Indian Overseas Bank v 1. ) Pemaju Sri Sinar Sdn Bhd (BA-22NCvC-521-12/2022)

PEMAJU SRI SINAR SDN BHD (No. Syarikat: 670078-P)

CRP SERVICES SDN BHD (No. Syarikat: 1142818-K)

SANGKAR A/L VIGIN KUMAL (No. K/P: 801004-08-6383)

MAGENDERAN A/L RAMASAMY (No. K/P: 810903-08-6197)

ELAVARASAN A/L VELOO (No. K/P: 560907-10-5165)

PENDAFTAR HAKMILIK PEJABAT TANAH DAN GALIAN SELANGOR 16/07/2025 08:58:51

KHOO DAK SAN (No. K/P: 550112-06-5367)

SUNBOSCH MACHINERY (M) SDN BHD (No. Syarikat: 200401020527 (659031-D))

READY CASH SDN BHD (No. Syarikat: 202001036805 (1393126-W))

K.S. SECONDARY FIBRE SUPPLIER SDN BHD (No. Syarikat: 199201005392 (236896-K) …DEFENDAN-DEFENDAN JUDGMENT Introduction [1] This case presents a scenario that strikes at the heart of every registered landowner’s worst fears: the sudden discovery that their title or interest in land has vanished. Here, the Plaintiff seeks to reclaim an interest in the form of a charge. The Plaintiff alleges that its interest has been compromised through a series of fraudulent dealings. The land that was charged to the Plaintiff was discovered to have been discharged and transferred to another party. It did not stop there. The said land was further encumbered, with other attempts to transfer the land and to secure a loan from unsuspecting third parties. In the wake of this scheme, a trail of innocent victims is left to bear the consequences orchestrated by the perpetrator(s). The Core Issues [2] The central issue for determination is whether the Plaintiff is entitled to the various reliefs sought against the ten Defendants the Plaintiff has named in this suit. [3] In resolving this primary question, the Court must also consider the competing rights of the Plaintiff as weighed against those of the ten Defendants involved. The Parties and the Salient Background Facts [4] The Plaintiff, Indian Overseas Bank, was the registered chargee of the land which forms the subject matter of this case. The Plaintiff discovered that the said charge had been discharged on 21 March, 2022, leading to the filing of the present action by the Plaintiff on 23 December,

[5] The said land was originally charged to the Plaintiff on 6 October, 2011 by the First Defendant, Pemaju Sri Sinar Sdn Bhd. [6] Sangkar a/l Vigin Kumal and Magenderan a/l Ramasamy are the Third and Fourth Defendants respectively. They are the directors of the First Defendant. [7] The Second Defendant is the present registered owner of the land. Presumably, the First Defendant had transferred the land to the Second Defendant pursuant to a Sale and Purchase Agreement. [8] The Fifth Defendant, Elavarasa a/l Veloo, is a director of the Second Defendant. [9] The Fifth Defendant had entered a Lien-Holder Caveat on the said land on 26 August, 2022, on the basis that the Second Defendant owed him money. [10] The Sixth Defendant is the Pendaftar Hakmilik Pejabat Tanah dan Galian Selangor. [11] The Seventh Defendant, Khoo Dak San, is also a director of the Second Defendant. [12] On 20 February, 2023, the Second Defendant entered into a Sale and Purchase Agreement with Sunbosch Machinery (M) Sdn Bhd, the Eighth Defendant. Pursuant to that Sale and Purchase Agreement, the Eighth Defendant lodged a private caveat over the land on 7 March, 2023. [13] On 9 January, 2023, the Second Defendant took a loan from Ready Cash Sdn Bhd, the Ninth Defendant. As a result of the loan, the Ninth Defendant entered a Lien-Holder Caveat over the said Land. [14] The Second Defendant also entered into another Sale and Purchase Agreement with yet another party. This time it was with K S Secondary Fibre Suppliers Sdn Bhd, the Tenth Defendant. This Sale and Purchase Agreement was dated 26 May, 2023 and as a result of this Sale and Purchase Agreement the Tenth Defendant lodged a private caveat over the said land. The Reliefs Sought by the Plaintiff [15] The reliefs sought by the Plaintiff against all the ten Defendants as per its Amended Statement of Claim (in Enclosure 82) dated 25 June, 2024 were as follows: As against the 1st Defendant

