W T Steel Sdn Bhd v 1. ) Svr Builders (M) Sdn Bhd (WA-22NCC-699-12/2022)

SVR BUILDERS (M) SDN BHD (formerly known as SVR ENGINEERING SDN BHD) [COMPANY NO .: 200901001042 (843966-D)]

VIKNESWARAN A/L RAJA GOBAL [NRIC NO. : 710102-10-6903]

ARUMUGAM A/L PALANIAPPAN [NRIC NO. : 760528-01-6759] ... DEFENDANTS GROUNDS OF JUDGMENT Introduction [1] Enclosure (“Enc.”) 12 is the Plaintiff’s application for summary judgment pursuant to Order 14 of the Rules of Court 2012 (“ROC 2012”) against the Defendants. Background [2] The Plaintiff is in the business of supplying or selling iron and/or steel materials. [3] By a credit application signed by the 2nd and 3rd Defendants on 6.2.2017, as Directors of the 1st Defendant, the 1st Defendant applied to the Plaintiff, and the Plaintiff agreed to sell, supply and deliver goods to the 1st Defendant. [4] It was a term of supply that the Plaintiff is entitled to impose interest at the rate of 1.5% per month on all outstanding sums due and owing in respect of the supply. This rate of interest was set out in Clause 4 of the Terms and Conditions of Sale in the credit application form signed by both the 2nd and 3rd Defendants. [5] In consideration of the Plaintiff agreeing to supply or to continue the supply of goods and/or to give credit to the 1st Defendant, the 2nd and 3rd Defendants executed a letter of guarantee and indemnity dated 6.2.2017 in favour of the Plaintiff wherein the 2nd and 3rd Defendants jointly and/or severally guaranteed the repayment of all monies owed by the 1st Defendant to the Plaintiff as principal and not merely as sureties together with interest, costs and expenses (including but not limited to legal charges on a solicitor-client basis) which the Plaintiff may incur or sustain by reason of the failure on the part of the 1st Defendant to pay all monies due to the Plaintiff ("the guarantee"). [6] At all material times, the Plaintiff did supply various iron and/or steel materials of different sizes and/or quantities to the 1st Defendant from the Plaintiff. [7] As at 31.10.2022, there was a sum owing of RM1,036,795.98 made up of late payment interest and the principal sum of RM854,150.21 due and owing to the Plaintiff comprising the following invoices: No. Invois No.

2110297 25/10/2021 89,042.21

(ii) 2110298 25/10/2021 212,790.00

(iii) 2110299 25/10/2021 50,383.00

(iv) 2110300 25/10/2021 53,142.00

2110320 26/10/2021 111,360.00

(vi) 2110338 27/10/2021 215,431.50

(vii) 2110384 29/10/2021 97,139.00

(viii) 2110385 29/10/2021 20,822.00

(ix) 2111222 17/11/2021 2,766.50

2201/058 5/1/2022 1,274.00 TOTAL 854,150.21 [8] The invoices were for the delivery orders as follows: No. Delivery Order No.

2110297 25/10/2021

(ii) 2110300 25/10/2021

(iii) 2110320 26/10/2021

(iv) 2110338 27/10/2021

2110384 29/10/2021

(vi) 2111222 17/11/2021

(vii) 2110298 25/10/2021

(viii) 2110299 25/10/2021

(ix) 2110385 29/10/2021

2201/058 5/1/2022 [9] The Plaintiff issued through its solicitors, a demand dated 9.11.2022 for the sum of RM1,036,795.98 as at 31.10.2022 to all the Defendants. [10] The 2nd Defendant by letter dated 7.12.2022 responded to the Plaintiff's solicitor's letter, stating that the guarantee was allegedly entered by the 2nd Defendant for a different project and that the 2nd Defendant had resigned as a director since 2.12.2019 before the purchase orders were placed on 22.7.2021. The 3rd Respondent alleged that he had similarly responded to the Plaiantiff’s demand of 9.11.2022. [11] No payment was made, and hence this action was filed by the Plaintiff to claim a sum of RM1,049,608.23 comprising the principal sum of RM854,150.21 together with late payment interest as at 30.11.2022 of RM195,458.02. The Defendants’ case [12] In resisting summary judgment, the Defendants contended:

1st Defendant

12.1 The Plaintiff had submitted invoices and delivery orders, but not all invoices and delivery orders were acknowledged by the 1st Defendant, there were a few invoices that were not acknowledged and objected to by the 1st Defendant who did not receive a response from the Plaintiff;

12.2 Parties have a relationship since 2017, the Plaintiff at all material times has never charged interest at the rate of 1.5% to the 1st Defendant and never gave any warning regarding the interest charged to the1st Defendant;

