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Searching Case Laws & Precedent on Legal Query.....!
Analysing the retrieved Case Laws
Scanned Judgements…!
In cases involving currency seizure or foreign exchange regulations, the legality of foreign currency claims depends on compliance with foreign exchange laws, but this does not preclude making claims in foreign currency in civil courts ["SALT EXPERIENCES AND MANAGEMENT PVT LTD vs COMMISSIONER OF CUSTOMS-NEW DELHI - Customs Excise & Service Tax Appellate Tribunal"], ["JATIN C JHAVERI vs UNION OF INDIA - Supreme Court"].
Analysis and Conclusion:
References:- ["MULIAR OLEG & ANOR vs THE OWNERS AND/OR PERSONS IN POSSESSION OR CONTROL OF THE SHIP ORIENTAL DRAGO.... - 2023 MarsdenLR 1372"]- ["Avitel Post Studioz Limited vs HSBC PI Holdings Mauritius Limited - Bombay"]- ["BAHARAT INTERNATIONAL FZC vs LAI KIM LIAN - High Court"]- ["- High Court"]- ["JATIN C JHAVERI vs UNION OF INDIA - Supreme Court"]- ["JATIN C JHAVERI vs UNION OF INDIA - Supreme Court"]- ["SALT EXPERIENCES AND MANAGEMENT PVT LTD vs COMMISSIONER OF CUSTOMS-NEW DELHI - Customs Excise & Service Tax Appellate Tribunal"]- ["JATIN C JHAVERI vs UNION OF INDIA - Supreme Court"]
In today's globalized economy, businesses and individuals often engage in cross-border transactions denominated in foreign currencies like USD or EUR. But what happens when a dispute arises? Can a claim to civil court be made in foreign currency? This is a common question for parties involved in international contracts, trade deals, or debts owed in non-local currencies.
If you're in Malaysia, the answer is generally yes—but with specific procedural requirements to ensure transparency and enforceability. This blog post breaks down the legal framework, key case law, and practical steps, drawing from established Malaysian jurisprudence. Note: This is general information, not legal advice. Consult a qualified lawyer for your specific situation.
Malaysian courts have the authority to hear and order payments in foreign currency, particularly when the underlying obligation stems from a foreign currency debt or contract. This principle is rooted in judicial evolution and affirmed in local case law.
A landmark influence is the English case Miliangos v. George Frank (Textiles) Ltd1975, adopted in Malaysia: The courts have evolved a procedure under which orders can be made for payment of foreign currency debts in the foreign currency.MEGAH SAKTI SDN.BHD. vs OVERSEA-CHINESE BANKING CORPORATION LIMITED - 2005 MarsdenLR 2871
In The Owners of Cargo carried in the Ship 'Gang Cheng' v. Owners and/or Persons Interested in the Ship 'Gang Cheng' (No 2)1998, the court awarded damages in USD, confirming Malaysian courts' power to pronounce judgments in foreign currency, especially in trade disputes. MULIAR OLEG & ANOR vs THE OWNERS AND/OR PERSONS IN POSSESSION OR CONTROL OF THE SHIP ORIENTAL DRAGO.... - 2023 MarsdenLR 1372
This aligns with broader practices where courts prioritize the currency of the obligation to avoid exchange rate losses.
To make a valid claim, your pleadings must be precise. According to the White Book 2023 and Malaysian precedents, the claim form must specify:
Failure to include these can render the claim defective. For example, transparency prevents disputes over valuation and aids enforcement.
The Exchange Control Act 1953 and related regulations do not prohibit such claims; they regulate transactions but permit court proceedings in foreign currency if compliant. SOCIETE GENERALE CAWANGAN SINGAPURA vs LEE THYE - 2009 MarsdenLR 3035
Recent decisions reinforce courts' flexibility with international elements. In a Sessions Court appeal (civil suit no: MA-B52-NCC-32-08/2023), the High Court overturned a stay in favor of a foreign forum, emphasizing local adjudication where parties, evidence, and witnesses are Malaysian-based. It upheld exclusive jurisdiction clauses only absent compelling exceptional circumstances.MAC PETROLEUM SDN BHD vs EVERMORE ACCESS SDN BHDMAC PETROLEUM SDN BHD vs EVERMORE ACCESS SDN BHD
Malaysian Courts must enforce exclusive jurisdiction clauses unless compelling exceptional circumstances justify non-compliance, with considerations given to the connections of parties and availability.MAC PETROLEUM SDN BHD vs EVERMORE ACCESS SDN BHD
While focused on forum selection, these cases highlight courts' competence in handling cross-border disputes, including currency issues, when local ties are strong.
