EXPORT-IMPORT BANK OF MALAYSIA BERHAD v NOBLE ENERGY (M) SDN BHD

wa-24fc-164-01-2025 High Court (Mahkamah Tinggi) 2 September 2025 • WA-24FC-164-01/2025 • 6 min read

Catchwords

Introduction 1. The Plaintiff applied to auction off the properties charged to it by the Defendant in executing a Judgment against IHME LCC (“the Borrower”). The application by way of an Originating Summons was made under section 256 and 257 of the National Land Code (“NLC”) as well as Orders 31, 31A and 83 of the Rules of Court 2012 (“the Rules”). Cause to the contrary 6. A large part of the Defendant’s affidavit is dedicated to putting the Plaintiff to strict poof which in the Court’s view have been satisfied. Part of the rest of the affidavit by the Defendant consists of bare denial. 7. The only cause to the contrary discernable from the affidavit of the Defendant is first, that the charge on the properties of the Defendant being a 3rd party charge was illegal and unenforceable under the law. 8. Secondly the charge was in a nature of a guarantee and therefore any order for sale must be preceded by an application for leave as the Defendant was not a party to the judgment. 9. The only averment in rebuttal to the Plaintiff’s application for order for sale is that the Borrower had satisfied the court judgment which was concealed by the Plaintiff. However, no evidence was adduced to support this rebuttal. 10. In the Court’s view none of the factors above constitute “cause to the contrary”. The provisions in the National Land Code do not prohibit 3rd party charges. A whole chapter is dedicated to charging of land as well as the effect thereof under Part 16 of the National Land Code. 11. The procedure to enforce the charge is also clearly spelled out and in this case the Court is satisfied that the procedure has been complied with. The necessary documents have been properly prepared and served on the Defendant. The Defendant’s contention otherwise is unsubstantiated or supported and is a merely a bare statement to thwart the sale. Conclusion 12. As the Defendant has failed to show any cause to the contrary the Court allows the Plaintiff’s application.

Practice Areas

Civil Procedure Land Law

Judges (1)

Akhtar bin Tahir Delivered

Counsel (4)

Azrul Afifi & Azuan Firm Deidra Sharina & Co. Firm Asmawi bin Ismail Counsel Defendant Nur Fazira Counsel Plaintiff

Parties (2)

EXPORT-IMPORT BANK OF MALAYSIA BERHAD Applicant NOBLE ENERGY Sdn Bhd Respondent

Case Significance

Reaffirms that a third-party security chargor resisting an order for sale under sections 256 and 257 of the National Land Code must establish a genuine legal or evidential obstacle amounting to 'cause to the contrary', and that bare denial will not suffice.

This High Court decision in Kuala Lumpur concerns an application by a bank for an order for sale of several strata properties that had been charged to it, brought to enforce a judgment the bank had obtained against a borrower. The application proceeded by originating summons under sections 256 and 257 of the National Land Code and Orders 31, 31A and 83 of the Rules of Court 2012. Because the chargor was not itself the judgment debtor — the properties secured the debt of a separate borrower — the case squarely raised the question of what amounts to "cause to the contrary", the statutory phrase a chargor must satisfy to resist an order for sale. The chargor advanced three points: that a third-party charge of this kind was illegal and unenforceable; that the charge was in the nature of a guarantee, so that any order for sale had to be preceded by an application for leave since the chargor was not a party to the judgment; and that the borrower had in fact satisfied the underlying judgment, a fact said to have been concealed. The court rejected each. It held that the National Land Code does not prohibit third-party charges — an entire part of the Code, Part 16, is devoted to the charging of land and its effect — and that the prescribed enforcement procedure had been complied with, the necessary documents having been properly prepared and served. The suggestion that the judgment had been satisfied was unsupported by any evidence and treated as a bare assertion advanced to thwart the sale. Finding that the chargor had shown no cause to the contrary, the court allowed the application. The judgment is a compact restatement of the principle that a third-party or security chargor resisting an order for sale must point to a genuine legal or evidential obstacle, not bare denial.

What did the chargor argue amounted to 'cause to the contrary'?

The chargor contended that a third-party charge was illegal and unenforceable, that the charge was in the nature of a guarantee requiring leave before any sale, and that the borrower had already satisfied the underlying judgment. The court rejected all three points.

Why did the court grant the order for sale?

It held that the National Land Code permits third-party charges and that the enforcement procedure had been complied with, while the claim that the judgment was satisfied was unsupported by evidence. As no cause to the contrary was shown, the application was allowed.

Statutes Cited

National Land Code (Cap 828)
Rules of Court 2012

Judgment

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Source: eJudgment (wa-24fc-164-01-2025)