Rhb Bank Berhad v Millennium Skill Training Academy Sdn Bhd (WA-22NCC-63-02/2023)

MILLENNIUM SKILL TRAINING ACADEMY SDN BHD

SIVAMURTHY A/L MUNIANDY [IC No.: 541224-07-5565]

SHANGKARI A/P SIVAMURTHY [IC No.: 881023-43-5510]

MOHAMAD FARID BIN ISMAIL [IC No.: 731104-14-5159] ... DEFENDANTS JUDGMENT Introduction [1] This judgment concerns the Plaintiff's application to strike out the Defendants' counterclaim. The Plaintiff granted loan facilities which were secured against properties belonging to the First Defendant and guaranteed by the Second to Fourth Defendants by way of deeds of assignment. The Defendants failed to meet their repayment obligations under the term loans, resulting in the Plaintiff issuing notices of termination and demanding full payment of the outstanding S/N SlfI2ZXglUOyOacdaWtew amounts. The Plaintiff also commenced proceedings against the Defendants and attempted to dispose of the secured properties by way of a public auction, which prompted the Defendants' counterclaim seeking to restrain the same on the grounds that the Plaintiff's conduct in terminating the loans and proceeding with the auction was premature in light of the Defendants' various proposals for a repayment plan. The key issue for determination is whether the Plaintiff is entitled to enforce its statutory and contractual rights as an assignee to dispose of the First Defendant's secured properties upon default in repayment of the loan facilities warranting the summary dismissal of the counterclaim on the grounds that it discloses no reasonable cause of action, is scandalous, frivolous or vexatious and/or an abuse of the court process. Background facts [2] The Plaintiff, RHB Bank Berhad, granted three term loan facilities to the First Defendant, Millennium Skill Training

Academy Sdn Bhd, vide letters of offer dated 24.08.2016,

08.2016 and 09.09.2016, and facility agreements dated 15.11.2016 and 17.03.2017. The facilities comprised Term Loan 1 of RM1,320,000.00 with a monthly instalment of RM8,784.50, Term Loan 2 of RM1,320,000.00 with a monthly instalment of RM8,784.50, and Term Loan 3 of RM1,040,000.00 with a monthly instalment of RM6,921.12. The Second to Fourth Defendants agreed to be guarantors for the repayment of the Term Loan Facilities vide S/N SlfI2ZXglUOyOacdaWtew guarantee documents dated 15.11.2016 and 17.03.2017. The three Term Loan Facilities are referred to as the “Term Loan Facilities”. [3] As security for the Term Loan Facilities, the First Defendant assigned absolutely to the Plaintiff all of its rights, title and interest in three pieces of property held under GRN 3547, Lot 1475, Mukim Serendah, Daerah Hulu Selangor, Selangor, namely a three-storey terrace factory known as Lot 19, Block B, Sungai Choh Auto City, a three-storey terrace factory known as Lot 20, Block B, Sungai Choh Auto City, and a three-storey terrace factory known as Lot 21, Block B, Sungai Choh Auto City (“the Subject Properties”), vide deeds of assignment executed on 15.11.2016 and 17.03.2017 (“Deeds of Assignment”). [4] From 2016, the First Defendant serviced the monthly instalments under the three Term Loan Facilities. However, by a letter dated 21.08.2019 issued by the Plaintiff's solicitors, the First Defendant was informed that it was in default of payment of the sum of RM46,773.03 under the Term Loan Facilities and was demanded to settle the same. The First Defendant failed to regularise the outstanding arrears despite the demand. The Plaintiff subsequently issued a notice dated 14.10.2019 terminating and recalling the Term Loan Facilities and demanded payment of the total outstanding sums due from the defendants. S/N SlfI2ZXglUOyOacdaWtew [5] The Plaintiff previously agreed to the First Defendant's request vide letters dated 04.05.2020,

