Q: My husband and I purchased a property that was still under construction. To finance the purchase of the property, we entered into a loan agreement with ABC Bank. Under the loan agreement, ABC Bank was obliged to make progressive payments to the property developer on our behalf when the payment became due. However, ABC Bank missed one payment resulting in termination of our Sale and Purchase Agreement (“SPA”) with the developer. My husband and I wanted to claim damages that we have suffered as a result of the termination of the SPA. However ABC Bank relied on an exclusion clause in the loan agreement to absolve any liability against them. Can they do that?

No.

Principle of Right to Freedom of Contract (laissez-faire)

Our Comments

Case in point: CIMB Bank Bhd v Anthony Lawrence Bourke & Anor [2019] 2 MLJ 1. Federal Court (Putrajaya) – Civil Appeal no: 02-105-10 of 2017(W)