Chan Kheng Hoe and Rachel Lim Han Ying [Messrs. Chong + Keng Hoe] K. Kirubakaran [Messrs. Selva Mookiah & Associates]

Chan Kheng Hoe and Rachel Lim Han Ying [Messrs. Chong + Keng Hoe] K. Kirubakaran [Messrs. Selva Mookiah & Associates]

The Guarantees and associated indemnities are void and unenforceable because they are founded on the Deferred Payment Scheme which is forbidden by law under s35 CIPAA; accordingly no legal obligation can arise from the Guarantees and the Plaintiff is estopped from asserting an inconsistent position taken in adjudication.

Citation
WA-22C-60-08/2021 (Mahkamah Tinggi)
Parties
Plaintiff: SCEC GROUP (MALAYSIA) SDN BHD; 1st Defendant: PASTPRESENTFUTURE SDN BHD (formerly Poly Ritz Sdn Bhd); 2nd Defendant: WONG SIEW WOON; 3rd Defendant: LEE POH WAH; 4th Defendant: CHAN BAOJIE
Court
High Court
Jurisdiction
Malaysia
Judgment Date
16 November 2022
Case Number
WA-22C-60-08/2021 (Mahkamah Tinggi)
Procedural Posture
Civil Suit (construction Contract Dispute) / Order 14 a Application (challenge to Enforceability of Guarantees Following Adjudication)
Outcome
Guarantees declared null and void; Plaintiff's enforcement claim on the Guarantees dismissed; costs awarded to the Defendants
Legal Topics
Deferred Payment Scheme, Guarantees and Indemnities, CIPAA Section 35, Void Contracts, Estoppel, Enforceability of Securities
Source Language
Malay/English
Construction Law Contract Law Civil Procedure Security and Guarantees Statutory Interpretation Deferred Payment Scheme Guarantees and Indemnities CIPAA Section 35 +3 more

Case Brief

Summary, issues, holding and outcome

More case intelligence is available

Unlock the full research layer for this judgment.

Full judgment text Downloadable case file Legal principles 5 Authorities cited 8 Party arguments 2 Amounts and remedies 3
Sign in to unlock

Parties

SCEC GROUP (MALAYSIA) SDN BHD

Plaintiff

PASTPRESENTFUTURE SDN BHD (formerly Poly Ritz Sdn Bhd)

1st Defendant

WONG SIEW WOON

2nd Defendant

LEE POH WAH

3rd Defendant

CHAN BAOJIE

4th Defendant

Procedural Posture

Civil Suit (construction Contract Dispute) / Order 14 a Application (challenge to Enforceability of Guarantees Following Adjudication)

Legal Issues

  1. 1 Whether the corporate and individual guarantees are valid and enforceable
  2. 2 Whether the guarantees are null and void because they are founded on a Deferred Payment Scheme held void under s35 CIPAA
  3. 3 Whether the indemnity within the guarantees is severable from the void consideration

Ratio Decidendi

The Guarantees and associated indemnities are void and unenforceable because they are founded on the Deferred Payment Scheme which is forbidden by law under s35 CIPAA; accordingly no legal obligation can arise from the Guarantees and the Plaintiff is estopped from asserting an inconsistent position taken in adjudication.

Court Disposition

Guarantees declared null and void; Plaintiff's enforcement claim on the Guarantees dismissed; costs awarded to the Defendants

Orders

  • The Corporate and Individual Guarantees dated 14.10.2019 are declared null and void and not enforceable
  • Prayer 1(a) dismissed (Guarantees are not valid and enforceable)