Shu Fong Yean v 1. ) Cimb Bank Berhad (WA-24NCvC-3698-10/2022)

This is an Originating Summons filed by the Plaintiff on 28-10-2022 to set aside an Order for Sale granted by the KL High Court more than three [3] years ago on 02-07-2019. [“Order for Sale”].

The acute issue brought into focus in this Originating Summons is the scope and ambit of the Federal Court decision of Badiaddin bin Mohd Mahidin v Arab Malaysian Finance Bhd [1998] 1 MLJ 393 FC. [“Badiaddin”].

The Plaintiff argues that Badiaddin allows her to come to Court at any time to set aside the Order for Sale without the need for an appeal, and notwithstanding the passage of time without the need to justify the delay in her application.

For the Plaintiff’s learned counsel to assert that any delay in the Plaintiff’s application is not relevant and thus need not be explained, I say at the outset I do not accept. That would “be going a bridge too far,” to quote the opinion of a worried Lieutenant General Frederick Browning to Field Marshal Montgomery during the final conference on Operation Market-Garden. This quote, since immortalised in Cornelius Ryan’s World War 2 classic A Bridge Too Far, and the similarly titled movie, has become an idiom in the English language to denote an act of overreaching for something. S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 3

The Order for Sale was granted in the foreclosure Originating Summons because the chargors [the Plaintiff and the 2nd Defendant in this Originating Summons] failed to repay the loan owed to the chargee / the 1st Defendant in this Originating Summons [“CIMB”].

The Plaintiff contends the Order for Sale should be set aside because; a) This Court has jurisdiction to set aside the Order for Sale. b) The Order for Sale did not comply with Section 8 [2A] of the Bankruptcy Act 1967 as CIMB had claimed for interest accruing on the loan after the making of the receiving order on the 2nd Defendant on 25-06-2017; and c) The supporting affidavit affirmed in the foreclosure Originating Summons, by CIMB, failed to comply with Order 83 rule 3 [3] Rules of Court 2012 as no particulars of the amount remaining due under the charge as at the hearing date of the Originating Summons was furnished. [Emphasis added].

CIMB resists this Originating Summons on the following grounds - a) The Order for Sale once sealed cannot be set aside as the Court is functus officio [Latin for having performed his duty, having served its purpose]. An appeal must be filed if the Plaintiff wishes to set aside the order. S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 4 b) The Plaintiff must file the setting aside within the same proceedings or action in which the Order for Sale was obtained and not in a separate fresh proceeding or new action. c) There was inordinate delay as this Originating Summons was filed on 28-10-2022 when the Order for Sale was granted on 02-07-2019. No explanation was given for the delay. d) CIMB was entitled to claim for interest post the bankruptcy of the 2nd Defendant as the Plaintiff and 2nd Defendant were joint borrowers under the loan and owed a joint and several liability to CIMB. Clause 2.1[b] of the Charges states expressly that in the event one of the borrowers is declared a bankrupt the other borrower i.e. the Plaintiff, who is not a bankrupt, is under a legal obligation to pay interest notwithstanding Section 8[2A] of the Bankruptcy Act 1967. e) The supporting affidavit affirmed in the foreclosure Originating Summons, by CIMB, had complied with Order 83 rule 3[3] Rules of Court 2012 as particulars of the amount remaining due under the charge as at the hearing date of the Originating Summons were furnished. [Emphasis added].

The 2nd Defendant in this Originating Summons was made a bankrupt on 25-06-2017. The Insolvency Department officer was present at the hearing before me on 09-02-2023 but did not make any submissions. S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 5

I dismissed the Originating Summons on 09-02-2023. The Plaintiff has filed an appeal to the Court of Appeal. These are my Grounds of Decision.

The background facts are basically undisputed.

The Plaintiff and the 2nd Defendant are registered proprietors of a property. In exchange for two housing loan facilities they created two Charges in 2007 and 2011 in favour of CIMB.

The 2nd Defendant was made a bankrupt on 25-06-2017. The grievance of the Plaintiff is that CIMB did not take steps to realise the property within 6 months from 25-06-2017. [See Supporting Affidavit at paragraph 8].

However, it should be noted that there is no evidence put before this Court that there was default in the loan repayments by the Plaintiff in the years 2017 and 2018.

The evidence put before this Court is that the default in repayment happened on or about February 2019 when CIMB’s solicitors terminated and recalled the loan facilities by a letter dated 13-02-2019 sent to the Plaintiff and the 2nd Defendant. [See Supporting Affidavit at paragraph 9]. S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 6

CIMB then applied to Court in KLHC Saman Pemula No. WA-24FC- 526-05/2019 and obtained the Order for Sale on 02-07-2019. [See Supporting Affidavit at Exhibit. S-1].

