Public Bank Berhad v Gan Thian Leong (WA-22NCC-562-08/2023)

BG BETA SDN BHD (Registration No.: 200301005372 [607792-H])

BRUNSFIELD CORPORATION SDN BHD (Registration No.: 199601008015 [380361-M])

DEFENDANTS CIVIL SUIT NO. WA-22NCC-561-08/2023 (Company No.: 196501000672 [6463-H]) CIVIL SUIT NO. WA-22NCC-562-08/2023 (Company No.: 196501000672 [6463-H]) GROUNDS OF JUDGMENT A. Introduction [1] The four actions filed in this court are claims for amounts outstanding pursuant to loan facilities granted by the plaintiff. They involve the same plaintiff, and borrowers in the same group of companies. Therefore, the actions were heard together. [2] The plaintiff filed applications for summary judgment against the defendants, by way of: a. Enclosure 16 in Kuala Lumpur High Court Suit No. 22NCC-559- ; b. Enclosure 23 (against the 1st and 3rd defendants) and enclosure 29 (against the 2nd defendant) in Kuala Lumpur High Court Suit No. 22NCC-560- ; c. Enclosure 7 in Kuala Lumpur High Court Suit No. 22NCC- ; and d. Enclosure 7 in Kuala Lumpur High Court Suit No. 22NCC- (collectively, the ). [3] At the commencement of the hearing, learned counsel for the plaintiff informed the court that the plaintiff is not able to proceed with the summary judgment application against the 1st defendant in Suit 560, in view of pending judicial management ( JM ) proceedings involving the 1st defendant. [4] After considering documentary evidence before the court and submissions of learned counsel, the court allowed the Summary Judgment Applications (except against the 1st defendant in Suit 560). The court provided brief reasons for the decision. These are the full grounds of the decision. B. Background Facts The parties [5] As there are multiple parties involved, the parties are referred to in the following manner: a. Public Bank Berhad, the plaintiff in all actions, is referred ublic Bank b. Gan Thian Leong, the defendant in Suit 559 who is also the 3rd defendant in Suit 560 and the defendant in Suit 561 and Suit 562, is referred to as GTL; c. BG Beta Sdn Bhd, the 1st defendant in Suit 560, is d. Brunsfield Corporation Sdn Bhd, the 2nd defendant in Suit 560, is Brunsfield Corporation ; and e. GTL, BG Beta and Brunsfield Corporation are collectively [6] claims are for amounts outstanding pursuant to loan facilities it had granted to the following entities: a. In Suit 559, Brunsfield Oasis Square OS b. In Suit 560, BG Beta; c. In Suit 561, d. In Suit 562, Brunsfield [7] GTL is the guarantor of these loan facilities. Suit 559 [8] In Suit 559, Public Bank is seeking the repayment of amounts outstanding from GTL, pursuant to loan facilities it granted to BOS. GTL is the guarantor of the facilities. [9] Details of the facilities are as follows: a. 17 term loan facilities, with the principal sum of RM66,060,000 granted to BOS BOS st Loan , subject to the terms and conditions stipulated in letters of offer dated 18 May 2012 and 27 November 1st a facility agreement dated 4 December 2012 ( 1st The repayment of 1st Loan Facilities is secured by, inter alia, a letter of continuing guarantee for execution by individual(s) dated 29 November 2012, executed by GTL in favour of Public Bank ( 1st b. 20 term loan facilities, with the principal sum of RM29,465,000 granted to BOS 2nd Loan , subject to the terms and conditions contained in a letter of offer dated 1 September 2nd a facility agreement dated 23 September 2015 ( 2nd FA ). The repayment of the 2nd Loan Facilities is secured by, inter alia, a letter of continuing guarantee for execution by individual(s) dated 23 September 2015 executed by GTL in favour of Public Bank 2nd [10] It is not in dispute that BOS had utilised 1st Loan Facilities and 2nd Loan Facilities . [11] BOS could not meet its repayment obligations under Loan Facilities. Thus, by way of several supplemental letters of offers, Public Bank extended and revised the repayment terms of Loan Facilities, and granted deferments on interest payments. [12] BOS however defaulted in its repayment obligations, and as such, Public Bank recalled Loan Facilities by way of a letter of recall dated 12 May 2023. In the letter of recall, Public Bank demanded from BOS the amounts outstanding under Loan Facilities. A letter of demand dated 12 May 2023 was also issued to GTL as a guarantor of the facilities. BOS and GTL have not paid the