12.3 It is a practice between the parties that if there is any complaint, the Defendant will inform the Plaintiff orally and the Plaintiff regardless of the time period of the complaint will replace the steel material that has been damaged or defective and the Plaintiff will send a new invoice after the defect is verified. However, to this day a new invoice has never been issued;

12.4 The 1st Defendant do not owe the sum of RM1,036,795.98;

12.5 The Plaintiff did not disclose any facts regarding the payment that had already been made by the 1st Defendant to the Plaintiff; and

12.6 The 1st Defendant had never received any claim notice; only the 2nd and 3rd Defendants had received the Plaintiff's Claim Notice

(ii) 2nd and 3rd Defendants

12.7 Both Defendants have no knowledge about the supplies made from 25.10.2021 to 5.1.2022 as the 2nd and 3rd Defendants have respectively resigned as Directors of the 1st Defendant on 2 December 2019 and 21 January 2021; the documents related to the resignation as a director had already been completed with the company secretary;

12.8 The guarantee they signed is for a project in 2017 and not for the supplies made from 25.10.2021 to 5.1.2022; it is “an abuse of power and a violation of "public policy” for the Plaintiff to use the guarantee in 2021;

12.9 For the project in 2017 itself, the amount agreed as "credit limit" is only RM150,000.00;

12.10 The Application for Credit Facilities relied upon by the Plaintiff does not state the amount of "credit limit" and "Payment terms”;

12.11 The Purchase Orders do not state the names of the 2nd and 3rd Defendants and this shows that the 2nd and 3rd Defendants were not involved in the transaction;

12.12 It was additionally contended by the 3rd Defendant that he was away in Bangladesh on work when the orders and deliveries were made and this shows he was not involved with the transactions;

12.13 Based on the matters stated above, the Plaintiff’s claim is an abuse of court process. [13] After considering the rival position of the parties, in effect, the issues to me are:

13.1 Whether the 1st Defendant has ordered and received the alleged goods and hence liable to pay the Plaintiff the sum claimed?

13.2 Whether the 1st Defendant applied for and accepted the credit facility application?

13.3 Whether the Plaintiff is entitled to charge interest at 1.5% for late payment;

13.4 Whether the guarantee is enforceable against the 2nd and 3rd Defendants? Law on Summary Judgment Applications [14] As to the Court’s function in hearing an application under Order 14, it will be useful to recall the authoritative pronouncements of the Federal Court in National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300; [1984] 2 CLJ 220: “We think it appropriate to remind ourselves once again that in every application under Order 14 the first considerations are (1) whether the case comes within the Order and (b) whether the Plaintiff has satisfied the preliminary requirements for proceeding under Order 14. For the purposes of an application under Order 14 the preliminary requirements are:

the Defendant must have entered an appearance;

