Jofa Hilmi bin Jaafar & Anor v Abdul Hakam bin Abdul Hadi & Anor

21 Pages·2012·0.11 MB·English

636 MalayanLawJournal [2012]7MLJ
JofaHilmibinJaafar&AnorvAbdulHakambinAbdulHadi A
& Anor
B
HIGHCOURT(KUALALUMPUR)—SUITNOD-22–302OF2009
LEESWEESENGJC
17AUGUST2011
C
Contract — Breach — Obligation to procure — Failure of second defendant to
procurebankguarantee—Secondplaintiff’sagreementtobuydieselfromsupplier
terminated as a result — Whether second plaintiff had cause of action against
seconddefendant—Whetherlossesincurredbysecondplaintiffrecoverable
D
Thefirstplaintiff(‘P1’)wasthefounder-shareholderanddirectorofthesecond
plaintiff(‘P2’),aLabuanoffshorecompany.Thefirstdefendant(‘D1’)wasthe
managing director of the second defendant (‘D2’), which had a licence to
providefinancialservicesandtodomoneylending.P1andD1enteredintoa
E
shareholders and joint ventures agreement (‘SJVA’) under which P2 was
incorporated to engage in international trading in high speed diesel sourced
fromMalaysia.UndertheSJVA,D1wasobligedtosecurebankingfacilitiesfor
P2soastoallowP2toarrangeforeitherabankguaranteeorastandbyletterof
credittobemadeinfavourofP2’ssupplier(‘Ceria’)withwhomP2hadsigned
F
asaleandpurchaseagreement(‘SPA’)tobuyRM15.2mworthofdiesel.P2was
topayforthepurchase,interalia,byproviding,withinsevendaysoftheSPA,
a RM10m bank guarantee issued by P2’s bank to Ceria’s bank as well as a
depositofRM2m.P2,whichhadearlieracceptedD2’sletterofoffertofinance
thepurchase,instructedD2toissuetheRM10mbankguaranteebutD2failed
G
toprovidethesame.D2attemptedtojustifyitsfailurebyinformingP2much
laterthatincompliancewithShariahguidelines,the‘Kafalah’bankguarantee
couldonlybeissuedinfavourofCeriaitselfandnottoitsbank.D2’sdefault
madeitunableforP2tomeetitsfinancialcommitmentstoCeriaresultingin
CeriaterminatingtheSPAandforfeitingtheRM2mdeposit.AlthoughCeria H
didnotsueP2,itclaimedRM3,320,720forlossesanddamagesfromP2ina
letterofdemand.Towardssettlementofthatclaim,P2paidCeriaRM406,960.
With regard to the RM2m deposit which P2 had paid, this amount was
borrowed, with D2’s knowledge, from a Hong Kong company, for which P2
hadpaidRM296,400asfinancingcosts.Meanwhile,P1terminatedtheSJVA I
afternotifyingD1ofhisbreachandgivinghimtimetoremedythesame.P1
thentookovercontrolofP2andalsotookoverthesharesheldbyD1.Inthe
suit, P1’s claim against D1 was for misrepresenting that D2 had financing
facilities with Kuwait Finance House Bhd (KFH) that enabled it to procure
JofaHilmibinJaafar&AnorvAbdulHakambinAbdulHadi
[2012]7MLJ &Anor (LeeSweeSengJC) 637
A KFHtoissuethebankguaranteefortheSPAbetweenP2andCeria.P2’sclaim
againstD2wasforbreachbyD2ofitsletterofoffer.
Held,allowingP2’sclaimanddismissingallotherclaims:
(1) WellbeforeD2’sletterofoffertoP2,P1hademailedtoD1theformatof
B
thebankguaranteeandthestandbyletterofcreditthatwasrequiredby
the supplier.The format of the guarantee was to guarantee payment to
Ceria’sbank(seepara17).