A Declaration that the transfer of the property known as and held under H.S. (D) 4098 PT No.2725 Mukim of Ulu Yam, District of Ulu Selangor with a land area of 20.595 hectares (“the Property”) by the 1st Defendant to the 2nd Defendant is invalid and unlawful;

A declaration that the Plaintiff’s registered charge in Presentation No. 10229/2011 on the Property remains valid and enforceable;

A declaration that the Plaintiff’s purported discharge of charge under Presentation No. 27670/2022 on 21.3.2022 is invalid and unlawful;

A Declaration that the Sale and Purchase Agreement entered between the 1st Defendant and the 2nd Defendant in relation to the sale and/or transfer of the Property is void;

Further or alternatively, damages for breach of the Mortgage Agreement entered between the Plaintiff as the Mortgagee and the 1st Defendant as the Mortgagor and for conversion of the Plaintiff’s registered interest on the Property; As against the 2nd Defendant

A Declaration that the transfer of the Property by the 1st Defendant to the 2nd Defendant is invalid and unlawful;

A Declaration that the Sale and Purchase Agreement entered between the 1st Defendant and the 2nd Defendant in relation to the sale and/or transfer of the Property is void;

An injunction restraining the 2nd Defendant whether by itself, or through its directors, officers, servants, agents or any of them or otherwise, from offering to sell, selling, transferring, causing to transfer, disposing of, causing to dispose of and/or dealing with the Property in any manner whatsoever;

An injunction restraining the 2nd Defendant, whether by itself, or through its directors, officers, servants, agents or any of them or otherwise, from transferring, executing any transfer documents and/or dealing with in any manner with the

An injunction to prevent the 2nd Defendant, whether by itself, or through its directors, officers, servants, agents or any of them or otherwise, from continuing with any agreement or entering any agreement whatsoever to sell the Property to any parties;

A declaration that the 2nd Defendant’s title or interest in the Property is not indefeasible;

An Order that the 2nd Defendant’s title or interest in the Property be set aside;

Further or alternatively, a declaration that the 2nd Defendant is not a bona fide purchaser in good faith and for valuable consideration;

Further or alternatively, damages for conversion of the Plaintiff’s registered interest on the Property; As against the 5th Defendant

An Order that the 5th Defendant’s lien-holder caveat registered as Presentation No. 41280/2022 in the Property be removed and set aside; As against the 2nd to 5th Defendant and the 7th to 10th Defendant o1. A declaration that the sale and purchase agreement dated 20.2.2023 between Sunbosch and the 2nd Defendant in relation to the sale and/or transfer of the Property is invalid and unlawful. o2. An Order that the Sunbosch Machinery’s Private Caveat registered as Presentation No. 9486/2023 be removed and set aside. o3. A declaration that the loan agreement dated 9.1.2023 between Ready Cash and the 2nd Defendant for the sum of RM3,000,000.00 with the Property as security is invalid and unlawful. o4. An Order that the Ready Cash Lienholder Caveat registered as Presentation No. 13489/2023 be removed and set aside. o5. A declaration that the sale and purchase agreement dated 26.5.2023 between KSSF and the 2nd Defendant in relation to the sale and/or transfer of the Property is invalid and unlawful. o6. An Order that the KSSF Private Caveat registered as Presentation No. 28003/2023 be removed and set aside. As against the 1st Defendant to the 5th Defendant and the 7th Defendant jointly and severally

Damages for conspiracy to defraud the Plaintiff;

General damages to be assessed;

Aggravated and exemplary damages; As against the 6th Defendant

An Order that the 6th Defendant shall do all such things as may be necessary forthwith to cancel the issue document of title registered under the name of the 2nd Defendant and issue a document of title for the Property under the name of the 1st Defendant and reinstate the Plaintiff’s registered charge in Presentation No.:102229/2011 pursuant s. 417 of the National Land Code; As against the Defendants jointly and severally

Costs;

Such further or other reliefs as this Court may deem fit. Settlement and Discontinuance [16] The private caveat entered into by the Eighth and Tenth Defendants have been withdrawn and the Plaintiff has reached settlements with both the Eighth and Tenth Defendant (see the Notices of Discontinuance in Enclosure 126 and Enclosure 144 respectively). [17] Likewise, the Lien-Holder Caveat entered by the Fifth Defendant has been removed by the Fifth Defendant on 29 March, 2023. Proceedings against the Remaining Defendants [18] With regards to the action against the remaining Defendants, this Court heard submissions on three Notices of Application on 25 April,

