Schedule
Schedule A of the Moneylenders Act 1951. All the necessary information has already been disclosed. Findings by the Court Issue 1: - The OS is premature [29] I do not agree with the Defendant’s contention that the OS was premature. Section 254(1) of the National Land Code 1965 states that: - “254. Service of default notice, and effect thereof. (1) Where, in the case of any charge, any such breach of agreement as is mentioned in subsection (1) of section 253 has been continued for a period of at least one month or such alternative period as may be specified in the charge which shall not be less than one month, the chargee may serve on the chargor a notice in Form 16D - (a) specifying the breach in question; (b) requiring it to be remedied within one month of the date on which the notice is served, or such alternative period as may be specified in the charge; and (c) warning the chargor that, if the notice is not complied with, he will take proceedings to obtain an order for sale.” [30] The Defendant had argued that since the Notice of Recall was issued on 13.6.2025, the Plaintiff has failed to comply with Section 254 of the National Land Code 1965 as the 16D Notice was issued on 30.6.2025, which is less than one (1) month. This is not correct. The Defendant’s breach of the agreement did not commence on the date of the Notice of Recall. The Defendant has defaulted in the repayment since way back in 20.12.2023 (as stated in the Notice of Recall). [31] The Notice of Recall was issued to comply with Clause 5 of the Moneylending Agreement, which provides: - “5. Right of action (1) If the Borrower- (a) fails to repay any sum of instalment payable or any part thereof and any interest payable specified in Section 5 of the First Schedule for any period in excess of twenty-eight days after its due date; or (b) Commits an act of bankruptcy or enters into any composition or arrangement with his creditors or, being a company, enters into liquidation, whether compulsory or voluntary, the Lender may terminate this Agreement. (2) Upon the occurrence of any of the events specified in subclause (1) herein, the Lender shall give the Borrower not less than fourteen days of written notice to treat this Agreement as having been repudiated by the Borrower and unless in the meanwhile such default alleged is rectified or such unpaid sum or instalment and interest are paid, this Agreement shall at the expiry of the said notice, at the option of the Lender be deemed to be annulled. ….. (4) Notwithstanding subclause (3) herein, the Lender shall be entitled to deal with the Security for the purpose of claiming the balance outstanding from the Borrower as follows: (a) Where the Security is an immovable property, the property shall be dealt with as provided for under Order 83 of the Rules of Court 2012; or (b) Where the Security is a movable property, the Lender shall be at liberty to dispose of the security by auction to be conducted by a licensed auctioneer.” [32] As such, the issue of the OS being premature does not arise as the 16D Notice was issued on 30.6.2025, which is more than 14 days after the Notice of Recall. Therefore, the 16D Notice is in compliance with Clause 5(2) of the Moneylending Agreement. The OS is dated 1.8.2025, which is more than one (1) month after the 16D Notice. This is in compliance with Section 254 of the National Land Code 1965. Issue 2: - Whether the Moneylending Agreement is valid and enforceable [33] The land search that has been exhibited in the Plaintiff’s affidavit (Exhibit A-4 of Enclosure 2) clearly shows that the Plaintiff did not lodge the Caveat against the Property. Therefore, the contravention of the provisions of Schedule K of the Moneylenders (Control and Licensing) Regulations 2003 does not arise. Issue 3: - Defendant has raised the existence of cause to the contrary pursuant to Section 256(3) of the National Land Code 1965 [34] The land search also shows that the Charge has already been presented and registered. This fact has also been admitted in the Defendant’s affidavit (Enclosure 5) as follows: - “(8) Kecuali mengakui bahawa terhadap suatu gadaian telah didaftarkan pada 30.11.2022 melalui Gadaian Perserahan No 126474/2022 ke atas hartanah yang dipegang di bawah Hakmilik Geran 47917, No Lot 1959, Mukim Semenyih, Daerah Ulu Langat, Negeri Selangor (selepas ini dirujuk sebagai “Hartanah tersebut”), lain-lain dakwaan kandungan perenggan 7 Afidavit Sokongan Plaintif adalah dinafikan …” [35] As such, I am not able to accept the Defendant’s argument that the Plaintiff is attempting to enforce an unregistered charge. [36] I also accept the Plaintiff’s explanation that no double-interest was imposed on the Defendant. As correctly pointed out by the Plaintiff, the Statement of Simple Interest show the Defendant’s default period on a month-to-month basis. However, the said statement captures both the last date for a preceding month, together with the first date of a succeeding month. As both the same dates are captured, this gives the impression that double-interest was being imposed. [37] As an example, the Plaintiff had set out