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Caveats, Prohibitory Orders and Injunctions Under The National Land Code 1965
Caveats, Prohibitory Orders and Injunctions Under The National Land Code 1965
Introduction
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Perlis and Terengganu. As for the State of Johor, its land laws
were codified as the Land Enactment No. 1 (2 of 1910). It was
in operation for over 50 years until it was replaced by the NLC
in 1966. It is interesting to note that under s. 2 of the repealed
Johore Land Enactment, “the court” means the Supreme Court of
Johore, and only one form of caveat in Schedule L is provided
under s. 55 of this Enactment, where the person whose title is
bound by the caveat is called the “caveatee”, an expression not
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– to replace the complex of seven separate and out-moded laws
by a single statute of general application throughout all eleven
States and so establish a uniform system of land tenure and
dealing appropriate to the present day.
For such a unified system there can be only one model that is
already in existence in the majority of the States as described in
(b) above. In itself it is entirely acceptable; it is efficient, well tried
and familiar and can without difficulty be modified to suit modern
requirements. In nine States its introduction will mean no break
in continuity and in Penang and Malacca the way for its
introduction has already been prepared by the National Land Code
(Penang and Malacca Titles) Act 1963 which, when brought into
force, will abolish the existing system described in (a).
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It should be noted that, with effect from 1 August 2012, the new
Rules of Court 2012 (P.U. (A) 205/2012) came into operation,
repealing, under O. 94 r. 1, the Rules of the High Court 1980
and the Subordinate Courts Rules 1980.
Provided that the Court may either of its own motion or on the
application of any party to any proceedings and after considering
the interests of justice in those proceedings, order that the
proceedings (other than the giving of evidence by a witness) shall
be partly in the national language and partly in the English
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language.
(1) The national language shall be the Malay language and shall
be in such script as Parliament may by law provide:
Provided that –
….
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in the national language. Delivering the judgment of the Federal
Court, Richard Malanjum CJ (Sabah and Sarawak) said at p. 636:
[30] Accordingly, on the authority of Dato’ Seri Anwar Ibrahim v.
Tun Dr. Mahathir (supra) which we accept as good law, we hold
that grounds of judgments do not fall within s. 8 of the Act, and
the court has a wide discretion whether to conduct proceedings in
the English language or in the national language, be it on the
courts own motion or on application by the parties. Further,
judges have the discretion to provide their grounds of judgment
in either in the national language or the English language. The
choice of language adopted by the respective judge is not open
for challenge as long as it is in the national language or the
English language.
vi Current Law Journal [2013] 1 CLJ
...
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country. The best of post-independence judgments written in the
English language by judges of the Malaysian High Court, the
Federal Court and its successor, the Supreme Court [now the
Federal Court with the Court of Appeal below it] are of
comparable standard and quality with those of their counterparts
in the Commonwealth.
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Non-Compliance With The Rules
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Divorce) Act 1976 [Act 164]
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[Form 19F]
(Section 320)
……………………………………………………………………….........
………………………………..
Registrar/Land Administrator
Definitions
“Registrar” means –
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under subsidiary title dependent on a Land Office title, the
Land Administrator.
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the insertion of subsection (1)(ba), now reads as follows:
320 Circumstances in which Registrar’s caveats may be entered
(ba) for securing that the land will be available to satisfy the
whole or part of any debt due to the Federation or the
State Authority, whether such debt is secured or
unsecured and whether or not judgment thereon has been
obtained; or
xii Current Law Journal [2013] 1 CLJ
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Authority Of The High Court
Bhd [1980] 1 LNS 150; [1981] 1 MLJ 234, where Raja Azlan
Shah AG LP (as he then was) said at p. 237:
Reading section 418 of the Code, we are satisfied that the latter
is the correct interpretation. Having regard to the special provision
for limiting the time within which to enforce the right, the
indications are that Parliament has by using plain and
unambiguous language intended the right to be exclusive of any
other mode of enforcing it. The time-limit is the foundation of the
right given in the section. It is in the highest degree improbable
that the period of three months as a limitation would have been
inserted if an indefinite period were intended to be given. The
period of the three months is obviously for the purpose of
preventing stale claims.
In Public Bank Bhd v. Pengarah Tanah & Galian & Anor [1989] 1
LNS 159; [1990] 2 MLJ 510, Mohtar Abdullah JC (as he then
was), without referring to the above earlier case of Land Executive
Committee of Federal Territory, held that the three-month period
runs from the date of communication. His Lordship said at p. 510:
By virtue of s. 418, the time limited for appeal against the order
of the registrar is three months from the date of communication
of the decision of the registrar. The decision of the registrar in
this case is the decision to enter the caveat and not the decision
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to refuse the application for cancellation of the said caveat since
para (b) and the second limb of para (c) of s. 321 are not
relevant in the present case. Therefore, for the purpose of
computation of time under s. 418, it is crystal clear that time runs
from the date of communication of the decision of the registrar to
enter the caveat, ie, 20 October 1988. The plaintiff’s appeal under
s. 418 was entered on 29 January 1989. Therefore, I hold that
the Plaintiff’s appeal was filed out of time and consequently time
barred.
Appeal Procedure
Person Aggrieved
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closed.
There are relatively a few cases reported in the law reports on the
Registrar’s caveat. One of the leading cases under s. 418 against
the decision of the Registrar to enter his caveat under the NLC
is Temenggong Securities Ltd and Tumbuk Estate Sdn Bhd v. Registrar
of Titles, Johore which was commenced by originating motion No.
4 of 1973 by the two applicants in the Muar High Court as
persons aggrieved. In this High Court case (unreported), the
Malaysian Inland Revenue Department requested the Registrar of
Titles to enter a Registrar’s caveat over certain lands sold by the
registered proprietor Li-Ta Company (Pte) Ltd as vendor to the
first applicant Temenggong Securities Ltd which had paid the full
purchase, and had received the transfers and the issue documents
of title and possession of the lands on completion of the
[2013] 1 CLJ Current Law Journal xv
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In The Federal Court
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(ii) that the Registrar was not entitled to enter a Registrar’s for
unpaid income tax at p. 48:
The characteristic which is common to the three categories of
persons specified in sub-paragraph (ii) is that they are handicapped
in their ability to search for themselves the entries in the register
relating to land in which they are entitled to an interest or to learn
of any threatened dealing with the land which might have the
effect of overriding their interest and which accordingly would
justify an application for a private caveat. So far as these three
categories of persons are concerned, in their Lordships’ view the
clear intention of Parliament in including paragraph (b) in
s. 320(1) was to enable the registrar of his own initiative to do
for persons in any of these categories what could have been done
upon an application made by them for private caveat; and to do
no more than that. As a public servant appointed by the state,
the registrar is an appropriate officer himself to do on behalf of
the Federation and the State Authority what in the case of private
individuals he could be required to do by a formal application on
[2013] 1 CLJ Current Law Journal xvii
Amendment To s. 320
After the decision in the Privy Council was made against the
Registrar of Titles, amendment was made to s. 320 of the NLC
by the insertion of (ba) to s. 320(1) by Act A444, gazetted on
15 February 1979 (see my article Registrar’s Caveat Amended
[1980] 1 MLJ, vii, and judgment of Mohamed Dzaiddin J (as he
then was) in Lim Ah Hun v. Pendaftar Hakmilik Tanah, Pulau
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Pinang & Anor [1990] 2 CLJ 640; [1990] 2 CLJ (Rep) 369,
cancelling the Registrar’s caveat). The amendment to s. 320 does
not appear to assist the Government in tax collection where the
land in question has been charged. But the situation may well be
different where the tax payer’s land is not charged and is free
from encumbrances. In Oversea-Chinese Banking Corp Ltd v.
