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1 DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN KUALA LUMPUR, MALAYSIA (BAHAGIAN DAGANG) GUAMAN NO: WA-22NCC-114-03/2019 ANTARA GAN HAI TOH (No K/P: 650314-04-5223) ... PLAINTIF DAN SEACERA GROUP BERHAD (No. Syarikat: 163751-H) ... DEFENDAN DAN TERAS SARI RESOURCES SDN BHD … PIHAK KETIGA (No. Syarikat: 743876-W) JUDGMENT A. Introduction [1] This suit was filed by the plaintiff to seek the repayment of a loan he had allegedly given to the defendant. The defendant denied receiving the loan, claiming instead that the loan was given by the plaintiff to the S/N YAJ3DkVsvUavcpg8TeO4mw third party. Consequently, the defendant filed third party proceedings, seeking an indemnity or contribution against the third party for any amount awarded by the court in respect of the plaintiff’s claim. [2] After a full trial, the court dismissed the plaintiff’s claim. With the dismissal of the claim, the third party proceedings by the defendant became redundant and was also dismissed. B. Background Facts [3] The plaintiff alleged he had provided a loan to the defendant in the sum of RM5,000,000. He claimed to have provided the loan via a cheque dated 20 October 2017. It is to be noted that the cheque was issued to the third party, and not to the defendant. [4] The plaintiff’s case is that: a. The defendant agreed to repay the loan, together with a sum of RM500,000, as compensation for the plaintiff’s loss of opportunities in providing the loan. b. The defendant had issued a post-dated cheque dated 20 January 2018, for the amount of RM5,500,000 to the plaintiff (“Defendant’s Cheque”). The Defendant’s Cheque was issued to repay the loan. S/N YAJ3DkVsvUavcpg8TeO4mw stopped when the plaintiff attempted to deposit it on 14 September 2019. significantly from that of the plaintiff’s. The defendant claimed that the loan of RM5,000,000 was given by the plaintiff to the third party, and not to the defendant, and that this loan arrangement is set out in an agreement being arranged, the defendant’s wholly-owned subsidiary, Seacera Builders Sdn Bhd (“Seacera Builders”) was negotiating with LT Century Development Sdn Bhd and LTC Holdings Sdn Bhd (collectively, the “LTC Group”), to purchase 70% of shares in the third party from the LTC Group. as the holding company of Seacera Builders, to provide a cheque in the sum of RM5,500,000 to guarantee the loan given by the plaintiff to the defendant claimed it informed the plaintiff and the third party that it did not [5] The plaintiff claimed the loan remains unpaid, as the cheque was This suit is a claim for the loan. [6] The version of events put forward by the defendant differs executed between the plaintiff and the third party (“Loan Agreement”). [7] It is the defendant’s case that the Defendant’s Cheque was issued to guarantee the loan provided by the plaintiff to the third party. [8] This guarantee came about, as around the time that the loan was [9] The defendant claimed that the plaintiff requested the defendant, third party. The Defendant’s Cheque was issued for this purpose. [10] When the sale of the third party’s shares did not materialise, the wish to continue to guarantee the loan. S/N YAJ3DkVsvUavcpg8TeO4mw [11] The defendant also claimed that the loan of RM5,000,000 had been re-paid to the plaintiff on 11 April 2018. C. Issues and Considerations [12] The highly disputed background facts set out above give rise to three main issues that must be determined by this court: a. Whether the loan of RM5,000,000 was given by the plaintiff to the defendant or the third party; b. Whether the loan had been repaid to the plaintiff; and c. If the loan had been repaid, whether the plaintiff is entitled to the amount of RM500,000. Issue 1: Was the loan given to the defendant or the third party? [13] To answer this question, I relied on the Loan Agreement, which is the only document evidencing the loan. The Loan Agreement is undated and unstamped, but was signed by the plaintiff and representatives of the third party. [14] The Loan Agreement provides for the following: a. An acknowledgment by the third party that it had received RM5,000,000, being a friendly loan lent by