JUDGMENT

Su Geok Yiam JC:

This is an appeal against my decision dismissing the plaintiff's application videa summons in chambers (enc. 13) for a Mareva injunction to restrain the defendant from removing out of the jurisdiction of the court or disposing within the jurisdiction of the court its assets exceeding the sum of RM12,099,825.17.

Facts And Background

The plaintiff and the defendant are both private limited companies incorporated in Malaysia under the Companies Act 1965. The plaintiff is also the registered owner of a vessel known as "Pera Ranger" ("the Vessel"). The registered address of the plaintiff is at Unit 20-03, 20th Floor, Menara Promet, Jalan Sultan Ismail, 50250 Kuala Lumpur. The registered address of the defendant is at No. 21 and 23 (Ground Floor), Jalan Hussein, 30250 lpoh, Perak.

On 14 February 1997, Perak Freight Services Sdn Bhd ("PFS"), a private limited company also incorporated in Malaysia, entered into a Time Charter ("the Time Charter") with two other private limited companies, Perak Meat Industries Sdn Bhd, a local company ("PMI") and Exportlink Pty Ltd of Perth, W.A., a foreign company ("EPL"), both subsidiary companies of the defendant, whereby the former agreed to charter out the vessel to the latter for a term of five years subject to the terms and conditions as stated in the Time Charter.

Subsequently, by a letter dated 23 June 1997, PFS gave notice to PMI and EPL to assign its rights, interests and obligations under the Time Charter to the plaintiff.

One of the clauses of the Time Charter, cl. 5, required PMI and EPL to provide a continuing bank guarantee for a sum of RM1,531,350 equivalent to 90 days hire which shall be maintained by PMI and EPL for the duration of the Time Charter, ie, five years.

However, as it turned out, PMI and EPL were only able to furnish to the plaintiff a three month bank guarantee dated 28 April 1997 which expired on 26 July 1997. By virtue of the failure of PMI and EPL to furnish a fresh bank guarantee to the plaintiff, the plaintiff refused to release the vessel to PMI and EPL. The latter than proposed to the plaintiff to accept a corporate guarantee to be issued by the defendant. The plaintiff alleged that it had no choice but to accept it since a fresh bank guarantee could not be obtained. As a result of this, the defendant which is the holding company of PMI and EPL came to the rescue of PMI and EPL and on 1 August 1997 the defendant gave a corporate guarantee ("the corporate guarantee") to the plaintiff under which it unconditionally guaranteed that in the event PMI and EPL failed to provide the requisite guarantee as stipulated in cl. 5 of the Time Charter the defendant guaranteed the fulfillment of all responsibilities and obligations of PMI and EPL as stipulated in the Time Charter until such time as the requisite bank guarantee was furnished to the plaintiff whereupon the corporate guarantee would expire and be of no further effect.

On the basis of the corporate guarantee the plaintiff duly caused the vessel to be delivered to PMI and EPL on 7 August 1997 for their use under the Time Charter.

Thereafter, no bank guarantee was furnished until almost eighteen months later, on 21 August 1999, when the then solicitors of PMI and EPL delivered to the plaintiff's then solicitors, a Maybank guarantee dated 20 August 1999 ("the Maybank guarantee") for the sum of RM1,531,350 in an alleged attempt to discharge the obligations and responsibilities of the defendant under the corporate guarantee.

By which time the plaintiff had already withdrawn the Vessel thereby terminating the Time Charter. The plaintiff has alleged that since the liability of the defendant under the corporate guarantee had crystallised before the Maybank guarantee was furnished to the plaintiff, the Maybank guarantee is inoperative as far as this writ action is concerned.

The Vessel had in fact been withdrawn on 17 January 1998 when the plaintiff gave notice by letter to PMI and EPL for such withd