There is no evidence put before this Court that the Plaintiff and the 2nd Defendant resisted the Order for Sale. The Order for Sale says they were absent. [See Supporting Affidavit at Exhibit. S-2].

When CIMB took steps to enforce the Order for Sale the Plaintiff’s solicitors appeared to resist the reduction of the reserve price. [See Afidavit Jawapan Defendan Pertama paragraphs 10(a) to (e) and Exhibit. L-1 and L-2].

CIMB then agreed to withdraw the enforcement of the Order for Sale after the Plaintiff and the 2nd Defendant suggested to CIMB to reschedule their repayments. [See Afidavit Jawapan Defendan Pertama at paragraph 10 (f)].

However, no settlement was achieved. So CIMB resumed the enforcement of the Order for Sale. The Plaintiff via her solicitors then requested for the redemption statement. This was supplied by CIMB on 17-08-2022 but the loan was not repaid and the Charge not redeemed by the Plaintiff. [See Afidavit Jawapan Defendan Pertama at paragraph 10 (g) to (l)]. Court Proceedings S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 7

Thereafter, the Plaintiff filed this Originating Summons in an attempt to set aside the Order for Sale. Issues before this court Issue [a] Does this Court have jurisdiction to set aside the Order for Sale based on Badiaddin?

I begin by examining the law prior to Badiaddin.

Prior to Badiaddin, a fresh suit can only be filed to set aside a judgment regularly obtained that has been drawn up if the order has been obtained by fraud or where further evidence which could not possibly have been adduced at the original hearing is forthcoming. The fact that the order is made in breach of statute and is illegal is not a ground for a fresh suit to set aside the earlier order. This is the decision of the Federal Court in Hock Hua Bank Bhd v Sahari Bin Murid [1981] 1 MLJ 143 where Chang Min Tat FJ said-Clearly the court has no power under any application in the same action to alter vary or set aside a judgment regularly obtained after it has been entered or an order after it is drawn up, except under the slip rule … so far as is necessary to correct errors in S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 8 expressing the intention of the court: … unless it is a judgment by default or made in the absence of a party at the trial or hearing. But if a judgment or order has been obtained by fraud or where further evidence which could not possibly have been adduced at the original hearing is forthcoming, a fresh action will lie to impeach the original judgment: … [Emphasis added]

Subsequently, in 1998 the Federal Court in Badiaddin added a further exception to the two categories of fraud or further evidence set out in Hock Hua Bank Bhd v Sahari Bin Murid [1981] 1 MLJ 143.

I begin by examining the ratio decidendi [A Latin phrase meaning "the reason" or "the rationale for the decision"] of Badiaddin.

In Badiaddin the Federal Court held that in “exceptional cases” even if there is no fraud or further evidence involved, a losing party need not appeal, but can subsequently file a fresh action to set aside the earlier final order that had been regularly obtained and drawn up. This fresh action is not barred by the doctrines of functuos officio or res judicata.

What then are these “exceptional cases”? In Badiaddin the grounds of judgment of Mohd Azmi FCJ had the agreement of S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 9 Eusoff Chin CJ and Wan Adnan FCJ. Gopal Sri Ram JCA issued a separate grounds of judgment ad idem [Latin meaning “meeting of minds”] with Mohd Azmi FCJ . Peh Swee Chin FCJ also issued a separate grounds of judgment but he disagreed with the reasoning of the other four judges. Thus, Justice Peh in effect was the dissenting judge in the ratio decidendi of Badiaddin !

In his seminal passage for the majority judgment, Mohd Azmi FCJ said at p 409 – It is of course settled law as laid down by the Federal Court in Hock Hua Bank's case that one High Court cannot set aside a final order regularly obtained from another High Court of concurrent jurisdiction. But one special exception to this rule (which was not in issue and therefore not discussed in Hock Hua Bank) is where the final judgment of the High Court could be proved to be null and void on ground of illegality or lack of jurisdiction so as to bring the aggrieved party within the principle laid down by a number of authorities culminating in the Privy Council case of Isaacs v Robertson [1985] AC 97 where Lord Diplock while rejecting the legal aspect of voidness and voidability in the orders made by a court of unlimited jurisdiction, upheld the existence of a category of orders of the court '… which a person affected by the order is entitled to apply to have set aside ex debito justitiae in the exercise of the inherent jurisdiction of the court, without his needing to have recourse to the rules that deal expressly with proceedings to set aside orders for irregularity, and give to the judge a discretion as to the order he will make'. S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 10 The Privy Council through Lord Diplock also emphasized that the courts in England have not closed the door as to the type of defects in the final judgment of the court that can be brought into the category that attracts ex debito justitiae the right to have it set aside without going into the appeal procedure, 'save that specifically it includes orders that have been obtained in breach of rules of natural justice'… For my part, I must hasten to add that apart from breach of rules of natural justice, in any attempt to widen the door of the inherent and discretionary jurisdiction of the superior courts to set aside an order of court ex debito justitiae to a category of cases involving orders which contravened 'any written law', the contravention should be one which defies a substantive statutory prohibition so as to render the defective order null and void on ground of illegality or lack of jurisdiction. It should not for instance be applied to a defect in a final order which has contravened a procedural requirement of any written law. The discretion to invoke the inherent jurisdiction should also be exercised judicially in exceptional cases where the defect is of such a serious nature that there is a real need to set aside the defective order to enable the court to do justice. In all cases, the normal appeal procedure should be adopted to set aside a defective order, unless the aggrieved party could bring himself within the special exception. [Emphasis added] S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 11

