Wan Yahya J:

In this case the plaintiff's claim against the defendant is for the sum of $34,790 and interest in respect of what he calls a 'friendly loan'. In the particulars set out in his statement of claim he itemised nine transactions on varying dates on which he claimed various sums of money were loaned to the defendant. In the course of his evidence in chief, however, he conceded that two of the items - one for $600 and the other for $690 - were in fact payments towards interest.

The system of these loan transactions, as related by the plaintiff himself, is as follows. Whenever a loan is requested for and granted, the defendant or his fiancee would make out a cheque for the amount loaned plus a sum representing one month's interest at 3% per mensem as evidence of loan and probably for what it is worth, a collateral. These cheques were either drawn on the account of a transport company of which the defendant was a co-proprietor, or on the personal account of his fiancee.

The defendant denied that any part of the loans or interests were outstanding. He averred that he had paid interest regularly until some time in 1969 and that the interests claimed were excessive, harsh and unconscionable and had therefore contravened s. 22 of the Moneylenders Ordinance, 1951. There was also another side issue raised, that is, as the collaterals were merely drawn on the cheques of the transport company, the loans were in fact made to that company and not to the defendant. On the second issue, I do not consider it necessary to go far into its merits, as this matter was not expressly pleaded in the defence and was only taken up impromptu by Counsel at the hearing. Moreover, the neat pile of personal correspondence from the defendant to the plaintiff speaks in unmistakable terms that the loans were made at his behest.

I think it would be fair to conclude that the only worthy issues remaining at the end of the hearing were firstly whether the loan transaction had contravened the Moneylenders Ordinance and secondly, if so, whether the plaintiff is nevertheless entitled to restitution of the amounts actually loaned.

On the first issue I do not think the defendant need entirely rely on the presumption under s. 3 of the Moneylenders Ordinance. There is ample evidence to show that the plaintiff had numerous transactions not only with the defendant but with many other persons and, to use the plaintiff's own expression, "who are in difficult positions or when their assets were frozen." It was not disputed that in respect of the loans the plaintiff charged interest at 3% month or 36%, per annum, a percentage which is sufficiently high when compared with the 12% and 18% per annum allowable under the Moneylenders Ordinance. In the various loan transactions to the defendant the plaintiff had adopted the same system, i.e., accepting cheques as evidence of loans, including first month's interest on the cheques, dating cheques on dates of issue of loans and charging similar interest rates.

In respect of the defendant alone there were a total of 9 continuous transactions, not mentioning the few which the plaintiff admitted could have taken place. There appears to be system and continuity in plaintiff's moneylending transactions.

In the light of the foregoing I have no hesitation in holding that the defendant has proved that the plaintiff was an unlicensed moneylender and that the plaintiff had not succeeded in rebutting that evidence.

It follows, therefore, that s. 15 of the Moneylenders Ordinance would render the agreements between the parties unenforceable and such agreements would correspondingly be held void by virtue of s. 2(g) of the Contracts Act, 1950.

For obvious reasons Mr. Thakurta, Counsel for the plaintiff, did not press too hard with his arguments on this issue but contended that the plaintiff would, nevertheless, be entitled to restitution of the money loaned by virtue of s. 66 of the Contracts Act. He relied on the Privy Cou