(2) D1wasputtingastrainedandstrangeinterpretationtoD2’sobligation
C toprovidea‘Kafalah’bankguaranteetomeanitwasintendedtoprovide
the guarantee direct to Ceria. Whatever the meaning of ‘Kafalah’ as an
adjective,itcouldnotderogatefromthefactthatitwasabankguarantee
that D2 was to procure for P2. It did not quite matter whether it was
issuedtoCeriaortoitsbanker.Theimportantthingwasithadtobea
D bankguarantee(seeparas19–20).
(3) D2 did not consent to information being released or call relevant
witnesses from KFH to dispel doubts about whether it had, at the
relevantperiod,thecapacitytoprocureKFHtoissuethenecessarybank
guarantee(seepara29).
E
(4) AsP1hadrescindedtheSJVAandtakencontrolofP2andthesharesheld
byD1,therewasnothingelsethatP1couldclaimagainstD1(seepara
35).
F (5) Asthesubstratumofthecontractualrelationshipbetweenthepartieswas
foundedontheletterofofferandrevisedletterofofferbetweenP2and
D2,P2couldmaintainacauseofactionforbreachofcontractagainstD2
(seepara36).
[BahasaMalaysiasummary
G
Plaintifpertama(‘P1’)adalahpengasas-pemegangsahamdanpengarahkepada
plaintif kedua (‘P2’), syarikat luar pesisir Labuan. Defendan pertama (‘D1’)
adalah pengarah pengurusan defendan kedua (‘D2’), yang mempunyai lesen
untukmemberikankhidmatkewangandanuntukmembuatpinjamanwang.
H P1danD1memasukiperjanjianpemegangansahamdanusahasama(‘SJVA’)
dimanaP2digabungkanuntukmenjalankanperdaganganantarabangsadiesel
berkuasa tinggi yang diambil dari Malaysia. Di bawah SJVA, D1
bertanggungjawab untuk mendapatkan kemudahan perbankan untuk P2
untuk membenarkan P2 untuk sama ada mengatur jaminan bank atau surat
I kreditsediauntukdibuatbagipihakpembekalP2(‘Ceria’)yangmanaP2telah
menandatangani perjanjian jual beli (‘SPA’) untuk membeli diesel bernilai
RM15.2 juta. P2 dikehendaki untuk membayar pembelian tersebut, antara
lain,denganmemberikan,dalammasatujuhharidariSPAtersebut,jaminan
bank sebanyak RM10 juta dikeluarkan oleh P2 kepada bank Ceria dan juga
638 MalayanLawJournal [2012]7MLJ
deposit sebanyak RM2 juta. P2, yang mana sebelumnya menerima surat A
tawaran D2 untuk membiayai pembelian tersebut, mengarah D2 untuk
mengeluarkanRM10jutajaminanbanktetapiD2gagaluntukmeberikannya.
D2mencubauntukmenjustifikasikankegagalannyadenganmemberitahuP2
kemudiannyabahawadalammematuhigarispanduanSyariah,jaminanbank
‘Kafalah’ hanya boleh dikeluarkan bagi memihak Ceria dan bukan banknya. B
Keingkaran D2 membuatkan P2 tidak dapat memenuhi komitmen
kewangannya kepada Ceria menyebabkan Ceria menamatkan SPA tersebut
danmerampasdepositRM2jutatersebut.WalaupunCeriatidakmenyaman
P2, ia menuntut RM3,320,720 untuk kerugian dan ganti rugi daripada P2
C
dalam surat tuntutan. P2 membayar Ceria RM406,960 sebagai penyelesaian
tuntutantersebut.BerkaitandepositRM2jutayangdibayarolehP2,jumlah
ini dipinjam, dengan pengetahuan D2, daripada syarikat Hong Kong, yang
manaP2telahmembayarRM296,400sebagaikospembiayaan.Sementaraitu,
P1 menamatkan SJVA selepas memberitahu D1 mengenai kemungkirannya
D
danmemberikandiamasauntukmembayarnya.P1kemudiannyamengambil
alih kawalan P2 dan juga mengambil alih saham-saham yang dipegang oleh
D1. Dalam tindakan, tuntutan P1 terhadap D1 adalah atas sebab
menyalahgambarkan bahawa D2 mempunyai kemudahan kewangan dengan
Kuwait Finance House Bhd (‘KFH’) yang membolehkannya untuk
E
mendapatkanKFHmengeluarkanjaminanbankuntukSPAtersebutdiantara
P2danCeria.TuntutanP2terhadapD2adalahuntukkemungkiranolehD2
mengenaisurattawarannya.