amounts outstanding. [13] Thus, Public Bank filed Suit 559 against GTL to seek the amounts outstanding, totalling RM88,268,879.40 as at 11 May 2023, together with interest. Suit 560 [14] In Suit 560, Public Bank is seeking the repayment of amounts outstanding from BG Beta, Brunsfield Corporation and GTL, pursuant to loan facilities it granted to BG Beta . Brunsfield Corporation and GTL are the guarantors of the facilities. [15] a. Three fixed loan facilities, with the principal sums of RM1,603,000, RM962,000 and RM642,000 respectively, 1st subject to the terms and conditions stipulated in a letter of o st Letter of dated 28 March st FAs The repayment of 1st Loan Facilities is secured by, inter alia, letters of continuing guarantee for execution by individual(s) dated 28 March 2007, executed by GTL in favour of Public Bank 1st b. A term loan facility, with a principal sum of RM352,000 2nd Loan Facility subject to the terms and conditions stipulated in a letter of offer dated 11 August 2008 2nd Letter of a facility agreement dated 20 November 2008 2nd FA 2nd Loan Facility is secured by, inter alia, a letter of continuing guarantee for execution by a limited company dated 20 November 2008, executed by Brunsfield Corporation in Corporate Guaran c. A term loan facility, with a principal sum of RM5,108,000 3rd Loan Facility to the terms and conditions stipulated in a letter of offer dated 18 August 2016 3rd a facility agreement dated 26 August 2016 3rd FA 3rd Loan Facility is secured by, inter alia, a letter of continuing guarantee for execution by individual(s) dated 26 August 2016, executed by GTL 2nd Personal [16] It is not in dispute that BG Beta had utilised Loan Facilities. [17] BG Beta defaulted in its repayment obligations, and as such, Public Bank recalled acilities by way of a letter of recall dated 12 May 2023. In the letter of recall, Public Bank demanded from BG Letters of demand dated 12 May 2023 were also issued to Brunsfield Corporation and GTL as guarantors of the facilities. BG Beta, Brunsfield Corporation and GTL have not paid the amounts outstanding. [18] Thus, Public Bank filed Suit 560 against BG Beta, Brunsfield Corporation and GTL, for the following amounts: a. From BG Beta as a borrower under BG Beta Loan Facilities and GTL as a guarantor under st Personal Guarantees nd Personal Guarantee, the amount of RM5,117,130.89 as at 11 June 2023, together with interest; and b. From Brunsfield Corporation as a guarantor under BG Corporate Guarantee, the amount of RM1,415,000 as at 12 May 2023, together with interest. Suit 561 [19] In Suit 561, Public Bank is seeking the repayment of amounts outstanding from GTL, pursuant to a loan facility with the principal sum of RM118,580,000 granted to Subang Mall . GTL is the guarantor of the facility. [20] subject to the terms and conditions stipulated in a letter of offer dated 9 January 2015 Letter a facility agreement dated 25 March 2015 FA secured by, inter alia, a letter of continuing guarantee for execution by individual(s) dated 19 March 2015, executed by GTL in favour of Public [21] Loan Facility. [22] Subang Mall could not meet its repayment obligations under of offers, Public Bank extended and revised the repayment terms of payments. [23] Subang Mall however defaulted in its repayment obligations, and letter of recall dated 12 May 2023. In the letter of recall, Public Bank demanded from Subang Mall the amounts outstanding under Subang Loan Facility. A letter of demand dated 12 May 2023 was also issued to GTL as a guarantor of the facility. Subang Mall and GTL have not paid the amounts outstanding. [24] Thus, Public Bank filed Suit 561 against GTL to seek the amounts outstanding, totalling RM116,346,498.24 as at 11 May 2023, together with interest. Suit 562 [25] In Suit 562, Public Bank is seeking the repayment of amounts outstanding from GTL, pursuant to a loan facility with a principal sum of RM106,000,000 granted to BOT BOT guarantor of the facility. [26] s Loan Facility is subject to the terms and conditions stipulated in Letters a facility agreement dated 15 August 2013 BOT FA Loan Facility is secured by, inter alia, a letter of continuing guarantee for execution by individual(s) dated 15 August 2013 BOT Personal [27] It is not in dispute that BOT had utilised BOT Loan Facility. [28] BOT could not meet its repayment