1. ) Nor Azizan Binti Ibrahim v Abadan Bin Jasmon (JA-24NCvC-1335-10/2024)

NOR AZIZAN BINTI IBRAHIM …PLAINTIF - (No. K/P : 630525-10-7246)

NOR AIDA BINTI IBRAHIM (No. K/P : 660307-10-6218) DAN ABADAN BIN JASMON …DEFENDAN (No. K/P : 600821-01-5111) S/N lzeazadtHUa0aahy4ctsug

This is an application in enclosure 1 by the Plaintiffs applicant to remove the caveat entered into by the Defendant on 19.6.2024. The Defendant was the husband to the 1st Plaintiff who had entered the caveat on the land known as Geran 521319 Lot 92758 Mukim Kulai, Johor. The 1st Plaintiff and the Defendant was divorced subsequently on 4.7.2024.

The land is registered under both the Plaintiff’s names on 2.1.2016 with each registered as proprietor of ½ share. Via a Sale and Purchase agreement dated 4.7.2024, both the Plaintiff had agreed to sell the property to 2 purchasers at the price of RM555,000.00. Both the purchasers had paid a 10% of the purchase price as deposit to the Plaintiffs’ lawyer. The sale, however could not proceed as a land search done revealed a caveat entered by the Defendant on 19.6.2024 registered as “No. Perserahan 27025/2024”.

The Statutory Declaration filed by the Defendant in seeking for the entry of the private caveat coupled with the affidavit-in-reply enclosure 7, contain the following:

sum of RM86,133.00 paid by the Defendant as deposit and legal cost in purchasing the said land;

the said land is a property obtained during marriage, (translated via the Defendant’s affidavit-in-reply as “harta sepencarian)”; S/N lzeazadtHUa0aahy4ctsug

the Defendant and the 1st Plaintiff are in the process of seeking for divorce;

the entry of the private caveat is to protect the Defendant’s interest as the Defendant believes the 1st Plaintiff intends to sell the said property.

The 1st Plaintiff in her final affidavit-in-response (“AIR”) enclosure 9 out of her 3 affidavits, contended that the Defendant’s stand that the said land is a property obtained in marriage, however was not supported by any evidence. However, the 1st Plaintiff did not oppose in entirety the Defendant’s deposition that the land is a subject of a ‘harta sepencarian’ but took the view that the claim on the property as ‘harta sepencarian’ can be dealt with by converting the value of the land into monetary form to be divided between the 1st Plaintiff and Defendant.

To achieve this, the 1st Plaintiff instead took the stand that it is not a claim that is captured and protected under section 323(1) of the National Land Code that carries a caveatable interest of the Defendant on the said land. Rather, the 1st Plaintiff took the stand that the said deposit payment by the Defendant carry no value recognized by law as the Defendant’s name was not registered as owner hence no indefeasibility of title under section 340 of the National Land Code.

The 1st Plaintiff’s deposition that the Defendant was the one who had proposed for the property to be sold and had in fact looked for an agent to scout for potential purchasers is consistent with the 1st S/N lzeazadtHUa0aahy4ctsug Plaintiff’s proposal to address the Defendant’s claim of the said land as marriage property “harta sepencarian”.

A letter dated 27.5.2024, alleged by the 1st Plaintiff drafted by the Defendant for the 1st Plaintiff’s signature to mark an indication of consent for the proceeds of the sale of the said land be distributed equally between the 1st Plaintiff and the Defendant, was annexed to the 1st Plaintiff’s AIR enclosure 9. The 1st Plaintiff deposed that she opted not to sign the said letter. These facts go to how that the Defendant was consistent in his version of what transpired in relation to the said land and the interest he has on the land.

This letter said was prepared by the Defendant, in fact resembles the alternative proposal of the 1st Plaintiff in her affidavit enclosure 9 that even if the property is ‘harta sepencarian’, the Syariah Court will need to determine on the rightful portion of the Defendant before a monetary payment can be made. To the contrary, the submission by the 1st Plaintiff in short is that the Defendant has no caveatable interest as ‘harta sepencarian’ is not a claim that falls within the scope of section 323(1). The Issues, The Law And Findings By This Court

Firstly, this Court finds there is only one crucial issue arising in this suit that is if claim for ‘harta sepencarian’ of the said land by the Defendant amounts to the Defendant having a caveatable interest on the said land. One would be aware that although a divorce was pronounced by the Syariah Court, the jurisdiction to do so is before S/N lzeazadtHUa0aahy4ctsug the Syariah lower court. Claim for matrimonial property ‘harta sepencarian’ needs to be filed before the Syariah High Court.

