Seven Seas Supply Company v Rajoo

CourtFederal Court (Singapore)
Judgment Date07 October 1965
Docket NumberCivil Appeal No 39 of 1965
Date07 October 1965
Seven Seas Supply Co

[1965] SGFC 5

Tan Ah Tah ACJ


M Buttrose J


J W D Ambrose J

Civil Appeal No 39 of 1965

Federal Court

Civil Procedure–Pleadings–Whether trial judge decided case on issues not raised by pleadings–Contract–Illegality and public policy–Statutory illegality–Whether contract illegal and void–Whether moneys loaned under contract recoverable by lender–Moneylenders Ordinance 1959 (No 58 of 1959)

The respondent claimed a balance of $9,940 from an alleged loan of $15,000 to the appellant. The appellant denied being indebted to the respondent at all, but alleged that there was an arrangement under which the respondent lent a total of $22,500 to one Kesar Singh, who paid the sums to the appellant. The appellant claimed to have paid interest to the respondent and to have repaid a total of $15,500 to Kesar Singh, but made no mention of the balance of $7,000. The trial judge found that there was only one transaction in which Kesar Singh was the intermediary. A total sum of $22,500 had been advanced of which $15,500 had been repaid, leaving a balance of $7,000 outstanding.

On appeal, the appellant argued that: (a) the trial judge had decided the case on issues not raised by the pleadings; and (b) the loans were illegal and void under the provisions of the Moneylenders Ordinance 1959 (No 58 of 1959) and were consequently not recoverable by the respondent.

Held, dismissing the appeal:

(1) The issues decided by the trial judge were raised by and fell fairly and squarely within the general scope and ambit of the pleadings. The core and essence of the claim was for money lent and it never changed its character throughout: at [19] and [23].

(2) Where the contract is ex facie illegal, the court will decline to enforce it, irrespective of whether illegality is pleaded or not. However, the court should not refuse to enforce a contract on the ground of illegality unless it is quite certain that all the relevant facts are in evidence. In the present case, it was impossible to say that all the relevant circumstances relating to the question of whether the plaintiff was a moneylender or not were before the court: at [27], [29] and [32].

Edler v Auerbach [1950] 1 KB 359; [1949] 2 All ER 692 (folld)

Kiaw Aik Hang Co Ltd v Tan Tien Choy [1964] MLJ 99 (folld)

Snell v Unity Finance Ltd [1964] 2 QB 203; [1963] 3 All ER 50 (folld)

Moneylenders Ordinance 1959 (No 58 of 1959)

H L Wee and M N Samy (Pillai & Co) for the appellant

L Rayner (L Rayner) for the respondent.

M Buttrose J

(delivering the judgment of the court):

1 This was an action for money lent.

2 In view of the argument addressed to us on the hearing of the appeal, I propose to deal firstly with the pleadings. The case as presented by the pleadings was this. The plaintiff in his statement of claim alleged that the sum of $15,000 in all was lent in varying amounts to the defendants between 9 March and 22 July 1961, and that $5,060 had been repaid by instalments between 10 May and 28 August 1961, leaving a balance due to him of $9,940 which he claimed.

3 The defence was a somewhat curious and confused document. The defendants first of all denied being indebted to the plaintiff either in the sum claimed or at all. They further alleged that on 1 March 1961 the plaintiff and the defendants entered into a written agreement, which was produced at the trial, whereby the plaintiff agreed to finance the defendants in their business from time to time with friendly loans free of interest. The defendants alleged that after the execution of this agreement the plaintiff failed to perform his obligations thereunder and they threatened him with civil proceedings for damages for breach thereof. As a result, according to the defendants, the plaintiff agreed to lend money to the defendants not on the terms stipulated in the written agreement but upon payment of interest at 24 per centum per annum...

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