UIS 4612- LAW OF INSOLVENCY
Tri 2, 2020/2021
TUTORIAL 2
QUESTION 1
Ms. Nanas, a member of Parliament for Petaling obtained a housing loan of RM300,000 from Bank
Kaya Berhad for the purchase of a condominium.
Ms. Nanas was not able to pay for the balance of the loan from Bank Kaya Berhad amounting to
RM200,000. Bank Kaya Berhad proceeded to initiate a civil suit against Ms. Nanas for the amount
of RM200,000. On 1.3.2013 a judgment in default was obtained against Ms. Nanas to pay Bank
Kaya Berhad the sum of RM200,000 with interest of 5% per annum from the date of judgment
until full and final realisation. There was no application to set aside the judgment in default by
Ms. Nanas. On 4.3.2020, Bank Kaya Berhad came to see you seeking advice on whether the bank
can issue a bankruptcy notice against Ms. Nanas in respect of the judgment in default obtained on
1.3.2013.
(i) Advise Bank Kaya Berhad whether a bankruptcy notice can be issued against Ms. Nanas.
(ii) How will the interest be calculated for the purposes of the bankruptcy notice?
(iii) What is the procedure to issue a bankruptcy notice?
(iv) What is your advice to Bank Kaya Berhad if the total judgment sum by Ms. Nanas is
RM85,000 only?
QUESTION 2 (adopted & modified from CLP July 2008)
On 21.1.2018, Richbank Bhd. (RB) obtained summary judgment against Allen in the Kuala
Lumpur High Court for a sum of RM600,000 together with interest at 8% per annum from the date
of judgment to date of realisation as well as costs of RM1,600. Allen immediately filed an appeal
to the Court of Appeal.
On 12.2.2018, RB filed and served a bankruptcy notice on Allen’s Solicitors. The notice contained
a demand for the judgment sum of RM600,000 together with interest and costs.
On 25.2.2018, Allen filed a summons in chambers supported by affidavit to set aside the
bankruptcy notice on the following grounds:-
(i) the summary judgment is not a final judgment as per s. 3(1) Insolvency Act 1967,
(ii) Uncertainty or ambiguity in the bankruptcy notice since the amount stated to be payable
is not quantified,
(iii) The bankruptcy notice was not served personally on Allen,
(iv) Allen has a counter claim against RB for the sum of RM400,000.
The SAR of the HC dismissed Allen’s application.
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Allen now seeks your advice on the viability of an appeal against the decision of the SAR to the
Judge in Chambers based on the same grounds. Advise Allen.
QUESTION 3 (adopted and modified from CLP 2011)
Steven has just graduated from the University of Pandai. Although Steven was unemployed, he
applied for a credit card from Easy Credit Bank Bhd. (ECBB) which was granted subject to a
guarantee to secure Steven’s credit card payments. Steven’s best friend Jack agreed that his
company Excel Sdn. Bhd. would stand as Steven’s guarantor. To celebrate his graduation, Steven
went on a shopping spree and charged a sum of RM85,000/- on his credit card. He was unable to
make payment on the credit card on the due date and ECBB sued him and entered judgment in
default against him on 10.3.2018.
On 30. 3. 2018 ECBB instituted bankruptcy proceedings against Steven and a Bankruptcy Notice
was issued against him “for the sum of RM85,000/- and interest thereon at the rate of 18% per
annum. Excel Sdn. Bhd. was also sued and Judgment in default was entered against it on 10.3.2018.
Advise Steven and Excel Sdn. Bhd. on the action taken against them.
QUESTION 4
Bank Kaya Berhad had on 2.2.2020 obtained a summary judgment against Mr Zahir, for an
outstanding debt of RM350,000 arising from a housing loan facility which Bank Kaya Berhad had
granted to Mr. Zahir. The summary judgment was for the principle sum of RM350,000 with 2%
interest calculated on the bank’s base rate and cost of RM3,000. Mr Zahir was unsatisfied with the
judgment and had appealed against the summary judgment. To date, the appeal is pending. Bank
Kaya Berhad’s solicitors had proceeded for the court to issue a bankruptcy notice based on the
summary judgment. On 1.3.2020 the bankruptcy notice was served on Mr Zahir which demanded
Mr Zahir “…to pay to Bank Kaya Berhad of No 168, Plaza Bank Kaya, Melaka a sum of
RM350,000, with 2% interest calculated on the bank’s base rate and cost of RM3,000.”
Mr Zahir argues that since his appeal is still pending Bank Kaya Berhad should not have served the
bankruptcy notice on him. He wants to know whether he must comply with the bankruptcy notice.
Advise Mr Zahir.
QUESTION 5 (adopted and modified from Q8 CLP July 2015)
Kucing bought a house for her own stays for RM500,000 and obtained a loan of RM450,000 from
Bank Kaya Berhad and Kucing's mother, Kitty, stood as guarantor for the loan. Kucing also had a
credit card facility with Bank Kaya Berhad.
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Kucing is jobless recently. She became unable to pay Bank Kaya Berhad the balance of the loan
amounting to RM350,000/-. Bank Kaya Berhad then sued Kucing and Kitty and obtained Judgment
In Default against both on 5.1.2020 for the sum of "RM350,000 and interest thereon calculated
from the date of judgment until the date of full realisation."
Meanwhile, Kucing was also unable to pay the credit card balance and Judgment in Default was
then entered by Bank Kaya Berhad on 8.2.2020 for the sum of "RM55,000 and interest thereon
calculated from the date of judgment until the date of full realisation".
Bank Kaya Berhad issued a Bankruptcy Notice dated 10.4.2020 against Kucing demanding for
payment of the sum of "RM350, 000 and interest (hereon calculated from the date of judgment
until the date of full realisation and the sum of RM55,000 and interest thereon from the date of
judgment until the date of realisation.
Bank Kaya Berhad also issued a Bankruptcy Notice dated the same day, 10.4.2020 against Kitty
demanding for payment of the sum of "RM350,000 and interest thereon calculated from the date
of judgment until the date of full realization".
Both Bankruptcy Notices dated 10.4.2020 were served on Kucing and Kitty on 11.6.2020 by
leaving it in their post box.
What is your advice to Kucing and Kitty to oppose the bankruptcy proceedings?
*** End of Document ***
Prepared and edited by Wong Hua Siong & Dr. Gita Radhakrishna.
