JUDGMENTBY: PEH SWEE CHIN FCJ (DELIVERING THE JUDGMENT OF THE COURT)

PEH SWEE CHIN FCJ (DELIVERING THE JUDGMENT OF THE COURT) This appeal brings into focus some problems, inter alia, as to whether the charging of additional interest by a bank for default by a borrower is caught by s 75 of the Contracts Act 1950. First, a brief summary of facts and events leading to this appeal will have to be set out. The bank (the respondent/plaintiff) in this instant case is not an ordinary commercial bank but a co-operative society registered under the Co-operative Societies Act 1948.

The appellant/defendant was the chargor and the respondent/plaintiff the chargee (hereinafter the chargor and the chargee respectively as the case may be). The chargee applied for an order of the sale of land charged to secure money lent to one Khalid bin Ramlee by the chargee. A statutory order of sale was made on 10 April 1992; the charged land was duly sold by public auction and the proceeds of sale had been paid to the chargee pending an appeal against the said order of sale dated 10 April 1992 on several grounds.

First, it was submitted that the charge was void on the ground that though the loan of RM3m