09.10.2020,

17.03.2021 and 19.08.2021 to allow the First Defendant to repay the outstanding amounts in instalments subject to the terms and conditions stated therein. However, the First Defendant failed to comply with the agreed terms of repayment, resulting in the Plaintiff issuing a notice of termination and recall of the Term Loan Facilities dated 17.03.2022 wherein the total outstanding sums were demanded from the defendants. [6] The Plaintiff also commenced a civil suit against the defendants in Kuala Lumpur High Court vide Civil Suit No. WA-22NCC-165-04/2022 to recover the outstanding sums due under the Term Loan Facilities. Upon the First Defendant's request, the Plaintiff agreed to withhold the said suit to allow the First Defendant to settle the outstanding amounts vide letters dated 28.06.2022,

27.10.2022 and 07.11.2022, subject to the First Defendant complying with the stipulated conditions. The First Defendant again failed to settle the outstanding amounts in accordance with the terms set out by the Plaintiff. [7] Vide a notice dated 16.01.2023, the Plaintiff terminated and recalled the Term Loan Facilities and demanded payment from the defendants of the total outstanding sums of RM1,404,045.01 in respect of Term Loan 1, RM1,395,327.58 in respect of Term Loan 2, and RM1,073,463.60 in respect of Term Loan 3 as at

