A lender is under a legal obligation to reassign property securing a loan upon full repayment, reflecting principles of contract law and equity of redemption.

Chronology Of The Events

6 December 1996

[1] Upon the respondent's application, the appellant granted a term loan and overdraft facilities to the respondent. The facilities were secured by way of an assignment of the property known as Suite No 1202, Tower B, Wisma Pantai located in Kuala Lumpur (hereinafter referred to as the "Wisma Pantai") from the respondent in favour of the appellant.

6 November 2002

[2] The respondent and appellant jointly filed an application in Kuala Lumpur High Court Originating Summons No S6-24-4147-2001 ('2001 suit') against Atlas Corporation Sdn Bhd ('Atlas'). The principal relief sought in the 2001 suit was for a declaration that the sale and purchase agreement between the respondent and Atlas for the purchase of the Wisma Pantai be deemed rescinded (due to Atlas's misrepresentation). Incidentally Atlas was the developer of the Wisma Pantai.

15 November 2002

[3] The Court allowed the 2001 suit and ordered amongst others, the following:

i) A declaration that the sale and purchase agreement dated 15 March 1996 (between the respondent and Atlas) was lawfully rescinded vide the respondent's letter dated 13 February 2001;

ii) Atlas was to return the sum of RM816,696.00 to the respondent and appellant, together with interest thereon until full settlement;

iii) The sum awarded in para (ii) above is to be used to redeem the charge (over the Wisma Pantai) in favour of the appellant

20 February 2004

[4] Atlas was ordered to be wound up.

1 December 2008

[5] Atlas's liquidators placed advertisements inviting tenders for the purchase of the Wisma Pantai.

12 December 2008

[6] The respondent filed an application in the winding up action (where Atlas was ordered to be wound up) in Kuala Lumpur High Court Companies (Winding-Up) No D7-28-946-2003 ('2003 application') to set aside and or prohibit Atlas' liquidators from disposing off the Wisma Pantai.

13 May 2009

[7] The respondent's 2003 application was dismissed.

8 March 2011

[8] The appellant issued a letter to the respondent requesting it to forward the deed of receipt and reassignment/satisfaction of charge documents for the execution of appellant's attorney in connection with the Wisma Pantai.

22 April 2011

[9] The respondent accepted the agreement of the appellant to reassign Wisma Pantai and made known the identity of its solicitors to effect the reassignment on its behalf.

1 July 2011

[10] The appellant issued a letter to the solicitors for the respondent clarifying that the Wisma Pantai cannot be reassigned to the respondent as the respondent had obtained an order to rescind the sale and purchase agreement in respect of the Wisma Pantai in the 2001 suit.

28 October 2011

[11] The respondent issued an originating summons against the appellant seeking inter alia the following relief:

1) A declaration that the respondent has fully settled all the outstanding sums due to the appellant under the term loan facility (Account No 7-14026-000324041) ('term loan') and the overdraft facility (Account No 2142-1300029480) ('overdraft') (collectively hereinafter referred to as 'the facilities') which are secured inter alia by a deed of assignment dated 6 December 1996 entered into between the respondent and the appellant;

2) A declaration that the appellant has breached its own undertaking in failing, neglecting, refusing and/or unable to execute a deed of receipt and reassignment in favour of the respondent for a property known as Suite No 1202, Tower No B, Wisma Pantai and held under master title Geran 5990, Lot 4096 & 4099, Geran 15352, Lot 2508 & 2509 and HS (D) 60799, Lot 2510 & 2511, Mukim Kuala Lumpur, Wilayah Persekutuan ('the property') upon the full repayment of the facilities by the respondent to the appel