) which were further amplified via oral submissions at the hearing where the 1st Defendant: i) No longer disputes the existence of the Agreements but focuses on whether the Plaintiff has proven the actual debt amount. S/N aaa0EEFHjkayxLUMwPquZw Page 8 of 29 ii) Now acknowledges the Facilities were granted but argues that the Plaintiff failed to provide proper evidence of the computation of the debt. iii) No longer disputes receipt of the relevant notices of demand but challenges how the debt was calculated. iv) No longer emphasises on the foreclosure, instead, focuses on the Plaintiff’s alleged lack of financial proof. [33] In summary, the 1st Defendant has significantly altered its position. Initially, it denied the existence of the loan and facilities, as well as the related demands, but has since shifted its stance to acknowledge these matters while raising a new issue regarding the computation of the sums owed. [34] I state that this issue regarding the computation of the sums claimed is new because it was not raised in the 1st Defendant’s Defence or its Affidavit In Reply in Enclosure 25. In its Defence and Enclosure 25 the 1st Defendant merely denied the sums claimed. This can be seen from the following: i) Details of the outstanding sums under the Facilities and the sums claimed by the Plaintiff were pleaded in, inter alia, paragraphs 25 and 26 of the Statement of Claim. The 1st Defendant responded to these paragraphs of the Statement of Claim as follows: Paragraph 12 and 13 of the 1st Defendant’s Defence “12. Defendan Pertama merujuk kepada perenggan-perenggan 19, 20, 22, 25 and 26 SOC tersebut dan menafikan bahawa Defendan Pertama pernah menerima Surat-Surat tersebut seperti yang didakwa oleh pihak Plaintif. Oleh yang demikian, Defendan Pertama memplidkan bahawa permintaan Plaintif melalui sebarang Notis adalah tidak sah kerana ia tidak pernah disampaikan dan/atau berada di dalam pengetahuan Defendan Pertama pada semua masa material. Di samping itu, sekiranya ada penghantaran Notis (dimana adalah dinafikan), ia telah menyatakan suatu fakta yang tidak tepat dan/atau tidak benar serta penghantarannya adalah tidak mengikut peruntukan undang-undang dan oleh itu tidak boleh dikuatkuasakan terhadap Defendan Pertama pada semua masa material. S/N aaa0EEFHjkayxLUMwPquZw