(ii) the statement of claim must have been served on the defendant; and

(iii) the affidavit in support of the application must comply with the requirements of Rule 2 of the Order 14. It is to be observed that a case is not within Order 14 (a) where no statement of claim has been served on the defendant; (b) where the indorsement on the writ includes a claim or claims outside the scope of Order 14 as coming within Rule 1(2); (c) where the affidavit in support of the application is defective, e.g. in omitting to state the deponent's belief that there is no defence to the claim or part to which the application relates; (d) where the application is made in an action against the Government [Order 73 Rule 5(1)]. If the Plaintiff fails to satisfy either of these considerations, the summons may be dismissed. If, however, these considerations are satisfied, the Plaintiff will have established a prima facie case and he became entitled to judgment. The burden then shifts to the defendant to satisfy the Court why judgment should not be given against him [see Order 14 Rules 3 and 4(1)].” [15] It is important to be reminded that in an O.14 ROC 2012 application for summary judgment, the Court must look at the matter as a whole, and ask itself whether the defendant has satisfied the Court that there is an issue or question in dispute which ought to be tried, and if he cannot, he has to show there ought for “some other reason to be a trial” of that claim or part of the claim pursuant to O. 14 r. 3(1) ROC 2012. [16] Where a defendant is able to demonstrate facts to show that he has raised a defence or reasonable grounds for setting up a defence or even a fair probability that he has a bona fide defence, he ought to be given leave to defend. This discretion lies with the judge. [17] It is also to be borne in mind that the defendant must raise an arguable issue that requires a trial in order to determine it: Voo Min En & Ors. v Leong Chung Fatt [1982] 2 MLJ 241. [18] In Bank Negara Malaysia v Mohd Ismail Ali Johor & Ors [1992] 1 MLJ 400, the Supreme Court succinctly summarized the approach to be taken in dealing with the affidavits: “Under O. 14 when a fact is asserted by one party and denied by another, and such denial is equivocal or lacking in precision or is inconsistent with undisputed contemporary documents or other statement by the same deponent or is inherently improbable in itself, the judge has a duty to reject such assertion or denial, thereby rendering the issue as not triable. In our opinion, unless this principle is adhered to, a Judge is in no position to exercise his discretion judicially under an O.14 application. Thus, apart from identifying the issues of fact or law, the Court must go one step further and determine whether they are triable. This principle is sometimes expressed by the statement that a complete defence need not be shown. The defence set up need only show that there is a triable issue. Where the issue raised is solely a question of law without reference to any facts or where the facts are clear and undisputed, the court should exercise its duty under O 14. If the legal point is understood and the court is satisfied that it is unarguable, the court is not prevented from granting a summary judgment merely because 'the question of law is at first blush of some complexity and therefore takes a little longer to understand'. (See Cow v Casey 6 and European Asian Bank AG v Punjab & Sind Bank 7 at p 516.)” [19] The principle governing the exercise of power under O.14 of the Rules of Court 2012 was stated in Jacobs v Booth Distillery Co. [1901] 85 LT 262 where Halsbury LC observed: “People do not seem to understand that the effect of Order 14 is that, upon the allegation of the one side or the other, a man is not to be permitted to defend himself in court; that his rights are not to be litigated at all. There are something too plain for argument; and when there were pleas put in simply for the purpose of delay which only added to the expense, and where it was not in aid of justice that such things should continue, Order 14 was intended to put an end to that state of things, to prevent sham defences, from defeating the right of parties by delay, and at the same time causing great loss to the Plaintiff s who were endeavouring to enforce their rights.” [20] In Southern Finance Bhd v Sun City Development Sdn Bhd & Anor [2006] 7 CLJ 464, it was held: “The general principle is where a Defendant shows that he has a fair case for defence or reasonable grounds for setting up a defence or even a fair probability that he has a bona fide defence he ought to be given leave to defend (Saw v.Hakim 5 TLR 72). A Defendant should not be shut out from defending unless it is very clear indeed that he has no case in the action under discussion (Sheppards v. Wilkinson 6 TLR 13). The power to give summary judgment under O. 14 is “intended only to apply to cases where there is no reasonable doubt that a Plaintiff is entitled to judgment and where therefore it is inexpedient to allow a Defendant to defend for mere purposes of delay”. (Jones v.Stone [1894] AC 122). Where there is any serious conflict to matters of fact or where any real difficulty as to matters of law arises, summary judgment under O. 14 should not be granted. (Electric and General Corpn. v.Thomson-Houston Electric 10 TLR 103). But, however difficult the point of law is, once it is understood and the Court is satisfied that it is really unarguable it will give final judgment (Cow v. Casey [1949] 1 KB 481). (See Percetakan Solai Sdn Bhd v. Kin Kwok Daily News Sdn Bhd & Anor [1985] CLJ (Rep) 632 at p. 637).” [21] The Defendants need only raise one triable issue to be given leave to defend — South East Asia Insurance Bhd v Kerajaan Malaysia [1996] MLJU 642; [1998] 1 CLJ 1045; HSBC Bank Malaysia Bhd v Ng Tien Beng & Ors [2008] 9 CLJ 631; Stamford College Bhd v Iris Corp Bhd [2014] 8 MLJ 178. Findings and Decision of this Court [22] Following the requirements set out by the Federal Court in National Company for Foreign Trade (supra), I find on the facts of this case, the Plaintiff has satisfied the preliminary requirements that the Order 14 application has been properly filed and thus have established a prima facie case, and became entitled to judgment. The burden has then shifted to the Defendants to satisfy the Court why judgment should not be given against them. [23] With the foregoing legal principles in mind, and having examined in detail the affidavits to see if 'there is a fair or reasonable probability of the Defendants having a real or bona fide defence’, I find that the issues raised by the Defendants are not triable issues or issues which warrant a trial. This Court finds that the Plaintiff’s claim is clearly incontestable and that it is a suitable case to be disposed of summarily (see Bank Negara Malaysia v Mohd Ismail (supra). [24] I deal with the issues raised by the Defendants. Triable issues? Whether the 1st Defendant applied for and accepted the Credit Facility Application? [25] I would take the 2nd issue first. [26] I note that the credit facility application was signed by the 2nd and 3rd Defendants as directors of the 1st Defendant and bears the 1st Defendant’s chop. These 2 directors have not denied signing the credit facility application form. Neither did the 1st Defendant deny that it was not its company chop on the credit facility application form. The terms in there as such are binding on the 1st Defendant. Whether the 1st Defendant has ordered and received the alleged goods and hence liable to pay the Plaintiff the sum claimed? [27] At the outset, it ought to be borne in mind that the burden is on the 1st Defendant to show why summary judgment should not be entered. [28] In postulating that not all invoices and delivery orders were acknowledged by the 1st Defendant and that there were a few invoices that were not acknowledged and objected to by the 1st Defendant who did not receive a response from the Plaintiff, or that based on oral complaints the Plaintiff will replace the steel material that has been damaged or defective and the Plaintiff will send a new invoice after the defect is verified; I find these assertions to be bare assertions and bereft of merits as there is an abject failure on the 1st Defendant’s part to condescend into details on what the ‘oral’ complaints were and what goods and invoices were not received. Neither was there any contemporaneous documents to lend a credible basis to such complaints. Weighing these bare assertions against each delivery order which bears the 1st Defendant’s company stamp of acknowledgment of receipt of goods in good order and condition, it is patently obvious that the 1st Defendant is clutching at straws. Again, it is worth noting that it is not the Defendants’ case that the 1st Defendant’s company stamp is fake or fictitious. In any case, bare denials or assertions do not constitute evidence and they cannot give rise to triable issues - Chen Heng Ping @ Tian Seow Hock & 5 Ors v. Intradagang Merchant Bankers (M) Berhad [1995] 3 CLJ 690. [29] In supporting its claim, the Plaintiff has produced in court the purchase orders, delivery orders and the invoices for the goods:

