Dato' Sia Ah Guan v Kek Lye Kheng (BA-23NCvC-42-07/2025)

KEK LYE KHENG

WINSON KEK CHUN SEAN

WINNIE KEK JIA YING (NO. K/P: 000630-14-0690) … DEFENDAN-DEFENDAN GROUNDS OF JUDGMENT (Enclosure 9 – The First Defendant Application Under Order 18 Rule 19(1) Rules of Court 2012) 16/02/2026 12:33:28 BA-23NCvC-42-07/2025 Kand. 53 INTRODUCTION [1] This is an interlocutory application by the first defendant to strike out the plaintiff's claim pursuant to Order 18 Rule 19(1)(a) and/or (b) and/or (c) and/or (d) of the Rules of Court 2012 through Enclosure 9. [2] On 3.12.2025, this Court allowed the first defendant's application. The plaintiff is dissatisfied with the decision and has appealed to the Court of Appeal. RELEVANT FACTS [3] The plaintiff, a Malaysian citizen, met the first defendant at a wedding on 7.10.2022. The first defendant is a retiree and the father of the second and third defendants. The second defendant is a businessman in the internet technology sector and is employed by Aramasa Kontrak Sdn Bhd (AKSB). The third defendant is undergoing training in chambers at a law firm. [4] On or about 18.7.2023, the first defendant offered the plaintiff an investment scheme promising returns. The plaintiff agreed and withdrew RM1,000,000.00 in cash, which was paid to the first defendant on behalf of the AKSB. After 18.7.2023, the plaintiff was promised their first dividend return in August 2023. [5] From 7 September 2023 until 20 December 2024, five dividend payments were made to the plaintiff, totaling RM88,907.00. [6] According to the plaintiff, after receiving RM10,000.00 on 21 November 2023, the plaintiff frequently contacted the first defendant requesting the return of the investment. The first defendant executed a Debt Settlement Agreement promising repayment of the plaintiff's money within three years. [7] Following the dividend payment of RM88,907.00, the plaintiff no longer received any further dividend payments and alleged that the defendants employed fraudulent tactics by portraying themselves as honest and trustworthy professionals. The plaintiff seeks an order from this Court for the return of RM1 million, together with general and exemplary damages, interest, and costs. THE CAUSE PAPERS [8] The following is the cause paper related to the first defendant's application, as set forth in Enclosure 9: a) Writ of Summons and Statement of Claim dated 30.7.2025 (Enclosure 1 & 2); b) Statement of Defence dated 19.8.2025 (Enclosure 5); c) Notice of Application by the first defendant (Enclosure 9); d) Affidavit in Support sworn by Kek Lye Kheng on 29.9.2025 (Enclosure 11); e) Affidavit in Reply sworn by Dato’ Sia Ah Guan on 22.10.2025 (Enclosure 16); f) Notice of Intention to Use Affidavit by the plaintiff dated 23.10.2025 (Enclosure 17); and g) Notice of Intention to Use Affidavit by the first defendant dated 5.11.2025 (Enclosure 19). [9] The first defendant asserts that – a) The plaintiff has no cause of action against the first defendant under the Investment Agreement dated 18.7.2023 between the plaintiff and Aramas Contract Sdn Bhd. b) If the first defendant is responsible for repaying the plaintiff as a guarantor for Aramas Kontrak Sdn Bhd under the Debt Settlement Agreement dated 17.1.2024, the payment obligation will arise only on 17.1.2027. Consequently, the plaintiff's claim in this case is premature. [10] According to the first defendant, the RM1 million investment by the plaintiff was intended for the AKSB company. APPLICABLE LAWS [11] The legal principles governing the striking out of pleadings are well established. Order 18 Rule 19(1) of the Rules of Court (Amendment) 2012 states: Striking out pleadings and endorsements (O. 18, r. 19) 19.

The Court may at any stage of the proceedings order to be struck out or amended any pleading or the endorsement, of any writ in the action, or anything in any pleading or in the endorsement, on the ground that—

it discloses no reasonable cause of action or defence, as the case may be;

it is scandalous, frivolous or vexatious;