Diputuskan, membenarkan tuntutan P2 dan menolak kesemua tuntutan
F
yanglain:
(1) Sebelum surat tawaran D2 kepada P2, P1 telah menghantar format
jaminan bank dan surat kredit sedia yang dikehendaki oleh pembekal
kepada D1 melalui emel. Format jaminan bank tersebut adalah untuk
menjaminbayarankepadabankCeria(lihatperenggan17). G
(2) D1 meletakkan penekanan dan tafsiran yang ganjil ke atas
tanggungjawab D2 untuk memperuntukkan jaminan bank ‘Kafalah’
ialah bermaksud ia berniat untuk memberikan jaminan terus kepada
Ceria. Apa sahaja maksud ‘Kafalah’ sebagai adjektif, ia tidak dapat
H
menjejaskan daripada fakta bahawa ia adalah jaminan bank yang D2
patutdapatkanuntukP2.Tidakpentingsamaadaiadikeluarkankepada
Ceriaataupengurusbanknya.Yangpentingadalahiamestilahjaminan
bank(lihatperenggan19–20).
(3) D2 tidak bersetuju kepada maklumat yang disiarkan atau memanggil I
saksi-saksi relevan daripada KFH untuk melenyapkan kesangsian
mengenaisamaadaiatelah,padatempohmasarelevan,berupayauntuk
mendapatkanKFHmengeluarkanjaminanbankyangdiperlukan(lihat
perenggan29).
JofaHilmibinJaafar&AnorvAbdulHakambinAbdulHadi
[2012]7MLJ &Anor (LeeSweeSengJC) 639
A (4) Memandangkan P1 telah membatalkan SJVA tersebut dan mengambil
alih P2 dan saham-saham yang dipegang oleh D1, tiada apa lagi yang
bolehditutntutolehP1terhadapD1(lihatperenggan35).
(5) Memandangkan substratum hubungan kontrak antara pihak-pihak
berdasarkan surat tawaran tersebut dan surat tawaran yang disemak
B
semula di antara P2 dan D2, P2 boleh mengekalkan kausa tindakan
untukkemungkirankontrakterhadapD2(lihatperenggan36).]
Notes
C For cases on obligation to procure, see 3(2) Mallal’s Digest (4th Ed, 2011
Reissue)paras3124–3125.
Casesreferredto
AntaoisCompaniaNavieraSAvSalenRederiernaAB[1985]AC191,HL(refd)
D
British Westinghouse Electric and Manufacturing Co, Limited v Underground
ElectricRailwaysCoofLondon,Limited[1912]AC673,HC(refd)
Pacific&OrientInsuranceCoSdnBhdvKathirvelu[1992]1MLJ249;[1992]
1CLJ(Rep)251,SC(refd)
Popular Industries Limited v Eastern Garment Manufacturing Co Sdn Bhd
E
[1989]3MLJ360;[1990]2CLJ(Rep)635,HC(refd)
SimThongRealtySdnBhdvTehKimDar@TeeKim[2003]3MLJ460;[2003]
3CLJ227,CA(refd)
Tan Sri KhooTeck Puat & Anor v Plenitude Holdings Sdn Bhd [1994] 3 MLJ
F 777;[1995]1CLJ15,FC(refd)
Legislationreferredto
BankingandFinancialInstitutionsAct1989Schedule21
CompaniesAct1965Form40B
G IslamicBankingAct1983s34
EvidenceAct1950s34
MohamedHarmyYusoff(HarmyYusoff&Co)fortheplaintiffs.
