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Caveats, Prohibitory Orders And Injunctions Under The National Land Code 1965*
by Datuk Dr. Wong Kim Fatt** Introduction The Malaysian National Land Code 1965 (the NLC), modelled on the Australian Torrens System, came into force on 1 January 1966 and applies to the eleven states of Peninsular Malaysia, the Federal Territory of Kuala Lumpur (with effect from 1 February 1974 P.U. (A) 56 of 1974), and the Federal Territory of Putrajaya (with effect from 1 February 2001, see Federal Territory of Putrajaya (Modification of National Land Code) Order 2001). Before the NLC came into force in 1966, there were seven separate land laws in Peninsular Malaysia, ie, (a) the National Land Code (Penang and Malacca Titles) Act 1963 codifying the land laws of Penang and Malacca, (b) the Federated Malay States Land Code of 1926 (Cap 138) applicable to the four federated states of Negeri Sembilan, Pahang, Perak and Selangor, (c) the five land laws of each of the states of Johor, Kedah, Kelantan, 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 It is interesting to note that under s. 2 of the repealed Johore Land Enactment, the court means the Supreme Court of Johore, and only one form of caveat in Schedule L is provided under s. 55 of this Enactment, where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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* This article is based on a talk given by the writer on Day 1 in a 3-day seminar on Land Development Issues held on 27 November 2012 in Mutiara Hotel, Johor Bahru, organised by Uni-Link Smart Venture Sdn Bhd. I wish to thank Mr. Wong Boon Lee, Mr. Wong Boon Chong and Miss Kelly Yeo Hui Yain for the valuable discussions I had with them on the relevant subjects and authorities. I am solely responsible for the shortcomings of this article which discusses restraints of dealings, injunctions, and the appeal procedures in the Malaysian Courts. ** Advocate & Solicitor Co-founder & Partner, Gulam & Wong

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used in the NLC. To meet modern requirements and for uniformity, it was necessary to have a single Land Code to replace these seven out-moded separate land laws in the States of Malaya before they achieved independence on 31 August 1957. Clause 1 of the Introduction to the Explanatory Statement of the National Land Code Bill published in the Federal Government Gazette on 1 July 1965 reads:
Under the present law of the States of Malaya two quite different systems of land tenure exist side by side: (a) The States of Penang and Malacca retain a system peculiar to the pre-war Straits Settlements (modelled on the English laws of property and conveyancing) whereby privately executed deeds are the basis of title to land; (b) The nine Malay States, by contrast, employ a system based on the principle that private rights in land can derive only from express grant by the State or secondarily from State registration of subsequent statutory dealings.

The purpose of the Bill is stated in cl. 4 of the Explanatory Statement:

The purpose of the present Bill is to remedy this state of affairs 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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Caveat Under The NLC Under s. 5 of the NLC on interpretation, a caveat means a registered caveat. This shows that a caveat is not effective unless registered under the provisions of the NLC. A caveat, when

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registered, will have the particulars of registration, the serial or presentation number, with the date and time of entry, and signed under his seal by the Registrar of Titles in respect of a registry title or the Land Administrator in respect of a Land Office title. Thus a caveat entered under the NLC is an entry or an endorsement on the register document of title under the hand and seal of the Registrar of Titles or the Land Administrator, as the case may be. Unless the caveator gives his consent in writing under s. 322(5)(b) of the NLC, a caveat shall prohibit dealings by the registered proprietor in the land or interest affected. A caveat gives notice on the register document of titles to the world at large as well as protects the existing interests or claims to such interest of the caveator in the land or particular interest affected. A caveat, often described as a temporary or interlocutory statutory injunction, is not an instrument of dealing and it creates no new interest in land. However, when determining the priority of competing claims or equities between the claimants in any dispute concerning the land or interest bound by the caveat, it is material to note that, everything being equal, the first in time prevails. The New Rules Of Court 2012 Effective From 1 August 2012 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. Language Of The Courts

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Under the National Language Acts 1963/1967, in Peninsular Malaysia, the language of the courts is the national language (bahasa kebangsaan), ie, the Malay language. However, currently the language of the courts in the two East Malaysian states of Sabah and Sarawak is the English language. Writs, pleadings, cause papers, orders, and legal documents in the courts in these two states are filed in English and proceedings are still conducted in English. In Peninsular Malaysia, all writs pleadings, cause papers, orders and legal documents filed in the courts, and correspondence with the courts, government ministries and

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departments, shall be in the national language (bahasa kebangsaan), other than the giving of evidence by witnesses. However, all these documents filed in the courts in the national language may be accompanied by their English translations. In practice court proceedings in chambers or in open court are very often conducted in English in the High Court, the Court of Appeal, and the Federal Court in Peninsular Malaysia, and written and oral submissions are frequently made in English in the interest of justice. In these superior courts counsel and judges more often conduct the proceedings in English, unlike in the Subordinate Courts, ie, the Magistrates Court and the Sessions Court where proceedings are virtually conducted in the national language, except the giving of evidence by witnesses. Section 8 of the National Language Act reads:
8. All proceedings (other than giving of evidence by a witness) in the Federal Court, the Court of Appeal, the High Court or any Subordinate Court shall be in the national language: 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 language.

In this connection, it is relevant to refer to art. 152 of the Federal Constitution which reads:
152 National language

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(1) The national language shall be the Malay language and shall be in such script as Parliament may by law provide: Provided that (a) no person shall be prohibited or prevented from using (otherwise than for official purposes), or from teaching or learning, any other language; and (b) nothing in this Clause shall prejudice the right of the Federal Government or of any State Government to preserve and sustain the use and study of the language of any other community in the Federation.

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. (4) Notwithstanding the provisions of Clause (1), for a period of ten years after Merdeka Day, and thereafter until Parliament otherwise provides, all proceedings in the Federal Court, the Court of Appeal or a High Court shall be in the English language: Provided that, if the Court and counsel on both sides agree, evidence taken in language spoken by the witness need not be translated into or recorded in English. (5) Notwithstanding the provision of Clause (1), until Parliament otherwise provides, all proceedings in subordinate courts, other than the taking of evidence, shall be in the English language.

Grounds Of Judgment In English Are Lawful The crucial national language issue concerning the grounds of judgment written in the English language came up for adjudication by the Federal Court in a criminal case in Harcharan Singh Piara Singh v. PP [2011] 6 CLJ 625 in which the Federal Court unanimously held that the grounds of judgment in the English language do not contravene the National Language Act and the court has a wide discretion to conduct proceedings in English or 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.

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In the 1991 issue of the Singapore Journal of Legal Studies, I had the opportunity at pp. 611 and 612 to make the following observations on the language issue:
For over a century, English has been the language, both spoken and written, of the courts in Peninsular Malaysia. The change came when s. 8 of the National Language Act was amended by the National Language (Amendment) Act 1990 which took effect from 30 March 1990 and administratively from 1 June 1990 by Practice Direction of the Chief Justice (Malaya). ... The Bench and the Bar in Peninsular Malaysia are doing reasonably well in the conduct of cases in the National language, especially in the Subordinate Courts. Judges of the High court and Supreme Court are encouraged to write their judgments in the National Language. Some of these judgments and their English translations, have found their way into the law journals. However, it is respectfully urged that Malaysian judges should continue to write their judgments in English so that these may be read and studied in other parts of the world interested in Malaysian laws because their published judgments in the Malay language will hardly be read or understood in the English-speaking world. As long term objective, English should continue to be used, alongside Malay, where justice requires it in the superior courts of the 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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National Language Not Threatened Now looking back the last 55 years since Merdeka Day on 31 August 1957, I am of the view that the secure constitutional position of the Malay language as the national language of Malaysia has never been threatened, and will never be, by the continued use of English in the Malaysian Courts. Malaysians of different races accept the Malay language as the national language of the country. Mastery and use of the English language will be to the benefit of Malaysia and her citizens in the international and domestic scenes, now and in the future.

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Application Of The New Rules Order 1 r. 2 of the Rules of Court 2012 provides as follows:
2(1) Subject to paragraph (2), these Rules apply to all proceedings in (a) the Magistrates Court; (b) the Sessions Court; and (c) the High Court. (2) These Rules do not have effect in relation to proceedings in respect of which rules have been or may be made under any written law for the specific purpose of such proceedings or in relation to any criminal proceeding.

Overriding Objective Of The Rules: Justice It should be borne in mind at all times that the overriding objective of these Rules is justice, as provided in O. 1A reading as follows:
In administering these Rules, the Court or a Judge shall have regard to the overriding interest of justice and not only to the technical non-compliance with these Rules.

Non-Compliance With The Rules

Under O. 2 r. 1(1) mere non-compliance of the Rules of 2012 does not nullify the proceedings. It is significant to note that under O. 2 r. 1(2), the parties must now assist the court to achieve the overriding objective of dealing with the cases justly. Commence By Writ, Or Originating Summons, Or Notice Of Application We should take note that O. 5 of the Rules of 2012 makes provisions for the mode of commencement of civil proceedings by writ or originating summons (rr. 3 and 4). Order 32 r. 1 of these Rules provides that every application in chambers shall be made by notice of application in the new Form 57, replacing, but practically in the same format of, the old familiar summons-inchambers, except the new Form 57 is headed Notice of Application.

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Cases In Which The Rules Of Court 2012 Are Inapplicable Currently, in Peninsular Malaysia, proceedings relating to company winding-up matters may still be filed in the English language. Under the Appendix C (O. 94 r. 2), the Rules of Court 2012 do not apply to the following proceedings under the following laws:
Appendix C List Of Exempted Laws 1. Bankruptcy proceedings 2. Proceedings relating to the winding up of companies and capital reduction 3. Criminal proceedings 4. Proceedings under the Elections Offences Act 1954 5. Matrimonial proceedings 6. Land reference Bankruptcy Act 1967 Companies Act 1965

Criminal Procedure Code [Act 593] Elections Offences Act 1954 [Act 5] Law Reform (Marriage and Divorce) Act 1976 [Act 164]

7. Admission to the Bar

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Land Acquisition Act 1960 [Act 486] Legal Profession Act 1976 [Act 166], Advocates Ordinance of Sabah [Sabah Cap. 2], Advocates Ordinance of Sarawak [Sarawak Cap. 110]

8. Proceedings under the Income Tax Act 1967

Income Tax Act 1967 [Act 53]

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Proceedings Under The New Rules Proceedings relating to caveats under the caveat system, prohibitory orders, and injunctions relating to the NLC should now be taken under the Rules of Court 2012, with effect from 1 August 2012. On the caveat system, there are four types of caveats provided under Part Nineteen on Restraints on Dealing in the NLC. These caveats are the Registrars caveat, private caveat, lien-holders caveats, and trust caveat. Over the last 46 years since the coming into force of the NLC in 1966, there have been many amendments made to the NLC. In the future, there will many more arising under the NLC amendments in order to update the NLC to meet future requirements. Our courts have adjudicated on many disputes and have had many cases decided and reported in the law reports for guidance of the legal profession. The Registrars Caveat Form Of Registrars Caveat The Registrars caveat is now entered by the Registrar in Form 19F (previously Form 7) on the register document of title to any land under specified circumstances. Form 19F provides as follows:

By virtue of the power conferred on me by section 320 of the National Land Code, I have entered a Registrars Caveat on the land held under Title No. ..................... for Lot No. .....*Town/Village/Mukim ... District .. for the following reason: ......... 2. This caveat shall, so long as it continues in force, prohibit the registration, endorsement or entry on that document, of any instrument of dealing, any claim to the benefit of a tenancy exempt from registration and any lien-holders caveat. This prohibition shall apply to any such instrument, claim or application notwithstanding that it was received before this caveat was entered.

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[Form 19F] (Section 320) ENTRY OF REGISTRARS CAVEAT

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Dated the day of .., 20 . .. Registrar/Land Administrator

Definitions Note the following definitions under s. 5 of the NLC:

Court means the High Court in Malaya. Dealing means any transaction with respect to alienated land effected under the powers conferred by Division IV, and any like transaction effected under the provisions of any previous land law, but does not include any caveat or prohibitory order. Registrar means (a) in relation to land held or to be held under Registry title, or under the form of qualified title corresponding to Registry title, or under subsidiary title dependent on a Registry title, a Registrar of Titles or Deputy Registrar of Titles appointed under section 12; (b) in relation to land held or to be held under Land Office title, or under the form of qualified title corresponding thereto, or under subsidiary title dependent on a Land Office title, the Land Administrator. Registry title means title evidenced by a grant or a State lease, or by any document of title registered in a Registry under the provisions of any previous land law. Land Office title means title evidenced by a Mukim grant or Mukim lease, or by any document of title registered in a Land Office under the provisions of any previous land law. Land Administrator means a Land Administrator appointed under section 12, and includes an Assistant Land Administrator appointed thereunder; and, in relation to any land, references to the Land Administrator shall be construed as references to the Land Administrator, or any Assistant Land Administrator, having jurisdiction in the district or sub-district in which the land is situated.