Page 9 of 29 Lanjutan daripada perenggan di atas, Defendan Pertama menafikan bahawa Defendan Pertama adalah berhutang terhadap Plaintif seperti yang diplidkan dalam perenggan 25 dan 26 SOC tersebut dan selanjutnya meletakkan pihak Plaintif ke atas beban bukti yang kukuh untuk membuktikan dakwaan-dakwaan Plaintif tersebut.” (own emphasis added) ii) Similar averments regarding the outstanding sums under the Facilities and the sums claimed by the Plaintiff were raised in the Plaintiff's Affidavit in Support (Enclosure 22), to which the 1st Defendant provided a similar response in its Affidavit In Reply (Enclosure 25), as follows: Paragraph 5 of Enclosure 25 “5. Saya merujuk kepada perenggan-perenggan 5,6,19,20 dan 21 Afidavit Sokongan tersebut dan menafikan bahawa Defendan Pertama adalah berhutang kepada Plaintif sebanyak RM40,812,665.73. Kandungan perenggan-perenggan tersebut adalah tidak diakui dan Defendan Pertama meletakkan Plaintif diatas beban bukti yang kukuh.” (own emphasis added) [35] It is therefore unequivocally clear that the issue regarding the incorrect “computation” of the outstanding sums under the Facilities and the sums claimed by the Plaintiff was never raised. [36] It is important for me to place emphasis on the 1st Defendant’s change in position, as learned counsel for the 1st Defendant had spent a considerable amount of time at the hearing of this Application: i) Challenging the computation of outstanding sums under the Facilities and the sums claimed; ii) Raising issues regarding the default interest; iii) Arguing on the actual sums disbursed under the Facilities; iv) Challenging the correctness of the Certificate of Indebtedness. [37] The above issues were only raised via the 1st Defendant’s Written Submissions and specifically via oral submissions at the hearing of S/N aaa0EEFHjkayxLUMwPquZw Page 10 of 29 this Application. These issues or arguments were not contained in the 1st Defendant’s Defence or the 1st Defendant’s Affidavit In Reply (Enclosure 25). [38] The 1st Defendant’s change in position raises two critical questions: i) Whether the 1st Defendant should be permitted to introduce these new issues through its submissions; and ii) Whether the Court should entertain or address these issues. [39] The answer to both the above questions can be found in the following passage from the case of Ribaru Bina Sdn Bhd & Anor v. Bakti Kausar Development Sdn Bhd & Anor [2007] 1 CLJ 552 where the Court of Appeal held as follows: “[5] To raise triable issues by way of submission on a point not raised in a defence or an affidavit would not, in our judgment, meet the requirements of procedural fairness which is the essence of any litigation.” (own emphasis added) [40] Further, bare allegations are not sufficient, the 1st Defendant must, via its Affidavit In Reply, descend to particulars of any issues it intends to raise concerning the outstanding sums under the Facilities and the sums claimed. In Chiam Ching Kiang v. Menteri Hal Ehwal Dalam Negeri, Malaysia & Anor [1994] MLJU 8 it was held as follows: “It is trite law that where the application or affidavit in support thereof has not raised any specific ground, then that ground cannot be raised in the submission. To allow the applicant to do so is unjust to the respondents who are not able to reply to the ground which was not raised in the applicant's affidavit especially so when these proceedings are tried on affidavits alone, when each and every particular detail can be replied by including the same in the affidavits.” (own emphasis added) [41] Whilst the case of Chiam Ching Kiang (supra) is a criminal case, I do see any reason for it not apply in a civil case (see also Chin Chong Nang v. Menteri Hal Ehwal Dalam Negeri, Malaysia & Yg. Lain [1991] 2 CLJ 1126). S/N aaa0EEFHjkayxLUMwPquZw Page 11 of 29 [42] The new issues raised via the 1st Defendant’s submissions involve factual matters and must be pleaded and addressed by the 1st Defendant itself in its Affidavit In Reply, and not through the submissions of the 1st Defendant’s counsel (Ribaru Bina (supra)). [43] Be that as it may, for the sake of completeness, I will still address these new issues raised by the 1st Defendant in its submissions in addition to those which were raised through the 1st Defendant’s Defence and Enclosure 25. F2: SUMMARY OF ISSUES RAISED BY DEFENDANTS COLLECTIVELY [44] As the 2nd to 4th Defendants have adopted the 1st Defendant’s arguments and raised similar, if not identical, contentions, the grounds collectively relied upon by all the Defendants are summarised as follows, including those that were abandoned or later not disputed: i) Denial of the Facilities and receipt of the Notices. ii) The Plaintiff alleged failure to plead and prove: a) which Facility the 1st Defendant had defaulted; b) how much was disbursed under each Facility; iii) The Certificate of Indebtedness is not conclusive. The Plaintiff is alleged to have failed to produce supporting document such as bank statements or transaction records to substantiate the outstanding debt. iv) The Plaintiff should have exhausted the security (the charged property) before commencing this action by concluding with the foreclosure proceedings first; and v) Multiplicity or duplicity of proceedings. There is a risk of duplicate claims, as related proceedings are pending in another forum, namely the foreclosure proceedings. S/N aaa0EEFHjkayxLUMwPquZw Page 12 of 29 1st Issue: Denial of the Facilities and Receipt of the Notices [45] The Plaintiff had addressed the Defendants’ denial of the Facilities and alleged non-receipt of demands by, inter alia, exhibiting the relevant documents in its Affidavits and followed by its submissions which I accept. They are essentially as follows: Denial of the Facilities i) The 1st Defendant had duly executed the Letters of Offer and the Facilities Agreement. Once an agreement is signed, the 1st Defendant is bound by its terms, regardless of whether they later claim ignorance of the Facilities (Lee Heng Yak & Anor v. Li Chee Loong & Anor [2018] MLJU 1346 (CA)), where it was held that a party who signs a written document is bound by its terms, whether or not they have read it. ii) Further, the 1st Defendant had expressly referred to the Facilities in its letters dated 8.3.2023, 17.3.2023, 31.3.2023 and 18.4.2023, acknowledging the existence of the debt. iii) Therefore, the Defendants are estopped from denying their obligations under the Facilities (Boustead Trading (1985) Sdn Bhd v. Arab-Malaysian Merchant Bank Bhd [1995] 3 MLJ 331 (FC)). Non-Receipt of the Demands iv) The Notice of Recall and Demand dated 20.3.2023 and subsequent demand letters dated 11.4.2023 were properly served at the 1st and 2nd Defendants’ registered and business addresses, as confirmed by the supporting documents exhibited in the Plaintiff’s Affidavit In Support. v) The demand notices were properly served on the 3rd and 4th Defendants where service was effected at the addresses provided in the Guarantee executed by 3rd and 4th Defendants. vi) Once demand notices are sent to the correct addresses, they are deemed received, regardless of whether the recipient personally acknowledges them. In Affin Bank Bhd v. HIB-C Industries Sdn Bhd & Ors [2013] 3 MLJ 41, the Court ruled that proper service is established even if the acknowledgment S/N aaa0EEFHjkayxLUMwPquZw Page 13 of 29 is by an unidentified person, as long as the prerequisites of service were followed. A similar position was taken in Pengkalen Concrete Sdn Bhd v. Chow Mooi [2003] 3 MLJ

