G Venture Advisory Sdn Bhd v 1. ) Tebook House Sdn Bhd (BA-22NCC-243-12/2024)

TEBOOK HOUSE SDN BHD (No. Syarikat: 1492921-K)

NOOR JEEHAN BINTI ADAM (No. K/P: 811112-01-5290) …DEFENDAN-DEFENDAN JUDGMENT Introduction [1] This is an application by the Plaintiff in Enclosure 10 to enter Summary Judgment against the Defendants pursuant to Order 14 of the Rules of Court 2012. [2] The Plaintiff’s claim is premised on an Investment Agreement entered into between the Plaintiff and the First Defendant and a Personal Guarantee provided by the Second Defendant (the director of the First Defendant). The Predominant Issue [3] As the Defendants have not raised any procedural objections, the principal issue in this summary judgment application is whether the Defendants have raised any issue or question in dispute which ought to be tried or that there ought for some other reason to be a trial of the claim within the meaning of Order 14 rule 3 of the Rules of Court 2012. The Case for the Plaintiff [4] The Plaintiff averred to the what it considered as the undisputed facts that the Plaintiff and the First Defendant had entered into an Investment Agreement dated 6 June, 2024 and that the Second Defendant had signed a personal guarantee dated 6 June, 2024. [5] Relying on the authorities of Andrew Lee Siew Ling v United Overseas Bank (Malaysia) Bhd [2013] 1 AMR 573; [2013] 1 CLJ 24; [2013] 1 MLJ 449; [2013] 1 MLRA 547 and Malayan Banking Berhad v Boo Hock Soon @ Bo Choo Soon [2013] 1 AMCR 19; [2012] 1 LNS 971; [2013] 2 MLJ 843; [2013] 2 MLRA 387 (“Boo Hock Soon”), it was contended by the Plaintiff that the Second Defendant is liable for the amount owed by the First Defendant to the Plaintiff. [6] On the suitability of invoking the summary procedure under Order 14, the Plaintiff submitted as follows:

Adalah dihujahkan bahawa Defendan–Defendan sekali telah mengakui keberhutangannya terhadap Plaintif pada perenggan 10 Pembelaan Defendan namun membuat kenyataan bercanggah berkenaan kononnya surat–surat permohonan cadangan penyelesaian yang dihantar kepada Plaintif seperti yang telah diperincikan pada perenggan 12 Afidavit Sokongan Plaintif terpaksa dikeluarkan kerana Defendan Kedua seringkali diugut dan/atau dipaksa oleh wakil Plaintif.

Defendan–Defendan sekali lagi secara ‘afterthough’ membuat dakwaan kosong bahawa kononnya atas desakan Plaintif Defendan–Defendan terpaksa mengeluarkan surat – surat cadangan penyelesaian kepada Plaintif seperti yang diperincikan pada perenggan 12 Afidavit Sokongan Plaintif walhal perkara ini tidak dapat dibuktikan dengan jelas dan terperinci oleh Defendan–Defendan sama ada pada Pembelaan Defendan–Defendan mahupun Afidavit Jawapan Defendan–Defendan.