Pendaftar Hakmilik, Negeri Kedah [1990] 2 CLJ 275; [1990] 2 CLJ
(Rep) 594, KC Vohrah J (as he then was) did not support the
entry of the Registrar’s caveat. He said at p. 598:
It seems to me that once there is a charge registered in respect
of the land, a Registrar’s caveat is incapable of being entered in
respect of the land for it cannot possibly appear “necessary or
desirable” to him “for securing that the land will be available to
satisfy the whole or any part of the debt due the Federation”
since the caveat will not transform an unsecured debt into a
secured debt let alone give the debt a priority over other
registered interest in the land; instead the caveat serves to interfere
with the legitimate right of the chargee to sell the land under the
provision of the code to recoup losses secured by the charge.
xviii Current Law Journal [2013] 1 CLJ
In Public Bank Bhd v. Pengarah Tanah & Galian & Anor [1989] 1
LNS 159 referred to earlier, a Registrar’s caveat was entered also
at the request of the Inland Revenue Department. In this case,
the plaintiff bank as registered charge applied by letter to the
Registrar to remove his caveat but the Registrar rejected the
chargee’s application to cancel the caveat. The proprietors of the
land affected, however, had not made the application for
cancellation of the caveat under s. 321(3)(b) of the NLC. Mohtar
Abdullah JC (as he then was), accepting the submissions of the
then Johor State Legal Adviser Zulkefli bin Ahmad Makinudin
(now CJ (Malaya)) for the first defendant, and Senior Federal
Counsel Balia Yusof bin Wahi (now JCA) for the second
defendant, correctly dismissed the appeal of the plaintiff
represented by Tan Kiah Teck on the ground that the appeal was
filed out of the three-month statutory period. A lesson to be
learned from this case is that whether or not a person or body
aggrieved requests the Registrar to cancel his caveat, it is always
prudent to file the appeal in the High Court within the three-
month period.
Private Caveat
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private caveats. Private caveats are practically entered every day
throughout Peninsular Malaysia in transactions involving sales and
purchases of land of various categories of uses (including industrial
land, houses and strata title units like condominiums), and loan
transactions to finance the purchases of various immovable
property. A basic working knowledge of private caveats is therefore
important to the practice of advocates and solicitors in advising or
acting for their clients whether in conveyancing or litigation.
(2) The effect of any private caveat expressed to bind the land
itself or an undivided share in the land shall, subject to sub-
sections (4) and (5), be to prohibit so long as it continues
in force the registration, endorsement or entry on the register
document of title thereto of –
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(5), be to prohibit the registration, endorsement or entry on
the register document of title of –
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The effect of these provisions is not to enlarge or add to the
existing proprietary rights of the caveator upon which the caveat
is founded, but to protect those rights, if he has any.
Caveatable Interest
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It is important to note that not everyone is entitled to enter a
private caveat and that before a person applies in Form 19B of
the NLC for the entry of a private caveat, he must make sure that
he has a caveatable interest in the land concerned under
s. 323(1) of the NLC.
In AKB Airconditioning & Electrical Sdn Bhd v. Hew Foo Onn &
Anor [2002] 1 LNS 26; [2002] 5 MLJ 391, Abdul Malik Ishak J
(as he then was) succinctly stated the law at p. 401 as follows:
It is wrong to presume that every person has a right to enter a
private caveat. Section 323 of the NLC envisages the situation
that only a person having a caveatable interest may enter a private
caveat. It is essential that a person who enters a private caveat
must claim title to the land or any registrable interest in the land
or any right to such title or interest to the land. Under s. 324(1)
of the NLC, it is not the duty nor the function of the registrar
to enquire into whether the application for the entry of a private
caveat is validly made. It is the domain of the High Court to
xxii Current Law Journal [2013] 1 CLJ
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It is trite law that a caveator must have a caveatable interest in
the land and not merely a pecuniary interest in it before he can
lodge a caveat under s. 323 of the National Land Code (Registrar
of Titles, Johore v. Temenggong Securities Ltd. [1976] 2 MLJ 44).
Thus, in Wong Kuan Tan v. Gambut Development Sdn. Bhd. [1984]
2 MLJ 113, a contractual right to an unpaid balance of the
purchase price of the sale of land was held by the Federal Court
to be incapable of creating a caveatable interest in land which
would entitle the caveator to continue to maintain his caveat.
Likewise, in the Supreme Court case of Abdul Rahim v. Vallapai
Shaik (a case cited by defendant’s Counsel), an agreement entered
into by the three beneficiaries of the estate of the deceased to sell
land which was conditional upon consent being given by the four
other beneficiaries and upon the purchaser making the monthly
instalments towards the discharge of charge of that land to the
bank, was held to confer no caveatable interest on the purchaser.
[2013] 1 CLJ Current Law Journal xxiii
No Caveatable Interest
The courts have held that in the following cases the following
persons have no caveatable interest. A creditor or judgment
creditor of a proprietor of land is not entitled in law to enter a
private caveat against the debtor’s land to secure or realize a debt
for the reason that a mere debt, whether under a judgment or not,
is not an interest relating to land. A judgment creditor for a
monetary debt may take out execution proceedings against the
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land of the judgment debtor made by way of a prohibitory order
under ss. 334 to 339 of the NLC. In Hiap Yiak Trading Sdn Bhd
& Ors v. Gim Hin & Co (M) Sdn Bhd [1989] 1 LNS 32 in which
the applicants had paid the full purchase price, the private caveat
and prohibitory order were removed because they were not
interested in the land as they sought only the refund of the
deposit and other expenses. In United Malayan Banking Corp Bhd
v. Development & Commercial Bank Ltd [1983] 1 CLJ 82; [1983]
CLJ (Rep) 421, the Federal Court held that failure to obtain the
consent of the first chargee meant that the appellant bank did not
have a caveatable interest in the land. The claimant for a mere
chose in action arising out of or incidental to a contract for the
sale of land is not entitled to enter a private caveat (see Mawar
Biru Sdn Bhd v. Lim Kai Chew And Another Application [1990] 1
LNS 123). The caveator’s appeals to the then Supreme Court
were dismissed on 11 June 1991. A tenant for a tenancy for two
years with an option for having it renewed for a further two years
has no caveatable interest (see Luggage Distributors (M) Sdn Bhd
v. Tan Hor Teng @ Tan Tien Chi & Anor [1995] 3 CLJ 520). A
xxiv Current Law Journal [2013] 1 CLJ
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(a) Apply in the prescribed Form 19B, which may be printed or
typed. The relevant particulars must be properly completed.