[46] Therefore, regardless of the 1st Defendant’s change in position on the above issues, the Plaintiff has established the existence of the Facilities, the granting and utilisation of the Facilities, as well as the receipt of the relevant Notices sent to the Defendants. In this regard, the Defendants’ denial are merely bare denials. 2nd Issue: Default and Disbursement of the Facilities [47] Despite the various correspondences between 1st Defendant and the Plaintiff, it is surprising to say the least, that these issues should be raised. [48] In any event, in so far as the pleadings are concerned, the Defendants’ argument which were mainly raised by learned counsel for the 1st Defendant, that the default and disbursement of the Facilities was not pleaded is entirely without merit. These matters were clearly pleaded in, inter alia, the following paragraphs of the Statement of Claim: Paragraph 6 of the Statement of Claim “All the aforesaid facilities stated in paragraphs 6(a) to 6(e) above shall collectively be referred to as “the Facilities”. (own emphasis added) Paragraph 17 of the Statement of Claim “The Plaintiff had duly released and the 1st Defendant had duly utilized the Facilities.” (own emphasis added) Paragraph 18 of the Statement of Claim “The 1st Defendant had defaulted in its payment obligations to the Plaintiff in respect of the Facilities on due dates despite reminders and is in breach of its obligations.” (own emphasis added) S/N aaa0EEFHjkayxLUMwPquZw Page 14 of 29 Paragraph 25 of the Statement of Claim “In this regard, the 1st Defendant, the 2nd Defendant, the 3rd Defendant and the 4th Defendant and each of them are indebted to the Plaintiff under the Facilities in the total sum of RM40,812,665.73 due as at 28.2.2023 with interest thereon, the details of which are as follows: ……” (own emphasis added) [49] It is evident from the above paragraphs of the Statement of Claim that: i) the 5 Facilities as stated earlier in this Judgment were listed in detail and the defined as “the Facilities” in paragraph 6; ii) the fact that the Facilities were disbursed and utilised can be seen in paragraph 17 of the Statement of Claim; iii) the default of the Facilities (all of them) by the 1st Defendant is pleaded in paragraph 18; iv) the details and breakdown of the total sum of RM40,812,665.73, due as at 28.2.2023, claimed in this action, are set out in paragraph 25, which also specifies the interest rate charged on each Facility. [50] There is no dispute that the Facilities were utilised by the 1st Defendant, as evidenced by, inter alia, the following: i) The 1st Defendant did not previously raise any complaints about non-disbursement when making use of the Facilities. ii) The Certificate of Indebtedness, which details the sums due and payable, constitutes conclusive evidence of the amounts owed. This will be addressed in greater detail when discussing the effect of a certificate of indebtedness. iii) The Defendants have not produced any evidence to dispute the amounts due or to demonstrate any manifest error in the Certificate of Indebtedness. Instead, they have merely made bare denials, which do not constitute a valid defence or a triable issue. S/N aaa0EEFHjkayxLUMwPquZw Page 15 of 29 iv) In various correspondences from the 1st Defendant to the Plaintiff, which will be detailed later in this Judgment, the 1st Defendant requested additional time to make payment. At no point in these correspondences did the 1st Defendant deny the existence of the Facilities, their disbursement or its obligation to pay. 3rd Issue: Certificate of Indebtedness [51] Learned counsel for the 1st Defendant submitted at length on the Plaintiff’s Certificate of Indebtedness and argued that there were no bank statements or transaction records produced to prove or support the sums stated in the Certificate of Indebtedness. [52] In this regard there were two main arguments raised by the 1st Defendant on this issue: i) The Statement of Claim lacks particulars regarding the sums owed or the amounts claimed are incorrect. Therefore, the Certificate of Indebtedness is defective and cannot be regarded as conclusive; ii) The sums claimed or owed cannot be determined solely by the Certificate of Indebtedness. Supporting proof, such as bank statements, transaction records and calculations, must be provided. [53] Learned counsel for the 1st Defendant cited numerous cases in support of the above arguments. However, with respect to the first argument on defective pleading (paragraph 52(i) above), it is unnecessary for me to address this argument and the cases cited in support thereof, as I have already found, as stated earlier, that the Statement of Claim contains no defects. The Plaintiff has sufficiently pleaded all material facts regarding the Facilities and the default. [54] This brings me to the second argument concerning the lack of documents to support the Certificate of Indebtedness. In this regard, learned counsel for the 1st Defendant cited the following cases: S/N aaa0EEFHjkayxLUMwPquZw Page 16 of 29 i) Perwira Affin Bank Bhd v. Orison Sdn Bhd & Ors [2004] 5 CLJ 256 (HC); ii) Md Salleh bin Sajida v. Y.A.M. Tunku Zabedah Aminah Maimunah Iskandariah [2022] 1 LNS 1203; iii) Oriental Bank Bhd. v. Jaafar Sidek Mohd. Salam & Ors [1990] 2 CLJ (Rep) 585 (HC); iv) Credit Corp (M) Bhd v. Lucky Height Development Sdn Bhd & Ors [1996] 4 MLJ 556 (HC). [55] First and foremost, there is no dispute that the Defendants have the right to challenge the Certificate of Indebtedness, as the case law on this is clear. However, the issue lies in the manner in which this challenge was mounted. It cannot be based on mere unsupported allegations