Back
MARIKAR v. SUPPRAMANIAM CHETTAIR
NLR44V409
1943 Present: Howard C.J., Soertsz, Keuneman,
de Kretser and Wijeyewardene 33,
MARIKAR Appellant, and SUPRAMANIAM CHETTIAR, Respondent.
147-D. C. Puttalam,
4,755.
Money Lending Ordinance (Cap. 67), Sec. 2 (I) (a) (b) (c), Sec. 10 (2) and
Sec. 14-Action to reopen money lending transaction and to set aside
promissory note-Counterclaim by defendant-Defendant in default
under the Business Names Registration Ordinance-Right of defendant
to counterclaim-Powers of Court-Where note is unenforceable or
fictitious-Right to recover compound interest in Ceylon-Roman-Dutch
law-Prescription-Civil Law Ordinance, Cap. 66, Sec. 5.
Where the plaintiff sued the defendant to set aside a promissory note
made by the plaintiff in favour of the defendant, the reopening of certain
transactions and the taking of an account between himself and the
defendant,-
Held (by the whole Court) that the defendant, even if he had made default in
furnishing particulars under the Business Names Registration Ordinance, may
enforce by way of counterclaim his claim against the plaintiff in virtue of
section 9(1) (c) of the Business Names Registration Ordinance.
Held, further (by the whole Court) -
Where an account was stated six years before the date of the action, the
reopening of that transaction is barred by section 3 of the Money Lending
Ordinance.
Per HOWARD C.J., SOERTSZ AND DE KRETSER JJ. (KEUNEMAN AND WIJEYEWARDENE JJ.
dissentiente).-Compound interest is recoverable under the law of Ceylon,
although the question of such a charge may be considered on the reopening of a
transaction.
Per KEUNEMAN AND WIJEYEWARDENE JJ.-The principle of the Roman-Dutch Law
disallowing compound interest, even where it is expressly stipulated, is in
force in the Island and has not been repealed by section 5 of the Civil Law
Ordinance.
Per HOWARD C.J.-Where an account is taken with regard to an old loan and a new
note is given there is a renewal of a loan and failure to state the amount of
the capital sum borrowed renders the note unenforceable by reason of section 10
(2) of the Money Lending Ordinance.
In such a case where there is evidence that, when the note was given, an account
was taken, the Court has jurisdiction to adjudge what is fairly due on the note.
Per KEUNEMAN AND WIJEYEWARDENE JJ.-A note in regard to which the capital sum
lent has been augmented from time to time with the addition of interest and a
fresh note given so as to carry compound interest is a fictitious note within
the meaning of section 14 of the Money Lending Ordinance.
In such a case the Court has power to reopen the transaction under section 2 (1)
(a) (b) (c) of the Money Lending Ordinance.
Per SOERTSZ AND DE KRETSER JJ.-The note in question created
a debt different from a debt due on a loan of money within the meaning
of section 10 inasmuch as it was given to secure the amount outstanding
on an account stated ; it was not a fictitious note within the meaning
of section 14.
It was, however, open to the Court to order the reopening and the taking of an
account within the period fixed by section 3 as the notes were given to secure
the amount found due on an account stated in respect of money lent and were thus
within the purview of section 2 of the Money Lending Ordinance.
THE
plaintiff instituted this action for the reopening of certain transactions,
the taking of an account between himself and the defendant, the setting aside of
a promissory note marked A dated January 13, 1936, made by the plaintiff in
favour of the defendant and for judgment in his favour for any excess paid by
him to the defendant.
The plaintiff stated that there had been dealings between them for many years
and that in 1931 an account had been taken, and that he had transferred property
to the defendant to the value of Rs. 133,000 in liquidation of his liability,
leaving a balance of Rs. 27,672 for which the plaintiff gave the promissory note
P
