Mohd. Azmi SCJ:

This appeal concerned a claim by Bank Negara Malaysia for liquidated damages in the sum of RM70,000 (Ringgit seventy thousand only) for breach of a scholarship agreement entered into on 21 July 1980 between the bank and the scholar, the 1st respondent with the 2nd and 3rd respondent as guarantors. In an application for summary judgment under O. 14 Rules of the High Court 1980, the Senior Assistant Registrar was satisfied on affidavit evidence that there was no triable issue and accordingly entered judgment against the three respondents on 24 August 1988. On an appeal to a Judge in chambers, the learned Judge set aside the order of the SAR and issued a certificate of no further argument. On further appeal by the bank, we restored the order of the SAR by a majority decision (Gunn Chit Tuan SCJ dissenting).

At the conclusion of the appeal, we indicated that we would give our reasons and we do so now.

From the scholarship agreement, there was no dispute that it was the scholar, the 1st defendant in the Court below who approached the bank for a grant of scholarship to enable him to pursue a course of study in the University of Malaya leading to the award of an H