Present : Be Sampayo J.
CALDERA v. ZAINUDEEN.
C. B. Colombo, 83,491.
Money Lending Ordinance, 1918, ss. 10 and 13—Promissory note given,as security for future payment—Contributions to a cheetu. club—Fictitious entry in margin—
A promissory note was given as security for the future paymentof contributions, which might become due by the maker who wsba member of a cheetu club. In the margin there was an entrythat the capital sum borrowed was Bg. 100. The Commissioner,dismissed the action, as the entry was fictitious.
Held, that as the note was not given as security for a loan,sections 10 and 13 of the Money Lending Ordinance did notapply.
No doubt the entry in the margin is false, but that is notwhat is penalized by the Ordinance."
T HE facts appear from the* judgment.
J. 8. Jayawardene, for plaintiff, appellant.
E. G. P. Jayetileke, for defendant, respondent.
July 19, 1922. De Sampayo J.—
The plaintiff, who is the executor of the last will of one H. S.Caldera, sues the defendant on two promissory notes for Rs. 100each, made by the defendant in favour of H. S. Caldera. Admittedly,the promissory notes were not given as security for any loan, butonly as security for the future payment of contributions which mightbecome due by the defendant who was member of a “ cheetu club **managed by the deceased H. S. Caldera. In the margin, of each ofthese documents is & memorandum stating that “ the capital sumborrowed was Rs. 100. ” The Commissioner considered that thiswas a fictitious entry which is penalized by section 13 of the MoneyLending Qrdinance, No. 2 of 1918, and that he had no power to givejudgment for the plaintiff. Section 13 makes it an offence to take“ as security for any loan a promissory note or other obligation, inwhich the amount stated as due is to the knowledge of the lenderfictitious.” Tt is section 10 of the Ordinance which is more relevantto this case, for that section requires that in every promissory notegiven as security for the loan of money there shall be separatelyset forth upon the document, inter alia, the capital sum actuallyborrowed, and provides that any promissory note not complyingwith the provisions of the. section shall not be enforceable. Boththese sections presuppose a ” loan ” and a “ lender, ” but as the caseof both sides is that there was no borrowing at all, I do not thinkthat the Commissioner's reason for his judgment is right. No doubt
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the entry in the margin is false, but that is not what is penalizedby the Ordinance.
The plaintiff, however, is bound to fail on the faets. He wasnot able to prove how much was due by the defendant. He didnot even know how many contributors there were in this cheetuclub. The amount payable by the defendant could, I suppose, bedetermined by the number^ of contributors and the duration of theclub. The plaintiff appears to be quite inaccurately informed asto many things. He had, for instance, given credit to the defendantfor Bs. 50 only, but when the defendant’s pass book was produced,be had to admit that the defendant had to get credit for Bs. 70.Again, he claims Bs. 196.21, whereas his proctor’s letter of demandwas for Bs. 144. The only evidence upon which the Court couldbase any safe conclusion was that of the defendant. He admitsthat he has to pay Rs. 80, for which, therefore, the Commissionerhas given judgment for the plaintiff. I think that the dismissalof the claim in excess of that sum is right.
The appeal is dismissed with costs.
CALDERA v. ZAINUDEEN