Dalam mahkamah tinggi malaya di kuala lumpur

Oriental Bank Bhd can be explained on the ground that there was a manifest error. In Chen Heng Ping v Intradagang Merchant Bankers (M) Bhd [1995] 2 MLJ 363, at 369-370, the Court of Appeal held as follows:

“… even though the guarantors are contractually precluded from requiring the bank to prove the accuracy of the certificate, it does not prevent the guarantors from adducing evidence to show that there is a manifest error on the face of the certificate or fraud. The initial onus is on the guarantors. The court is not bound by the contractual provision in the guarantee. When evidence is produced which casts doubts on the accuracy of the certificate, it should not accept the certificate as conclusive. It is then for the plaintiff to prove the quantum of the debt claimed in accordance with the requirements of the Evidence Act 1950.

In the two judgments just cited [including Oriental Bank Bhd] … there was evidence of manifest error.”
(emphasis added).

60. 
    It is to be emphasized that Oriental Bank Bhd did not deal with the appeal against the summary judgment ordered by the SAR. In fact, the plaintiff’s certificate of indebtedness was not adduced in the FBP application. The plaintiff bank merely relied on the conclusiveness of the certificate of indebtedness clause in the guarantee to oppose the FBP application and that opposition was not successful in Oriental Bank Bhd. Nor did Oriental Bank Bhd refer to the earlier Federal Court’s judgment in Citibank.
    

61. 
    In any event, I am bound by the Federal Court decisions in Cempaka Finance Bhd and Citibank which allow the Plaintiff to rely solely on the Plaintiff’s Certificate of Indebtedness under Clause 12 without proving the Borrower’s indebtedness under the Banking Facilities.
    

62. 
    The onus is on the 1^st and 2^nd Defendants to disprove the Outstanding Sums certified in the Plaintiff’s Certificate of Indebtedness - Cempaka Finance Bhd, at p. 691. This is consistent with the burden on the 1^st and 2^nd Defendants to raise a triable issue in This Application (please see Cempaka Finance Bhd, at p. 551-552, and National Company for Foreign Trade, at 285). The 1^st and 2^nd Defendants cannot discharge this burden to disprove the Outstanding Sums certified in the Plaintiff’s Certificate of Indebtedness by merely alleging that there is a manifest error in the Plaintiff’s Certificate of Indebtedness. In this case, the affidavit of the 1^st and 2^nd Defendants did not even allege manifest error in the Plaintiff’s Certificate of Indebtedness. Paragraph 18 of the affidavit of the 1^st and 2^nd Defendants disputed all the paragraphs of the Plaintiff’s 1^st Affidavit (General Denial). As held by the Court of Appeal in Chen Heng Ping, at p. 367 –
    

“When an application is made for summary judgment under O 14 supported by an affidavit which goes to show that there is no defence, the defendants must show cause why leave to defend must be given. This means that the defendants must provide answers on oath which constitute evidence that they have a defence which is fit to be tried. Denials in a defence do not constitute evidence. They are challenges to the other side to show proof. In the present case the guarantors do not appear to have appreciated this. Their affidavits merely relied on the defence they pleaded, which consists of bare denials and points of law which they could not sustain.”

(emphasis added).
Based on Chen Heng Ping, the General Denial cannot discharge the onus on the 1^st and 2^nd Defendants to raise a triable issue that there is a manifest error concerning the Plaintiff’s Certificate of Indebtedness.

63. 
    In Malaysia Debt Ventures Bhd v MK Construction & Communication Sdn Bhd & Ors [2012] MLJU 308, at p. 8-9, the High Court held that a mere challenge by the debtor to the lender to particularize the payments made by the debtor, is not sufficient to oppose a summary judgment application.
    

64. 
    Contrary to the submission by the 1^st and 2^nd Defendants, I hold that the Plaintiff need not adduce evidence to prove the Borrower’s indebtedness under the Banking Facilities such as the Borrower’s bank statements. If otherwise, the purpose and efficacy of Clause 12 will be defeated. To require the Plaintiff to adduce evidence in the form of bank statements to prove the Borrower’s indebtedness under the Banking Facilities, in my view, will be contradicting, varying or adding to Clause 12 which is not permitted by ss 91 and 92 EA (please see Tindok Besar Estate Sdn Bhd, at 227-228).
    