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Prohibitive Effect Of Registrars Caveat Under s. 319(b) of the NLC, so long as the Registrars caveat remains in force, it shall prohibit the registration, endorsement or entry of:
(i) any instrument of dealing; (ii) any claim to the benefit of a tenancy exempt from registration; and (iii) any lien-holders caveat.

The Registrars caveat is more powerful than a private caveat in that it can operate backward to prevent registration of an instrument of dealing under s. 319(b) (i) above like a transfer of land in Form 14A, or the tenancy claim under (ii) above or a lienholders caveat under (iii) above, notwithstanding these documents were presented, but had not been registered or endorsed, prior to the entry of the Registrars caveat. Under s. 319(3), the Registrar has the discretion to waive the prohibition. Circumstances For Entry Of The Registrars Caveat Section 320 of the NLC, as amended in 1979 by Act A444 by the insertion of subsection (1)(ba), now reads as follows:
320 Circumstances in which Registrars caveats may be entered (1) Subject to sub-section (2), a Registrars caveat may be entered in respect of any land wherever such appears to the Registrar to be necessary or desirable (a) for the prevention of fraud or improper dealing; or (b) for protecting the interests of (i) the Federation or the State Authority; or (ii) any person who is in his opinion under the disability of minority, mental disorder or unsoundness of mind, or is shown to his satisfaction to be absent from the Federation; or (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

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(c) by reason of some error appearing to him to have been made in the register or issue document of title to the land or any other instrument relating thereto. (2) Knowledge by the Registrar of the fact that any land or interest therein has been acquired, or is to be held, by any person or body in a fiduciary capacity shall not of itself constitute a ground for entering a Registrars caveat in respect of that land.

Cancellation Of The Registrars Caveat Section 321(3) of the NLC provides as follows:
(3) A Registrars caveat shall continue in force until it is cancelled by the Registrar (a) of his own motion; or (b) on an application in that behalf by the proprietor of the land affected; or (c) pursuant to any order of the Court made on an appeal under section 418 against his decision to enter the caveat, or his refusal of any application for its cancellation under paragraph (b).

Authority Of The High Court

The decision, including any act, omission, refusal, direction or order, of the Registrar or the Land Administrator is subject to the control and order of the High Court in proceedings relating to land. It is the duty of the Registrar or the Land Administrator to comply forthwith with the order of the court under s. 417(1) of the NLC. Appeals To The High Court It is important to note that under s. 418(1) of the NLC, any person or body aggrieved by the decision of the Registrar or Land Administrator has the right of appeal to the High Court within the period of three months beginning from the date of communication of the decision. Unlike O. 3 r. 5 of the Rules of Court 2012 where the High Court has the discretion to extend time, the court has no jurisdiction to extend this statutory period of three months under s. 418(1) of the NLC. See the Federal Court case of Land Executive Committee of Federal Territory v. Syarikat Harper Gilfillan

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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 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 plaintiffs appeal under s. 418 was entered on 29 January 1989. Therefore, I hold that the Plaintiffs appeal was filed out of time and consequently time barred.

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Appeal Procedure The appeal procedure was, before the commencement of the Rules of Court 2012 on 1 August 2012, by originating motion. Under the new Rules of 2012, I am of the opinion that the appeal will be by originating summons under O. 5 r. 4. Section 418 of the NLC reads:
418(1) Any person or body aggrieved by any decision under this Act of the State Director, the Registrar or any Land Administrator may, at any time within the period of three months beginning with the date on which it was communicated to him, appeal therefrom to the Court.

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(2) Any such appeal shall be made in accordance with the provisions of any written law for the time bring in force relating to civil procedure; and the Court shall make such order thereon as it considers just. (3) In this section decision includes any act, omission, refusal, direction or order.

Person Aggrieved In a nutshell, a person aggrieved is one whose legal right or interest is affected by the wrongful act or conduct of another person. Following the Privy Council case of AG of Gambia v. Pierre Sarr Njie [1961] AC 617, Mokhtar Sidin JCA, in delivering the judgment of the Court of Appeal in Wu Shu Chen & Anor v. Raja Zainal Abidin Raja Hussin [1997] 3 CLJ 854, said of an aggrieved person at p. 868:
The Code contains no definition on who is an aggrieved person. To my mind, the word aggrieved must be given its ordinary meaning. To be aggrieved means one is dissatisfied with or adversely affected by a wrongful act of someone. An aggrieved person is therefore a person whose legal right or interest is adversely affected by the wrongful act or conduct of another person or body. The category of aggrieved persons is never closed.

Cases On Registrars Caveat

There are relatively a few cases reported in the law reports on the Registrars 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 Registrars 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

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transaction on 22 September 1972. The Registrars caveat was entered on 11 October 1972 to protect the interest of the Federal Government for recovery of income tax due from the vendor. The Registrar rejected the transfers and other documents presented, after adjudication for stamp duty payment, for registration on 14 December 1972, and informed on 15 March 1973 the applicants that a Registrars caveat had been entered. The applicants lost their case before Pawan Ahmad bin Ibrahim Rashid J, who erroneously held in his judgment (reproduced from p. 32 of the appeal record in Privy Council Appeal No. 38 of 1975):
I am of the view that the legislature clearly had in view the protection of the interests of the Federation or the State authority and because of this, gave the Registrar specific powers under Section 320 to enter a caveat in respect of any land when he deemed it necessary or desirable to do so in the protection of such interests. It might also be mentioned here that the word interests is plural in number and in my view it can be interpreted to include interests other than registrable interests, whereas in Section 323 the word interest is singular in number and includes only a registrable interest. For this reason I am of the opinion that interests such as vested or contingent are also within the purview of Section 320 of the National Land Code, as far as it pertains to the Federation or the State authority.

In The Federal Court

The applicants appealed to the Federal Court in Temenggong Securities Ltd & Anor v. Registrar of Titles, Johore & Ors [1974] 1 LNS 175; [1974] 2 MLJ 45. In allowing the appeal and reversing the decision of the learned High Court Judge, Ong Hock Sim FJ, in delivering the unanimous judgment of the Federal Court, said at p. 47:
We are of the view that the vendor, having parted with their interest in the lands to the appellants, are bare trustees and have no interest in the land over which a valid caveat can be lodged. Respondents counsel tried to make much of clause 1 of the Agreement of August 30, 1972 that the vendor shall sell and purchaser shall purchase and that therefore no rights passed as the agreement was non-registrable and a non-statutory instrument capable of passing title to the appellants. He glossed over the fact that the vendors had done everything that was required of them to transfer the title and had thereby constituted themselves bare trustees for the appellants and had no other or further interest in the lands.

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In The Privy Council The Registrar of Titles appealed to the Privy Council against the judgment of the Federal Court. The Privy Council dismissed with costs the appeal by the Registrar in Registrar of Titles, Johore v. Temenggong Securities Ltd [1976] 1 LNS 135; [1976] 2 MLJ 44, [1976] 2 WLR 951, [1977] AC 302. In delivering the judgment of the Privy Council, Lord Diplock said of the Registrars caveat at [1976] 2 MLJ 44, at p. 46:
A registrars caveat has substantially the same prohibitory effect as a private caveat expressed to bind the land itself. It is entered by the registrar of his own motion by endorsing the register document of title to the land with the words Registrars Caveat Entered and the time of entry. In one respect its effect is more severe than that of a private caveat: it operates to prohibit the registration, endorsement or entry of instruments, claims to exempt tenancies and lien-holders caveats which were received at the registry before the time of entry of the registrars caveat if they have not been already entered on the register document of title by then. On the other hand the registrar may waive the prohibition in any case where he is satisfied that this would not be inconsistent with the purpose for which the caveat was entered.

Note the learned Law Lords concluding opinion on s. 320(1)(b) (ii) that the Registrar was not entitled to enter a Registrars 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

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their part for the entry of a private caveat. Their Lordship accordingly conclude that the interests which the registrar is empowered to protect under s. 320(1)(b) are confined to interests in the land that are recognised by the Code as being either registrable or otherwise entitled to protection. An unsecured creditor of the proprietor of land has no such interest in the land. Even if no contract of sale by Li-Ta to Temenggong had been in existence at the time, the registrar would not have been empowered by s. 320(1) to enter any registrars caveat in respect of Li-Tas land, upon the information which their Lordship have assumed was available to him. Upon this ground they would dismiss the appeal.

If the Registrar were entitled to enter the Registrars caveat for unpaid income tax, then many individual and corporate tax payers will run the risk of having their lands caveated by the Registrar. 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 Registrars 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 Pinang & Anor [1990] 2 CLJ 640; [1990] 2 CLJ (Rep) 369, cancelling the Registrars 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 payers 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 Registrars caveat. He said at p. 598:

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It seems to me that once there is a charge registered in respect of the land, a Registrars 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.

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In Public Bank Bhd v. Pengarah Tanah & Galian & Anor [1989] 1 LNS 159 referred to earlier, a Registrars 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 chargees 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 threemonth period. Private Caveat Sections 322 to 329 of the NLC make provisions relating to 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.

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Nature And Effect Section 322 of the NLC as amended now reads as follows:
322 Nature and effect of private caveats. (1) A caveat under this section shall be known as a private caveat, and (a) may be entered by the Registrar on the register document of title to any land at the instance of any of the persons or bodies specified in section 323;

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(b) shall have the effect specific in sub-section (2) or (3), according as it is expressed to bind the land itself or an undivided share in the land or merely a particular interest therein. (2) The effect of any private caveat expressed to bind the land itself or an undivided share in the land shall, subject to subsections (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 (a) any instrument of dealing executed by or on behalf of the proprietor thereof, and any certificate of sale relating thereto; (b) any claim to the benefit of any tenancy exempt from registration granted by the said proprietor; and (c) any lien-holders caveat in respect thereof; Provided that where the claim is in respect of a part of the land the caveat bind the whole land and where the claim is in respect of an undivided share in the land, the caveat binds the whole of undivided share in the land. [Inserted by Act A1104]. (3) The effect of any private caveat expressed to bind a particular interest only shall, subject to sub-sections (4) and (5), be to prohibit the registration, endorsement or entry on the register document of title of (a) any instrument of dealing directly affecting that interest (including any certificate of sale relating thereto); and (b) where that interest is a lease or sub-lease -

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(ii) any lien-holders caveat in respect thereof.

(i) any claim to the benefit of any tenancy exempt from registration granted directly thereout, and

(4) A private caveat shall not prohibit the registration endorsement or entry of any instrument, claim or lienholders caveat where the instrument was presented, or the application for endorsement or entry received, prior to the time from which the private caveat takes effect.

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(5) A private caveat shall not prohibit the registration or endorsement of any instrument or claim where (a) the instrument was presented or the application for endorsement made by the person or body at whose instance the caveat was entered; or (b) the said instrument or application was accompanied by the consent in writing of that person or body to its registration or, as the case may be, to the making of the endorsement. (5A) No consent of the person or body at whose instance a private caveat has been entered on a part of the land, an undivided share in the land or a particular interest therein is necessary to effect any registration, endorsement or entry of any instrument on the register document of title not affecting the claim relating to the part of the land, undivided share in the land or interest therein. [Inserted by Act A1104].

Cases On Purpose And Effects Of Caveats As early as 1917, in the well-known Australian High Court case of Butler v. Fairclough [1917] 23 CLR 78 Griffith CJ was considering the nature and effect of a caveat. The learned Chief Justice said at p. 84:
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.

In 1976 in Registrar of Titles, Johore v. Temenggong Securities Ltd [1976] 1 LNS 135; [1976] 2 MLJ 44 Lord Diplock said at p. 46 (also at [1976] 2 WLR 951, and [1977] AC 302 at p. 308) on the purpose of a private caveat:
The purpose of a private caveat is to preserve the status quo pending the taking of timeous steps by the applicant to enforce his claim to an interest in the land by proceedings in the courts.

