Helmi Hamzah JC:

GROUNDS OF JUDGMENT

(The Defendant’s Counterclaim)

INTRODUCTION

[1]After the Plaintiff’s claim was dismissed for failing to comply with a Consent Order dated 4 July 2022 regarding payment for security for costs (AHT Syngas Technology NV v. Future NRG Sdn Bhd [2025] MLRHU 2270 ; (“5.5% Interest”) and an additional 2.0% interest per annum (“2.0% Additional Interest”) if the loan remained unpaid by 31 July 2016.

[2]For the full trial, parties referred to documents in the Common Agreed Bundle of Documents in Enclosure 44 (“B1”) and Enclosure 45 (“B2”), marked as Part B. The authenticity of these documents was not disputed, but their contents were.

[3]The full trial took place on 9 September 2025, 30 September 2025, and 2 October 2025.

[4]On 1 December 2025, I dismissed the Defendant’s counterclaim with costs of RM20,000.00, subject to an allocatur fee.

[5]Basically, the €200,000.00 ‘friendly loan’ was illegal under the Moneylenders Act 1951 (“MLA 1951”) because the Defendant was not a licensed moneylender.

[6]As a result of the aforementioned illegality under MLA 1951, the €200,000.00 ‘friendly loan’ agreement was therefore void under Sections 24(a), (b), and (e)Contracts Act 1950(“CA 1950”).

[7]I also did not allow restitution under Section 66CA 1950

[8]I will now set forth my full grounds of judgment for doing so.

SALIENT FACTS

[9]On 4 April 2016, the Plaintiff sent a letter to the Defendant and applied for a €200,000.00 loan at 5.5% Interest and 2.0% Additional Interest (“First Loan Application”) [pages 60-61 of B1]. In the First Loan Application, the Plaintiff requested that the €200,000.00 loan be disbursed on 7 April 2016.

[10]On 4 April 2016, the Plaintiff sent another letter to the Defendant and applied for a €200,000.00 loan at 5.5% Interest and 2.0% Additional Interest (“Second Loan Application”) [pages 63-64 of B1 ]. In the Second Loan Application, the Plaintiff also requested that the €200,000.00 loan be disbursed on 7 April 2016.

[11]On 6 April 2016, the Defendant accepted the terms and conditions of the First Loan Application [page 62 of B1].

[12]On 7 April 2016, the Defendant remitted RM866,927.20 to the Plaintiff, which was equivalent to €200,000.00 [pages 1-2 of B2].

[13]On 26 July 2016, the Plaintiff acknowledged receipt of the €200,000.00 loan from the Defendant (“Acknowledgement Letter”) [page 66 of B1].

[14]On 31 July 2016, the Plaintiff was supposed to repay the €200,000.00 ‘friendly loan’ to the Defendant, but did not fulfil this obligation.

[15]On 1 August 2016, the Defendant issued a notice of demand requiring the Plaintiff to repay the €200,000.00 ‘friendly loan’ plus 5.5% Interest within 7 days from the date of the notice of demand (“First Notice of Demand”) [page 178 of B1].

[16]On 11 August 2016, Defendant issued another notice of demand requiring the Plaintiff to repay the €200,000.00 ‘friendly loan’ plus 5.5% Interest within 7 days from the date of the notice of demand (“Second Notice of Demand”) [page 179 of B1].

[17]The Plaintiff denied making any loan application to the Defendant and stated that it only received an advance payment of €200,000.00 from the Defendant, which had already been utilised to offset the amount purportedly owed by the Defendant in relation to the construction of the 1MW coal gasification system for another company named Fitters NRG Sdn Bhd.

ISSUES

[18]The Defendant’s counterclaim concerns the following issues:

(a)Loan or Advance Payment?

Did the Defendant give an advance or a ‘friendly loan’ of €200,000.00 (RM866,927.20) at 5.5% Interest and 2.0% Additional Interest to the Plaintiff? (“Issue No.1”).

(b)German law or Malaysian Law?

Which law, German or Malaysian, should be applied to dispose of the Defendant’s Counterclaim? (“Issue No.2”)

(c)Status Of The Loan Under MLA 1951

If the Defendant lent €200,000.00 to the Plaintiff at 5.5% Interest and 2.0% Additional Interest, what is the status of the said €200,000.00 ‘friendly loan’ under MLA 1951? (“Issue No.3”).

(d)Recovery Of The Principa