Indian courts offer parallels. In Forasol v. Oil and Natural Gas Commission (referenced in multiple rulings), plaintiffs must elect at filing: claim in local (INR) or foreign currency, with formalities like exchange rates. Amendments to switch currencies post-filing are often rejected if they introduce vagueness or increase liability. Punjab National Bank VS Indian Bank - 2003 3 Supreme 607INDIAN BANK VS PUNJAB NATIONAL BANK
The plaintiff has to make choice at the time of filing of the suit itself. Plaintiff can either claim in Indian currency or in foreign currency and the formalities required for making the claim in foreign currency are to be clearly spelt out.INDIAN BANK VS PUNJAB NATIONAL BANK
Similarly, in arbitration enforcement, courts apply the exchange rate on the date the award finalizes, without distinguishing based on party nationality. Karam Chand Thapar & Bros. VS MMTC Ltd. - 2022 Supreme(Del) 137
These principles echo Malaysia's emphasis on early clarity.
While permissible, claims may face hurdles:
In suspicious cases, like disowning then reclaiming foreign currency without proof, courts scrutinize validity—but that's evidentiary, not a blanket ban. (Comparative note from Indian FERA cases)
To maximize success:
Malaysian civil courts typically accept claims in foreign currency for qualifying debts, supported by robust case law and procedural guidelines. By meeting disclosure requirements and leveraging judicial precedents, parties can enforce international obligations effectively.
Key Takeaways:- Jurisdiction exists for foreign currency orders. MEGAH SAKTI SDN.BHD. vs OVERSEA-CHINESE BANKING CORPORATION LIMITED - 2005 MarsdenLR 2871- Mandate: State currency, equivalent, and rate source. MULIAR OLEG & ANOR vs THE OWNERS AND/OR PERSONS IN POSSESSION OR CONTROL OF THE SHIP ORIENTAL DRAGO.... - 2023 MarsdenLR 1372- Local factors often trump foreign forums. MAC PETROLEUM SDN BHD vs EVERMORE ACCESS SDN BHD
Stay proactive in global dealings—proper formulation turns potential pitfalls into enforceable rights. For tailored guidance, consult a Malaysian legal professional.
References: Listed IDs correspond to sourced legal documents for further reading.
#ForeignCurrencyClaims, #MalaysiaLaw, #CivilLitigationMY
[116] Reference was made to the English Civil Procedure Vol 1 (White Book 2023) where at para 16.3.3, it states thus: "Money claim expressed in a foreign currency Where a claim is for a sum of money expressed in a foreign ... This claim is made in RM currency and entails no conversion date. ... Elevic Trading Sdn Bhd [1996] 2 MLRH 311; [1996] 2 CLJ 645 where His Lordship held the view that a plaintiff filing a wri....
The Apex Court has also held that, Arbitrators should provide for the rate of exchange at which the sum is awarded in a foreign currency. ... The present Application filed by the Award-Debtor seeks conversion of the awarded dues denominated in foreign currency in the Foreign Award by applying exchange rate prevailing on the date of the claim being notified to the Company as provided in Clause 1.3.21 of the aforesaid Share Subscription Agreement ... In view of the abov....
The principle that the Court may give judgment in foreign currency is, after all, essentially one of a procedural character." ... The issues are: i. whether the Court has the power to go behind the judgment in default ('JID') that was recorded in a Civil Suit No: MA-B52-7-10/2020 dated 21 December 2020 against the JD to consider the merits of the JC's claim; ii. whether the rate of convertion ... [9] In the case of Muliar Oleg (supra) the High Court had discuss....
Export of foreign currency per se therefore is restricted and failure to fulfill these conditions while exporting makes such foreign currency prohibited goods. ... At all events and even by the remotest of logic can a statute claim to prevail, to the exclusion of all others, in a particularized geographical construct in the face of precedence of statutes having been enunciated by the Hon’ble Supreme Court in re Ashoka Marketing Ltd. ... the scope and extent of empowerment was #HL_STAR....
