CHE NORMAH BT CHE KERMA 1. ) ACE CREDIT (M) SDN. BHD. 2. ) CHOONG CHEE MENG 3. ) Chang Ai Nee

CHE NORMAH BT CHE KERMA 1. ) ACE CREDIT (M) SDN. BHD. 2. ) CHOONG CHEE MENG 3. ) Chang Ai Nee

On construction of the agreement it is an investment agreement, not an illegal moneylending transaction; D1 breached by failing to pay the Investment Redemption Sum, and its extension letters and part payments constitute unequivocal acknowledgements of debt; D2 and D3 executed continuing guarantees and are jointly and severally liable; defendants failed to raise any bona fide triable issue or show consent was absent under s.86 such as would discharge the sureties; accordingly summary judgment was entered against D2 and D3 while proceedings against D1 were adjourned due to pending judicial management under s.410(c) Companies Act 2016.

Citation
WA-22NCC-503-10/2022 (Mahkamah Tinggi)
Parties
Plaintiff: Che Normah bt Che Kerma; 1st Defendant: Ace Credit (M) Sdn. Bhd.; 2nd Defendant: Choong Chee Meng; 3rd Defendant: Chang Ai Nee
Court
High Court
Jurisdiction
Malaysia
Judgment Date
17 May 2023
Case Number
WA-22NCC-503-10/2022 (Mahkamah Tinggi)
Procedural Posture
Civil Commercial (contract/guarantee) / Summary Judgment Application Under Order 14 ROC 2012; Judgment on Summary Judgment (partial)
Outcome
Summary judgment granted against 2nd and 3rd Defendants; summary judgment application against 1st Defendant deferred pending resolution of judicial management application under s.410(c) Companies Act 2016.
Legal Topics
Summary Judgment, Guarantee/surety Liability, Investment Vs Loan Characterisation, Illegality of Contracts, Variation of Contract and Consent (s.86), Estoppel and Approbate Reprobate, Judicial Management (s.410 Companies Act 2016)
Source Language
Malay/English
Contract Law Company Law Moneylenders Act Civil Procedure Evidence Law Summary Judgment Guarantee/surety Liability Investment Vs Loan Characterisation +4 more

Case Brief

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Parties

Che Normah bt Che Kerma

Plaintiff

Ace Credit (M) Sdn. Bhd.

1st Defendant

Choong Chee Meng

2nd Defendant

Chang Ai Nee

3rd Defendant

Procedural Posture

Civil Commercial (contract/guarantee) / Summary Judgment Application Under Order 14 ROC 2012; Judgment on Summary Judgment (partial)

Legal Issues

  1. 1 Whether the agreement dated 7.4.2021 is an investment agreement or a loan/moneylending agreement
  2. 2 Whether the plaintiff succeeds on claim and whether the guarantee is enforceable against directors (D2 and D3)
  3. 3 Whether the agreement is illegal under s.24 Contracts Act 1950 and provisions of the Moneylenders Act 1951

Ratio Decidendi

On construction of the agreement it is an investment agreement, not an illegal moneylending transaction; D1 breached by failing to pay the Investment Redemption Sum, and its extension letters and part payments constitute unequivocal acknowledgements of debt; D2 and D3 executed continuing guarantees and are jointly and severally liable; defendants failed to raise any bona fide triable issue or show consent was absent under s.86 such as would discharge the sureties; accordingly summary judgment was entered against D2 and D3 while proceedings against D1 were adjourned due to pending judicial management under s.410(c) Companies Act 2016.

Court Disposition

Summary judgment granted against 2nd and 3rd Defendants; summary judgment application against 1st Defendant deferred pending resolution of judicial management application under s.410(c) Companies Act 2016.

Orders

  • Summary judgment entered against the 2nd and 3rd Defendants (Choong Chee Meng and Chang Ai Nee).
  • Costs to the Plaintiff against the 2nd and 3rd Defendants subject to allocator.