29.1 the purchase orders at exhibit WT-1;

29.2 delivery orders at exhibit WT-2;

29.3 the invoices at exhibit WT-3 and Exhibit WT-4 shows clearly all invoicies were sent to the 1st Defendant; and

29.4 the statement of account at exhibit WT-11. [30] These documents produced by the Plaintiff collectively constitute a binding contract which has been reduced into writing – see Caltex Oil Malaysia Ltd v Classic Best Sdn Bhd & Ors [2007] 4 MLJ 772 where Suriyadi J (as he then was) held as follows: “In coming to a decision in cases involving goods sold and delivered such as in this case, I would place due emphasis on the written documents, delivery notes and the debit notes. These documents would collectively constitute a contract reduced into writing.” [31] In this case, each delivery order in exhibit WT-2 not only bears an acknowledgment of receipt of goods in good order and condition, it also contains a statement to the effect that if there are any discrepancies, the 1st Defendant must inform the Plaintiff in writing within a period of seven (7) days after receiving the goods. If there is no such notice / "remarks" from the 1st Defendant within the 7-day period, the Plaintiff's account will be considered correct. Each invoice in exhibit WT-3 sent to the 1st Defendant as evidenced by exhibit WT- 4 also embodied the same statement. [32] The law that the 1st Defendant is estopped in the circumstances as obtained here from now asserting that the amount claimed is not due is well settled by a line of frequently cited authorities. See for example: i. Boustead Trading Sdn Bhd-v-Arab-Malaysian Merchant Bank Berhad [1995] 3 MLJ 331; [1995] 4 CLJ 283 FC at pages 284 and 285, where the Federal Court held that: “[6] Justice of the present case clearly lies in favour of considering the estoppel issue. At the time it received the said invoices of Chemitrade bearing the indorsement specifying the 14-day limit for objection, the appellant had a choice. It could have told the respondent that the 14- day limit was not part of the original arrangement, that it amounted to an abrogation of its rights and that it was not prepared to be bound by the limitation. But it did nothing of the sort. It did not however merely remain silent, for thereafter it actually made payments to those very invoices without any protest. [7] A reasonable man similarly circumstanced as the respondent would have been entitled to assume, as the respondent did, that the appellant was agreeable to the imposition of the 14-day limit. The respondent was clearly influenced by the conduct of the appellant when it paid Chemitrade for those very invoices, and this the respondent would not have done had the appellant protested. The appellant’s attempt to raise this point some seven months later, must be classified as unconscionable and inequitable conduct. It ought not therefore to be permitted to question the validity of the indorsement. [8] The appellant should be estopped from asserting that nothing was due on the impugned invoices. It was the appellant’s silence during the 14-day period that led the respondent to make the payment that was due to Chemitrade. The respondent was therefore entitled to assume that the invoices were good for payment. It would be most unjust for the appellant to now suggest that the respondent ought not to have paid on the disputed invoices. (Emphasis added)” ii. MP Factors Sdn Bhd v Suang Yan Projects Sdn Bhd & Ors [2007] 8 MLJ 602 [HC]: Page 613 “It is an undisputed fact that after being served with the notice to repurchase, the defendants did not at any time raise any protest that the amount demanded is incorrect or that no amount is due and payable to the plaintiff under the agreement. Thus, by the defendants' silence they are estopped from now raising this challenge as the plaintiff was lulled into the belief that the defendants did not intend to challenge the existence of a demand to repurchase the debt, or the correctness of the amount owed by the defendants under the Factoring Agreement.” Page 615 “Each of the invoices also bear a clear statement that any objection to the bills or its items must be notified to them in writing within 14 days of its receipt, failing which the bills would be deemed final and conclusive against the main contractor. Consequently, these invoices are deemed good for payment as there was no objection from the main contractor within the stipulated period. More importantly, the plaintiff had acted to its detriment in releasing the initial payments to the first defendant based on the aforesaid invoices. The defendants ought now to be estopped from stating that they do not owe the plaintiff the sum claimed or any other sums (see Boustead Trading (1985) Sdn Bhd v Arab Malaysian Merchant Bank Sdn Bhd [1995] 3 MLJ 331; Hong Leong Leasing Sdn Bhd v Far East Knitting Sdn Bhd [1996] 2 MLJ 251; Chong Yoong Choy v UOL Factoring Sdn Bhd [1996] 2 CLJ 605 ). It is also of material bearing to note that the defendants failed to condescend upon any particulars as to the basis