10.01.2023, together with interest at the rate specified therein. The defendants failed to settle the outstanding amounts despite this demand. [8] As at 07.02.2023, the total outstanding sums due from the defendants were RM1,403,826.01 in respect of Term Loan 1, RM1,412,609.24 in respect of Term Loan 2, and RM1,079,539.87 in respect of Term Loan 3, together with interest at the rate of 3.50% per annum above the Plaintiff's base lending rate on the outstanding amounts from 08.02.2023 until full settlement. [9] The Plaintiff issued notices dated 15.02.2023 to the First Defendant pursuant to the Deeds of Assignment, terminating its license to occupy the Subject Properties and demanding vacant possession of the same to be delivered to the Plaintiff. The Plaintiff also rejected the First Defendant's request to restructure the outstanding amounts at a lower monthly instalment vide letters dated 10.02.2023 and 07.03.2023 on the basis that the proposed monthly instalment was insufficient to settle the total outstanding amounts, which would result in a ballooning of the sums due in light of the interest that continued to accrue at the applicable rate. [10] The Plaintiff commenced the present action against the defendants vide a writ and statement of claim dated 14.02.2023 seeking, among others, payment of the outstanding sums of RM1,403,826.01 in respect of Term S/N SlfI2ZXglUOyOacdaWtew Loan 1, RM1,412,609.24 in respect of Term Loan 2, and RM1,079,539.87 in respect of Term Loan 3 as at 07.02.2023, together with interest thereon at the rate of 3.50% per annum above the Plaintiff's base lending rate from 08.02.2023 until full realisation. [11] On 23.03.2023, the Defendants filed their Defence denying the plaintiff's claim and contending, among others, that the Plaintiff's termination of the loan facilities and demand for payment vide its letter dated 16.01.2023 was premature and not bona fide as parties were allegedly still in the midst of negotiations for a repayment plan in light of the First Defendant's financial difficulties due to the Covid-19 pandemic. The Defendants subsequently filed an Amended Defence and Counterclaim dated 31.03.2023 seeking, inter alia, an injunction to restrain the plaintiff from proceeding with the auction of the Subject Properties and general damages to be assessed, on the grounds that the Plaintiff's action in terminating the loans and auctioning the security was premature as parties were still negotiating a repayment plan. [12] Concurrently, on 07.04.2023 and 31.05.2023, the Plaintiff sought to dispose of the Subject Properties by way of public auction pursuant to the Deeds of Assignment through the appointed auctioneer, Messrs Ng Chan Mau & Co. The Defendants filed an application for an interlocutory injunction to restrain the auction of the Subject Properties which was dismissed by the court on 06.04.2023. S/N SlfI2ZXglUOyOacdaWtew [13] On 02.10.2023, upon the Plaintiff's application for summary judgment, the court granted the Plaintiff judgment against the Defendants for the reliefs sought in the writ and statement of claim together with costs of RM3,000.00. The Plaintiff also filed an application dated 27.10.2023 to strike out the defendants' counterclaim dated 18.04.2023 which sought declarations to restrain the Plaintiff from proceeding with the auction of the Subject Properties and for damages to be assessed, on the grounds that the counterclaim was unsustainable, frivolous, vexatious and an abuse of the court process. This application was fixed for hearing on 31.10.2023 before the court. The Defendant’s counterclaim [14] The Defendants seek an injunction to restrain the Plaintiff from proceeding with the auction of the Subject Properties on the basis that the Plaintiff's action in recalling the loan facilities and attempting to dispose of the securities is premature and not bona fide as parties are allegedly still negotiating a repayment plan. Defendants contend that the Plaintiff is estopped from commencing the present action based on the representations made by the Plaintiff's officers during negotiations. The following was pleaded by the Defendants in the Defendants' Amended Statement of Defence and Counterclaim: S/N SlfI2ZXglUOyOacdaWtew a) The First Defendant had been servicing the monthly instalments for the Term Loan Facilities regularly since the loans were disbursed in 2016. However, due to the Covid-19 pandemic, the First Defendant's business was affected but the First Defendant had been in constant communication with the Plaintiff to reach a repayment plan that would protect the interests of both parties. b) From March 2020 until March 2022, the First Defendant had continuously communicated and negotiated with the Plaintiff regarding a repayment plan and structure for the First Defendant's loans. The Plaintiff had apparently agreed to allow the First Defendant to pay RM1,000.00 for each loan account until February 2022. c) On several occasions in February, March and April 2022, the First Defendant had written to the Plaintiff to provide updates on its financial situation and cash flow, and to seek a further 6-month moratorium and propose a repayment plan. The Defendants claim that the Plaintiff did not respond to these proposals. d) The Plaintiff's officers had represented that the issue of a repayment plan was still under review and the Plaintiff would revert on the First Defendant's proposals. The Defendants contend that the Plaintiff S/N SlfI2ZXglUOyOacdaWtew is estopped from commencing this action in light of these representations. e) The Plaintiff's decision to terminate and recall the loan facilities via its letter dated 16.01.2023 was premature and not bona fide as parties were still in the midst of negotiations to reach a suitable repayment plan. f) The present action by the Plaintiff is thus premature as the negotiation process is still ongoing and the Plaintiff had yet to respond to the First Defendant's various letters and proposals for a repayment plan. [15] The Defendants pray for the following reliefs: a) An injunction for the Plaintiff to withdraw the Subject Properties that were assigned by the First Defendant to the Plaintiff as security for the repayment of the Term Loan Facilities granted by the Plaintiff from being auctioned which was scheduled to be conducted online by Ng Chan Mau & Co on 07.04.2023 at 11.30am; b) A prohibitory injunction against the Plaintiff, whether by itself and/or through its employees, representatives and/or agents, from auctioning off the above properties, including any steps aimed at commencing any auction; and S/N SlfI2ZXglUOyOacdaWtew c) General damages to be assessed. The Plaintiff’s application [16] In the Notice of Application dated 27.10.2023 (Enclosure 28) pursuant to Order 18 Rule 19(1)(b) and (d) and/or Order 92 Rule 4 of the Rules of Court 2012 (“ROC 2012”) the Plaintiff prays for the following orders: a) That the Defendants' counterclaim dated 18.04.2023 be struck out on the grounds that it is unsustainable, frivolous, vexatious or is otherwise an abuse of the process of the court; b) Costs; and c) Any other relief that the court deems fit, proper and/or appropriate. The law on striking out pursuant to Order 18 Rule 19 Rules of Court 2012 [17] The rules on striking out pleadings are provided in Order 18 Rule 19(1) ROC 2012 which is reproduced below for convenience: “19. Striking out pleadings and endorsements (O. 18 Rule 19)

The Court may at any stage of the proceedings order to be struck out or amended any S/N SlfI2ZXglUOyOacdaWtew 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.” [18] The Federal Court in Tan Wei Hong (A Minor Suing Through Guardian Ad Litem And Next Friend Chuang Yin E) & Ors v Malaysia Airlines Bhd And Other Appeals [2018] 9 CLJ 425 has succinctly laid out the test for striking out pleadings, referring to the locus classicus Bandar Builders Sdn Bhd. v United Malayan Banking Corporation Bhd [1993] 4 CLJ 7. Ramly Ali FCJ delivering the judgment of the court, stated as follows: “The tests for striking out application under Order 18 Rule 19 of the ROC, as adopted by the Supreme Court in Bandar Builders are, inter alia, as follows:

it is only in plain and obvious cases that recourse should be had to the summary process under the rule;