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that “where the claim is in respect of a part of the land the
caveat binds the whole land.” Note also para 3(c) of Form
19B. In my experience, I would, while indicating the whole
land, state and limit the caveat to the particular interest
claimed in column 4 of the Schedule like “limited to the X
sq. ft.” or “limited to the Y unit” (in Malay: Semua. Terhad
kepada X kaki persegi or Terhad kepada unit Y). The
details of the interest claimed in the agreement or a plan of
the land affected can be disclosed in the supporting statutory
declaration. Note the provisions in the new s. 322(5A) on
the question concerning the consent of the caveator. (See the
judgment of Suffian LP in the Federal Court case of N.
Vengedaselam v. Mahadevan & Anor. [1976] 2 MLJ 161.)
(g) Pay the appropriate registration fees, which vary from state
to state [and time to time]. For example,
(iii) under the Selangor Land Rules 2003, the fee is RM300
per title (item 40), and
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Sdn Bhd v. Toh Chin Ann [2008] 4 CLJ 756, Gopal Sri Ram JCA
(as he then was) said at p. 761 in delivering the judgment of the
Court of Appeal:
The caveat is not grounded on the fact that the order for sale is
invalid. In Luggage Distributors Sdn Bhd v. Tan Hor Teng [1995] 2
CLJ 713, this court held that a caveator is bound by the grounds
he or she sets out in the application in Form 19B for the entry
of the caveat. It was also held if the grounds disclosed in Form
19B do not disclose a caveatable interest, then cadit quaestio.
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there would be no way in which caveator like the defendant who
had already filed his action could protect his existing interest
pending resolution of his dispute by the Court. It seemed to me
that s. 328(1) merely provided for the normal longevity of a
private caveat and envisaged a time frame within which the
caveator should take action to realize his existing interest; it did
not exist to extinguish his right to further protection of that
interest if he had taken positive action, as was done in the present
case, to realize it.
Nik Mah binte Nik Mat & Another [1951] 1 LNS 24, Briggs J held
that the caveat of Haroon cannot prevail over the prior equities
of Nik Mah. In the Temenggong Securities case, I was involved as a
solicitor in the sale and purchase of the relevant lands in the early
1970’s, just a few years after the NLC had come into force. At
that time I did not know of the Registrar’s caveat. The purchaser
had paid the full purchase price and had received the transfers and
other relevant documents. The purchaser and its nominee did not
enter any private caveat. The Inland Revenue Department had
caused a Registrar’s caveat to be entered against the lands. The
High Court refused to remove the caveat. On appeal, the
Registrar’s caveat was ordered to be removed by the Federal
Court, which was affirmed by the Privy Council. Much to my
relief, Temenggong’s nominee eventually became the registered
proprietor of the land free from encumbrances. In the Court of
Appeal case of Tsoi Ping Kwan v. Medan Juta Sdn Bhd & Ors
[1996] 4 CLJ 553, the second respondent company did not
appear to have entered a private caveat and its knowledge of the
appellant’s caveats did not affect its interest adversely. Gopal Sri
Ram JCA (as he then was), finding “the balance of convenience
favours the second respondent”, said at p. 567:
In our judgment, it would be wholly unjust and inequitable to
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permit the appellant to contend that the caveats should remain as
against the second respondent which, in the light of the
circumstances adumbrated by Raja Aziz in the course of his
address to us, is entirely innocent.
In Bank of Tokyo Ltd v. Mohd Zaini Arshad & Anor [1991] 2 CLJ
989; [1991] 2 CLJ (Rep) 341, Lim Beng Choon J held that the
plaintiff bank, as financier and absolute assignee, had the better
equity. The learned judge said at p. 349:
On principle and authority I cannot, therefore, accept the
proposition that just because the intervenor had caveated the land
in question in 1984 the priority of the plaintiff should be reduced
and be subservient to the equity of the intervenor.
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the NLC. A caveator may withdraw his caveat at any time by
presenting to the Registry or Land Office a notice in Form 19G
duly completed and accompanied by the prescribed fees.
There are two ways of removing a private caveat under the NLC
by the caveatee, ie, the person or body whose land or interest is
bound by a caveat. One way is by application under s. 326 in
Form 19H to the Registrar or the Land Administrator as the case
may be and paying the prescribed fee. A registered proprietor or
registered chargee under the NLC may proceed to remove the
caveat under s. 326 by virtue of his registered interest. The other
way is by application to the High Court as an aggrieved person
under s. 327(1) of the NLC to cover any one whose land or
interest therein is adversely affected by the caveat. See the well-
considered judgment of Abdul Malik Ishak J (as he then was) in
xxx Current Law Journal [2013] 1 CLJ
AKB Airconditioning & Electrical Sdn Bhd v. Hew Foo Onn & Anor
[2002] 1 LNS 26; [2002] 5 MLJ 391 at 403 on an aggrieved
person, where he said:
If you are acting for the caveatee, you will have to decide and
advise clients as to which one of the two ways is the more
expedient in the circumstances of the case, bearing in mind (a)
the workload and the hearing time of the High Court concerned
and (b) the duration for removal by the Registrar or Land
Administrator is two months under s. 326(1B) after service, when
the burden is on the caveator to obtain an order for extension of
his caveat from the High Court.
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caveator failed to get an order to extend its private caveat before
Helmy J (as he then was) and the caveat was accordingly removed
by the Land Administrator.
In 1991 in Kumpulan Sua Betong Sdn Bhd v. Dataran Segar Sdn Bhd
[1992] 1 CLJ 20; [1992] 1 CLJ (Rep) 150, the Federal Court by
a 2:1 majority held that there were serious questions to be tried
and that the balance of convenience was in favour of allowing the
caveat to remain. Jemuri Serjan CJ (Borneo) said for the majority
at p. 158:
The crucial issue for our determination is whether in order to
support the caveat to remain in force, the appellant has succeeded
in satisfying us that it is a body at whose instance a caveat may
be entered under s. 323(1)(a). This seems to be the logical
approach to the issue. Be that as it may, the approach that is
common in Malaysia before the case of Eng Mee Yong & Ors v.
Letchumanan [1979] 1 LNS 18 was decided by the Privy Council,
is to ask the question whether the caveator has a caveatable
interest which terms are not defined in the National Land Code
1965, by applying to him para. (a) of sub-s (1) of s. 323 of the
Code. The relevant question which the court should address itself
to is: Is the appellant a person claiming title to, or registrable
interest in any alienated land, or any right to such title or interest?