HariharanTaraSingh(WanShahrizal,Hari&Co)forthedefendants.
H
LeeSweeSengJC:
PROLOGUE
I [1] TheplaintiffsunderstoodaKafalahbankguaranteefacilityprovidedby
the second defendant to the second plaintiff as a bank guarantee issued in
favourofitssupplier’sbanker.Theseconddefendantwhenpressedtoprovide
suchabankguaranteecontendedthatitcouldonlyprovideabankguarantee
direct to the supplier and not in favour of the supplier’s banker. An impasse
640 MalayanLawJournal [2012]7MLJ
resultedwiththesecondplaintiffdeclaringtheseconddefendanttobedefault. A
PARTIES
[2] Thefirstplaintiffisthefoundershareholderanddirectorofthesecond
B
plaintiff, a Labuan offshore company incorporated to trade in high speed
diesel.The first defendant is the managing director of the second defendant.
The second defendant has a license approved by Bank Negara Malaysia to
provide financial services under Schedule 21 of the Banking and Financial
Institutions Act 1989 and has a moneylending license to conduct C
moneylending business. Together the plaintiffs sued the first and second
defendants under a host of various heads of claims for failure to furnish the
bank guarantee at the proper time for the purchase of the high speed diesel.
PROBLEM D
[3] The second defendant (‘D2’) by a letter of offer dated 20 May 2008
offeredthesecondplaintiff(‘P2’)aprojectfinancingforthepurchaseofhigh
speeddiesel.ThefacilitiesconsistedoftheaKafalahbankguaranteeforupto
E
amaximumaggregateamountofRM10mandaMusyarakahBaiAl-Daynfor
uptoamaximumaggregateofRM2m.Theprofitsharingratiobasedonthe
netprofitwas85%toP2and15%toD2.Therewasalsothedirectfinancing
costs of 0.2% per month for the issuance amount for the Kafalah bank
guarantee and 1.35% per month and RM50,000 (for the first drawdown) of F
theMusyarakahBaiAl-Daynfacility.
[4] TheaboveletterofofferdulyacceptedbyP2wassubsequentlyrevisedby
afreshletterofofferfromD2toP2dated28May2008withthedeletionofthe
Musyarakah Bai Al-Dayn facility of RM2m and with that the deletion of the G
securityforthedepositofRM2minfavourofD2.Thisrevisedletterofoffer
wasdulyacceptedbyP2onthesamedate.
[5] ThepurposeoftheKafalahbankguaranteewastoguaranteepaymentfor
H
thepurchaseofhighspeeddieselfromidentifiedPetroleumDevelopmentAct
1974(‘PDA’)holder.
[6] There had earlier been a shareholders’ and joint ventures agreement
(‘SJVA’)dated2May2008executedbetweenthefirstdefendant(D1)andthe I
firstplaintiff(‘P1’)whereP2hadbeenincorporatedasanoffshorecompanyin
Labuan as the vehicle for the joint venture of conducting an international
tradingbusinessofhighspeeddieselwhichshallbesourcedfromMalaysiaand
to be exported regionally beyond Malaysia upon the terms and conditions
JofaHilmibinJaafar&AnorvAbdulHakambinAbdulHadi
[2012]7MLJ &Anor (LeeSweeSengJC) 641
A appearing in the SJVA. Under the SJVA, D1 represented Group A and P1
representedGroupB.TheequityinP2wastobe50%:50%betweenGroupA
andGroupB.