In his separate Grounds of Judgment Gopal Sri Ram JCA said at p 426E-It is one thing to say that an order of a court of unlimited jurisdiction must be obeyed until it is set aside. It is quite a different thing to say that a court of unlimited jurisdiction may make orders in breach of written law. … I take it to be well settled that even courts of unlimited jurisdiction have no authority to act in contravention of written law. Of course, so long as an order of a court of unlimited jurisdiction stands, irregular though it may be, it must be respected. But where an order of such a court is made in breach of statute, it is made without jurisdiction and may therefore be declared void and set aside in proceedings brought for that purpose. It is then entirely open to the court, upon the illegality being clearly shown, to grant a declaration to the effect that the order is invalid and to have it set aside. It is wrong to assume that such an order may only be corrected on appeal. [Emphasis original and also added]

As stated earlier, Peh Swee Chin FCJ in his separate grounds of judgment disagreed with the reasoning of the other four judges. He said at – Page 413 D I have read all the written grounds of judgment since the conclusion of the hearing of the appeal when we allowed the appeal S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 12 thereat with costs and set aside the order of the court below. It is my misfortune and sorrow as well that I have been unable to agree with such grounds or reasoning and perforce with the greatest respect I have to give my point of view to which I have also committed myself in certain earlier judgments which I have delivered… Page 418F to 419 H I now deal with illegality as a ground for setting aside a previously perfected order (ie the said previous order) made in another action by filing a fresh action or proceeding out of time of an appeal against the said previous order. It will be remembered the second order of sale of the said land was set aside by all other members of the Federal Court on ground of illegality because of s 13 of the said Enactment. It is true that the Federal Court in Hock Hua Bank v Sahari bin Murid did say that a judgment could be set aside or impeached in a subsequent fresh action on the ground that such judgment was obtained, eg by fraud. Would it follow that if fraud in obtaining a judgment is sufficient as a ground, a fortiori, illegality touching a judgment would also suffice similarly for setting it aside? My answer to this is negative. Now, the case of Hock Hua Bank v Sahari bin Murid does not mention such a ground of illegality. … If a party complains of an illegality in a contract, eg when the consideration or object of the agreement is forbidden by statute and therefore unlawful, he must plead it or the court itself takes S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 13 judicial notice of it when the contract is ex facie illegal or evidence about it clearly emerges in court. All these presupposedly must take place and must have taken place either at the trial of the first instance, or in any direct appeal to a higher court therefrom as the case may be. The court if it did not deal with the illegality in any way aforesaid, would be functus officio and cannot take the point after a judgment is perfected, the point not being one of the exceptions covered by, eg the ratio of Hock Hua Bank v Sahari bin Murid. Further, a point of illegality could not be reserved by a litigant for future use without deploying it at the trial or in an appeal therefrom. A court cannot outside the scope of such trial and such appeal therefrom at any time thereafter take judicial notice of such point pleaded as an afterthought in a later action filed also as an afterthought. The doctrine of res judicata, it having been based, inter alia, also on the high policy of interest rei publicae ut finis litium, would prevent these afterthoughts (see Asia Commercial Finance (M) Bhd v Kawal Teliti Sdn Bhd [1995] 3 MLJ 189 and Scotch Leasing Sdn Bhd (In receivership) v Chee Pok Choy & Ors). [Emphasis added]

The dissenting reasoning of Peh Swee Chin FCJ found support in a subsequent Federal Court decision. The correctness of the majority reasoning in Badiaddin was doubted by Abdul Hamid Mohamad CJ in Hong Leong Bank Bhd (formerly known as Hong Leong Finance Bhd) v Staghorn Sdn Bhd and other appeals [2008] 2 MLJ 622 FC. [“Staghorn”].