He also referred to the recent House of Lords case of Miliangos v George Frank (Textiles) Limited in which it was held that an English court was entitled to give judgment for a sum of money expressed in foreign currency. ... and the exchange rate as at the material time and plead in alternative regarding the currency and exchange rate and leave it to the discretion of the Court to fix the currency and exchange rate as the Court may think fit and just. ... based upon ....
the decision of the Sessions Court under civil suit no: MA-B52-NCC-32-08/2023. ... Appeal case 1-01 is against the decision of the Sessions Court under encl 6 to stay all proceedings pending adjudication of the Plaintiff's claim in a foreign forum. ... We hereby...indemnify you...against any claim made against you by anyone as a result of breach by us of any of our warranties as set out above... ... country, or are only seeking procedural advantages; (e) Whether the ....
Appeal case 1-01 is against the decision of the Sessions Court under encl 6 to stay all proceedings pending adjudication of the Plaintiff's claim in a foreign forum. ... No MA-12ANCC-1-01/2024 and MA-12ANCC-2-01/2024 against the decision of the Sessions Court under civil suit no: MA-B52-NCC-32-08/2023. ... We hereby...indemnify you...against any claim made against you by anyone as a result of breach by us of any of our warranties as set out above... ... country, or a....
Non-Reportable IN THE SUPREME COURT OF INDIA CIVIL APPELLATE JURISDICTION CIVIL APPEAL NO.11127 OF 2011 Jatin C. ... He was also specifically questioned in the statement on 12.10.93 and he had made a statement claiming that the seized foreign currency, did not belong to him. ... In so far as currency amounting to US $ 143,300 was concerned, since no one made any claim in respect thereof, the confiscation was confirme....
currency? ... currency. ... currency. ... currency for various services rendered. ... Thus, the Assessee’s claim for foreign exchange loss/increased liability on revaluation of these foreign p
in possession of relevant Currency Declaration Form in support of his claim. ... In so far as currency amounting to US $ 143,300 was concerned, since no one made any claim in respect thereof, the confiscation was confirmed but the personal penalty imposed on Ajit Dodia was reduced to Rs.1 lac. ... Jhaveri has come forward with two Currency, Declaration Forms dated 25.6.93 and 28.6.93 to substantiate his claim that this currency was legally imported i....
In the present case, the petitioner had filed a Statement of Claim claiming certain amounts in foreign currency. The Arbitral Award was dispositive of the disputes between the parties and it is clear from the face of the Arbitral Award that an amount of USD 242,445.03 has been awarded against Claim No.2 along with pre-reference and pendente lite interest at the rate of 12% per annum quantified at USD 181,106.43
Once the plaintiff choose to claim the amount in Indian currency there was no occasion to allow the plaintiff to change its option and claim decree in terms of dollars and for the said proposition reliance has been placed on a case reported in AIR 1984 SC 241, Forasol vs. 9. The main objection which seems to have been pressed by the respondent before the High Court is that the plaintiff has to decide at the time of filing of the suit as to whether the claim is to be made in Indian currency or the foreign currency. The plaintiff must clearly indicate that he would ....
( 45 ) IN the case at hand, the appellants took the first alternative and claimed an amount in INR. A claimant can either claim the amount in INR or in foreign currency payable to him. ( 44 ) THE Supreme Court has made it clear in paragraph 70 of the Report in forasol that any claimant (such as the appellants) has two alternatives available.
Admittedly, the plaint of the plaintiff did not adhere to these formalities. There cannot be any doubt that as per the ratio laid down by the Supreme Court in Forasol case (supra), the plaintiff has to make choice at the time of filing of the suit itself. Plaintiff can either claim in Indian currency or in foreign currency and the formalities required for making the claim in foreign currency are to be clearly spelt out. In the heading as well as in the prayer clause, the decree in terms of rupees by way of US dollars as on the date of filing of the suit is claimed.
In the heading as well as in the prayer clause, the decree in terms of rupees by way of US Dollars as on the date of filing of the suit is claimed. ( 15 ) THERE cannot be any doubt that as per the ratio laid down by the Supreme court in Forasol case (supra), the plaintiff has to make choice at the time of filing of the suit itself. Admittedly, the plaint of theplaintiff did not adhere to these formalities. Plaintiff can either claim in Indian currency or in foreign currency and the formalities required for making the claim in foreign currency are to be clearly spelt out.
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