2.048 2,593,499.40 TOTAL 16,165,681.80 [43] As such, it is to be noted that the computation of the Appellant's 10 loss by SP1 and SP3 was not challenged by the Respondent during the trial. Therefore, it is deemed to be admitted. See: Sarkar on Evidence Vol 2, (14th Ed) at page 2006 [Tab 6 of IA/P] 15 Aik Ming (M) Sdn. Bhd. & Ors v Chang Ching Chuen & Ors and another appeal [1995] 2 MLJ 770 at page 71 Ng Hee Thoong & Anor v Public Bank Bhd [1995] 1 MLJ 20 281 [Tab 8 of IA/P at pages 110 and 115] 43 [44] Premise on the foregoing submissions, the Appellant submitted 5 that the learned judge had erred in law and in fact when he dismissed the Appellant's claim with costs of RM100,000.00. Thus, the Appellant prays that the appeal herein would be allowed with costs. 10 THE RESPONDENT’ SUBMISSION [45] On the issue whether there is a contract, the Respondent submitted that the law is clear that the action founded on contract could not be sustained. This is because the learned Judge in the 15 grounds of judgment at paragraph 16 (Page 23 Rekod Rayuan Tambahan) stated the documents relied upon by the Appellant clearly showed that the property was sold by the Registrar and not the Respondent. 20 [46] Furthermore, pursuant to cross-examination, the Appellant conceded the Respondent was not the Vendor of the property (Paragraph 17 Grounds of Judgement, Rekod Rayuan Tambahan Page 24). Thus, based on the pleading i.e. paragraph 13 of the Statement of Claim, there was no contractual nexus between the 25 Appellant and the Respondent. [47] The string of cases dealing with the issue of whether there is a contract between the Chargor and the successful bidder at an auction were fully ventilated before the learned judge in the 30 44 submissions. The conclusion to be drawn was that the Chargor 5 could not be considered to be the Vendor as stated in the earlier decision on the matter but rather a public auction is merely a judicial sale conducted by the Court. The issue was settled by the Federal Court in Ranjit Singh A/L Jarnail Singh v. Malayan Banking Bhd [2016] 1 MLJ 165. 10 [48] Furthermore, the Federal Court in Ranjit Singh A/L Jarnail Singh v. Malayan Banking Bhd [2016] 1 MLJ 165 in affirming the Court of Appeal decision in the same case held:- 15 “[I3] The same issues raised before the Court of Appeal were ventilated before us by the Appellant. As stated earlier, the Court of Appeal held there was no contract between the Appellant and the chargee bank ... “ 20 [49] The law as it stand is therefore clear that there is no contractual nexus between the Chargee bank and a bidder at the auction and thus any action based on contract will naturally fail in limine. The learned judge is therefore correct in holding so. Thus, the issue as to whether a chargee bank enforcing its rights 25 by statutory sale gives raise to a contract between the bidder and the chargee bank is settled law. No contract exists between the parties inter-se. On these grounds alone, this appeal should be dismissed as the Appellant/Plaintiff claim was entirely founded on contract. 30 45 [50] The Appellant claims the actual land purchased was lesser than 5 that stated in the title. The learned judge correctly held notwithstanding there was no contractual nexus between the parties, what was offered for sale was a piece of land held under a particular title. There was no representation that a piece of land of any particular size was being offered for sale. The particulars of 10 title were and are at all times correct as reflected in the register of titles. Hence, the learned Judge's finding in paragraph 21 of His Lordship's grounds of Judgement are correct. [See: Page 26 Rekod Rayuan Tambahan]. In short, there was no error in the particulars of title. The learned judge also held there was no other 15 evidence of any representation on the area of the land. [51] The Respondent submitted that there is clear evidence the land was sold on an as-is-where-is basis. Furthermore, the learned j udge correctly held that Clause 23 of the Conditions of Sale 20 were clear and unambiguous in that no misdescription would amount the same and neither would the Purchaser be entitled to any compensation for the same (misdescription). Further thereto, the learned Judge held the Appellant had conceded it was his duty to ascertain the size and area of the land but did not do so 25 for reason of commercial expediency. As such, the learned judge correctly held that estoppel applied. [52] On the claim for damages, the Respondent submitted that no evidence of the value of the shortfall area was led by the 30 46 Appellant. No witnesses were called to ascertain or establish 5 the value of the land that comprised the shortfall. The learned judge's treatment of the burden of proof in his Grounds of Judgment at paragraph 33 of his Grounds of Judgment are correct in law and approach. 10 [53] In conclusion, the Respondent submitted that there is no error in the trial judge's interpretation of the law nor the learned judge’s appreciation of the facts that merit appellate intervention. This appeal is devoid of merit and should be dismissed with costs. 15 OUR DECISION [54] We heard the Appellant’s and the Respondent’s submissions and referred also to their written submissions. We have dealt with each ground raised in the submissions. After deliberation, we found 20 merit in the Appellant’s submission. Hence, it was our unanimous decision that the Appellant’s appeal is allowed with Costs of RM 120,000.00 here and below subject to allocatur. The Appellant is entitled to judgment as prayed in the Statement of Claim. 