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In 1979 in an appeal from the Federal Court of Malaysia, the Privy Council in the often-quoted case of Eng Mee Yong & Ors v. Letchumanan [1979] 1 LNS 18; [1979] 2 MLJ 212, Lord Diplock has the opportunity to make useful observations on private caveats under the NLC at p. 214:
The system of private caveats is substituted for the equitable doctrine of notice in English land law. By s. 322(2) the effect of entry of a caveat expressed to bind the land itself is to prevent any registered disposition of the land except with the caveators consent until the caveat is removed By s. 324 the Registrar is required to act in an administrative capacity only; he is not concerned with the validity of the claim on which the caveat purports to be based. The caveat under the Torrens System has often been likened to a statutory injunction of an interlocutory nature restraining the caveatee from dealing with the land pending the determination by the court of the caveators claim to title to the land, in an ordinary action brought by the caveator against the caveatee for that purpose. Their Lordship accept this as an apt analogy with its corollary that caveats are available, in appropriate cases, for the interim protection of rights to title to land or registrable interests in land that are alleged by the caveator but not yet proved.

Caveatable Interest

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

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exercise its judicial function to adjudicate on the validity of the entry of the private caveat. According to the long line of authorities, the registrars duty in respect of an application for entry of a private caveat is purely administrative or ministerial.

In the Court of Appeal case of Luggage Distributors (M) Sdn Bhd v. Tan Hor Teng @ Tan Tien Chi & Anor [1995] 3 CLJ 520, Gopal Sri Ram JCA had paraphrased s. 323(1)(a) at p. 547 as follows:
To paraphrase sec. 323(1) (a) of the Code, a private caveat may be entered at the instance of any person or body who claim either: (1) the title to land; or (2) any registrable interest in Land. The parameters of caveatability under s. 323(1) (a) are therefore circumscribed by these words: title and registrable interest. It is only one who makes a claim to either of these in land may enter a private caveat.

In the case of Megapillars Sdn Bhd v. Loke Kwok Four [1996] 4 CLJ 82, Kang Hwee Gee J (as he then was) made the following observations on caveatable interest at p. 90:
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 defendants 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.

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Further, where that interest is claimed through a contract for the sale of land, the contract must be enforceable by the caveator and negotiations for a contract no matter how advanced is not capable of creating a caveatable interest in his favour ( Ayer Hitam Tin Dredging Malaysia Bhd v. Y.C. Chin Enterprises Sdn. Bhd. [1994] 3 CLJ 133). The point is well illustrated by the following passage in the Court of Appeal case of Murugappa Chettiar Lakshmanan (Wasi Tunggal Harta Pesaka M.R.L. Murugappa Chettiar, Simati) v. Lee Teck Mook [1995] 2 CLJ 545 at p. 551:
Until and unless a purchaser has an enforceable contract for the sale of land, he can lay no claim to the title to registered land. A fortiori, he has no interest that is capable of protection by the entry of a caveat (per Gopal Sri Ram JCA).

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 debtors 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 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 caveators 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

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purchaser of shares in a company has also no caveatable interest in the land of the company (see Pembangunan Wang Kita Sdn Bhd v. Fry-Fry Marketing Services Sdn Bhd [1998] 2 CLJ Supp 96). A shareholder or officer of a company does not have a caveatable interest in the land sold by his company, as was held in Hew Sook Ying v. Hiw Tin Hee [1992] 3 CLJ 1325; [1992] 1 CLJ (Rep) 120 where Mohd Azmi SCJ said at p. 127:
Further, once the company has executed the instrument of transfer in Form 14A in favour of the purchaser, and handed over the original document of title, the managing director either as an officer of the company or in his personal capacity as a shareholder has no fiduciary duty to challenge the conduct of the company by means of private caveat for the alleged purpose of protecting his own interest or the interest of other shareholders.

In my article entitled Private Caveats, Entry, Extension and Removal published in INSAF, the Journal of the Malaysian Bar, (2006) XXXV No. 2, at p. 87, I wrote:
Having determined that the applicant has a caveatable interest under s. 323(1) of the Code in the land in question, you may then apply for the entry of a private caveat in Form 19B in accordance with the provisions of s. 323 of the Code. The following points and procedure should be observed: (a) Apply in the prescribed Form 19B, which may be printed or typed. The relevant particulars must be properly completed. (b) Under para 2 of Form 19B, state concisely the grounds of the claim to the title in the land or undivided share in the land or interest therein, and/or further as stated in the supporting statutory declaration. It is important to bear in mind that what the applicant affirms in the statutory declaration may be used against him in any subsequent litigation concerning the caveat. Although the statutory declaration can be affirmed by the advocate and solicitor under para 3(b) of Form 19B, it is advisable for his client to affirm it in order to maintain detachedness on the part of the solicitor. (c) Note the supplementary provisions as to forms and procedure are provided under the Tenth Schedule of the Code. Under para 11 thereof, the signatures of the caveat applicant and the attesting witness should be in permanent black or blue-black ink. Signatures in ball point pens are not accepted. Roller point pens are accepted. It is important to know the practice of the relevant land registry or land office.

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(d) Form 19B, if executed by a natural person, i.e. the caveator or his attorney or the attorney of a company (typically an attorney of a chargee bank whose power of attorney has been registered with the Registrar of Titles or the Land Administrator) requires attestation by one of the qualified person stipulated in the Fifth Schedule, typically an advocate and solicitor in Peninsular Malaysia. Execution of Form 19B by a limited company under its common seal requires no attestation but Form 19B must be accompanied by such documents as the Memorandum and Articles of Association of the Company, its board resolution, its Form 49 and the supporting statutory declaration which may be affirmed by one of its directors. If Form 19B is executed by a director on behalf of the company (see Mahadevan & Anor v. Patel [1975] 2 MLJ 207), the signature of the director requires attestation. (e) Identify the share of the land in column 4 of the Schedule in Form 13A. In most cases, the caveat is to bind the whole (semua in Malay) of the land itself. Sometimes, where the land is registered in the name of more than one proprietor, an undivided share like 1/2 or 1/3, caveat only the undivided share of the particular proprietor involved. (f) Caveating a part of land or a strata title unit requires greater care. Note the new proviso to s. 322(2) of the NLC stating 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.)

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(g) Pay the appropriate registration fees, which vary from state to state [and time to time]. For example, (i) under the Federal Territory of Kuala Lumpur Land Rules 1995, the fee for entry of a private caveat in Form 19B is RM300 per title (item 32),

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(ii) under the Federal Territory of Putrajaya Land Rules 2002 (P.U. (A) 76), the fee for entry of a private caveat under item 29 of Schedule 4 is RM50 per title. (iii) under the Selangor Land Rules 2003, the fee is RM300 per title (item 40), and (iv) under the Johore Land (Amendment) Rules 2002, item 15 (XXVI), the registration fee is RM150 per title. However, where Form 19B contains more than one title the fee for each title after the first title is RM30 per title. As for the solicitors legal costs relating to caveats, these are slightly increased and are provided under the Fifth Schedule to the Solicitors Remuneration Order 2005, which came into operation on 1 January 2006. The remuneration for a solicitor for entry of a caveat is now RM200 for the first title and RM50 for each subsequent title. For the withdrawal of a caveat, it is RM150 for the first title and RM50 for each subsequent title. Please observe the no discount rule of the Bar Council.

Caveator Bound By His Grounds A caveator should remind himself that he is bound by what he has stated in his grounds for the entry of his private caveat, as these grounds may later be used against him. In Teck Hong Development 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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Further Caveat After Lapsing The statutory lifespan of a private caveat under s. 328(1) is six years, unless extended by order of the High Court, or earlier withdrawn or removed. Section 328(1) reads:
A private caveat shall, if not sooner withdrawn under s. 325 or lapsing pursuant to sub-section (1B) of s. 326 or removed by the Registrar pursuant to an order of the Court under s. 327, lapse at the expiry of six years from the time from which it took effect,

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and the entry thereof may be cancelled accordingly by the Registrar, either of his own motion or on an application in that behalf by any interested person or body.

Can a further caveat be entered after lapsing? I am inclined to think that the caveator should be allowed to enter a further caveat to protect the same interest based on the same ground, provided his claim or interest is still subsisting and not barred by limitation. (See Wong: Restraints of Dealings in Land. in The Centenary of the Torrens System in Malaysia. (Malayan Law Journal (1989), and Teo: Further Thoughts on Second Caveats [1990] 3 MLJ cxvi.) That question was answered in the positive by LC Vohrah J in Thevathason s/o Pakianathan v. Kwong Joon [1990] 2 CLJ 308; [1990] 3 CLJ (Rep) 248, where he said at p. 251:
I did not think that both these authorities which were cited in Damodaran v. Vasudeva to support the proposition that a second caveat may not be entered at the instance of the same applicant in respect of the same land and precisely the same grounds under the National Land Code in any way prohibited the entering of fresh caveat even after the lapse of the first caveat based on a different ground or even on the same grounds if it is for the bona fide purpose of protecting the caveators interest in respect of the same land. It was my judgment that if a contrary view was taken 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.

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Failure To Enter Caveat As a rule of prudence, a solicitor should advise the client to enter the private caveat immediately after execution of the sale and purchase agreement. However, failure to enter a private caveat or enter one later in time does not necessarily mean that a purchaser of land or a chargee will lose his equitable interest in the land, which eventually will be converted to a legal interest upon registration of the transfer or charge. In Haroon bin Guriaman v.

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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 1970s, just a few years after the NLC had come into force. At that time I did not know of the Registrars 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 Registrars caveat to be entered against the lands. The High Court refused to remove the caveat. On appeal, the Registrars caveat was ordered to be removed by the Federal Court, which was affirmed by the Privy Council. Much to my relief, Temenggongs 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 appellants 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 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.

The Federal Court applied the Australian case of Butler v. Fairclough in United Malayan Banking Corporation Bhd v. Goh Tuan Laye & Ors. [1975] 1 LNS 187 in which, in the absence of caveats and registrations, the Federal Court found in favour of the appellant bank which had possession of the documents of title. In Ng Kheng Yeow v. Chiah Ah Foo & Ors [1987] 2 CLJ 108; [1987] CLJ (Rep) 254, the Supreme Court held that the entry of a private caveat by one party does not necessarily mean that he has better priority against another who has not as yet lodged one. The court found in favour of the 4th respondent although

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his caveat was later in time than that of the appellant. In delivering the judgment of the court, Lee Hun Hoe CJ (Borneo) said:
The submission of the 4th respondent that he has better equity is well founded. He entered into the sale agreement with the vendor first. He had paid the full purchase price. The vendors had executed the Memorandum of Transfer in favour. Also, most importantly the title deed is in his possession. He had become the beneficial owner. The only thing against him is that he entered the caveat later than the appellant. However, we are satisfied that on the facts he has the better equity.

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.

Withdrawal Of Private Caveats Withdrawal of private caveats poses no difficulty under s. 325 of 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. Removal Of Private Caveats

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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 wellconsidered judgment of Abdul Malik Ishak J (as he then was) in

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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.

Removal Under s. 326 Removal, in my experience, it is often faster for the registered proprietor to remove the private caveat through the Registrar under s. 326. As the applicant is the registered proprietor of the land, the burden shifts to the caveator to show that his caveat should not be removed. See Eng Mee Yong & Ors v. Letchumanan [1979] 1 LNS 18, PC, Hew Sook Ying v. Hiw Tee Hee [1992] 2 MLJ 189, at 194, SC and Pembangunan Wang Kita Sdn. Bhd. v. Fry-Fry Marketing Services Sdn. Bhd. [1998] 5 MLJ 709 at 716. A recent case in point of removal under s. 326 is Urethane Systems Sdn Bhd v. Quek Yak Kang [2006] 6 CLJ 81. In this case, the 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. Removal Under s. 327

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Section 327 of the NLC provides for any person or body aggrieved by the existence of a private caveat to apply to the High Court for an order for its removal. In normal circumstances the caveator must be served with the application for removal. The procedure for removal of a private caveat is regulated by the rules relating to civil procedure, now the Rules of Court 2012 which came into force on 1 August 2012, repealing the Rules of the High Court 1980 which repealed the Rules of the Supreme Court 1957.

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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 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 nonstatutory 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.

