Jeffrey Tan J:

On 16 June 1995, both defendants were ordered, by a judgment in default of their appearance, to pay the plaintiff the sum of RM608,975.69 and costs. This is the plaintiff's appeal (end. 19), to judge in chambers, against the order of the learned senior assistant registrar, of 13 September 1996, setting aside that judgment in default.

An appeal to a judge in chambers from the decision of a registrar of the High Court is an actual rehearing and the judge treats the matter as though it comes before him for the first time (Tuan Haji Abdul Rahman v. Arab-Malaysian Finance Berhad [1996] 1 CLJ 241 , per Edgar Joseph Jr FCJ; see also Seloga Jaya Sdn. Bhd. v. Pembinaan Keng Ting (Sabah) Sdn. Bhd. [1994] 2 CLJ 716 ); it works out, therefore, that the plaintiff's appeal is, in effect, the defendants' application to set aside the judgment in default of appearance.

A judgment entered in default is not a judgment decided on merits (L Oppenheim & Co v. Mohamed Heneef [1922] 1 AC 482) and is liable, as it does not finally dispose off the rights of the parties, to be set aside (Re: Udos ak Riging; ex parte Seabanc Kredit Sdn. Bhd. [1994] 3 MLJ 383).

As Lord Atkin, in Evans v. Bartlam [1937] AC 473 at 480, observed:

The principle obviously is that unless and until the court has pronounced a judgment upon the merits or by consent, it is to have the power to revoke the expression of its coercive powers where that has been obtained by a failure to follow any of the rules of procedure.

Indeed, O. 13 r. 8 of the Rules of the High Court 1950, which is in pari materia with O. 19 r. 9, provides, "the court may, on such terms as it thinks just, set aside or vary any judgment entered in pursuance of this Order."

"As a general rule, where (a) judgment is irregular ... (it) will be cast aside, as a matter of right (ex debito justitiae)" (see Janab's Key to Civil Procedure in Malaysia and Singapore (2nd edn) p. 314). Where the judgment is regular, "it is axiomatic ... that there must be an affidavit of merits, that is, an affidavit stating facts showing a defence on the merits": Bank Bumiputra Malaysia Berhad v. Majlis Amanah Ra'ayat [1979] 1 MLJ 23, per Raja Azlan Shah (as HRH then was)

It was asserted, in the 2nd defendant's affidavit of 1 December 1995, but not in the submission of learned counsel, that the default judgment was an irregular judgment.

The plaintiff's claim against both defendants was for a liquidated sum. The statement of claim dated 9 September 1993 asserted the following. Sometime in 1986, the plaintiff charged its lands (lots 1065 & 1462 Section 4 North East District, Georgetown) (said lots), at the requests of the defendants, to the Chung Khiaw Bank Limited (chargee bank), as security to the chargee bank for loan facilities of RM500,000 to the 1st defendant. Sometime in 1989, the plaintiffs demanded of the 1st defendant to settle the said loan and to obtain a discharge of the said lots. The defendants requested the plaintiff to withhold all intended proceedings against the 1st defendant for the repayment of all monies due to the chargee bank. By a deed of forbearance and indemnity dated 16 January 1989, the plaintiff agreed to withhold proceedings against the 1st defendant, and the defendants agreed, in consideration of the plaintiff's forbearance, to indemnify the plaintiff "against all loss(es) damage actions claims or demands howsoever arising in the event that the 1st defendant (should) fail to repay all monies due the Chung Khiaw Bank Limited and in consequence thereof the said (lots) (are) foreclosed and forfeited." The 1st defendant failed to repay the said loan, and the chargee bank demanded the sum of RM674,369.35 and the interests accruing thereon from the plaintiff. The interest accruing was calculated at the rate of 4.5% above the base lending rate. The amount outstanding was RM720,000, or thereabout.

There is no statement of defence. However, the 2nd defendant deposed, on behalf of both de