of their dispute on the sums claimed by the plaintiff. And, neither did they show in any manner, any manifest error on the face of the Certificate of Indebtedness. Hence, they are bound by the contents of the Certificate (see Chen Heng Ping & Ors v Intradagang Merchant Bankers (M) Bhd [1995] 2 MLJ 363).” (Emphasis added) iii. HTC GLOBAL SERVICES MSC SDN BHD v KOMPAKAR EBIZ SDN BHD [2008] 1 LNS 419 [HC]: “On each and every invoice in Exhibit "S-1" of Enclosure 8, there is a clear statement "Any discrepancies in the invoices should be informed to us within 7 days from the invoice date." There was no protest after the invoices were issued and received by the defendant. See MP Factors Sdn Bhd v. Suangyan Projects Sdn Bhd & 3 Ors [2006] 1 LNS 358; [2007] 4 AMR 327 applying the Federal Court case of Boustead Trading (1985) SdnBhd v. Arab-Malaysian Merchant Bank SdnBhd [1995] 4 CLJ 283; [1995] 3 AMR 2871 per Gopal Sri Ram JCA co-opted at page 336: Each of the invoices also bear a clear statement that any objection to the bills or its items must be notified to them in writing within fourteen (14) days of its receipt, failing which the bills would be deemed final and conclusive against the main contractor. Consequently, these invoices are deemed good for payment as there was no objection from the main contractor within the stipulated period. More importantly, the plaintiff had acted to its detriment in releasing the initial payments to the first defendant based on the aforesaid invoices. The defendants ought now to be estopped from stating that they do not owe the plaintiff the sum claimed or any other sums. ……….. The law is clear. Where a party fails to raise any objection on the invoice of which they have been served relating to any contract it is to be estopped from denying that payment is due from them. See Syarikat Pakar Kayu dan Perdagangan Sdn Bhd v. Maa-sk Sdn Bhd [1986] CLJ 694 (Rep); [1986] 1 CLJ 595; MP Factors Sdn Bhd v. Suangyan Projects Sdn Bhd & 3 Ors [2006] 1 LNS 358; [2007] 4 AMR 327. Similarly, with respect to the third contract which is oral in nature, it is the duty of the defendant to object to the invoices that had been issued and received by them and having failed to do so the same principle of estoppel will apply.” (Emphasis added) [33] As for the 1st Defendant’s assertion that the Plaintiff did not disclose any facts regarding the payments that had already been made by the 1st Defendant to the Plaintiff, it appears to me with utmost respect that the significance of the proposition of law enunciated by the Federal Court in National Company for Foreign Trade (supra) as alluded to in [14] of this judgment was lost on the 1st Defendant and its learned Counsel and amounts to the 1st Defendant reversing the burden of proof, and reflected the same mistake occasioned by the Court of Appeal in Ho Lai Ying (trading as KH Trading) & Anor v Cempaka Finance Bhd [2004] 2 MLJ 197; [2004] 1 CLJ 232 when it allowed an appeal against summary judgment entered by Cempaka Finance Bhd when it stated interalia: “Thus, a plaintiff would be entitled to obtain summary judgment without trial if he can prove his case clearly which to us would mean that the plaintiff has to establish the existence of certain facts and must prove that those facts exist before the court can determine the issue as to whether the defendant has a defence or has raised an issue against the claim which ought to be tried. set aside.” [34] The Federal Court in Cempaka Finance Bhd v Ho Lai Ying (trading as KH Trading) & Anor [2006] 2 MLJ 685; [2006] 3 CLJ 544 reversed the Court of Appeal’s decision and upheld the summary judgment entered by the High Court. Steve Shim CJ (Sabah & Sarawak) in delivering judgment of the Federal Court held: “[5] Quite clearly, the Court of Appeal has put the burden on the plaintiff to prove his case in an O 14 application. With respect, that cannot be the correct proposition of law. In an application under O 14, the burden is on the plaintiff to establish the following conditions: that the defendant must have entered appearance; that the statement of claim must have been served on the defendant; that the affidavit in support must comply with r 2 of O 14 in that it must verify the facts on which the claim is based and must state the deponent's belief that there is no defence to the claim (see Supreme Leasing Sdn Bhd v Dior Enterprises & Ors [1990] 2 MLJ 36). Once those conditions are fulfilled, the burden then shifts to the defendant to raise triable issues. The law on this is trite. In National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300 the Federal Court has stated thus: We think it appropriate to remind ourselves once again that in every application under O 14, the first considerations are (a) whether the case comes within the order and (b) whether the plaintiff has satisfied the preliminary requirements for proceeding under O 14. For the purposes of an application under O 14, the preliminary requirements are:

the defendant must have entered an appearance;