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;

it cannot be exercised by a minute examination of the documents and facts of the case in order to see whether the party has a cause of action or a defence;

if there is a point of law which requires serious discussion, an objection should be taken on the pleadings and the point set down for argument under Order 33 Rule 3 of the ROC; and

the court must be satisfied that there is no reasonable cause of action or that the claims are frivolous or vexatious or that the defences raised are not arguable.” [19] The Court of Appeal, in Sivarasa Rasiah & Ors v Che Hamzah Che Ismail & Ors [2012] 1 CLJ 75 adopted the well-settled principle of striking out in the following passage: “A striking out order should not be made summarily by the court if there is issue of law that requires lengthy argument and mature consideration. It should also not be made if there is issue of fact that is capable of resolution only after taking viva voce evidence during trial (see: Lai Yoke Ngan & Anor v Chin Teck Kwee & Anor [1997] 3 CLJ 305; [1997] 2 MLJ 565 (FC)).” Analysis and findings of the court Plaintiff’s right to dispose of the First Defendant's properties pursuant to the Deeds of Assignment [20] The Plaintiff contends that the Deed of Assignment dated 15.11.2016 executed by the First Defendant constitutes an absolute assignment of the First Defendant's rights, title and interest in the subject properties to the Plaintiff. The Plaintiff relies on Section 3.01 of the Deeds of Assignment which provides that “the Assignor as beneficial owner hereby assigns absolutely to the Bank all the Assignor's rights, title S/N SlfI2ZXglUOyOacdaWtew and interest whatsoever in and to the Assigned Property and under the Sale Agreement together with the Assignor's right of enforcement thereof”. The Plaintiff further argues that it was the clear intention of the parties that the assignment created pursuant to Section 3.01 shall be an absolute and unconditional assignment and not an assignment by way of charge only. [21] The Defendants submit that the Plaintiff has no right to dispose of the First Defendant's properties pursuant to the Deeds of Assignment as they are assignments by way of charge only and not absolute assignments pursuant to section 4(3) of the Civil Law Act 1956. The Defendants rely on the High Court case of Yap Chee Keong Holdings Sdn Bhd v Cosmopolitan Avenue Sdn Bhd [2022] 3 CLJ 764 to argue that the court ought to look at the factual matrix in interpreting the Deeds of Assignment to determine the intention of the parties. The Defendants contend that the provisions in the Deeds of Assignment, read together with the factual matrix, support the manifest intention of the parties that the assignments are by way of charge and not absolute assignments. [22] Having considered the submissions of the parties and the documents before me, I am of the view that the Deed of Assignment dated 15.11.2016 constitutes an absolute assignment of the First Defendant's rights, title and interest in the subject properties to the Plaintiff. A plain reading of Section 3.01 of the Deeds of Assignment clearly provides S/N SlfI2ZXglUOyOacdaWtew that the assignment by the First Defendant to the Plaintiff of all its rights, title and interest in the properties is an absolute assignment. Section 3.01 provides: “Section 3.01 ASSIGNMENT In consideration of the Bank having at the request of the Assignor granted or made available or agreed to grant or make available or to continue to grant and make available the Facilities and for better securing the payment or repayment of the Indebtedness, the Assignor as beneficial owner hereby assigns absolutely to the Bank all the Assignor's rights, title and interest whatsoever in and to the Assigned Property and under the Sale Agreement together with the Assignor's right of enforcement thereof PROVIDED ALWAYS that notwithstanding this Assignment, the Assignor shall and hereby undertakes to continue to observe and be bound by all whatsoever conditions, covenants and stipulations therein on the part of the Assignor expressed and contained in the Sale Agreement and the Bank shall have no obligation or liability under the Sale Agreement by reason of or arising out of this Assignment, nor shall the Bank be required or obligated in any manner to observe or perform any of the conditions or obligations of the Assignor under or pursuant to the Sale Agreement or to present or file any claim, or to take any other action to enforce the terms of the Sale Agreement. For the avoidance of doubt, it is the intention of the parties hereto that the assignment created pursuant to this Section 3.01 shall be an absolute and unconditional assignment and not an assignment by way of charge. In the event any of the provisions