[7] Undercl7.2oftheSJVAitwasprovidedthat:
B
7.2GroupA’sfundingobligationduringtheInitialFundingPeriod
GroupAonitsowneffortandcostsshallobtainfortheCompanyabankingfacility
fromafinancialinstitutionwithin7daysoftheEffectiveDate.GroupAshallalso
toensurethat:
C
-theCompany(P2)shallbeabletoexecuteafinancingagreementwiththefinancial
institutionwithin7daysoftheEffectiveDate.Thefacilityshallbevalidfor3+3
monthsandshallallowtheCompanytoimmediatelyissueanacceptablefinancial
valueofpaymentguaranteeinstrumentinaformofBank
D Guarantee (BG) or Standby Letter of Credit (SBLC), directly to supplier. The
paymentguaranteeinstrumentistoaffecttheSaleandPurchaseAgreementbetween
theCompanyandCeriaBersamaInternationalSdnBhd(CBI).
-theCompanyshallhaveenoughfundingtobeabletopurchasetheinitial5,000
metrictonneofdieselfromthesupplierCeriaBersamaInternationalSdnBhd(CBI)
E within14daysoftheEffectiveDate.
AllcostsofdocumentationandexecutionoftheCompany’sfinancingagreementas
well as the procurement of the initial payment guarantee instrument are to be
providedbyGroupAandshallbeconsideredasShareholder’sadvanceandshallbe
reconciledwithinthree(3)months.
F
GroupB’sFundingObligationduringtheInitialFundingPeriod
GroupBshallprovidefundingforalloftheCompany’sotheroperationcosts.
G
[8] P2 entered into a sale and purchase agreement (‘SPA’) dated 21 May
2008withCeriaBersamaInternationalSdnBhd(‘Ceria’)forthepurchaseof
10,000metrictonsviatwoshipmentsof5,000metrictonsforanagreedprice
ofRM15.2m,FOBSungaiUdangMelaka.Thetermsofpaymentwere,inter
H alia,thatP2shallwithinsevendaysmakeapaymentguaranteeviaaRM10m
bankguaranteeissuedbyanybanksinMalaysiaandalsopaymentofRM2m
cash.Thepaymentguaranteeshallbeissuedbythebuyer’sbanktotheseller’s
bankwithinsevendaysafterthesigningoftheSPA.
I [9] P2 gave draw-down instruction to D2 to issue the Kafalah bank
guarantee of RM10m as per the letter of offer.The bank guarantee was not
forthcominginspiteofextensionsbyCeriaandvariousreminderssentbyP2to
D2.D2contendedthatitsagreementwastofurnishaKafalahbankguarantee
directtothesupplier.
642 MalayanLawJournal [2012]7MLJ
[10] AsthebankguaranteewasnotfurnishedbyD2,P2couldnotmeetits A
financial commitment to pay Ceria with the consequence that Ceria
terminated the SPA and forfeited the RM2m paid. Ceria also claimed for
damagesagainstP2thoughitdidnotsueP2butdidsendaletterofdemand.
All in a further sum of RM406,960 had been paid to Ceria by P2 towards
settlementoftheclaim. B
[11] Meanwhile P1 terminated the SJVA after sending notice of
non-performanceandremedyofD1’sobligationsundercl7.2oftheSJVA.P1
andP2suedD1andD2forlossesarisingoutofbreachoftheSJVAbyD1and
breachoftheletterofofferbyD2. C
PRAYER
[12] The plaintiffs claimed against the defendants in their amended
D
statement of claim under various heads for the various sums paid to third
partiesandforthesumsclaimedbyCeriaagainstP2aswellasforlossofprofits
anddamagestobeassessedtogetherwithinterestandcosts.
PRINCIPLE
E
WhatisthetruenatureoftheKafalahbankguaranteefacilityofRM12mprovided
byD2toP2
[13] Counsel for both the plaintiffs and defendants agreed that the main F
issuetobedecidedbythecourtisthetruenatureoftheKafalahbankguarantee
ofRM12mintheletterofofferandrevisedletterofoffer.