(ii) the statement of claim must have been served on the defendant; and

(iii) the affidavit in support of the application must comply with the requirements of r 2 of the O 14. … If the plaintiff fails to satisfy either of these considerations, the summons may be dismissed. If however, these considerations are satisfied, the plaintiff will have established a prima facie case and he becomes entitled to judgment. This burden then shifts to the defendant to satisfy the court why judgment should not be given against him.” [6] The proposition of law enunciated by the Federal Court in National Company has been applied in numerous cases. We accept the correctness of that proposition. In reversing the burden of proof as the Court of Appeal in the instant case has done, it has, in our respectful view, misapplied the relevant principles relating to an application for summary judgment under O 14 of the Rules of the High Court 1980.” (Emphasis added) [35] In my respectful opinion, it would have been very simple for the 1st Defendant to itself adduce evidence on payments it has made, if indeed it made any payment at all. It is ‘as clear as day’ that this issue was made as an afterthought and as an opportunistic posturing. [36] As for the 1st Defendant’s final contention that it had never received any ‘claim notice’ from the Plaintiff, it is my respectful view that this contention is bereft of merits. Firstly, there is no requirement to issue a notice of demand or ‘claim notice’(sic) upon the 1st Defendant as a pre-condition to commencing the claim herein – the writ itself is a demand. Second, Exhibit WT-6 shows the Plaintiff’s letter of demand dated 9.11.2022 shows the postal receipt of the said letter and pursuant to s. 12 of the Interpretation Acts 1948 and 1967, service shall be presumed to be effected properly. Whether the Plaintiff is entitled to charge interest at 1.5% for late payment? [37] The 1st Defendant posited that parties had a relationship since 2017, the Plaintiff at all material times has never charged interest at the rate of 1.5% to the 1st Defendant and never gave any warning regarding the interest charged to the 1st Defendant. I find such an argument is not an arguable issue and utterly untenable against the Plaintiff’s contractual right to charge interest at 1.5% per month. Second, the imposition of 1.5% interest on overdue accounts is in fact common practice in cases involving goods sold and delivered. The futility of this assertion in my view is underscored by the following:

37.1 each of the invoice embodied a statement that interest of 1.5% per month will be charged on overdue payments;