Plaintif seterusnya berhujah bahawa Defendan–Defendan hanya cuba untuk melengah–lengahkan masa dengan menimbulkan dan membagkitkan isu–isu yang tidak berasas dan tidak relevan dengan membuat penyataan ‘afterthough’ dan penafian kosong semata–mata terhadap tuntutan Plaintif. [7] Based on the provision in section 17 of the Evidence Act 1950 and cases such as Binary Force Sdn Bhd v Lembaga Pelabuhan Johor [2009] AMEJ 0018; [2009] 1 CLJU 313; [2009] MLJU 296; [2009] 8 MLRH 778, Boo Hock Soon and Intisari Utama Sdn Bhd v Pastpresentfuture Sdn Bhd [2024] AMEJ 2605; [2024] CLJU 2617; [2024] MLJU 3037, it was the Plaintiff’s submission that this is a proper case for summary judgment to be entered in favour of the Plaintiff. [8] In reply to the Defendants’ submissions, the Plaintiff maintained that that the Investment Agreement had been validly executed by the First Defendant through the affixation of its common seal and the signature of its authorised representative. [9] The Plaintiff contended that the absence of stamping or delivery of the Investment Agreement did not affect its enforceability, as the essential elements of a valid contract were present. Reference was made to section 10 of the Contracts Act 1950 in support of this position. [10] The Plaintiff further submitted that the Defendants’ argument on the purpose of stamping was misconceived and unsupported by authority. Relying on the Federal Court decision in Malayan Banking Bhd v Agencies Service Bureau Sdn Bhd & Ors [1982] CLJ Rep 217; [1982] 1 MLJ 198; [1981] 1 MLRA 152, the Plaintiff argued that the purpose of stamp duty legislation is fiscal, and that an unstamped document does not become void but may be rendered admissible in court upon payment of the appropriate duty and penalty. [11] The Plaintiff also pointed out that the Defendants had expressly acknowledged receipt of the investment sum and had utilised the funds for the benefit of the First Defendant, as recorded in their Defence, affidavits, and written submissions. The Plaintiff argued that the manner in which the funds were later applied by the Defendants, or any issues arising between the Defendants and third parties such as Kopenas Berhad or suppliers, was not relevant to the Plaintiff’s claim. [12] The Plaintiff emphasised that the Investment Agreement imposed clear obligations on the Defendants with respect to the investment sum, and that no part of the Investment Agreement made repayment conditional upon the completion of any underlying project. The Plaintiff also noted that the contractual term imposing late payment interest of 5% was clearly stated in the Agreement and acknowledged by the First Defendant in its letters proposing settlement, which were exhibited in the Plaintiff’s supporting affidavit. [13] In conclusion, the Plaintiff submitted that the Defendants had failed to raise any credible or bona fide defence to the claim, relying instead on bare assertions and unsupported allegations such as duress in signing the Agreement or the guarantee, and in issuing the settlement proposals. These, the Plaintiff contended, were no more than attempts to evade liability. The Defendants’ Contentions [14] At the commencement of the hearing of this application, the Defendants informed the Court that they had obtained leave to issue a Third-Party Notice, which was served on 5 May, 2025, that is, one day before the hearing of this Notice of Application for summary judgment in Enclosure 10 on 6 May, 2025. On that basis, the Defendants sought a suspension or adjournment of the summary judgment proceedings pending the determination of their Third-Party claim. [15] This Court informed the Defendants that the initiation of Third-Party proceedings does not preclude the Court from proceeding to determine the Plaintiff’s summary judgment application. If the Plaintiff succeeds, the Defendants remain at liberty to pursue their Third-Party claim. Conversely, if the Plaintiff’s application is dismissed, the Court will proceed to give directions for the conduct of the trial, including the Third-Party proceedings. Accordingly, the Defendants’ Third-Party claim does not constitute a valid ground to delay or stay the hearing of the Plaintiff’s application in Enclosure 10. [16] In resisting the Plaintiff’s application for summary judgment under Order 14 of the Rules of Court 2012, the Defendants raise two principal grounds. [17] First, they contended that the investment agreement and personal guarantee relied upon by the Plaintiff are inadmissible for want of stamp duty under section 52(1) of the Stamp Act 1949. They asserted that these instruments have not been duly stamped, and as such, cannot be admitted in evidence unless and until the requisite duty and penalties are paid. In support, the Defendants cited authorities for the proposition that the court may not act upon unstamped instruments. [18] Second, the Defendants submitted that there are bona fide triable issues which warrant a full trial. They deny any liability under the alleged investment scheme and contended that the funds in question were applied towards a genuine project involving the supply of table mats to a third-party cooperative (Kopenas). Any failure of repayment was, according to the Defendants, attributable to circumstances beyond their control, including the conduct of Kopenas. [19] The Defendants further maintained that these factual disputes, including the purpose of the investment, the use of funds, and their alleged representations, ought not be summarily determined. On this basis, they urged the Court to dismiss the application with costs. Analysis and Decision [20] Having considered the parties’ submissions and the affidavit evidence before the Court, this Court is satisfied that the Plaintiff has established a clear and unequivocal entitlement to summary judgment under Order 14 rule 1 of the Rules of Court 2012. [21] The Plaintiff’s claim is founded on a valid written investment agreement, a personal guarantee executed by the Second Defendant, and a subsequent settlement agreement confirming the Defendants’ liability to repay the sum of RM500,000.00. The documents exhibited are clear and unambiguous in their terms. [22] As noted, the Defendants’ attempt to resist summary judgment rests on two principal grounds: the alleged inadmissibility of the investment agreement due to want of stamp duty, and the assertion that there exist triable issues relating to the purpose and performance of the investment. [23] It is this Court’s considered view that neither ground raises a credible or bona fide defence. As to the first, section 52(1) of the Stamp Act 1949 does not render an unstamped document void or incapable of founding a claim. It merely affects admissibility unless or until the requisite duty and penalty are paid. [24] Section 52(1) of the Stamp Act 1949 provides as follows: Instruments not duly stamped inadmissible in evidence

