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2011 MarsdenLR 260
HASNAH MOHAMMED HASHIM
PUBLIC BANK BERHAD – Appellant
Versus
LEE PENG HAI & ORS – Respondent
In summary judgment applications, the burden shifts to defendants to show triable issues once plaintiffs meet preliminary requirements, and a Certificate of Indebtedness shifts proof responsibility.
Headnote:(A) Rules of the High Court 1980 - Order 14 - Summary judgment - Plaintiff applied for summary judgment for RM1,034,728.40. Court emphasized on the requirement of satisfying preliminary conditions under Order 14 which include entry of appearance by the defendant, service of statement of claim, and affidavit compliance. Plaintiff fulfilled these requirements establishing a prima facie case. Defendants contended a variation of the Facility Agreement and failed to demonstrate any triable issues. Court upheld that a Certificate of Indebtedness dispenses with additional proof of debt. (Paras 2-5, 8-11)
Facts of the case:
The case involves a summary judgment application for the recovery of a debt amounting to RM1,034,728.40 against several defendants regarding the alleged default on a loan secured by shares. The defendants claimed a variation in the loan agreement concerning pledged shares but failed to present a viable defense.
Findings of Court:
The court found no triable issues presented by the defendants, granting summary judgment for the plaintiff along with costs.
Issues: The primary issue was whether the defendants established any triable issues against the plaintiff's claim and the legal sufficiency of the Certificate of Indebtedness as proof of debt.
Ratio Decidendi: The court determined that the plaintiff satisfied all applicable requirements under Order 14, shifting the burden to the defendants, who failed to demonstrate any inconsistencies or errors in the plaintiff's claims, affirming the legal principle that where issues are clear, trial may be avoided.
Result: Enclosure 3 for summary judgment is allowed with costs.
| Table of Content |
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| 1. plaintiff's application for summary judgment details (Para 1 , 2 , 3) |
Enclosure 3 is the Plaintiffs application for summary judgment pursuant to Order 14 r. 1 of the Rules of the High Court 1980 against the Defendants for the following orders:-
i. the sum of RM1,0347,288.40 being the amount due and owing to the Plaintiff as at 9.12.2008;
ii. interest on the sum of RM1,0347,288.40 at the interest rate of 10.95% per annum (inclusive of BLR at the rate of 6.55 and a spread rate of 3.4% a together with a default interest of 1%) from 10.12.2008 until the date of full and final settlement; and
iii. cost of the Application.
The Application is supported by an Affidavit in Support affirmed on 16.12.2009.
In National Company for Foreign Trade v. Kayu Raya Sdn. Bhd. (1984) 1 CLJ 283 (Rep) ; (1984) 2 CLJ 220 ; (1984) 2 MLJ 300 , the Federal Court has stated as follows:
"... We think it appropriate to remind ourselves once again that in every application under O. 14, the first considerations are (a) whether the case comes within the order and (b) whether the plaintiff has satisfied the preliminary requirements for proceeding under O. 14. For the purposes of an application under O. 14, the preliminary requirements:-
(i) the defendant must have entered an appearance;
(ii) the statement of claim must have been served on the Defendant;
(iii) the affidavit in support of the application must comply with the requirements of r. 2 of the O. 14.
.... If the Plaintiff falls to satisfy either of these considerations, the summons may be dismissed. If however, these considerations are satisfied, the plaintiff will have established a prima facie case and he becomes entitled to judgment. This burden then shifts to the defendant to satisfy the court why judgment should not be given against him ...".
In Bank Negara Malaysia v. Mohd Ismail (1992) 1 CLJ 14 (Rep) ; (1992) 1 CLJ 627 the Supreme Court held that the duty of a Judge does not end as soon as the fact is asserted by one party, or denied or disputed by the other on affidavit. The Judge has a duty to reject such assertion or denial if such assertion or denial is equivocal or lacking in precision or is inconsistent with undisputed contemporary documents or is inherently improbable.
"..... Under an O. 14 application, the duty of a Judge does not end as soon as a fact is asserted by one party, and denied or disputed by the other on affidavit. Where such assertion, denial or dispute is equivocal or lacking in precision or is inconsistent with undisputed contemporary documents or other statements by the same deponent or is inherently improbable in itself, then the Judge has a duty to reject such assertion or denial, thereby rendering the issue as not triable. In our opinion, unless this principle is adhered to, a Judge is in no position to exercise his discretion judicially under an O. 14 application. Thus, apart from identifying the issues of fact or law, the Court must go one step further and determine whether they are triable. This principle is sometimes expressed by the statement that a complete defence need not be shown. The defence set up need only show that there is a triable issue.".
The Plaintiff have satisfied the preliminary requirements as laid down in the Kayu Rayas case that are:
1) the Defendants have entered appearance;
2) the Statement of Claim have been served on been served on the Defendants; and
3) the Affidavit in Support is in compliance with O. 14 r. 2 Rules of the High Court (RHC).
The burden is now shifted to the Defendants to satisfy the Court and why Judgment should not be entered against them.
The issues
i. It is the contention of the Defendants that by a letter dated 10.11.2001 that the Plaintiff varied the Facility Agreement as they had requested the Borrower to deposit 1.2m Orienthold Sdn. Bhd. shares as additional security for the overdraft. The additional security was one of the terms and condition of the approval of the Plaintiff to c
