MALAYSIA

IN THE HIGH COURT IN SABAH AND SARAWAK AT KUCHING

[SUIT NO: 22-201-2008-III]
BETWEEN
TAN SENG LEONG CONSTRUCTION SDN BHD
(COMPANY NO. 1!2-D"
A COMPANY INCORPORATED AND
REGISTERED IN MALAYSIA UNDER THE
COMPANIES ACT# 1$% AND HA&ING
ITS REGISTERED AND BUSINESS
ADDRESS AT 18' 1
ST
(LOOR LOT )
HUI SING GARDEN COMMERCIAL CENTRE
$''0 KUCHING SARAWAK * PLAINTI((
AND
(1" MASPOH SDN BHD
(COMPANY NO. 12%)12-T"
A COMPANY INCORPORATED
AND REGISTERED IN MALAYSIA
UNDER THE COMPANIES ACT#
1$% AND HA&ING ITS REGISTERED
ADDRESS AT LOT 1!2 (1
ST
(LOOR"
SECTION %' KTLD +ALAN
PADUNGAN
$'100 KUCHING SARAWAK * 1
ST
DE(ENDANT
(2" POH SU KIANG
(WN KP. )%111$-1'-0!$"
C,O MASPOH SDN BHD
LOT 1!2 (1
ST
(LOOR"
SECTION %' KTLD
+ALAN PADUNGAN
$'100 KUCHING SARAWAK * 2
ND
DE(ENDANT
BE(ORE THE HONOURABLE
MR. +USTICE DATUK LINTON ALBERT IN OPEN COURT
1
CONTRACT: Guarantee - Liability of guarantor - Sum retained by 1
st
defendant which had not been settled - Whether Letter of Acknowledgment of
Debt cum Guarantee rendered 2
nd
defendant liable to settle sum if 1
st
defendant defaulted - Whether a mere promise to transfer personal property
- Whether guarantee was without consideration - Whether 2
nd
defendant
signed Letter of Acknowledgment of Debt cum Guarantee under duress and
coercion - Whether Letter of Acknowledgement of Debt cum Guarantee not
binding on 2
nd
defendant
[P-./01/2234 5-./6 .7./041 189 2
0:
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1.>9: ?0-944 .7@99:.]
C.49(4" @929@@9: 1<:
Allied Granite arble !ndustries Sdn "hd #$ %hin &oong 'oldings Sdn "hd
( )rs *2+++, - %L. /1 0refd1
L97/4-.1/<0 @929@@9: 1<:
Contracts Act 1950, ss. 10, 14, 15, 79, 80
2
+UDGMENT
The Pl ai nt i ff had successful l y coml et ed t he const ruct i on of
ei !ht "l oc#s of 4$st orey semi $det ached aart ment s and 10 uni t s of
si n!l e st or ey t er r ace houses for t he %efendant &hi ch &as ai d for
"y t he %efendant e'cet t he sum of ()*14, 474, 00 r et ai ned "y t he
%efendant for r el ease t o t he Pl ai nt i ff onl y aft er t he e'i r y of 12
mont hs aft er t he i ssuance of t he occuat i on er mi t s for t he
aar t ment s and t he t er r ace hous es . The occuat i on er mi t s f or
t he aar t ment s and t er r ace hous es &er e i s s ued on 7. 4. 2005. +y a
,et t er of Ac#no&l ed!ment of %e"t cum -uar ant ee dat ed
21. 12. 200. t he 2
n d
%ef endant , as t he )ana!i n! %i r ect or of t he 1
s t
%ef endant ac#no&l ed!ed t hat t he 1
s t
%ef endant o&ed t he r et ent i on
money t o t he Pl ai nt i f f and i n hi s er sonal caaci t y r omi sed t o
ma#e !ood t he f ul l amount of t he r et ent i on money o&ed t o t he
Pl ai nt i f f i n t he e/ent t hat t he 1
s t
%ef endant coul d not ma#e f ul l
ayment t o t he Pl ai nt i f f "y 20. 1. 2007. 0 n t he e/ent t he 1
s t
%ef endant di d not ma#e t he ayment as a!r eed and t he Pl ai nt i f f
commenced t hi s act i on on 17. 10. 2008. 1o much f or t he Pl ai nt i f f 2 s
l eaded cl ai m.
The t ri al of thi s act i on only concerned t he 2
n d
%efendant
"ecause 3 ud!ment a!ai nst t he 1
s t
%efendant had al r eady "een
o"t ai ned ri or t o t he commencement of t he t r i al .
The 2
nd
%efendant2s leaded defence &as that the ,etter of
Ac#no&l ed!ment of %e"t cum -uar ant ee &as o"t ai ned "y dur ess
and coer ci on and t her efor e /oi d and of no effect &hat soe/er "ut
"efor e det er mi ni n! t hi s asect of t he case, i t i s t r i t e t hat t he
Pl ai nt i f f mus t f i r s t es t a"l i s h i t s cl ai m a!ai ns t t he 2
n d
%ef endant .
*
4ence, the "urden is on the Plaintiff to ro/e that the ,etter of
Ac#no&l ed!ment of %e"t cum -uar ant ee r ender s t he 2
n d
%ef endant
l i a"l e t o ay t he sum r et ai ned "y t he 1
s t
%ef endant &hi ch had not
"een set t l ed "y t he 1
s t
%ef endant .
The sol e &i t ness for t he Pl ai nt i ff &as i t s mana!i n! di r ect or ,
one Tan Ah )ee 5 Tan 1en! ,eon! &hose t est i mony essent i al l y
r ei t er at es t he Pl ai nt i ff2 s l eaded cl ai m i ncl udi n! most i mor t ant l y
t he r oduct i on of t he ,et t er of Ac#no&l ed!ment of %e"t cum
-uar ant ee on &hi ch t he l i a"i l i t y of t he 2
n d
%efendant hi n!es, &hi ch
&as admi t t ed. 6or coml et eness i t i s er has ar or i at e t o
r er oduce t he cont ent s of t he document &hi ch &as admi t t edl y
si !ned "y t he 2
n d
%efendant . 0 t st at es as fol l o&s7
8)9 P:4 1; <0 A=- 0 C7 4.1119$ 1*$ 5079 as mana!i n! di r ect or
of )A1P:4 1%= +4%, i s admi t t ed )A1P:4 1%= +4% &as
o&e TA=- 19=- ,9:=- C:=1T(;CT0 := 1%= +4%
()**0, 000. 00 as a r et ent i on amount .
0 as di r ect or of )A1P:4 1%= +4% r omi s e &i l l ma#e t he f ul l
ayment t o TA=- 19=- ,9:=- C:=1T(;CT0 := 1%= +4%.
0 &i l l t r ans f er my er s onal r oer t y t o ma#e t he t ot al de"t t o
TA= 19=- 9,:=- C:=1T(;CT0 := 1%= +4%>.
1ection 79 of the Contracts Act 1950 defines a contract of
!uarantee as follo&s7
ABC<01@.51 <2 7?.@.01993# B4?@91C3# BD@/05/D.- :9=1<@3# .0:
BC@9:/1<@3
A ?contract of !uarantee2 is a contract to erform the romise, or
di s char !e t he l i a"i l i t y, of a t hi r d er s on i n cas e of hi s def aul t .
The er s on &ho !i /es t he !uar ant ee i s cal l ed t he ? s ur et y2 @ t he
er s on i n r es ect of &hi ch def aul t t he !uar ant ee i s !i /en i s
cal l ed t he ? r i nci al de"t or 2 , and t he er s on t o &hom t he
!uar ant ee i s !i /en i s cal l ed t he ? cr edi t or 2 . A !uar ant ee may "e
ei t her or al or &r i t t en>.
4
0t i s at ent l y cl ear t hat t here i s not hi n! i n t he document t o
su!!est t hat t he 2
n d
%efendant &oul d erfor m or di schar!e t he
l i a"i l i t y of t he 1
s t
%efendant t o t he Pl ai nt i ff i n t he sum of
()*14, 474. 00 i f t he 1
s t
%efendant defaul t s@ i t &as a mere romi se
2 t o t ransf er my persona1 propert y $ $ $ $ 3 a hr ase so i mr eci se as t o
"e caa"l e of many di f f er ent meani n!s. 0 n addi t i on t he al l e!ed
!uar ant ee i s &i t hout consi der at i on "y /i r t ue of 1ect i on 80 and
i l l ust r at i on A cB t her eof of t he Cont r act s Act 1950. They ar e as
f ol l o&s7
AC<04/:9@.1/<0 2<@ 7?.@.0199
Anyt hi n! done, or any romise made, for the "enefit of the rincial
de"tor may "e a sufficient consideration to the surety for!i/in! the
!uarantee.
!LL4S56A5!)7S
AaB C
A"B C
AcB A sells and deli/ers !oods to +. C after&ards, &ithout
consideration, a!rees to ay for them in default of 8. The a!reement
is /oid>.
4ence, t he Pl ai nt i f f has f ai l ed t o es t a"l i s he t he 2
n d
%efendant 2s l i a"i l i t y for t he sum cl ai med and Dui t e aart from t hat 0
al so accet t he 2
n d
%efendant 2 s t est i mony t hat he si !ned t he ,et t er
of Ac#no&l ed!ment of %e"t cum -uar ant ee under dur ess and
coer ci on "ecause t he fi r st ol i ce r eort l od!ed on 19. 1. 2007
A e'hi "i t %*E 1FB and t he 2
n d
ol i ce r eor t l od!ed on 2*. 1. 2007
A e'hi "i t %*E 2FB "ot h essent i al l y al l uded t o t he dur ess and coer ci on
he descr i "ed i n det ai l i n hi s t est i mony and ar e t her efor e
su"st ant i al l y consi st ent &i t h each ot her . 4er e, as t he ,et t er of
Ac#no&l ed!ement of %e"t cum -uar ant ee &as r ocur ed "y
c o e r c i o n , i t s t a n d s t o r e a s o n t h a t i t d o e s n o t " i n d t h e 2
n d
5
%efendant Asee ALL!8D G6A7!58 A6"L8 !7D4S56!8S SD7
"'D #$ %'! 7 &))7G ')LD! 7GS SD7 "'D ( )6S E 2000F 5 C,G
71@ and, 19CT0 :=1 10, 14 and 15 C:=T(ACT1 ACT, 1950B .
0n t he ci rcumst ances and for t he reasons aforesai d t he
Pl ai nt i ff2 s cl ai m a!ai nst t he 2
n d
%efendant i s di smi ssed &i t h cost s
t o "e t a'ed unl ess a!r eed.
D.19: 1. A;-;1T 2010
(LINTON ALBERT# +"
&or the plaintiff - Abang 'alit Abang alik9 :s Loke ;ing Goh (
<artners Ad#ocates
<uchin!
&or the 2
nd
defendant - William Wang9 :s Sia Al#in Wong ( <artners
Ad#ocates
<uchin!
.