Back
2024 MarsdenLR 1123
HIGH COURT MALAYA KUALA LUMPUR
MALAYAN BANKING BERHAD – Appellant
Versus
DC & A DEVELOPMENTS SDN BHD & ORS – Respondent
[Suit No: WA-22NCC-815-11/2023]
The Certificate of Indebtedness serves as conclusive evidence of debt, shifting the burden to the Defendants to prove any manifest error, while without prejudice communications remain inadmissible as evidence.
Headnote:(A) Rules of Court 2012 – Order 14 – Summary judgment – Plaintiff's application for summary judgment for RM4,204,223.44 based on Certificate of Indebtedness – Defendants raised triable issues regarding interest calculation and admissibility of evidence – Court found no manifest error in Certificate – Defendants failed to establish triable issues warranting trial – Application allowed. (Paras 1, 17, 58)
(B) Certificate of Indebtedness – Conclusive evidence of debt – Burden on Defendants to prove manifest error – Court upheld Plaintiff's claim based on Certificate. (Paras 40, 42)
(C) Without prejudice communications – Letters inadmissible as evidence of admissions – Privilege protects negotiations aimed at settlement. (Paras 46, 56)
Facts of the case: Plaintiff sought summary judgment for RM4,204,223.44 against Defendants for default under a Term Loan facility. Defendants disputed the claim, raising issues regarding interest calculation and the admissibility of certain letters.
Findings of Court: Court found that the Plaintiff met the requirements for summary judgment and that the Defendants did not raise any triable issues.
Issues: Whether the Defendants raised triable issues regarding the Certificate of Indebtedness and the admissibility of without prejudice letters.
Ratio Decidendi: The court ruled that the Certificate of Indebtedness is conclusive unless a manifest error is shown, and without prejudice letters cannot be used as evidence of admissions.
Result: Plaintiff's application for summary judgment allowed.
JUDGMENT
[1] This judgment concerns the Plaintiff's application for summary judgment against the Defendants for the sum of RM4,204,223.44 with interest, premised on the Defendants' alleged default under a Term Loan facility granted by the Plaintiff. The application is opposed by the Defendants who have raised various triable issues, including whether there is manifest error in the Certificate of Indebtedness relied on by the Plaintiff, whether the default interest ought to be compounded daily or monthly, the admissibility of without prejudice communications, and the sufficiency of particulars in respect of the Plaintiff's calculation of the total sum claimed. The Plaintiff contends that the issues raised are not triable as the Defendants have no valid defence to the claim, relying on the Certificate of Indebtedness as conclusive evidence of the Defendants' liability and indebtedness. The key question for determination is whether the Defendants have raised any triable issues that warrant a full trial of the matter or whether the Plaintiff is entitled to summary judgment on the available evidence.
Background Facts
[2] Pursuant to a letter of offer dated 27 January 2012 ("Letter of Offer") and supplementary letters of offer dated 17 April 2012, 1 August 2012, 28 February 2014, 28 April 2014 and 13 January 2015 issued by the Plaintiff, Malayan Banking Berhad and accepted by the 1st Defendant DC & A Developments Sdn Bhd, and a Facility Agreement dated 14 April 2014 ("the Facility Agreement') entered into between the Plaintiff and the 1st Defendant, the Plaintiff granted to the 1st Defendant a Term Loan facility with a RM10,000,000.00 limit.
[3] The Term Loan facility was secured by a Letter of Guarantee dated 14 April 2014 ('Letter of Guarantee") executed by the 2nd to 4th Defendants, David Chua Kok Tee, Hoo Soot Khing and Chua Hung Tatt. By the Letter of Guarantee, the 2nd, 3rd and 4th Defendants guaranteed payment on demand by the Plaintiff of all sums due and payable by the 1st Defendant to the Plaintiff.
[4] The facility was also secured by a legal charge over land held under Geran 102477 Lot 227 (formerly known as HS(D) 12655 PT 4192) of Pekan Pasir Bogak, District of Manjung, Perak, which was subsequently subdivided into six individual titles.
[5] Pursuant to the above, the Plaintiff duly granted and the 1st Defendant duly utilised the Term Loan facility. However, the 1st Defendant defaulted in making payments on due dates despite the Plaintiff's repeated demands.
[6] The Plaintiff, through its solicitors Messrs Christopher & Lee Ong, issued a letter dated 8 September 2023 to the 1st Defendant demanding full payment of all sums due and owing under the Term Loan facility. The 1st Defendant failed to settle the outstanding sums
[7] The 1st Defendant issued letters dated 18 September 2023 and 25 October 2023 to the Plaintiff's solicitors seeking indulgence and more time to repay the outstanding sums The Plaintiff responded that it was not agreeable to the 1st Defendant's requests for indulgence.
[8] The Plaintiff, through its solicitors, also issued letters dated 2 October 2023 to the 2nd, 3rd and 4th Defendants demanding payment of the sums due from the 1st Defendant. The 2nd, 3rd and 4th Defendants issued a letter dated 10 October 2023 to the Plaintiff's solicitors seeking indulgence and more time to repay the outstanding sums The Plaintiff responded that it was not agreeable to their request for indulgence.
[9] As at 31 August 2023, the Plaintiff's records show that the Defendants were indebted to the Plaintiff in the sum of RM4,204,223.44 with interest thereon at the rate of 1.5% per annum above the Plaintiff's Base Lending Rate ("BLR') with an additional default interest of 1% per annum on all overdue sums, compounded on monthly basis, from 1 September 2023 to date of full payment. The Plaintiff's current BLR is 6.65% per annum.
[10] The Plaintiff commenced legal proceedings against the Defendants via a Wr
