JUDGMENT

Abdul Malik Ishak J:

Introduction

[1] This was the plaintiff's appeal to the judge in chambers in encl. 12 against the decision of the learned deputy registrar who dismissed the plaintiff's application under O. 14 of the Rules of the High Court 1980 ("RHC"). I allowed the plaintiff's appeal in encl. 12 with costs and I, consequently, closed the court file since the matter had been disposed off. I now set out the reasons for doing so.

The Facts

[2] The plaintiff is a licensed money lending company under the Moneylenders Act 1951 and the plaintiff was given specific exemptions by the Ministry of Housing and Local Government under s. 2A(2) of the Moneylenders Act 1951. The plaintiff's licenses have been exhibited in the plaintiff's affidavit in encl. 6 as exh. "LTS10". The exemptions too have been gazetted in the Government gazette and marked as exh. "LTS11" annexed to encl. 6.

[3] The defendant, on the other hand, is an individual residing at No: 1, Jalan Padungan, Kuching, Sarawak.

[4] Now, at the request of the defendant and by way of a memorandum of agreement for a loan dated 23 May 1997, the plaintiff granted a term loan facility to the defendant for the colossal sum of RM10 million (hereinafter referred to as the "loan agreement" which has been exhibited as exh. "LTS1" of the plaintiff's affidavit in encl. 5). As security for the said loan agreement, the defendant executed a memorandum of deposit of shares dated 23 May 1997 (hereinafter referred to as the "said memorandum") based on the shares of PWE Industries Berhad and/or the shares of Ekran Berhad. A copy of the said memorandum can be seen in exh. "LTS2" annexed to the plaintiff's affidavit in encl. 5.

[5] Acting on the instructions of the defendant vide the defendant's notice dated 23 May 1997, the plaintiff had on 26 May 1997 released the sum of RM10 million to Ekran Berhad in accordance with the terms of the loan agreement. The defendant's notice dated 23 May 1997 has been exhibited as exh. "LTS13" annexed to the plaintiff's affidavit in encl. 10. So, as instructed by the defendant, the plaintiff released the sum of RM10 million to Ekran Berhad by way of a banker's cheque No: 050107 dated 26 May 1997. It can be surmised that three (3) days after the loan was approved videthe loan agreement, the plaintiff released the sum of RM10 million to the defendant through Ekran Berhad. That was indeed expeditious and swift.

[6] Pursuant to section 4.01 of the loan agreement, the term loan was for a period of six (6) months from the date of the first draw down and that would be on 26 November 1997 (hereinafter referred to as the "loan period"). Further pursuant to section 4.02(a) of the loan agreement, the defendant undertook to repay in one lump sum all amounts outstanding including interests as at the end of the loan period. Unfortunately, the defendant had failed to repay the loan at the end of the loan period and this prompted the plaintiff to file an action in the High Court of Kuala Lumpur vide suit number D3-22-2499-1998.

[7] The parties met in order to iron out their differences. On 27 October 1998, the plaintiff and the defendant entered into a settlement agreement dated 27 October 1998. Under this settlement agreement, it was agreed, inter alia, that the defendant would pay the plaintiff a settlement sum of RM7,208,611.76 (hereinafter referred to as the "settlement sum"). By virtue of the settlement agreement, suit number D3-22-2499-1998 was discontinued on 11 November 1998 by consent of both the parties. It is interesting to note that the settlement agreement dated 27 October 1998 has been exhibited as exh. "LTS4" to the plaintiff's affidavit in encl. 5 while the notice of discontinuance dated 11 November 1998 is marked as exh. "LTS9" to the plaintiff's affidavit in encl. 6. It must be borne in mind that the basis and purpose of the settlement agreement found expression in Recitals "D" and "E" of the settlement agreement itself. Those Recitals state as follow