Kharisma Wira Sdn Bhd v 1. ) Ace Credit (M) Sdn. Bhd. (WA-22NCC-696-09/2023)

KHARISMA WIRA SDN BHD …PLAINTIFF (Company No.: 199201015390 (246893-K))

ACE CREDIT (M) SDN. BHD (Company No.: 200301003436[605856-V])

CHOONG CHEE MENG (IC No.: 610726-08-5743)

CHANG AI NEE (IC No.: 710422-10-5248) …DEFENDANTS

This is a trial heard over 1 day on 14-04-2025. Oral submissions by counsel were held before me on 16-07-2025. I delivered decision on the same day in favour of the plaintiff.

My broad grounds were that I find that the plaintiff who is an investor has proven its case against the 1st defendant [in liquidation] [“Ace Credit”], which is the company that the plaintiff had invested in, and against the 2nd defendant Choong Chee Meng (IC No.: 610726-08- 5743) and 3rd defendant Chang Ai Nee (IC No.: 710422-10-5348) who had guaranteed the return of the Investment Sum and payment of the Investment Target Return.

I had dismissed the three defendants’ defence that the Investment Agreement dated 02-05-2019 [“Agreement”] is a moneylending agreement and contrary to the Moneylenders Act 1951 [“MA 1951”].

Consequently, I had allowed the Statement of Claim at paragraph 19 prayers [i] for the return of the Invested Sum of RM 10,500,000 and prayer [ii] for payment of the Investment Target Return of RM 1,890,000.

I had also allowed interest on the RM 10,500,000 at 5% pa from 14- 08-2023 till payment and interest on the RM 1,890,000 at 5% pa from 01-01-2023 till payment.

I had further awarded costs of RM 10,000 to be paid by Ace Credit to the plaintiff subject to allocatur and costs of RM 15,000 to be paid by the 2nd and 3rd defendants to the plaintiff subject to allocatur.

The 2nd and 3rd defendants have filed an appeal to the Court of Appeal on 11-08-2025.

This appeal is frivolous and devoid of merits. The same defendants and/or related company Ace Holdings Berhad had been sued in many suits by similar investors based on the same Investment Agreement and Guarantee before me. Judgments had been entered against Ace Credit, Ace Holdings Berhad and the 2nd and 3rd defendants as guarantors and reported as- i. Datin Sri Aidarahmi bt Ismail v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee [2025] CLJU 602, HC; ii. Syed Gamal bin Syed Kechik Al-Bukhary v Ace Credit (M) Sdn Bhd & Ors [2024] MLJU 3525, HC; iii. Dato Seri Tengku Nerang Putra & Ors v Ace Holdings Berhad & Choong Chee Meng and Chang Ai Nee [2024] CLJU 3227, HC; iv. Mohd Farid Mohamed Sangido v Ace Credit (M) Sdn Bhd & Chang Ai Nee and Choong Chee Meng [2025] CLJU 603, HC; and v. Che Normah Bt Che Kerma v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee in Kuala Lumpur High Court Suit No: WA-22NCC-503-10/2022 where judgment was allowed against the two guarantors only, as Ace Credit was in judicial management at that material time, and affirmed by the Court of Appeal in Appeal No.: W- 02(IM)(NCC)-976-06/2023 on 10-07-2024 based on the Broad Grounds.

These are my Grounds of Judgment.

The plaintiff invested RM 10.5 million with Ace Credit via the Agreement. The period of investment was 5 years with a maturity date of 01-05-2024 and a promised target return of 18%. [See pages 4 - 19 Bundle B1(Enclosure 65)].

In consideration of the plaintiff’s investment in Ace Credit, the 2nd and 3rd defendants had irrevocably and unconditionally as directors of Ace Credit executed a Directors’ Personal Guarantee dated 02- 05-2019 (“Guarantee”) as can be seen in Appendix 2 to the Agreement. [See page 16 Bundle B1(Enclosure 65)].

By this Guarantee, pursuant to Clause 1, the 2nd and 3rd defendants undertook to guarantee and ensure the full performance of all obligations and undertakings of Ace Credit under the Agreement.

Ace Credit could not make payment of the Investment Target Return for the period of 01-01-2022 to 31-12-2022 amounting to RM 1,890,000. [See Appendix 1 of the Agreement – page 15 / Bundle B1).

The plaintiff under Clause 8.01 in the Agreement issued a letter of demand dated 27-07-2023 to Ace Credit and the 2nd and 3rd defendants giving (7) days to remedy the breach. [Refer to B1 pages 249 to 251].

As a result of Ace Credit’s failure to remedy the breach, the plaintiff issued a termination notice pursuant to Clause 8.02 to Ace Credit and the 2nd and 3rd defendants dated 14-08-2023. [Refer to B1 (Enclosure 65) page 252].

The plaintiff filed this suit in 2023 against the defendants for repayment of the Invested Sum of RM 10,500,000 and for payment of the Investment Target Return of RM 1,890,000.

