Malayan Banking Bhd v Lauw Wisanggeni: Enforcement of Deed of Undertaking & Consideration in Contract Law

In Malayan Banking Bhd v Lauw Wisanggeni, the High Court of Singapore addressed the enforceability of a Deed of Undertaking. Malayan Banking Berhad (MBB) sued Wisanggeni Lauw to enforce a Deed of Undertaking. Lauw argued lack of consideration. The court, presided over by Justice Tan Lee Meng, ordered Lauw to comply with the Deed, finding that MBB's forbearance to sue Kang constituted sufficient consideration, thus the Deed of Undertaking was enforceable.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Judgment for Plaintiff

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

Malayan Banking Bhd sues Lauw Wisanggeni to enforce a Deed of Undertaking. The court ordered Lauw to comply, finding sufficient consideration from the bank.

1.7 Decision Date

2. Parties and Outcomes

Party NameRoleTypeOutcomeOutcome TypeCounsels
Malayan Banking BhdPlaintiffCorporationJudgment for PlaintiffWonSarjit Singh Gill, Pradeep Pillai
Lauw WisanggeniDefendantIndividualClaim DismissedLostTan Lee Cheng, Yeo Yen Ping

3. Judges

Judge NameTitleDelivered Judgment
Tan Lee MengJudgeYes

4. Counsels

Counsel NameOrganization
Sarjit Singh GillShook Lin & Bok
Pradeep PillaiShook Lin & Bok
Tan Lee ChengHarry Elias Partnership
Yeo Yen PingHarry Elias Partnership

4. Facts

  1. MBB granted banking facilities to companies owned or controlled by Kang.
  2. Kang arranged for Lauw to secure banking facilities offered by MBB to his companies.
  3. Lauw entered into a Deed of Undertaking with MBB on 3 July 2002.
  4. E-Infohigh Limited, wholly owned by Lauw, executed a first fixed charge over its shares in United Fiber System Limited in favour of MBB.
  5. The share value of the UFS shares fell below the minimum threshold value.
  6. MBB demanded Lauw furnish additional security, which Lauw failed to do.

5. Formal Citations

  1. Malayan Banking Bhd v Lauw Wisanggeni, OS 329/2003, [2003] SGHC 208

6. Timeline

DateEvent
Deed of Undertaking executed
MBB informed Lauw of share value falling below minimum threshold
Lauw's solicitors replied to MBB
Shortfall rose to $4,200,000
MBB issued a fresh demand to Lauw
Lauw's affidavit filed
Judgment issued

7. Legal Issues

  1. Consideration
    • Outcome: The court held that MBB furnished consideration for Lauw’s Deed of Undertaking by giving more time to Kang to repay his outstanding debts.
    • Category: Substantive
    • Sub-Issues:
      • Forbearance to sue as consideration
      • Consideration moving from promisee to promisor
    • Related Cases:
      • (1864) 2 Dr & Sm 289
  2. Mode of Commencement
    • Outcome: The court held that the originating summons should not be converted to a writ.
    • Category: Procedural

8. Remedies Sought

  1. Order that the defendant comply with the Deed of Undertaking

9. Cause of Actions

  • Breach of Contract

10. Practice Areas

  • Commercial Litigation

11. Industries

  • Banking

12. Cited Cases

Case NameCourtAffirmedCitationJurisdictionSignificance
Alliance Bank Ltd v BroomN/AYes(1864) 2 Dr & Sm 289N/ACited for the principle that forbearance to sue can constitute consideration for a promise.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute NameJurisdiction
No applicable statutes

15. Key Terms and Keywords

15.1 Key Terms

  • Deed of Undertaking
  • Consideration
  • Minimum threshold value
  • Shares
  • Banking facilities
  • Forbearance to sue
  • Originating summons

15.2 Keywords

  • Deed of Undertaking
  • Consideration
  • Contract Law
  • Banking
  • Singapore
  • High Court

16. Subjects

  • Contract Law
  • Banking Law
  • Civil Procedure

17. Areas of Law

  • Contract Law
  • Civil Procedure