obligations under BOT Facility. Thus, by way of several supplemental letters of offers, Public Bank extended and revised the repayment terms of BOT and granted deferments on interest payments. [29] BOT however defaulted in its repayment obligations, and as such, Public Bank recalled BOT 12 May 2023. In the letter of recall, Public Bank demanded from BOT the amounts outstanding under BOT 12 May 2023 was also issued to GTL as a guarantor of the facility. BOT and GTL have not paid the amounts outstanding. [30] Thus, Public Bank filed Suit 562 against GTL to seek the amounts outstanding, totalling RM103,508,530.78 as at 11 May 2023, together with interest. Summary of suits [31] For ease of understanding, a summary of the suits instituted by Public Bank is set out in the table below: Borrower Guarantor Facility Amount Claimed Suit 559 BOS 1st Loan Facilities of RM66,060,000 2nd Loan Facilities of RM29,465,000 RM88,268,879.40 Borrower Guarantor Facility Amount Claimed Suit 560 BG Beta Brunsfield Corporation GTL st Loan Facilities of RM1,603,000, RM962,000 and RM642,000 2nd Loan Facility of RM352,000 3rd Loan Facility of RM5,108,000 From BG Beta and GTL, RM5,117,130.89 From Brunsfield Corporation, RM1,415,000 Suit 561 Subang Mall Loan Facility of RM118,580,000 RM116,346,498.24 Suit 562 Loan Facility of RM106,000,000 RM103,508,530.78 C. Principles of Summary Judgment [32] The Summary Judgment Applications are filed under order 14 rule 1 of the Rules of Court 2012 , which provides that:

Where in an action to which this rule applies a statement of claim has been served on a defendant and that defendant has entered an appearance in the action, the plaintiff may, on the ground that the defendant has no defence to a claim included in the writ, or to a particular part of such a claim, or has no defence to such a claim or part thereof except as to the amount of any damages claimed, apply to the Court for judgment against that defendant. (emphasis added) [33] The manner in which an application for summary judgment shall be made is set out in order 14 rule 2 of the ROC. Order 14 rule 2(1) provides that the application must be supported by an affidavit verifying the facts on which the claim is based, and belief, there is no defence to that claim. [34] Once the preliminary requirements under order 14 rules 1 and 2 of the ROC have been met by the plaintiff, namely: a. The statement of claim has been served on the defendant; b. The defendant has entered appearance; and c. The affidavit in support of the summary judgment application has verified the facts upon which the claim is based, and has stated that there is no defence to the claim, the plaintiff would have established a prima facie case against the defendant. [35] The burden then shifts to the defendant to satisfy the court as to why judgment should not be given against it (see National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300). D. Considerations and Findings [36] In the present case, it is undisputed that the writs and statements of claim in all suits have been served on the defendants, and that the defendants have entered appearance. In the affidavits in support of the Summary Judgment Applications, Public Bank had verified the facts upon which the claims are based, and had stated that there is no defence to the claims. [37] s are based on the following documents: a. In Suit 559: i. In respect of 1st Loan Facilities, 1st Letters of Offer, st FA and 1st Personal Guarantee; and ii. In respect of B 2nd Loan Facilities, 2nd Letter of Offer, 2nd FA and 2nd Personal Guarantee; b. In Suit 560: i. In respect of st Loan Facilities, BG st Letter of Offer, st FAs and st Personal Guarantees; ii. In respect of nd Loan Facility, BG nd Letter of Offer, nd FA and iii. In respect of rd Loan Facility, BG rd Letter of Offer, rd FA and nd Personal Guarantee; c. In Suit 561, in respect of FA and d. In Suit 562, in respect of Loan Facility, Letters of Offer, FA and Personal Guarantee. [38] The Borrowers defaulted in their repayment obligations in the facility documents they had executed, and Public Bank filed actions against them and the guarantors of the facilities, for amounts outstanding under the facilities. [39] Public Bank is seeking the following amounts due: a. In Suit 559, from GTL as a guarantor under 1st Personal Guarantee nd Personal