These Notices of Application were Enclosures 106, 109 & 139. Enclosure 139 – Judgment in Default of Defence [19] Enclosure 139 is the Plaintiff’s application to enter judgment in default of Defence against the First, Third, Fourth and Seventh Defendants. The prayers were as follows:

In respect of the property known as and held under H.S. (D) 4098, PT No. 2725 Mukim of Ulu Yam, District of Ulu Selangor with a land area of 20.595 hectares (“the Property”):

1.1. A Declaration that the Plaintiff’s purported discharge of the charge under Presentation No. 27670/2022 on 21.3.2022 is invalid and unlawful;

1.2. A Declaration that the Plaintiff’s registered charge in Presentation No. 102229/2011 on the Property remains valid and enforceable;

1.3. A Declaration that the Sale and Purchase Agreement entered by the 1st Defendant in relation to the sale and/or transfer of the Property to the 2nd Defendant is void ab initio;

1.4. A Declaration that the transfer of the Property by the 1st Defendant to the 2nd Defendant vide Presentation No. 34068/2022 is invalid and unlawful;

In respect of the 1st Defendant:

2.1. Further or alternatively, damages for breach of the Mortgage Agreement entered between the Plaintiff and 1st Defendant and for conversion of the Plaintiff’s registered interest on the Property;

In respect of the 7th Defendant, as the director of the 2nd

3.1. A Declaration that the sale and purchase agreement dated 20.2.2023 between the 8th Defendant and the 2nd Defendant, executed by the 7th Defendant as the director of the 2nd Defendant, in relation to the sale and/or transfer of the Property is invalid and void ab initio.

3.2. A Declaration that the sale and purchase agreement dated 26.5.2023 between the 10th Defendant and the 2nd Defendant, executed by the 7th Defendant as the director of the 2nd Defendant, in relation to the sale and/or transfer of the Property is invalid and void ab initio.

In respect of the 1st, 3rd, 4th and 7th Defendants on a jointly and severally basis:

4.1. Damages for conspiracy to defraud the Plaintiff;

4.2. General damages to be assessed;

4.3. Aggravated and exemplary damages;

4.4. Costs;

Such further or other reliefs as this Court may deem fit. [20] The basis of the application in Enclosure 139 was premised on the failure of these four Defendants to take any steps in the present proceedings. The First, Third, Fourth and Seventh Defendants have not entered an appearance nor filed any Defence. They were also unrepresented. [21] As may be recalled, the First Defendant company had originally charged the said land to the Plaintiff and the Third and Fourth Defendants are its directors. The Seventh Defendant is a director of the Second Defendant company, the current registered owner of the land. [22] Despite the failures by these Defendants to enter an appearance, the Plaintiff was required to proceed with the Suit as if the Defendants had entered an appearance. This is because the Plaintiff’s main prayers in the Suit were for declaratory reliefs. [23] Order 13 rule 6(1) of the Rules of Court 2012 provides as follows: Other claims (O. 13, r. 6)

6.

Where a writ is endorsed with a claim of a description not mentioned in rules 1 to 4, then, if any defendant fails to enter an appearance, the plaintiff may, after the time limited for appearing and upon filing an affidavit proving due service of the writ on that defendant and, where the statement of claim was not endorsed on or served with the writ, upon serving a statement of claim on him, proceed with the action as if that defendant had entered an appearance. [24] The First, Third, Fourth and Seventh Defendants have also failed to file a Defence to the Plaintiff’s claim within the prescribed time under the law. Accordingly, Order 19 rule 7(1) of the Rules of Court 2012 provides as follows: Default of defence: Other claims (O. 19, r. 7)

7.