Ace Credit went into Liquidation on 14-03-2024 wherein Andrew Heng and Lim Litt from Baker Tilly Insolvency PLT were appointed as Liquidators.

The plaintiff called PW1 Datin Sri Aidarahmi Binti Ismail as witness.

The defendants called DW1 Lim Litt and DW2 Choong Chee Meng.

After the conclusion of testimonies, parties filed written submissions except for Ace Credit. In fact, counsel for Ace Credit was absent from the oral submissions’ proceedings. I can only surmise Ace Credit has no objection to the plaintiff’s claim. Defences raised by the 2nd and 3rd defendants

The 2nd and 3rd defendants raised the following defences in their written submission-i. The plaintiff’s claim must be dismissed against the 2nd and 3rd defendants as the plaintiff has failed to discharge its burden of proof to establish its pleaded claim. The 2nd and 3rd defendants rely on section 4.03 (F) of the Agreement. [See Enclosure 82 WS paragraphs 6.4 and 8]; ii. Section 3.01 of the Agreement shows that the Agreement is a moneylending transaction and the plaintiff entered into the Agreement with the intention and purpose of moneylending especially since the plaintiff [sic] is a licensed moneylender. [See Enclosure 82 WS paragraph 17]. The two Issues

I will now proceed to consider the two issues. Issue [1] – whether the plaintiff has proven its pleaded claim

In my view, the plaintiff has proven its pleaded claim. Under the Agreement in sections 2.01 and 2.03 read with Appendix 1, the defendants had agreed to pay the Investment Target Return of RM 1,890,000 by 31-12-2022. The defendants failed to pay.

Under the Agreement in sections 8.02 and 8.03, the defendants had agreed to repay the Invested Sum of RM 10,500,000 upon any default. The defendants failed to pay.

The 2nd and 3rd defendants rely on section 4.03 (F) of the Agreement. [See Enclosure 82 Written Submission paragraphs 6.4 and 8].

Section 4.03 of the Agreement merely states that the plaintiff agrees and understands the financial risks associated with investment. But this acknowledgment of risk does not imply that the Investment Target Return or repayment of the Invested Sum are contingent upon the financial performance of Ace Credit. For section 4.03 refer to B1 (Enclosure 65) - page 8.

Section 4.03 of the Agreement does not override sections 2.01 and 2.03 of the Agreement which expressly provide that the Investment Target Return are to be paid annually and the Invested Sum are to be repaid in full at the end of the investment period.

The same defence was raised by the defendants in other suits and was rejected by the courts. [See the case of Datin Sri Aidarahmi bt Ismail v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee [2025] CLJU 602 at [30, 38, 39], HC, and Syed Gamal bin Syed Kechik Al-Bukhary v Ace Credit (M) Sdn Bhd & Ors [2024] MLJU 3525 at [17 – 21], HC].

In conclusion, I find no merits in this defence of the 2nd and 3rd defendants. Issue [2] – whether the Agreement is a moneylending transaction

I hold the Agreement is not a moneylending transaction.

The 2nd and 3rd defendants submit in Enclosure 82 Written

Section 3.01 of the Agreement shows that the Agreement is a moneylending transaction and the plaintiff entered into the Agreement with the intention and purpose of moneylending especially since the Plaintiff is a licensed moneylender.

The plaintiff also consented that the money that the plaintiff lent to D1 may be utilized for moneylending purposes.

Fact of the matter is the plaintiff knew that the plaintiff entered into a moneylending agreement with D1 as the plaintiff’s understanding clearly shows that the plaintiff was to lend a sum of money i.e. RM 10,500,000.00 to D1 with an interest of 18% and in return/upon the maturity date of the Agreement, the plaintiff shall receive RM 1,890,000.00 (principal sum + interest of 18%). This is the concept of a moneylending agreement and the plaintiff has knowledge of the same.

I reject the above submissions. The Agreement states clearly that it’s an Investment Agreement whereby the investor is entitled to a fixed return per year for 5 years and repayment of his Investment Sum at the end of the 5-year period.

This is different from a moneylending whereby a lender lends money with interest charged. By way of analogy, the case before me is similar to a bank agreeing to give fixed interest annually to a customer who deposits money with the bank for a fixed period. At the end of the period, the bank has to repay the deposit sum to the customer.

The fact that Ace Credit is foolish enough to agree to pay a high fixed interest [knowing it’s an unsustainable way of doing business] and a customer is equally foolish enough to accept, does not turn a legitimate deposit agreement into a moneylending agreement. Similarly, if a bank agrees to give high fixed interest, this fact alone does not turn a deposit agreement into a moneylending agreement.