The 1st Plaintiff did not deny the Defendant has such right but refute the claim by taking the position that at the time of filing of this Originating Summon by the Plaintiff, the Defendant had not filed any action for such claim at the Syariah Court. In addition, this claim does not give rise to a ‘caveatable interest’ on the said land. The caveat therefore was wrongly entered.

The relevant provisions in the National Land Code (NLC) are sections 323 and section 327. As to the caveatable interest, section 323 of the NLC 2020 provides as follows:

The persons and bodies at whose instance a private caveat may be entered are:

any person or body claiming title to, or any registrable interest in, any alienated land or undivided share in any alienated land or any right to such title or interest;

any person or body claiming to be beneficially entitled under any trust affecting any such land or interest; and

the guardian or next friend of any minor claiming to be entitled as mentioned in paragraph (b). S/N lzeazadtHUa0aahy4ctsug

…

…

On the removal of the caveat, section 327 states the following: Section 327. Removal of private caveats by the Court

Any person or body aggrieved by the existence of a private caveat may at any time apply to the Court for an order for its removal, and the Court (acting, if the circumstances so require, ex-parte) may make such order on the application as it may think just.

The Registrar shall, on being duly served with any order under this section for the removal of a caveat, cancel the entry thereof on the register document of title, and note thereon the reason for the cancellation and the date thereof.

Every cancellation under subsection (2) shall be signed and sealed.

In Sing Lian Express Sdn. Bhd v Soh Kim Tee (1974) 2MLJ 24 the judgment of Syed Othman J is relevant, which had the opportunity to deal on the issue of whether the option available before the parties (which is akin to this present case on recommendations made towards claim on “harta sepencarian”) is merely an inchoate agreement found as follows: S/N lzeazadtHUa0aahy4ctsug “…In the present case there is no mention in the option that its exercise would be subject to a formal contract. The respondent by an affidavit shows conclusively that he was willing to purchase the land at the stated price. It also shows that an offer was made to pay 10% deposit… that a draft agreement had been prepared inviting the company to state the date when the balance...was to be paid and stipulating that the respondent was to forfeit the deposit if the balance was not paid within the time to be prescribed in the agreement; and that the managing director (seller) refused to accept the deposit and to sign the draft agreement. In other words, the respondent gave an irrevocable proof of his willingness to purchase the land … In the circumstances shown… I hold that the respondent has a caveatable interest.”

Although it was argued in that case that the appointment of the respondent was merely as an agent and nothing more and not intended that he should exercise the option himself, Syed Othman J was of the view this is to be proven by evidence in the trial. This did not interfere with the question before the court then on the issue of caveatable interest which the Court held the Respondent did possess that right, even prior to the commencement of the trial.

The finding by the Court above was by virtue of section 323(1)(a) and

(b). To the contrary, the attention of this Court must also be directed S/N lzeazadtHUa0aahy4ctsug to the case of Murugappa Chettiar Lakshamanan (Wasi Tunggal Harta Pesaka M.R.L Murugappa Chettiar, Simati) v Lee Teck Mook [1995]1 MLRA 206 CA as this seems to be in line with the stand taken by the Plaintiffs that since the Defendant’s interest by way of deposit sum paid by the Defendant at the time of the purchase of the property was never registered, Gopal Sri Ram JCA said to this effect, as follows: “Unless and until the 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 entry of a caveat. As we have said, the application for the entry of the caveat in the instant case contains no assertion of a concluded contract”.

Reverting back to this present case, the timeline of the divorce order made on the application before the Syariah Court by the 1st Plaintiff in this case can be seen when the Syariah Court order was pronounced on 4.7.2024. The SPA between the Plaintiffs and the purchasers, dated the same. The caveat by the Defendant was registered about 2 weeks earlier on 19.6.2024 with this OS to set aside the caveat filed by the 1st Plaintiff on October 2024. The Defendant in his affidavit had deposed the claim for matrimonial property would be made at the right time.