If it is not, that ends the matter and the caveat cannot be allowed
to remain. The factual matrix of the claim to be a person or body
within the purview of para (a) of the subsection must be minutely
considered by evidence to establish that the claim is not frivolous
or vexatious. This approach can be best illustrated by reference
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to the judgments of all the three Federal Court judges in the
Federal Court case of Macon Engineers Sdn Bhd v. Goh Hooi Yin
[1976] 1 LNS 67 where reference was made to s. 323(1)(a) of
the Code in the course of the judgments. At p. 54 Gill CJ
(Malaya), in dealing with s. 323(1)(a) of the NLC, says: “As
regards the first questions, s. 323(1)(a) of the National Land
Code 1965 provides that a private caveat may be entered at the
instance of ‘any person or body claiming title to, or any
registrable interest in, any alienated land or may right to such title
or interest.’ It would seem clear that the respondent cannot claim
title to or any registrable interest in the property in question
merely on the strength of the sale agreement which is a non-
statutory and non-registrable instrument, but it cannot be denied
that has a right under that agreement to such title or interest by
bringing an action for specific performance of the agreement,
which in fact he has already done.
xxxii Current Law Journal [2013] 1 CLJ
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the caveator to satisfy the court that his evidence does raise a
serious question to be tried as regards his claim to an interest in
the land in question, and having done his claim so he must show
that, on a balance of convenience, it would be better to maintain
the status quo until the trial of the action by preventing the caveatee
from disposing of his land, as laid down by Lord Diplock in Eng
Mee Yong & Ors. v. Letchumanan [1979] 2 MLJ 212, and by
analogy indirectly to American Cyanamid Co v. Ethicon [1975] AC
396 as indicated by Lord Diplock, the serious question for trial
referred to above could mean a question not being vexatious or
frivolous.
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Caveating Own Land
In Hiap Yiak Trading Sdn Bhd & Ors v. Hong Soon Seng Sdn Bhd
[1990] 1 CLJ 912; [1990] 2 CLJ (Rep) 117, Richard Talalla JC
(as he then was) held that the registered proprietor could caveat
its own land, and the caveat in question should remain as the
nature of the agreements and the compensation issue should be
tried.
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concurred, in ordering payment of damages, said at p. 506:
On that conclusion, we allow this appeal with costs here and
below and order that the deposit be refunded to the appellant.
Consequentially, there will also be an order to assess damages by
the Registrar of the High Court, Melaka, to be paid by the
respondent to the appellant under s. 329(1) of the National Land
Code 1965. The private caveat Jilid 75 Folio 99 entered by the
respondent against Lot 1915 is to be removed forthwith and ex
parte order for extension of the caveat is set aside.
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At the end of the day, the purchaser got the land worth
approximately RM120,000,000, for which they had paid only
RM47,939,958.
[16] On the facts of this case the Land Administrator had clearly
acted within the powers conferred upon him by s. 326(1B) of the
Code in removing the appellant’s 4th private caveat for failure to
furnish a court order within the time specified. The judicial
commissioner was right in ruling that once a private caveat has
been removed, the Code does not give the court power to revive,
renew/continue a private caveat which has been cancelled. It is not
within the inherent jurisdiction of the court to make orders which
go beyond the limit of the powers expressly given to it by statute.
Restoration Of Caveat
If a private caveat had been wrongly removed, the court has the
power to restore it. In Palaniappa Chettiar v. Letchumanan Chettiar
[1981] 1 LNS 83; [1981] 2 MLJ 127, the caveat was removed
by the High Court, but on appeal the Federal Court ordered the
caveat to be restored on the ground at p. 129 that:
There are many factors concerning the caveat which were not
considered and from the evidence that is available the
considerations in favour of maintaining the caveat outweigh any
consideration that has so far been shown to be in favour of
removing it. We therefore restored it.
In Syed Ibrahim bin Syed Abdul Rahman v. Liew Su Chin (F) [1983]
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1 LNS 45; [1984] 1 MLJ 160, the Federal Court refused to
restore the caveat of the appellant ordered to be removed by Wan
Hamzah J Lee Hun Hoe CJ (Borneo) said at p. 163:
The learned Judge rejected the contention of the appellant that he
was entitled in law to have the caveat imposed. He cited the
principle laid down in Karuppiah Chettiar v. Subramaniam and
followed in Temenggong Securities Ltd. & Anor. v. Registrar of Titles,
Johore & Ors. that once the owner by a sale had wholly disposed
of the land he divested himself of all interest therein and he
becomes thereby merely a bare trustee for the purchaser. There
was therefore no interest remaining against which a third party’s
caveat can lie. He distinguished Macon v. Goh Hooi Yin from the
case before him where the respondent had paid the full purchase
price. But in Macon’s case the earlier of the two sales was not
completed as only part payment was made. The later sale was
completed by full payment of the purchase price. Also, there was
a pending suit whereas there is none in the instant case. The
question of notice on the part of the appellant becomes important
as both sales were unregistered and subject to the approval of the
State. On the evidence the learned Judge held that the appellant
had notice of the earlier sale.
[2013] 1 CLJ Current Law Journal xxxvii
Joint-Venture Cases
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In the proceedings before us, what interest does the respondent
possess? It is not in the land. That has already been validly sold.
Her interest really lies in the profits that her company hopes to
gain from the joint venture agreement with the appellant, which is
being challenged by the appellant. The civil suit testifies to this.
As her interest is only monetary in nature, she has therefore no
caveatable interest over the land. She cannot continue to have the
private caveat lodged by her extended until after the disposal of
the civil suit.
The above Trans-Summit case, Hew Sook Ying v. Hiw Tin Hee
[1992] 3 CLJ 1352; [1992] 1 CLJ (Rep) 120, and Perbadanan
Setiausaha Kerajaan Selangor & Ors. v. Metroway Sdn Bhd & Anor
& Another Appeal [2003] 3 CLJ 339 were referred to and followed
by the Court of Appeal (Mokhtar Sidin JCA, Mohd Ghazali
Yusoff JCA (as he then was), and Zulkefli Makinudin JCA (as he
then was)) in Tan Geok Teck & Yang Lain lwn. Upaya Kelana (M)
Sdn Bhd [2007] 3 CLJ 312, a case on joint-venture to develop a
xxxviii Current Law Journal [2013] 1 CLJ
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[1998] 2 CLJ 909 at p. 913 Gopal Sri Ram, JCA (as he then
was), in delivering the unanimous judgment of the Court of
Appeal, said:
Before us, counsel for the appellant properly conceded that there
was a caveatable interest and that the matters put in issue during
the caveat proceedings did raise serious questions to be tried. She
however argued that the learned judge had erred in failing to
consider the balance of convenience. She submitted that the caveat
could not be permitted to remain on the register because the
respondent had not timeously commenced proceedings for specific
relief. Counsel also drew our attention to the fact that no action
had been instituted even as at the date of hearing of this appeal.
[2013] 1 CLJ Current Law Journal xxxix
After citing the Privy Council case of Eng Mee Yong & Ors v.
Letchumanan [1979] 1 LNS 18; [1979] 2 MLJ 212, at 215, on
timeous action to be taken for specific performance, the learned
judge continued at p. 2362:
The importance of timeous institution and prosecution of
proceedings in this area of the law is well brought out by the
judgment of Sinnathuray J, in the Singapore High Court in Teoh
Ai Choo v. Leong Sze Hian [1982] 2 MLJ 12. It is a brief
judgment and merits reproduction here:
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…
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v. Hiw Tin Hee [1992] 2 SCR 257.
Limitation
Lien-Holder’s Caveat
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A lien is not defined under the NLC. A lien under the NLC may
be described as a statutory lien which may be governed by the
terms and conditions of a loan agreement and any other security
document executed between the proprietor and the lender.