The Court of Appeal in Perbadanan Kemajuan Negeri Selangor v Selangor Country Club Sdn Bhd [2016] 8 CLJ 211, CA held as follows: “[34] Accordingly, when a court is called upon to interpret a document, it looks at the language. If the language is clear and unambiguous and applies accurately to existing facts, it shall accept the ordinary meaning; for the duty of the court is not to delve into intricacies of the human mind to disclose one’s undisclosed intention, but only to take the meaning of the words used by him, that is to say his expressed intentions.” Admission by the 2nd defendant

The 2nd defendant, in fact, when being cross-examined by the plaintiff’s solicitors during the trial, had affirmed that the agreement was indeed an investment agreement: WAN Terima kasih, Yang Arif. Dato’ Choong, saya peguamcara Plaintif. Untuk tuntutan kes Plaintif pada hari ini, saya ada beberapa soalan untuk ditanyakan dan mendapat pengesahan daripada Dato’ Choong, ya. Rujuk kepada soalan no. 3 dan juga jawapan no.3 Dato’ dalam penyataan saksi yang Dato’ baru tandatangan tadi, boleh Dato’ sahkan di sini bahawa perjanjian diantara Plaintif dan Defendan di dalam kes ini adalah sebahagian daripada perjanjian-perjanjian pelaburan Dato’ maksudkan di perenggan A3 tadi? DW2 Ya, Yang Arif. [Refer to Notes of Proceedings (Enclosure 78) – page 42] Presumption under section 10 OA of the MA 1951

I also hold that the presumption under section 10 OA of the MA 1951 does not assist the defendants. Section 10 OA reads as follows: Presumption as to the business of moneylending 10 OA. Where in any proceedings against any person, it is alleged that such person is a moneylender, the proof of a single loan at interest made by such person shall raise a presumption that such person is carrying on the business of moneylending, until the contrary is proved. [Emphasis added]

The case before me is not a loan agreement. The plaintiffs did not lend monies to Ace Credit. In fact, it is Ace Credit which is the licensed moneylender as stated and represented in the Agreement at Recital A. And at Recital B it is stated that Ace Credit agreed on the plaintiffs investing in Ace Credit.

I note the defence of moneylending raised by the defendants here was raised by them in other suits and was rejected by the courts in- i. Datin Sri Aidarahmi bt Ismail v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee [2025] CLJU 602 HC at [50 - 51]; and ii. Che Normah Bt Che Kerma v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee in Kuala Lumpur High Court Suit No: WA-22NCC-503-10/2022 at [42] and affirmed by the Court of Appeal in Appeal No.: W-02(IM)(NCC)-976- 06/2023 on 10-07-2024 based on the Broad Grounds.

The defence of moneylending raised by the defendants here were in fact dropped by the 2nd and 3rd defendants in an earlier suit. [See Syed Gamal bin Syed Kechik Al-Bukhary v Ace Credit (M) Sdn Bhd & Ors [2024] MLJU 3525 HC at [15],

For the reasons above, I allow the Statement of Claim at paragraph 19 prayers [i] for the return of the Invested Sum of RM 10,500,000 and prayer [ii] for payment of the Investment Target Return of RM 1,890,000.

I also allow interest on the RM 10,500,000 at 5% pa from 14-08- 2023 till payment and interest on the RM 1,890,000 at 5% pa from 01-01-2023 till payment.

I further award costs of RM 10,000 to be paid by Ace Credit to the plaintiff subject to allocatur and costs of RM 15,000 to be paid by the 2nd and 3rd defendants to the plaintiff subject to allocatur. Dated: 19th August 2025 …………(signed)…………. Leong Wai Hong Judge High Court of Malaya Kuala Lumpur (NCC 6) Counsel for plaintiff: Wan Sarimah Wan Husain, Muhammad Syahmi Akif bin Jamil and Akmal Khuzairi Bin Masri Wan Sarimah & Co (Kuala Lumpur) Counsel for 1st defendant: Loo Man Keith and Lim Chun Yen Peter Ling & Van Geyzel (Kuala Lumpur) Counsel for 2nd defendant: Shankar Govinth and Nabilah Arysa Shankar Govinth (Kuala Lumpur) CASES REFERRED TO: 1) Che Normah Bt Che Kerma v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee. 2) Datin Sri Aidarahmi bt Ismail v Ace Credit (M) Sdn Bhd & Choong Chee Meng and Chang Ai Nee [2025] CLJU 602, HC. 3) Dato Seri Tengku Nerang Putra & Ors v Ace Holdings Berhad & Choong Chee Meng and Chang Ai Nee [2024] CLJU 3227, HC. 4) Mohd Farid Mohamed Sangido v Ace Credit (M) Sdn Bhd & Chang Ai Nee and Choong Chee Meng [2025] CLJU 603, HC. 5) Perbadanan Kemajuan Negeri Selangor v Selangor Country Club Sdn Bhd [2016] 8 CLJ 211, CA. 6) Syed Gamal bin Syed Kechik Al-Bukhary v Ace Credit (M) Sdn Bhd & Ors [2024] MLJU 3525, HC. LEGISLATION REFERRED TO: 1) Moneylenders Act 1951, section 10 OA.