Gunn Chit Tuan SCJ:

Consent judgment was recorded in the High Court at Kuala Lumpur against one Datuk Mohd Sari bin Datuk Haji Nuar (hereinafter referred to as "the appellant") on 27 November 1987, for a sum of RM530,000 together with interest thereon at the rate of 8% per annum from 5 June 1986, to the date of realisation and RM350 as costs (p. 43 of the appeal records).

On 27 December 1988, the appellant, by a letter through his solicitors Messrs Lee & Associates, offered to pay the said judgment sum by way of monthly instalments of RM25,000 each commencing on 31 January 1989 (p. 22 of the appeal records). Norwich Winterthur Insurance (M) Sdn. Bhd. (hereinafter referred to as "the respondent"), through its solicitors Messrs Jagjit Singh, accepted the appellant's offer and in fact issued receipts for seven instalment payments thereafter. No terms or conditions were stipulated by either party through their solicitors to provide for the eventuality of a default in the payment of any instalment. The appellant could not pay the instalments for the months of August to December 1989 inclusive for a sum totalling RM125,000. The respondent therefore on 27 March 1990, issued a bankruptcy notice in Bankruptcy No. D2-29-2598 of 1990 demanding payment of the sum of RM505,603.87 being the balance of the amount due on the final judgment obtained by the respondent against the appellant on 27 November 1987 (see p. 13 of the appeal records).

The appellant then applied to set aside the said bankruptcy notice and the application was heard on 29 October 1991, by V.C. George J in the High Court at Kuala Lumpur. The learned Judge adjourned the case to 31 October 1991, and on that day dismissed the appellant's application to set aside the bankruptcy notice with costs.

In his written judgment, the learned Judge stated that "the effect of the understanding arrived at between the parties, as I see it, is that bankruptcy proceedings will not be effected so long as the agreed instalments are paid." His Lordship held that the said bankruptcy notice was properly issued "in that it was in respect of the amount due in terms of the judgment less amounts paid to account".

On appeal to us, learned Counsel for the appellant, Encik Idrus bin Ibrahim, contended that it was not the intention of the parties or the terms of their agreement that if any instalment was not paid, the respondent was at liberty to issue a bankruptcy notice for the balance of the judgment sum. He contended that the learned Judge failed to consider that the respondent could not issue the bankruptcy notice for the balance sum outstanding on 27 March 1990, because it was estopped from denying that it had agreed to allow the appellant to pay the judgment sum by instalments and that there was no "default provision" in their agreement. It was also contended that the learned Judge had erred in implying a term to the parties' agreement that the respondent could issue the said bankruptcy notice for the balance outstanding if the appellant defaulted in the payment of any agreed instalment. Counsel referred to Trollope & Colls Ltd. v. North West Metropolitan Regional Hospital Board [1973] 1 WLR 601, where the Court held that no term can be implied just because, in the light of subsequent events, it may seem reasonable and desirable. The Court also held that no term will be implied unless the Court can say that both parties must have intended it.

With respect to the learned Judge, we cannot find in the correspondence between the solicitors for both parties that there was any term in their agreement that if there was a default in the payment of any instalment, then the judgment creditor was entitled to proceed to issue a bankruptcy notice in respect of the balance due on the judgment debt. In this respect, reference can be made to the local case of Re H. A. Pereira Ex Parte Pagor Singh (bhagat Singh) [1932] The facts of that case are different from those in the present case in that there was a