37.2 this right to charge 1.5 % per month on overdue accounts was also set out in clause 4 of the credit facility application form. [38] Not only that. The 1st Defendant has not shown any whisper of protest to the charging of such interest and is estopped from so doing after action is filed. [39] It is abundantly clear to this Court that the Plaintiff is contractually entitled to such a rate of interest for overdue payment, and estoppel also applies against the Defendants from disputing the Plaintiff’s right to do so, see Woon Hoe Kan & Sons Sdn Bhd v Bandar Raya Developments Bhd [1974] 1 MLJ 24 FC; Boustead Trading supra where Chemitrade did not protest on the interest; Perangsang Dagang Sdn Bhd v Tanjung Teras Sdn Bhd and Others [2007] MLJU 716; Caltex Oil Malaysia Ltd v Classic Best Sdn Bhd & Ors [2007] 4 MLJ 772, Daya Anika Sdn Bhd v Kuan Ah Hock [1998] 6 MLJ 537; Tansa Enterprise Sdn Bhd v Temenang Engineering Sdn Bhd [1994] 2 MLJ 353; Enco Systems Sdn Bhd v Soon Hin Hardware Sdn Bhd [2009] 9 MLJ 535. Whether the guarantee is enforceable against the 2nd and 3rd Defendants? [40] As earlier stated, the 2nd and 3rd Defendants’ Statement of Defence and affidavits filed are similar not only in content, but in prolixity except for the 3rd Defendant’s additional contention that he purportedly had no knowledge about the sale and purchase because he was away in Bangladesh. [41] In considering this issue, it is to be borne in mind that it is not disputed that both the 2nd and 3rd Defendants executed the guarantee. They alleged that the guarantee is for project in the year 2017 only, it is “an abuse of power and a violation of public policy” to make them liable as they have resigned when the present debts were incurred and thus have no knowledge; the credit limit for the 2017 project is only RM150,000; and the purchase orders do not bear their names. These allegations they submit, are enough to direct that there should therefore be a trial. [42] I think not. [43] In my respectful view, these allegations are misguided attempts to create triable issues, self-serving, short on substance, tenuous, and should not be given any weight. Having signed the guarantee, they are bound by the terms therein and are jointly and/or severally liable for the payment of all monies owed by the 1st Defendant to the Plaintiff as principal and not merely as sureties. My reasons follow. [44] Firstly, the allegation that they have resigned (even IF it is true, based on their mere ipse dixit and a letter of resignation that do not even bear an acknowledgment by the company secretary, and conspicuous non production of any form lodged and acknowledged received by the Companies Commission Malaysia pursuant to the Companies Act 2016) do not matter one whit. This is so because there is nothing in the guarantee which states that the guarantor would be discharged upon his resignation as director of the 1st Defendant. In addition, Clause 10 of guarantee specifically stated that the guarantee is a continuing guarantee. When construed with the rest of the terms of the guarantee, it means until the sums owed by the 1st Defendant has been fully paid, the 2nd and 3rd Defendant’s liability remain, see Chung Khiaw Bank Ltd v Soi Huan & Ors [1986] 1 MLJ 18. Clause 10 reads: “(10) My/our liabilities and obligations under this Guarantee and Indemnity shall continue to be valid and binding for all purposes whatsoever notwithstanding any change by amalgamation reconstruction or otherwise which may be made in your constitution or in the constitution of the Customer”. [45] It is confounding in what way the guarantee is anthethical to public policy, neither did learned counsel for the 2nd and 3rd Defendants make any submissions on this, other than merely making a hollow pronouncement. Incidentally, the same counsel acts for all Defendants. [46] Second, the guarantee does not state anywhere that it is a guarantee limited to project for 2017. [47] Third, none of the Defendants have disputed that the purchase orders were issued by the 1st Defendant. As such, even if the puchase orders do not bear the 2nd and/or 3rd Defendant’s name or signature, it is immaterial. [48] Fourth, the fact that the "credit limit" was not stated in the Credit Facility Application does not in any way make the terms therein or the guarantee unenforceable. The reference by the 2nd and 3rd Defendants to the whatsapp conversation (Exhibit VR-1) to say that the credit limit is RM150,000 does not hold any water as the whatsapp does not categorically state that the RM150,000.00 referred to by the 3rd Defendant is the "credit limit"; neither can it be read to say it is for project in 2017 as postulated. Even if the "credit limit" was changed, the 2nd and 3rd Defendants are still liable by dint of the express provisions of clause 2 of the guarantee which provides: “(2) This Guarantee and Indemnity shall be without prejudice to and shall not be affected by nor shall I/we be released or exonerated by any of the following matters, whether with or without consent or notice to me/us:

