Raja Azlan Shah (Malaya) CJ (delivering the judgment of the Court):

The facts in this case are fully stated in the judgment of Harun J, in which (1) he dismissed the application of Central Securities (Holdings) Berhad, "the third party" to set aside the third party notice, and (2) he allowed Haron bin Mohd Zaid "the defendant" to enter final judgment against the third party.

On 12 March 1975 the defendant agreed to sell to Syarikat Seri Padu Sdn. Bhd. "the plaintiffs" 560,000 fully paid-up ordinary shares of $1 each of United Holdings Bhd. at $8 per share. The plaintiffs paid the total sum of $4,480,000 for the said shares and the defendant agreed to deliver to the plaintiffs the share certificates and the instruments of transfer within one week. The defendant delivered effectively only 36,722 shares. The plaintiffs' claim was for the refund of the purchase price of $4,186,224 paid in respect of the undelivered 523,278 shares, damages, interest and costs.

The writ was filed on 21 May 1977. The defendant entered appearance on 13 June 1977 and on 21 June 1977 took out a summons for leave to issue and serve a third party notice on the third party. The said leave was granted on 18 July 1977. The defendant claimed that the shares he sold to the plaintiffs were part of the 1,400,000 fully paid ordinary shares of $1 each of United Holdings Bhd. at $8 per share he had acquired from the third party under a written agreement dated 7 December 1974. On 22 January 1975 the defendant paid the third party the total purchase price of $11,200,000 for the said shares whereupon the latter delivered to the defendant share certificates of this amount and the necessary instruments of transfer. One of the share certificates is numbered 0227 for 523,278 shares together with the relevant instrument of transfer "Exh. H1". Pursuant to the agreement of 12 March 1975 with the plaintiffs, the defendant then delivered to them inter alia the said share certificate numbered 0227 and the instrument of transfer. On 13 December 1976, some 20 months afterwards, the plaintiffs discovered, so they alleged, that the instrument of transfer in respect of share certificate numbered 0227 was executed by the registered owner Dr. Chong Kim Choy in favour of International Holdings (Pte.) Ltd. In the meantime, the shares were registered in the name of Seri Padu. On being registered the defendant made repeated requests to the third party for a registrable instrument of transfer but the latter refused and failed to deliver the transfer form or other shares of this amount whereby the defendant claims from them that he is entitled to substantially the same relief and/or remedies as claimed by the plaintiffs against the defendant.

The third party entered a conditional appearance to the third party notice on 8 September 1977 and on 30 September 1977 applied to set aside the said notice. On 3 October 1977 the defendant applied for leave to enter final judgment against the third party, alternatively, for third party directions as follows: (i) that the defendant deliver a statement of claim to the third party within 14 days from the date of this order who shall plead thereto within 14 days; (ii) that the defendant and the third party file an affidavit of documents within 60 days from the close of pleadings and there be an inspection of documents within 30 days thereafter; (iii) that the question of the liability of the third party to indemnify the defendant be tried together with the trial of the action between the plaintiffs and the defendant, and (iv) that the costs of the application be costs in the cause. On 28 October 1977 the plaintiffs applied for leave to enter final judgment against the defendant. These applications were, by consent, adjourned into open Court and heard together.

The defendant submitted to judgment and the learned Judge accordingly gave leave to plaintiffs to enter final judgment by consent. The application of the third party to set aside the th