the plaintiff without any interest; and S/N YAJ3DkVsvUavcpg8TeO4mw b. A covenant by the third party to repay the RM5,000,000 in full by 19 January 2018. [15] It is to be noted that neither party who signed the Loan Agreement denied signing the document. With documentary evidence proving the loan, the answer to this question is clear, which is that the loan of RM5,000,000 was given by the plaintiff to the third party, and not to the defendant. [16] Further, the witness of the third party, Md Almee Abdul Manan (“TPW-2”) admitted to receiving a loan of RM5,000,000 from the plaintiff. The following was set out in the witness statement of TPW-2: “3. Bolehkah kamu menjelaskan hubungan antara Plaintif dan Pihak Ketiga? Pihak Ketiga pernah meminjam wang sebanyak RM5,000,000-00 daripada Plaintif (“Pinjaman tersebut”) atas dasar kesahabatan (friendly loan) di mana PIhak Ketiga telah pun membayar balik kesemua Pinjaman tersebut kepada Plaintif pada sekitar April 2018.” [17] In contrast to the documentary and oral evidence which show that the loan was given to the third party, the plaintiff did not provide any evidence to show that the loan was given to the defendant. [18] Instead, the plaintiff put forward two main allegations. Firstly, he alleged that the managing director of the defendant, Zulkarnin Ariffin S/N YAJ3DkVsvUavcpg8TeO4mw but had requested for the cheque for the loan to be issued to the third party. The plaintiff claimed that he acted on the verbal request of DW-1 because “I trusted him. He is my good friend. We’ve known each other such a significant amount of money as a loan to the defendant, a public-listed company, based only on a verbal request. If a loan was in fact provided and the defendant had intended to be liable for the loan, there none. The existence of the Loan Agreement also disproves the plaintiff’s was involved in arranging the loan. There is no evidence put forward by the plaintiff to support the plaintiff’s story. Further and in any event, I do not see how the defendant’s role in arranging the loan, if at all, could my finding that the loan was given by the plaintiff to the third party, and third party, is also consistent with evidence on payment made by LTC since 2001” (line 1, page 11 of the notes of evidence). [19] I find it highly improbable that the plaintiff would have provided would likely have been a trail of documents evidencing the loan. There is version of events. [20] The second allegation raised by the plaintiff is that the defendant equate to it being liable for payment of the loan. [21] Taking into account all available evidence before this court, it is not to the defendant. Issue 2: Has the loan been repaid? [22] My finding on the first issue, namely that the loan was given to the (“DW-1”), had verbally asked for RM5,000,000 as a loan to the defendant, S/N YAJ3DkVsvUavcpg8TeO4mw Holdings Sdn Bhd, a shareholder of the third party, to the plaintiff. This payment was made on 11 April 2018, for the amount of RM5,000,000. [23] The third party confirmed that the payment was made for the purpose of repayment of the loan provided by the plaintiff to the third party. [24] The plaintiff admitted receiving the RM5,000,000 from LTC Holdings Sdn Bhd. He explained that the amount was paid for the plaintiff to agree to delay depositing the Defendant’s Cheque. The plaintiff’s explanation is unsupported by any evidence. [25] The plaintiff’s elaborate explanation of his discussions with DW-1 which led to the payment of RM5,000,000 by LTC Holdings Sdn Bhd to him, is set out in his witness statement. It began with his explanation that DW-1 had asked him not to bank in the Defendant’s Cheque. The plaintiff’s explanation in his witness statement continued as follows: “Q26 : What happened after that? A : He told me to give him a few days to sort out the problem and thereafter I could bank in the said cheque. I agreed to his request. After a few days, I called him up and he kept on pleading with me to postpone the encashment of the cheque for another few more days. It went on for many times and he kept on breaking his promises. I was getting very impatient and told him that I would give him last chance until end of January 