by Xavier Kong
PARTNERS of Thomas Philip Advocates and Solicitors, Clinton Tan Kian Seng and Tan Jee Tjun, view the bill for the Temporary Relief for Inability to Perform Contractual Obligations due to Covid-19 (TR Bill), which will be tabled next week by the Singaporean Ministry of Law, as a good measure, and something they hope the Malaysian government will take inspiration from.
“This bill is something to be welcomed. The economic perspective is that there is a lot of uncertainty in the market, and it is virtually impossible for businesses to project cash flow in the next six months. The bill injects stability and certainty in businesses, allowing them to know where they are protected,” Clinton, from the firm’s Civil Litigation and Arbitration departments, tells FocusM.
Jee Tjun, from the firm’s Corporate and Commercial Litigation department, echoes this sentiment, saying the bill will give businesses breathing space and not go under, so they can do their best to revive their situation after pressures from the pandemic have lightened.
Both are of the opinion that Malaysia needs something similar to the bill as well, with Tan Jee Tjun sharing that Malaysia will see more businesses continue to fold up unless the government takes similar measures.
“The moratorium as announced in the Prihatin economic stimulus package is not enough, as businesses are not just about their loans. They have overheads and expenses as well. We need something more, and something along the lines of the TR Bill would be good,” he says.
He adds that the B40 actually need the aid from the moratorium (contrary to what some of the M40 and T20 believe), as they are the most affected by the Movement Control Order (MCO). He also notes that a majority of the B40 are employees of small-to-medium enterprises (SMEs), and protecting the B40 without protecting the SMEs that form their livelihoods would be a short-term measure.
Clinton (left) concurs on this, noting that the six-month moratorium appears to be more of a on-the-surface measure that “is good for businesses on the brink of life and death.”
“This bill goes deeper though, by saying SMEs are protected from legal action. The effects are more far-reaching than what we have, and offer more certainty to businesses,” he said.
However, a concern was also raised over the prohibition of legal suits, and whether or not this infringes on civil liberties.
While both view that, during such a crisis, it can be viewed as a necessary measure, Jee Tjun advocates more stringent measures rather than a blanket ban. Clinton, on the other hand, believes this will function more as a suspension of legal rights, rather than a deprivation of the people’s right to sue, with those legal rights resuming after the pandemic has lessened.
In this, the move to employ a body of assessors is the right move, as the body would act akin to referees to keep things moving by resolving the issues for the time being. Both agree that humans, by nature, will seek loopholes, and that the body of assessors will deny businesses looking to abuse this bill the opportunity to do so.
Another concern raised by Jee Tjun (right) is the need for clarification with regards to the time limit for filing a suit.
“The general timeline is about six years from the date of breach. If it so happens that the time limit is within the next six months, the complainant would be time-barred from pressing the suit. There needs to be a clarification about this limitation, even though only a small percentage will be affected by it,” he said, adding that this would need to be considered in Malaysia too, should a similar measure be put into motion here.
Both also hope that the Malaysian government will see what neighbouring Singapore is doing, and take inspiration from this TR Bill. – April 1, 2020