25 [55] The facts in this case are not disputed particularly where there was a Proclamation of Sale and the Appellant was the successful bidder. The Prolamation of Sales is at page 248 to 253 of the Appeal Record Part C, (Vol. 3A) which consists of particulars of title and importantly showing provisional land area is 94.76 hectares. 30 47 There are also 26 conditions of sales stated therein. The 5 Appellant’s complaint that in effect they purchased the auctioned land with the land area of 81.9945 hectares i.e. 12.7655 hectares less (or 13.48% less). Therefore, they are entiled to damages on the different value of the land area. The Appellant’s case is that the Respondent as the chargee bank/vendor has breached the 10 contract and must be held liable to compensate the Appellant. [56] The main issue is whether there is a contract between the Appellant and the Respondent. The Respondent relied heavily on the Federal Court in Ranjit Singh a/l Jarnail Singh v. Malayan 15 Banking Bhd, supra, where it was submitted that the Federal Court agreed with the Court of Appeal decision in the same case which held that, there was no contract between the Appellant and the chargee bank. In other words the Chargee bank could not be considered to be the Vendor but rather a public auction 20 is merely a judicial sale conducted by the Court. [57] We have read the grounds of judgment of the Federal Court in Ranjit Singh a/l Jarnail Singh v. Malayan Banking Bhd, supra. In our view, the case can be distinguished on facts. The facts in the 25 said case is different from the facts in this present case. In the said case, the property could not be transferred and registered to the appellant due to the private caveat entered by the daughter of the chargor about two months prior to the appellant having paid the full price. Although a certificate of sale was issued to the appellant by 30 48 the court, the sale could not be completed. Since the Certificate of 5 sale could not be registered due to the existence of the caveat and would never be capable of being registered until the end, the title or interest of the property still remained with the chargor. Thus, the appellant could not become the registered proprietor of the property not because the chargee bank had breached the terms of 10 the judicial contract, but because the order for sale was set aside some nine years later. Arguably, there was no breach of contract caused by either party (chargee bank and the appellant biddder) to the condition of sale. In view of that, the Federal Court agreed with the respondent that since the order for sale was set aside, the 15 judicial contract dated 12 September 1990 became null and void, ie. no contract was struck between the respondent and the appellant, and the appellant had been put back to his original position, which means his position before the judicial contract took place (see paragraphs 19 of the said judgment). 20 [58] Further it was held that - “[20] It is our judgment that since there was no breach of contract on the part of the chargee bank, the issue of monetary compensation as 25 claimed by the appellant does not arise...... [21] Since it is our finding that that there was no breach of contract in the first place to entitle the appellant to initiate this suit, in our considered view the claim for damages by the appellant must also 30 fail” 49 [59] Following the above judgment, it can also be a case that had the 5 Court found the order for sale was not set aside, the judicial contract dated 12 September 1990 would be valid and contract was struck. Had a certificate of sale was issued to the appellant by the court and the Certificate of sale was registered, the title or interest of the property would be transfered to the appellant. If there is 10 breach of condition of sales, the appellant being the registered proprietor of the property could take action against the chargee bank for breached of terms of the judicial contract. [60] Therefore, we entirely agreed with the Appellant’s submission. In 15 our view the law still stands that in a forced sale pursuant to Section 256 of National Land Code 1965, the Respondent being the chargee at whose instance the sale is effected is or is to be regarded as the vendor. The order for sale and the conditions of sale are to be regarded as the sale and purchase agreement 20 between the respondents and the purchaser (see:. Malayan United Finance Bhd, Johore Bahru v Liew Yet Lan). [199011 MLJ 317; Mohamed Azmal Noor all Naina Mohd Noor v Arab-Malaysian Finance Bhd & Anor. Thus, even though the conditions for sale is based on the Practice 25 Directions of the Registrar of the High Court, in law it is made by the chargee pursuant to s. 258(2) of the National Land Code [see; Santhi Krishnan v Malaysia Building Society Bhd] 30 50 [61] In the case of Kuala Lumpur Finance Bhd v Yap Poh Khian & 5 Ors [1991] 3 CLJ (Rep) 75, it was held that under a forced sale of a land subject to a charge pursuant to s. 256 of the National Land Code, the fact that the sale is conducted by the Court or its Registrar does not mean that the Court or its Registrar has an interest in the sale or any dispute arising therefrom. The 10 Registrar/licensed auctioneer sells the property as an agent of the chargee who is the real vendor. [62] Therefore, it is our considered view that there is a concluded contract between the Appellant and the Respondent. This is in 15 accordance with settled law that the order for sale and the conditions of sale constitute a sale and purchase agreement between the Respondent being the chargee as the vendor and the Appellant being the successful bidder as the purchaser. 