[14] TheletterofofferfromD2toP2dated20May2008atpp41–43of
bundleDisreproducedbelow: G
Al-MusyarakahCapitalSendirianBerhad
OurRef:JI/LO/042/05-08
PrivateandConfidential H
Date:20thMay2008
JEJAKINCORPORATED(Co.No.:LL06316)
U0195,JalanMerdeka
I
87000FT.ofLabuan
Attention:EncikJofaHilmiJaafar
LETTER OF OFFER - PROJECT FINANCING FORTHE PURCHASE OF
HIGHSPEEDDIESEL.
JofaHilmibinJaafar&AnorvAbdulHakambinAbdulHadi
[2012]7MLJ &Anor (LeeSweeSengJC) 643
A
PROJECTFINANCINGFACILITIES:- I)KAFALAHBANKGUARANTEE
II)MUSYARAKAHBAIAL-DAYN
_____________________________________________________________________________________________________
B We are pleased to offer to you the terms and conditions of the abovementioned
Facilitiesassetoutbelow:
Financier: Al-MusyarakahCapitalSdnBhd(“AMCSB”)
Customer: JejakIncorporated(“JejakIncorporated”)
C Facility: i)KafalahBankGuarantee
ii)ii)MusyarakahBaiAl-Dayn
FacilityAmount: UptoamaximumaggregateamountofRM12.0
millionconsistingof:-
i)KafalahBankGuarantee
D
UptoamaximumaggregateamountofRM10.0
million.
ii)MusvarakahBaiAl-Dayn
UptoamaximumaggregateamountofRM2.0million
E
Purpose: i)KafalahBankGuarantee
Toguaranteepaymentforthepurchaseofhighspeed
dieselfromtheidentifiedPDAholder.
ii)MusyarakahBaiAl-Dayn
Tofinancethepurchaseofhighspeeddieselfromthe
F
identifiedPDAholder.
Tenure: i)KafalahBankGuarantee
Revolvingsubjecttoannualreview.
EachKafalahBankGuaranteetobeissuedshallhave
G thevalidityperiodofnotexceeding12monthsfrom
thedateofissuance.
ii)MusyarakahBaiAl-Dayn
Revolvingsubjecttoannualreview.
Maximumof30daysoranyothersuchperiodtobe
H agreeduponbyAMCSB.
Assignmentofpayment: AllpaymentproceedsarisingfromtheProjectshallbe
assignedtoAl-MusyarakahCapitalSdnBhd.
Profitsharing: Basedonthenetprofit*atthefollowingratio:
i)JejakIncorporated-85%
I
ii)AMCSB-15%
*afterdeductionofallrelevantfinancialcostsincurred
byAMCSBinrelationtothefinancingoftheProject
(purchaseofhighspeeddiesel).
644 MalayanLawJournal [2012]7MLJ
A
Directfinancingcosts: i)KafalahBankGuarantee
Fees:0.2%permonthfortheissuanceamount.
ii)MusyarakahBaiAl-Dayn
1.35%permonthandRM50.000(forthefirst
drawdown)ofthefacility.
B
Security(ies): 1)Al-MusyarakahFacilityAgreement
2)DepositamountingtoRM2.0millioninfavourof
AMCSB
3)AssignmentofProceeds
4)Guarantee&Indemnity
C
5)GuaranteeofJofaHilmiJaafar
(NRIC:700213-02-5103)
Thisletterofoffershallbevalidforaperiodofseven(7)daysfromthedatehereof
and shall be made absolute by AMCSB subject to AMCSB having fully satisfied
withalltherelevantdocumentstobesubmittedbyJejakIncorporatedan/orupon D
advicefromAMCSB’ssolicitors.
