IRWADI BIN IBRAHIM v AZMAN BIN JA'AFAR

Case Significance

Illustrates striking out under Order 18 rule 19: a claim clearly time-barred on its pleaded facts under section 6 of the Limitation Act 1953 discloses no reasonable cause of action, and where an unlicensed-moneylending illegality under the Moneylenders Act 1951 (substance over the "saguhati" label) and privity problems compound the limitation bar, continuing the action is an abuse of process.

This High Court decision concerns an application to strike out a writ and statement of claim under Order 18 rule 19(1) of the Rules of Court 2012, on the grounds of limitation and illegality. The plaintiff and the defendant are natural persons referred to here by their roles. The plaintiff's claim rested on an agreement dated 2015 said to involve a loan of RM500,000 repayable with a monthly "saguhati" (goodwill payment) of 4% and late-payment interest, with the alleged breach occurring in December 2015. The writ was not filed until July 2025.

The defendant sought to strike out the pleading on three grounds: that the claim was time-barred under section 6 of the Limitation Act 1953; that the underlying agreement was illegal because the plaintiff was, in substance, an unlicensed moneylender under the Moneylenders Act 1951; and that the defendant was not privy to a related loan facility relied upon. The court began from the settled principle that the power to strike out a pleading is a drastic one, to be exercised only in plain and obvious cases.

Applying that principle, the court found the application meritorious. On the principal ground, it held that the claim, on the face of the pleaded facts and without a trial, was clearly barred by limitation under section 6 of the Limitation Act 1953 — the cause of action having accrued around 2015 while the writ was filed only in 2025 — so that the pleading disclosed no reasonable cause of action and fell to be struck out under Order 18 rule 19(1)(a). On a cumulative basis, it further held that when the illegality under the Moneylenders Act 1951 — where substance prevails over the "saguhati" label given to the interest — and the questions of privity and locus standi were read together with the limitation finding, allowing the action to continue would be an abuse of process, warranting striking out under Order 18 rule 19(1)(d) as well. The court struck out the writ and statement of claim, with costs of RM4,000.

The judgment is a useful illustration of striking out on limitation and illegality: a claim clearly time-barred on its pleaded facts discloses no reasonable cause of action, and where a moneylending illegality and privity problems compound the limitation bar, continuing the action is an abuse of process.