20 [63] We agreed with the Appellant’s submission that the learned trial Judge erred in law when he held that the registered chargee is not liable to pay compensation for losses arising from any judicial sale by public auction by reason of Section 269(3) of the National Land Code 1965. In our considered view, section 269(3) of the 25 National Land Code 1965 does not exempt a chargee from liability for compensation for the losses arising from any judicial sale by public auction. Section 269 (3) of the National Land Code 1965, clearly provides inter alia that, any chargor or purchaser who suffers any loss of damage by reason of any act, omission, neglect, 30 51 error or default arising under this Chapter shall be entitled to such 5 compensation as may be determined by the Court. Chapter means referring to Chapter 3 on Remedies of Chargees: Sale. [64] We agreed with the Appellant that the learned trial Judge erred in law and in fact when he decided that the Proclamation of Sale 10 made no representation as to the size of the land per se but merely set out the particulars of the title. We found the learned judge’s finding has no basis because he failed to consider the express terms set out in the proclamation of sale. It is very clear and undisputed that the Proclamation of Sale showed the size of said 15 land is 94.76 hectares. This was an express term of the contract under the heading of “Butir-Butir Hakmilik” and thus was specifically agreed on between the parties when they entered into the contract. However, the Appellant only received 81.9945 hectares and not 94.76 hectares as stated in the Proclamation of 20 Sale. [65] The evidence provided by SP3 during the trial was not challenged. The difference in size of the land was confirmed by amongst others from the physical inspection conducted by the 25 independent consultant appointed by the Appellant on the said land. It is also supported by the comtempraneous documents in the form of land survey reports and plan prepared for the land title which was confirmed by the Gombak Land Office. The discovery in different size of land by the Appellant was translated into the 30 52 table as shown in the Appellant’s written submission. The 5 methodology used by the Appellant's expert witness, SP3 to calculate the area of the five (5) overlapping lots was not challenged by the Respondent during the trial. In summary, the total overlapping land area comprises Agriculture Land, Primary School, Primary School/Secondary School, Secondary School 10 and Religious School is 12.7655 hectares. [66] We agreed with the Appellant that in this case the “as is where is basis” principle is not applicable since the particulars of title in the Proclamation of Sale that the actual size of the land does not 15 correspond with 94.76 hectares as stated in the particulars of title in the Proclamation of Sale. It is also our view that the size of the said land is an express term of the contract. In actual fact, there was evidence of witness (Witness Statement of Er Ka Wei dated 23.5.2018 (page 49 of RIP-Volume 2) that before bidding for the 20 said land, a land search was conducted and all the particulars of title including the size of 94.76 hectares corresponds with the particulars of title stated in the Proclamation of Sale. The Appellant's expert witness, SP3 testified that there was no acquisition exercise over the said land, to give rise to the 25 overlapping lots (see:Notes of Evidence dated 23.5.2018). [67] We agreed with the the High Court’s finding in Azharin Shaari v Tabung Haji Properties Sdn. Bhd’s case, supra, when it was held that, although the land was sold on the basis of "as is where 30 53 is" the area represented for sale was 55.25 acres. It was on that 5 premise the plaintiff made his offers and subsequently accepted the defendant's offer. It does not lie on defendant to say that “as is where is" meant the plaintiff bought the land represented to be 55.25 acres when it turned out to be 29.5 acres. There is no obligation on the plaintiff to do a search on the land size when the 10 offer was clear the area was for 55.25 acres in respect of 688 lots. Further there was no indication at the material time of any master titles. There was nothing to show the land size was other than what was shown in the advertisement and the defendant's offer. 