(1) No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having by law or consent of parties authority to receive evidence, or shall be acted upon, registered, or authenticated by any such person or by any public officer, unless such instrument is duly stamped: Provided that –

any such instrument shall, subject to all just exceptions, be admitted in evidence on payment of the duty and the penalty, if any, chargeable in respect thereof under section 43 or 47A; … [25] Commenting on the above erstwhile sections 43 and 37 of the Stamp Ordinance 1949, the Federal Court in Malayan Banking Bhd v Agencies Service Bureau Sdn Bhd & Ors [1982] CLJ Rep 217; [1982] 1 MLJ 198; [1981] 1 MLRA 152 remarked as follows: It is clear that under this section except for certain types of instruments prohibition against admissibility of an instrument on account of not being duly stamped is not an absolute prohibition but conditional on payment of a duty or a penalty, if any, under ss. 43 and 47. The duty and the penalty required to be paid under s. 43 are those in respect of a bill of exchange or cheque or promissory note drawn outside Federation, whilst the duty and the penalty required to be paid under s. 47 are as regards instruments other than those stated in paras. (a), (b) and (c) of subsection

of the section namely:

a bill of exchange, cheque or promissory note drawn or made within the Federation; or

a receipt for money or other property the amount or value of which exceeds twenty dollars; or

a power or letter of attorney for the sole purpose of appointing or authorising a person to vote as proxy at one meeting only of a company or association, Thus, it is clear that as to an instrument falling under any of these three categories the prohibition against admissibility is absolute. Unless it is stamped before or at the time of its execution as provided in s. 41 there is no way in which it could be admitted under proviso (a) to s. 52(1). In other words the prohibition is absolute or goes to the root or validity of the instrument. It is for this reason that in the case of Navaradnam v. Suppiah Chettiar [1973] 1 MLJ 173 no issue was raised or could possibly be raised that a promissory note rejected for lack of stamping should be impounded and admitted on payment of proper stamps. Proviso (a) to s. 52(1) simply does not cover such document. In the present case, however, the guarantee Exh. P2 is not a document which falls under any of the three categories mentioned in subsection (1) of s. 47, and that being the case, Exh. P2 could be admitted in evidence in accordance with proviso (a) to s. 52(1) on payment of a penalty of RM25 under s. 47 of the Ordinance. The purpose of the Stamp Ordinance 1949 is to impose and to collect taxes on legal and commercial documents by compelling these documents to be stamped on pain of being inadmissible. The Ordinance provides that payment of duty can be made before or at the time when documents are executed, and even later except for certain type of documents. The duty must be paid within 30 days of execution or even on a later date when the documents are used provided that an appropriate penalty is paid. Failure to pay the duty or the penalty prevents the use of the instrument. If the use is intended for a judicial proceeding the document is not admissible until the duty or the penalty is paid, unless the document belongs to special categories stated earlier. To ensure that the duty is paid s. 51 imposes an obligation on those whose function is to receive evidence including the Courts to be specially vigilant to see whether a document produced before them is duly stamped or not. If it appears to be unstamped the authority concerned has no choice but to impound the document and admit the same on payment of the necessary duty or penalty under proviso (a) to s. 52(1) and thereafter send the impounded documents to the Collector of Stamp Duty together with the duty or penalty for stamping under s. 53. Because a stamp objection really relates to the need of safeguarding Government revenue, the practice in England regarding an unstamped document is that the Court will admit such document upon payment of the necessary duty or penalty if any, unless of course the lack of stamping goes to the root or the validity of the document itself or the case is a revenue dispute. … [26] The non-payment of stamp duty can be regularised. In any event, this technical objection does not go to the root of the debt. [27] As to the second ground, the Defendants’ affidavit is vague and lacking in material particulars. The arrangement with Kopenas has no bearing on the present claim. [28] The Defendants have not furnished any credible evidence of fraud, misrepresentation, or any legal basis that would negate their contractual obligations. Mere assertions or unexplained failure to perform by a third party are not sufficient to defeat a clear contractual liability, especially where the Second Defendant had furnished a personal guarantee. [29] Accordingly, this Court finds that the Defendants have failed to raise any triable issue. [30] The Plaintiff’s application in Enclosure 10 is allowed with costs. [31] Each of the Defendants is ordered to pay costs of RM2,500 to the Plaintiff. Dated: 1 July, 2025 sgd [CHOONG YEOW CHOY] Judicial Commissioner High Court of Malaya Shah Alam Counsel: Nik Irma Amir binti Nik Kemaruzaman for the Plaintiff (Messrs. T. L. Chen & Co.) Shamilah binti Ab Wahab for the Defendants (Messrs. Sasila Basri & Co.)