Azmel Maamor J:

This is an appeal against the decision of the Sessions Court judge dismissing the plaintiff's application for a summary judgment under O. 26A of the Subordinate Court Rules 1980.

On 14 January 1986 the appellant/plaintiff had offered one Pala Krishnan Appu Pillai who had accepted the offer a financial facility amounting to RM107,000 for the purchase of a landed property. One of the conditions of the said facility was the furnishing of a guarantor. The respondent had agreed to be the guarantor to the said facility. This is reflected in the guarantee document executed by the respondent dated 25 January 1986. The said property was also charged to the appellant. Because the borrower had committed default in repayment of the said facility the appellant took steps to auction the said property as so provided and allowed under the terms of the offer. However after the sale of the said property there remained an outstanding balance of RM77,753.28.

In accordance with the provisions of the said guarantee document the appellant through their solicitors demanded the outstanding amount from the respondent, the guarantor to the said facility. But the respondent failed to settle the amount. As such the appellant proceeded to bring an action to recover the said sum to court on 13 May 1993. The respondent filed his defence on 20 July 1993. On 20 January 1994 the appellant made an application under O. 26A of the Rules of the Subordinate Courts 1980 for a summary judgment on the ground that the defence had not shown any plausible defence to the plaintiff's claim.

At the hearing before the Sessions Court judge the defendant argued that there were three issues that required full hearing and as such the plaintiff's application should be refused. Firstly, there was undue delay on the part of the plaintiff in filing this application, a period of more than six months from the date the defence was filed. Secondly, in the computation of the interest imposed, the appellant, instead of using yearly rate had used daily rate. Thirdly s. 268(1)(c) of the National Land Code had not been complied in determining the outstanding amount claimed by the plaintiff.

The Sessions Court judge in her judgment had dismissed the first issue on delay because she was quite satisfied with the explanation given by the appellant in respect of the delay in filing the application. The explanation was contained in the supporting affidavit by Lau Kean Huat dated 14 December 1993. The appellant had to wait until the completion of the auction of the said property and receiving of the proceeds of sale of the said property. The learned Sessions Court judge in her grounds of judgment said:

Berkaitan dengan isu kelewatan saya menerima penjelasan yang telah diberikan. Tambahan pula kelewatan tersebut bukan keterlaluan.

I agree with her decision in respect of this first issue.

With regard to the second issue the learned Sessions Court judge in her grounds of judgment said:

Berkaitan dengan isu kiraan faedah saya dapati bahawa berdasarkan Perjanjian Guarantee di Exhibit A kandungan (8), pihak Plaintif sememangnya mempunyai hak untuk mengubah kadar dari 13.5% setahun pada masa Guarantee itu ditandatangani kepada apa-apa kadar mengikut budibicara Plaintif. Namun demikian saya dapati bahawa asas pengiraan tersebut iaitu secara kiraan tahunan. Walaubagaimanapun tuntutan Plaintif dalam Saman dan Penyata Tuntutan adalah pada kiraan harian dan bukan secara kiraan tahunan seperti dalam Gerenti tersebut.

In respect of this second issue the learned Sessions Court judge's judgment had two parts. The first part deals with the right of the appellant to vary interest rate from 13.5% to any other rate at the absolute discretion of the appellant. The right of the appellant to vary interest rate had been agreed upon by the respondent as contained in cl. 1 of the guarantee, which reads:

To pay and satisfy you on demand all every and part of the said Loan and interest prescr