Ian H.C. Chin J:

This action concerns the plaintiff and the 2nd defendant. The plaintiff sues the 2nd defendant on a guarantee agreement dated 18 March 1983 ("guarantee") for the sum of RM270,336.20 and interest which sum was the amount still owing by the 1st defendant under a loan agreement cum assignment dated 18 March 1983 ("loan agreement"). At the close of the plaintiff's case, the 2nd defendant elected to submit that the plaintiff had failed to prove its claim. The evidence, including documents admitted by agreement as evidence and facts agreed to in a statement, are these.

The 1st defendant, who was the wife of the 2nd defendant, bought a warehouse from a developer under an agreement dated 14 October 1982. She applied for a loan from the plaintiff and the plaintiff by a letter dated 8 March 1983 (exhibit PB(15)) offered to lend the 1st defendant RM217,000 to help finance the purchase of the said warehouse subject to the condition, inter alia, that the repayment of the loan be guaranteed by the 2nd defendant. Wong Fui Cheng, an officer of the plaintiff, testified that a completed data form relating to the 2nd defendant was received after it was sent to the 1st defendant to enable her to procure the particulars and signature of the 2nd defendant. The 1st and 2nd defendant, according to this witness, signed and accepted the offer. This acceptance note, according to this witness, was later returned to the plaintiff together with the loan agreement and memorandum of charge. This acceptance note was not produced. She testified that it was after the receipt of these documents together with the duly signed guarantee that the plaintiff released the loan. She admitted in cross-examination that she had never met the 2nd defendant and she did not see the 2nd defendant sign the guarantee. Another witness for the plaintiff was an advocate, Ting E. Hang ("PW1"), who testified that he attested the signatures of the 1st defendant to the loan agreement and memorandum of charge. The last witness for the plaintiff was a valuer called Chang Fu Lin and he testified that the price of RM220,000 he recommended for the forced sale of the property which forms the security for the loan was fair and he gave a detailed explanation of how he arrived at that figure. The evidence showed that only the plaintiff had bid for the property at the price of RM220,000 and the plaintiff on 8 April 1991 bought the property at the said price. The present amount claimed by the plaintiff came about as result of an amendment to the statement of claim to take into account, by giving credit to the proceeds of, the sale of the said property and the interest accrued. Mr. David Fung, counsel for the plaintiff, made an unchallenged statement from the Bar that the person who attested the signature of the 2nd defendant to the guarantee had passed away and therefore could not be called as a witness. Reference was made to the loan agreement and the guarantee, which documents I will reproduce when I deal with the submissions of Counsel relating thereto. For the purpose of determining whether the plaintiff had proved its claim on a balance of probabilities, the pleadings will have to be looked into. The relevant part of the amended statement of claim reads:

5. By a letter of guarantee dated 18 March 1983 and for due consideration therein, the 2nd defendant agreed to guarantee the due payment of RM217,000 together with interest, penalties and other payment due to the plaintiffs by the [1st defendant]. 6. Pursuant to the said [loan agreement], chargein-escrow and [guarantee] the plaintiffs have released the said sum of RM217,000 to or for the benefit of the [1st defendant]. 7. [The 1st defendant] defaulted in her payment ... and the plaintiffs through their solicitors, Messrs Alex Pang, Shim & Co., have by a letter dated 11 June 1988 ... demanded repayment... 8. ...On 18 April 1991, the said property was sold to the one and only tenderer for ... RM220,000. 9. Therefore