of this Assignment is inconsistent with such express intention of the parties as aforesaid, such inconsistent provisions shall be rejected as repugnant and the intention of the parties as expressed above shall prevail.” (emphasis added) S/N SlfI2ZXglUOyOacdaWtew [23] Crucially, it expressly states that it is the intention of the parties that the assignment shall be an absolute and unconditional assignment and not an assignment by way of charge. In the event any of the provisions are inconsistent with such express intention, those inconsistent provisions shall be rejected. This evinces a clear and unequivocal intention by the parties that the assignment is an absolute one. [24] I am guided by the Federal Court decision in Nouvau Mont Dor (M) Sdn Bhd v Faber Development Sdn Bhd [1984] 2 MLJ 268 which held that the question of whether an assignment is an absolute one within the meaning of section 4(3) of the Civil Law Act 1956 is to be gathered from the four corners of the instrument itself. Section 4(3) of the Civil Law Act 1956 provides that “Any absolute assignment by writing under the hand of the assignor, not purporting to be by way of charge only, of any debt or other legal chose in action...”. Seah FCJ opined as follows: “In our judgment and it seems clear from the authorities above-mentioned, whether or not an assignment is an absolute one (not purporting to be by way of charge only) within the meaning of s. 4(3) [CLA] is to be gathered only from the four corners of the instrument itself. Looking at the whole document of February 18, 1978 and bearing in mind the provision of s. [CLA], in our opinion, the document was an absolute assignment and not purporting to be by way of charge only within the meaning of s. 4(3) [CLA]. The assignment was in terms absolute in the sense that the assignor (appellant) intended to pass and transfer to the assignee (Public Bank) S/N SlfI2ZXglUOyOacdaWtew absolutely the beneficial interest as well as all the rights title and interest in the Sale Agreement dated April 1, 1977 and the remedies of enforcing them.” [25] His Lordship further opined that this is irrespective of whether the assignment is entered into following a loan agreement as the court should not read the assignment in isolation with the said loan agreement. If the assignment was an absolute one, the fact that it had the effect of passing to the assignee the rights, title and interest of the assignor in the sale agreement and the beneficial interest of the assignor in the said property under the sale agreement by way of security only did not derogate from the absolute character of that assignment. [26] Applying the above principles to the present case, it is evident from the express words used in Section 3.01 of the Deeds of Assignment that the parties clearly intended for there to be an absolute assignment by the First Defendant to the Plaintiff of the former's rights, title and interest in the subject properties. Section 3.01 explicitly uses the term “hereby assigns absolutely” in describing the nature of the assignment of the First Defendant's rights, title and interest in the properties to the Plaintiff. Furthermore, the parties expressly stated that it is their intention that “the assignment created pursuant to this Section 3.01 shall be an absolute and unconditional assignment and not an assignment by way of charge”. The provision goes on to say that in the event any part of the Deeds of Assignment are inconsistent with such express intention of an absolute assignment, S/N SlfI2ZXglUOyOacdaWtew those inconsistent provisions shall be rejected and the express intention of the parties shall prevail. A plain construction of Section 3.01 in its entirety, bearing in mind the clear words used by the parties, inexorably leads to the conclusion that the parties intended to effect an absolute assignment within the meaning of section 4(3) of the Civil Law Act 1956. Following the approach laid down by the Federal Court in Nouvau Mont Dor, this intention is plain and obvious from the four corners of the Deeds of Assignment alone, without the need to refer to any other documents including the loan agreements. [27] While the subsequent Federal Court decision in Berjaya Times Square Sdn Bhd v M-Concept Sdn Bhd [2010] 1 MLJ 597 held that the court interpreting an agreement is entitled to look at the factual matrix forming the background to the transaction, I am of the considered view that this does not detract from the clear intention of the parties as unequivocally stated in Section 3.01 of the Deeds of Assignment. The factual matrix should not be utilised to displace the parties' express intention encapsulated within the four corners of the Deeds of Assignment that the assignment is an absolute one. In any event, I find that the provisions