(delivering the judgment of the court): The appellants ('the bank') are a company incorporated in the United States of America with a place of business in the Republic of Singapore and is resident outside the Scheduled Territories as defined by the Exchange Control Act 1953. At all material times, Votier Investment Pte Ltd ('Votier'), a company registered in Singapore, was a customer of the bank and had an account with them.

The respondents are directors and shareholders of Votier. Votier had asked the bank for a loan. In its offer letter dated 9 January 1985 the bank wrote as follows:

American Express International Banking Corporation Shing Kwan House, 4 Shenton Way, Singapore 0106.

9 January 1985

Votier Investment Pte Ltd

36 Robinson Road

#18-01 City House

Singapore 0106

Attention: Mr YH Chong

Dear Sirs

Credit Facilities

We are pleased to advise that American Express International Banking Corporation has approved a demand loan with maximum validity of one year to you to be available as follows: AmountUS$6m Interest2¼% over three or six months SIBOR payable quarterly.

Collateral:

(1) Pledge of Sri Hartamas Corporation Berhad shares (plus bonus shares and/or right issues, if any) giving a minimum excess margin of 66% or total outstandings not to exceed 60% of market value of shares pledged. Shares to be registered in the name of American Express International Banking Corp.

(2) Personal guarantees of the following directors for US$6m: (a)Mr Chong You HiongUS$2,460,000 (b)Dato Wong Kee TatUS$2,460,000 (c)Datuk Syed Kechik bin Syed MohamedUS$1,080,000

In this regard, kindly execute and return to us the duplicate copy of this letter as a token of your acceptance and the following documents within 21 days from the date hereof:

(1) Company resolution accepting the above facility granted as per the terms and conditions of our offer letter

(2) General loan and collateral agreement

(3) Memorandum and deposit of shares

(4) Guarantees

(5) Promissory note

In accordance with normal banking practice, we however, reserve the right to review, revise or cancel the above line of credit at our sole discretion. It is our wish that you will use the facility to your continuing advantage and that should your circumstances change to an extent which would require a modification of our line of credit, you will provide us with sufficient notice and additional financial information to enable us to consider the modification you require.

We trust that the above arrangement is satisfactory and assure you of our best services at all times.

Very truly yours Sgd Tan Kim Lan (Miss)Sgd Anthony Lee Assistant TreasurerVice President & Deputy General Manager

Votier accepted the offer by circular resolution of the company on 10 January 1985 in the following terms:

Credit Facility

(1) That the company do accept a credit facility of United States Dollars Six Million (US$6,000,000) Only from American Express International Banking Corporation of Shing Kwan House 4 Shenton Way Singapore 0106 and substantially upon such terms and conditions stipulated in the letter from the said financial institution dated 9 January 1985, a photocopy of which is attached herewith.

(2) That as security for the said credit facility, Sri Hartamas Development Sdn Bhd do execute a memorandum of deposit of stocks/shares pledging shares in Sri Hartamas Corporation Berhad having the minimum security coverage as is provided in the aforesaid letter dated 9 January 1985.

(3) That as additional security, the following directors of the company, namely:

(i) Datuk Syed Kechik bin Syed MohamedUS$1,080,000

(ii) Dato Wong Kee TatUS$2,460,000

(iii) Chong You HiongUS$2,460,000

shall give a personal guarantee for the said facility for the sum set against their respective names above.

(4) That Mr Chong You Hiong be and is hereby authorized to sign the general loan and collateral agreement, the promissory note and other documents incidental thereto, relating to the