A chargee seeking an Order for Sale under the National Land Code must prove entitlement without showing negligence, where the burden to demonstrate cause to the contrary lies with the chargor.

Introduction

[1] This is the Plaintiff's Originating Summons seeking an Order for Sale and other consequential reliefs under O 83 of the Rules of Court 2012 and ss 256 and 257 of the National Land Code . The Defendant had charged his land to the Plaintiff as security for a Housing Loan and an Overdraft Loan Facility. While the Housing Loan has been settled, the present proceedings arise from the outstanding sum under the Overdraft Loan Account.

[2] The uniqueness of this case lies in the Defendant's defence. He opposed the Plaintiff's claim, contending that the nineteen withdrawal transactions or fund transfers from the Overdraft Loan Account on 20 December 2019 were unauthorized and conducted without his knowledge or consent. The Defendant further denied having any online banking facility linked to the account and disclaimed any association with the two recipients of the funds. The Plaintiff, however, maintained that the transactions were not compromised due to its negligence and asserted that they were a deliberate act by the Defendant.

The Prevailing Issue

[3] The central issue for determination is whether the Defendant is liable for the outstanding sum under the Overdraft Loan Account. This requires the Court to assess the Defendant's claim that the transactions were unauthorized and the Plaintiff's contention that they were the Defendant's deliberate act, not attributable to any negligence on its part.

The Arguments In Support Of The Plaintiff's Case

[4] The Plaintiff averred that detailed investigation that it had carried out revealed that the nineteen fund transfers for the total sum of RM126,620.00 were made from the Defendant's Overdraft Loan Account by the account holder to two unknown third party accounts on 20 December 2019 and that the transactions were made based on authorized user ID, password and One Time Password ("OTP") which will only be given to the registered mobile number of the account holder via banking online facility.

[5] The Plaintiff further asserted that its investigation also revealed that "the Defendant had deliberately disclosed his banking details, including the card number of the Overdraft account together with his security pin numbers to an unknown call received by him on 20 December 2019 of which has compromised the security of his banking account and authorized as well as allowed the nineteen (19) fund transfer to occur".

[6] As the registered chargee, the Plaintiff argued that it has complied with and fulfilled the requirements under the relevant sections and provisions of the National Land Code and O 83 of Rules of Court 2012 respectively, thereby entitling it to exercise its rights under the Charge to exercise its power to apply for an Order for Sale.

[7] The Plaintiff underscored the point that this "Charge action" is an action in rem and not an action in personam to settle a debt.

[8] The authorities cited by the Plaintiff to support the above contentions include Kandiah Peter v. Public Bank Bhd 1993 MarsdenLR 599 ; [1994] 1 MLJ 119 ; ; [1993] 2 AMR 3464; (where it was held, inter alia, that a charge in seeking an Order for Sale does not sue for a debt) and Low Lee Lian v. Ban Hin Lee Bank Bhd 1996 MarsdenLR 285 ; 1997 MarsdenLR 1554 ; ; ("Low Lee Lian")(on what may amount to a cause to the contrary).

[9] In relation to the allegation that it was negligent and/or complicit in course of the events that had taken place, the Plaintiff submitted that it has acted in good faith in processi