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In the Court of Appeal case of Luggage Distributors (M) Sdn Bhd v. Tan Hor Teng @ Tan Tien Chi & Anor [1995] 3 CLJ 520, the court held that as exempted tenants the respondents private caveats were not available to them. In a claim to a caveatable interest, Gopal Sri Ram JCA (as he then was) at p. 535 stated there are three stages involved. The first stage is the examination of the grounds expressed in the application for the caveat. If it appears that the grounds stated therein are insufficient in law to support a caveat, then cadit quaestio , and the caveat must be removed without the necessity of going any further. In the second stage, the caveator must show his claim discloses a serious question meriting a trial. The third stage is to determine where the balance of convenience or justice lies. The caveator must satisfy the three stages before his caveat is permitted to remain. In 1996 in Kho Ah Soon v. Duniaga Sdn Bhd [1996] 2 CLJ 218, the Federal Court ordered the caveat which was removed by the High Court to be restored as there are indeed serious questions for trial. On the onus of the caveator, Peh Swee Chin FCJ, in delivering the judgment of the court, said at p. 223:
It is settled that in a matter of removal of a caveat as between a caveator and caveatee, as in the instance appeal, the onus is on 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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In a pending suit, where the caveator and the caveatee are parties, the removal application was previously made by summonsin-chambers (Woo Yok Wan v. Loo Pek Chee [1974] 1 LNS 192), which should now be made by an application under the Rules of Court 2012.

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For an application to remove a private caveat made by originating summons, see Chi Liung & Son Sdn Bhd v. Chong Fah & Sons Sdn Bhd & Anor [1974] 1 LNS 21; Chiew Sze Sun v. Muthiah Chettiar [1982] CLJ 39; [1982] CLJ (Rep) 423; and Bank Utama (Malaysia) Bhd v. Periamma Vellasamy [2003] 1 CLJ 142 where Azmel J (as he then was) refused to remove the caveat. As the originating summons is retained by the new Rules of Court 2012, this procedure may, in an appropriate case where there is no serious dispute on facts, be used in removing a private caveat. No Further Caveat On Removal A caveator is prohibited from entering further caveats on like claims after removal by the court or the Registrar, as provided under s. 329(2) of the NLC:
(2) where the Court has ordered the removal of any private caveat under s. 327, or has refused an application under subsection (2) of s. 326 for an extension of time with respect to any such caveat, or where the Registrar has removed any caveat pursuant to sub-section (3) of s. 326, the Registrar shall not entertain any application for the entry of a further caveat in respect of the land or interest in question it is based on the like claim as that on which the former one was based.

Caveating Own Land

The provisions in s. 323(1) or any other section in the NLC is silent on the question whether a registered proprietor can or cannot caveat his own land or his interest therein to block a chargees sale or a dealing affecting his land or interest. In the first local case, the question was answered in the negative by LC Vohrah J when he removed the caveat in Eu Finance Bhd v. Siland Sdn Bhd (M & J Frozen Food Sdn Bhd, Intervenor) [1988] 1 LNS 200, following Richmond J in the case of Re An Application by Haupiri Courts Ltd (No. 2) [1969] NZLR 353, at p. 357:
He must go further and establish some set of circumstances over and above his status as registered proprietor which affirmatively gives rise to a distinct interest in the land. In such circumstances it would seem that the fact that he is the registered proprietor of an estate or interest under the Act may not prevent him lodging a caveat.

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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. Damages For Wrongful Caveats An intended caveator must first ensure he has a caveatable interest in the land before entering a private caveat, as a caveator is liable to pay compensation for his wrongful caveat under s. 329(1) of the NLC. In Luggage Distributors (M) Sdn Bhd v. Tan Hor Teng @ Tan Tien Chi & Anor [1995] 3 CLJ 520 Gopal Sri Ram JCA (as he then was) gave the following caution at p. 537:
It is a serious matter to caveat a persons property, and unless a case is properly made out, caveat ought not to be permitted to remain on the register a moment longer than is absolutely necessary.

In the Court of Appeal case of Trans-Summit Sdn Bhd v. Chun Nyook Lin (P) [1996] 3 CLJ 502 Siti Norma Yaakob JCA (as she then was), with whom Shaik Daud JCA and Abu Mansor JCA 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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In Pembangunan Wang Kita Sdn Bhd v. Fry-Fry Marketing Services Sdn Bhd [1998] 2 CLJ Supp 96 Low Hop Bing J (as he then was) ordered removal of the caveat and damages to be paid by the wrongful caveator. The learned judge said at p. 106:
By reason of above, I hold that the defendants entry of the private caveat is wrongful as the defendant had not disclosed a caveatable interest in its application (Form 19B) under s. 323(1) of the National Land Code. Hence the defendant is unable to cross the first hurdle. I order that the private caveat be hereby

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removed forthwith, without the necessity of going further. I also make a consequential order that damages be awarded to the plaintiff, to be assessed by the Registrar of this Court. Costs to be taxed and paid by the defendant to the plaintiff.

Burden To Prove Damages To recover damages, the burden of proving loss or damage rests on the caveatee, ie, the person or body whose land or interest is bound by the private caveat. In practice, the task of proving loss or damage suffered is not always easy. For example, in Mawar Biru Sdn Bhd v. Lim Kai Chew [1992] 1 LNS 22, the defendant land proprietor did not recover any damages as he had failed to prove any loss for the wrongful entry of the private caveat by the plaintiff purchaser. In Plenitude Holdings Sdn Bhd v. Tan Sri Khoo Teck Puat & Anor [1994] 2 CLJ 796, a case concerning wrongful termination of contract for purchase of land, the High Court had awarded a total sum of about RM16 million in damages. On appeal, in Tan Sri Khoo Teck Puat & Anor v. Plenitude Holdings Sdn Bhd [1995] 1 CLJ 15, the Federal Court set aside the judgment of PS Gill J (as he then was) and reduced the huge damages of some RM16 million to a mere RM10 as nominal damages mainly because the land had appreciated in value. In the course of his judgment Edgar Joseph Jr. FCJ said at p. 31:
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.

No Extension If Caveat Cancelled

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In Manian Kandasamy v. Pentadbir Tanah Daerah Raub & Anor [2011] 7 CLJ 583, the Court of Appeal refused to extend the caveat which had been cancelled by the Land Administrator. Zaleha Zahari JCA, in delivering the judgment of the Court of Appeal, said at p. 591:
[15] The popular meaning attributed to the word extend in s. 326(2) of the Code is that it enlarges or gives further duration to any existing right rather than re-vests an expired right. We are in agreement with the judicial commissioner that the courts power to extend a caveat under s. 326(2) of the Code was only exercisable where a caveat is still alive and was no longer exercisable after a caveat had been cancelled.

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[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 appellants 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] 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 partys 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 Macons 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.

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In affirming the judgment of the High Court, the learned Chief Justice said at p. 164:
In the circumstances is it just for the learned Judge to restore the caveat? The answer must depend on the facts and merits of each particular case. On payment of the full purchase price on April 1, 1978 the purchaser obtained the document of Title to the land from the vendor. By paragraph 9 of the affidavit the respondent stated that the issue document of title to the said land has been and is presently in my possession. True no caveat was lodged. It may be that she thought that her interest was sufficiently protected by taking possession of the document of Title and also that her husband was then building the house on the land. Further, the registered proprietor had executed a Memorandum of Transfer as mentioned earlier. The evidence that the appellant had prior notice is overwhelming. We do not think the learned Judge was wrong to refuse restoring the caveat.

Joint-Venture Cases In the Court of Appeal case of Trans-Summit Sdn Bhd v. Chun Nyook Lin (P) [1996] 3 CLJ 502, at p. 506, Siti Norma Yaakob JCA (as she then was), in refusing to extend the private caveat entered in consequence of a joint venture agreement, said:
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.

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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

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piece of land caveated by the defendant. The application of the appellants (plaintiffs in the High Court) to remove the caveat entered by the defendant based on monetary interest in the jointventure agreement (see also Wong Kuan Tan v. Gambut Development Sdn Bhd [1984] 2 CLJ 26; [1984] 1 CLJ (Rep) 441) was dismissed by the High Court and hence the appeal to the Court of Appeal which allowed the appeal and ordered the removal of the caveat. Mokhtar Sidin JCA delivered in the National Language the judgment of the Court of Appeal. File Action Timeously After the entry of the private caveat it is important to note that the caveator must take civil action, in the word of Lord Diplock in the Privy Council case of Eng Mee Yong & Ors v. Letchumanan [1979] 1 LNS 18; [1979] 2 MLJ 212 at p. 215 timeously for specific performance of the contract of sale he alleges had been tried. In other words, the caveator must not delay in filing his civil action against the caveatee for specific performance of the contract. Delay will cause the caveat to be removed by the court with the consequence that the land may be sold by the caveatee to a third party. In Paya Terubong Estates Sdn Bhd v. Pusaka Warisan Sdn Bhd [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.

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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: The matter before me is a simple one. Mr. KS Chung for the plaintiff has raised five serious points. I need only deal with the last one, the fifth point that on the subject of delay. First, I accept the decision in Plimmer Bros v. St Maur [1906] 26 NZLR 294. In that case, Stout, CJ in New Zealand, on an application to remove a caveat, on facts similar to present case, where the defendant had commenced no action against the plaintiff relating to the land in respect of which a caveat was lodged, referred to several reported cases and said It was his duty to commence an action promptly if he considered himself entitled to specific performance Here nothing was done for nearly sixteen months, and then a caveat was lodged. More than a month has elapsed since then, and still no action has been commenced. In my opinion an action for specific performance under such circumstances must be deemed vexatious in my opinion, to prevent a man dealing with his property after such a long delay is so inequitable that the court will not lend its assistance to such a proceeding. Next, there is a Singapore decision of the learned Chief Justice in OS No. 192 of 1979 where he held that a delay of 2 months was sufficient for a caveat to be removed forthwith.

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The importance of timeous action by the caveator is also seen in the judgment of Kang Hwee Gee J (as he then was) in Megapillars Sdn Bhd v. Loke Kwok Four [1996] 4 CLJ 82 where, in removing the caveat of the applicant for his inordinate delay, his Lordship said at p. 93:
The object of a caveat like that of an interlocutory injunction is to provide interim protection to the interest of the applicant who can show that he has a genuine claim on that interest and that the status quo between the parties should be maintained pending the final disposal of his claim at a later date. It follows therefore, that the applicant must pursue his claim timeously in the Court and failure to do so will defeat the privilege of having his caveat being applied against the inalienable right of the registered proprietor to enjoy his land. Thus, where there has been an inordinate delay on the part of the caveator to prosecute his claim against the caveatee, the Court will not lend its assistance to allow him to maintain this caveat to the detriment of the registered proprietor as to prevent a man dealing with his property after such a long delay is so in inequitable. Per Stout, CJ in the New Zealand case of Plimmer Bros v. St. Maur [1906] 26 NZLR 294 cited and approved in the Singapore High Court in Teo Ai Choo v. Leong Sze Hian [1982] 2 MLJ 12, and see Hew Sook Ying v. Hiw Tin Hee [1992] 2 SCR 257.

Limitation

In connection with the question of delay, we must not forget that a claim can be barred by the statute of limitation. Under s. 6 of our Limitation Act 1953, a claim based on contract is time barred after six years from the date of accrual of the cause of action. See judgment of Vernon Ong Lam Kiat JC (as he then was) in Sime Hok Sdn Bhd v. Soh Poh Sheng [2009] 9 CLJ 848, which was affirmed by the Court of Appeal in Sime Hok Sdn Bhd v. Soh Poh Sheng [2012] 1 LNS 641; [2012] 6 MLJ 557, where, in delivering the unanimous judgment of the Court of Appeal, Abdul Wahab Patail JCA said at p. 562:
[13] We accept that the imposition of time limits within which an action is to be taken, without regard to its inherent merits, arises from the Legislature having to draw a balance between the costs and standard of justice of the judicial system that it could provide and the access to justice it seeks to provide. The time limitation

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within which actions for certain classes of claims can be made would ensure that actions are brought in timely manner, while the evidence is available and the defendant has a fair opportunity to answer and to defend himself, and thereby make possible a high standard of justice with decisions based on facts that parties can satisfy themselves as to the correctness thereof with evidence they can check and verify. These must be a definite end point to potential legal liability. It eliminates the injustice of claimants who wait many years to spring an action upon a defendant, who not expecting an action, may have disposed of the evidence he could have relied upon to defend himself.

A claim for recovery of immovable property like land, limitation sets in after 12 years from the date when the cause of action accrued. See s. 9 of the Limitation Act and Wu Shu Chen & Anor v. Raja Zainal Abidin Raja Hussin [1997] 3 CLJ 854, CA at p. 883 where the appellants claim for the land was held to be filed 14 long years out of time. The appellants leave application No. 08-1071996 (J) to appeal to the Federal Court was dismissed on 13 October 1997 in Penang by the Federal Court (Eusoff Chin CJ, Lamin PCA, and Zakaria Yatim FCJ). Lien-Holders Caveat Creation Of Lien-Holders Caveat

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 (a) may thereupon apply under Chapter 1 of Part Nineteen for the entry of a lien-holders caveat; and (b) shall, upon the entry of such a caveat, become entitled to a lien over the land or lease.

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Nature And Effect Of A Lien 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 holders 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 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.

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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-holders caveat. If at the time of receipt of such an application, there is no prohibition by a Registrars 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.

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Section 330(4) of the NLC provides as follows:

330(4) The entry of a lien-holders caveat on any register document shall be effected by the endorsement thereon, under the hand and seal of the Registrar, of the words Caveat (Lien), together with a statement specifying (a) whether the caveat binds the land itself, or a lease thereof only; (b) the person or body on whose application it was entered; (c) the time from which it is effective (being the time of receipt of the application, as noted thereon pursuant to sub-section (3)); and (d) the reference under which the application is filed.

Section 281(1)(b) of the NLC provides that the lien-holder shall upon the entry of such a caveat, become entitled to a lien over the land or lease. Therefore entitlement to the statutory lien takes effect only upon entry of a lien-holders caveat. It is the authors opinion that omission or failure to enter a lien-holders caveat does not necessarily mean that the depositee of the issue document of title will lose his priority to a right to a lien in equity, provided he 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-holders caveat.

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Effect Of Lien-Holders Caveat The effect of a lien-holders caveat is provided under s. 330(5) of the NLC which reads as follows:
330(5) A lien-holders caveat shall, so long as it continues in force, have the like effect as that specified in subsection (2) to (5) of s. 322 in relation to a private caveats, but as if the references in the said sub-section (5) to the person or body at whose instance the caveat was entered were references to the person or body for the time being entitled to the benefit of the lien; and sub-sections (6) and (7) of the said s. 322 shall also apply in relation to a lien-holders caveats as they apply in relation to private ones.

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Nature Of Lien-Holders Caveat There is substantially no difference in principle between a lien under NLC or under s. 134 of the repealed F.M.S. Land Code. In Zeno Ltd v. Prefabricated Construction Company (Malaya) Ltd & Anor [1967] 1 LNS 221; [1967] 2 MLJ 104, Raja Azlan Shah J (as he then was) said of the creation of a lien under the F.M.S. Land Code at p. 106:
The law regarding the creation of a lien under the Land Code is well settled. Under s. 134 of the Code a lien over any land can only be created by the deposit of the relevant issue document of title by the proprietor followed by a caveat by the holder of the lien which requires delivery of the issue document of title with the caveat for a memorial thereto be made. (See Das Torrens System in Malaya, p. 348). In my view, since intention is always a matter of inference from all the relevant circumstances, once the issue document of title is deposited with the depositee that is evidence of intention to create a statutory lien for the purposes of the section.

The learned judge continued speaking on the nature of the interest at p. 107 as follows:
What does the caveat mean? To me, it cannot mean anything else 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 plaintiffs 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.

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Enforcement Between a statutory lien and a legal charge, financial institutions prefer a legal charge under s. 242 of the NLC as a better form of security. A lien-holder is not entitled to apply to the court for an order of sale of the land or lease in question unless and until he has obtained judgment for the amount due to him under the lien, as provided under s. 281(2) of the NLC. If the lien-holder is unable to obtain judgment summarily, sale of the land or lease will

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have to be delayed after judgment is obtained after the trial. It is significant to note that judicial decisions on the repealed F.M.S. Land Code still serve as useful guides. On the question of postponement of a prior equity, Raja Azlan Shah J (as he then was) said in the Zeno Ltd. case [1967] 1 LNS 221; [1967] 2 MLJ 104 at p. 107:
An act which postpones a prior equity arises where a proprietor by his conduct had given a duly executed registrable instrument to the transferee who subsequently mortgaged the land to a bona fide mortgagee. (See Barry v. Heider; Great Western Permanent Loan Co. v. Friesen). In Abigail v. Lapin, the Privy Council held that where the proprietors of land in New South Wales had transferred them to the nominee of the creditor together with the certificates of title but had lodged no caveat, their equity should be postponed to that of the mortgagee because the proprietors had armed their transferee with power to deal with the lands as owner.

In the Federal Court case of Paramoo v. Zeno Ltd [1968] 1 LNS 95; [1968] 2 MLJ 230 Suffian FJ (as he then was) said of a lien and a charge as follows at p. 232:
Here a lien is a separate legal-statutory-lien. It has an independent existence apart from a charge. So if a charge is avoided for noncompliance with some law or other, the lien (not being ancillary to it) is not avoided also, provided of course it complied with the law. Liens over land owned by a company do not have to comply with section 80 of the Companies Ordinance, because that section applies only to charges. Charges are not liens. The charges subject to section 80 are enumerated in subsection (2) and liens are not included in the list.

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Wan Hamzah J (as he then was) in Poomani v. Associated Finance Corporation Sdn Bhd [1974] 1 LNS 115; [1975] 1 MLJ 277 held that the defendant finance company, which gave a loan of $7,000 to the plaintiff to discharge the charge and which had possession of the issue document of title, was entitled to the lien. The learned judge said at p. 278:
From the evidence I have no doubt that the plaintiff as proprietor had deposited (or caused to be deposited) the title deed with the defendants, and while she did so she intended it to be a security for the repayment of the sum advanced by the defendants. In my opinion loan in that section includes any sum which the proprietor has not repay such as the sum advanced by the defendants in this case.

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I think the defendants should succeed also on a ground in equity. Since the money had been advanced by the defendants in order to pay off the money lent by the society as mortgagees, the defendants had become equitable assignees of the mortgagees rights hereunder. For this view support can be found in the judgment in the case of Coptic Ltd. v. Bailey and Another [1972] 1 All ER 1242.

In Mercantile Bank Ltd. v. The Official Assignee of the Property of How Han Teh [1969] 1 LNS 106; [1969] 2 MLJ 196 the bank had failed to enter a caveat but continued to retain possession of the issue document of title. In holding that the banks failure to lodge a caveat under the F.M.S. Land Code did not prejudice its right in equity, Raja Azlan Shah J (as he then was) said at p. 197:
In other words, although failure to lodge a caveat does not entitle the depositee with whom the issue document of title is deposited, to a lien under the Code, he still possess a right to it in equity. He can exercise that right be registering the caveat under section 134 at any time.

His Lordship, after referring to the authorities, concluded that the bank had done nothing to forfeit its priority. His Lordship said further at p. 198:
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.

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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 chargees solicitors where a clerk kept them safe, although neither the chargee nor the solicitors knew of the non-registration.

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A third party then caveated the land in respect of a judgment debt obtained for a debt over goods, subsequently prohibitory orders were entered at the instance of the caveator. The solicitors discovered the unregistered documents and an attempt to register them was prevented by the presence of the caveat. In allowing priority to the chargee on the basis that it had a lien, Lamin J said at p. 507:
On the other hand, the person with whom a issue document of title is deposited like the plaintiff in this case, immediately upon such deposit he acquires an equitable interest. It is not affected by the absence of a caveat. Raja Azlan Shah J, (as he then was) in the case of Mercantile Bank Ltd. v. Official Assignee of the Property of How Han Teh [1969] 2 MLJ 196 at p. 197 said: The registration of a caveat does not confer priority nor does it create new rights. At the worst I would say that a depositee of an issue document of title like the plaintiff must have a better claim to the land than a person without that document in his hand. Assuming that I am right in my understanding of s. 323(1)(a) of the National Land Code in particular with respect to the phrase any right to such title or interest and that the second defendant was not entitled to lodge the caveat on 11 June 1985, then the plaintiffs 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 Chettiars 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.

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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

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by the original purchaser who sold it, without the knowledge or consent of the bank, to the intervenor who entered a private caveat in respect of the land over which the parcel was erected. Following the Federal Court decision in Nouvau Mont Dor (M) Sdn Bhd v. Faber Development Sdn Bhd [1985] 1 CLJ 56; [1985] CLJ (Rep) 231, the learned judge held that the bank had a better equity and that its failure to enter a caveat, as in the Mercantile Bank s case, did not affect its priority over the intervenor. Accordingly, the learned judge found in favour of the bank and ordered that the assignment be enforced by sale by auction of the strata parcel, much to the relief of banks and finance companies. Determination Of Lien-Holders Caveat A lien-holders caveat may be determined by the lien-holder, the Registrar, or the court depending on the circumstances of the case. A lien-holder may by a written notice given to the Registrar withdraw his lien-holders caveat at any time as provided under s. 331(1) of the NLC. Section 331 sub-ss. (2) and (3) of the NLC read as follows:
331(2) Where any land or lease subject to a lien-holders caveat is sold pursuant to an order of the Court made by virtue of sub-section (2) of section 281 (a) any certificate of sale presented for registration by the purchaser thereof shall be deemed for the purposes of this Chapter to have been presented with the consent of the lien-holder; and (b) upon the registration of the certificate, the caveat shall lapse, and the entry thereof be cancelled accordingly by the Registrar. 331(3) The Registrar may cancel any lien-holders caveat upon proof to his satisfaction that all sums due under the lien have been duly paid.

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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

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has a beneficial interest in the trust property and to the duties incidental to the office of a personal representative and where the context admits, trustee includes a personal representative. The meaning of a trust as given in Halsburys Laws of England (4th edn, vol. 48, para. 51) is as follows:
Meaning of Trust. Where a person has property or rights which he holds or is bound to exercise for or on behalf of another or others, or for the accomplishment of some particular purpose or particular purposes, he is said to hold the property or rights in trust for that other or those others, or for that purposes or those purposes, and he is called a trustee. A trust is a purely equitable obligation and is enforceable only in a court in which equity is administered. The trustee holds the property or must exercise his rights of property in a fiduciary capacity, and stands in a fiduciary relationship to the beneficiary. The property affected by a trust, called the trust property or trust estate, must be vested in the trustee, whether the property is a legal estate, a legal right or an equitable interest where the legal title is vested in some other person.

A trust need not be in writing provided the words are clear and 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 Courts decision that the appellant held the half share of the land in trust for the respondent, said at p. 41:

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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 need not be in writing They must be clear, unequivocal and irrevocable, but it is not necessary to use any technical words, it is not necessary to say, I hold the property in trust for you, nor is it necessary to say, I hold the same for your separate use. Any words the donor means, at the time he speaks, to divest himself of all beneficial interest in the property are, in my opinion, sufficient for the purpose of creating the trust. I think that it is also sufficient for the purpose of showing that the trust has been created, if he

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afterwards states that he has so created the trust, though there was no witness except the done present at the time the trust was created (Page 777).

His Lordship further held in Wan Naimahs case that the English Statute of Frauds 1677 does not apply to land matters. Nature Of Trust Caveat The trust referred to in s. 332(1) and s. 333(1) of the NLC (read together with s. 344 of the NLC) means an express trust. An express trust occurs where the owner of property transfers the legal ownership to a trustee and the beneficial interest to a beneficiary. A common example of an express trust is seen in an appointment of a person as a trustee by fellow members of their clubs or societies to hold the land of the clubs or societies on trust for them. Another example of an express trust is seen in the case of a parent purchasing or transferring land to his child below the age of majority. Hence, the land is transferred to a person holding the land as trustee for the benefit of the minor beneficiary pursuant to a declaration of trust or trust deed. When the beneficiary attains the age of majority, the trustee will transfer the land to the beneficiary. A beneficiary of an express trust must use the private caveat to protect his interest, whereas a minor beneficiary whose trustee is acting fraudulently can request the Registrar to enter a Registrars caveat. A trust caveat is inappropriate for use in cases of a resulting trust, implied trust or constructive trust. This is because in a resulting trust, there is no trust deed to be deposited with the Registrar for safe-keeping as required by s. 344(3) of the NLC. In the case of a constructive trust, the beneficiary may apply to the High Court for an order vesting the land in his name as the beneficial owner. The beneficiary of a resulting or a constructive trust can caveat his interest by way of private caveat. Effect Of Trust 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

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in addition can spell out the conditions in which or terms on which the property may be dealt with. Section 332(2) of the NLC essentially reads as follows:
332(2) The effect of any trust caveat shall be precisely stated therein, and may be to prohibit, either absolutely or except subject to conditions, the registration, endorsement or entry of all or any of the following (a) any instrument of dealing, or class or description of instrument of dealing, directly affecting the trust property; (b) any claim to the benefit of any tenancy exempt from registration granted directly thereout; and (c) any lien-holders caveat in respect thereof: Provided that no such caveat shall prohibit the registration of any instrument which was presented prior to the time from which it takes effect, or the endorsement or entry of any claim or lienholders caveat where the application for endorsement or entry was received prior to that time.

A trust caveat prohibits dealings effected under the NLC such as transfers (s. 214 to 220 of NLC), leases (s. 221 to 240 of NLC), 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-holders 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-holders 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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Entry Of Trust Caveat Section 332(1) of the NLC provides that in order to enter a trust caveat, the person claiming to be a trustee must have first registered himself as the trustee of the land. The plaintiff in Bank

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of Tokyo Ltd lwn. Registrar of Titles, Selangor [1990] 1 CLJ 740; [1990] 1 CLJ (Rep) 344 applied to the High Court for the removal of a trust caveat entered by the defendants on the land in question. The second defendant had alleged that he was the trustee of the land. However, there was no endorsement on the register document of title of any evidence of him being a trustee. Abdul Razak J in his judgment held at p. 347 that before a trust caveat can be entered by the first defendant, the second defendant should have first registered himself as the trustee of the land pursuant to s. 344 of the NLC. The second defendant had failed to prove that he had the locus standi to enter the caveat, thus the court ordered the caveat to be removed as the entry was premature. Who May Apply For The Entry Of Trust Caveat? By virtue of s. 333(2) of NLC, an application for the entry of a trust caveat shall be in the prescribed Form 19E, duly attested and accompanied by a statutory declaration and prescribed registration fee to the Registrar. Section 333(1) of the NLC prescribes who may apply for the entry of a trust caveat reading as follows:
333(1) The Registrar may enter a trust caveat on the application of: (a) the trustee for the time being of any land or interest; or (b) the person or body by whom any land or interest is first transferred to trustees; or (c) the person or body by whom any interest is created in favour of trustees; Provided that no application made by virtue of paragraph (b) or (c) shall be entertained unless it is presented to the Registrar with the instrument transferring or creating the land or interest in question.

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The trustees referred to in paragraph (a) above are those in whom the legal estate or the legal interest is vested. The section implies that all or any of the present trustees may jointly apply to enter the caveat. In respect of s. 333(1) (b) and (c) of the NLC, this may refer to the settlor of the trust (the person who created the

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trust). It may also be a person or body dealing with trustees who knows that a trust has been created by another. The proviso of s. 333(1) of the NLC requires that the applicant seeking to caveat under this paragraph must produce the instrument by which the land or interest is transferred by way of trust. There are relatively few cases reported on trust caveat. A case of relevance is Khoo Teng Seong v. Khoo Teng Peng [1990] 2 CLJ 233; [1990] 2 CLJ (Rep) 242 where Lim Beng Choon J in delivering his judgment directed the caveats to be removed and held that a trustee and beneficiary of a trust property may enter a caveat pursuant to s. 323(1)(b) of the NLC, but that a beneficiary entitled only to a share of the residue of any estate, has no right to enter a caveat against the property where no part of the property has been devised and bequeathed. The learned judge said at p. 248:
From the commentaries of the authors of these textbooks and from my reading of para. (b) of s. 323(1), I am of the view that a trustee of property held in trust as well as a beneficiary of any trust property is entitled to enter a caveat pursuant to the said para. (b). But a beneficiary, who is only entitled to a share of the general residue has no right to enter a caveat against the property of the estate when no part of the property of the estate 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.

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Duration And Cancellation Of Trust Caveat Section 333(5) of the NLC provides that a trust caveat shall continue in force until cancelled by the Registrar on an application in that behalf by the trustees for the time being and all persons and bodies beneficially entitled under the trust. Before cancelling the trust caveat, the Registrar may conduct an inquiry to satisfy himself, after hearing the trustees and all the beneficiaries, that it is proper to do so. Prohibitory Order Meaning Of A Prohibitory Order A prohibitory order is not an instrument of dealing under the NLC. Unlike a private caveat which can be entered by a person on his own action, a prohibitory order is issued by the High Court on the application supported by an affidavit made ex parte under O. 47 r. 6(a), (b) and (c) by the judgment creditor who has obtained a money judgment against the judgment debtor in execution of the judgment or order against the land or interest therein of the judgment debtor. Sections 334-339 of the NLC deal which prohibitory orders, read 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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Section 334 of the NLC defines a prohibitory order as follows:

In this Chapter prohibitory order means, where land or an interest in land held by a judgment-debtor is to be sold in execution proceedings, an order made pursuant to rules of court by court of competent jurisdiction prohibiting the judgment-debtor from effecting any dealing therewith or from effecting such dealing therewith as may be specified in the order.

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It may be noted that under s. 335 of the NLC a prohibitory order is ineffective until it has been entered or registered by the Registrar. It should also be noted that under s. 336(3), any instrument like a transfer in Form 14A or a charge or a lienholders caveat presented earlier than the prohibitory order shall not be affected or prohibited from registration. Effect Of Prohibitory Order These effects are provided in s. 336(1) and (2) of the NLC reading as follows:
(1) The effect of any prohibitory order duly entered on any register document of title and expressed to relate to the land itself 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 thereon of (a) any instrument of dealing executed by or on behalf of the proprietor thereof (but not any certificate of sale relating thereto); (b) any claim to the benefit of any tenancy exempt from registration granted by the said proprietor; and (c) any lien-holders caveat in respect thereof.

(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 (a) any instrument of dealing, other than a certificate of sale, directly affecting that interest; and (b) where that interest is a lease or sub-lease (i) any claim to the benefit of any tenancy exempt from registration granted directly thereout; and (ii) any lien-holders caveat in respect thereof.

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Life Span Of Six Months Under s. 338 of the NLC, the life span of a prohibitory order is six months, unless extended by the court on application.

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Ceasure Of Effect Under s. 339(1), a prohibitory order shall cease to have if withdrawn by order of court. See 339(2) of NLC provides for the ceasure as follows:
(2) A prohibitory order shall cease to have effect, and the entry thereof be cancelled accordingly, on the registration of (a) any transfer executed by an officer of a court as mentioned in sub-section (1) of section 337; or (b) any certificate of sale given under sub-section (3) 259 or sub-section (4) of section 265 and relating to the land or interest affected by the order.

Prohibitory Order Set Aside In Temenggong Securities Ltd & Anor v. Registrar of Titles, Johore & Ors [1974] 1 LNS 175; [1974] 2 MLJ 45, the Federal Court heard together the three appeals brought by Temenggong Securities Ltd and another against the Registrar of Titles, Johore, to cancel the Registrars caveat and against the Comptroller of Inland Revenue, Malaysia, to set aside the two prohibitory orders on the lands obtained by the Comptroller based on two judgments 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:

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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.

Order 47 r. 6 Of The Rules Of Court 2012 Where the seizure involves immovable property or any registered interest therein the provisions of O. 47 r. 6(a) to (k) must be observed. Order 47 r. (a) provides for seizure by order of the court to which an application may be made ex parte by a notice of application under O. 47, r. 6(b), supported by an affidavit giving the relevant particulars.

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Order 47 r. 7(f) Sale Of The Immovable Property Order 47 r. 7 provides for the sale of the immovable property or any interest therein to be subject to the conditions stated thereunder. Order 47 r. 7(f) provides for the sale to be set aside on the ground of a material irregularity or fraud. Order 47 r. 7(g) provides for the purchase to make application to the court to set aside the sale on the ground that the judgment debtor had no saleable interest in the property sold. Injunction In Aid Of Caveats Nature And Effect Of Injunction An injunction does not give statutory protection of the purchasers interest under the NLC. There is no provision in the NLC for it to be registered on the register document of title to the land and an injunction is not registrable or indorsable on the register document of title to the land. In Heng Bak Teong & Anor v. Ng Ah Seng [1987] 1 LNS 115; [1988] 1 MLJ 406, Mohamed Dzaiddin J (as he then was) held at p. 408 that:
In my judgment, an injunction does not accord statutory protection of the purchasers interest under the National Land Code and therefore is not registrable or indorsable on the title to 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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As such, it would be more appropriate to apply for the entry of the two kinds of restraint of dealings provided under the NLC, namely (i) caveats or (ii) prohibitory order, to act as a restraint against dealings under NLC. Nevertheless, injunctive relief may still be available to party whose caveat has been removed by the court, notwithstanding that an injunction is not registrable on the register document title of the land. I will deal with this later with some reference to the reported cases.

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The nature of an injunction was stated by KC Vohrah J in MBF Holdings Berhad v. East Asiatic Company (Malaysia) Berhad [1995] 4 CLJ 73 where his Lordship explained that an injunction is an order of the court forbidding the initiation or the continuance of some act or state of affairs or commanding that an act be done. The learned judge said at p. 75:
An injunction, which forbids doing or going on doing an act, for example trespass on the plaintiffs land by parking cars there, is prohibitory. An order which directs the defendant to do something to repair an omission, or, to restore the prior position by undoing a wrongful act such as building in breach of a restrictive covenant, is a mandatory injunction.

Injunction In Aid Of Caveats A plaintiff, having failed to resist the removal of a caveat by one party, may in appropriate circumstances, obtain an order with the object of ensuring interim preservation of the subject matter of the litigation. A plaintiff may be entitled to both a caveat and an injunction. In Manilal & Sons (M) Sdn Bhd v. M Majumder [1988] 1 LNS 16; [1988] 2 MLJ 305, Lee Hun Hoe CJ (Borneo), in delivering the unanimous judgment of the Supreme Court, held at p. 308:
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: It is urged that the respondents caveat sufficiently protects him, and therefore he cannot have an injunction. I do not agree. The caveat does not give the purchaser relief as comprehensive or as direct as he gains by the jurisdiction in personam , and therefore it cannot be held to be the exclusive remedy Isaacs J put it in another way at p 305: ... Mr. Loxton argued that as the legislature has provided for a caveat which effectually prevents a dealing being registered contrary to the agreement, that ousts the ordinary jurisdiction of the court to grant an injunction. There are

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two answers to that. The narrow one is that a dealing by way of transfer or lease or mortgage is not the only method of transgressing the contract. Retention and user and alteration of the property by the defendant himself could not be prevented by a caveat, and these are equally within the dominion claimed by him. But the broader ground is this: that where rights and liabilities are not created by a statute, but arise by common law, then, even though they are affirmed by a statute which gives a special and peculiar form of remedy different from the remedy which existed by common law, yet, unless the statute expressly or by necessary implication excludes the common law remedy, the latter still remains.

The granting of an injunction is always in the discretion of the judge or the court. An injunction is available, in appropriate circumstances, to the plaintiff to ensure interim preservation of the subject matter of a civil suit even though the plaintiff had failed to resist the removal of a caveat (at the instance of the chargee) which he had earlier entered. In Tan Lay Soon v. Kam Mah Theatre Sdn Bhd [1992] 4 CLJ 1922; [1992] 3 CLJ (Rep) 657 where Edgar Joseph Jr J (as he then was) held at p. 663 that:
Accordingly, in my view, the purchaser, having failed to resist the chargees attempt to remove the caveat is not prevented from 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.

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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.

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There was another ground on which we would have equally allowed the appeal. 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 Marevas 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 ground. I therefore as stated earlier, varied the injunctive order so as not to prejudice in any way the intended foreclosure proceedings at instance of the intervener/chargee, but dismissed his application to set it aside wholly.

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Differences Between A Private Caveat And An Injunction The similarities and differences between a caveat and an injunction were explained by Lord Diplock in delivering the judgment of Privy Council in the case of Eng Mee Yong & Ors v. Letchumanan [1979] 1 LNS 18 as follows:
Their Lordships accept this as an apt analogy with its corollary that caveats are available, in appropriate cases, for the interim protection of rights to title to land or registrable interest in land that are alleged by the caveator but not yet proved. Nevertheless their Lordships would point out that the issue of a caveat differs from the grant of an interlocutory injunction in that it is issued ex

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parte by the Registrar acting in an administrative capacity without the intervention of the Court and is wholly unsupported by any evidence at all. 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 Courts 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). 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.

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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.

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The Court could not accede to this submission. In my judgment, there are real though subtle, differences between the two. A caveator, when called upon to justify his caveat, would have to satisfy the Court, (when he is not a registered owner), that he has a caveatable interest in the land in question. Please see Eng Mee Yong v. V. Letchumanan [1979] 2 MLJ 212; Nanyang Development v. How Swee Poh [1970] 1 MLJ 145. Caveatable interest is, of course, very fortunately and conclusively though compendiously set out in s. 323(1) of the National Land Code. On the other hand, an injunction can restrain a person from doing anything, not just concerning land. When it applies to land, it is not dependent on the presence or absence of any caveatable interest for it to issue, such as a Mareva injunction, the requirements of which were discussed earlier. A caveatable interest is, of course, a relevant but by no means sine qua non for an injunction to issue. Just to mention another difference mentioned by the learned Lord Diplock himself in Eng Mee Yong , a caveat is registered by a Registrar of titles always ex parte acting in an administrative capacity and not, if I may myself add, in a judicial or quasijudicial capacity. 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. Again, apart from and before the balance of convenience spoken of above arises, an applicant for an interlocutory injunction or for continuing it must satisfy the Court that there is a serious question to be tried; a question that is not frivolous or vexatious, as regards his claim at the trial for a permanent injunction or other remedy in aid of which the interlocutory injunction is sought. Similarly, an applicant (caveator) for extending a caveat would have to satisfy the Court that there is a similarly serious question for trial as regards his claim to a registrable interest in the land etc. under s. 323 of the National Land Code. Please see His Lordships elucidation of the same in Eng Mee Yongs case.

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Thus, unlike a caveat or a prohibitory order, there are no express provisions for an injunction to be registered under the NLC as a restraint against dealings. An injunction is therefore not registrable under the NLC as a restraint against dealings. It is a form of preventive relief granted in the discretion of the court. Depending on the facts of each case, the court may grant an injunction to restrain the sale and charge of a land to a third party when the vendor has already agreed to sell it to the plaintiff, until after the trial of the action or further order of the court. Undertaking As To Damages In an ex parte application for the issue of an injunction order restraining the defendant from doing a certain thing, such as the sale or disposal of land or any interest therein, the plaintiff/ applicant is required to give an undertaking to pay damages in the event he fails in his action. In such a situation, the applicant must exercise care and ensure that, on the law and facts of the case, his prospects of success are reasonably good; otherwise, when it was eventually shown that the applicant to the ex parte injunction has misled the court or has acted mala fide, he may end up paying huge damages based on his undertaking in the event, for example, the land is not sold at the high price bargained for in the contract, and on the final disposal of the civil suit or appeal, the land has depreciated substantially in value. The purpose of an undertaking as to damages in an application for injunctive relief was well explained by Abdul Malik Ishak J (as he then was) in the case of TSC Education Sdn Bhd v. Kolej Yayasan Pelajaran Mara & Anor [2002] 2 CLJ 581 at p. 615:
Indeed if the interlocutory mandatory injunction was later found to be wrongly granted, the effects on the defendants would be far reaching in view of the nature of the said agreement. Shankar J (as he then was) in Cheah Theam Swee & Anor v. Overseas Union Bank Ltd & Ors [1989] 1 CLJ 157; [1989] 1 CLJ (Rep) 386 emphasised the importance of the applicant to show that he was able to pay damages should the injunction be found to be wrongly granted. At pp 179 to 180 (at pp. 409-410) of the report, his Lordship Shankar J (as he then was) had this to say: In the light of the material before me I was satisfied that the undertaking as to damages given by the first plaintiff was a barren one because although challenged, he had not responded with any evidence of means. The defendants

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evidence was that the delay resulting from the ex parte injunction had coincided with a drastic fall in values in the property market which they put at about $20 million. There is no evidence before me that the market had bottomed out. In this state of affairs it seemed to me that it would have been an exercise in futility for the assistant registrar to embark upon an inquiry as to damages if the plaintiffs were in no position to satisfy them. If they were, then the issue would have arisen as to whether they should pay these damages before the conclusion of the trial or whether they should merely give security for their payment in any event. Once again, unless there was some evidence of means the inquiry would have been an exercise in futility. A bare undertaking as to damages may be usual as to form, but useless as to content unless the plaintiffs are worth powder and shot. I therefore hold it to be the right of the defendants to be told what the undertaking is worth in real terms. What is the real purpose of an undertaking as to damages? It is simply to vest the court with the jurisdiction to make an appropriate order to recompense the loss suffered by the party who was restrained when it is subsequently established that the 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 To me, an undertaking as to damages must be given because if the person is wrongly enjoined, he will hardly have any recourse against the applicant (Attorney-General v. Albany Hotel Company [1896] 2 Ch 696 at p. 699).

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Appeals Civil Appeal To The Court Of Appeal Subject to the provisions of s. 68 of the Courts of Judicature Act 1964 (the CJA), any party dissatisfied with the decision of the High Court in any judgment or order in civil proceedings has the right of appeal to the Court of Appeal, normally consisting of three judges or such greater uneven number of judges as determined by the President of the court (see s. 67 of the CJA). Except with leave of the court, s. 68 of the CJA provides for nonappealable matters and reads as follows:

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68(1) No appeal shall be brought to the Court of Appeal in any of the following cases: (a) when the amount or value of the subject-matter of the claim (exclusive of interest) is less than two hundred and fifty thousand ringgit, except with the leave of the Court of Appeal; (b) where the judgment or order is made by consent of parties; (c) where the judgment or order relates to costs only, which by law are left to the discretion of the Court, except with the leave of the Court of Appeal; and (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.

It may be noted that under s. 68(1) of the CJA, no conditions are stated for the granting of appeals to the Court of Appeal, unlike s. 96(a) of the CJA where an applicant must cross the threshold of one of the two limbs, or both limbs thereof. Principles Involved In Leave Application Where the value of claim is less than RM250,000 (exclusive of 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 subjectmatter 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:

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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

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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.

In United Oriental Assurance Sdn Bhd v. Penang Medical Centre Sdn Bhd [1999] 2 CLJ 583, Abu Mansor JCA, in delivering the judgment of the Court of Appeal on the principles involved in an application for leave to appeal to the Court of Appeal, said at p. 588:
It is trite law and very well settled that an appellate court will not lightly interfere with the finding of the court below unless it can be shown the lower court had erred. In an application to the Court of Appeal where leave is sought, the matter is still dealt with by the principles enunciated in Pang Hon Chin v. Nahar Singh [1986] 2 MLJ 145 where Edgar Joseph Jr J (as he then was) held that leave can only be given where the applicant is able to demonstrate a prima facie case of error. We find no such error.

If leave to appeal is refused by the Court of Appeal, that will be 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.

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More recently in 2010 in Harcharan Singh Sohan Singh v. Ranjit Kaur S Gean Singh [2010] 3 CLJ 29, the Court of Appeal dismissed the application for leave to appeal. What Tengku Baharudin Shah JCA said at pp. 38 and 39 deserves our attention:
[14] The phrase amount or value of the subject matter of the claim in s. 68(1)(a) CJA was considered by the Supreme Court in Yai Yen Hon v. Teng Ah Kok & Sim Huat Sdn Bhd & Anor [1997] 2 CLJ 68 FC and it was held that it must be read as the amount or value of the claim filed in the civil suit and not the judgment amount appealed against, that would be the determinant factor in deciding whether leave was necessary. That was a case where the appellant claimed damages totalling RM4,000,000 arising from an accident but only RM62,400 was awarded and it was held that leave of the court was not required for his appeal. The determinant factor is the value of the subject matter as disclosed in the claim when filed. Applying that test the appellant must necessarily obtain leave of this court to pursue his appeal. [15] As to whether leave was required in the case of claim for specific relief, as in this case for a declaration, s. 68(1)(a) CJA makes no exception for such a case. The said provision is clear and unambiguous see Mohd Tahir Mohd Shariff v. Ramlah Abdullah [2004] 1 CLJ 865. In Amer Mohideen Dawood v. Sneh 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.

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Abdul Malik bin Ishak JCA said in his supporting judgment at p. 44:
[32] Again, this court in Mohd Tahir Mohd Sheriff v. Ramlah bt Abdullah [2004] 1 CLJ 865, where the value of the land, after the initial payment, left a balance of RM98,320 and where the appeal was filed without leave of this court pursuant to s. 68(1)(a) of the Courts of Judicature Act 1964, forthwith struck out the appeal.

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[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.

The Harcharan Singh case went up for decision in the Federal Court in Harcharan Singh Sohan Singh v. Ranjit Kaur S Gean Singh [2011] 3 CLJ 593. In dismissing the appeal, Hashim Yusoff FCJ said in delivering the judgment of the Federal Court at pp. 599 and 600:
[12] We agree with the Court of Appeals decision in Mohd Tahir Mohd Sheriff v. Ramlah Abdullah [2004] 1 CLJ 865 that s. 68(1)(a) of the Act is unambiguous. It clearly states that no appeal shall be brought to the Court of Appeal when the amount or value of the subject matter of the claim (exclusive of interest) is less than RM250,000, except with leave of the Court of Appeal. [13] This appeal therefore hinges on the value of the disputed property. The phrase amount or value of the subject matter of the claim. Section 68(1)(a) of the Act was considered by the Supreme Court in Yai Yen Hon v. Teng Ah Kok & Sim Huat Sdn Bhd & Anor [1997] 2 CLJ 68 where it was held that it must be 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.

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Finally, the Federal Court answered the two questions framed as follows at p. 600:
[20] For the above reasons, we would answer Question No. 1, in the affirmative in that s. 68(1)(a) of the Act still applies when the amount or value of the subject matter of the claim (exclusive of interest) is less than RM250,000. [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).

Matters Where No Leave To Appeal Required Practice Direction No. 1 of 2008 of the Court of Appeal directs that certain matters do not require leave of the Court to appeal. These are:
(3) Matters where leave to appeal is not required Leave to appeal is not required in the following matters: (a) Certiorari in respect of any appeal involving a decision of the Industrial Court, decision of the Disciplinary Board or any body exercising quasi judicial function involving the application of the principles of natural justice. (b) Declaration to declare that the grant of a licence, act omission or decision of a legally authorized body or person is null and void. (c) Injunction. (d) Company Winding-up Petition except an application made under sec. 218(1)(e) and sec. 218(1)(g)(i) of the Companies Act 1965 that involve a total debt which is less than RM250,000. (e) Bankruptcy Proceedings. (f) Matters connected with marital proceedings under Law Reform (Marriage and Divorce) Act 1976. (g) Judgment for unliquidated damages/unliquidated amount.

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Rules Of The Court Of Appeal 1994 Amended Note the Rules of the Court of Appeal (Amendment) 2012 made by the Rules Committee came into operation on 1 August 2012 (P.U. (A) 234). It is essential to comply with the Rules of the Court of Appeal 1994 (as amended) in the filing and service of the notice of appeal, payment of the appropriate filing fees and deposit, preparation, filing and service of the appeal record within eight weeks from the filing of the notice of appeal. Among the several amendments, the new r. 4 now reads as follows:
4. Where no other provision is made by any written law or by these Rules, the procedure and practice in the Rules of Court 2012 shall apply mutatis mutandis.

Attention should be drawn to the amendment of r. 18 of the principal Rules as follows:

(a) in sub-rule (7), by deleting the words or within such further time as the Court may, and (b) by inserting after sub-rule (7) the following sub-rule: (7A) Notwithstanding sub-rule (7), if any copy of the documents specified in paragraph (4)(b), (d) or (e) is not available within eight weeks after the entry of the appeal, the 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.

Court Of Appeal Practice Direction No. 2 Of 2012

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In appeals to the Court of Appeal, the appellants and their solicitors should take note of the courts Practice Direction No. 2 of 2012, issued by the Registrar on 15 October 2012 under reference (3) MR/U/03/1/2012, which states, inter alia, that the application for extension of time to file the appeal record has become irrelevant. The appeal record must be filed within eight weeks after the filing of the notice of appeal. Presumably, after the expiry of the prescribed period stated in the new sub-rule (7A), extension of time may be applied for under O. 3 r. 5 of the Rules of Court 2012, or under the inherent jurisdiction of the court. My rule of caution is to act fast and not to delay till the last day.

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Appeal To The Federal Court There is no right of appeal from the Sessions Court and the Magistrates Court to the Federal Court. See Abdul Ghaffar Md Amin v. Ibrahim Yusoff & Anor [2008] 5 CLJ 1, FC. An appeal from the Court of Appeal to the Federal Court is not as a matter of right. The Rules of the Federal Court 1995 (RFC) and the Practice Directions of the court issued from time to time must be observed. In order to appeal, the applicant must first obtain the leave of the Federal Court on certain questions of law which must be properly framed. The Federal Court need not answer the questions framed (see Ungku Suleiman Abd Majid & Anor v. Pengarah Tanah Dan Galian Johor & Anor [2012] 2 CLJ 273 FC) The applicant for leave to appeal must, as provided under s. 97(1) of the CJA file his application (by notice of motion in Form 6 under r. 66 of the RFC and supported by affidavit) within one month from the date of the decision appealed against or within the extended time allowed by the court, as provided under s. 97(1) of the CJA reading as follows:
97. Leave to appeal (1) An application under section 96 for leave to appeal to Federal Court shall be made to the Federal Court within month from the date on which the decision appealed against given, or within such further time as may be allowed by Court. the one was the

If leave is granted, the notice of appeal must be filed within the period ordered, and the appeal record must be filed under r. 57 within six weeks after the filing of the notice of appeal (Form 3). Notice of cross-appeal in Form 4 may be filed within the prescribed time. The applicant must satisfy the requirements of s. 96(a) of the CJA, reading as follows:
96. Subject to any rules regulating the proceedings of the Federal Court in respect of appeals from the Court of Appeal, an appeal shall lie from the Court of Appeal to the Federal Court with the leave of the Federal Court (a) from any judgment or order of the Court of Appeal in respect of any civil cause or matter decided by the High Court in the exercise of its original jurisdiction involving a question of general principle decided for the first time or a question of importance upon which further argument and a decision of the Federal Court would be to public advantage.

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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: (1) the judgment of the Court of Appeal has raised a point of general principle which the Federal Court has not previously decided or a point of importance upon which further argument and a decision of the Federal Court would be to public advantage; and (2) if the point is decided in favour of the intending appellant, there is a prima facie case for success in the appeal.

The recent judgment of the Federal Court in the landmark case of Terengganu Forest Products Sdn Bhd v. Cosco Container Lines Co Ltd & Anor and Other Applications [2011] 1 CLJ 51 provides the most up to date authoritative guidelines on leave applications. This five-member Federal Court was set up to resolve the inconsistencies in the two earlier judgments of the Federal Court in Datuk Syed Kechik Syed Mohamed & Anor v. The Board of Trustees Of The Sabah Foundation & Ors [1999] 1 CLJ 325 and Joceline Tan Poh Choo & Ors v. V Muthusamy [2009] 1 CLJ 650. The fivemember Federal Court in the Terengganu Forest case refused to follow the judgment of the three-member Federal Court (Nik Hashim, Augustine Paul and Zulkefli FCJJ) in Joceline Tans case and rejected the additional conditions imposed therein. (See paras [26] and [33] of the Terengganu Forest judgment cited later in this article.)

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It may be noted that earlier in 2007 the five-member Federal Court (Richard Malanjum CJ (Sabah & Sarawak), Alauddin, Abdul Aziz Mohamad, Hashim Yusoff and Azmel FCJJ) in Joceline Tans case [2007] 6 CLJ 1 reviewed decision made in 2005 which allowed the appeal of the appellant. The Federal Court set its own decision upon review under r. 137 and ordered the appeal be reheard by another panel of the Federal Court. See the Federal Courts decision in Joceline Tan Poh Choo & Ors v. V Muthusamy [2007] 6 CLJ 1, which opened the door for disputes or inconsistencies when the Federal Court reheard the same appeal in [2009] 1 CLJ 650, and dismissed the appeal of Joceline Tan which she had won in 2005 based on its interpretation of s. 96(a) of the CJA. The background facts are stated by Augustine Paul JCA in Joceline Tans case in [2009] 1 CLJ 650:
[1] This appeal raises for consideration the nature and manner in which questions ought to be framed for the purpose of an appeal to this court pursuant to s. 96(a) of the Courts of Judicature Act 1964 (s. 96(a)). [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 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.

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In 2010, the 2008 decision of the three-member Federal Court in Joceline Tans case [2009] 1 CLJ 650 was in a way overruled by the five-member Federal Court in the Terengganu Forest case, which refused to follow it but instead followed the principles laid down in Datuk Syed Kechik s case. In his well considered and researched judgment, Zaki Azmi CJ (since retired) referred to similar comparable provisions in several foreign jurisdictions and stated the law and principles involved at pp. 73-76 as follows:
[22] To obtain leave it must be shown that it falls under either of the two limbs of s. 96(a) but they can also fall under both limbs. The argument out that leave should be more liberally allowed to enable the law to be developed would defeat the limitation set by the two limbs of s. 96(a). The purpose of s. 96

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is not to allow for correction of ordinary errors committed by the lower courts as would in an appeal as of right, particularly where the relevant laws are well settled. When a case comes to the Federal Court the case would already have been reviewed on the merits by three experienced judges at the Court of Appeal. So once an issue has been decided by the trial judge, and the appeal decided by a panel of three at the Court of Appeal, that is final unless it can be shown that the case falls within the scope of s. 96(a). [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 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.

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[24] If leave is required in the second limb of s. 96(a) the novelty of the issue need not be shown because the limb requires further argument on the issue. So if further argument is required it cannot be a novelty issue. The applicant has to show that it is for public advantage. [25] Of course the fact that a High Court decision in exercising its original jurisdiction has been reversed by the Court of Appeal or that decision of the Court of Appeal is by majority with a dissenting judgment are matters to be taken into consideration but they do not bind this court to grant leave. There have been

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instances where leave were granted even though there was a concurrent finding by the High Court and Court of Appeal. But those are rather exceptional. [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. [29] Interpretations of statutory provisions are important but again in such a case leave is not to be given as a matter of course. When a statutory interpretation is in issue, it raises questions such as how important those provisions are to the public, or whether the interpretations are so obviously right that the Federal Court can only uphold the Court of Appeals decision. These are pertinent questions to be asked when considering leave. Also, are questions as to whether the interpretation of such statutory provisions are likely to be relevant to only the particular set of facts and to the particular parties, described as a particular fact situation in Syed Kechik (see Beverley Rawleigh). If they are only 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.

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Rule 137 Application Further reference should also be made to applications under r. 137 of the Rules of the Federal Court 1995 with a view to set aside or vary the order made by the Federal Court in the appeal proper. Rule 137 reads:
137. For the removal of doubts it is hereby declared that nothing in these Rules shall be deemed to limit or affect the inherent powers of the Court to hear any application or to make any order as may be necessary to prevent injustice or to prevent an abuse of the process of the Court.

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The Federal Court dealt briefly in passing on the power of the Court under r. 137 in an application made by the respondent Anvest Corporation Sdn Bhd for settlement of the terms of the order of the Federal Court in Wong Siew Choong Sdn Bhd v. Anvest Corporation Sdn Bhd [2004] 4 CLJ 89 at 102. The judgment of the Federal Court on r. 137 was delivered by P.S. Gill FCJ at [2004] 6 AMR 185 at p. 188 as follows:
Finally, in passing, learned counsel for the respondent alluded to r. 137 of the Federal Court Rules 1995 to convince us that this court has inherent powers to redress a wrong as justice of the case requires. In the first place we do not see any wrong to redress in the present case. Secondly, r. 137 does not empower the court to review, vary or alter the judgment of the court.

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 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.

His Lordship continued at p. 45:

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On the other hand, no leave to review should be given where the previous order is challenged on its merits, whether on facts or in law. Merely because the panel hearing the application is of the view that an important piece evidence had not been given sufficient weight or that the current panel disagrees with the interpretation or application of a certain provision of the law is not a sufficient reason for the court to set aside its previous order. The reasons have been amply stated by this court in Adorna Properties Sdn Bhd, supra, with which we fully agree. The only other reason we would like to add is that to freely allow previous orders to be reviewed would lead to panel shopping. An unsuccessful party in an appeal my try its luck before another panel that may disagree with the view of the earlier panel. If he

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is successful in having the order reversed, the other party will do the same thing again. Certainly, we would not like to see this apex court becoming a circus that repeats the same show again and again.

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 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:

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(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). (c) Where the decision had been obtained by fraud or suppression of material evidence (MGG Pillai v. Tan Sri Dato Vincent Tan Chee Yioun [2002] 3 CLJ 577).

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(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). (e) Clear infringement of the law (Adorna Properties Sdn Bhd v. Kobchai Sosothikul [2005] 1 CLJ 565). (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). (g) Where an application under r. 137 has not been heard by this court and yet through no fault of his, an order was inadvertently made as if he had been heard (Raja Prithwi Chand v. Sukhraj Rai AIR 1941 FC 1). (h) Where bias had been established (Taylor & Anor v. & Anor [2002] 2 All ER 353). (i) Where it is demonstrated that the integrity of its earlier decision had been critically undermined eg, where the process had been corrupted and a wrong result might have been arrived at. (Re Uddin [2005] 3 All ER 550). (j) Where the Federal Court allows an appeal which should have been consequentially dismissed because it accepted the concurrent findings of the High Court and Court of Appeal (Joceline Tan Poh Choo & Ors. v. V. Muthusamy [2007] 6 MLJ 485; [2007] 5 AMR 725). (Writers note: In this 2007 Joceline Tans case, the Federal Court set aside its decision made earlier in 2005 and ordered the appeal be reheard by another panel of the Federal Court. In 2008 the new panel of the Federal Court (Augustine Paul FCJ delivered the judgment of the Court, the other two judges being Nik Hashim FCJ and Zulkefli FCJ) reheard this appeal and dismissed the appeal with costs (see Joceline Tan Poh Choo v. Muthusamy [2008] 6 MLJ 621, FC). In 2010, the Federal Court in the Trengganu Forest case [2011] 1 MLJ 25 refused to follow its judgment in the 2008 Joceline Tan s case and instead followed the earlier Federal Court judgment in the Datuk Syed Kechik case [1999] 1 MLJ 257.)

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[15] Similar view was expressed by Heliliah Mohd Yusof FCJ in Dato Seri Anwar Ibrahim v. PP [2010] 7 CLJ 397 at p. 488: The rule itself is been framed as deeming provision. The words nothing shall be deemed to limit or affect means also nothing in the rules shall be regarded as limiting or affecting the inherent powers of the court. The court of course is a reference to the Federal Court. The SG seems troubled by the source of the power. Is the deeming provision a legal fiction or statutory hypothesis? The term inherent power refers to the judicial powers of the Federal Court itself. Inherent means it is intrinsic or organic to the judicial powers of the Federal Court and hence being so the Federal Court draws upon it in the limited circumstances prescribed in r. 137 namely to address injustice or abuse of processes. A certain reserve of powers intrinsically remains with the court for the simple reason that the Federal Court is created by the constitution as a judicial organ at the apex of the judiciary. Hence by virtue of being at the apex it is only the Federal Court (and no other non judicial branch) that has to be the organ to deal with injustice or abuse of processes. It is in that limited sense that the jurisdiction itself stems from the inherent powers, for the powers being intrinsic and organic to the judicial power of the Federal Court, those powers may therefore be drawn upon as and 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.

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In Harcharan Singh Piara Singh v. PP [2011] 6 CLJ 625, Richard Malanjum CJ (Sabah and Sarawak), in a r. 137 application heard by a 5-member panel of the Federal Court, said at p. 152:
[16] Simply put, the rule is nothing more than to declare the obvious that is the inherent power of this court being the apex court of this country to prevent injustice or to prevent an abuse of the process of the court. A court of final instance must be equipped with residual jurisdiction to rehear and reopen its own earlier decision in a fit and proper case (See Taylor v. Lawrence [2002] 2 All ER 353, and Re Uddin [2005] 3 All ER 550). But the rule does not create or provide additional power or new jurisdiction to this court

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(see Asean Security Paper Mills v. Mitsui Sumitomo Insurance (Malaysia) Bhd [2008] 6 CLJ 1). Such must be the legal position as there should be finality in any decision of this court (see Allied Capital Sdn Bhd v. Mohd Latiff Shah Mohd & Another Application [2004] 4 CLJ 350, Adorna Properties Sdn Bhd v. Kobchai Sosothikul [2005] 1 CLJ 565; PP v. Denish Madhavan [2010] 5 CLJ 635). [17] Accordingly, where the Court of Appeal is the apex court of any particular case in view of s. 87 of the Courts of Judicature Act 1964 (CJA) then it is also clothed with such inherent power (see Ramanathan Chelliah v. PP [2009] 6 CLJ 55). And if the High Court is similarly positioned it too has the inherent power (see PP v. Abdullah Idris [2009] 5 CLJ 445). [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. [19] Having said the above we hasten to add that in exercising such power this court must be extremely cautious and to do so only in rare and exceptional cases. (See: Raja Petra Raja Kamarudin v. Menteri Dalam Negeri [2010] 4 CLJ 25; Lim 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).

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