it may prejudice, embarrass or delay the fair trial of the action; or

it is otherwise an abuse of the process of the Court, and may order the action to be stayed or dismissed or judgment to be entered accordingly, as the case may be. [12] The Supreme Court in the case of Bandar Builder Sdn Bhd & Ors v. United Malayan Banking Corporation Bhd [1993] 4 CLJ 7 decided – The principles upon which the Court acts in exercising its power under any of the four limbs of O. 18 r. 19(1) Rules of the High Court are well settled, ft is only in plain and obvious cases that recourse should be had to the summary process under this rule (per Lindley M.R. in Hubbuck v. Wilkinson [1899] 1 QB 86 , p. 91), and this summary procedure can only be adopted when it can be clearly seen that a claim or answer is on the face of it “obviously unsustainable” (Attorney-General of Duchy of Lancaster v. L &N.W. Ry. Co. [1892] 3 Ch. 274 , CA). ISSUES TO BE DECIDED [13] The key issues for this Court to determine are – i. Whether the plaintiff has a valid cause of action against the first defendant; and ii. Whether the plaintiff's claim against the first defendant is premature. ANALYSIS AND FINDING [14] The findings of this Court are as follows – First Issue: Whether the plaintiff has a valid cause of action against the first defendant. [15] This court has examined the first defendant's affidavit in support of the application, as set out in Exhibit A-1 of Enclosure 11. It is evident that the plaintiff entered into a contract with AKSB on 18.7. 2023, as shown below – [16] The agreement identifies Dato Sia Ah Guan by name and his identification card number, thereby confirming the plaintiff's acceptance of the agreement's terms and conditions, among others, as follows – a) Both parties agree that the sum of RM1 million is to be paid by the plaintiff to the venture into the business of Shenzhen TuanBang Internet Technology Co. Ltd. and/or its related group of companies to generate profit or dividends. b) The parties had agreed on the consideration term, which is a fixed dividend rate of 4% per month, payable on the 30th of each calendar month. c) The period of collaboration is six months from the date of the agreement, which lapsed on 17.1.2024. [17] The law on privity of contract is settled. In Boustead Naval Shipyard Sdn Bhd v Dynaforce Corp Sdn Bhd [2015] 1 MLJ 284, the Court held that - [63] The law is clear. A person who is not a party to a contract has no right to sue on a contract (see Kepong Prospecting Ltd & Ors v Schmidt [1968] 1 MLJ 170 (PC); [1967] 2 PCC 465 (PC); and s 2(d) of the Contracts Act 1950; Oversea Chinese Banking Corporation Ltd v Woo Hing Brothers (M) Sdn Bhd [1992] 2 MLJ 86 (HC); and Badiaddin bin Mohd Mohidin & Anor v Arab Malaysian Finance Bhd [1998] 1 MLJ 393 (FC)). … [70] As an established principle of contract law, the common law doctrine of privity of contract stands for the simple proposition that, ‘no one but the parties to a contract can be bound by it or entitled under it’ (Greenwood Shopping Plaza Ltd v Beattie [1980] 2 SCR 228, at p [229]. [18] Based on the above principles and contemporaneous documents, this Court finds that the first defendant is not a party to the contract. The agreement is binding only on AKSB and the plaintiff. Second Issue: Whether the plaintiff's claim against the first defendant is premature. [19] After the agreement lapsed, the plaintiff and the first defendant entered into a debt settlement agreement, as shown in Exhibit A-2 of Enclosure 11. [20] This Court accepted the first defendant's explanation that the debt settlement agreement was entered into on 17.1.2024, not 17.1.2023. It is also reasonable to conclude that the debt settlement agreement existed only after the date of the investment agreement and not before that date. [21] The main term and condition of the debt settlement agreement is to set a time period for the repayment of the investment sum paid by the plaintiff. Under the debt settlement agreement, the first defendant undertakes to pay the plaintiff the sum of RM1,100,000.00 within 3 years from the date of the agreement. [22] The plaintiff and the first defendant further agreed that the plaintiff may demand payment of the entire sum or the outstanding balance and may commence legal action if the first defendant is unable to settle the full amount within the stipulated period. It is also clear that the first defendant's role is limited to that of a guarantor under the debt settlement agreement. [23] This Court also finds that there were written notes at the bottom of the debt settlement agreement, dated 17.1.2024, which was signed by the plaintiff and the first defendant. The notes indicated a further agreement that the debt settlement agreement is between the plaintiff and AKSB, with the first defendant acting as guarantor. [24] In the Affidavit in reply sworn by the plaintiff, which is three pages, the plaintiff does not explain the Debt Settlement Agreement referred to by the first defendant. The plaintiff also did not dispute the existence of the agreement. [25] Further, in examining the second issue above, this Court refers to the statement of defence, which pleaded as follows – Dengan lanjut, secara alternatifnya juga, sekiranya Defendan Pertama adalah terikat di bawah Debt Settlement Agreement bertarikh 17-1 2024, untuk membayar Plaintif jumlah wang sebanyak RM1,100,000.00 tersebut, adalah ditegaskan bahawa tuntutan Plaintif dalam tindakan ini adalah suatu yang bersifat pra-matang memandangkan bahawa berdasarkan kepada klausa 2 Debt Settlement Agreement tersebut menyatakan bahawa bayaran sebanyak RM1,100,000.00 adalah untuk dijelaskan kepada Plaintif dalam tempoh 3 tahun dari tarikh perjanjian tersebut yang akan tamat tempoh pada 16-1-2027. Maka, sebarang tuntutan terhadap wang berjumlah RM1,100,000.00 tersebut adalah untuk dibuat oleh Plaintif selepas dari tarikh 16-1-

[26] This court shall recognise the freedom of the parties to execute the contractual terms to which they are bound. The Federal Court in the case of Merita Merchant Bank Singapore Ltd v Dewan Bahasa dan Pustaka [2018] supp MLJ 33 on page 44 decided as follows - It is trite that parties are free to enter into a contract with terms and conditions as they deem fit and these terms and conditions are binding on the parties who have in the first place agreed to be bound by it… It was a well-established principle sanctioned by the doctrine of sancity of contract that parties who make agreement must adhere to their terms. [27] This court finds that the terms of the Debt Settlement Agreement are clear, straightforward, and unambiguous, requiring no complex interpretation. Accordingly, this court holds that the plaintiff’s cause of action against the defendant accrued only after 16.1.2027. It is further determined that the Writ of Summons and Statement of Claim are premature against the first defendant. CONCLUSION [28] Based on the foregoing, this Court hereby allows Enclosure 9 and orders the costs in the amount of RM10,000.00. Dated on 16 February 2026 Signed ………………………………………. Hazizah binti Kassim Judicial Commissioner Family High Court (2) Shah Alam, Selangor

For the Plaintiff : Keppy Wong Khai Pun dan Choong Jing Yen Tetuan Keppy Wong & Associates (Wilayah

For the Defendants : Dinesh Nandrajog dan Khairul Bariah bt Kharuddin Tetuan Nandrajog (Shah Alam, Selangor)