highlighted by the Defendants do not necessarily point to the assignments being one by way of charge only. S/N SlfI2ZXglUOyOacdaWtew [28] The Defendants rely on the High Court decision in Yap Chee Keong Holdings Sdn Bhd v Cosmopolitan Avenue Sdn Bhd [supra] to argue that the Deeds of Assignment executed by the First Defendant do not constitute absolute assignments of the First Defendant's rights and interest in the subject properties to the Plaintiff. However, I am of the view that Yap Chee Keong does not assist the Defendants in the present case. [29] Yap Chee Keong concerned a different factual matrix. In that case, the issue was whether purchasers of properties (the plaintiffs) had the requisite locus standi to commence an action against the developer for liquidated damages in light of a prior assignment executed in favour of the plaintiffs' financier bank. The properties were the subject of loan agreements cum assignments between the plaintiffs and the bank. The defendant developer argued that as these agreements constituted absolute assignments, the plaintiffs required the bank's consent to initiate the action. The court eventually found that the loan agreements cum assignments were not absolute assignments but assignments by way of charge, thus the bank's consent was not necessary for the plaintiffs to sue. [30] It is pertinent to note that the court in Yap Chee Keong was concerned with agreements described as “loan agreements cum assignments” entered into between purchasers and a bank, where the issue was the purchasers' locus to sue the developer. This is far removed from the present case where S/N SlfI2ZXglUOyOacdaWtew the Plaintiff, being the assignee bank itself, is asserting its right as an absolute assignee to realise the security provided by the First Defendant by auctioning the subject properties upon the latter's default in loan repayments. The question of locus standi vis-à-vis the bank does not arise here, as the Plaintiff bank is the one enforcing its rights under the Deeds of Assignment. [31] Further, in ascertaining whether the assignments were absolute in nature, the court in Yap Chee Keong adopted the second approach laid down by the Federal Court in Berjaya Times Square Sdn Bhd v M-Concept Sdn Bhd. This entailed looking at the factual matrix forming the background of the transaction to determine the manifest intention of the parties, rather than merely confining the inquiry to the four corners of the agreements in question. As elucidated above, applying this approach to the present Deeds of Assignment reveals a clear intention by the parties to effect an absolute assignment of the First Defendant's rights and interest to the Plaintiff. There is nothing to suggest that a similar analysis was undertaken in Yap Chee Keong to arrive at a contrary conclusion that the assignments there were by way of charge only. [32] Moreover, the court in Yap Chee Keong went on to find that a wholesale reading of the provisions of the loan agreements cum assignments, in particular the obligation to pay the loan on demand, the assignor's duty to pay maintenance and other fees, the classification of the S/N SlfI2ZXglUOyOacdaWtew security as a “continuing security”, among others, could not displace the intention of the parties that the assignments were by way of charge only. Conversely, in the present case, the provisions of the Deeds of Assignment are entirely consistent with an absolute assignment, with the expressed intention of the parties as encapsulated in Section 3.01 being reinforced by Section 7.01 which clearly delineates the Plaintiff's right as assignee to take possession and dispose of the subject properties upon the occurrence of an event of default. [33] In the circumstances, Yap Chee Keong is wholly distinguishable from the present matter, both factually and in the application of the relevant legal principles. The decision does not detract from the inevitable conclusion that the Deeds of Assignment executed by the First Defendant constitute absolute assignments to the Plaintiff. [34] Earlier this court on 06.04.2023 dismissed Enclosure 6, the Defendant's application for a prohibitory injunction to restrain the Plaintiff from auctioning off the subject properties. In the Brief Grounds of Decision, this court distinguished the decision in Yap Chee Keong Holdings and held that the circumstances of the present case are different. I stated at paragraph 11 of my Brief Grounds of Decision as follows: “In Yap Chee Keong, the court held that there was no absolute assignment of the Properties by way of a loan agreement cum assignment, not dissimilar to S/N SlfI2ZXglUOyOacdaWtew the security arrangements of the instant case. However, this case does not assist the Defendant. The case concerned purchasers of properties who are