GRANSTEP DEVELOPMENT SDN BHD 1. ) TAN SOON LIN 2. ) TAN SOON CHER 3. ) TAN CHUI HOON 4. ) LEE TIEN LIT

GRANSTEP DEVELOPMENT SDN BHD 1. ) TAN SOON LIN 2. ) TAN SOON CHER 3. ) TAN CHUI HOON 4. ) LEE TIEN LIT

The court held the Performance Guarantee's express terms made it an unconditional on‑demand guarantee payable upon demand without proof of contractor default; the Plaintiff's demand was therefore valid and not premature; the 5th Defendant failed to prove duress; adequate consideration existed under s80 and relevant authorities; enforcement was not unconscionable; judgment entered for the Plaintiff against the 5th Defendant for RM7,800,000 plus interest and costs.

Citation
WA-22C-116-11/2020 (Mahkamah Tinggi)
Parties
Plaintiff: Granstep Development Sdn Bhd; Defendant: Tan Chong Heng; Defendant: Tan Soon Lin; Defendant: Tan Soon Cher; Defendant: Tan Chui Hoon; Defendant: Lee Tien Lit
Court
High Court
Jurisdiction
Malaysia
Judgment Date
2 February 2024
Case Number
WA-22C-116-11/2020 (Mahkamah Tinggi)
Procedural Posture
Civil Suit Performance Guarantee Enforcement (construction) / Judgment (grounds of Judgment)
Outcome
Judgment for the Plaintiff against the 5th Defendant (Lee Tien Lit)
Legal Topics
Performance Guarantee, On Demand Guarantee, Contract Interpretation, Consideration, Duress, Unconscionability, Unjust Enrichment, Enforcement of Guarantees, Interest and Costs
Source Language
Malay/English
Contract Law Construction Law Civil Procedure Insolvency Law Performance Guarantee On Demand Guarantee Contract Interpretation Consideration +5 more

Case Brief

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Parties

Granstep Development Sdn Bhd

Plaintiff

Tan Chong Heng

Defendant

Tan Soon Lin

Defendant

Tan Soon Cher

Defendant

Tan Chui Hoon

Defendant

Lee Tien Lit

Defendant

Procedural Posture

Civil Suit Performance Guarantee Enforcement (construction) / Judgment (grounds of Judgment)

Legal Issues

  1. 1 Whether the Performance Guarantee is an on-demand and unconditional performance guarantee
  2. 2 Whether the Plaintiff properly called on the Performance Guarantee by letter dated 10.8.2020
  3. 3 Whether the call on the Performance Guarantee was premature

Ratio Decidendi

The court held the Performance Guarantee's express terms made it an unconditional on‑demand guarantee payable upon demand without proof of contractor default; the Plaintiff's demand was therefore valid and not premature; the 5th Defendant failed to prove duress; adequate consideration existed under s80 and relevant authorities; enforcement was not unconscionable; judgment entered for the Plaintiff against the 5th Defendant for RM7,800,000 plus interest and costs.

Court Disposition

Judgment for the Plaintiff against the 5th Defendant (Lee Tien Lit)

Orders

  • Judgment in favour of the Plaintiff against the 5th Defendant for RM7,800,000.00
  • Pre-judgment interest at 5% per annum on RM7,800,000.00 from date of filing of writ until date of judgment