Caveat

Macon Engineers: Caveat is a creature of statute in the nature of a statutory injunction which
has the effect of prohibiting the registration of any instrument of dealing.
Private caveat (Sec. 322 – 329)
A private caveat is a statutory injunction entered by the Registrar upon application by a
person seeking to protect a claim to an existing unregistered interest in the land.
Functions of a private caveat:
- To restrain the registered proprietor from dealing with the land or any interest in the
land (Sec. 322).
- To protect the interests of the caveator by providing interim protection pending the
resolution of the dispute, or the registration of his title or interest in the land (Chin
Cheng Hong).
- To preserve the status quo of both parties until the conflict is resolved by the court
(Jivanjit Kaur v Amar Singh).
- To give notice to the world that the caveator has a claim to an interest in the land
(Butler v Fairclough).
- To determine the priority of competing equities when there is more than one interest
in the land.
- Rice v Rice: He who deals with the land first will get priority.
Creation of a private caveat: Sec. 323(2) – Form 19B with prescribed fee and grounds of claim
Persons who can apply for a private caveat (has a caveatable interest):
Sec. 323(1)(a):
- A person or body claiming title to any alienated land
- Must have an existing title to the land before he can claim it
- Kumpulan Sua Bentong: A prior registered proprietor challenging the title of a
new registered proprietor is a body claiming title to land within Sec. 323(1)(a)
and thus, has a caveatable interest.

- A person or body claiming registrable interest in any alienated land

- The interest in land is registrable, but has yet to be registered.
- Yap Sing Yoke: A chargee could lodge a private caveat where the charge
document had been signed, but had yet to be registered.

- A person or body claiming any right to title or registrable interest in any alienated land
- Includes those who have signed contracts relating to land and have an
equitable right or right in personam to have the contract enforced.
- Macon Engineers: A purchaser of land who has paid the deposit under an
agreement has a right or interest in the land and can thus, lodge a private
caveat even though he has yet to become the registered proprietor.
 - Goh Hee Sing v Will Raja: Where there is a restriction in interest on the title which
requires the consent of the State Authority in order to transfer the land, the purchaser
will not be deemed to have a caveatable interest until such consent is obtained.

- Muruggappa Chettiar v Lee Teck Moon: In the absence of a concluded contract, it

cannot be said that the caveator has a caveatable interest.
- Million Group Credit: An intended purchaser at a negotiation stage who has yet to
conclude the contract does not have a caveatable interest.
Caveating one’s own land:
- General rule in EU Finance v Siland: A registered proprietor does not fall within the
ambit of Sec. 323(1)(a) as he already has title to the land, thus he cannot caveat his
own land.

- Sharifah Mastura v Wan Aziz Ibrahim: A registered proprietor of land is not entitled to
enter a private caveat in respect of his own land unless he could show some
circumstances which affirmatively gives rise to a distinct interest in the land other
than the fact that he is the registered proprietor of the property.
- The onus is on the registered proprietor to satisfy the court that he has a
caveatable interest within the exception.

- Thus, a registered proprietor cannot base a caveat against dealings solely on his status
as the registered proprietor of the land.
- Affin Bank v Dato Mohamed: He must be able to establish special circumstances over
and above his status as a registered proprietor which affirmatively gives rise to a
distinct interest in the land.
- Only upon establishing such circumstances would he not be prevented from
caveating his own land.

- Asia Commercial Finance v Development & Realtor: A caveat may be lodged by a

registered proprietor where his indefeasibility of title is threatened by the possibility
of registration of some unauthorized dealing.
- Circumstances such as suspected theft of a certificate of title, which makes it
expedient for the registered proprietor, by lodging a caveat, to prevent
registration of any forged dealing which could deprive him of his land.

- Barry v Heider: The plaintiff claimed that he had been induced by fraud to sign a
transfer and lodged a caveat to forbid registration of that transfer.
Effects of private caveat:

- Sec. 322(2): Prohibits the registration, endorsement or entry on the RDT of

- Any dealings or certificate of sale by the court
- Any tenancy exempt from registration granted
- Any lien-holder’s caveat
Duration of a private caveat:
- Sec. 328(1): A private caveat will lapse after 6 years.
- Azlan Maidin: Once a caveat lapses, the caveator can no longer rely on any claim of
caveatable interest in the land.
Termination of a private caveat:
- Sec. 325: Withdrawal by caveator
- By a notice in Form 19G along with a prescribed fee which must be presented
to the Registrar by the caveator

- Sec. 326: Removal by Registrar

- (1): A caveatee (person whose land has been caveated; must be a registered
proprietor of title or interest in the land) can apply to the Registrar for removal
of the caveat in Form 19H along with a prescribed fee.
- (1A): The Registrar will then serve the caveator with a notice of intended
removal in Form 19C
- (1B): The caveat will lapse (be removed) two months after the notice is served
unless the caveator obtains a court order to extend the caveat

- Sec. 329(2): After the removal, the caveator cannot then lodge another private
caveat on the land on the same grounds.

- Sec. 327: Removal by court

- Any aggrieved party may apply to the court for the removal of the private
caveat.
- Rap Nathan: Whether a person is aggrieved by the existence of the caveat
depends on whether he will suffer loss is the caveat is not removed.
Registrar’s caveat (Sec. 319 – 321)
A registrar’s caveat can be lodged by the Registrar under his own discretion or upon
application by a registered proprietor to protect and prevent dealings with the land.
- Palaniappa Chettiar v Letchumanan Chettiar: It is clear under the Code that the
Registrar may act on his own motion or upon request made to him.

