MBf given leave to appeal CF decision

17/ 4/2002 The Star

KUALA LUMPUR: MBf Finance Bhd was allowed by the Court of Appeal yesterday to reopen argument on whether a house buyer needed to repay his loans to the financial institution once a temporary Certificate of Fitness (CF) has been issued.

Justices Mokhtar Sidin, Saari Mohd Yusoff and Alauddin Mohd Sheriff granted MBf Finance leave to appeal against a High Court’s decision which ruled that the financial institution was to refund house buyers Oh Teik Kam and Gan Tack Kong the RM160,996.68 which they have paid between Nov 1, 1996, and June 30, 1998.

MBf Finance was ordered by the panel to file notice of appeal within two weeks.

Another panel of the Court of Appeal had in January 2000 handed down a judgment affirming a High Court’s ruling that loan repayments need only be made after the issuance of a permanent CF and not a temporary one.

In an affidavit supporting the leave application, MBf Finance’s credit control manager, Jerry Thasan, said Oh and Gan had borrowed RM606,300 on April 17, 1999, to buy a factory lot in Puchong Industrial Park.

The terms of the loan agreement, he said, stated that the borrowers needed only to make repayments once the CF was issued.

Through a letter dated Sept 26, 1996, he said, MBf Finance demanded repayment from the two stating that a temporary CF had been issued.

Following the demand, he said, the borrowers began repayment and by June 1998 when over RM160,000 had been paid out, Oh and Gan initiated legal action in the High Court.

In the originating summons dated Sept 30, 1998, he said, the borrowers sought to declare that they need not make the repayments and they were entitled to a refund for payments made.