Section 281(1) of the NLC provides for the entry of a statutory
lien as follows:
281(1) Any proprietor or lessee for the time being may deposit
with any other person or body, as security for a loan, his
issue document of title or, as the case may be, duplicate
lease; and that person or body –
The legal nature and effect of a lien have been explained by the
courts in reported cases. In Hong Leong Finance Bhd v. Staghorn
Sdn Bhd [2005] 2 CLJ 1 where James Foong J (as he then was),
in delivering the judgment of the Court of Appeal, said at p. 17:
Thus it is material in the creation of a lien holder’s caveat under
s. 281 NLC to have the registered proprietor to deposit the
document of title to the lender for it is the registered proprietor
who intends to surrender his rights to the lender to deal with the
said land in the event of default in repayment of the loan which
he obtained from the lender. As a borrower, no other person can
substitute the registered proprietor in performing this task of
depositing the document of title with the lender for the creation
of this statutory instrument. To allow this would defeat the
concept of the right of the registered proprietor to deal with his
own land. Section 281 NLC is intended for a registered proprietor
to raise money on loan, speedily, by depositing the document of
title registered in his name with the lender as compared with the
more complex process of registering a legal charge over the land.
But as the law demands, it is only available to a registered
proprietor who borrows money and deposits his title with the
lender. It does not extend a beneficial owner who is yet to
become a registered proprietor. Since this facility is only available
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to the registered proprietor, in the event of default in repayment
of the loan, judgment must be obtained against the registered
proprietor, as borrower. The wordings in s. 281(2) NLC of a
“holder of any lien has obtained judgment for the amount due to
him” is clear to this effect for there can be no one else other than
the registered proprietor who is the borrower.
The lien-holder, ie, the person with whom the document of title
or duplicate lease is deposited, may then apply under s. 330(1)
and (2) of the NLC in the duly attested Form 19D to the
Registrar, accompanied by the relevant title or lease and the
prescribed fee, for the entry of a lien-holder’s caveat. If at the time
of receipt of such an application, there is no prohibition by a
Registrar’s caveat, private caveat, trust caveat or prohibitory order,
the Registrar shall enter the caveat under s. 330(3)(a) of the NLC
and serve notification in Form 19A on the proprietor or lessee.
[2013] 1 CLJ Current Law Journal xliii
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retains possession of the issue document of title and has not done
any act prejudicial to his right. Thus, a purchaser or chargee of
land, the issue document of title to which the vendor/proprietor
cannot produce or account for, is put on notice because the
document of title may be deposited with a lien-holder who omits
or fails to enter a lien-holder’s caveat.
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than exactly what it says, that is, a lien on the ground that the
first defendant had deposited with the plaintiffs the issue document
of title and that is substantial evidence of an intention to create a
lien. Therefore, the nature of the plaintiff’s interest in the land is
a lien, which has been held in Ngan Khong v. Bamah as
“analogous to an equitable mortgage”. It is an equitable interest
in land capable of being caveated. (See also Arunasalam Chetty &
Ors. v. Peah Ah Poh & Ors.). The ground on which the claim is
based is also evident from the caveat. It is in effect in the nature
of collateral security for the loan.
Enforcement
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to it) is not avoided also, provided of course it complied with the
law.
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Therefore, prima facie the applicants who are prior in time must
succeed unless it can be shown that he had relied on something
tangible and distinct having grave and strong effect to accomplish
the purpose: see Shropshire Union Railway and Canal Co. v. The
Queen. In the present case the substantial complaint against the
applicants is that they had failed to register the caveat before the
act of bankruptcy was committed. That, as had been perceptively
said in Shropshire Union case is not conduct of a character “which
would operate and enure to forfeit and take away the pre-existing
equitable title.” The applicants had not parted with the documents
of title. They retained possession of them all the time and it is
open to them to register the caveat at any time. In my judgment,
they had done nothing to forfeit their priority.
In Standard Chartered Bank v. Yap Sing Yoke & Ors [1989] 1 CLJ
530; [1989] 2 CLJ (Rep) 500, where the parties thought to effect
a registered charge, but due to the absence of a quit rent receipt
the charge could not be registered. The documents were returned
to the chargee’s solicitors where a clerk kept them safe, although
neither the chargee nor the solicitors knew of the non-registration.
[2013] 1 CLJ Current Law Journal xlvii
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was not entitled to lodge the caveat on 11 June 1985, then the
plaintiff’s charge in equity remains good and unaffected by the
action of the second defendant. It follows, therefore, that any
prohibitory order issued at the instance of the second defendant
was of no effect because a prohibitory order upon entry has a
similar effect to that of a private caveat and neither can it affect a
prior claim (see Tenure and Land Dealings in the Malay States by
David Wong, p. 469 and Karuppiah Chettiar’s case [1971] 2 MLJ
116 where it was decided that the prohibitory order did not affect
the equitable interest prevailing first in time). On the other hand
the plaintiffs caveat on 4 March 1987 was properly lodged and
registered to protect his interest. The question of delay in this
connection is therefore not relevant. The result would be the same
if reliance is placed on my second observation that at the worst
the plaintiff must have a better claim to the land as he had the
issue document of title all the time in his possession.
In Bank of Tokyo Ltd v. Mohd Zaini Arshad & Anor [1991] 2 CLJ
989; [1991] 2 CLJ (Rep) 341, Lim Beng Choon J also dealt with
the question of priority resulting from the failure of the bank as
lender and assignee of a parcel in a building assigned absolutely
xlviii Current Law Journal [2013] 1 CLJ
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is sold pursuant to an order of the Court made by virtue
of sub-section (2) of section 281 –
Trust Caveat
Meaning Of Trust
The NLC does not define what a trust is. Section 5 of the NLC
excludes a wakaf created under the principles of Muslim law.
Under s. 3 of the Trustee Act 1949, “trust” and “trustee” extend
to implied and constructive trusts, and to cases where the trustee
[2013] 1 CLJ Current Law Journal xlix
A trust need not be in writing provided the words are clear and
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unequivocal and irrevocable. In Wan Naimah v. Wan Mohamad
Nawawai [1972] 1 LNS 164; [1974] 1 MLJ 41 where Suffian CJ
(as he then was), in delivering the judgment of the Federal Court
upholding the High Court’s decision that the appellant held the
half share of the land in trust for the respondent, said at p. 41:
The law is that a declaration of trust may be made quite
informally, provided that the words used are clear and
unequivocal. As was stated by Romilly M.R. in Grant v. Grant 55
ER 776, words declaring a trust
His Lordship further held in Wan Naimah’s case that the English
Statute of Frauds 1677 does not apply to land matters.
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beneficiary whose trustee is acting fraudulently can request the
Registrar to enter a Registrar’s caveat.