the refusal of any further surplies of goods to the Customer or the determination, increase or variation of any credit or terms of credit to the Customer” [49] As for the 3rd Defendant’s argument that he was away in Bangladesh when the purchase orders were made and as such, he has no knowledge and is not liable, I do not find that this argument can exculplate him from liability at all as the validity of the guarantee is not dependent on him being in Malaysia only. I reject this assertion, thus rendering the issue as not triable. He and the 2nd Defendant are bound by the guarantee so long as there are debts owed by the 1st Defendant to the Plaintiff. [50] Fifth, it is significant to note in clause a) of the guarantee, the 2nd and 3rd Defendants jointly and severally “guarantee as Principal/s and not merely as surety/ies the payment on demand of all monies due” to the Plaintiff by the 1st Defendant as Customer incurred “whether alone or with any other body(ies) or person(s)”. [51] In Credit Corporation (M) Berhad v Choi Sang & Anor [1989] 1 CLJ (Rep) 440, Siti Norma Yaakob J (as she then was) observed: “The law on the effect of the presence of a principal debtor clause in a guarantee is clear in that it obviates the necessity of a creditor to make a demand. This is so as a guarantee is a collateral agreement and before being sued, it is only right and just that a demand be made on the guarantor. However, the character of the guarantee changes where there is also included a principal debtor clause in the body of the guarantee. The guarantee is no longer a collateral agreement and as such there is no need for a demand as the issuance of the writ is a demand in itself. …” [52] This Court in giving Clause a) of the guarantee its ordinary meaning, the effect is that the 2nd and 3rd Defendants have undertaken as principal debtors, a primary obligation to pay the Plaintiff. Their liability as such is not dependent on the liability of the 1st Defendant for they are principal debtors themselves. Their liability is a primary liability, not a secondary liability. [53] The effect of a “principal debtor clause” has been explained by the Federal Court in Andrew Lee Siew Ling v. United Overseas Bank (M) Bhd [2012] 3 CLJ 708; [2012] 3 MLJ 449, at 459 and 460 where it was held as follows: "It is our considered view that in the present case the appellant, being a person who has given a guarantee and more importantly an indemnity, is primarily liable for losses which the principal borrower could not have been made liable. His liability is not dependent or secondary to the liability of the principal borrower. He is a principal debtor himself. The liability under a contract of indemnity does not depend on whether the principal debt is enforceable. It has no reference in law to the obligation of any third person. In essence, the liability of the person who has given an indemnity can be more extensive than that of the liability of the principal borrower (see the cases of (1) Yeoman Credit Ltd v. Latter & Anor [1961] 2 All ER 294 and (2) Chung Khiaw Bank Ltd v. Soi Huan & Ors [1985] 1 LNS 71; [1986] 1 MLJ 188)."(Emphasis added) [54] In my respectful view, the 2nd and 3rd Defendants should not be allowed to hide behind the bare allegations that they have made. On the facts as obtained here, I fail to appreciate why the guarantee is not enforceable. [55] The matter does not come to an end if the Defendants have not been able to raise any triable issue. I think it desirable at this juncture to ask the question, were they able to show there is “some other reason for trial” pursuant to Order 14 rules 3(1) ROC 2012? [56] However, I am not able to find anything relied upon by the Defendants that requires “closer investigation” and constitute there is “some other reason for trial” within the category of what Megarry J had in mind in Miles v Bull [1968] 3 All ER 632, page 637 to 638 as adopted by the Federal Court in United Merchant Finance Bhd v Majlis Agama Islam Negeri Johor [1999] 1 MLJ 657. [57] In the round, I am satisfied that no bona fide triable issue has been raised by the Defendants; nor did they show there is “some other reason for trial” pursuant to Order 14 rules 3(1). It is my considered view that a trial will not throw any further light on the matter as all the issues canvassed in the application before the court are clear, and can be decided once and for all without going to trial. In this regard, I recall the crisp reminder of Vincent Ng J in Suppuletchimi v Palmco Bina Sdn Bhd [1994] 2 MLJ 368 is applicable: “.. No party in a proceeding is entitled to require the court to accord them valuable time of several days open court viva voce trial only upon mere or bare assertions in their affidavits…” [58] The Defendants have no defence to the Plaintiff’s claim. I have no reasonable doubt that the Plaintiff is entitled to summary judgment. [59] For reasons given, I therefore exercised my discretion to enter summary judgment as prayed by the Plaintiff with costs subject to allocator. Dated: 20th July 2023 - sgd - ……………………….. Liza Chan Sow Keng Judge High Court of Malaya at Kuala Lumpur COUNSEL: For the Plaintiff : Ng Lian Kian Messrs Ng, Gan & Partners For the Defendants : Revathi Kannan Messrs Revathi & Partners CASES REFERRED: National Company for Foreign Trade v Kayu Raya Sdn Bhd [1984] 2 MLJ 300; [1984] 2 CLJ 220 Voo Min En & Ors. v Leong Chung Fatt [1982] 2 MLJ 241 Bank Negara Malaysia v Mohd Ismail Ali Johor & Ors [1992] 1 MLJ 400 Jacobs v Booth Distillery Co. [1901] 85 LT 262 Southern Finance Bhd v Sun City Development Sdn Bhd & Anor [2006] 7 CLJ 464 South East Asia Insurance Bhd v Kerajaan Malaysia [1996] MLJU 642; [1998] 1 CLJ 1045 HSBC Bank Malaysia Bhd v Ng Tien Beng & Ors [2008] 9 CLJ 631 Stamford College Bhd v Iris Corp Bhd [2014] 8 MLJ 178 Chen Heng Ping @ Tian Seow Hock & 5 Ors v. Intradagang Merchant Bankers

(M) Berhad [1995] 3 CLJ 690 Caltex Oil Malaysia Ltd v Classic Best Sdn Bhd & Ors [2007] 4 MLJ 772 Boustead Trading Sdn Bhd-v-Arab-Malaysian Merchant Bank Berhad [1995] 3 MLJ 331; [1995] 4 CLJ 283 Ho Lai Ying (trading as KH Trading) & Anor v Cempaka Finance Bhd [2004] 2 MLJ 197; [2004] 1 CLJ 232 Cempaka Finance Bhd v Ho Lai Ying (trading as KH Trading) & Anor [2006] 2 MLJ 685; [2006] 3 CLJ 544 Chung Khiaw Bank Ltd v Soi Huan & Ors [1986] 1 MLJ 18 Credit Corporation (M) Berhad v Choi Sang & Anor [1989] 1 CLJ (Rep) 440 Andrew Lee Siew Ling v. United Overseas Bank (M) Bhd [2012] 3 CLJ 708; [2012] 3 MLJ 449 Miles v Bull [1968] 3 All ER 632 United Merchant Finance Bhd v Majlis Agama Islam Negeri Johor [1999] 1 MLJ 657 LEGISLATION/STATUTE: