Bank Kerjasama Rakyat Malaysia Bhd v Emcee Corporation

 

[2003] 1 CLJ 625    

PDF


BANK KERJASAMA RAKYAT MALAYSIA BHD v. EMCEE CORPORATION SDN BHD
COURT OF APPEAL, KUALA LUMPUR
ABDUL HAMID MOHAMAD JCA, RICHARD MALANJUM JCA, ARIFIN ZAKARIA JCA
[CIVIL APPEAL NO: N-02-421-1999]
29 JANUARY 2003

BANKING:Charge – Order for sale – Loan facility granted under Islamic banking principle – Whether bank could enforce charge upon default in loan repayments – Whether remedy available under National Land Code and Rules of the High Court 1980

LAND LAW:Charge – Order for sale – Cause to the contrary – Whether established – Whether trial judge rightfully dismissed application for order for sale

The appellant had granted the respondent a loan facility of RM20 million under the Islamic banking principle of Al-Bai Bithaman Ajil. The respondent defaulted in the loan repayments and the appellant issued a Form 16D notice under the National Land Code. The respondent failed to comply with the notice and the appellant sought for an order for sale of the security charged under the loan facility. The High Court dismissed the application on the fact that the appellant had breached its agreement with the respondent to release an initial sum of RM5 million to the respondent. The appellant appealed to this court. The main issue was whether there was a failure by the appellant to release the amount of RM5 million to the respondent based on the agreements made between the parties so as to establish a “cause to the contrary” under s. 256(3) NLC to refuse an order for sale.

Held:

Per Abdul Hamid Mohamad JCA

[1] The facility given by the appellant to the respondent was an Islamic banking facility. But that did not mean that the law applicable in this application was different from the law applicable if the facility was given under conventional banking. The charge was a charge under the National Land Code. The remedy available and sought was a remedy provided by the National Land Code. The procedure is provided by the Code and by the Rules of the High Court 1980. The court adjudicating it was the High Court. Therefore, the same law was applicable, the same order that would be, if made, and the same principles that should be applied in deciding the application. (p 629 f)

[2] The applicable law was s. 256 NLC. The leading case on the subject was Low Lee Lian v. Ban Hin Lee Bank Bhdand the issue was whether the alleged breach of contract by the appellant fell under one of the three categories of cases mentioned therein to establish “cause to the contrary” under s. 256(3). (pp 629 g-h & 630 a-h)

[3] It was clear from the agreements made between the parties that the first instalment should be paid after the appellant released the facility to the Marginal Deposit Account. There was no dispute that the appellant had released RM4,345,831.05. Nowhere in the agreements was it provided that the first instalment would become due after RM5 million was released. Neither was the amount of first release mentioned or the phrase “first release” defined. That the instalment period began to run upon the first release being made was quite reasonable and it was beyond any doubt that there was a first release or releases. The instalments became payable and were paid partly. In the circumstances, the demand by the appellant could not be said to be premature. (pp 632 g-h & 633 a-b)

[4] The validity of the charge was not in issue. The statutory procedural requirements had been complied with. There was nothing that brought the application within the three categories of cause to the contrary established in Low Lee Lianto warrant the refusal of the order for sale. (p 633 d)

[Appeal allowed with costs; deposit to be refunded to the appellant.]

[Bahasa Malaysia Translation Of Headnotes

Perayu bank telah memberikan responden satu kemudahan pinjaman wang RM20 juta di bawah prinsip urusan bank Islam Al-Bai Bithaman Ajil. Responden memungkiri perjanjian berkenaan pembayaran ansuran pinjaman tersebut dan justerunya perayu mengeluarkan satu notis Borang 16D di bawah Kanun Tanah Negara (‘KTN’) terhadap responden. Responden gagal menepati notis tersebut dan perayu seterusnya memohon untuk satu perintah jualan sekuriti yang digadaikan di bawah kemudahan pinjaman wang tersebut. Mahkamah Tinggi menolak permohonan itu atas alasan bahawa perayu telah memungkiri perjanjian dengan responden untuk melepaskan jumlah wang (‘pelepasan pertama’) sebanyak RM5 juta terdahulu kepada responden seperti yang dijanjikan. Maka, rayuan perayu ini. Isu utama ialah sama ada perayu memang gagal untuk melepaskan jumlah wang sebanyak RM5 juta kepada responden berdasarkan perjanjian-perjanjian yang dibuat di antara mereka dan sama ada ianya merupakan satu “cause to the contrary”, iaitu, sebab-sebab sebaliknya bagi menolak permohonan perayu untuk perintah jualan di bawah s. 256(3) KTN.