Section 332(2) of the NLC requires that the effect of any trust
caveat must be precisely stated and the caveator must spell out
the extent to which the land or interest is to bound. The caveator
[2013] 1 CLJ Current Law Journal li
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charges (s. 241 to 281 of NLC) and easements (s. 282 to 291 of
NLC) which directly affect the trust property. A tenancy exempt
from registration may be granted over trust property in accordance
with the terms or conditions set out in the trust caveat. In respect
of a lien-holder’s caveat, a lien may be entered notwithstanding
the presence of the trust caveat if that latter caveat does not so
prohibit. The proviso of s. 332(2) of NLC provides that the trust
caveat is not effective to prohibit the registration of a dealing or
the endorsement of the tenancy or entry of the lien-holder’s
caveat if the instrument was presented for registration or the
application for endorsement or entry received prior to the trust
caveat. A trust caveat will not prohibit the entry of a private
caveat, as a private caveat is not an instrument of dealing.
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of:
(a) the trustee for the time being of any land or interest;
or
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has been expressly or impliedly devised and bequeathed under a
trust created for his benefit. The words ‘any such land or interest’
appearing in the said para (b) seems to relate back to the land or
interest mentioned in para (a) of s. 323(1); otherwise the word
‘such’ is meaningless. That being the position a beneficiary in
order to be a person entitled or beneficially interested (must show
that he is a person entitled or beneficially interested) in the land
held under trust for him.” In Wu Shu Chen [1997] 2 MLJ 487
appellants claimed by a trust instrument dated 2 July 1963
executed by one Mr. Long, he held the land in question on trust
for Mingshu Syndicate, but the registration of Long as trustee
and the deposit of the trust instrument were never done. No trust
caveats were entered. The appellants entered private caveats. On
the application of the respondent as bona fide purchaser for the
land and having the full purchaser price and as the person
aggrieved under s. 327(1) of the NLC, the private caveats were
removed by the courts.
liv Current Law Journal [2013] 1 CLJ
Prohibitory Order
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in conjunction with O. 47 on writs of seizure and sale under the
Rules of Court 2012. As we are dealing with land under the
NLC, we need only concern ourselves mainly with the provisions
of O. 47 rr. 6 and 7 of these Rules dealing with the sale of
immovable property. These provisions are more comprehensive
than those of O. 47, r. 7 of the now repealed Rules of the High
Court 1980, which in turn under O. 93 thereof repeal the Rules
of the Supreme Court 1957 and the Probate and Administration
Rules 1961.
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(2) The effect of any such order duly entered as aforesaid and
expressed to relate to a particular interest only shall, subject to
sub-section (3) of this section and to sub-section (2) of section
337, be to prohibit so long as it continues in force the
registration, endorsement or entry on the register document of -
Ceasure Of Effect
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for unpaid income tax against the vendor who had sold the lands
to the appellants who as purchasers had paid the full purchase
price and obtained the transfers, issue documents of title to the
lands, and possession of the lands. The vendors were held to be
bare trustees of the lands for the benefit of the appellant
purchasers. In setting aside the prohibitory orders, Ong Hock Sim
FJ, in delivering the unanimous judgment of the Federal Court,
said at p. 48:
As we are of the view that the caveat was wrongly entered, we
are also of opinion that the Registrar ought to have registered the
documents when presented on December 14, 1972 and the
prohibitory orders lodged on December 27, are therefore
inconsequential and ineffective, and must be set aside.
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the said property. The protection which the respondent has in the
present case is for lodgment of a private caveat or, if he is a
judgment creditor, to apply to court for a prohibitory order under
Section 335 of the National Land Code. In the case of the former,
it is for him to establish that he has a caveatable interest in the
said property. As none of the above applies in the present case, I
find that the Registrar of Land Titles was wrong in registering
the said order of court as a prohibitory order nor is there any
provision in the National Land Code for an injunction order to be
registered on the title to the said property binding against all and
sundry.
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It is not uncommon for caveat and injunction to exist side by
side. Together, they give a complete safeguard. In Walsh v.
Alexander [1913] 16 CLR 293 where the defendant agreed to sell
the plaintiff a certain homestead selection but subsequently
repudiated the agreement, an order for specific performance was
made and an injunction in terms was also granted. On appeal
Barton ACJ said at p 303:
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seeking a separate and distinct remedy as against the chargor for
interim preservation of the subject matter in order to preserve the
status quo until his claim is adjudicated upon. If, in certain
circumstances, as against the same party, a plaintiff may be
entitled to both a caveat and an injunction (see Manilal & Sons
(M) Sdn Bhd. v. M Majumder [1991] 3 CLJ (Rep) 264 305), I
fail to see why, having failed to resist removal of a caveat by one
party, a plaintiff may not, in appropriate circumstances, obtain an
order whose object is to ensure interim preservation of the subject
matter of the litigation against another party.
Eventually, the plaintiff, Mr. Tan Lay Soon, lost his case in the
Supreme Court in the appeal by the vendor in Kam Mah Theatre
Sdn Bhd v. Tan Lay Soon [1994] 1 CLJ 1 on the ground that
there was no binding contract. Peh Swee Chin SCJ, in delivering
the judgment of the Supreme Court making observation on the
expression ‘usual terms and conditions’, said at p. 6:
We were of the view that there was no contract at all, because
we found that the said document was dependent on the signing
of a formal contract to be further negotiated and approved by
both parties. On this ground alone, we would allow the appeal.
lx Current Law Journal [2013] 1 CLJ
That other ground for finding that there was no contract at all
was that the words in the said proviso – “usual terms and
conditions” failed to reveal certainty they were too ambiguous.
In Foo Poh Sang & Ors. v. Yuen Lum Sdn Bhd & Intervener [1989]
1 CLJ 440; [1989] 1 CLJ (Rep) 547, an interlocutory injunction
in the form of a Mareva injunction designed to stop the defendant
from dissipating its assets, which included the land in question,
was allowed by the High Court even though a caveat entered by
the plaintiff had been removed in earlier proceedings. While the
right of a registered chargee to apply for an order for sale will be
protected by varying an injunction obtained subsequently in
relation to the charged land, the court will not set aside the
injunction wholly where to do so would be to prejudice the rights
which are sought to be protected. In the concluding paragraphs
of his judgment, Peh Swee Chin J (as he then was) said at p. 551:
In view of what has been stated above and especially the fact that
both parties appeared and professed to treat the injunction in
question as one of Mareva’s type with which I also agreed, the
submission about the removal of the caveat in question involving
ipso facto the discharge of the interlocutory injunction fell to the
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ground.
Their Lordships have already noted the analogy between the effect
of a caveat and that of an interlocutory injunction obtained by the
plaintiff in an action for specific performance of a contract for the
sale of land restraining the vendor in whom the legal title is vested
from entering into any disposition of the land pending the trial of
the action. The Court’s power to grant an interlocutory injunction
in such an action is discretionary. It may be granted in all cases
in which it appears to the Court to be just and convenient to do
so. Similarly in s. 327 it is provided that “the Court ... may
make such order on the application as it may think just”. The
guiding principle in granting an interlocutory injunction is the
balance of convenience; there is no requirement that before an
interlocutory injunction is granted the plaintiff should satisfy the
Court that there is a “probability”, a “prima facie” case or a
“strong prima facie case” that if the action goes to trial he will
succeed; but before any question of balance of convenience can
arise the party seeking the injunction must satisfy the Court that
his claim is neither frivolous nor vexatious; in other words that
the evidence before the Court discloses that there is a serious
question to be tried (American Cyanamid v. Ethicon Ltd. [1975]
AC 396).