that the Certificate contains errors or is inaccurate. [56] Second, if any of the above four cases implied that a Certificate of Indebtedness alone is not enough and that proof of the amount owed requires additional documents like bank statements, this view has now changed. This can be seen from the Federal Court’s decision in Cempaka Finance Bhd v. Ho Lai Ying (trading as KH Trading) & Anor [2006] 2 MLJ 685 where it was held as follows: “[5] Quite clearly, the Court of Appeal has put the burden on the plaintiff to prove his case in an O 14 application. With respect, that cannot be the correct proposition of law. In an application under O 14, the burden is on the plaintiff to establish the following conditions: that the defendant must have entered appearance; that the statement of claim must have been served on the defendant; that the affidavit in support must comply with r 2 of O 14 in that it must verify the facts on which the claim is based and must state the deponent’s belief that there is no defence to the claim (see Supreme Leasing Sdn Bhd. v Dior Enterprises dr Ors [1990] 2 MLJ 36). Once those conditions are fulfilled, the burden then shifts to the defendant to raise triable issues. The law on this is trite. …..’ S/N aaa0EEFHjkayxLUMwPquZw Page 17 of 29 “The above dictum establishes firmly the conclusive nature and extent of a certificate of indebtedness. A certificate of indebtedness operates in the field of adjectival law. It excuses the plaintiff from adducing proof of debt. Such a certificate shifts the burden onto the defendant to disprove the amount claimed.” (own emphasis added) [57] The Federal Court in Cempaka Finance (supra) further held: “[10] This observation appeared to have escaped the attention of the Court of Appeal in the present case. In the result, the Court of Appeal took the position that the conclusiveness of the certificate of indebtedness exh P3 was binding only upon the parties and that the court would still have to determine whether sufficient evidence had been adduced to prove quantum and the correctness of the amount claimed. With respect, such a proposition goes against the entrenched principles enunciated by Raja Azlan Shah CJ (Malaya) (as His Highness then was) in Citibank NA v Ooi Boon Leong dr Ors [1981] 1 MLJ 282 when he said, inter alia: We have often said in this court many a time that where the issues are clear and the matter of substance can be decided once and for all without going to trial there is no reason why the assistant registrar or the judge in chambers, or, for that matter, this court shall not deal with the whole matter under the RSC O 14 procedure. In the present case, the guarantee contains a clause which enables the bank by producing a certificate of indebtedness by its officer to dispense with legal proof of the actual indebtedness of the respondents. ... It means that, for the purpose of fixing liability of the respondents, the company’s indebtedness may be ascertained conclusively by a certificate. [11] The above dictum establishes firmly the conclusive nature and extent of a certificate of indebtedness. A certificate of indebtedness operates in the field of adjectival law. It excuses the plaintiff from adducing proof of debt. Such a certificate shifts the burden onto the defendant to disprove the amount claim.” (own emphasis added) S/N aaa0EEFHjkayxLUMwPquZw Page 18 of 29 [58] The principle in Cempaka Finance (supra) was applied in the case of Tan Chong Keat v. Pengurusan Danaharta Nasional Bhd [2008] 4 CLJ 748 in which the Court of Appeal held as follows: “[7] It follows, in our judgment, that the submissions advanced by the appellant that the respondent had failed to discharge the burden of proving the sums due to the lending bank from the appellant is without merit. Once the respondent adduced in evidence the cl. 13 certificate of indebtedness, the debt was proved. It was then for the appellant to attack the said certificate on grounds of manifest error. And that brings us to the second argument made before us.” (own emphasis added) [59] The arguments presented by learned counsel for the 1st Defendant at the hearing of this Application is similar to that which was raised by the appellant in Tan Chong Keat (supra), and similarly, the disputes raised by the appellant were not pleaded, as in the instant case. The Court of Appeal addressed these points and held as follows: “[8] Learned counsel for the appellant submitted that the cl. 13 certificate of indebtedness was a useless piece of paper because the documentary evidence before the court had shown a reduction of the rate of interest by the lending bank on more than one occasion. Accordingly, the respondent’s own documents produced at trial rendered the certificate of indebtedness so unreliable that the judge was not entitled to act upon it. “[9] Although in para. 1 of his defence, the appellant stated, to use the pleader’s words; “the plaintiff’s claim is incorrect and does not specify the exact amount claimed, less whatever payments made”, nowhere in that pleading is to be found an assertion that the certificate of indebtedness was bad for manifest error. Further, nowhere in the defence have there been any particulars pleaded, disclosing the nature of the alleged manifest error. In the face of this glaring omission, the learned judge cannot be faulted for failing to deal with the point. A plea of manifest error is a special plea, and in accordance with O. 18 r. 12 of the Rules of the High Court 1980 must be expressly taken. A plaintiff who relies on an account stated or a certificate of indebtedness is entitled, as a matter of natural justice, to know the grounds on which the