2018 to withhold the said cheque. S/N YAJ3DkVsvUavcpg8TeO4mw Q27 : What happened after that ? A : Just about before end of January 2018, Encik Zul telephoned me and told me that he had met up with one of the shareholders of the Third Party namely LTC Holdings Sdn. Bhd. to demand for the repayment of the RM5 million loan given by the Defendant to 3rd Party so that the Defendant could pay me back the loan given by me to them. LTC Holdings Sdn. Bhd. told him that they were willing to pay an additional RM5 million to me if I was willing to delay the encashment of the said Defendant’s cheque of RM5.5 million to end of August 2018 Q28 : What was your reaction ? A : I was curious and surprised why LTC Holdings Sdn. Bhd. were willing to pay of RM5million just to delay my encashment of the Defendant’s cheque and I asked Encik Zul the reasons. Q29 : Did Encik Zul tell you the reason ? A : Yes. He told me that LTC Holdings Sdn. Bhd. informed him that since the 3rd Party had secured the project to upgrade the federal road from Bandar Pekan to Kg Sungai Miang worth about RM340 million and the profit generated form this project would be huge, LTC Holdings S/N YAJ3DkVsvUavcpg8TeO4mw Sdn. Bhd. could easily pay the said extra RM5million. At that moment, the 3rd Party did not have the RM5million to repay back the because the 3rd Party had used all their funds to lobby for the said project. Encik Zul also told me that LTC Holdings Sdn. Bhd. appreciated the help that I was willing to loan the Defendant the said RM5million which the Defendant could then loaned the same to the 3rd Party and this assistance by me really helped the 3rd party to secure the said project. This is another reason why LTC Holdings Sdn. Bhd. was willing to pay me the additional RM5million for the extension.” (emphasis added) [26] No documentary evidence was provided to support the explanation. I found it unlikely for an amount as significant as RM5,000,000 to have been paid by LTC Holdings Sdn Bhd to the plaintiff as a condition imposed by the defendant for the plaintiff to withhold the Defendant’s Cheque. The plaintiff’s explanation is neither probable nor logical. [27] Thus, it is my considered view that on the balance of probabilities, the payment of RM5,000,000 by LTC Holdings Sdn Bhd on 11 April 2018 was to pay the loan from the plaintiff to the third party. [28] The payment of the loan is also consistent with the defendant’s narrative on the issuance of the Defendant’s Cheque, which is that the S/N YAJ3DkVsvUavcpg8TeO4mw cheque was issued to guarantee the loan from the plaintiff to the third party. [29] With the loan having been paid, the liability of the defendant as the guarantor of the loan is also discharged. This is stipulated in section 87 of the Contracts Act 1950: “The surety is discharged by any contract between the creditor and the principal debtor, by which the principal debtor is released, or by any act or omission of the creditor, the legal consequence of which is the discharge of the principal debtor.” Issue 3: Is the plaintiff entitled to the amount of RM500,000? [30] The plaintiff is also claiming RM500,000 for opportunities lost for the RM5,000,000 that the plaintiff had lent to the defendant. Having found that the loan was given to the third party and not the defendant, I found this claim to be without basis. [31] Further, the plaintiff did not provide any evidence of his loss in this regard. D. Decision [32] Taking into account the factual and legal considerations set out above, I found that the plaintiff had failed to prove its case. I dismissed the plaintiff’s claim, with costs. S/N YAJ3DkVsvUavcpg8TeO4mw [33] In view of my decision on the plaintiff’s claim, I considered the defendant’s claim against the third party to have become redundant, and consequently also dismissed the claim. Dated 25 February 2022 - sgd - Adlin binti Abdul Majid Judicial Commissioner High Court of Malaya Commercial Division (NCC6) Kuala Lumpur Counsel: Plaintiff : K. Goik of Messrs. Goik, Ramesh & Loo Defendant : Shamsul Bahrin Abdul Manaf (together with Maizura Mohamed Amin) of Messrs. Mohanadass Partnership Third Party : Jennifer Ang of Messrs. Davis & Low S/N YAJ3DkVsvUavcpg8TeO4mw