UNITED OVERSEAS BANK (CHINA) LIMITED, CHENGDU BRANCH SIOW KWANG JOON@SIOW KWONG SHANG

23 August 2020 JA-22NCC-22-04/2019 DALAM MAHKAMAH TINGGI DI JOHOR BAHRU DALAM NEGERI JOHOR DARUL TAKZIM, MALAYSIA GUAMAN SIVIL NO: JA-22NCC-22-04/2019 BETWEEN UNITED OVERSEAS BANK (CHINA) LIMITED, CHENGDU BRANCH .PLAINTIFF AND SIOW KWANG JOON @ SIOW KWONG SHANG (NO. KP: 470608-01-5873) : .. DEFENDANT He BEA AE AE HAE HE SE GE SE SE AE OE ae ae aE ee ae ae ae ae ae ee ee ae ae ae ae ae ae ae GROUNDS OF JUDGMENT FR HE BE HE EEE EE He Ee Se SA Se SAE aie ae at ae ae ae ae ae ae aie ae ae ake Se Ge ae ie Ge ae [EVROL MARIETTE PETERS JC] ae 23 August 2020 JA-22NCC-22-04/2019 This Application [1] This is an application (“this Application”) in Enclosure 48 by the Defendant to amend his Defence, which was dismissed by this Court based on the following reasons. The brief facts [2] The Plaintiff, a licensed Chinese financial institution, by way of two letters of offer dated 27 December 2012 and 9 May 2014, granted financing facilities to a Chinese company, Foh Chong (Guangxi) Chemical Co. Ltd. (“FCGC’) for an amount up to RMB 92.5 million (“FCGC Facilities”). [3] The Defendant is a director of FCGC, and has an interest in it through his company, Foh Chong & Sons Sdn Bhd, where he is a shareholder. The Defendant executed a personal guarantee dated 9 May 2014 (“the Guarantee”) to secure repayment of the FCGC Facilities. FCGC defaulted in the FCGC Facilities since 31 January 2015, and in February 2019, the Plaintiff called on the Defendant's obligation under the Guarantee. Notices of demand were issued to the Defendant on 18 February 2019 and 25 February 2019, to which the Defendant had not replied. [4] The Plaintiff filed the Writ of Summons and Statement of Claim on 30 April 2019, whilst the Defence was filed on 26 June 2019, and subsequently the Plaintiffs Reply filed on 10 July 2019. [EVROL MARIETTE PETERS JC] Pe 23 August 2020 JA-22NCC-22-04/2019 [5] [6] [7] [8] At the second case management, the Court issued directions for parties to file all interlocutory applications by 10 July 2019, and pursuant to those instructions, the Defendant had filed his application for security for costs (Enclosure 6), and an application to strike out the Plaintiffs claim (Enclosure 8); whilst the Plaintiff had filed its application for summary judgment (“Enclosure 10”). Pursuant to the Defendant’s requests for more time to file an affidavit to adduce an opinion (“the Opinion”) from lawyers from China, the Court directed the Defendant to file his affidavit containing the Opinion on or before 30 November 2019, and that no further affidavit or Opinion was to be filed after that date. At the seventh case management on 23 December 2019, directions were given for written submissions to be filed on 15 January 2020. However on 10 January 2020, the Defendant filed his third Affidavit- In-Reply to oppose Enclosure 10, which was not only filed out of time, but did not contain the Opinion that he claimed he had intended to seek. This Third Affidavit was excluded pursuant to objections raised by the Plaintiff. On 14 January 2020, just a day before parties were directed to file written submissions for Enclosure 10, this Application was filed. The Defendant’s case [9] The Defendant's case is that the proposed amendments were merely to tweak the already pleaded Defence and that there were merely [EVROL MARIETTE PETERS JC] ea) 23 August 2020 JA-22NCC-22-04/2019 Slight differences between the original Defence and the amended one. [10] The Defendant further contended that these amendments were necessary, and that there was no delay in filing this Application. The Plaintiff's case [11] The Plaintiff resisted this Application on the following grounds: a) That it would change the character of the Defence as the Defendant had sought to amend and insert new defences in his Defence; and b) That it was not a bona fide application as it was a tactical manoeuvre to delay the hearing of Enclosure 10. The law [12] This Application is made under Order 20 rule 5 of the Rules of Court 2012 (“Rules of Court”), which reads Order 20 - Amendments Rule 5. Amendment of writ or pleading with leave (1) Subject to Order 15, rules 6, 6A, 7 and 8 and the following provisions of this rule, the Court may at any stage of the proceedings allow the plaintiff to amend his writ, or any party to amend his pleading, on such terms as to costs or otherwise as may be just and in such a manner, if any, as it may direct. [EVROL MARIETTE PETERS JC] Ae 23 August 2020 JA-22NCC-22-04/2019 [13] [14] [15] [16] [17] The judge has a discretion to allow an application amend a pleading but such powers must be exercised judicially. The two leading cases on the applicable principles by the courts in dealing with applications to amend pleadings are Yamaha Motor Co Ltd v Yamaha (M) Sdn Bhd [1983] CLJ (Rep) 428, and Hong Leong Finance Berhad v Low Thiam Hoe & Another Appeal [2015] 8 CLJ. In the Federal Court case of Yamaha Motor Co Ltd v Yamaha (M) Sdn Bhd, Mohd Azmi FCJ in delivering the judgment, stated the law as follows: The general principle is that the Court will allow such amendments as will cause no injustice to the other parties. Three basic questions should be considered to determine whether injustice would or would not result, (1) whether the application is bona fide; (2) whether prejudice caused to the other side can be compensated by costs and (3) whether the amendments would not in effect turn the suit from one character into a suit from one character into a suit of another and inconsistent character. On the issue of delay in filing an application amend a pleading, the established principle is that the onus is on the applicant to furnish a reasonable explanation for such a delay and that the failure to do so would result in the application being disallowed. Furthermore, the application amend a pleading will also be disallowed if the application to amend is made as a tactical manoeuvre. Thus in the Federal Court case of Hong Leong Finance Berhad v Low Thiam Hoe & Another Appeal, Zulkifli Anmad Makinuddin CJ stated and applied the following principles: [EVROL MARIETTE PETERS JC] Bee 23 August 2020 JA-22NCC-22-04/2019 Having considered the facts and the circumstances of the present case, our views are as follows: (a) When dealing with an application to amend the pleadings, which introduce a new case in the claim or defence, on the eve of the trial, the principles in Yamaha Motor are not the sole considerations; (b) The principles in Yamaha Motor applies to cases where the application to amend the pleadings is made at an early stage of the proceedings; (c) That there has to be a cogent and reasonable explanation in the applicant's affidavit as to why the application was filed late; (d) That the application to amend the pleadings is not a tactical manoeuvre; (e) That the proposed amendment must disclose full particulars for the court to ascertain if there is a real prospect of success in proving the same; and (f) That lateness in the application to amend the pleadings cannot necessarily be compensated by payment of costs. Contentions, evaluation, and findings Whether the proposed amendments would change the character of the Defence [18] The Defendant’s original defence in paragraph 8 of the Defence was that the Guarantee was “null and void and of no legal effect against the Defendant” due to the breach of the Plaintiffs warranty and representation given, that is, that the Plaintiff had failed “... to commence and/or proceed with legal proceedings to enforce the guarantee against the other four guarantors whether simultaneously or at all’. [EVROL MARIETTE PETERS JC] be) 23 August 2020 JA-22NCC-22-04/2019 [19] [20] The proposed amendments, if allowed, would see paragraph 8 deleted and paragraphs 7A, 7B, 7C, 7D and 8A introduced — which would have the effect of abandoning the original averment that the Guarantee is null and void and of no effect, and would now aver that the Plaintiff's