PUBLIC BANK BERHAD v KOK KON SANG

Case Significance

Illustrates that technical objections — such as an allegation that the charge is inadmissible for insufficient stamp duty — and bare debt disputes do not amount to 'cause to the contrary' under section 256 of the National Land Code: the chargor having failed to show any legitimate cause, the order for sale was made with costs and a stay refused.

This High Court decision at Shah Alam, delivered by Judicial Commissioner Elaine Yap Chin Gaik, concerns an application for an order for sale of charged property and a chargor's attempts to show cause to the contrary. The plaintiff, Public Bank Berhad, had foreclosed on land charged to it and applied for an order for sale under section 256 of the National Land Code together with Orders 7, 28 and 83 of the Rules of Court 2012. The defendant chargor, who had been declared a vexatious litigant and had not obtained leave to commence further legal proceedings, opposed the application. He disputed the debt, argued that the charge was inadmissible in evidence for insufficient stamp duty, and alleged that the plaintiff had acted in breach of contract.

The court granted the order for sale. It held that a chargor resisting an order for sale must show cause to the contrary — a legitimate reason, rooted in law or equity, why the order should not be made — and that mere disputation of the debt or technical objections will not suffice unless they genuinely undermine the chargee's entitlement. The court considered and rejected the defendant's contentions: the objection to the admissibility of the charge for insufficient stamp duty and the allegations of breach of contract did not amount to a cause to the contrary, and the debt had not been genuinely displaced. Having given the defendant sufficient latitude to show cause and finding that he had failed to show any legitimate cause, the court made the orders sought in the originating summons, with costs of RM5,000, and dismissed the defendant's oral application for a stay of execution. The judgment is a useful illustration of the limited scope of "cause to the contrary" under section 256 of the National Land Code, and that technical objections and bare debt disputes will not defeat a chargee's entitlement to an order for sale.