Where the plaintiff makes against a defendant or defendants a claim of a description not mentioned in rules 2 to 5, then, if the defendant or all the defendants (where there is more than one) fails or fail to serve a defence on the plaintiff, the plaintiff may, after the expiration of the period fixed under these Rules for service of the defence, apply to the Court for judgment, and on the hearing of the application the Court shall give such judgment as the plaintiff appears entitled to on his statement of claim. [25] The Federal Court in Amalan Tepat Sdn Bhd v Panflex Sdn Bhd [2011] 7 CLJ 121; [2011] 5 MLJ 512; [2012] 1 MLRA 475 held that where the main relief sought is a declaration, an applicant must show evidential basis before such relief can be granted by the Court. [13] With respect we are unable to agree with the submission of learned counsel for the respondent. As declaration was the main prayer of the respondent it is a rule of practice that before such relief is granted there must be evidential basis to do so. The courts are very slow in granting declaratory prayer without any evidence and argument advanced. [14] In Gan Boon Kyee v Yap Hong Sin & Anor [1997] 2 MLJ 598 the Court of Appeal said this at p 601: I have read the judgment of the learned judicial commissioner with great care, bearing in mind that this is not the case of an ordinary judgment in default but one of declaratory relief. As observed by Zamir & Woolf on The Declaratory Judgment, (2nd Ed) at p 264: … courts will generally be reluctant to grant a declaration as part of a default judgment in the absence of any evidence and argument. Before the court grants a declaration, it wants to be sure, as in the case of an injunction, that it is appropriate to grant that relief (per Gopal Sri Ram JCA (as he then was)). [15] We are inclined to agree with the dicta in the abovementioned case. (See also Tirumeniyar a/l Singara Veloo v Malaysian Motor Insurance Pool [2017] 6 MLJ 776.) [26] On what constitutes as an evidential basis sufficient to justify the grant of declaratory relief, reference may be made to Muthu Karippen a/l Rajoo v Selliah a/l Muthiayal [2020] AMEJ 1740; [2020] CLJU 1815; [2020] MLJU 2111; [2020] MLRHU 1705. [27] Based on the principles as set out and discussed in the above case, this Court is satisfied that, first, the Plaintiff has pleaded all material facts giving rise to the cause of action against the Defendants in Default. Second, this Court is also satisfied that there is sufficient evidence to support the Plaintiff’s claim against the Defendants in Default. Third, in the absence of a Defence, the Defendants in Default are deemed to have admitted the allegations set out in the Amended Statement of Claim. [28] Hence, the Plaintiff should accordingly be entitled to judgment against all these Defendants. [29] However, it should be noted that the prayers sought by the Plaintiff against the First Defendant has a direct bearing on the rights of the Second Defendant, which is rigorously defended by the Second Defendant. In this regard, the Plaintiff has filed another Notice of Application in Enclosure 109, seeking summary judgment against, amongst others, the Second Defendant. [30] The prayers sought against the Seventh Defendant relate to two Sale and Purchase Agreements/transactions entered into by the Seventh Defendant on behalf of the Second Defendant with the Eighth and Tenth Defendants. These prayers have to all intents and purposes been rendered academic as the Plaintiff has reached a settlement and has filed Notices of Discontinuance against the Eighth and Tenth Defendants. Enclosure 109 – Summary Judgment [31] Enclosure 109 is the Plaintiff’s application for summary judgment against the Second, Fifth, Sixth and Ninth Defendants. [32] The reliefs sought by the Plaintiff in Enclosure 109, made pursuant to Order 14 of the Rules of Court 2012, were as follows:

In respect of the property known as and held under H.S. (D) 4098 PT No.2725 Mukim of Ulu Yam, District of Ulu Selangor with a land area of 20.595 hectares (“the Property”):

1.1. A Declaration that the Plaintiff’s purported discharge of charge under Presentation No. 27670/2022 on 21.3.2022 is invalid;

1.2. A Declaration that the Plaintiff’s registered charge in Presentation No. 102229/2011 on the Property remains valid and enforceable;

1.3. A Declaration that the transfer of the Property to the 2nd Defendant is invalid and void ab initio;

1.4. A Declaration that the Sale and Purchase Agreement entered by the 2nd Defendant in relation to the sale and/or transfer of the Property is void ab initio;

In respect of the 2nd Defendant:

2.1. An injunction restraining the 2nd Defendant whether by itself, or through its directors, officers, servants, agents or any of them or otherwise, from offering to sell, selling, transferring, causing to transfer, disposing of, causing to dispose of and/or dealing with the Property in any manner whatsoever;

2.2. An injunction restraining the 2nd Defendant, whether by itself, or through its directors, officers, servants, agents or any of them or otherwise, from transferring, executing any transfer documents and/or dealing with in any manner with the Property;

2.3. An injunction to prevent the 2nd Defendant, whether by itself, or through its directors, officers, servants, agents or any of them or otherwise, from continuing with any agreement or entering any agreement whatsoever to sell the Property to any parties;

2.4. A declaration that the 2nd Defendant’s title or interest in the Property is not indefeasible;

2.5. An Order that the 2nd Defendant’s title or interest in the Property be set aside;

2.6. Further or alternatively, damages for conversion of the Plaintiff’s registered interest on the Property;

In respect of the 2nd, 5th, and 8th to 10th Defendants:

3.1. A declaration that the sale and purchase agreement dated 20.2.2023 between the 8th Defendant and the 2nd Defendant in relation to the sale and/or transfer of the Property is invalid and void ab initio.

