(delivering the Judgment of the Court): We allowed the appeal with costs here and below to be taxed, set aside the Judgment in default of defence and ordered both the appellants to deliver their statement of defence within twenty-one days from date thereof. We intimated that we would give our reasons in writing which we now do.

The relevant facts for the purpose of this appeal may be briefly stated. The respondents are a licensed bank carrying on business in Malaysia and on December 31, 1983 they took out a writ against both the 1st and 2nd appellants. According to the statement of claim dated January 6, 1984 the respondents claim from the appellants the following reliefs:

(1) A declaration that the first Defendants received the sum of S$1,500,000 as money had and received to the use of the Plaintiffs and an order that the first Defendants repay the amount to the Plaintiff.

(2) A declaration that the second Defendant received the sum of S$4,696,500 as money had and received to the use of the Plaintiffs and an order that the second Defendant repay the amount to the Plaintiffs.

(3) Damages for deceit and/or conspiracy and/or conversion of moneys.

(4) Interest.

(5) Such further or other remedy as the Court may deem just and proper.

The appellants entered a conditional appearance and applied to strike out both the writ and the statement of claim. This was dismissed on June 4, 1984 and notice of appeal was filed on June 29, 1984. But on June 22, 1984 the respondents without obtaining leave of the Court or a Judge, entered a Judgment in default of defence in the undermentioned terms:

"No defence having been served by the Defendants herein, IT IS THIS DAY ADJUDGED that the First Defendant do pay the Plaintiffs the sum of S$1,500,000.00 and the Second Defendant do pay the Plaintiffs the sum of S$4,696,500.00 respectively with interest AND IT IS THIS DAY FURTHER ADJUDGED that the Defendants do pay the Plaintiffs damages for deceit and/or conspiracy and/or conversion of moneys to be assessed and costs $240.00.

On August 3, 1984 application was made by the appellants to set aside the default judgment. This was refused by the learned judge with costs who then granted a certificate that he required no further argument pursuant to section 68(2) of the Courts of Judicature Act 1964. Hence this appeal.

Now, Order 19 rule 9 of the rules of the High Court 1980 gives a discretionary power to the judge in chambers to set aside a default judgment. This discretion is in terms unconditional. The Courts, however, have laid down for themselves rules to guide them in the normal exercise of their discretion. One is that where the judgment was obtained regularly there must be an affidavit of merits, meaning that the applicant must produce to the Court evidence that he has a prima facie defence [per Lord Atkin in Evans v Bartlam [1937] AC 473, 479–480.]

In Anlaby & Ors v Praetorius (1888) 20 QBD 764 it was held that where a plaintiff has obtained judgment irregularly, the defendant is entitled ex debito justitiae to have such judgment set aside. This case was considered by the Privy Council in MacFoy v United Affica Co Ltd [1962] AC 152 and by the Court of Appeal in White v Weston [1968] 2 WLR 1459; [1968] 2 All ER 842. We would adopt this guideline in exercising the discretion contained in Order 19 rule 9. To quote Lord Guest in Ratnam v Cumarasamy & Anor [1965] 1 MLJ 228, 229. "The Rules of Court must prima facie be obeyed." A fortiori, when the rules regulate how a default judgment may be obtained or given. There are good grounds why that should be so, because the entry of judgment is a serious matter, leading to the issue of execution and possibly bankruptcy proceedings.

In our opinion, Judgment in default of defence may be entered by the plaintiff either by way of final or interlocutory judgment in the following circumstances viz. when the claim of the plaintiff consists of:

(a) Order 19 rule 2 (liquidated demand);

(b) Order 19 rule 3 (unliq