This Court is of the view, with the divorce application first filed by the 1st Plaintiff, the option is open to the Defendant to either file for the property claim at the Syariah High Court or having lodged a caveat, S/N lzeazadtHUa0aahy4ctsug the Defendant can wait and respond to the 1st Plaintiff’s matrimonial property claim when the 1st Plaintiff had done so. Hence, to this Court’s view, to penalize the Defendant at this stage for the omission to file for the said claim before the Syariah High Court, is premature.

It is also relevant and necessary to discuss the meaning of ‘caveatable interest’. The Court of Appeal in Luggage Distributors (M) Sdn Bhd v Tan Hor Teng & Anor [1995] 1 MLJ 719, also a judgment by Gopal Sri Ram JCA, on the meaning of caveatable interest said as follows: “CAVEATABLE INTEREST To paraphrase s 323(1)(a) of the Code, a private caveat may be entered at the instance of any person or body who claims either:

the title to land; or

any registrable interest in land. The parameters of caveatability under Section 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. Although the words ‘title’ and ‘registrable interest’ are not defined by the Code, their meaning may be gathered from the scheme of the Code and from the indefeasibility provision, namely, Section 340(1). The latter points to a bifurcation between the title (the equivalent of S/N lzeazadtHUa0aahy4ctsug the English fee simple) and registrable interests, that is, leases, charges and easements. In my judgement, the position that obtains under the Code, so far as is relevant to the present appeal, may be stated in the following way. The Code creates three categories of interests in land. They are as follows: Category 1 : registrable interests in land Only certain interests are capable of registration. Within this are two sub-categories, namely:

Registered title. This may be in perpetuity or for a term of years. It pertains to ownership of land. The ‘owner’ is termed by the Code as a ‘registered proprietor’; and

Registrable interests falling short of ownership. These are leases, charges and easements. Registration carries with it a bundle of rights, which includes, subject to any restriction imposed by the alienating authority, the right to effect a transfer of the particular registered interest. The Code, in Section 340(1), confers indefeasibility upon registered title and interests in land. Section 340(2) creates exceptions which, if established, may operate to defeat such registered title or interest. S/N lzeazadtHUa0aahy4ctsug Category 2 : interests that are incapable of registration These include tenancies exempt from registration, which may be protected by means of an endorsement upon the register document of title. Category 3 : caveatable interests These are unregistered interests which are capable of protection by the entry of a private caveat. In the context of Section 323(1)(a), it is only a claim to the interests falling under category 1(a) and (b) above that may be protected by the entry of a private caveat. Cases falling under category (2) are not caveatable interests. A private caveat cannot, therefore, be entered by one who claims such an interest. Protection for such interests must be secured in the manner prescribed by the Code. I fear that any other construction upon s 323(1)(a), especially one that places a meaning wider than that I subscribe to, may result in judicial disobedience to the will of Parliament and that in my view should be avoided at all cost”.

In Wong Kuan Tan v Gambut Development Sdn Bhd [1984] 2 MLJ 113 Wan Suleiman, Abdul Hamid and Hashim Yeop A Sani FJJ deliberated on this point and came to a determination as follows: “The expression “interest” in the National Land Code was examined by the Privy Council in Registrar of S/N lzeazadtHUa0aahy4ctsug Titles, Johore v Temenggong Securities Ltd [1976] 2 MLJ 44. An unsecured civil debtis a mere personal claim and did not come within the meaning of “interest” in Section 320(1) of the National Land Code. Section 320 deals with circumstances in which the Registrar's caveat may be entered. The interest referred to in Section 323(1) of the Code is interest as envisaged in the Code. Lord Diplock in Temenggong Securities Ltd. said at page 47: “The expression “interest” is used in many sections throughout the Code apart from section 320 and in none of them to which their Lordships' attention has been drawn can it be plausibly suggested that it bears any wider meaning than an interest in land of a kind which is recognised by the Code as being either registrable or otherwise entitled to protection.” Thus it is plain that the appellant claimed to have the right to lodge the caveat but based on Clause 4(a) of the Deed of Assignment. It is also plain that this was a contractual right applicable only when purchase price is not fully paid. But this alone cannot create a caveatable interest in the land. The contractual provision does not create an interest within the meaning of Section 323 of the National Land Code. Interests which are protectable by caveat are only interests recognised by the Code. The contractual provision does not amount to an equitable or other interest sufficient to support a caveat. S/N lzeazadtHUa0aahy4ctsug Section 323(1) of the National Land Code sets out the classes of persons who may lodge private caveat. They are person or body claiming title to any alienated land; or claiming any registrable interest in any alienated land; or claiming any right to such title or interest; and includes person or body claiming to be beneficially entitled under any trust affecting any such land or interest. The words “any right to such title or interest” may be wide enough to allow rights arising under a contract for registrable dealing to be protected by a caveat but they are not wide enough to cover mere personal rights as distinguished from rights relating to land”.