account or certificate, as the case may be, is challenged on substantial grounds admissible in law. In our judgment, since the point was S/N aaa0EEFHjkayxLUMwPquZw Page 19 of 29 not properly taken by the appellant, it is not open to him now to raise this in his argument in support of his appeal.” (own emphasis added) [60] The 1st Defendant and, by extension, all the Defendants, has failed to demonstrate any manifest error in the Certificate of Indebtedness. In fact, the 1st Defendant’s Affidavit in Reply (Enclosure 25) makes no reference to the Certificate of Indebtedness exhibited by the Plaintiff in Enclosure 22. Consequently, following the principles established in Tan Chong Keat (supra) and Ribaru Bina (supra), the Defendants are precluded from now alleging that there is a manifest error in the Certificate of Indebtedness. [61] In any event, the Defendants have failed to produce any evidence of a manifest error in the Certificate of Indebtedness, relying solely on bare denials and challenging the Plaintiff to provide supporting documents, a point that is immaterial (Cempaka Finance (supra)). [62] I would further add that, in the absence of specific averments in the Defendants’ affidavits or evidence demonstrating a manifest error in the Certificate of Indebtedness, learned counsel for the 1st Defendant cannot substitute such proof with her own submissions alleging mistakes in the Certificate. In support of this, I refer to the case of Bank Muamalat (M) Bhd v. Hexagon Holdings Bhd [2015] 7 MLJ 134, the facts of which are similar to the present case, where counsel for the defendant similarly raised arguments from the bar without providing supporting evidence. The Court held as follows: “[24] I observed that this line of submission was adopted by learned counsel from the bar table without the benefit of the evidence by way of affidavit to indicate that there was manifest error on the face of the said certificate of indebtedness. I am of the view that the defendant could not arbitrarily dispute the accounts of the plaintiff without showing evidence of manifest errors in its affidavit. In order to challenge the correctness and/or conclusiveness of the certificate of indebtedness, something more was required of the defendant other than raising the same vide his learned counsel's written and oral submission. This would also give ample opportunity to the plaintiff to rebut all allegations made in the affidavit by way of affidavit evidence. As this was not done, the plaintiff was not in a position to explain how the calculations as shown in the certificate of indebtedness S/N aaa0EEFHjkayxLUMwPquZw Page 20 of 29 were arrived at. In so far as the plaintiff was concerned, once the certificate of indebtedness had been exhibited, the plaintiff was not obliged to provide further evidence of the outstandings. In fact under the law, it was for the defendant to show evidence of manifest error, which the defendant had failed to do by way of affidavit evidence. The defendant had further claimed that the said certificate of indebtedness is baseless but had not demonstrated by way of affidavit evidence how the said certificate was said to be baseless.” (own emphasis added) [63] It bears repeating that learned counsel for the 1st Defendant cannot raise arguments from the bar or through submissions if the facts giving rise to these arguments were not raised in the affidavits or, more importantly, if they were not pleaded. [64] Therefore, I find that the Defendants are bound by the Certificate of Indebtedness, as specifically provided in Clause 18.1 of the Facilities Agreement, Clause 45 of the Annexure to the Charge and Clause 15 of the Guarantee which allow the Plaintiff to dispense with legal proof of the Defendant’s actual indebtedness (Cempaka Finance (supra); Citibank N.A v. Ooi Boon Leong & Ors [1981] 1 MLJ 282). 4th Issue: Foreclosure Proceedings and Duplicity/Multiplicity [65] The Defendants argument that this action is premature and the Plaintiff should have exhausted the security (foreclosure proceedings in respect of the charged property) first is without merit. The position of the law on this is trite as demonstrated in the following cases: i) In Low Lee Lian v. Ban Hin Lee Bank Bhd [1997] 1 MLJ 77, the Federal Court held that a creditor may pursue all remedies simultaneously, contemporaneously or successively to recover monies lent. The Federal Court held as follows: “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 S/N aaa0EEFHjkayxLUMwPquZw Page 21 of 29 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 pursue all of these courses simultaneously, contemporaneously or successively. See China and South Sea Bank Ltd v Tan [1989] 3 All ER 839 at p 842.” (own emphasis added) ii) The above principle in Low Lee Lian (supra) was reiterated in Chan Boi Loi v. Public Bank Bhd & Another Application [2009] 6 CLJ 81 where the Federal Court held as follows: “[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. Such an agreement is not to be implied from a clause in an annexure to a charge in terms of cls. 8 and 16 in the present instance. All that a clause in those terms does is to create a right in the lender to recover the balance outstanding in the event that a sale of the charged property produces a shortfall. It is not an agreement by the instant respondent bank to postpone its right to bring an action in personam for the recovery of the whole sum lent (together with interest) until after the charged land has been sold. If the courts were to read such an agreement into the clauses in question it would amount to an unwarranted restriction on a lender's rights to seek the remedies open to it. The