the calculation of interest for the period from 20.1.2023 to 8.2.2023 (a total of 19 days in default) and for the period from 8.2.2023 to 20.2.2023 (a total of 12 days in default) to show the Plaintiff’s computation of interest claimed against the Defendant: - Default Period Days Counted Total days in default Remarks 20.1.2023 – 8.2.2023 January 2023 (20.1.2023 to 31.1.2023) 12 days 8.2.2023 not counted February 2023 (1.2.2023 to 7.2.2023) 7 days 8.2.2023- 20.2.2023 February 2023 (8.2.2023 to 19.2.2023) 12 days 20.2.2023 Not counted [38] All the issues raised by the Defendant does not show the existence of cause to the contrary because the order for sale is an action in rem. In Hap Seng Credit Sdn Bhd v Rentak Arena (M) Sdn Bhd [2017] 1 LNS 1, the High Court held that: - “B. Action in Rem not Personam 10. This court says most of these issues (all these issues will be discussed in a short while) raised by the Defendant are irrelevant because the order for sale is an action in rem. It is not an action in personam. It is against the land or property itself and more so when the charge has been duly registered. It is based on statutory provision i.e., S. 256(3) of NLC for order of sale. The issues raised in respect of the moneylending transaction between the Plaintiff and Defendant is however at best only an action in personam. It does not relate to the Plaintiff's right in rem in foreclosing the property itself. 11. It is also to be noted that it is a daunting task for the Defendant to object to the Plaintiff's present OS. This is because an objection against the order for sale to be given in respect of foreclosure of a property on the ground of cause to the contrary under S. 256(3) of the NLC can only happen under three categories of cases as laid down by the Supreme Court's case of Low Lee Lian v. Ban Hin Lee Bank Bhd [1997] 1 MLJ 77. The three categories are as follows: (a) when a chargor was able to bring his case within any of the exceptions to the indefeasibility doctrine in S. 340 of the Code; (b) when a chargor could demonstrate that the chargee had failed to meet the conditions precedent for the making of an application for an order for sale and (c) when a chargor could demonstrate that the grant of an order for sale would be contrary to some rule of law or equity. 12. More importantly the facts of this case are similar to the present case before this court where the relevant passage states: As earlier observed, unless a chargor can bring himself within one of the three categories of cases set out earlier in this judgment, no cause to the contrary would be shown and the court will be obliged to make an order for sale. It would not be sufficient, as was done in the instant case, to allege mere breaches by the chargee of the loan agreement between the chargee and the borrower or even of the terms of the annexure to the charge in order to resist an application under s. 256(3) of the Code. An allegation that the chargee acted in breach of contract, while it may give rise to an independent action in personam, is insufficient per se to defeat the ad rem rights of a chargee under his registered charge to an order for sale. ……. 13. In Jigarla K Doshi @ Jigarla a/l Kantilal Doshi v. Resolution Alliance Sdn Bhd & Anor [2013] 3 MLJ 61, the Court of Appeal stated at page 68 that: In a foreclosure action, claims of, inter alia, alleged breaches of contractual obligations or challenges on the calculation of interest under the loan agreement are not relevant. The court will only be concerned with the restrictive categories of 'cause to the contrary' as laid down in the case of Low Lee Lian. The alleged breaches and challenges are matters to be raised by the appellant in a separate civil suit.” Issue 4: - Whether the Plaintiff has produced the necessary accounts [39] Lastly, I do not find any merits in the Defendant’s submission that the Statement of Account does not contain sufficient information. The Statement of Account that has been exhibited in the Plaintiff’s affidavit (Exhibit A-7 of Enclosure 2) has disclosed all the necessary information as required under Section 19, First Schedule A of the Moneylenders Act 1951, which includes: - • the date the loan was made; • the amount of the principal; • the rate of interest; • amounts already paid, detailing principal and interest; • and amounts due but unpaid, and the date they became due. Conclusion [40] Accordingly, for the reasons above, Enclosure 1 is allowed with costs fixed at RM 10,000.00. Dated the 13th day of February 2026. (SEOW HOCK PENG) JUDICIAL COMMISSIONER HIGH COURT OF MALAYA SHAH ALAM, SELANGOR Counsel: For the Plaintiffs : Tan Gideon Chau Yen Zhe (Messrs Yap Siew Yee & Co.) For the Defendants : Manpal Singh Sacdev a/l Manjit Singh Gary Au Kar Meng (Messrs Manjit Singh Sachdev Mohammad Radzi & Partners) Case Reference: 1. Hap Seng Credit Sdn Bhd v Rentak Arena (M) Sdn Bhd [2017] 1 LNS 11 Legislation Reference: 1. Section 254 of the National Land Code 1965 2. Section 256(3) of the National Land Code 1965 3. Section 19 of the Moneylenders Act 1951 4. Section 21(1) of the Moneylenders Act 1951 5.