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In the case of a refusal by the vendor to complete a contract for
the sale of land the normal remedy of the purchaser as plaintiff in
an action is an order for specific performance of the contract; and
in the absence of special circumstances, if it were shown that the
vendor threatened to dispose of the land while the action was still
pending, the balance of convenience would be in favour of granting
an interlocutory injunction to prevent his doing so, provided that
the plaintiff would be in a position to satisfy his undertaking as
to damages if the action should fail at trial.
Likewise, Peh Swee Chin J (as he then was) in Foo Poh Sang &
Ors v. Yuen Lum Sdn Bhd & Intervener [1989] 1 CLJ 440 at
pp. 444-445 said:
Finally, I will deal now with the major submission of intervener
that that the injunctive order in question was a caveat in the guise
of an injunction and once the caveat was removed, the injunctive
order could not remain.
lxii Current Law Journal [2013] 1 CLJ
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The similarities between a caveat and an interlocutory injunction
concerning land lie mainly in the matter of the balance of
convenience which was itself explained by learned Lord Diplock
in American Cyanamid v. Ethicon Ltd. [1975] AC 396. The matter
of balance of convenience arises when a court hears an application
until final trial for example, for extending a caveat or continuing
or applying for an interlocutory injunction.
Undertaking As To Damages
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and on the final disposal of the civil suit or appeal, the land has
depreciated substantially in value.
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applicant was not entitled, in the first place, to the injunction. It
is always possible that a wrong decision would be made at the
interlocutory stage …
Appeals
(d) where, by any written law for the time being in force, the
judgment or order of the High Court is expressly declared
to be final.
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interest), leave to appeal is required. The application for leave is
made by notice of motion in Form 4 under Rule 27 of the Rules
of the Court of Appeal 1994, supported by affidavit. The Court
of Appeal does not give leave to appeal lightly, unless it can be
shown that the court below had erred. The Court of Appeal has
the discretion whether or not to grant leave to appeal. Note the
wording of s. 68(1)(a), ie, “the amount or value of the subject-
matter of the claim (exclusive of interest) is less than two hundred
and fifty thousand ringgit” (previously less than RM100,000 before
amendment). So if the claim is over RM250,000 and the actual
award made by the court is less than RM250,000, no leave of the
Court of Appeal is required. This is the decision in Yai Yen Hon
v. Teng Ah Kok & Sim Huat Sdn Bhd & Anor [1997] 2 CLJ 68,
where Chong Siew Fai CJ (Sabah and Sarawak), in delivering the
judgment of the Federal Court, said at p. 76:
Having regard to the wording in proviso (a) of s. 68(1) of the
Courts of Judicature Act 1964 and in the light of the authorities
cited above, I am of the view that since the claim of the first
plaintiff/appellant was well over RM100,000, he was entitled to
lxvi Current Law Journal [2013] 1 CLJ
appeal without leave even though the trial Court had awarded
RM62,400. In my view, the effect of s. 68(1)(a) of the Courts
of Judicature Act 1964 (as it was then in force) was that if the
amount or value of the subject matter without leave. To render it
necessary that leave should obtained, the amount or value would
have to be less than RM100,000. There might well be cases
where the sums adjudged may be validly taken into account; the
instant appeal before us, however, is not one such case.
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the end of the road for the applicant. The Federal Court has no
power to grant leave to appeal to the Court of Appeal. See Auto
Dunia Sdn Bhd v. Wong Sai Fatt & Ors [1995] 3 CLJ 485, FC,
where Hj Lamin bin Hj Mohd Yunus PCA said at p. 492:
But the case before us was in the nature of an application to the
Federal Court and not an appeal from the Court of Appeal. The
applicant/appellant in the said application was asking the Federal
Court for leave to appeal to the Court of Appeal. There is
nothing in the Courts of Judicature Act making provision for such
an application. To put it simply that if an appeal is to be lodged
in the Court of Appeal in the circumstances falling within the
terms of s. 68(1)(a) leave must first be obtained from the same
Court. Likewise s. 96(a) dictates that before a notice of appeal
can be filed in the Federal Court, its leave must first be obtained.
The Federal Court has no power to grant leave for the purpose
of lodging an appeal in the Court of Appeal.
[2013] 1 CLJ Current Law Journal lxvii
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Bhar (supra) the High Court ordered specific performance of a
contract for sale of land against the appellant. His appeal was
challenged for being incompetent for failure to obtain leave
although the value of the subject matter was less from
RM250,000. The appeal was dismissed by this court for being
incompetent as the value of the subject matter of the order of
specific performance was the purchase price of the land which
was RM99,000 and no leave was obtained from the Court of
Appeal. Our case is no different except the relief sought was for
a declaration.
[33] The notice of motion in encl. 10a for leave to appeal under
s. 68(1)(a) of the Courts of Judicature Act 1964 filed at the
eleventh hour not be entertained and it should be dismissed
forthwith. For these reasons, I will now make those orders as
made by my learned brother Tengku Baharudin Shah bin Tengku
Mahmud JCA.
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read as the amount or value of the claim filed in the civil suit
and not the judgment amount granted against. That would be the
determinant factor in deciding whether leave was necessary.
[16] However the value of the subject matter of the claim (half
share of the disputed property) as pleaded in the amended
statement of defence was RM248,500, which was the same value
assessed for estate duty in the schedule to the Letters of
Administration issued to the respondent (see p. 417/451 appeal
record vol. 5) dated 26 August 1997. This valuation had been
accepted by the learned trial judge and subsequently by the Court
of Appeal. As this would be the concurrent findings of facts by
the courts below we would be slow to interfere with such
findings.
[17] This court in Lam Kong Company Ltd. v. Thong Guan Co. Pte.
Ltd. [2003] 3 CLJ 769 held that the legal authority to decide
whether leave is required or not under s. 68(1)(a) of the Act is
the Court of Appeal and it follows that the decision of the Court
of Appeal is final.
[2013] 1 CLJ Current Law Journal lxix
[21] The time for determining the current value of the subject
matter of the claim (exclusive of interest) as raised in Question
No. 2, would be the time of filing the claim. (See Yai Yen Hon v.
Teng Ah Kok & Sim Huat Sdn Bhd & Anor, supra).
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involving the application of the principles of natural
justice.
(c) Injunction.
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appellant shall file the copy of the documents together with
the memorandum of appeal as supplementary records of
appeal within three weeks of being notified of its availability.
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month from the date on which the decision appealed against was
given, or within such further time as may be allowed by the
Court.
Note s. 96(a) of the CJA contains two limbs and the word or,
indicating there are two different situations or alternatives. To
cross the threshold for leave the applicant must satisfy the first
limb on “a question of general principle decided for the first time”,
or the second limb on “a question of importance … and a
decision of the Federal Court would be to public advantage”. The
case of the applicant for leave will be stronger if he satisfies both
the limbs. In the often cited case of Datuk Syed Kechik Syed
Mohamed & Anor v. The Board of Trustees Of The Sabah Foundation
& Ors [1999] 1 CLJ 325, Edgar Joseph Jr FCJ, in delivering the
judgment of the Federal Court, said in his summing up at p. 335:
To sum up, without prejudice to the generality of what we have
thus far said, the Federal Court exercises its sensitive power to
grant leave to appeal in civil cases sparingly and will not grant
such leave unless both of the following criteria are satisfied by an
intending appellant:
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there is a prima facie case for success in the appeal.
