Malaysia Case Law: Decisions & Judgments | LexChat

Topic

Bank guarantee payable on demand

Legal area

Court

11 Jul 2024

Panzana Enterprise Sdn Bhd Turnpike Synergy Sdn Bhd

Citation

B-02(C)(A)-516-03/2022 (Mahkamah Rayuan)
Court

C
Case number

B-02(C)(A)-516-03/2022 (Mahkamah Rayuan)

The Court held that s7 of the COVID-19 Act applied to suspend the appellant's contractual obligations during the statutory period, rendering the Notice of Default and Notice of Termination null and void in that period, and that permitting the respondent to call on the bank guarantees in those circumstances would be unconscionable; accordingly the appeals were allowed and the High Court order setting aside the ex parte injunction was reversed and replaced by relief restraining receipt of the guarantees' proceeds as claimed in Encl 1 paras 1(a)–(c).
11 Jul 2024

Panzana Enterprise Sdn Bhd Turnpike Synergy Sdn Bhd

Citation

B-02(IM)(C)-517-03/2022 (Mahkamah Rayuan)
Court

IM
Case number

B-02(IM)(C)-517-03/2022 (Mahkamah Rayuan)

The Court held that s7 of the COVID‑19 Act operated to suspend the appellant's contractual obligations during the Act's operative period; because the Notice of Default and Notice of Termination were issued within that period they were null and void under s7, and a call on the bank guarantees issued under the underlying contract would be unconscionable — unconscionability being a recognised exception to the autonomy of unconditional guarantees — therefore the High Court's refusal to grant relief was overturned and the injunction/declarations sought were granted.