This is what Abdul Hamid Mohamad CJ said In Staghorn - S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 14

It is not my intention to make a detailed analysis or give any final opinion on Badiaddin's case, except to make a few points. First, in Badiaddin, the appellants commenced a fresh action to have the second order of the High Court declared null and void and to have it set aside on the ground that it contravened the provisions of s 13 of the Malay Reservations Enactment (FMS Cap 142.) This court in that case was dealing with the inherent jurisdiction of the court to set aside a final order. The judgment of this court on that issue was a split decision: Mohd Azmi FCJ and Gopal Sri Ram JCA were of the view that it could be done while Peh Swee Chin FCJ disagreed. Even Azmi FCJ talked about the 'extraordinary circumstances' of the case and said that 'the contravention should be one which defies a substantive statutory prohibition so as to render the defective order null and void on ground of illegality or lack of jurisdiction.' The learned judge further added that 'The discretion to invoke the inherent jurisdiction should also be exercised judicially in exceptional cases where the defect is of such a serious nature that there is a real need to set aside the defective order to enable the court to do justice.

... So, Badiaddin, at that stage, is not relevant. So, even if Badiaddin is good law, it is not relevant in an application to intervene under O 15 r 6 of the RHC. Itis, as in that case, relevant in considering whether the previous order of the court could be set aside, in a fresh action.

Secondly, it is one thing for the apex court to look at the order of a lower court and say that the order is null and void because it S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 15 contravenes a written law, especially as in Badiaddin where the contravention is glaring. But, let us reverse the position. Let us assume that a case has reached the Federal Court and that the Federal Court has made an order. Subsequently, the losing party commences a fresh action in the High Court to set aside the order on the ground of illegality for contravention with a written law. Following Badiaddin and the dictum in Eu Finance Bhd the High Court would be at liberty to reopen the case, declare the Federal Court order null and void and set it aside! I dread to think of such a situation.

Even where it involves a judgment of a court of co-ordinate jurisdiction, a second judge scrutinizing an earlier judgment or order of another judge may easily find a point which he disagrees with, even in law. Maybe that point was not even raised or argued before the first judge. As a matter of judicial policy, should the second judge be allowed to reopen the case, set aside the earlier judgment or order and substitute it with his own? If he can do it, why can't a third judge do the same with the second judge's order, and so on? That will encourage 'judge shopping.' The same process can also happen at every level of the court system.

The abuse voiced by Peh Swee Chin FCJ eg where he said 'Further, a point of illegality could not be reserved by a litigant for future use without deploying it at the trial or in an appeal therefrom' should not be taken lightly. That is exactly what had happened in this case. [Emphasis added] S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 16

In the recent Court of Appeal case of David Cheah Seng Chye [bringing this action for and on behalf of himself and the beneficiaries of the Estate of Cheah Leong Keah deceased] v So Miau Song & 5 others [2023] MLJU 414 CA after reviewing Badiaddin, Lim Chong Fong JCA said –

…a plaintiff may only initiate a fresh action to impeach a regular judgment earlier obtained in the original action in limited categories of illegality, lack of jurisdiction or fraud. [Emphasis added] Is delay in filing the fresh suit a relevant factor?

Whether or not delay bars the filing of the fresh suit and whether the delay needs to be explained were not considered by the Federal Court in Badiaddin. The facts in Badiaddin show that the fresh suit was filed in 1995 to declare an order for sale made on 08-10-1990 null and void and to have it set aside on the ground that it contravened Section 13 of the Malay Reservations Enactment [FMS Cap 142]. [See Badiaddin at p 415D and 424D].

The Plaintiff submits that delay is not a relevant factor. The Plaintiff submits that in an application to set aside an order for sale granted in the absence of the chargor or its solicitors though duly served, the Federal Court in Perwira Habib Bank Malaysia Bhd v Lum Choon S/N 5fNWsoXXkmsiranHl4W6g **Note : Serial number will be used to verify the originality of this document via eFILING portal 17 Realty Sdn Bhd [2006] 5 MLJ 21 FC by a 2-1 majority decision allowed the application though the delay was close to 5 years. [See Grounds of Judgment paragraphs [13] and 142].This is what PS Gill FCJ said-

As to the question of delay in applying to set aside the order for sale by the respondent, in our view, lapse of time is no bar to the respondent's application to set aside an order for sale that is so fundamentally flawed. We are supported by the following passage in a judgment of the Federal Court in case of Tuan Haji Ahmed Abdul Rahman v Arab-Malaysian Finance Bhd [1996] 1 MLJ 30 at p 42 Nevertheless, it is clear law that the court still retains a discretion to set aside an irregular judgment despite long delay, provided it is satisfied that:

No one has suffered prejudice by reason of the defendant's delay;

Alternatively, where such prejudice has been sustained, it can be met by an appropriate order as to costs; or

To let the judgment to stand would constitute oppression. (See Atwood v Chichester (1878) 3 QBD 722; Harley v Samson

