Subsection
(1966) Sdn Bhd v How Swee Poh [1970] 1 MLJ 145; [1969] 1 LNS 116; Haroon v Nik Mah [1951] MLJ 209; Jit Kaur v Pari Singh [1974] 2 MLJ 199; [1974] 1 LNS 57 and Butler v Fairclough & Anor (1917) 23 CLR 78 at p 91). [27] In a New Zealand case of Miller v Minister of Mines and Attorney General of New Zealand [1963] AC 484 at p 497, the Privy Council observed that: The caveat procedure is an interim procedure designed to freeze the position until an opportunity has been given to a person claiming right under an unregistered instrument to regularise the position by registering the instrument. [33] In our considered view, Zemine Development Sdn Bhd v Hong Kong Realty Sdn Bhd could not support the respondent's case: it is clearly distinguishable on the facts. In that case, the appellant as the land owner entered into a joint venture agreement with the respondent to develop residential and commercial buildings. Under that agreement, a sharing arrangement was agreed to where the appellant will be entitled to 20% of the buildings built while the respondent will retain the remaining 80%. The Court of Appeal affirmed the High Court's decision and held that the 8 respondent has a caveatable interest in the land by virtue of its entitlement to 80% of the subdivided lots of the land. However in our case here, what the respondent had under the JVPM agreement was not any share in the subdivided lots or units of buildings on the land, but merely a share in the profits under the GDV. It is purely a share in the profits and not in the land. [35] It is our considered view, therefore, that based on the provisions of the NLC and the authorities cited above, the only parties who are authorised to lodge a private caveat are those who may effect dealings in the particular interests in the land. Those parties may either have a claim to the title to the land or a claim to a registrable interest in the land or a claim to any right to such title or registrable interest. [36] Emphasis should be given to the words 'registrable interest' in s 323(1)(a) of the NLC. To be caveatable, the interest must be an interest in the land and that interest must be capable of registration. In short, it must represent a transaction that can ultimately lead to its registration on the register. [37] Reverting to this appeal before us, although the appellant has conferred numerous rights on the respondent under the JVPM agreement and the powers of attorney, all these rights are merely rights to develop the land that would give rise only to a monetary interest, ie a right in personam against the appellant and does not create any interest in the land. [38] Under the NLC, these rights are not capable of registration. They do not fall under any scheme of dealings in alienated lands as provided under Division IV of the NLC. PRESENT INTEREST AS OPPOSED TO POTENTIAL INTEREST [39] It is also our considered view that the caveator under s 323(1)(a) of the NLC must have a present interest as opposed to a potential interest in the land. The registrable interest that the caveator is claiming for, must be an existing interest. The caveator under s 323(1)(a) of the NLC must be limited to those who are claiming to an existing interest in the land or right to such existing interest and cannot include potential interest or interest in futuro. 9 [40] This principle is firmly embedded in our Torrens system. This can be seen in the decision of the Supreme Court in Tan Heng Poh v Tan Boon Thong & Ors [1992] 2 MLJ 1. In that case, a caveat lodged by a residuary beneficiary was ordered to be removed because the administration of the estate was still incomplete at the time the caveat was lodged, as such his interest in the land was still unascertainable. [44] In the present case, even though the respondent was given the option to purchase the units it developed and transfer the units to itself if it chooses to do so, that right has yet to be exercised at the time when the caveat was lodged. Therefore, the right has not ripened into an interest in the land. [45] As we have alluded to earlier, a caveat is purely a creature of statute and can only be lodged and maintained according to the statute by a person who is authorised to do so by the statute. Parties cannot by agreement between themselves create a caveatable interest. As was rightly held in Wong Kuan Tan v Gambut Development Sdn Bhd [1984] 2 MLJ 113, 'the contractual provision does not amount to an equitable or other interest sufficient to support a caveat.' A contract cannot override a statute by inventing a right which is not recognised by statute. The court could not give recognition to such a right (see Luggage Distributors (M) Sdn Bhd v Tan Hor Teng @ Tan Tien Chi & Anor). [46] Any private caveat lodged outside the scope of s 323 of the NLC is bound to be removed. The burden is on the caveator to show that his caveat is within the scope of s 323 of the NLC. The respondent, as the caveator, failed to discharge that burden.” [emphasis added] Application of laws to the facts of the present case [21] Although the specific terms of a joint venture agreement may under certain circumstances confer proprietary right or interest in the land upon the developer (as was decided in the Federal Court case of Score Options, in our present case, the High Court has held that the Joint Venture Agreement has been validly terminated, and the Defendant’s stay application to the Court of Appeal has been dismissed. The position as between the parties now, in light of the High Court’s decision which upheld the termination of the Joint Venture Agreement and the Court of Appeal’s refusal of stay, is that 10 the High Court’s Order dated 13.01.2022 in Suit No. 425 (as reproduced in paragraphs [6] above] still operates and in force. As such, there is no valid subsisting Joint Venture Agreement upon which the Defendant can argue as its basis for creating or conferring a caveatable interest upon it in respect of the development land. See the cases of Thien Lip Kuen v. Tiow Wee Kong [2016] 1 LNS 720, Ganding Maju Sdn Bhd v. KS Property Development Sdn Bhd and Affin-ACF Finance Berhad (Third Party) [2007] MLJU 690, and Matair Suhaili v. Rose Foo Chin Lan [2007] 5 CLJ 406. [22] The legal position may probably be different if the High Court or the Court of Appeal has granted a stay of the High Court order which upheld the termination of the Joint Venture Development. This is because in the definition clause of the Joint Venture Agreement here, “Company’s Lots” means all the Lots comprised in the Project excluding the Owner’s Lots (if any), “Lots” means the subdivided individual lots together with the buildings, if any, to be erected thereon … including the individual parcels comprised in any stratified building in the Project; Section 3.03(a) read with paragraph 3 Company’s Entitlements stipulated that “Subject to the Owner’s entitlements hereinbefore stated, the Company shall be entitled to all the Lots in the Project, legally and beneficially, and all whatsoever monies, profits, incomes and/or proceeds of sale directly and indirectly derived therefrom”. If not terminated, the Joint Venture Agreement would confer upon the Defendant-developer proprietary rights and/or interest in the Lots as well as monetary entitlement. These clauses of the Joint Venture Agreement, if not terminated, may probably confer a caveatable interest upon the Defendant-developer here - similar to that of the developer in Zemine Development Sdn Bhd v Hong Kong Realty Sdn Bhd [2011] 4 MLJ 466, [2009] 5 CLJ 218 (Court of Appeal). [23] At this point of time, with the Joint Venture Agreement held as validly terminated by the High Court and with no stay of the Court Order granted, it is not open to this Court to hold that the Defendant still has any caveatable interest in the land. [24] In the premises, being bound by the principles laid down in appellate court’s decisions, this Court holds that as at present, the Defendant in the eyes of the law has no caveatable interest in the land by reason of the aforesaid. 11 [25] As the Defendant has no caveatable interest now, the private caveat should be removed and it is not necessary to consider the other factors on removal of private caveat. [26] This Court finds that as the express terms of the Joint Venture Agreement in the pending appeal stipulated for the Defendant to lodge private caveat on the land and the Defendant acted bona fide upon the express terms of the Agreement which was signed by the Plaintiff and the Defendant’s primary motive is to preserve the status quo pending the outcome of the appeal, there should be no order as to assessment of damages. Conclusion [27] In conclusion this Court held on 19.10.2022 that the private caveat lodged on or about 20.4.2022 should be cancelled and removed with costs. [28] Accordingly, this Court on 19.10.2022 made the following orders: