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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 It is interesting to note that under s. 2 of the repealed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

L A W

* 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.

L A W

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).

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

L A W

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

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.

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In this connection, it is relevant to refer to art. 152 of the Federal

Constitution which reads:
152 National language

(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:

L A W

[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.

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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

Bankruptcy Act 1967

2. Proceedings relating to
the winding up of
companies and capital
reduction

Companies Act 1965

3. Criminal proceedings

Criminal Procedure Code

[Act 593]

4. Proceedings under the

Elections Offences Act
1954

Elections Offences Act

1954 [Act 5]

5. Matrimonial proceedings

Law Reform (Marriage and

Divorce) Act 1976 [Act 164]

6. Land reference

Land Acquisition Act 1960

[Act 486]

7. Admission to the Bar

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:

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[Form 19F]

(Section 320)

ENTRY OF REGISTRARS CAVEAT

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
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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.

L A W

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:

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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).

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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.

L A W

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.

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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.

L A W

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:

L A W

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:

L A W

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.

L A W

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

L A W

(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 -

(i) any claim to the benefit of any tenancy exempt from

registration granted directly thereout, and
(ii) any lien-holders caveat in respect thereof.
(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:

L A W

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

L A W

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:

L A W

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

L A W

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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:

L A W

(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.)

L A W

(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:

L A W

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.

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.

L A W

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.

L A W

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.

L A W

Removal Of Private Caveats

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.

L A W

Removal Under s. 327

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.

L A W

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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.

L A W

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.

L A W

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:

L A W

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.

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:

L A W

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

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:

L A W

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:

L A W

In the proceedings before us, what interest does the respondent

possess? It is not in the land. That has already been validly sold.
Her interest really lies in the profits that her company hopes to
gain from the joint venture agreement with the appellant, which is
being challenged by the appellant. The civil suit testifies to this.
As her interest is only monetary in nature, she has therefore no
caveatable interest over the land. She cannot continue to have the
private caveat lodged by her extended until after the disposal of
the civil suit.

The above Trans-Summit case, Hew Sook Ying v. Hiw Tin Hee
[1992] 3 CLJ 1352; [1992] 1 CLJ (Rep) 120, and Perbadanan
Setiausaha Kerajaan Selangor & Ors. v. Metroway Sdn Bhd & Anor
& Another Appeal [2003] 3 CLJ 339 were referred to and followed
by the Court of Appeal (Mokhtar Sidin JCA, Mohd Ghazali
Yusoff JCA (as he then was), and Zulkefli Makinudin JCA (as he
then was)) in Tan Geok Teck & Yang Lain lwn. Upaya Kelana (M)
Sdn Bhd [2007] 3 CLJ 312, a case on joint-venture to develop a

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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:

L A W

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

L A W

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

L A W

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

L A W

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.

L A W

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.

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:

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Therefore, prima facie the applicants who are prior in time must
succeed unless it can be shown that he had relied on something
tangible and distinct having grave and strong effect to accomplish
the purpose: see Shropshire Union Railway and Canal Co. v. The
Queen. In the present case the substantial complaint against the
applicants is that they had failed to register the caveat before the
act of bankruptcy was committed. That, as had been perceptively
said in Shropshire Union case is not conduct of a character which
would operate and enure to forfeit and take away the pre-existing
equitable title. The applicants had not parted with the documents
of title. They retained possession of them all the time and it is
open to them to register the caveat at any time. In my judgment,
they had done nothing to forfeit their priority.

In Standard Chartered Bank v. Yap Sing Yoke & Ors [1989] 1 CLJ
530; [1989] 2 CLJ (Rep) 500, where the parties thought to effect
a registered charge, but due to the absence of a quit rent receipt
the charge could not be registered. The documents were returned
to the 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.

L A W

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
Banks 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

L A W

(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.

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:

L A W

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
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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.

L A W

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:

L A W

(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.

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.

L A W

(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.

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:

L A W

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.

L A W

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:

L A W

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.

L A W

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.

L A W

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.

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).

L A W

In the case of a refusal by the vendor to complete a contract for

the sale of land the normal remedy of the purchaser as plaintiff in
an action is an order for specific performance of the contract; and
in the absence of special circumstances, if it were shown that the
vendor threatened to dispose of the land while the action was still
pending, the balance of convenience would be in favour of granting
an interlocutory injunction to prevent his doing so, provided that
the plaintiff would be in a position to satisfy his undertaking as
to damages if the action should fail at trial.

Likewise, Peh Swee Chin J (as he then was) in Foo Poh Sang &
Ors v. Yuen Lum Sdn Bhd & Intervener [1989] 1 CLJ 440 at
pp. 444-445 said:
Finally, I will deal now with the major submission of intervener
that that the injunctive order in question was a caveat in the guise
of an injunction and once the caveat was removed, the injunctive
order could not remain.

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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.

L A W

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.

L A W

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

L A W

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).

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:

L A W

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:

L A W

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.

L A W

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.

L A W

[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.

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(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.

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Court Of Appeal Practice Direction No. 2 Of 2012

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.

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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.

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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 Kechiks 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.
...

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[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.

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.

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His Lordship continued at p. 45:

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:

L A W

(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).

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(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 Tans 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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