suing for liquidated damages from the developer. The properties were under an assignment in favour of the bank that provided the plaintiff the loan. The defendant developer argued that the plaintiff had no locus standi to file the action without the bank's consent as the loan agreements cum assignments were absolute assignments. The court held that these were not absolute assignment but assignments by way of charge, thus the bank's consent was not needed.” [35] In the Brief Grounds I then went on to explain that: “The circumstances here are different as the Plaintiff bank is pursuing its rights to sell the Properties upon the First Defendant's default which have been specifically and clearly provided for under the Deeds of Assignment. Given that it is an assignment by way of charge, the Plaintiff is utilising the Deeds of Assignment exactly for its purpose when it proceeds to sell the Properties.” [36] It is evident from the above that this court had already considered the High Court's decision in Yap Chee Keong but found it to be distinguishable on the facts, in particular that the Plaintiff bank in the present case is seeking to enforce its rights under the Deeds of Assignment upon the occurrence of the First Defendant's default, which is the very purpose and intention of executing the Deeds of Assignment in the first place. [37] This decision by this court in dismissing the Defendant's injunction application lends support to the finding that the Deeds of Assignment, properly construed, constitute absolute assignments by the First Defendant to the Plaintiff S/N SlfI2ZXglUOyOacdaWtew of the former's rights, title and interest in the subject properties. This court recognised that the Plaintiff is simply acting pursuant to the rights accorded to it under the Deeds of Assignment in moving to auction the subject properties upon the First Defendant's default. Such rights are consistent with the Plaintiff being an absolute assignee of the First Defendant's rights and interest in the subject properties. This court's pronouncement that the Plaintiff is utilising the Deeds of Assignment for the exact purpose it was intended for further bolsters the case that parties had intended for there to be an absolute assignment. [38] In the circumstances, I find that the Deed of Assignment dated 15.11.2016 does indeed constitute an absolute assignment of the First Defendant's rights, title and interest to the Plaintiff. Accordingly, the Plaintiff is entitled to exercise its right to auction off the subject properties upon the First Defendant's default in repayment under the loan facilities, as expressly provided for under Section 7.01 of the Deeds of Assignment. Premature disposal of the Subject Properties [39] The Defendants contend that the Plaintiff is estopped from commencing the present action based on representations allegedly made by the Plaintiff's officers during negotiations that the issue of a repayment plan was still under review and the Plaintiff would revert on the First Defendant's S/N SlfI2ZXglUOyOacdaWtew proposals. With respect, I am unable to accept this contention as disclosing any triable cause of action. [40] The contemporary restatement of the doctrine of estoppel by the Federal Court in Boustead Trading (1985) Sdn Bhd v Arab-Malaysian Merchant Bank Berhad [1995] 4 CLJ 283 makes it abundantly clear that it is not necessary for a representee to prove that a representation was made to it. Gopal Sri Ram JCA (as he then was), delivering the judgment of the court, stated as follows: “The traditional view adopted by jurists of great learning is that a litigant who invokes the doctrine must prove that he was induced by the conduct of his opponent to act in a particular way. However, having undertaken a careful examination of the authorities, we are of opinion that this requirement is not an integral part of the doctrine. All that a representee (which term includes one who has received encouragement in the sense we have discussed earlier) need do is to place sufficient material before a Court from which an inference may fairly be drawn that he was influenced by his opponent's actings.” [41] There is nothing averred in the Defence or the Counterclaim from which it can even be inferred that the Defendants were influenced by anything said by the Plaintiff's officers during their negotiations. All that has been pleaded is that the Plaintiff's officers represented that the Defendants' proposals were under consideration. There is a dearth of particulars as to the nature, date and manner of the representations made and the identities of the maker and recipient of the alleged representations. Crucially, the S/N SlfI2ZXglUOyOacdaWtew Defendants have failed to plead any facts to show that they had acted upon or altered their position in reliance on