Lee Swee Seng JC:

PROLOGUE

[1]On the surface, this is a seemingly simple and straight-forward suit brought by the plaintiff bank to recover the amounts due to it from the borrower and its guarantors of same credit facilities granted to it which facilities were subsequently restructured. However, the defendants contended that there is more to it than meets the eye. The facilities, it was said, were all in respect of a building that the plaintiff wanted to lease for long-term which was to be constructed and furnished by the first defendant with the facilities extended to it by the plaintiff bank. The building is called Wisma Char Yong (‘Wisma CY’). There was also another adjacent piece of land which acquisition was financed by the plaintiff for a building to be constructed thereon with the plaintiff being given a first right of refusal to lease the building when completed.

[2]The defendants contended that it was a right-pocket to left-pocket deal for the plaintiff where the rental it has to pay is deducted at source from the monthly instalments of the first defendant. There was hardly any risk to the defendants and every likelihood of capital appreciation of the properties in years to come. It was a win-win venture for both parties.

[3]The plaintiff had not stayed as a tenant for what the defendants said is the entire 40 years lease and hence for breach of that oral representation and other representations, the plaintiff is not only not entitled to recover the various facilities, but that the first defendant and its associated companies have a claim against the plaintiff bank very much far in excess of the plaintiff’s claims.

[4]Apparently the plaintiff’s move from Wisma CY around 2001 to Menara Lion (which later was renamed Menara Citibank) was because of a default by a borrower and as part of a settlement with the plaintiff, there was the purchase of the shares of a company belonging to the borrower which later resulted in the plaintiff controlling the company that owns Menara Citibank.

[5]The trial took 23 days and there was also a further one day of taking deposition from a witness for the plaintiff, Mr Wong Siew Chong (‘WSC’) in Singapore. That was made pursuant to a Malaysian order for examination of a witness outside the jurisdiction dated 4 October 2011 and an order of the Singapore High Court dated 14 November 2011 for the taking of the deposition. The plaintiff called witnesses and the defendants called six witnesses.

[6]If this judgment has been unduly long it was because of the protracted trial stretching over 23 days and the 16 persons called as witnesses.

PARTIES

[7]The plaintiff had granted a few credit facilities to the first defendant (‘D1’) Pembangunan Cahaya Tulin (‘PCT’) which facilities were guaranteed by a corporate guarantee from the second defendant (‘D2’), Juru Bena Tenaga Sdn Bhd (‘JBT’) and a personal guarantee and indemnity from the third and fourth defendants (‘D3 and D4’), Jim Yew Jin and Jim Yeow Cheng respectively. As D4 had been adjudicated a bankrupt already by the time of trial, the plaintiff’s claim in essentially against D1, D2 and D3 (collectively called the ‘defendants’) for sums outstanding under the various facilities which consisted of four Term loan facilities and three overdraft facilities.

PROBLEM

[8]The key defence of the defendants was that there was a collateral oral agreement alongside the various facilities for it cannot be denied, and indeed was not denied, that the various facilities extended by the plaintiff was for the acquisition of a piece of land to construct a 12 storey building for the plaintiff to rent and the other facilities were all related to the construction of additional floors for the plaintiff’s use, renovation costs and capital expenditure incurred, the acquisition of a further pice of adjacent land for the construction of another building (which the defendants said was for the plaintiff’s use) and for assessment charges relating to the building.

[9]The defendants contende