claim is “premature” due to an alleged collateral contract, and that the Plaintiff is, therefore, “estopped from filing this suit.” In my view, the proposed amendments would definitely have the effect of changing the character of the Defence as the initial averment that the Guarantee is “nul! and void and of no legal effect’ would be replaced with the claim that Plaintiff's claim is “premature” due to an alleged collateral contract, and that the Plaintiff is therefore “estopped from filing this suit.” Whether there was delay in filing this Application [21] The issue of delay was raised by the Plaintiff due to the timing of the filing of this Application. It is pertinent to note that this Application was filed after seven case managements, and the amendments were only sought when parties were in the midst of complying with directions for filing written submissions for the hearing of Enclosure 10. [22] The Defendant argued that Order 20 rule 1 of the Rules of Court states that the ‘Court may at any stage of the proceedings allow the plaintiff to amend his writ, or any party to amend his pleading’, and that in this case, this Application was filed only seven months from [EVROL MARIETTE PETERS JC] 23 August 2020 JA-22NCC-22-04/2019 [23] [24] [25] the date the Defence was filed, as opposed to cases such as Hong Leong Finance Berhad v Low Thiam Hoe & Another Appeal where the amendment was made at the eve of the trial. The Defendant had also relied on the cases of Public Bank Bhd v Kemajuan Flora Sdn Bhd [2003] 1 CLJ 790 and YB Datuk Dr Soon Choon Teck v YB Datuk Robert Lau Hoi Chew & Ors [2009] 3 MLJ 785, to indicate that unlike those cases, where the Courts held that there was no delay despite having filed the amendments nine months after the defence was filed, in the present case the amendments were made only six months later. The Defendant submitted that his argument was fortified by the fact that the trial dates had not even been scheduled. | am unable to agree with the Defendant in view of the fact that the issue of delay was not reduced to merely calculating the number of months between the date of filing the Defence and the amendments. Instead, delay must be looked at in the context of the facts and the other applications filed therein. Secondly, the cases cited by the Defendant are distinguishable on the facts. For instance, in Public Bank Bhd v Kemajuan Flora Sdn Bhd [2003] 1 CLJ 790, the amendments were sought merely to expand the original statement of claim, unlike the present case, where the amendments had changed the character of the Defence. Thirdly, in this case, although trial dates had not been fixed, directions had already been given to file submissions for the hearing of Enclosure 10. At this juncture, | find instructive and relevant the [EVROL MARIETTE PETERS JC] Ga] 23 August 2020 JA-22NCC-22-04/2019 case of Ismail bin Ibrahim & Ors v Sum Poh Development Sdn Bhd & Anor [1988] 3 MLJ 348, where the application to amend was disallowed as the same was found to be an attempt to circumvent the application to strike out the original writ and the statement of claim. Whether this Application lacked bona fide [26] [27] [28] [29] The Plaintiffs submission was that the timing of this Application raised the issue of bona fides or lack thereof, and it was, therefore, a tactical manouevre to resist the application in Enclosure 10. Where there is delay in making an application to amend, the applicant must ‘place some material and advance some cogent reasons to impel the court to lean on his side’, failing which, the inference is that the “application borders on lack of bona fides”: per Haidar JCA in Taisho Co Sdn Bhd v Pan Global Equities Bhd & Anor [1999] 1 MLJ 3591 adopting the Singapore case of Multi-Pak Singapore Pte Ltd (In receivership) v Intraco Ltd & Ors [1993] 2 SLR 113. The Defendant averred that he had intended to obtain the Opinion pertaining to the issue of choice of law clause in the Guarantee, that is, whether the laws of China