3.2. An Order that the 8th Defendant’s Private Caveat registered as Presentation No. 9486/2023 be removed and set aside.

3.3. A declaration that the loan agreement dated 9.1.2023 between the 9th Defendant and the 2nd Defendant for the loan of RM3,000,000.00 with the Property as security is invalid and void ab initio.

3.4. An Order that the 9th Defendant’s Lienholder Caveat registered as Presentation No. 13489/2023 be removed and set aside.

3.5. A declaration that the sale and purchase agreement dated 26.5.2023 between the 10th Defendant and the 2nd Defendant in relation to the sale and/or transfer of the Property is invalid and void ab initio.

3.6. An Order that the 10th Defendant’s Private Caveat registered as Presentation No. 28003/2023 be removed and set aside.

In respect of the 2nd and 5th Defendants on a jointly and severally basis:

4.1. General damages to be assessed;

4.2. Aggravated and exemplary damages;

In respect of the 6th Defendant:

5.1. An Order that the 6th Defendant shall do all such things as may be necessary forthwith to cancel the issued document of title registered under the name of the 2nd Defendant and issue a document of title for the Property under the name of the 1st Defendant and reinstate the Plaintiff’s registered charge in Presentation No.:102229/2011 pursuant Section 417 of the National

In respect of the 2nd, 5th, 6th, and 8th to 10th Defendants jointly and severally:

6.1. Costs;

6.2. Such further or other reliefs as this Court may deem fit. [33] In support of its application for summary judgment, the Plaintiff highlighted the following facts, namely, that:

Pursuant to a Letter of Offer dated 28.4.2011 and a Facility Agreement, Plaintiff agreed to grant credit facilities to Clever Setup Sdn Bhd (“the Borrower”) with the 1st Defendant acting as the corporate guarantor.

The Borrower, Plaintiff and the 1st Defendant subsequently entered into a Mortgage Agreement whereby the 1st Defendant, as the Mortgagor, inter alia, agreed to mortgage (charge) all its registered estate or interest in the Property to the Plaintiff.

On 6.10.2011 the charge was duly registered vide Presentation No. 102229/2011 (“the Charge”). The original issue document of title of the Property has been and is still in Plaintiff’s custody and possession since 10.4.2012.

On or around 8.12.2022, Plaintiff discovered that the quit rent statement of the Property has named the 2nd Defendant as the owner of the Property. Later, on or about 14.12.2022, Plaintiff discovered that the Charge was purportedly discharged by Plaintiff on 21.3.2022 vide Presentation No.: 27670/2022.

The Plaintiff’s representatives, Ng Shock Hoon and Shri Venkatachalam Vasudevan (“Plaintiff’s Representatives”) who purported to have executed the discharge documents affirmed that they had not sighted the discharge documents. The solicitor, Mr Azwan bin Abdul Wahab who purportedly witnessed the execution of the discharge documents and the Commissioner for Oaths, Mr HJ Wan Azman bin HJ Wan Abdullah both denied having met the Plaintiff’s Representatives or witnessed their signatures on the discharge documents.

The Plaintiff then obtained an Ad Interim Injunction Order on 28.12.2022 against the 2nd Defendant to, amongst others, prevent, restrain and/or prohibit the 2nd Defendant whether by itself or through its directors from dealing with the Property.

The Ad Interim Injunction Order was served personally by the Plaintiff and was duly received by the 2nd Defendant on 3.1.2023. An affidavit of service evidencing the service of the Ad Interim Injunction Order to the 2nd Defendant was duly affirmed and filed with this Honourable Court on 10.1.2023 (see Affidavit of Service of the Ad Interim Injunction Order affirmed by Edmorgan Laisin dated 10.1.2023 (Enclosure 11)). Accordingly, the 2nd Defendant would have notice of and thus was fully aware of the terms of the Ad Interim Injunction Order.

