JUDGMENTBY: IDRIS YUSOFF J

By an originating motion dated 5 October 1994, the plaintiff applies to the court for the following orders:

(1) That the charges dated 8 May 1984 executed by the plaintiffs

attorney in favour of the defendant in respect of 25 lots of land

registered as PT 109 (HS(D) KB 645/83); PT 110 (HS(D) KB 646/83;

and PT 113 (HS(D) KB 649/83 to PT 135 (HS(D) KB 671/83); all in

section 12, Kota Bharu, Kelantan be declared null and void and of

no effect and that the memorandum of charge registered under

charge No jilid 39, folio 36, bil perserahan No 1091/84 and

charge No jilid 39, folio 37, bil perserahan No 1092/84 with the

Pengarah Tanah dan Galian, Kota Bharu, Kelantan be cancelled;

(2) that the property sale agreement and the property purchase

agreement executed by the plaintiff and the defendant and dated 6

May 1984 be declared null and void and of no effect; and

(3) that consequent upon prayers (1) and (2) above, the defendant be

ordered to return the plaintiffs titles, free of all

encumbrances, forthwith.

Attached to the application and in support thereof is an affidavit sworn by the plaintiff on 4 October 1994 setting out the relevant facts.

As can be gathered from the plaintiffs averments in the said affidavit and the exhibits annexed thereto, the plaintiff on 6 May 1984 executed two agreements, namely the property purchase agreement and the property sale agreement with the defendant. In respect of the former, it shows that there was a purchase by the defendant of the properties listed in prayer (1) of the motion for a price of RM520,000. Having so purchased, the defendant then resold to the plaintiff for a price of RM629,200 thereby making a profit of RM109,200. It is to be noted that both the agreements were signed contemporaneously.

On 8 May 1984, the plaintiffs attorney executed a charge of the said lands in favour of the defendant as securities for the loan of RM629,200, which loan was purportedly granted under the Islamic banking concept of Al Bai Bithaman Ajil.

It is also alleged by the plaintiff that the loan was never disbursed to him but as I see it on the strength of the financing facility agreement dated 6 May 1984 executed by the plaintiff, Mariza Sdn Bhd and the defendant and in particular to cll 1(a) and 2(a) thereof, such an allegation can be brushed aside as having no basis at all. Clauses 1(a) and 2(a) are set out below:

1(a) At the request of the first-named customer (the plaintiff) and

the second-named customer (Mariza Sdn Bhd), the bank (the

defendant) hereby agrees to pay the purchase price payable by

the bank to the first-named customer under the property purchase

agreement to the second-named customer and upon the terms and

conditions herein contained.

2(a) In consideration of the bank agreeing to pay the purchase price

mentioned in cl 1(a) hereof to the second-named customer with the

concurrence of the first-named customer, the second-named

customer hereby covenants, agrees and undertakes with the bank

and the first-named customer that the second-named customer shall

in place of the first-named customer pay to the bank the purchase

price payable by the first-named customer under the property sale

agreement (the purchase price) in the amounts, at the times and

in the manner specified in s 1 of the Second Schedule hereto or

by instalments of such other amounts as shall be mutually agreed

between the bank and the second-named customer.

As such and in the absence of any evidence to the contrary, it does not now lie in the plaintiffs mouth to deny the arrangements that have heretofore been agreed upon between the said parties, more so when the loan