Buttrose J:

In this action the plaintiff, who described himself as an ex-moneylender, claims against the defendants for the sum of $6,776.19, being the balance of principal and interest due under two promissory notes for $2,200 dated 29 August 1957 and $3,750 dated 28 March 1958, respectively and made by the defendants jointly and severally in favour of the plaintiff.

The plaintiff's case was that the amounts stated in the promissory notes were actually lent and that in respect of the first promissory note $1,200 had been paid off the principal and $340 off the interest, while on the second promissory note only a sum of $1,250 had been paid off the interest.

The defendants' case was that only $1,000 was lent in respect of the first promissory note and that the plaintiff agreed to accept either a lump sum repayment of $1,500 or repayment by seven instalments of $300 per month including both principal and interest in each case. They maintained that they had paid the plaintiff in full on the instalment basis. With regard to the second promissory note the defendants alleged that only $500 was lent and at the time the loan was made the plaintiff informed them that only the interest in respect of the first loan had been paid and that together with the second loan of $500 the principal that would then be due would be $2,000. The defendants say that the plaintiff agreed to accept a lump sum repayment of $2,000 or repayment by fifteen instalments of $250 a month to include both principal and interest in each case. They maintained that they had paid the plaintiff in full on the instalment basis in respect of this loan also.

The defendants pleaded fraud and alleged that the promissory notes themselves did not correctly set out either the agreements reached, the amounts of the loans or the interest payable. They denied that copies of the promissory notes authenticated by the plaintiff were delivered to them before the money was lent or at all. They further denied that the plaintiff had ceased to be a moneylender and maintained that he was at all material times and still is a moneylender. The defendants rely on s. 15 of the Moneylenders Ordinance, 1959 (No. 58 of 1959), hereinafter referred to as 'the new Ordinance', in that the plaintiff, being a moneylender, is not registered under the new Ordinance and therefore the claim is unenforceable. They also rely on ss. 22 and 23 of the new Ordinance and say that the interest charged in respect of the sums actually lent is excessive and the transaction is harsh and unconscionable and substantially unfair and that such excess of interest be repaid to them. The defendants counterclaim that an account be taken and that the plaintiff repay to them such excess of interest.

The position was that the plaintiff was a moneylender under the Moneylenders Ordinance (Ch. 193), hereinafter referred to as 'the old Ordinance', which was repealed by the new Ordinance which came into operation on 11 September 1959. The present proceedings were commenced on 4 September 1959, one week prior to the new Ordinance coming into force. Not only therefore were the loans in question in the present suit made before the coming into operation of the new Ordinance but the cause of action had already arisen and proceedings had been taken.

The plaintiff maintained that he had ceased to be a moneylender as from 10 September 1959, but had merely endeavoured to collect outstanding accounts after that date and had not entered into any new agreements for loans to borrowers.

The defendants contended, on the other hand, that notwithstanding that the plaintiff had not lent any money after the coming into force of the new Ordinance by continuing to collect his outstanding accounts on and after 11 September 1959, he was carrying on the business of a moneylender and the provisions of the new Ordinance apply to him. In other words, that he could not seek to recover his money without taking out a licence.

In Pandey v. Stephen