Marcus van Geyzel and I have just launched The Malaysian Lawyer website. It is a collaborative blog between two lawyers, and we’ll share our experience on a variety of legal and non-legal matters. Marcus is a co-founder of his corporate boutique law firm and is a corporate lawyer. On the other hand, I will share more from my perspective as a corporate litigator.
The Federal Court in its decision dated 7 April 2015 in Damai Freight (M) Sdn Bhd v Affin Bank Berhad clarified an important issue of law, especially for banks and secured lenders.
The question of law posed to the Federal Court was:
“Whether a lender having an absolute assignment of rights to land may realise his security under the terms of the assignment, where the document of title to the land was issued subsequently, without the need to resort to the remedies under the National Land Code (NLC).”
The answer to this is yes.
In summary, the Federal Court’s findings were:
- There was an absolute assignment and not one by way of charge only. The Bank should have all the rights, title and interest of the assignor.
- When the title was issued to the Land, the Bank did not lose its security or its power of sale under the Loan Agreement Cum Assignment (LACA). The absolute assignment under the LACA survives.
- The Bank is thus empowered to realise its security for the loans by way of private sale of the Land.
- There is no necessity for the Bank to first create a charge or to resort to foreclosure under the NLC to realise its security. The Bank’s recovery action stands independently.
- Section 206(3) of the NLC allows such a transaction relating to any alienated land to give effect to the contractual obligations and rights of the parties as they had determined in the LACA.
I will be giving a talk on 10 December 2013 at Renaissance Hotel as part of the Breach of Contract 2013 talk. I will be covering the sessions on breach of contract and options available following such a breach.
Here is the registration form if you are interested in attending.
I have attached the Singapore Court of Appeal Grounds of Judgment for the Astro v Lippo dispute. I had earlier written a commentary analysing the High Court’s decision and the Court of Appeal has now allowed the Lippo Group’s appeal. This meant that the Court of Appeal allowed the setting aside of a majority of the enforcement orders for the arbitral awards.
The grounds are reported as PT First Media TBK v Astro Nusantara International BV & 7 others  SGCA 57.
The ongoing conflict between See Teow Chuan and the Liquidators of Kian Joo Holdings Sdn Bhd (KJHSB) continue to rumble on. I had covered the Court of Appeal decision which had far-reaching effects on establishing conflict of interest on the part of liquidators. This decision was subsequently overturned by the Federal Court. The Federal Court grounds of judgment are out and I will follow up with a case commentary shortly.
See Teow Chuan and the other majority contributories of KJHSB then filed an application for a review of the Federal Court decision. It was reported that the main ground for the review is on the issue of plagiarism; that the Federal Court had substantially adopted the written submissions of the Liquidators’ solicitors in writing its grounds of judgment.
Far-fetched perhaps but what was unexpected was the step then taken by the Liquidators in applying to cite the majority contributories and their Counsel, Datuk VK Lingam, for contempt of court. An application for leave to issue committal proceedings has been filed. An interesting step and one which the Federal Court appears to be taking quite seriously and the Attorney-General will be intervening as well to put forward his views.
The news report from the New Straits Times is set out below.
Application filed to cite lawyer for contempt
‘DISRESPECT TO COURT’: Lingam and clients had asked for case to be reviewed alleging Federal Court judges had plagiarised liquidators’ submission in written judgment.
Prominent lawyer Datuk V.K. Lingam and his clients in a civil suit are facing possible contempt charges after accusing a Federal Court bench of alleged plagiarism in their written judgment.
Lingam and his clients, Kian Joo Can Factory Bhd (KJCF) group managing director Datuk See Teow Chuan and 13 others, had accused the bench, led by Chief Judge of Malaya Tan Sri Zulkefli Ahmad Makinudin, of producing the submissions of the respondents, “lock, stock and barrel”, in the written judgment against the appellants.
The High Court had earlier allowed the liquidators, Ooi Woon Chee and Ng Kim Tuck, to sell the shares of (KJCF) to a company, Can-One Sdn Bhd.
See and 13 others appealed against the High Court’s decision, which the Court of Appeal allowed.
The liquidators, however, took the case to the Federal Court which reinstated the High Court ruling.
Following the Federal Court ruling, See and 13 others had on Feb 21, filed a review of the ruling, citing the grounds that the previous bench, led by Zulkefli, had committed plagiarism in their written grounds.
They alleged that the written judgment glaringly showed plagiarism as they “consisted very largely and substantially the reproduction, without any attribution, of the liquidators, Ooi and Ng’s written submission.
Yesterday at the Federal Court, Tan Sri Cecil Abraham, appearing for the liquidators, told a five-man bench chaired by Chief Justice Tan Sri Arifin Zakaria, that an application to obtain leave had been filed to cite Lingam, See and 13 others, for contempt.
“Their grounds for a review, showed disrespect to the court,” said Abraham, adding that he had invited Attorney-General Tan Sri Gani Patail to be a party in the proceedings.
“He has indicated his desire to be an intervener.”
Arifin agreed that the A-G should be present, and even the court could invite him, as it was a case of public interest. “This case is a serious allegation which affects the integrity of the judiciary.”
Cecil informed the court that the leave application was an ex-parte matter and Lingam wanted to be a party.
“We want to be heard during the leave stage as this is a serious issue, coming for the first time in this court,” Lingam said, adding that he may consider filing a counter-contempt proceeding against the liquidators.
Arifin said the court would decide later whether to also allow Lingam to be an intervener before he adjourned proceeding to April 3.
Lawyer Ranjit Singh is holding a watching brief for the Malaysian Bar.
See and 13 others, are in a legal dispute over KJCF shares, and are asking for an order of a re-hearing of two appeals by a new panel of Federal Court judges.
They said this was an appropriate case for the court to invoke its inherent jurisdiction to review the judgment and set it aside.
See and the others are the majority contributors of family investment holding company Kian Joo Holdings Sdn Bhd, which was ordered by a High Court to be wound up in 1996.
We then have our de facto Minister of Law accusing the Bar, by passing the resolution, of trying to intimidate the enforcement authorities from discharging their duties.
It is clear that the Government has taken the position that nothing wrong was done. There has been no denouncement of the treatment of the lawyers, no acknowledgment that there is something wrong with the system, and that now, the Bar is in the wrong for passing such a resolution. Ridiculous.