fallacy of the contrary argument is revealed by asking the question: what if the land can never be sold despite all attempts to do so? It would mean that the borrower would get away scot-free from making any payment because his answer to any action by the lender upon the covenant to pay would be that it is a condition precedent that the land be sold and a shortfall produced before any suit may be instituted. The want of logic in that proposition is sufficient to demonstrate that it is not common sense and certainly not the common law.” (own emphasis added) [66] A similar principle applies to the Guarantors and this can be seen in Bank Bumiputra Malaysia Bhd v. Esah Binti Abdul Ghani [1986] 1 MLJ 16 where the Supreme Court held, inter alia, that the surety is not entitled to demand that the creditor apply the securities before they are held liable; instead, the creditor remains S/N aaa0EEFHjkayxLUMwPquZw Page 22 of 29 free to use any legal remedies available under the original contract until the debt is fully discharged. [67] Further, the Defendants had expressly agreed under the following clauses of the respective agreements that the Plaintiff can exercise all remedies concurrently and is not required to sell the charged property first: i) Clause 13.4 of the Facilities Agreement; ii) Clause 16 of the Charge Annexure; iii) Clause 9.2 of the Guarantee. [68] Therefore, the Plaintiff is not restricted from proceeding with this action concurrently with the foreclosure proceedings and the Defendants are estopped from contending otherwise (Boustead Trading (supra)). [69] As far as the 2nd Defendant is concerned, under Clause 3 of the Charge Annexure, the 2nd Defendant agreed to pay the debt (or “Secured Amounts” as stated therein) on demand. [70] There is also no issue of unjust enrichment as alleged by the Defendants as it is provided for under the Agreements that if the charged property were sold the proceeds of sale would be applied to the sums owed by the Defendants. F3: RES JUDICATA – ISSUES RAISED IN FORECLOSURE PROCEEDINGS [71] The foreclosure proceedings arose from the 1st Defendant’s default under the Facilities for the same sum (RM40,812,665.73 as at 28.2.2023) that is claimed in this action. [72] The net effect of the foreclosure proceedings, which resulted in the Order dated 26.1.2024, is that the Court’s decision in the foreclosure proceedings confirms that: i) There was a default of the Facilities by the 1st Defendant; S/N aaa0EEFHjkayxLUMwPquZw Page 23 of 29 ii) The default entitled the Plaintiff to foreclose on the charged property; iii) The same or similar issues raised in this action were determined in the foreclosure proceedings as the 2nd Defendant opposed the said proceedings. [73] The 2nd Defendant did not appeal against the Order dated 26.1.2024 and as such the decision stands unchallenged. This precludes the other Defendants from re-arguing the same issues. The principle of res judicata and issue estoppel apply, preventing re-litigation (Boustead Trading (supra)). F4: THE 1ST DEFENDANT’S ADMISSIONS [74] The 1st Defendant had written to the Plaintiff multiple times, both before and after the Plaintiff issued letters of demand, in an attempt to settle the outstanding amounts under the Facilities. [75] These letters constitute an acknowledgment of the debt owed to the Plaintiff and, by themselves, effectively extinguish all the Defendants’ arguments in opposing this Application. [76] In one such letter, dated 17.3.2023, the 1st Defendant stated to the Plaintiff, inter alia, as follows: “We thank you for your time in meeting us and to allow us to put forth our proposal towards settlement of the Facility outstanding to your Bank. As informed to your Bank’s management, our company sincerely wishes to restructure the Facility and will try to find means to settle the Facility on a win-win basis. We however regret to note that your Bank is not agreeable to allow the Property to be redeemed at a sum of RM10,000,000.00. We will therefore inform our current intended purchaser of your Bank’s decision. We would like to appeal to your Bank to allow our company to find an alternative purchaser to purchase the property at tile Purchase Price of RM12,000,000.00 and that your Bank fixes the redemption sum of RM12,000,000,00. We seek your Bank’s indulgence to confirm that your Bank is agreeable to the same and to allow us a time frame of 2 months to source for a new buyer at the said higher price. Upon receipt of your Bank’s confirmation, we will use our best endeavours to find a new buyer to purchase the Property. S/N aaa0EEFHjkayxLUMwPquZw Page 24 of 29 Rest assured that once the outstanding sum of the Facility is reduced by the payment of RM 12,000,000.00, our company will use our best endeavours to settle the balance outstanding to your Bank. We would appeal to have some penalty interest waived and further to allow our Company to repay the outstanding sums in staggered instalments. Our proposal to restructure the Facility is as follows, subject to your Bank’s consent and approval:- …” (own emphasis added) [77] The 1st Defendant’s above letter was not marked “without prejudice” and neither was there any reservation of rights by the 1st Defendant in the said letter. [78] Further, the contents of the said letter are also in line with the 1st Defendant’s averments as stated in paragraph 9 of Enclosure 25 which averments were reproduced in paragraph 31(iv) above. [79] The 1st Defendant wrote to the Plaintiff on, inter alia, four separate occasions in an attempt to settle the amounts claimed by the Plaintiff, thereby acknowledging the existence of the debt. The four letters are dated as follows: i)

