A Loan to A Friend, I thought. A painful recovery lesson.


I first met “A” through my university roommate. He was quite a bit older than us, and we were flattered to be welcomed into his circle of friends. With no rental history, we were grateful when he offered to act as a referee to help us secure our first apartment lease. So, when he asked for assistance with his dissertation, I was happy to help, even though I was studying and working long hours of hospital shiftwork.

While packing to return to Malaysia after his graduation, he told me that, during his ten years as an international undergraduate student, he had accumulated a substantial debt, comprising outstanding rent, student loans and credit card purchases. As his parents had paid for his tuition and most of his living expenses, he did not want to ask them for more money, so he asked me to loan him some funds. I believed him when he promised to pay it back in regular installments once he got settled into a new job in Singapore. I didn’t know it then, but he never had any intention of paying me back.

We lost touch for many years until one day, out of the blue, he contacted me when he was at a low point in his life: his father had recently passed away and his marriage had ended after only nine months. He had tracked me down through a mutual friend, saying that he wanted to apologise for his past behaviour. Against my better judgement, I allowed him back into my life.
Once again, he was in debt: after completing a year of postgraduate study in the US, he complained that he had student loans that would take him years to repay.

Although we never lived in the same country again, we stayed in touch over many years via regular emails and online chats and occasional phone calls. I had still not recovered my money, but I considered him a friend and believed his fake promises that he would pay me back “one day”. He was telling me what I wanted to hear.

Unfortunately, he got into more financial difficulty when he bought a house and started his own business in KL. Over a period of four years, he would call whenever he had “cashflow problems” and beg me to help him out as his bank had refused to extend him more credit. The total amount ended up being a significant sum. For the first few loans, he reluctantly agreed to sign a written agreement but, later, refused, accusing me of “not trusting him”. He insisted that he was “not a liar or a cheat”. Time and again, I believed him when he promised to pay me back in full, but it turned out to be my gravest mistake.

I asked him repeatedly to repay the loans, but he always played the victim and came up with some excuse as to why he couldn’t pay. On the few occasions that I challenged him, he exploded with anger and gave me the silent treatment for months on end, so I believed my best chance of getting my money back was to avoid making him an enemy. Fast forward to 2019, with fresh acknowledgments of the debts in hand, I had no option but to commence legal action. Sadly, this marked the end of a longstanding friendship but, to my horror, when my counsel tried to retrieve the debt, the Defendant had the audacity to claim that all the funds had been given as gifts and, also, they were time barred. I was beyond incensed.

On the plus side, I was able to take comfort in the fact that, despite the pandemic, my case could still be heard and tried in the Malaysian courts, as they had adopted a model of remote hearings to ensure justice was continually being served. Although this was still a relatively new concept at the time, everything progressed smoothly. It didn’t matter that I lived abroad, and, to my relief, I was not required to travel to Malaysia to attend the hearing in-person. My evidence-in-chief, the cross-examinations and re-examinations were all conducted online from the comfort of my own home. The Malaysian justice system truly surpassed my expectations.

During cross-examination, the Defendant’s counsel bombarded me with intense questioning in the hope of manipulating the narrative and portraying that the funds were all given as gifts when, clearly, they were not. Thankfully, my counsel did not allow that to happen. With the right questions, he set the narrative straight, leading the court to an irresistible conclusion that all the fund transfers were friendly loans. Finally, after years and years of my money being withheld from me, all the delays, extensions of time, excruciatingly long hours of collating the evidence and timeline, I can say that it was worth it. With the right counsel by my side, virtually guiding me through the immensely complicated legal process, we made it to other end ringing our victory bells.

I was truly impressed with the Malaysian courts; my summary judgment application (which we lost), appeal (again, lost) and a full trial via zoom were all heard within two years from starting the legal action and I was, finally, granted a judgment in my favour for all the loans, apart from the (long ago) original one. To add icing to the cake, the Judgement Debtor decided there was no prospect for an appeal as our evidence and arguments were solid. The most gratifying moment was receiving a copy of a signed letter from the Judgement Debtor to his solicitor irrevocably authorising and consenting to the release of the sum he owed me from the proceeds of the sale of his house.

While this chapter was, without question, a very painful and bitter life lesson there was, at least, a happy ending.

Dr Hughes
December 2021

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