65. 
    In this case, the 1^st and 2^nd Defendants did not allege fraud on the Plaintiff’s part. In fact, the 1^st and 2^nd Defendants are on a weaker footing to challenge the Plaintiff’s Certificate of Indebtedness because -
    

(a) there are 3 Admissions of Indebtedness in this case. The Borrower’s Letter dated 22.2.2012 and SHSB’s Letter dated 18.3.2013 had been signed by the 1^st Defendant himself. It is difficult for the 1^st Defendant to contend that he has no knowledge of the Borrower’s indebtedness under the Banking Facilities;

(b) as explained above, there is no basis for the Alleged Set-off;
(c) in paragraphs 7 and 8 of the Plaintiff’s 1^st Affidavit, it was affirmed that -
(i) the Outstanding Sums were based on the Plaintiff’s ledgers (Plaintiff’s Ledgers) which were used in the ordinary business of the Plaintiff;
(ii) entries were made in the Plaintiff’s Ledgers in the ordinary business of the Plaintiff;
(iii) the Plaintiff’s Ledgers are always kept in the Plaintiff’s custody; and
(iv) the Outstanding Sums stated in the Plaintiff’s Certificate of Indebtedness were checked based on the original entries in the Plaintiff’s Ledgers and the Outstanding Sums were found to be correct;
(d) the 1^st and 2^nd Defendants did not even reply to the Plaintiff’s Demand;
(e) the solicitors for the 1^st and 2^nd Defendants did not request at any time from the Plaintiff’s solicitors for details of the Borrower’s indebtedness under the Banking Facilities;
(f) the 1^st and 2^nd Defendants could have applied for FBP under Order 18 rule 12(3) RC as had happened in Oriental Bank Bhd. Such a course of action was not taken by the 1^st and 2^nd Defendants. In any event, I refer to the Court of Appeal’s decision in Chen Heng Ping, at p. 370, which held that where manifest error on the face of a certificate of indebtedness is not shown, a FBP application would be a “fishing expedition”; and
(g) the affidavit of the 1^st and 2^nd Defendants did not aver any manifest error on the face of the Plaintiff’s Certificate of Indebtedness.
N. 1^st and 2^nd Defendants are bound by 3 Guarantees

66. 
    I do not accept the contention that in view of the Alleged Set-off, it is unconscionable for the Plaintiff to succeed in This Application. I decide as such for the following reasons:
    

(a) the applicable clauses in the 3 Guarantees are clear and should be given legal effect. I quote Scrutton LJ in L'Estrange v F Graucob Ltd [1934] All ER 16, at 19, as follows:

“That being so, the plaintiff, having put her signature to the document and not having been induced to do so by any fraud or misrepresentation, cannot be heard to say that she is not bound by the terms of the document because she has not read them.”;
(b) in this case, the 1^st Defendant is the Borrower’s CEO. There is nothing extraordinary for the 1^st Defendant to give the 3 Guarantees to secure the repayment of Banking Facilities given by the Plaintiff to the Borrower. In Chong Hin Trading Co Sdn Bhd & Ors v Malayan Banking Bhd [2004] 4 MLJ 453, at 463, the Court of Appeal held that the second and third appellants as directors of the first appellant company, were aware that they were required to execute a guarantee as one of the securities required by the respondent bank before the term loan facility was released to the first appellant company; and
(c) the documentary evidence in this case has shown the Plaintiff’s indulgence in entering into the Settlement and the discontinuance of the 1^st Suit. Ample time has been given to the Borrower and all the 3 defendants in This Suit to settle the Outstanding Sums.
O. No other reason for trial

67. 
    I find that there is no circumstance in this case which ought to be investigated. Hence, there is no other reason for trial in the present case.
    

P. Court’s decision

68. 
    In view of the above reasons, This Application is allowed with costs.
    

WONG KIAN KHEONG

Judicial Commissioner

High Court (Commercial Division)

Kuala Lumpur

DATE: 22 AUGUST 2014

For the Plaintiff: SM Lim and KH Wong (Messrs Raja Darryl & Loh)

For the First and Second Defendants: K. Mano and R. Mageswaran (Messrs K. Mano & Associates)