8.3.2023; ii)

17.3.2023; iii) 31.3.2023; and iv) 18.4.2023. (collectively “Settlement Letters”) [80] The contents of the Settlement Letters clearly run contrary to the Defendants’ arguments. In these Letters, the 1st Defendant, inter alia: i) sought additional time to settle the amount outstanding under the Facilities, thereby effectively admitting liability for the outstanding sums; ii) did not dispute its default under the Facilities; iii) did not dispute the existence of the debt; iv) did not dispute the quantum of the amount claimed by the Plaintiff under the Facilities; S/N aaa0EEFHjkayxLUMwPquZw Page 25 of 29 v) did not dispute the existence of the Facilities; vi) did not dispute that funds under the Facilities were, in fact, disbursed; vii) did not dispute that the Notices were received, and in fact, some of the Settlement Letters responded to the Notices. [81] It is, therefore, surprising, to say the least, that the Defendants could raise all the issues stated earlier to oppose this Application, in light of these clear admissions of the debt. [82] The Settlement Letters, by themselves, put an end to the lengthy arguments raised by learned counsel for the 1st Defendant. G] CONCLUSION [83] It is pertinent to mention that the Defendants’ (specifically the 1st Defendant’s) change in position, as shown above, significantly affects their credibility. Learned counsel’s attempt to improve the Defendants’ defences, contrary to their affidavit averments and the pleadings in their Defence, does not benefit the Defendants. In fact, it worsens their position, as it gives the impression that they are approbating and reprobating, which is not permitted in litigation. [84] In this regard I can do no better than conclude by quoting a passage from the locus classicus case of Bank Negara Malaysia (supra) where the Supreme Court held as follows: “Under an O. 14 application, the duty of a Judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other on affidavit. Where such assertion, denial or dispute is equivocal, or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent or is inherently improbable in itself, then the Judge has a duty to reject such assertion or denial, thereby rendering the issue as not triable. …..” (own emphasis added) S/N aaa0EEFHjkayxLUMwPquZw Page 26 of 29 [85] In the present case the Defendants have failed to raise any bona fide triable issues requiring trial and the Plaintiff has established its entitlement to summary judgment. [86] For the reasons stated above, I allowed this Application with costs. Dated this 25th day of February, 2025 -SGD- (WAN MUHAMMAD AMIN BIN WAN YAHYA) Judge High Court of Malaya, Kuala Lumpur (Commercial Division (NCC 3)) COUNSEL FOR THE PLAINTIFF Freddy Choy Kay Chun Messrs Shook Lin & Bok Tingkat 20, Bangunan Kumpulan AmBank, 55 Jalan Raja Chulan, 50200 Kuala Lumpur Tel: 03-20311788 Emel: litigation@shooklin.com.my S/N aaa0EEFHjkayxLUMwPquZw Page 27 of 29 COUNSEL FOR THE 1ST DEFENDANT Lee Wooi Mien, Dahlia (Clement Phang and Melvan Tang Chi Chung together with her) Messrs Kam Woon Wah & Co. C-05-02, Blok C, Plaza Mont’ Kiara, No. 2, Jalan Kiara, Mont’ Kiara, 50480 Kuala Lumpur Tel: 03-62055280 Emel: general@kww-co.com COUNSEL FOR THE 2ND DEFENDANT Chong Kah Heng (Stella Tang Ying Ying together with him) Messrs K H Chong & Associates E-11-14, Plaza Mont’ Kiara, No. 2, Jalan Kiara, Mont’ Kiara, 50480 Kuala Lumpur Tel: 03-62019282 Emel: legal@khchong.com.my COUNSEL FOR THE 3RD AND 4TH DEFENDANTS Ooi Xi Fang Messrs Xi Fang & Co. Lot 1, 1st Floor, c/o Ixora Hotel Sdn Bhd, No. 3096, Jalan Baru, Bandar Perai Jaya, 13600 Perai, Pulau Pinang Tel: 017-4275610 Emel: xifangco@yahoo.com S/N aaa0EEFHjkayxLUMwPquZw Page 28 of 29 RULES CITED Rules of Court 2012 ▪ Order 14 Rule 2