Guarantee, RM88,268,879.40 as at 11 May 2023, together with interest; b. In Suit 560: i. Facilities and GTL as a guarantor under BG st Personal Guarantees 2nd Personal Guarantee, RM5,117,130.89 as at 11 June 2023, together with interest; and ii. From Brunsfield Corporation as a guarantor under RM1,415,000 as at 12 May 2023, together with interest; c. Personal Guarantee, RM116,346,498.24 as at 11 May 2023, together with interest; and d. In Suit 562, from GTL as a guarantor under Personal Guarantee, RM103,508,530.78 as at 11 May 2023, together with interest. [40] In the affidavits in support of the Summary Judgment Applications, Public Bank provided statements of indebtedness certifying the amounts due to it by the defendants. [41] Based on the facts as set out, I find that Public Bank has established a prima facie case against the defendants. The burden has shifted to the defendants to satisfy the court as to why judgment should not be given against them. [42] Thus, I moved on to consider the following issues raised by the defendants which they claim would necessitate a full trial of this action: a. Public Bank had acted in an unconscionable manner in obtaining guarantees from the guarantors, namely GTL (the guarantor of the facilities that are the subject matter of Suits 559, 560, 561 and 562) and Brunsfield Corporation (the guarantor of the facility that is the subject matter of Suit 560) (collect , as: a. The Guarantors were not shareholders or directors of the Borrowers; and b. The Guarantors were induced to execute the guarantees pursuant to misrepresentations made by Public Bank, and were thereafter restrained from seeking legal advice on the guarantees. b. There would be a double recovery of the amounts owing to Public Bank in view of the commencement of JM proceedings in respect of the Borrowers and the appointment of receivers and managers BOS, Subang Mall and BOT. Issue 1 [43] The ublic Bank had conducted itself in an unconscionable manner is premised firstly on the claim that there is a lack of connection between the Borrowers and the Guarantors. The defendants argued that Guarantors were arbitrarily chosen as guarantors for the Borrowers. [44] However, documentary evidence before this court does not support the defendants claim. Instead, what is in evidence is that the Borrowers are companies within the same group, namely the Brunsfield International Group, and that GTL is the founder of the group. GTL is also connected to the Borrowers in view of the following: a. He holds 98% of shares in Brunsfield World Sdn Bhd reholder of Laris Property Sdn Bhd (formerly known as Brunsfield Property LPSB owns: i. 100% shares in BOS, the borrower in Suit 559; ii. 100% shares in Subang Mall, the borrower in Suit 561; and iii. 100% shares in BOT, the borrower in Suit 562; and b. He holds 75% of shares in Brunsfield Corporation, the nd Loan Facility in Suit 560. [45] It is clear that GTL is the individual behind the Borrowers. There is therefore nothing unconscionable or unusual for Public Bank to request GTL to provide guarantees to secure the loan facilities granted to the Borrowers, or to request Brunsfield Corporation, a company owned by GTL, to provide a similar guarantee. [46] Further and in any event, there is no evidence that the Guarantors did not agree to be guarantors. They had executed the guarantees and expressly agreed to guarantee the amounts owed by the Borrowers. They had also endorsed their consent as guarantors in the letters of offer and facility agreements issued to the Borrowers. [47] The claim of unconscionable conduct is also premised on the allegation that the Guarantors were induced to sign the guarantees, pursuant to misrepresentations made by Public Bank, and were thereafter restrained from seeking legal advice on the guarantees. The court finds this to be a bare allegation unsupported by contemporaneous evidence, and thus devoid of any merit. [48] Further, as exhibited by Public Bank shows that GTL is the founder and executive chairman of the Brunsfield International Group, a group of companies involved in multi-billion ringgit property development and real estate projects. The following observation by Lee Swee Seng JC (as His Lordship then was) in Citibank Bhd v Pembangunan Cahaya Tulin Sdn Bhd (receivers and managers appointed) [2012] 9 MLJ 181, on an individual of a