- EU Finance v Siland: A registered proprietor who has had his IDT stolen and fears that
it will be misused may apply under Sec. 320(1)(a) for the entry of a registrar’s caveat.
- Adorna Properties: The appellant sought entry of a registrar’s caveat after complaining
that her title had been used towards a forged transfer of title to the respondent.
Functions of a Registrar’s caveat:
- Sec. 320(1)(a): To prevent fraud or improper dealing
- A Registrar may lodge a registrar’s caveat upon application if he is satisfied that
there has been fraudulent conduct in any land dealing that has caused the
applicant to suffer loss.
- The fraud alleged must be that of actual fraud which has been committed or is
about to be committed.

- Seet Soh Ngoh: Where the defendant had wrongly terminated the Sale &
Purchase Agreement, the court ordered the Registrar to lodge a registrar’s
caveat to prevent fraud or improper dealing on the land.
- Lim Ah Hun: Where there was evidence of a police report alleging fraudulent
transfer of the land, the Registrar was satisfied that there was sufficient and
valid ground to exercise his power to prevent fraud or improper dealing.

- Sec. 320(1)(b): To protect the interest of the government (Federation or State

Authority) or any person who is suffering from any disability, or any person absent
from the Federation.
- The interest must be one related to land.
- Pow Hing: Where there was failure to pay quit rent, the State Authority had a
registrar’s caveat lodged on the land.

- Sec. 320(1)(ba): To secure that the land will be available to satisfy the whole or part of
any debt due to the government, whether it is secured or unsecured.
- Relates to protecting the interests of the government
- The registrar’s caveat can be used by the Inland Revenue Dept. to prevent any
dealings on the land belonging to a person who owes tax to the government.
- MUI Finance: Although a registrar’s caveat has been entered, the court has no
power to order the land to be sold to satisfy the debt to the government, nor
can the court order the land to be charged to another party until the debt is
settled.
 - Sec. 320(1)(c): To correct errors made on the RDT or IDT to the land or any related
instrument
- The registrar’s caveat can be entered to protect the register pending the
correction of an administrative error made by the Registrar’s office.
- The correction is made pursuant to Sec. 380
Creation of a registrar’s caveat: Sec. 321(1) & (2) – Form 19F and shall be effected by the
endorsement of “Registrar’s Caveat Entered”, after which the registered proprietor will be
notified in Form 19A.
Sec. 319(1)(a): The Registrar, in exercising his power, must be satisfied that the information
supplied to him in support of the request is credible, to which he must act reasonably
according to the circumstances of the case.
- Seet Soh Ngoh: The court may order the Registrar to enter a registrar’s caveat to
prevent fraud or improper dealing.
- Palaniappa Chettiar: The court can order the Registrar to enter a registrar’s caveat
even where he is not a party to the suit.

- Tan Soo Bing: Any refusal of a registered proprietor’s application for a registrar’s
caveat by the Registrar allows for an appeal to be made to the court against such
refusal under Sec. 418.
Effects of a registrar’s caveat: Sec. 319(1)(b) – Similar to effects of a private caveat
Duration of a registrar’s caveat: Sec. 321(3) – It will continue in force until it is cancelled
Removal of a registrar’s caveat:
- Sec. 321(3): A registrar’s caveat can be removed by 3 ways
- By the Registrar’s own motion
- On an application by the registered proprietor of the caveated land
- By an order of court granted to the registered proprietor against the refusal of
the Registrar to remove the registrar’s caveat under Sec. 418

- MUI Finance: A chargee does not have the right to apply for the removal of a registrar’s
caveat as this can only be done by a registered proprietor.
Prohibitory Order
Sec. 334: An order made pursuant to rules of court by a court of competent jurisdiction
(High Court) prohibiting the judgment debtor from effecting any dealing in respect of his land.
Operation of a prohibitory order:
- Where a borrower defaults in the repayment of an unsecured loan (land is not used
as security), the creditor may take legal action to recover the outstanding amount,
and will receive a judgment debt confirming the existence of the debt and its amount.
- Where the court orders the judgment debtor (borrower) to pay the judgment
creditor, failure to pay will cause the judgment debt (Order 42, ROC) to be enforced.
- If the judgment creditor succeeds in identifying land which belongs to the judgment
debtor and is free from encumbrances, the judgment creditor may attach the debt to
the land and obtain a writ of seizure and sale (Order 47) to subject the land to a sale
by way of public auction.
- The court will then issue a prohibitory order preventing any further dealings of the
land by the judgment debtor to protect the interest of the judgment creditor pending
the sale of land.
- The sale by way of public auction will be confirmed by the court before the order is
cancelled. The proceeds of the sale will then be used to satisfy the debt.
Validity of a prohibitory order:
- Sec. 335(1): The prohibitory order takes effect from the date of its entry on the RDT
and not upon its pronouncement by the court.
Effects of a prohibitory order:
- Sec. 336: Prohibits the registration, endorsement or entry on the RDT of
- Any dealings, except a certificate of sale by the court
- Any tenancy exempt from registration granted
- Any lien-holder’s caveat

- Karuppiah Chettiar v Subramaniam: A purchaser who has lodged a caveat to protect

his interest in the land has priority over the claim of a judgment creditor who then
entered a prohibitory order against the land, thus the purchaser’s application to set
aside the prohibitory order is allowed.
Duration of a prohibitory order: Sec. 338 – For 6 months from the pronouncement of the
order by the High Court and not on the date it is entered on the RDT
Termination of a prohibitory order:
- Sec. 338(1): At the expiry of 6 months, unless extended by an order of the court
- Sec. 339(1): Withdrawn by an order of the court
- Sec. 339(2)(a): Upon registration of transfer executed – successful bidder or judgment
creditor is now the registered proprietor of the land
- Sec. 339(2)(b): Upon registration of a certificate of sale under Sec. 259(3) & 265(4)