Edgar Joseph Jr FCJ:

The Background Facts

In this appeal the essential facts to be garnered from the affidavits filed fall to be stated within a short compass.

The Appellant ("the Lessor") had entered into an Equipment Lease Agreement dated 30 December 1988 ("the Agreement") whereby it had leased to the Respondent ("the Lessee"), one unit "Elite E 330 B Plastic Injection Moulding Machine" with accompanying parts upon the terms and conditions appearing therein. Pursuant to those terms, the Lessee had deposited with the Lessor a pre-paid rent of RM3,958 ("the prepaid rent") and a sum of RM64,500 ("the security deposit") as security for the due performance of the Agreement. Payment of the security deposit and the prepaid rent was evidenced by a memorandum dated 30 December 1988 ("the memorandum of deposit").

For brevity and convenience we shall, unless the context otherwise requires, refer to the pre-paid rent and the security deposit as ("the deposits").

Clause 14.1(g)(ii) of the Agreement provided, inter alia, that in the event of a Winding-up petition being presented against the Lessee, the Lessor shall be entitled by written notice to determine and end the lease and to