30 TLR 450.) [Emphasis added] S/N 5fNWsoXXkmsiranHl4W6g [35] CIMB countered by relying on Malayan Banking Bhd v Koay Kang Chuwan & Anor [2010] 5 MLJ 46 where Abdul Malik Ishak JCA said- [37] The third ground was worded in this way. That the learned judge of the High Court erred in law in failing to dismiss the first respondent’s application to set aside the order for sale after a delay of ten years without giving any valid or reasonable reason for the delay. [38] It cannot be doubted that there was an inordinate delay of exactly 12 years nine months and six days. …At any rate, I have perused through the affidavit in support in question and it contained precious little. It failed to depose to any valid or reasonable reason for the extremely long delay… [40] It is our judgment that once the question of delay has been resolved in favour of the appellant bank, the merits of the appeal need not be examined. [41] Gopal Sri Ram JCA (later FCJ) writing for this court in Khor Cheng Wah v Sungai Way Leasing Sdn Bhd [1996] 1 MLJ 223 had occasion to consider the issue of delay and this was what His Lordship said (see pp 229–230 of the report): The delay point It is a cardinal principle of law, that when a litigant seeks the intervention of the court in a matter that affects his rights, he must S/N 5fNWsoXXkmsiranHl4W6g do so timeously. The maxim vigilantibus, non dormientibus, jura subveniunt, though having its origins in the Court of Chancery, is of universal application. Even in cases where a right is exercisable ex debito justitiae, a court may refuse relief to an indolent litigant. In all cases in which delay in approaching the court is in issue, the burden is upon the litigant who has delayed to render a satisfactory explanation for it. Whether the explanation in a given case is satisfactory or reasonable depends upon the facts and circumstances of each case. And in a matter which involves the exercise of discretion, it is for the judge in whom the law primarily vests the discretion. The point that is presently under consideration has been authoritatively stated in Tuan Haji Ahmed Abdul Rahman v Arab-Malaysian Finance Bhd [1996] 1 MLJ 30. It is a decision of the Federal Court and therefore quite plainly binds this court. There, Edgar Joseph Jr FCJ, said (at p 36): The general rule is that when it is clearly demonstrated to the satisfaction of the court that a judgment has not been regularly obtained, the defendant is entitled to have it set aside ex debito justicie, that is to say, irrespective of the merits and without terms. Having said that it should be added that the application to set aside such a judgment should be made: (a) with reasonable promptitude, in other words within a reasonable time; and (b) before the defendant has taken any fresh step after becoming aware of the irregularity (see O 2 r 2(1) of the Rules of the High Court 1980). S/N 5fNWsoXXkmsiranHl4W6g [Emphasis added] [36] It is interesting to note that both the Federal Court in Perwira Habib Bank Malaysia Bhd v Lum Choon Realty Sdn Bhd [2006] 5 MLJ 21 FC and the Court of Appeal in Malayan Banking Bhd v Koay Kang Chuwan & Anor [2010] 5 MLJ 46 cited the same case of Tuan Haji Ahmed Abdul Rahman v Arab-Malaysian Finance Bhd [1996] 1 MLJ 30 for their propositions on delay. [37] A closer reading of all these three [3] cases shows that the fresh suit or application to set aside an earlier order should be made:

With reasonable promptitude, in other words within a reasonable time;

Supported by explanation for any delay and

Before the defendant has taken any fresh step after becoming aware of the irregularity. Badiaddin today [38] Badiaddin is still good law unless and until varied or reviewed by a subsequent Federal Court decision. Until that happens, based on Badiaddin and the cases set out above, the following principles can be distilled. A fresh suit can only be filed to set aside an order regularly obtained that has been drawn up – S/N 5fNWsoXXkmsiranHl4W6g a) In the limited categories of illegality, lack of jurisdiction or fraud. b) The contravention of a statute should be one which defies a substantive statutory prohibition so as to render the defective order null and void on ground of illegality or lack of jurisdiction. c) The contravention of a procedural requirement of a statute is not a ground for a fresh suit to set aside the earlier regular judgment. d) The fresh suit or application to set aside should be made with reasonable promptitude, in other words within a reasonable time, supported by explanation for any delay and before the defendant has taken any fresh step after becoming aware of the irregularity. e) The discretion to invoke the inherent jurisdiction should be exercised judicially only in exceptional cases where the defect is of such a serious nature that there is a real need to set aside the defective order to enable the court to do justice. f) In all other cases, the normal appeal procedure should be adopted to set aside a defective order, unless the aggrieved party could bring himself within these special exceptions. Application of law to the facts of this case [39] In this Originating Summons the Plaintiff relied on two grounds to set aside the Order for Sale. They are - S/N 5fNWsoXXkmsiranHl4W6g a) The Order for Sale did not comply with Section 8[2A] of the Bankruptcy Act 1967 as CIMB had claimed for interest accruing on the loan after the making of the receiving order on the 2nd Defendant; and b) The supporting affidavit affirmed in the foreclosure Originating Summons, by CIMB, failed to comply with Order 83 rule 3[3] Rules of Court 2012 as no particulars of the amount remaining due under the charge as at the hearing date of the Originating Summons was furnished. [Emphasis added]. Do the two grounds satisfy the test set out in Badiaddin? [40] These two grounds, even if we assumed for a moment are valid, do not satisfy the test set out in Badiaddin. They do not fall within the limited categories of illegality, lack of jurisdiction or fraud. The alleged contraventions of Section 8[2A] of the Bankruptcy Act 1967 and Order 83 rule 3[3] Rules of Court 2012, even if true, are mere procedural contraventions and do not strike at the very heart or essence of the Charge. Has the Plaintiff explained the delay in her Originating Summons application? [41] The Plaintiff had failed to explain in her two affidavits the delay in her Originating Summons application save to put the blame on her S/N 5fNWsoXXkmsiranHl4W6g previous sets of solicitors. [see Reply Affidavit of Shu Fong Yean dated 25-11-2022 at paragraph 11]. [42] Further, the facts show that prior to the filing of this Originating Summons, the Plaintiff’s solicitors appeared in Court on her behalf not to disagreed with the auction but to resist the reduction of the reserve price. She then asked CIMB to reschedule their repayments. Thereafter, her solicitors then requested for the redemption statement. CIMB had agreed to withhold enforcement proceedings on the Order for Sale based on her requests. Such facts do not satisfy the test in Badiaddin, to quote, “there is a real need to set aside the defective order to enable the court to do justice.” On the merits [43] In any event even assuming the Plaintiff satisfies the test set out in Badiaddin there are no merits in the two grounds relied on by the Plaintiff to set aside the Order for Sale. First ground - Allegation that the Order for Sale did not comply with Section 8 [2A] of the Bankruptcy Act 1967 [44] Section 8[2A] of the Bankruptcy Act 1967 reads as follows - 8 Effect of receiving order […] S/N 5fNWsoXXkmsiranHl4W6g

Notwithstanding subsection (2), no secured creditor shall be entitled to any interest in respect of his debt after the making of a receiving order if he does not realize his security within six months from the date of the receiving order. [45] The Plaintiff alleged the Order for Sale had breached Section 8 [2A] of the Bankruptcy Act 1967 as CIMB had claimed for interest accruing on the loan after the making of the receiving order on the 2nd Defendant on 25-06-2017. [46] CIMB relies on clause 2.1 of the Charge [See Supporting Affidavit at Exhibit. S-4] which states expressly that in the event one of the borrowers is declared a bankrupt the other borrower i.e. the Plaintiff, who is not a bankrupt, is under a legal obligation to pay interest notwithstanding Section 8[2A] of the Bankruptcy Act 1967. [47] Under Malaysian law, joint borrowers of a loan are, in the absence of an express agreement to the contrary, each liable to the lender to repay the full liability for the loan. This is clearly stated in Section 44[1] of the Contracts Act 1950. [See Kiranjit Kaur Jagjit Singh v Thamabalasingam @ Thanabalasingam [2022] 6 MLRH 549 HC [119-120]. [48] The Federal Court in Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian a/l Nagappan @ Marie [2021] 5 MLJ 253 FC has this to say of Section 44[1] of the Contracts Act 1950. I respectfully adopt the same. Nallini Pathmanathan FCJ [Delivering judgment of the Court] said-S/N 5fNWsoXXkmsiranHl4W6g The position in Malaysia [24] In this jurisdiction in any event, the common law is inapplicable, as we are governed by the Contracts Act 1950. Section 44 of the Contracts Act 1950 (Act 136) (‘the Contracts Act’) is the relevant provision relating to joint liability. It states:

When two or more persons make a joint promise, the promisee may, in the absence of express agreement to the contrary, compel any one or more of the joint promisors to perform the whole of the promise. (Emphasis added.) [25] Section 44 of the Contracts Act is in pari materia with s 43 of the Indian Contract Act 1872. In Re Vallibhai Adamji, BJ Wadia observed that the provision: … makes the liability on all contracts joint and several, and allows the promisee to sue one or more of the several joint promisors as he chooses, and excludes the right of any one of them to be sued along with his co-promisor or co-promisors. (See also: Union of India v East Bengal River Steamer Service Limited 1963 Indlaw CAL 177; AIR 1964 Cal 196.) [26] In summary therefore, unless a contrary intention is expressed in the contract, all joint contracts effectively impose a full liability for the debt on each of the promisors, by virtue of s 43 of the Indian Contract Act 1872: see Pollock & Mulla: Indian S/N 5fNWsoXXkmsiranHl4W6g Contract and Specific Relief Acts, Vol 1 (13th Ed, India: LexisNexis, 2009) at pp 1043–1044. Thus, where the debts are jointly incurred, each promisee is liable for the whole amount: Dhanki Mahajan vs Rana Chandubha Wakhatsing & Ors 1969 AIR 69. [Emphasis added] [49] The Plaintiff had signed the Charge. She is bound by its terms. There are really no merits with respect to the contention of the Plaintiff in the face of clause 2.1 of the Charge. Second ground - Allegation that the supporting affidavit affirmed in the foreclosure Originating Summons, by CIMB, failed to comply with Order 83 rule 3[3] Rules of Court 2012 [50] The Plaintiff contends that the supporting affidavit affirmed in the foreclosure Originating Summons, by CIMB, failed to comply with Order 83 rule 3[3] Rules of Court 2012 as no particulars of the amount remaining due under the charge as at the hearing date of the Originating Summons was furnished. [Emphasis added]. [51] Order 83 rule 3[3] Rules of Court 2012 states as follows- “3. Action for delivery of possession or payment of moneys (O. 83 r. 3) … S/N 5fNWsoXXkmsiranHl4W6g

