The validity of payment demands in hire purchase agreements hinges on proper notice as per statutory requirements, with no evidence of procedural flaws or improprieties in the sale process.

Mohd Nazlan Mohd Ghazali JC:

Introduction

[1] This was an appeal against the decision of the Sessions Court dated 31 July 2015 granting summary judgment in favour of the respondent (the plaintiff at the Sessions Court) for its claim for the payment of an outstanding sum of RM150,307.56 from the appellant. I dismissed the appeal on 10 March 2016. This judgment contains the full reasons for my decision.

Key Background Facts

[2] Pursuant to a Hire Purchase Agreement entered into by the respondent and the appellant dated 24 June 2009 ("the HP Agreement"), the appellant (the defendant in the Court below) agreed to hire one Mercedes Benz S350L-V221 (A) with a registration number of WSH 3131 ("the Car") at a hire purchase price of RM764,025 payable by 107 installments of RM6,019 monthly, which commenced on 24 July 2009, with the last installment being RM5,992.

[3] As the appellant defaulted in making payments, the respondent first sent a Notice of Intention to Re - possess the Car under the Fourth Schedule to the Hire Purchase Act 1967 ("the HP Act") dated 24 April 2014, and subsequently issued another notice dated 10 May 2014 pursuant to Regulation 15 of the Hire-Purchase (Application Of Permit And Procedure Of Repossession) Regulations 2011.

[4] The appellant then however voluntarily returned the Car to the respondent on 6 May 2014, as a result of which the respondent on the following day of 7 May 2014 issued the requisite notice under the Fifth Schedule of the HP Act which provided the respondent's estimate of the value of the Car and the amount that would need to be paid by the appellant to make up for the shortfall and the sum payable should the appellant wish to have the HP Agreement reinstated. The Car was eventually sold by public auction on 22 August 2014 at a sale price of RM141,000.

[5] Given the failure of the appellant to make payment of the outstanding sum of RM150,307.56 owed to and subsequently demanded by the respondent after taking account the proceeds of the sale of the Car, the respondent filed the writ action at the Sessions Court which allowed the summary judgment application by the respondent.Hence this appeal by the appellant.

Summary Of Contentions By Appellant

[6] The appellant raised a number of grounds to support his appeal, as documented in his written submissions. These included the allegation that the appellant was not served with or notified of the order dated 17 June 2011 vesting all assets and liabilities of EON Bank Berhad inclusive of the HP Agreement to the respondent, and that the HP Agreement itself was not given to the appellant. It was also contended that the respondent failed to comply with s 16 of the HP Act and the notices said to have been issued were thus not valid. The appellant further asserted that the respondent did not furnish the estimate value of the Car upon its return to and recovery by the respondent. The principal argument relied on by the appellant in the appeal however, which was also the focus of the hearing of the appeal before me is that the respondent had failed to ensure that the best sale price of the Car was achieved and had instead manipulated the situation by delaying the sale of the same, then eventually effected at a lower and cheaper consideration, without the knowledge of the appellant, thereby causing loss to the appellant.

Nature Of Appellate Function

[7] These same grounds as outlined in the written submissions of the appellant had also substantially already been considered at the Sessions Court, as shown in the grounds of judgment of the