Affin Bank Bhd v. HIB-C Industries Sdn Bhd & Ors [2013] 3 MLJ 41

Boustead Trading (1985) Sdn Bhd v. Arab-Malaysian Merchant Bank

Bank Muamalat (M) Bhd v. Hexagon Holdings Bhd [2015] 7 MLJ 134

Bank Bumiputra Malaysia Bhd v. Esah Binti Abdul Ghani [1986] 1

Bank Negara Malaysia v. Mohd. Ismail Ali Johor & Ors [1992] 1 CLJ (Rep) 14

Chiam Ching Kiang v. Menteri Hal Ehwal Dalam Negeri, Malaysia &

Chin Chong Nang v. Menteri Hal Ehwal Dalam Negeri, Malaysia &

Credit Corp (M) Bhd v. Lucky Height Development Sdn Bhd & Ors [1996] 4 MLJ 556

Cempaka Finance Bhd v. Ho Lai Ying (trading as KH Trading) & Anor [2006] 2 MLJ 685

Citibank N.A v. Ooi Boon Leong & Ors [1981] 1 MLJ 282

Chan Boi Loi v. Public Bank Bhd & Another Application [2009] 6 CLJ 81

Lee Heng Yak & Anor v. Li Chee Loong & Anor [2018] MLJU 1346

Low Lee Lian v. Ban Hin Lee Bank Bhd [1997] 1 MLJ 77 S/N aaa0EEFHjkayxLUMwPquZw

Page 29 of 29 Md Salleh bin Sajida v. Y.A.M. Tunku Zabedah Aminah Maimunah

National Company for Foreign Trade v. Kayu Raya Sdn Bhd [1984] 1

Oriental Bank Bhd. v. Jaafar Sidek Mohd. Salam & Ors [1990] 2 CLJ (Rep) 585

Pengkalen Concrete Sdn Bhd v. Chow Mooi [2003] 3 MLJ 67

Perwira Affin Bank Bhd v. Orison Sdn Bhd & Ors [2004] 5 CLJ 256

Ribaru Bina Sdn Bhd & Anor v. Bakti Kausar Development Sdn Bhd & Anor [2007] 1 CLJ 552

Tan Chong Keat v. Pengurusan Danaharta Nasional Bhd [2008] 4 CLJ 748 S/N aaa0EEFHjkayxLUMwPquZw