The court ruled that summary judgment is appropriate when no bona fide triable issues exist, emphasizing the necessity of formal documentation for contractual obligations.

JUDGMENT

Atan Mustaffa Yussof Ahmad J:

Introduction

[1] This judgment concerns an application for summary judgment filed by Kenanga Investors Berhad, against Zulrafq Capital Sdn Bhd and Tan Sri Zulhasnan bin Rafique, in relation to a Put and Call Option Agreement and a Supplemental Option Agreement. The dispute revolves around the Defendants' failure to fulfill their obligations under these agreements, specifically the payment of a premium and rollover fees in consideration for an extension of the option periods. The Plaintiff contends that there are no triable issues and that summary judgment should be entered in its favour. The Defendants resist the application, arguing that there are various factual and legal issues that warrant a full trial, including the existence of an alleged oral agreement and understanding between the parties that a third party, Muhammad Taqiuddin Halim, would be ultimately responsible for making the payments due to Kenanga under the Option Agreements, as well as allegations of a conspiracy between Kenanga's CEO, Datuk Wira Ismitz Matthew De Alwis and Muhammad Taqiuddin to injure the Defendants and that the Option Agreements are sham agreements.

Background Facts

[2] On 22 October 2021, the Plaintiff, Kenanga Investors Berhad, and the First Defendant, Zulrafq Capital Sdn Bhd, entered into a Put and Call Option Agreement together with a Term Sheet attached thereto (collectively referred to as "the Option Agreement'). Under the Option Agreement, Kenanga granted the First Defendant a Call Option to buy back from the Plaintiff RM40,000,000 worth of ordinary shares in KNM Group Berhad amounting to 190,476,190 shares ("Option Shares"). The Plaintiff also had an irrevocable Put Option to sell to the First Defendant or its nominee the Option Shares on the Maturity Date defined in the agreement.

[3] The Call Option was exercisable by the First Defendant within 6 months from the Transaction Date of 5 November 2021 ("Call Option 1") or 3 months from the expiry of Call Option 1 ("Call Option 2"). The Call Option Period of 9 months from the Transaction Date fell on 4 August 2022 ("Maturity Date"). The First Defendant had to serve written notice on the Plaintiff at least 3 business days prior to the Maturity Date to exercise the Call Option.

[4] The Plaintiff could exercise the Put Option by serving written notice on the First Defendant at least 10 business days prior to the Maturity Date. The Put Option Period was also 9 months from the Transaction Date. If the Put Option was not exercised during this period, it would lapse and terminate automatically.

[5] On 22 October 2021, the Second Defendant, Tan Sri Zulhasnan bin Rafique, as part of the Option Agreement, provided a Personal Guarantee ("the Personal Guarantee") to guarantee the performance of the First Defendant's Zulrafq's obligations.

[6] On 27 July 2022, the First Defendant applied to the Plaintiff for a 9-month extension and rollover of the Call Option Period and Put Option Period from the Maturity Date of 4 August 2022. In consideration, the First Defendant agreed to pay the Plaintiff:

a) RM4,800,000 as premium on or before 15 September 2022 ("Premium Payment');

b) RM400,000 as rollover fee on or before 30 August 2022 ("Rollover Fees"); and

c) All relevant fees and expenses incurred in the extension on or before 15 September 2022.

[7] On 3 August 2022, the Plaintiff and the First Defendant executed a Supplemental Option Agreement varying the terms of the Option Agreement ("Supplemental Option Agreement'). The Call Option 3 was exercisable within 6 months from the expiry of Call Option 2, while Call Option 4 was exercisable 3 months from the expiry of Call Option 3. The Put Option Period was varied to 18 months from this Transaction Date.

[8] On 7 November 2022, the Second Defendant wrote a letter to the Plaintiff that stating that he gave an undertaking to pay the RM4.8 million premium but requested further time to settle the sum.

[9] The First Defendant failed to pay t