similar profile, is instructive: [158] In this case, the main person behind the various facilities extended to D1 and D2 and the associated companies is D3 himself. From his own evidence in court we gather that he is a savvy, high net-worth businessman with some 30 years experience in the housing development and construction industry. We can surmise that he is often surrounded by partners and having easy access to lawyers and financial consultants to advise him. Surely he would be able to weigh and consider carefully and cautiously before accepting the restructured terms of the facilities considering the circumstances that he and (emphasis added) [49] Similarly, documentary evidence before this court shows that GTL is a seasoned businessman. With such background and profile, GTL would on the balance of probabilities, have had access to lawyers and financial consultants to advise him on transactions he and his companies were entering into. The allegation that he was induced to execute the guarantees which remains a bare allegation unsupported by any evidence must necessarily fail, with his background and profile taken into consideration. [50] It should also be noted that the allegation of misrepresentation or inducement was never raised by the defendants prior to the filing of these actions, and throughout the time the Borrowers were enjoying the loan facilities provided by Public Bank. The absence of any objection to the guarantees prior to the filing of these actions suggests that the Issue 2: Double recovery [51] It is undisputed that JM proceedings were instituted in respect of the Borrowers, and that the R&M were appointed over BOS, Subang Mall and BOT. The defendants argued there would be double recovery of amounts outstanding under the facilities, as a result of the JM proceedings and the appointments of the R&M over the Borrowers. [52] However, the court finds this argument to be misconceived. Public Bank is entitled to pursue and enforce all available remedies against the Borrowers and the Guarantors simultaneously. The terms of the guarantees executed by Brunsfield Corporation (in Suit 560) and GTL (in Suits 559, 560, 561 and 562), as well as the facility agreements in the case of BG Beta (in Suit 560) allow Public Bank to pursue all remedies against the Borrowers and the Guarantors simultaneously. The JM proceedings and the appointment of the R&M do not restrict Public Bank from pursuing the legal actions against the defendants. [53] simultaneously was recognised by the Supreme Court in Low Lee Lian v Ban Hin Lee Bank Bhd [1997] 1 MLJ 77, at page 93B of the judgment: 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 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 (emphasis added) [54] With the findings made, it is my considered view that the issues raised by the defendants are inherently improbable, inconsistent with undisputed contemporaneous documents and are not legally defensible. Thus, they do not qualify as issues to be tried that must be considered and determined by way of a full trial. [55] I am guided by Bank Negara Malaysia v Mohd Ismail & Ord [1992] 1 MLJ 400, where the Supreme Court held that: duty of a judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other in an 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 (emphasis added) [56] I find the case before this court to be one in which the facts asserted by the defendants are clearly inconsistent with undisputed contemporaneous documents. E. Decision [57] With the findings made, the court is of the considered view that the defendants have not raised any issue that would necessitate a full trial of this action. [58] Thus, the court allowed the Summary Judgment Applications, except against BG Beta in Suit 560. In respect of enclosure Suit 560, the amount claimed was reduced in view of partial settlements made. The amounts allowed in enclosures 23 and 29 of Suit 560 are as set out in paragraphs (C), (D) and (E) of the certificate of indebtedness in exhibit PBB-20 of enclosure 25. [59] The court ordered costs of RM10,000 to be paid for each application. Dated 30 September 2024 ADLIN ABDUL MAJID Judge High Court of Malaya Kuala Lumpur Counsel: Plaintiff : Ooi Ai Yen (together with Tan Hui Ru and Nor Syazana Jamaluddin) of Messrs. Benjamin Dawson Defendants : Julie Ha of Messrs. Tiong & Associates