In Wong Kuan, the Court deliberated further as follows: “To put it more simply, the caveator in this case must first satisfy the court that he has a “caveatable interest” in the land. Only if he has such an interest can he qualify to lodge a caveat under Section 323 of the National Land Code. In the application to have the caveat removed the onus is cast upon the caveator to satisfy the court that on the evidence presented his claim to an interest in the land raises a serious question to be tried and after having done so he must go on to show that on the balance of convenience the caveat should be extended until the disposal of the main action”.

To the contrary, this Court has its reservation to apply athe decision in Chen Sook Peng v Wee Phean Yung [2004] 5 MLJ 116 when decision arrived at was on the basis that a small sum paid compared S/N lzeazadtHUa0aahy4ctsug to the final sum in dispute. The Court found in the said case as follows: “[23] Mahkamah ini juga berpendapat bahawa hanya di atas ketiga-tiga pembayaran ansuran berjumlah RM5,821.83 sahaja yang dibuat oleh responden tidak semestinya memberi setengah bahagian kepentingan atau hak di atas harta tersebut kepada responden apabila berbanding dengan harga harta tersebut seperti yang dikatakan oleh responden sendiri bahawa harga harta tersebut adalah dalam lingkungan RM400,000 melainkan mungkin ia akan membawa satu tuntutan untuk mengembalikan wang sebanyak RM5,821.83 tersebut kepada responden oleh pemohon atau sebarang kerugian yang akan ditaksirkan. (Rujuk kes Re Heng Peng Hoo & Anor [1989] 3 MLJ 103)”.

The principal issue for determination in this appeal is the question of whether the defendant has any caveatable interest on the land. The law on this subject is well settled (see Luggage Distributors (supra). Guided by this authority, this Court recognizes the procedure to follow below: “[13] The procedure to be adopted by court on the hearing for removal of a caveat may be distilled into the following three steps:

Conduct an examination of the grounds set out in the application for the caveat: this is a question of mixed S/N lzeazadtHUa0aahy4ctsug fact and law. If the grounds expressed in the application are insufficient in law to support a caveat, then cadit quaestio (the dispute is over), and the caveat must be removed without having to go any further.

(ii) If the claim as set out in the application in Form 19B amounts in law to a caveatable interest, the defendant must also show on the affidavit evidence that his claim discloses a serious question meriting a trial. This is question of fact.

(iii) If the court is satisfied that there is a serious question meriting a trial, the court will go on to consider whether the balance of convenience or balance of justice lies. [14] What amounts in law to a caveatable interest is clearly spelt out under the NLC which provides that a private caveat may be entered in the following instances:

any person claiming title to, or any registrable interest in, any alienated land;

(ii) any person claiming a beneficial interest under any trust affecting such land or interest; and

(iii) a guardian or next friend of any minor claiming to be beneficially entitled under any trust affecting such land or interest (s. 323(1) of the NLC ). S/N lzeazadtHUa0aahy4ctsug [15] The question of what is a caveatable interest was considered by the Federal Court in Score Options (supra). The following principles may be distilled from the judgment of the apex court:

Unlike registrable interests in land (such as ownership of land, leases, charges and easements) or interests that are incapable of registration (such as tenancies exempt from registration), caveatable interests are unregistered interests which are capable of protection by the entry of a private caveat;

The purpose of a caveat is to protect an interest in land, or a right to an interest in that land and to preserve the status quo of the land pending the enforcement of such interest or right;

Only a claimant who has a caveatable interest under the NLC may lodge a caveat;

Only parties who are authorised to lodge a private caveat are those who may effect dealings in the particular interests in the land;

To be caveatable, the interest must be an interest in the land which is capable of registration. In other words, it must represent a transaction that can ultimately lead to its registration on the Register; and S/N lzeazadtHUa0aahy4ctsug

The registrable interest that the caveator is claiming for under s. 323(1)(a) of the NLC must have a present or existing interest as opposed to a potential interest in the land or interest in future. [16] It is also settled law that a claim for a mere debt cannot amount to a caveatable interest (Registrar of Titles Johore v. Temenggong Securities Ltd [1976] CLJU 135; [1976] 1 LNS 135 PC)”.