Where the plaintiff claims delivery of possession the affidavit shall show the circumstances under which the right to possession arises and, except where the Court in any case or class otherwise directs, the particulars of the amount remaining due under the charge as at the hearing date of the originating summons.” [Emphasis added] [52] CIMB contends Order 83 rule 3[3] Rules of Court 2012 does not apply as CIMB is not claiming for delivery of possession. I agree. Nowhere in the Order for Sale dated 02-07-2019 is there an order for delivery of possession. The Order for Sale can be seen in Supporting Affidavit at Exhibit. S-1. [53] In any event, CIMB contends that assuming that Order 83 rule 3[3] Rules of Court 2012 is applicable, it had given the particulars of the amount remaining due under the charge as at the hearing date of the originating summons. As evidence, CIMB refers to the statement of account exhibited in the Supporting Affidavit at Exhibit. S-5. [54] I agree. In the statement of account exhibited in the Supporting Affidavit at Exhibit. S-5, CIMB had clearly stated – “The above matter refers. We furnish herewith the statement of account as at 02.07.2019 for your further action. S/N 5fNWsoXXkmsiranHl4W6g 8002284695 a. Amount Outstanding as at 02.07.2019 RM 479,351.50 8002341093 a.Amount Outstanding as at 02.07.2019 RM 398,894.23 [55] Further, the Plaintiff had never identified what are these ‘particulars’ that CIMB had failed to show. The Plaintiff in its Written Submissions had been vague on what particulars CIMB had failed to state other than rely on the Court of Appeal case of Lum Choon Realty Sdn. Bhd. v Perwira Habib Bank Malaysia Bhd [2003] 4 MLJ 409 which held that a chargor must give the particulars required under O 83 r 3[1] Rules of the High Court 1980. [56] I have two observations to make. First, the Court of Appeal case of Lum Choon Realty Sdn. Bhd. v Perwira Habib Bank Malaysia Bhd [2003] 4 MLJ 409 CA went up on appeal and the decision is reported as Perwira Habib Bank Malaysia Bhd v Lum Choon Realty Sdn Bhd [2006] 5 MLJ 21 FC. [57] Second, Perwira Habib Bank Malaysia Bhd v Lum Choon Realty Sdn Bhd [2006] 5 MLJ 21 FC is actually a case on Order 83 rule 3[1] Rules of the High Court 1980, the predecessor to our Rules of Court 2012. [58] In Order 83 rule 3[1] Rules of the High Court 1980 there is a requirement to state the amount of the advance, the amount of the S/N 5fNWsoXXkmsiranHl4W6g repayments, the amount of any interest or instalments in arrears at the date of issue of the originating summons and at the date of the afidavit; and the amount remaining due under the charge. The requirement to state such particulars was deleted in the new Order 83 rule 3[3] Rules of Court 2012. [59] A case on point is CIMB Islamic Bank Bhd v David Chua Kok Tee [2022] MLJU 537 where Azlan Sulaiman JC said- “[21] I would also reject this contention. All that the Plaintiff needs to adduce under sub-rules 3(3) and 3(6) are particulars of the amount remaining due under the charge as at the date of hearing. The Latest Statement of Account does that. Order 83 rules 3(3) and 3(6) of the Rules of Court, 2012 do not require the Plaintiff to provide any explanation or particulars as to how these amounts were derived. [22] As for the case of Bank Pertanian Malaysia v Zainal Abidin bin Kassim & Anor [1995] 2 MLJ 537 the Defendant relies on, I would distinguish it on the simple fact that it was decided under the previous Rules of the High Court, 1980 then in force. At the time, Order 83 rules 3(3) and 3(6) of those Rules required the charge to adduce these details for the hearing of the originating summons:

the amount of the advance;

the amount of the repayments; S/N 5fNWsoXXkmsiranHl4W6g

the amount of any interest or instalments in arrears at the date of issue of the originating summons and at the date of the affidavit; and