would prevail, although Malaysian law was stated as the governing law of the Guarantee. | find this unconvincing as the Defendant did not explain why the allegations in the proposed amendments, which if true, were not mentioned in the original Defence, bearing in mind that these facts were readily available at the time the Defence was filed. In (EVROL MARIETTE PETERS JC] | 23 August 2020 JA-22NCC-22-04/2019 [30] [31] [32] [33] connection with this, there is was no explanation whatsoever for the change of position pursuant to the proposed amendments. On this note, reference is again made to /smail bin Ibrahim & Ors v Sum Poh Development Sdn Bhd & Anor where it was held that the circumstances in which an amendment would not be permitted are: (a) where the facts giving rise to the amendment were known at the time of the original pleading; and (b) where the delay in making the amendment was in connection with some tactical manoeuvre. In fact, in his Affidavit-In-Reply dated 30 August 2019 pertaining to Enclosure 10, the Defendant had referred to facts that he had sought to incorporate in the Defence through this Application. Bearing in mind that these were facts that were inconsistent with the pleaded original Defence, the Defendant could have taken steps to amend the Defence immediately before or after 30 August 2019, and yet had not done so. The same concerns were expressed in Lim Nyang Tak Michael v ACE Technologies Sdn Bhd [1995] 4 MLJ 616, where in dismissing the defendant's application to amend the defence, the Court held that if the defendant truly had a valid defence, it would not have waited, and the fact that it did, raised the inference that the application was a tactical manoeuvre and was done in bad faith to delay the rights of the plaintiff on his claim. Both /smail bin Ibrahim & Ors v Sum Poh Development Sdn Bhd & Anor and Lim Nyang Tak Michael v ACE Technologies Sdn Bhd [1995] 4 MLJ 616 were approved and adopted by the court in Jupiter [EVROL MARIETTE PETERS JC] fo | 23 August 2020 JA-22NCC-22-04/2019 Securities Sdn Bhd v Wan Yaakub Bin Abd Rahman [2002] 3 MLJ 2644. [34] Since the facts were already known to the Defendant at the time the original Defence was filed, coupled with the filing of this Application at the eleventh hour, the irresistible inference is that filing of this Application was in connection with some tactical manoeuvre. [35] Furthermore, if this Application is allowed, it is my view that the Plaintiff would suffer prejudice that cannot be compensated by costs. Conclusion [36] In the upshot, based on the aforesaid reasons, and after careful scrutiny of all the evidence before this Court, both oral and documentary, and submissions of Counsel for both parties, this Application was dismissed with costs in the amount of MYR5,000 (subject to allocatur fees). Dated: 23 August 2020 (EVROL MARIETTE PETERS) Judicial Commissioner High Court, Johor Bahru [EVROL MARIETTE PETERS JC] 23 August 2020 JA-22NCC-22-04/2019 Counsel: For the Plaintiff - Andrew Chiew Ean Vooi and Nicola Tang Zhan Ying; Messrs Lee Hishammuddin Allen & Gledhill For the Defendant — Ranjit Singh and KC Tho; Messrs KC Tho Cases referred to: > Hong Leong Finance Berhad v Low Thiam Hoe & Another Appeal [2015] 8 CLJ >» Ismail bin Ibrahim & Ors v Sum Poh Development Sdn Bhd & Anor [1988] 3 MLJ 348 > Jupiter Securities Sdn Bhd v Wan Yaakub Bin Abd Rahman [2002] 3 MLJ 2644 >» Lim Nyang Tak Michael v ACE Technologies Sdn Bhd [1995] 4 MLJ 616 > Multi-Pak Singapore Pte Ltd (In receivership) v Intraco Ltd & Ors [1993] 2 SLR 113 >» Public Bank Bhd v Kemajuan Flora Sdn Bhd [2003] 1 CLJ 790 > Taisho Co Sdn Bhd v Pan Global Equities Bhd & Anor [1999] 1 MLJ 3591 >» Yamaha Motor Co Ltd v Yamaha (M) Sdn Bhd [1983] CLJ (Rep) 428 >» YB Datuk Dr Soon Choon Teck v YB Datuk Robert Lau Hoi Chew & Ors [2009] 3 MLJ 785 (EVROL MARIETTE PETERS JC] : ig | 23 August 2020 JA-22NCC-22-04/2019 Legislation referred to: > Rules of Court 2012, Order 20 rule 5 [EVROL MARIETTE PETERS JC] aa |