As an analogy, it would be relevant to also discuss the case of Pasupathi Sithamparan V Adam Abdullah [2018] 10CLJ 306 (COA), where the caveat was set aside by the COA on the facts before them that: [17] We will deal with the first step to be adopted by the court on the hearing for removal of a caveat. The learned JC decided that the defendant has a caveatable interest on the basis that without the option the defendant would not have given the loan to the borrower. In other words, the learned JC founded his decision on the fact that the defendant had an option to purchase the land on the basis of the affidavit evidence filed in the proceedings. [18] As adverted to in paras. [4] and [5] above, the grounds upon which the defendant gave in support of his claim is that pursuant to a friendly loan agreement he gave a loan of RM275,000 to the borrower. There is no mention or reference to an option in the grounds of the application or in S/N lzeazadtHUa0aahy4ctsug the statutory declaration. As such, we are constrained to hold that the learned JC did not confine his examination to the grounds contained in the application for the caveat. [19] It is trite that if the grounds contained in the application are insufficient in law to support a caveat, then the caveat must be removed without having to go any further. Be that as it may, even if the fact that the defendant had been granted an option is taken into account, there is no evidence to indicate that the defendant had exercised the option to purchase the land immediately after the expiry of the due repayment date or within a reasonable time thereafter (Chong Siat Yong & Ors V. Yee Mun Ying & Anor [1986] 1 CLJ 37; [1986] CLJ (Rep) 320). We agree with the submission of learned counsel for the plaintiff that the option had lapsed as the defendant had failed to exercise the option within the one-month period immediately after the borrower failed to repay the loan. In this circumstance, it cannot be said that there was a transaction that can ultimately lead to its registration on the register. As such, on the particular facts of this case, the mere existence an option is of itself clearly insufficient in law to support a caveat”.

This Court is of the view the facts presented in this present case is distinguishable. This, as extracted and discussed in the earlier paragraphs of this GOJ would reveal the 1st Plaintiff was notified of the Defendant’s claim on the said land from the draft letter prepared by the Defendant, in the 1st Plaintiff’s possession, dated 27.5.2024. S/N lzeazadtHUa0aahy4ctsug

The supporting facts of divorce and the sale taking place on the same date raises an eyebrow. For these reasons and having directed its mind to the principles in the higher Courts decisions, in addition to distinguishing the facts in some of the authorities cited, this Court is of the view the 1st Plaintiff’s application in enclosure1 must be dismissed.

The Defendant has a caveatable interest to have the caveat retained pending disposal of the matrimonial asset claim before the Syariah High Court, and this can be initiated by either and not necessarily be moved by the Defendant himself. The absence of proof in the form of bank slips of the deposit payment by the Defendant is akin to the 1st Plaintiff tendering bank slips in parts and pieces but for current dates (see: exhibit “NAI-10” enclosure 2), contrary to the fact that the land was registered in 2016 and charged to Maybank Islamic on 3.7.2014.

The purpose of a caveat is to protect an interest in land, or a right to an interest in that land and to preserve the status quo of the land pending the enforcement of such interest or right (see: Luggage Distributors (supra). For these reasons, enclosure 1 is dismissed. S/N lzeazadtHUa0aahy4ctsug Bertarikh : 29 Ogos 2025 (Nurulhuda Nur’Aini Binti Mohamad Nor) Hakim Mahkamah Tinggi Malaya Johor Bahru Johor Darul Ta’zim Peguamcara Plaintif-Plantif : Hariz Yusoff Bersama Muhammad Qayyim Bin Saiful Bahari Tetuan Hariz Syakinah & Co. No. L-07-01 Level 7 Blok L Solaris Mont Kiara No. 2 Jalan Solaris Mont Kiara 50480 Kuala Lumpur Peguamcara Defendan : Nur Asnani Binti Mohd Basharuddin Tetuan Deidra Sharina & Co. No. 3-1 Jalan PP Ixora 1 Pusat Perniagaan Ixora Senawang 70450 Seremban Negeri Sembilan S/N lzeazadtHUa0aahy4ctsug