Diputuskan:

Oleh Abdul Hamid Mohamad HMR

[1] Kemudahan yang diberikan oleh perayu kepada responden adalah satu kemudahan di bawah urusan bank Islam. Tetapi ini tidak bermakna bahawa undang-undang yang terpakai dalam permohonan ini berbeza daripada undang-undang yang terpakai jika kemudahan tersebut telah diberikan di bawah urusan bank biasa. Gadaian tersebut adalah satu gadaian di bawah KTN. Remedi yang tersedia dan yang dipohon ditetapkan di bawah KTN. Prosedur yang patut diikuti ditetapkan di bawah KTN dan Kaedah-kaedah Mahkamah Tinggi 1980. Mahkamah yang membicarakannya adalah Mahkamah Tinggi. Dengan itu, undang-undang sama terpakai, perintah sama yang akan dibuat dan prinsip-prinsip sama patut terpakai dalam memutuskan permohonan tersebut.

[2] Undang-undang terpakai adalah s. 256 KTN. Kes penting berkenaannya adalah Low Lee Lian v. Ban Hin Lee Bank Bhddan isunya adalah sama ada mungkir kontrak perayu jatuh di bawah salah satu kategori kes-kes yang dibentangkan dalam kes tersebut untuk merupakan satu “cause to the contrary” di bawah s. 256(3).

[3] Adalah jelas daripada perjanjian-perjanjian di antara perayu dengan responden bahawa ansuran pertama patut dibayar oleh responden selepas perayu melepaskan kemudahan tersebut ke akaun deposit margin. Tidak dipertikaikan bahawa perayu telah pun melepaskan RM4,345,831.05. Tiada apa pun dalam perjanjian-perjanjian yang menetapkan bahawa ansuran pertama patut dibayar hanya selepas RM5 juta dilepaskan. Juga amaun untuk dilepaskan tidak disebutkan dan tiadanya definasi frasa “first release”. Bahawa masa untuk membuat pembayaran ansuran mula berjalan selepas amaun pertama dilepaskan adalah wajar dan tidak diragui bahawa terdapatnya pelepasan pertama atau pelepasan-pelepasan wang. Ansuran-ansuran pembayaran sepatutnya dibuat dan telah pun dibayar sebahagiannya. Dalam keadaan ini, tuntutan perayu tidak boleh dikatakan pramasa.

[4] Keesahan gadaian tersebut bukanlah satu isu. Keperluan prosedur statutori telah dipatuhi. Tiada apapun yang membawa permohonan untuk perintah jualan tersebut di bawah salah satu kategori kes-kes “cause to the contrary” yang dibentangkan oleh Low Lee Lianuntuk menolak permohonan untuk perintah jualan.

Rayuan dibenarkan dengan kos; deposit dikembalikan kepada perayu.]

Cases referred to:

Low Lee Lian v. Ban Hin Lee Bank Bhd [1997] 2 CLJ 36 FC (refd)

Legislation referred to:

National Land Code, s. 256(1)

Counsel:

For the appellant – Arshad Ismail (Lucy Tan); M/s Mohamed Ismail & Co

For the respondent – Kevin Danker (Peter Skelchy); M/s Danker & Co

Reported by Usha Thiagarajah

This entry was posted in Islamic Banking, Referred in Azhar Osman's case and tagged . Bookmark the permalink.