A receiver acts as an agent of the chargor and is not liable as an agent of the debenture holder without explicit authority; claims citing conspiracy and abuse of process can be struck out.

Introduction

[1] This is a written judgment delivered in an application by the defendants to strike out the claim of the plaintiff.

[2] In order to contextualise the nature of the claim, it will be necessary to recite the brief facts of this case. The background facts, in so far as they are material to this application are set out below, which I have adapted from the submissions of counsel to whom I am grateful.

Background

[3] The plaintiff claims that there exists a concluded contract for the purchase of land and properties in Lembah Beringin entered into between the plaintiff on one hand as purchaser, and the 1st , 2nd and 3rd defendants on the other. The 1st and 2nd defendants are receivers and managers of the 3rd defendant, Lembah Beringin Sdn Bhd (referred to in this judgment as the company), who were appointed by the 12th defendant, RHB Bank Berhad (RHB) as a debenture holder under and pursuant to the terms of debentures created by the company in favour of RHB. These debentures, which secured banking facilities granted by RHB to the company, created fixed and floating charges over the present and future undertakings and assets of the company, which included the subject properties in Lembah Beringin. The company defaulted under the terms of the banking facilities and the receivers and managers were appointed on 11 November 2005 to realise the assets charged under the debentures towards settlement of the sums due and owing by the company to RHB.

[4] The receivers and managers published an advertisement in a newspaper on 5 May 2011 to seek expressions of interest from the public to purchase the subject properties. An information memorandum dated on this day was also issued by the receivers and managers to interested bidders.

[5] Several expressions of interest for the properties were received at the close of the period specified for submission of expressions of interest. These include an expression of interest from the plaintiff for RM60.8 million, and an expression of interest from the 4th to the 11th defendants for RM50 million. For ease of reference, the 4th to the 11th defendants are referred to here as Farcoll and Others.

[6] After considering the expressions of interest, the receivers and managers held a closed tender and invited the persons who had submitted expressions of interest to improve their expressions of interest. In response to the invitation from the receivers and managers, the plaintiff increased its expression of interest to RM83.8 million and Farcoll and Others increased their expression of interest to RM84.0 million. It should be noted that I use the term "expression of interest" advisedly, as this term is frequently used in contradistinction to the term "offer", which in law is capable of acceptance to form a binding contract. I express no opinion on the proper legal characterisation of these expressions of interest in the present case, as the application before me is simply an interlocutory matter and it is thus unnecessary for me to make a ruling on their true legal nature.

[7] On 12 September 2011, the receivers and managers also received an expression of interest of RM84.0 million from Pillar Quest Sdn Bhd (Pillar Quest). Both Pillar Quest and the company were wholly owned subsidiaries of Land & General Berhad.

[8] The receivers and managers then sought to include additional terms and conditions on the sale of the properties, which were communicated to the three groups of interested bidders. I pause here to observe that the imposition of additional terms in these circumstances is not unusual in a negotiated auction sale, as it provides the seller with a means to make a like for like comparison b