Malayan Banking Berhad v Measurex Engineering: Jurisdiction Dispute under Guarantee Agreement
In Malayan Banking Berhad v Measurex Engineering Pte Ltd and Measurex Corporation Berhad, the High Court of Singapore heard an appeal by Measurex Corporation Berhad (MCB) against the dismissal of its application for a stay of proceedings. Malayan Banking Berhad (MBB) had commenced an action to claim monies due under credit facilities granted to Measurex Engineering Pte Ltd (MEPL) and secured by a guarantee from MCB. The key legal issue was whether a clause in the guarantee agreement conferred exclusive jurisdiction to the Malaysian courts. The court dismissed the appeal, finding that the clause did not confer exclusive jurisdiction and that Singapore had stronger connecting factors.
1. Case Overview
1.1 Court
High Court1.2 Outcome
Appeal Dismissed
1.3 Case Type
Civil
1.4 Judgment Type
Grounds of Decision
1.5 Jurisdiction
Singapore
1.6 Description
The High Court addressed whether a guarantee agreement conferred exclusive jurisdiction to Malaysian courts. The court dismissed the appeal, finding no exclusive jurisdiction and citing Singapore's strong connecting factors.
1.7 Decision Date
2. Parties and Outcomes
| Party Name | Role | Type | Outcome | Outcome Type | Counsels |
|---|---|---|---|---|---|
| Malayan Banking Berhad | Plaintiff, Respondent | Corporation | Appeal Dismissed | Won | Herman Jeremiah |
| Measurex Engineering Pte Ltd | Defendant | Corporation | Not Available | Neutral | |
| Measurex Corporation Berhad | Defendant, Appellant | Corporation | Appeal Dismissed | Lost | Stephen Soh, G B Vasu |
3. Judges
| Judge Name | Title | Delivered Judgment |
|---|---|---|
| Woo Bih Li | Judicial Commissioner | Yes |
4. Counsels
| Counsel Name | Organization |
|---|---|
| Herman Jeremiah | Helen Yeo & Partners |
| Stephen Soh | Arthur Loke Bernard Rada & Lee |
| G B Vasu | Arthur Loke Bernard Rada & Lee |
4. Facts
- Malayan Banking Berhad (MBB) granted credit facilities to Measurex Engineering Pte Ltd (MEPL).
- The facilities were secured by a guarantee from Measurex Corporation Berhad (MCB).
- MBB commenced an action to claim monies due from MEPL and MCB.
- MCB applied to set aside a default judgment and for a stay of proceedings.
- The application to set aside the default judgment was successful, but the stay application was dismissed.
- MCB appealed against the dismissal of its application for a stay of proceedings.
- Clause 24 of the Guarantee stated that it shall be construed and determined under Malaysian law and Malaysian courts shall have jurisdiction.
5. Formal Citations
- Malayan Banking Berhad v Measurex Engineering Pte Ltd and Another, Suit 412/2000/V, RA 84/2000, [2001] SGHC 5
6. Timeline
| Date | Event |
|---|---|
| Guarantee dated | |
| Suit filed (Suit 412/2000/V) | |
| Appeal dismissed |
7. Legal Issues
- Jurisdiction
- Outcome: The court held that the jurisdiction clause in the guarantee did not confer exclusive jurisdiction to the Malaysian courts and dismissed the appeal.
- Category: Jurisdictional
- Sub-Issues:
- Interpretation of jurisdiction clause
- Exclusive jurisdiction
- Forum non conveniens
- Related Cases:
- [1994] 2 All ER 540
- [1970] P.94
8. Remedies Sought
- Monetary Damages
9. Cause of Actions
- Breach of Contract
- Breach of Guarantee
10. Practice Areas
- Commercial Litigation
- Banking Litigation
11. Industries
- Banking
- Engineering
12. Cited Cases
| Case Name | Court | Affirmed | Citation | Jurisdiction | Significance |
|---|---|---|---|---|---|
| Continental Bank NA v Aeokos Cia Naviera SA & others | English courts | Yes | [1994] 2 All ER 540 | England | Cited regarding the interpretation of jurisdiction clauses in loan agreements. |
| The Eleftheria | Not Available | Yes | [1970] P.94 | England | Cited for the principles governing the stay of proceedings based on forum non conveniens. |
| Inter Maritime Management Sdn Bhd v Kai Tai Timber Company Ltd, Hong Kong | Not Available | Yes | [1995] 4 CLJ 164 | Hong Kong | Cited regarding whether a court is obliged to order a stay of action. |
| Malacca Securities Sdn Bhd v Loke Yu | Not Available | Yes | [1999] 6 MLJ 112 | Malaysia | Cited regarding where payment is to be made when a loan is disbursed by a branch. |
| Bank Bumiputra Malaysia Berhad v Melewar Holdings Sdn Bhd & 4 Ors | Not Available | Yes | [1990] 1 CLJ 1246 | Malaysia | Cited regarding where payment is to be made when a loan is disbursed by a branch. |
| Realvest Properties Sdn Bhd v Co-operative Central Bank Ltd (In receivership) | Federal Court (Kuala Lumpur) | Yes | [1996] 2 MLJ 461 | Malaysia | Cited regarding the interpretation of default interest provisions in a contract. |
13. Applicable Rules
| Rule Name |
|---|
| No applicable rules |
14. Applicable Statutes
| Statute Name | Jurisdiction |
|---|---|
| Malaysian Contracts Act of 1950 | Malaysia |
15. Key Terms and Keywords
15.1 Key Terms
- Guarantee
- Jurisdiction clause
- Exclusive jurisdiction
- Forum non conveniens
- Stay of proceedings
- Credit facilities
- Default interest
- Lex fori
15.2 Keywords
- Jurisdiction
- Guarantee
- Banking
- Contract
- Singapore
- Malaysia
16. Subjects
- Civil Procedure
- Contract Law
- Banking Law
17. Areas of Law
- Civil Procedure
- Contract Law
- Banking Law
- Guarantee