in the court of appeal malaysia (appellate jurisdiction)

Let us now turn to the issues:
(1) RM3.78 million loan and interest charged
The advance of RM3.78 million to the 1 st respondent from the Ngiu
Kee Group was first raised at the Directors Meeting which took place on
18.6.2003. It was explained at that meeting that the advance was necessary
in order to repay the suppliers. The suppliers had indicated that supply of
the goods ordered by the 1 st respondent would be stopped if no payment was
made. The respondents claimed that they did thus in accordance with clause
4.4.2 of the JV Agreement which provides:
“Any additional finance required by the Company may be
advanced by the parties subject to the prevailing banking
interest rate for overdraft facilities/term loan facilities to be
agreed between the Shareholders.”
We take note that when this advance was made, the 1 st respondent was
facing financial difficulties because the bank threatened to reduce the
overdrafts and subsequently to withdraw all the financial facilities. The
bank also required the 1 st respondent to give additional security. As we have
said earlier, the 2 nd respondent was agreeable to give the additional security
but not the petitioner despite the fact that the 2 nd respondent was willing to
indemnify the petitioner in respect of the petitioner’s share of additional
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