Augustine Paul JC:

This case which commenced as a claim for money advanced by the plaintiffs to the defendant on an overdraft account climaxed in a deliberation of the admissibility of certain documents under s. 32(1)(b) and s. 73A of the Evidence Act 1950 and the mode of service of a notice of demand in the course of the trial. Both the sections shall hereafter be referred to as "Section 32(1)(b)" and "Section 73A" and the Evidence Act 1950 as "the Act".

The plaintiffs by their writ dated 9 January 1991 instituted proceedings against the defendant for the recovery of a sum of $1,192,484.83 as of 30 November 1990. In substance the case for the plaintiffs is that they had granted a loan to the defendant by way of an overdraft account in the sum of RM500,000. The terms and conditions governing the loan are contained in the Letter of Offer dated 20 March 1984 the material parts of which read as follows:

Re: Application for a secured loan of $500,000.00 on overdraft basis

We are pleased to inform you that your application for a secured loan of $500,000.00 on overdraft basis has been approved subject to the following terms and conditions and those to be incorporated in a formal agreement to be drawn up by our solicitors and our discretion to alter, amend, add or withdraw without notice.

1. Amount approved: $500,000.00.

2. Interest: Adjustable, presently 14.5% per annum on monthly rest.

3. Terms: 1 year.

4. Maturity: 1 year from the date of first drawdown.

5. Processing fee: $6,500.00.

6. Service fee: $50.00 per annum.

7. Compulsory savings: $100.00 per month withdrawal one year after full settlement of all outstandings.

8. Repayment: On Demand. You are to deposit at least $6,500.00 per month into the account to keep interest current and account active.

9. Security: Against registered 1st legal charge on properties held under the following Title Nos:

a) GFS 17064, Lot No. 280, Town Area XVIII Central District, Malacca.

b) SG 16099, Pt Lot No. 190, Mukim of Bukit Baru, Central District, Malacca.

c) HS(D) 5079, Plot No. 9, Town Area XX, Central District, Malacca.

10. Insurance: All buildings are to be adequately insured against fire risk with mortgagee clause in the Bank's favour.

11. Legal and Incidental expenses: All legal charges and expenses including the Bank's solicitor-client cost are to be borne by you.

12. Rent, rates and other charges: Quit rent, assessment and all other charges due to the respective authorities are to be promptly paid by you with copies of receipts forwarded to the Bank.

13. Predisbursement conditions: 1. You are to contribute a minimum of $500.00 towards share capital.

2. Building Contracts on subject site executed between the contractor and you is to be evidenced.

3. Approval for the building plan from the authority is to be submitted.

14. Disbursement conditions: The loan shall be disbursed in the following manner:-

1. Upon completion of legal documentation and subject to solicitors' confirmation that the properties are free from encumbrances.

2. To be made progressively against contractor's bills and subject to an inspection by the Bank Officer.

15. Availability & Drawdown period: The first drawdown for the facility shall be made within 3 months from the date of acceptance of this offer.

16. Capitalisation of Interest: The interest charged is to be serviced monthly. Any non payment of the interest as stipulated shall cause it to be capitalised and added to the principal sum with interest chargeable thereon at the same rate as prescribed above.

17. Default charges: At any one time, the loan outstanding shall not exceed the approved limit. Any excess amount shall be subjected to the default charges at 1a times and above interest rate and shall take effect from the date prescribed on the notice.

18. Other terms and conditions: The registered land owner of properties Nos SG 16099, Pt Lot No. 190, Mukim of Bukit Baru, Central District, Malacca and Title No. HS(D)5079, Plot No. 9, Town Area XX, Centr