The court affirmed that failure to comply with payment terms in a settlement agreement leads to the entire amount becoming due, justifying summary judgment.

[1] This is an appeal by the Defendants against the decision of this Court in allowing encl 10 under O 14 for summary judgment entered for the Plaintiff. An order was granted against the Defendants to pay the Plaintiff a sum of RM862,000.00 for machinery rental with interest of 5% calculated on the original sum RM1,272,541.5 from 25 October 2023 as per the breakdown shown in the affidavit in support encl 12.

[2] The application for summary judgment albeit for a sum of RM 1,272,541.06 (having deducted RM190,000.00 paid by the Defendants to the original claim of RM1,545,541.05) arose from a settlement agreement@ letter of guarantee formulated by both parties to bring to end a suit filed by the Plaintiff in JA-22NCVC-67-05/2023, only against the 1st Defendant, then for. The 2nd Defendant being the director of the 1st, did not dispute the existence of this letter of guarantee and the said outstanding sum.

[3] The 2nd Defendant acting as guarantor in the said settlement agreement (see: enclosure 12 Affidavit in Support "AIS" page 79 pdf.) where the agreement sees both the Defendants had agreed for the payment of RM1,557,541.05 to the Plaintiff by way of monthly instalment paid via online transfer. With this consensus, suit 67 withdrawn. The monthly instalment was also tabled as part of the settlement agreement (see: enclosure 12 AIS p 4 pdf).

[4] The clauses to the agreement selected by this Court to be the crucial ones state as follows:

"2. Failure to make payment of any instalment due herein for more than a period of seven (7) days of the due date, a written notice by Superlift Machinery shall be served to MST where upon expiry of fourteen (14) days of such written notice, all the balance outstanding settlement sum become due and payable".

5. In the event of default payment, Superlift Machinery is entitled to sue for the balance outstanding settlement sum and further damages and interest of 5% per annum calculated from due date to the date of payment.

6. A written statement from the Superlift Machinery as to any amount due to Superlift Machinery under this Settlement Agreement giving details on the basis of calculation or determination of that amount, shall, in the absence of manifest error, be conclusive evidence that such amount is in fact due and payable..

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Guarantee

7. In consideration of Superlift Machinery and MS Time agreeing to enter into this Settlement Agreement and in consideration Superlift Machinery agreeing to withdraw the Suit, DSMEA (2nd Defendant) hereby unconditionally and irrevocably guarantee and undertake to pay on demand all monies and liabilities whether certain or contingent now or hereafter due or owing or remain unpaid by MS Time to Superlift Machinery under this Settlement Agreement as may be demanded by Superlift Machinery.

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15. To give effect to this Guarantee, Superlift Machinery shall be at liberty to act as though the guarantor were principal debtor to Superlift Machinery for all payments guaranteed by the guarantor as aforesaid to Superlift Machinery."

[5] The defendants contended that they had in fact paid more, the payment sum being RM639,403.33. The Plaintiff upon perusing and updating its payment records, responded via its affidavit in response encl 15 admitting the said payment of RM639,403.33 by the Defendants. The omission to recognize this payment arose as the Defendants had failed to notify the incoming payments from the Defendants.

[6] This is understood as the table for the repayment by way of 26 instalments of a particular sum carry a due date of the 25th for each month beginning with the 1st instalment to be for RM95,000.00 with due date 25 September 2023. The breakdown of the a