If you are agreeable to the above terms and condition, please sign this letter and
returnthesametousby27thMay2008orsuchotherextendeddateagreedtobyus,
together with a non-refundable processing fee of RM10,000.00 payable to
‘AL-MUSYARAKAH CAPITAL SDN BHD’. failing which this offer will lapse. E
Notwithstanding your acceptance of our offer, AMCSB reserves the right to
withdrawthisofferwithoutassigninganyreasonthereof.Thankyou
Yoursfaithfully,
Al-MusyarakahCapitalSdn F
sgd
ABDULHAKAMBINABDULHADI
ManagingDirector
G
----------------------------------------------------------------------------------------------------------------------------------------------------
We,JEJAKINCORPORATED(CoNo.:LL06316)herebyaccepttheaboveoffer
uponthestatedtermsandconditions.
sgd
(AuthorisedSignatoriesandCompanyStamp) H
Date:27May2008
[15] Intherevisedletterofofferdated28May2008atpp44–45ofbundle
D the facility amount is ‘Up to a maximum aggregate amount of RM10.0 I
million’.TheMusyarakahBaiAl-Daynfacilityhadbeendeletedintherevised
letterofoffer.
[16] It must be noted that P1 who was PW2 at the trial, as far back as 21
JofaHilmibinJaafar&AnorvAbdulHakambinAbdulHadi
[2012]7MLJ &Anor (LeeSweeSengJC) 645
A February2008hademailedtheformatofthebankguaranteeandthestandby
letter of credit to D1 who was DW1 at the trial. See pp 94–99 of bundle D
(commonbundleofdocuments).Theemailalsostatedthatthebankguarantee
and the standby letter of credit were from the supplier, per-approved and
non-negotiable.Theformatofthebankguaranteewasaguaranteetobeissued
B by an issuing bank to Malayan Banking Bhd as beneficiary, guaranteeing the
paymenttoMalayanBankingBhdinfavourofCeriaofsumreferredtoasthe
‘Guaranteed Sum’ for the purpose of guaranteeing the payment for the
purchaseofhighspeeddiesel.Theotherusualtermsofvalidityperiodandhow
thedemandistobemadebeforetheexpirydatewerealsoprovidedfor.
C
[17] Therewasalsoanotheremailofthesamedateenclosingtheformatof
theSPAbetweenthesupplierandP2aswellasbetweenP2andtheproposed
buyer. See pp 100–119 of bundle D. At p 111 and in cl 7.1 on payment
guaranteeintheformatbetweenthesupplierandP2itisprovidedasfollows:
D
7.1PaymentguaranteeamountforthisAgreementisUSD3,650,000.00andshall
beintheformoftheformofIrrevocableStandbyLetterofCredit(SBLC)orBank
Guarantee(BG),aformatasshowninAppendixC,andconfirmedbytheSeller’s
Bank.
E
[18] AgaintheformatinAppendixCatp119ofbundleDisthesameasthe
earlierformatreferredtoatpp95–96ofbundleD.
F [19] DW1 who is also D1 is now putting a strained and strange
interpretationtotheobligationofD2toprovideaKafalahbankguaranteeto
meanthatitwasintendedtoprovidethebankguaranteedirecttothesupplier.
Attheendoftheday,asbusinessman,theintentionisclearandpracticaland
the meaning placed on the word ‘bank guarantee’ cannot derogate from its
G ordinary and natural meaning. Whatever is the meaning of ‘Kafalah’ as an
adjective,itcannotderogatefromthefactthatitisabankguaranteethatD2is
to procure for P2. DW1 testified that D2 is a company that has a license
approved by Bank Negara Malaysia to provide financial services under
Schedule21oftheBankingandFinancialInstitutionsAct1989andthatithas
H amoneylendinglicenseandisauthorisedtodomoneylendingbusiness.
[20] TheinterpretationofDW1isskewedonthesemanticsofthemeaning
of a ‘Kafalah bank guarantee’. No evidence has been led on the meaning of
‘Kafalah’.Whateveritisitcannotmeansomethinglessthanabankguarantee.
I TheevidenceofPW2wasthattherepresentationmadetohimbyDW1was
that D2 had existing facilities with Kuwait Finance House Bhd (‘KFH’) and
would procure the ‘Kafalah bank guarantee’ to be issued. It does not quite
matterwhetheritisissuedtothesupplierortothesupplier’sbanker,Maybank.
Theimportantthingisitmustbeabankguarantee.Aswasbrilliantlyexpressed