Loan agreements with unlicensed moneylenders are unenforceable; statutory compliance is essential for validity, particularly in providing stamped copies to all borrowers.

Introduction

[1] In this case, what is not disputed is the fact that the Appellants had taken a loan from the Respondent. Unfortunately, essential questions such as the exact sum of the loan that the Appellants had applied for, the actual amount of the loan that had been approved by the Respondent and the precise sum of the loan disbursed by the Respondent to the Appellants are unclear. Both the Appellants and Respondent have provided conflicting versions of circumstances surrounding this dispute.

[2] In addition to having to uncover the true factual situations leading to the filing of the original action in the Magistrates Court, both the courts at first instance and here had to grapple with a number of technical and legal issues that had arisen in this dispute. These relate to the application of a number of key provisions of the Moneylenders Act 1951 .

The Overriding Issues

[3] There are two broad issues in this appeal.

[4] The first pertains to the technical issues of law. Under this first broad issue, questions were raised as to:

(a) whether the Respondent/Lender in this appeal was a licensed moneylender;

(b) the legal effect of a moneylending agreement that was not attested in the presence of a Commissioner of Oath; and

(c) whether a copy of the moneylending agreement had been duly stamped and "delivered to the borrower by the moneylender before the money is lent"?.

[5] The second broad issue relates to the actual sum of the loan.

The Parties

[6] The First and Second Appellants, namely, Thamarai a/p Perumal and Raju a/l Dorairaju respectively, were the First and Second Defendants in the Court below. They were the borrowers of the loan. The Appellants are wife and husband.

[7] The Respondent, Arcadia Gold Sdn Bhd, the Plaintiff in the Court of first instance, is a company that is involved in the money lending business.

The Suit And Decision In The Magistrates Court

[8] The endorsement on the Respondent's Writ was for the following claim:

Tuntutan Plaintif terhadap Defendan-Defendan adalah untuk pinjaman tertunggak sejumlah RM92,500.00 di bawah satu perjanjian pinjaman yang diberi oleh Plaintif yang pada masa pemberian pinjaman adalah pemberi pinjam wang berlesen di bawah Akta Pemberi Pinjam Wang 1951 berserta faedah pada kadar 12% setahun dikira atas jumlah tertunggak RM92,500.00 tersebut bermula dari 15 Mac 2017 sehingga tarikh penyelesaian penuh.

Dan RM508.00 (atau sekian banyak wang sebagaimana yang dibenarkan setelah ditetapkan) untuk kos, dan juga, jika plaintif dapat perintah untuk penyampaian ganti, jumlah wang selanjutnya sebanyak RM(atau sekian banyak wang sebagaimana yang dibenarkan setelah ditetapkan).....

[9] The Respondent alleged that the Appellants had borrowed RM100,000 from it and the amounts of RM45,500 and RM54,500 were disbursed to the Appellants through a cheque and in cash respectively and the loan had not been repaid in full.

[10] However, according to the Appellants, they had applied for a RM70,000 loan but the amount approved by the Respondent was only RM50,000. The amount disbursed by the Respondent to the Appellants, as evident from a cheque issued by the Respondent, was only RM45,500. The Appellants alleged that the Respondent "telah memanipulasikan dan memalsukan dokumen-dokumen bagi menunjukkan bahawa jumlah pinjaman adalah sebanyak RM100,000.00".

[11] The learned Magistrate had allowed the claims by the Respondent and concluded as follows:

[23] Berdasarkan keterangan dan dokumen-dokumen yang dikemukakan semasa perbicaraan, Mahkamah atas imbangan kebarangkalian mendapati bahawa Plaintif telah membuktikan tuntutan mereka dan Mahkamah dengan ini memb