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2013 MarsdenLR 1449
HIGH COURT MALAYA KUALA LUMPUR
CIMB BANK BERHAD – Appellant
Versus
NORLIA MOHD YUSOF (ENCL 6) – Respondent
[Suit No: 22NCC-1414-09/2012]
The liability of a guarantor is primary and continues despite the winding up of the principal borrower, and a summary judgment can be granted if no triable issues exist.
Headnote:(A) Relevant Law - Order 14 Rules of the Court 2012; Principles laid down in National Company for Foreign Trade v. Kayu Raya Sdn Bhd [1984] 1 MLRA 190; [1984] 2 MLJ 300.
(B) Summary judgment principles - A party must satisfy preliminary requirements for proceeding under O 14; the court is to determine if there is a triable issue (Para 5).
(C) Burden of proof - Upon satisfaction of these requirements, the burden shifts to the defendant to show why judgment should not be given (Paras 7, 8).
Facts of the case:
The Plaintiff sought RM1,776,382.82 as due from the Defendant, who guaranteed a loan for a company that has since been wound up. The Defendant contended that the plaintiff's action was time-barred and raised issues regarding the guarantee's validity post-winding up (Paras 1-24).
Findings of Court:
The Plaintiff satisfied all preliminary requirements and presented a certificate of indebtedness, which was conclusive evidence of the debt owed. The Defendant's liabilities remain valid despite the company’s winding up (Paras 25-29).
Issues: The court addressed whether the Defendant's claims about time limitations and guarantees were valid (Para 30).
Ratio Decidendi: The court concluded that the Defendant had no triable issues, emphasizing the irrevocable and unconditional nature of the guarantee, which stands even after the Borrower’s winding up.
Result: Application for summary judgment allowed with costs.
| Table of Content |
|---|
| 1. plaintiff's application for summary judgment. (Para 1 , 1 , 2 , 3 , 4) |
| 2. court's guidelines for summary judgment. (Para 5) |
[1] Enclosure 6 is the Plaintiff's application for summary judgment pursuant to O 14 Rules of the 2012 against the Defendant. The Plaintiff's claims are as follows:-
i) the sum of RM1,776,382.82 due and owing as at 20 July 2012;
ii) interest at the rate of 2% per annum based on the BLR from 21 July 2012 and until the date of full realization; and
iii) cost.
[2] The Application is supported by an Affidavit in Support affirmed by Alice Chong Sien Kuan on 7 November 2012 and a further Affidavit in Reply affirmed on 6 December 2012. The Defendant's Affidavits in Reply affirmed by Norlia Yusuf on 23 November 2012.
Background
[3] The Plaintiff granted to Ausmal Meat (M) Sdn Bhd (hereinafter referred to as "the Borrower") vide Letter of Offer dated 21 December 1998 (Exhibit 'C') a banking facility comprising Letter of Credit (LC)/ Trust Receipt (TR) Facility of RM2,000,000.00. The Plaintiff then entered into a Facility Agreement with the Plaintiff dated 29 January 1999. Subsequently the Borrower was wound up on 25 January 2005 vide Kuala Lumpur High Court Companies Winding Up No D5-28-853-2004.
[4] The Defendant together with one Raja Makhtar bin Raja Sulaiman are the Guarantors and Indemnifiers of the aforesaid facility vide Letter of Guarantee and Indemnity dated 29 January 1999 (Exhibit E).
The Law
[5] For an application for Summary Judgment this Court is guided by the principles laid down in National Company for Foreign Trade v. Kayu Raya Sdn Bhd , , where it was stated by the Federal Court as follows:-