the alleged representations. There is therefore no basis for the Defendants to invoke any species of estoppel to preclude the Plaintiff from commencing the present proceedings. [42] Further, the Plaintiff cannot be estopped from enforcing its strict legal rights as chargee of the Subject Properties. It is not the Defendants' case that any concluded agreement had been reached between the parties for a restructuring of the Defendants' repayment obligations. The mere fact that parties had entered into negotiations does not by itself preclude the Plaintiff from exercising its undoubted rights under the deeds of assignment upon the occurrence of a default in repayment by the Defendants. The Plaintiff was at all times acting within its legal rights in issuing the various notices of termination and demands when the Defendants failed to meet the repayment schedules earlier agreed to. In Boustead Trading, Gopal Sri Ram JCA explained that: “It is also wrong to think that the doctrine [of estoppel] is confined to cases where a representation of fact has been made or where a party has been encouraged by another to believe in the existence or in the non-existence of a fact. The decisions of the Privy Council in Sarat Chunder Dey and The Calgary Milling Co (among others) to which we have referred earlier concerned cases involving representations not of fact but of law.” S/N SlfI2ZXglUOyOacdaWtew [43] Accordingly, the fact that the Plaintiff had on several occasions agreed to grant the Defendants indulgence in meeting their repayment obligations does not prevent the Plaintiff from strictly enforcing its rights as a chargee when the Defendants failed to adhere to the revised repayment terms. The applicable principle was stated by the Privy Council in Dawsons Bank v Nippon Menkwa Kabushiki Kaisha LR 62 IA 100, 108 as follows: “Estoppel is not a cause of action. It may (if established) assist a plaintiff in enforcing a cause of action by preventing a defendant from denying the existence of some fact essential to establish the cause of action, or (to put it in another way) by preventing a defendant from asserting the existence of some fact the existence of which would destroy the cause of action.” [44] In the present case, the Plaintiff's cause of action arises from the Defendants' breach of the repayment terms under the facility agreements and the Plaintiff's legal rights as chargee under the Deeds of Assignment. There is nothing pleaded in the Defence or Counterclaim that is capable of estopping the Plaintiff from enforcing these rights. [45] In any event, I am satisfied on the evidence that the Plaintiff had provided the Defendants ample opportunity to settle the outstanding amounts due before resorting to legal proceedings. The various correspondence shows that the Plaintiff had agreed to the Defendants' request to repay the outstanding sums in instalments vide letters dated 04.05.2020, 09.10.2020, 17.03.2021 and 19.08.2021. The S/N SlfI2ZXglUOyOacdaWtew Plaintiff only issued the notice of termination dated 17.03.2022 upon the Defendants' failure to comply with the agreed repayment terms. The Plaintiff again demonstrated leniency by agreeing to withhold legal action vide its letters dated 28.06.2022, 27.10.2022 and 07.11.2022 to enable settlement of the outstanding amounts. This was not met with the expected response by the Defendants. [46] The Plaintiff's rejection of the First Defendant's request vide letters dated 10.02.2023 and 07.03.2023 to restructure the repayments at a much reduced monthly instalment was entirely reasonable as it would result in the total outstanding sum ballooning in light of the continuing accrual of interest. [47] The Plaintiff's multiple extensions of time granted to the Defendants, stretching over a period of two years, to remedy the breach militates against any suggestion that the Plaintiff had acted hastily or unreasonably in terminating the loan facilities and commencing the present action. The Plaintiff has clearly provided a reasonable opportunity to the Defendants to settle the outstanding amounts before enforcing its undoubted rights as chargee. Conclusion [48] Considering the totality of the facts and circumstances of the case as disclosed in the affidavit evidence, It was quite clear to me that the Defendant had met the requirements in an Order 18 Rule 19 ROC 2012 application in accordance S/N SlfI2ZXglUOyOacdaWtew with the principles established by Bandar Builders Sdn Bhd. v United Malayan Banking Corporation Bhd [supra]. Accordingly, I allowed Enclosure 28 with costs of RM2,000. 1 April 2024 ATAN MUSTAFFA YUSSOF AHMAD Judge Kuala Lumpur High Court (Commercial Division) Counsel: For the Plaintiff: Muhamad Mizan bin Omar (Messrs Kington Tan Dzul) For the Defendant: Dalveena Korotana (Messrs. Arnold Andrew & Co)