the amount remaining due under the charge. [23] Under the current Order 83 rules 3(3) and 3(6) the chargee need only provide the amount remaining due under the charge.” [60] Therefore, I hold that there are no merits in the second issue raised by the Plaintiff that the Supporting Affidavit affirmed in the foreclosure Originating Summons, by CIMB, failed to comply with Order 83 rule 3[3] Rules of Court 2012. Decision [61] I therefore dismiss the Plaintiff’s Originating Summons with costs. S/N 5fNWsoXXkmsiranHl4W6g Postscript [62] I would observe that even if the Order for Sale is set aside, the loan still has to be repaid by the Plaintiff. It does not go away. CIMB is always at liberty to refile a fresh foreclosure. ………(signed)…..……. Leong Wai Hong Judicial Commissioner High Court of Malaya Kuala Lumpur (NCVC 10) Dated: 3rd April 2023 COUNSEL: 1) Lau Yi Leong for Plaintiff. (Ling & Yi Leong (Petaling Jaya)) 2) Lee Tze Jiun for 1st Defendant. (Zairina Loh & Wong (Kuala Lumpur)) 3) Norizan binti Omar for 2nd Defendant. S/N 5fNWsoXXkmsiranHl4W6g (Jabatan Insolvensi Malaysia Wilayah Persekutuan Kuala Lumpur (Kuala Lumpur)) CASES REFERRED TO: 1) Asia Commercial Finance (M) Bhd v Kawal Teliti Sdn Bhd [1995] 3 MLJ 189 SC. 2) Atwood v Chichester (1878) 3 QBD 722. 3) Badiaddin bin Mohd Mahidin v Arab Malaysian Finance Bhd [1998] 1 MLJ 393 FC. 4) Bank Pertanian Malaysia v Zainal Abidin bin Kassim & Anor [1995] 2 MLJ 537 HC. 5) CIMB Islamic Bank Bhd v David Chua Kok Tee [2022] MLJU 537 HC. 6) David Cheah Seng Chye [bringing this action for and on behalf of himself and the beneficiaries of the Estate of Cheah Leong Keah deceased] v So Miau Song & 5 others [2023] MLJU 414 CA. 7) Dhanki Mahajan vs Rana Chandubha Wakhatsing & Ors 1969 AIR

8) Harley v Samson (1914) 30 TLR 450. 9) Hock Hua Bank Bhd v Sahari Bin Murid [1981] 1 MLJ 143 FC. 10) Hong Leong Bank Bhd (formerly known as Hong Leong Finance Bhd) v Staghorn Sdn Bhd and other appeals [2008] 2 MLJ 622 FC. 11) Isaacs v Robertson [1985] AC 97. 12) Khor Cheng Wah v Sungai Way Leasing Sdn Bhd [1996] 1 MLJ 223 CA. S/N 5fNWsoXXkmsiranHl4W6g 13) Kiranjit Kaur Jagjit Singh v Thamabalasingam @ Thanabalasingam [2022] 6 MLRH 549 HC. 14) Lembaga Kumpulan Wang Simpanan Pekerja v Edwin Cassian a/l Nagappan @ Marie [2021] 5 MLJ 253 FC. 15) Lum Choon Realty Sdn. Bhd. v Perwira Habib Bank Malaysia Bhd [2003] 4 MLJ 409 CA. 16) Malayan Banking Bhd v Koay Kang Chuwan & Anor [2010] 5 MLJ 46 CA. 17) Perwira Habib Bank Malaysia Bhd v Lum Choon Realty Sdn Bhd [2006] 5 MLJ 21 FC. 18) Scotch Leasing Sdn Bhd (In receivership) v Chee Pok Choy & Ors [2000] 7 MLJ 253 HC. 19) Tuan Haji Ahmed Abdul Rahman v Arab-Malaysian Finance Bhd [1996] 1 MLJ 30 FC. 20) Union of India v East Bengal River Steamer Service Limited 1963 Indlaw CAL 177; AIR 1964 Cal 196. LEGISLATION REFERRED TO: 1) Section 8[2A] of the Bankruptcy Act 1967. 2) Section 13 of the Malay Reservations Enactment. 3) Section 43 of the Indian Contract Act 1872. 4) Section 44 of the Contracts Act 1950. 5) Order 83 Rule 3[3] of the Rules of Court 2012. 6) Order 83 Rule 3[6] of the Rules of Court 2012. 7) Order 2 Rule 2 (1) of the Rules of High Court 1980. 8) Order 15 Rule 6 of the Rules of High Court 1980. S/N 5fNWsoXXkmsiranHl4W6g BOOK REFERRED TO: 1) Cornelius Ryan’s World War 2 classic A Bridge Too Far. 2) Pollock & Mulla: Indian Contract and Specific Relief Acts, Vol 1 (13th Ed, India: LexisNexis, 2009) S/N 5fNWsoXXkmsiranHl4W6g