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2024 MarsdenLR 2315
HIGH COURT MALAYA KUALA LUMPUR
BALVINDER SINGH SANTOKH SINGH – Appellant
Versus
HENRY ELIATHAMBY – Respondent
[Civil Appeal No: WA-12BNCC-28-11/2019]
The court affirmed that an informal loan based on trust between friends is valid, and without evidence to the contrary, the repayment claim stands.
Headnote:(A) Evidence Act - Section 58 - Loan agreement - Plaintiff's claim for repayment of RM160,000 loan dismissed by Sessions Court - Court found close friendship and trust between parties led to informal loan without written agreement - Defendant's defense of loan being repayment for Guarantee Agreement rejected due to lack of evidence - (Paras 10, 11, 28, 61)
(B) Appellate intervention - Appellate Court will not interfere unless trial court's decision is plainly wrong - No grounds for appellate intervention found in this case. (Paras 13, 15, 61)
Facts of the case:
The Plaintiff lent RM160,000 to the Defendant based on a mutual understanding without formal documentation, leading to a legal dispute when repayment was demanded. (Paras 6, 10)
Findings of Court:
The Sessions Court found the Plaintiff's claim valid based on the close relationship and trust between the parties, rejecting the Defendant's claims regarding the nature of the loan. (Paras 10, 11)
Issues: The core issue was whether the RM160,000 was a loan or repayment under a Guarantee Agreement. (Paras 18, 21)
Ratio Decidendi: The court ruled that the lack of evidence for the Defendant's claims and the established relationship warranted the conclusion that the sum was a loan, not a repayment obligation. (Paras 28, 39)
Result: The Defendant's appeal was dismissed with costs.
JUDGMENT
Introduction
[1] This appeal originates from the Sessions Court .
[2] In the Sessions Court the respondent's claim against the appellant for repayment of a loan was allowed.
[3] The appellant appealed.
[4] After considering the Rekod Rayuan and the parties' submission this Court dismissed the appellant's appeal. The grounds for the said dismissal is set out below.
[5] The parties will be referred to as they are in the Sessions Court ("SC").
Parties' Pleaded Case
[6] The Plaintiff's pleaded case may be summarised as follows-
(a) the Plaintiff and Defendant are close friends "merupakan sahabat serta rakan sekerja yang mempunyai hubungan yang erat" and both are directors in a company known as Tootpay Sdn Bhd ("Tootpay SB");
(b) both of them frequently borrowed money from each other without any written agreement and the understanding between them was that repayment of the loan will be made when the borrower is financially able to do so;
(c) at the request of the Defendant, the Plaintiff had given out loan to the Defendant over a span of period between August 2012 to November 2013;
(d) total sum of the loan was RM160,000.00 ("RM160,000.00 Loan") paid to the Defendant by way of cheques in different amounts and on different dates, details of which is pleaded in paragraph 9 of the Plaintiff's Statement of Claim ("SoC");
(e) Plaintiff is not a moneylender but had voluntarily gave out the RM160,000.00 Loan -
(i) without any written agreement;
(ii) without imposing any interest; and
(iii) on the basis of the Defendant's assurance to repay the RM160,000.00 Loan after the Defendant receive his return from his investment.
(f) due to the financial constraint faced by the Plaintiff as a result of being removed from Tootpay SB, the Plaintiff demanded repayment of the RM160,000.00 Loan from the Defendant. Plaintiff had given ample time to the Defendant to repay the said loan but Defendant failed to do so. Eventually by way of a letter dated 21 September 2018 from the Plaintiff's solicitor an official demand was made for the repayment of the RM160,000.00 Loan;
(g) the Defendant failed to heed the said demand;
(h) by way of the Writ and SoC, the Plaintiff claims for the following reliefs at para 13 of the SoC -
13. (a) Defendan membayar wang sebanyak RM160,000.00 yang telah dipinjam secara pinjaman persahabatan "Friendly Loan" kepada Plaintif.
(b) Faedah keatas RM160,000.00 sebanyak 5% setahun dari tarikh pemfailan writ ini sehingga penyelesian penuh,
(c) Kos tindakan ini,
(d) Lain-lain perintah yang difikirkan patut dan munasabah oleh Mahkamah Yang Mulia Ini.
(i) the payment of RM160,000.00 as pleaded in para 9 of the SoC has nothing to do with the loan of RM800,000.00 given by the Defendant to a common friend one William Pu Say Chiang ("William Pu"). In consideration of the sum RM800,000.00 loaned to William Pu ("PSY Loan") the Plaintiff executed a Guarantee and Indemnity Agreement dated 1 October 2019 ("Guarantee Agreement") where the Plaintiff undertake to guarantee the repayment of the RM800,000.00.
[7] The Defendant's defence may be summarised as follows -
(a) Defendant denies having knowledge of the Plaintiff;
(b) Defendant denies Plaintiff's claim that they have a close relationship;
(c) Defendant and Plaintiff were colleagues and directors in Tootpay SB;
(d) the Defendant has never, at any point in time, requested for any loan from the Plaintiff. In particular, the Defendant denies he had requested for the RM160,000.00 Loan and that the Plaintiff had lend to him the RM160,000.00 Loan on the terms pleaded by the Plaintiff;
(e) at the request of the Plaintiff, the Defendant agreed to give the PSY Loan. Defendant does not know William Pu well;
(f) the sum RM160,000.00 as detailed out by the Plaintiff in para 9 of the SoC is in respect of the Plaintiff's obligation under the Guarantee Agreement (Exhibit P-4) where the Plaintiff agreed to guarantee and indemnify the Defendant in respect of the PSY Loan; and
(g) the Plaintiff's claim is witho
