Agus Anwar v Orion Oil Ltd: Moneylender Act & Enforceability of Loan Contracts

In Agus Anwar v Orion Oil Ltd, the Singapore High Court heard an appeal regarding the setting aside of a statutory demand. The assistant registrar initially set aside the statutory demand, finding a triable issue as to whether Orion Oil Ltd was an unlicensed moneylender under the Moneylenders Act. Lee Seiu Kin J allowed the appeal, quashing the assistant registrar's order, holding that Orion Oil Ltd had successfully rebutted the presumption that it was acting as a moneylender. The court found the loan contract enforceable.

1. Case Overview

1.1 Court

High Court

1.2 Outcome

Appeal Allowed

1.3 Case Type

Civil

1.4 Judgment Type

Grounds of Decision

1.5 Jurisdiction

Singapore

1.6 Description

The High Court held that Orion Oil Ltd was not acting as an unlicensed moneylender when it loaned Agus Anwar $10 million, thus the loan contract was enforceable.

1.7 Decision Date

5 January 2010

2. Parties and Outcomes

Party Name	Role	Type	Outcome	Outcome Type	Counsels
Agus Anwar	Plaintiff, Respondent	Individual	Appeal Dismissed	Lost	Ng Soon Kai, Mario Tjong
Orion Oil Ltd	Defendant, Appellant	Corporation	Appeal Allowed	Won	Kelvin Tan Teck San, Natasha Nur Bte Sulaiman

3. Judges

Judge Name	Title	Delivered Judgment
Lee Seiu Kin	Judge	Yes

4. Counsels

Counsel Name	Organization
Ng Soon Kai	Ng Chong & Hue LLC
Mario Tjong	Ng Chong & Hue LLC
Kelvin Tan Teck San	Drew & Napier LLC
Natasha Nur Bte Sulaiman	Drew & Napier LLC

4. Facts

The plaintiff applied to set aside a statutory demand for $10.5m.
The defendant had given the plaintiff a loan of $10m.
The plaintiff claimed the defendant was an unlicensed moneylender.
The defendant claimed it was an investment holding company, not a moneylender.
The loan agreement included interest of $500,000.
The loan was secured by shares and a house.
The plaintiff approached the defendant for the loan.

5. Formal Citations

Agus Anwar v Orion Oil Ltd, Originating Summons Bankruptcy No 29 of 2009 (Registrar's Appeal No 299 of 2009), [2010] SGHC 6

6. Timeline

Date	Event
2008-09-22	Loan agreement entered into
2008-09-24	Supplemental agreement entered into
2008-12-18	Loan repayment contemplated
2009-04-18	Statutory demand served
2009-08-07	Hearing for application to set aside statutory demand
2009-08-25	Appeal allowed and assistant registrar's order quashed
2010-01-06	Grounds for decision given

7. Legal Issues

Whether the defendant was a moneylender under the Moneylenders Act
- Outcome: The court held that the defendant had rebutted the presumption that it was a moneylender.
- Category: Substantive
- Sub-Issues:
  - System and continuity of moneylending
  - Readiness and willingness to lend to all and sundry
- Related Cases:
  - [1998] SGHC 64
  - [2003] 4 SLR 338
  - [1995] 3 SLR 231
  - (1908) 25 TLR 127
  - [1918] 1 KB 205
  - [1991] 2 MLJ 447
  - [1951] MLJ 98
  - [1992] 2 SLR 349
  - [1995] 2 SLR 13
  - [1906] 1 KB 584
  - [2005] 1 SLR 733
Enforceability of loan contracts under the Moneylenders Act
- Outcome: The court held that the loan contracts were enforceable.
- Category: Substantive

8. Remedies Sought

Setting aside of statutory demand

9. Cause of Actions

Breach of Contract

10. Practice Areas

Commercial Litigation
Banking Law

11. Industries

Finance
Oil and Energy

12. Cited Cases

Case Name	Court	Affirmed	Citation	Jurisdiction	Significance
Ang Eng Thong v Lee Kiam Hong	High Court	Yes	[1998] SGHC 64	Singapore	Cited for the two-step test to determine if a transaction is a moneylending transaction.
Mak Chik Lun v Loh Kim Her	High Court	Yes	[2003] 4 SLR 338	Singapore	Cited for the application of the two-step test in determining whether there is a business of moneylending.
Ng Kum Peng v Public Prosecutor	High Court	Yes	[1995] 3 SLR 231	Singapore	Cited for the definition of 'system and continuity' in the context of moneylending.
Newton v Pyke	N/A	Yes	(1908) 25 TLR 127	England	Cited for the test of system and continuity in determining a moneylending business.
Edgelow v MacElwee	N/A	Yes	[1918] 1 KB 205	England	Cited in relation to the test of system and continuity in determining a moneylending business.
Subramaniam Dhanapakiam v Ghaanthimathi	N/A	Yes	[1991] 2 MLJ 447	N/A	Cited in relation to the test of system and continuity in determining a moneylending business.
Esmail Sahib v Noordin	N/A	Yes	[1951] MLJ 98	N/A	Cited in relation to the test of system and continuity in determining a moneylending business.
Cheong Kim Hock v Lin Securities (Pte) (in liquidation)	N/A	Yes	[1992] 2 SLR 349	Singapore	Cited in relation to the test of system and continuity in determining a moneylending business.
Brooks Exim v Bhagwandas	N/A	Yes	[1995] 2 SLR 13	Singapore	Cited for following Litchfield v Dreyfus in determining whether there is a business of moneylending.
Litchfield v Dreyfus	N/A	Yes	[1906] 1 KB 584	England	Cited for the test of whether the alleged moneylender is ready and willing to lend to all and sundry.
City Hardware Pte Ltd v Kenrich Electronics Pte Ltd	High Court	Yes	[2005] 1 SLR 733	Singapore	Cited for the court's pragmatic approach in assessing situations where the defence of moneylending is raised.

13. Applicable Rules

Rule Name
No applicable rules

14. Applicable Statutes

Statute Name	Jurisdiction
Moneylenders Act (Cap 188, 1985 Rev Ed)	Singapore
Moneylenders Act (Cap 188, 1985 Rev Ed) s 2	Singapore
Moneylenders Act (Cap 188, 1985 Rev Ed) s 3	Singapore
Moneylenders Act (Cap 188, 1985 Rev Ed) s 5	Singapore
Moneylenders Act (Cap 188, 1985 Rev Ed) s 15	Singapore

15. Key Terms and Keywords

15.1 Key Terms

Moneylender
Statutory demand
Loan agreement
System and continuity
Litchfield test
Presumption of moneylending

15.2 Keywords

Moneylender Act
Loan
Statutory Demand
Singapore
Contract

16. Subjects

Moneylending
Banking
Finance

17. Areas of Law

Moneylenders Act
Contract Law
Civil Procedure