Hashim Yeop A Sani CJ (Malaya):

[1] The appellant as plaintiff went before the learned judge of the High Court on an application under O 14 of the Rules of the High 1980 for summary judgment for the amount endorsed in the writ, to wit $2,950,000 and interest at the rate of 14% pa on the sum claimed until judgment and thereafter at the rate of 8% pa until satisfaction.

[2] The appellant's claim was grounded on a deed dated 3 April 1985 between the appellant and the first and second respondent companies and an agreement in writing also dated 3 April 1985 executed by the third, fourth and fifth respondents being directors of the first and second respondent companies. In the deed it is stated that in consideration of the appellant agreeing, inter alia, to forbear from further prosecuting certain civil actions and to discontinue the same, the first and second respondent companies jointly and severally agreed to pay to the appellant the sum of $3,000,000. In the agreement it is stated that the third, fourth and fifth respondents jointly and severally guaranteed the observance and performance of the terms and conditions of the deed referred to earlier.

[3] It is not disputed that the appellant pursuant to the agreement did forbear further to prosecute the said civil actions and in fact on 15 April 1985 discontinued the same. After executing the said instruments the third respondent gave to the appellant a cash cheque for $50,000 and another cheque for $200,000 with a request to the appellant that the latter should not present the second cheque for payment until 29 April 1985. The appellant agreed to the request. The cash cheque for $50,000 was honoured but the second cheque for $200,000 was returned dishonoured when presented for payment on the agreed date. Subsequently on 22 July 1985 the appellant through his solicitors gave notice to all the respondents and demanded the balance sum of $2,950,000.

[4] In their statement of defence the third, fourth and fifth respondents denied they were unqualified guarantors and averred that the guarantee given was subject to a full and honest disclosure of the audited accounts expended by the appellant and that they had declined to pay the balance after having discovered that the appellant had fraudulently misrepresented on the actual amount expended on the timber concession which was the subject matter of the civil actions referred to earlier.

[5] The learned judge in the High Court held that this was an arguable case and the respondents had raised triable issues in their defence and accordingly dismissed the application for summary judgment.

[6] The approach to be taken by an appellate Court in an O 14 appeal has been settled. The appeal Court should not regard the appeal as reviewing the exercise of the judge's discretion but should approach the appeal as a rehearing. This principle was reiterated in Malayan Insurance (M) Sdn Bhd v. Asia Hotel Sdn Bhd, [1987] 2 MLJ 183; [1987] CLJ 182 which referred to National Company for Foreign Trade v. Kayu Raya Sdn Bhd; [1984] 2 MLJ 300; [1984] 1 CLJ 283 following European Asian Bank v. Punjab and Sind Bank [1983] 2 All ER 508 at p 516 [1983] 1 WLR 642.

[8] In the instant case it should be observed at once that the claim is based on two written i