[2] This appeal was previously heard by this court which had,
on 13 May 2005, allowed the appeal of the appellants with costs.
Upon an application for a review of the judgment by the
respondent under r. 137 of the Rules of the Federal Court 1995
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the orders made were set aside and the appeal was ordered to be
reheard. This is the rehearing of the appeal. The first, second and
third appellants are the staff reporter, editor and publisher
respectively of The New Straits Times. The respondent is an
advocate and solicitor practicing under the name and style of
Messrs V Muthusamy & Co and was at one time a member of
the Penang State Assembly.
[23] It is also clear from the section that the cause or matter
must have been decided by the High Court in its original
jurisdiction. The legal issue posed to this court may have arisen
from the decision of the High Court in exercise of its original
jurisdiction or in the Court of Appeal in the course of its giving
its judgment or making its order under the first limb and must
be questions of general principles. Under the first limb, that
decision by the Court of Appeal must however have raised a
question of law which is of general principle not previously
decided by this court. If it has been so decided then that decision
become a binding precedent in which case there is no need for
leave to be given on that question. Alternatively the applicant must
show that the decision would be to public advantage. In my
opinion the fact it would be public advantage must necessarily
involve further arguments before this court. Also because it is to
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be decided by this court the words ‘further argument’ and a
decision of the Federal Court used in that subsection are, to me,
superfluous. There must necessarily be further arguments and the
Federal Court must also make a decision. What is important is
that the decision answering the questions would be to the public
advantage. In England, they use the term ‘a point of law of
general public importance’ (s. 1 of the Administration of Justice
Act 1960). What is important to the public must also necessarily
be an advantage to be decided by this court.
[26] I find that the guidelines set by Joceline Tan rather too strict
which may defeat the objective of s. 96(a). In any case I do not
agree with the interpretation given in that case that there must
have been two inconsistent judgments of the Court of Appeal
before leave could be given. In my opinion there need not had
been two or more previous decisions of the Court of Appeal on
the same issue. In my experience to find such a situation is going
to make it extremely difficult for the intended appellant to obtain
leave to appeal. Section 96(a) does not impose such a restriction
and it is not for the court to do so.
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relevant to the parties, leave should not be granted.
...
[33] The upshot of all what I had said above, I therefore accept
the principles in Syed Kechik and reject those additional conditions
set by Joceline Tan.
In 2005, in Chan Yock Cher v. Chan Teong Peng [2005] 4 CLJ 29,
the Federal Court (consisting of Ahmad Fairuz FCJ (as he then
was), Abdul Hamid bin Mohamad FCJ (as he then was), and PS
Gill FCJ) unanimously dismissed a r. 137 application. In delivering
the judgment of the Federal Court, Abdul Hamid Mohamad FCJ
(as he then was) said on the law at p. 35:
Regarding the law, it must be noted that neither the Federal
Constitution nor the Courts of Judicature Act 1964 (CJA 1964)
provides that this court has jurisdiction to set aside its earlier
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decision or judgment and to direct that the case (or appeal) be
reheard, reconsidered and re-decided. The provision that is usually
relied on, as in this case, is r. 137 of the RFC 1995.
The prevailing view of the Federal Court is that r. 137 does not
confer the Federal Court with unlimited power to review its earlier
decisions. Rule 137 should remain to prevent injustice in an
exceptional and deserving case like quorum failure or lack of
jurisdiction. The safeguard against abuse of r. 137 rests solely with
the Federal Court which will only exercise its power under r. 137
in a rare and exceptional case to prevent an injustice. In 2009 in
the Federal Court case of Ong Thye Peng v. Loo Choo Teng & Ors
[2009] 4 CLJ 515, Zulkefli FCJ (as he then was), citing the Asean
Security Paper Mills case [2008] 6 CLJ 523 had made reference
at p. 523 to cases in which the Federal Court had invoked r. 137
as follows:
It must be noted at the outset that r. 137 of the RFC does not
actually confer jurisdiction on the Federal Court to hear any
application or to make any order to prevent injustice or abuse of
the process of the court. Rule 137 cannot be construed as
conferring upon the Federal Court unlimited power to review its
earlier decision for whatever purpose. The court only has the
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limited ‘inherent’ power or ‘inherent jurisdiction’ in order to
maintain its character as a court of justice. His Lordship Zaki
Tun Azmi PCA (as he then was) in the case of Asean Security
Paper Mills Sdn Bhd v. Mitsui Sumitomo Insurance (Malaysia) Bhd
[2008] 6 CLJ 1 has succinctly laid out the limited or exceptional
circumstances where the court has exercised its discretion to
invoke r. 137 at pp 15-16 as follows:
(a) That there was a lack of quorum eg, the court was not
duly constituted as two of the three presiding judges had
retired (Chia Yan Tek & Anor. v. Ng Swee Kiat & Anor.
[2001] 4 CLJ 61).
(b) The application had been denied the right to have his
appeal heard on merits by the appellate court (Megat
Najmuddin bin Dato’ Seri (Dr.) Megat Khas v. Bank
Bumiputra (M) Bhd [2002] 1 CLJ 645).
(d) Where the court making the decision was not properly
constituted, was illegal or was lacking jurisdiction, but the
lack of jurisdiction is not confined to the standing of the
quorum that rendered the impugned decision (Allied
Capital Sdn Bhd v. Mohd Latiff bin Shah Mohd & Another
Application [2004] 4 CLJ 350).
(f) It does not apply where the findings of this court are
questioned, whether in law or on the facts (since these
are matters of opinion which this court may disagree
with the earlier panel) (Chan Yock Cher @ Chan Yock Kher
v. Chan Teong Peng [2005] 4 CLJ 29).
(h) Where bias had been established (Taylor & Anor v. &
Anor [2002] 2 All ER 353).
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process had been corrupted and a wrong result might
have been arrived at. (Re Uddin [2005] 3 All ER 550).
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when circumstances require. It therefore constitutes a
separate exercise and more of rectifying process. The
exercise of that inherent power will only be triggered by an
application made to it, upon which the court could said to
become seized of it. In that sense it could be said to
exercise an inherent jurisdiction.
[18] With respect we are not inclined to agree with some of the
earlier views expressed in some judgments of this court and
those of the Court of Appeal on the futility of the rule. In
our considered view it has its function in view of its
declaratory effect.
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Lek Yan v. Yayasan Melaka [2009] 4 CLJ 665; [2009] 6
AMR 393 and Chu Tak Fai v. PP [2006] 4 CLJ 931). Each
application must be scrutinized carefully and thoroughly to
determine if indeed there is any issue to be considered under
the rule or for the exercise of the inherent power of the
court. (See: Sabah Forest Industries Sdn Bhd v. UNP Plywood
Sdn Bhd [2010] 3 CLJ 779).