BGMC CORPORATION SDN BHD 1. ) GITA KASTURI SDN. BHD. 2. ) UNITED OVERSEAS BANK (MALAYSIA) BERHAD

BGMC CORPORATION SDN BHD 1. ) GITA KASTURI SDN. BHD. 2. ) UNITED OVERSEAS BANK (MALAYSIA) BERHAD

The performance bond was conditional and the 1st Defendant supplied the required basis when calling the bond; the Plaintiff failed to produce manifest, cogent evidence of unconscionable conduct sufficient to restrain the call; the call was an exercise of contractual rights under the PAM Contract and LoA, therefore the injunction was refused and the originating summons dismissed with costs.

Citation
BA-24C(ARB)-8-06/2025 (Mahkamah Tinggi)
Parties
Plaintiff: BGMC Corporation Sdn Bhd; 1st Defendant: Gita Kasturi Sdn Bhd; 2nd Defendant: United Overseas Bank (Malaysia) Berhad
Court
ARB
Jurisdiction
Malaysia
Judgment Date
28 October 2025
Case Number
BA-24C(ARB)-8-06/2025 (Mahkamah Tinggi)
Procedural Posture
Originating Summons (section 11 Arbitration Act 2005) for Injunction Restraining Call on Performance Bond / High Court Hearing and Judgment on Originating Summons; Application Dismissed With Costs; Appeal Filed
Outcome
Originating Summons dismissed; injunction refused
Legal Topics
Performance Bond, Bank Guarantee, Injunction, Unconscionability, Liquidated Damages, Certificate of Practical Completion, Arbitration (s.11)
Source Language
Malay/English
Arbitration Contract Law Construction Law Banking Law Performance Bond Bank Guarantee Injunction Unconscionability +3 more

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Parties

BGMC Corporation Sdn Bhd

Plaintiff

Gita Kasturi Sdn Bhd

1st Defendant

United Overseas Bank (Malaysia) Berhad

2nd Defendant

Procedural Posture

Originating Summons (section 11 Arbitration Act 2005) for Injunction Restraining Call on Performance Bond / High Court Hearing and Judgment on Originating Summons; Application Dismissed With Costs; Appeal Filed

Legal Issues

  1. 1 Whether conditions to call on the performance bond were fulfilled
  2. 2 Whether the beneficiary's call on the performance bond was unconscionable and thus injunctible

Ratio Decidendi

The performance bond was conditional and the 1st Defendant supplied the required basis when calling the bond; the Plaintiff failed to produce manifest, cogent evidence of unconscionable conduct sufficient to restrain the call; the call was an exercise of contractual rights under the PAM Contract and LoA, therefore the injunction was refused and the originating summons dismissed with costs.

Court Disposition

Originating Summons dismissed; injunction refused

Orders

  • Originating Summons dismissed
  • Plaintiff to pay costs of RM15000 to the Defendant (subject to allocator)