Level-Mute

[Supaman771]

Well, Era's Battle of the Bands is today and we were discussing that spamming could disrupt the event, or lag the level more (since there's going to be a bunch of people there).
So I made this simple toggle-able level mute NPC to throw down and solve the problem.
He said he wouldn't use it because the Timeout would "Lag the server".
I don't understand how? So if anyone could explain... as well as comment on how I could possibly code this better?
Thanks:

PHP Code:

function onCreated()
{
  setTimer( 0.05 );
  this.on = 0;
}

//#CLIENTSIDE
functon onPlayerEnters()
{
  if ( this.on == 1 )
  {
    if ( player.guild != "Judge" || player.guild != "Preformer" )
    {
      player.chat = "...";
    }
  }
 setTimer( 0.05 );
}

function onPlayerChats()
{
  if ( player.guild == "Judge" )
  {
    if ( player.chat == ":muteon" )
    {
      this.on = 1;
      player.chat = "Level-Mute Enabled";
    }
    elseif ( player.chat == ":muteoff" )
    {
      this.on = 0;
      player.chat = "Level-Mute Disabled"
    }
  }
  if ( this.on == 1 )
  {
    if ( player.guild != "Judge" || player.guild != "Preformer" )
    {
      if ( player.chat != "..." )
      {
        player.chat = "...";
      }
    }
  }
 setTimer( 0.05 );
}

function onTimeout()
{
  if ( this.on == 1 )
  {
    if ( player.guild != "Judge" || player.guild != "Preformer" )
    {
      player.chat = "...";
    }
  }
 setTimer( 0.05 );
}