15 [68] The facts in this case is similar with the above cited case therefore, it is our considered view that the “as is where is basis” principle does not apply herein because there is nothing to show that the size of the said land is other than what was proclaimed in the Proclamation of Sale. The Respondent have failed to provide the 20 size of said land in accordance with the express term stated in the Proclamation of Sale,that is, 94.76 hectares. [69] The learned judge in this case held that the doctrine of caveat emptor is applicable in the present case. In our view, the learned 25 judge’s decision was not correct. We agreed with the Appellant’s submission. We found the Respondent reliance on Condition 6 of the Conditions of Sale which says that “Penawar adalah bertanggungjawab untuk mengenalpasti butir-butir hartanah dan memastikan segala tanggungan serta bebanan hartanah adalah 30 54 tepat” does not have merit. We also found the Respondent’s 5 pleaded case that they are entitled to rely on the professional valuers' report have no merit. The Valuation Report by SP2, shows the said land bearing titled land area of 94.76 hectares. It was submitted that in this report, it clearly states that Sekolah Kebangsaan Bandar Baru Selayang 2 (Title No: PT35818 HS(D) 10 35584) forms part of the surrounding land and not the said land. This piece of evidence was unchallenged and/or uncontradicted. Thus, the learned judge should have accepted the evidence (see: Notes of Proceedings dated 1.6.2018 (pages 216 to 217 of RIP-Supplementary Records of Appeal) 15 [70] it is not disputed that in the valuation report which shows the aerial view of the said land confirms that the said school forms part of the said land and this corroborates the Appellant's expert witness, SP3's report which is unchallenged and/or 20 uncontradicted. It has been submitted earlier that SP1, as a prudent purchaser had conducted a Registry search on the said land; and conducted a physical inspection on the said Land. [71] “caveat emptor” is defined as follows: 25 “The rule is caveat emptor; a purchaser should make inspection and inquiry as to what he is proposing to buy. If he omits to ascertain whether the land is such as he desires to acquire, he cannot 30 55 complain afterwards on discovering defects of which 5 he would have been aware if he had taken ordinary steps to ascertain its physical condition: and although as a general rule a vendor must deliver property corresponding to the description contained in the contract, yet an error in the particulars or 10 description of the property in the contract is not a ground of objection if it is readily corrected on inspection.” [See: Halsbury's Laws of England 4th edn. Vol 42 at p.47] 15 [72] We agreed that the maxim caveat emptor “let the buyer beware” requires that the Appellant as the purchaser to be cautious as the risks was his and not that of the Respondent. The maxim caveat emptor “let the buyer beware” requires that the Appellant as the 20 purchaser to be cautious as the risks was his and not that of the Respondent. However, the principle of caveat emptor and or “let the buyer beware” would not apply to the factual matrix of this case. 25 [73] The learned judge held that Clause 23 of the Conditions of Sale in the Proclamation of Sale precluded the Appellant's claim. This, was on the finding that there was no breach of the condition of sales. However, we did not agree with the learned judge’s decision.We agreed with the Appellant’s submission that this 30 56 Clause is entirely inapplicable. It is not the Appellant's case that 5 there were any easements, caveats, tenancies etc in respect of the said land or that the said land was not correctly described. The Appellant's case is that the said land offered to be sold was of size 94.76 hectares but the Appellant only got 81.9945 hectares i.e. 12.7655 hectares less (or 13.48% less). There is a 10 breach of condition of sales on the different land area sold to the Appellant. Be that as it may, we are of the view that the existence of Clause 23 in the Prolamation of Sale may be contrary to section 296 (3) of the National Land Code 1965 which clearly provides protection to chargor or purchaser who suffers any loss 15 or damage by reason of any act, omission, neglect, error or default arising from the Sale shall be entitled to such compensation as may be determined by the Court. [74] Finally, it is the Appellant's case that it has suffered a loss as it 20 purchased the said land at RM120,000,000.00 for 94.76 hectares. However, as mentioned above and in actual fact, the Appellant only received 81.9945 hectares. The Respondent argued that the Appellant had failed to present evidence on such loss and damages during trial. We agreed earlier that the Appellant is 25 entitled to damages for the loss suffered. In our view, there is sufficient evidence for arriving into quantum of damages. The computation of the loss suffered can be done simply by way of pro-rating i.e. by dividing the purchase price of the said land with the size of the said land, 94.76 hectares which is simple 30 57 mathematical calculation shown in the table provided by the 5 Appellant in their submission above and also in the Statement of Claim. Based on 20,000,000.00 (purchase price) = RM1,266,357.11 per hectare 94.76 hectare (size of the said land) the Appellant's loss for the overlapping lots is RM16.165.681.80. 10 CONCLUSION [75] We were satisfied that there are merits in the Appellant’s appeal. It is our unanimous decision that the appeal is allowed with cost of 15 RM 120,000,00 here and below subject to allocatur. There will be consequential order for the Appellant’s claim as prayed in the Statement of Claim. The order of the High Court dated 22 November 2018 was set aside. 20 Dated 21 January, 2020 Sgd KAMALUDIN MD. SAID 25 JUDGE COURT OF APPEAL MALAYSIA PUTRAJAYA 30 58 5 Parties