Subsequently, Plaintiff discovered that: h.1. a private caveat was lodged on the Property by the 8th Defendant,

Thereafter, pursuant to another Private Land Search dated 8.1.2024, Plaintiff discovered that another private caveat had been lodged on the Property by the 10th Defendant, K.S. Secondary Fibre Supplier Sdn Bhd (Company Registration No.: 199201005392 (236896-K)) on 27.6.2023 pursuant to a sale and purchase agreement dated 26.5.2023 between the 10th Defendant and the 2nd Defendant for the sale of the Property.

The 8th, 9th and 10th Defendants were not aware that there was such a pending legal proceeding between the Plaintiff and the 1st to 6th Defendants in relation to the Property prior to them entering into the subsequent transactions mentioned above with the 2nd Defendant. This has been evidenced in the 9th and 10th Defendant’s Defence and various letters issued by the 8th Defendant to the Plaintiff.

The 2nd Defendant actions after the grant of the Ad Interim Injunction Order by the Court clearly show their mala fide intentions to dispose of the Property.

Given the above affirmations by Plaintiff’s representatives, the evidence of the solicitor and Commissioner for Oaths who denied witnessing the execution of the discharge documents and the 2nd Defendant’s intentions to dispose of the Property after the grant of the Ad Interim Injunction Order by the Court, the 2nd, 5th, 6th, and 8th to 10th Defendants, therefore, has no defence against the Plaintiff’s claim in this action herein. [34] The Plaintiff averred that it has complied with the preliminary requirements of Order 14 of the Rules of Court 2012 and that there are no bona fide triable issues in this action herein. [35] On the absence of triable issue(s), the Plaintiff alluded to the following grounds, namely, that first, the principle of deferred indefeasibility applies in Malaysia. The Plaintiff cited the Federal Court case of Tan Ying Hong v Tan Sian San & Ors [2010] 1 AMR 557; [2010] 2 CLJ 269; [2010] 2 MLJ 1; [2010] 1 MLRA 1 in support of this trite proposition. [36] Second, the Plaintiff submitted that there were vitiating factors pursuant to section 340(2)(b) of the National Land Code. The Plaintiff argued that the Second Defendant’s title over the property is defeasible pursuant to section 340(2)(b) of the National Land Code. The point advanced by the Plaintiff was that a registered interest is defeasible if the registration were obtained by “forgery” or by means of an “insufficient or void instrument”. [37] The Plaintiff asserted that the Second Defendant’s “bona fide purchaser defence must fail”. [38] The Plaintiff cited the Federal Court cases of Kamarulzaman bin Omar & Ors v Yakub bin Husin & Ors [2014] 1 AMR 493; [2014] 1 CLJ 987; [2014] 2 MLJ 768; [2014] 2 MLRA 432 and Samuel Naik Siang Ting v Public Bank Bhd [2018] 3 AMR 259; [2015] 8 CLJ 944; [2015] 6 MLJ 1; [2015] 5 MLRA 665. [39] It was also contended by the Plaintiff that the proviso to section 340(3) of the National Land Code does not apply to the Ninth Defendant. This is because the Second Defendant “is an immediate purchaser, and not, a subsequent purchaser”. [40] In addition, it was submitted by the Plaintiff that the Ninth Defendant “failed to plea that the proviso under section 340(3) of the NLC applies” and notwithstanding that point, the Plaintiff submitted as follows:

(M) Sdn Bhd (Registration No.: 200401020527 (659031-D)) pursuant to a sale and purchase agreement dated 20.2.2023 entered with the 2nd Defendant. Plaintiff further discovered that the sale and purchase agreement was signed by the 5th Defendant and the 7th Defendant as the directors of the 2nd Defendant. h.2. a Lienholder Caveat was lodged on the Property by the 9th Defendant, Ready Cash Sdn Bhd (Registration No.: 202001036805 (1393126-W)) pursuant to a loan agreement dated 9.1.2023 between the 9th Defendant and the 2nd Defendant for the loan of RM3,000,000.00 with the Property as security.

… we submit that even if the 9th Defendant pleaded the defence of ‘bona fide purchaser’ (which we deny), the 9th Defendant cannot seek protection under the proviso to Section 340(3) of the NLC, as the 9th Defendant is not currently registered as a chargee of the Property.

As stated above, the 9th Defendant’s interest in the Property purportedly arose from the Ready Cash Loan Agreement entered into with the 2nd Defendant for the sum of RM3,000,000.00, with the Property allegedly serving as security. However, at no point did the 9th Defendant proceed to register a charge on the Property pursuant to the Ready Cash Loan Agreement. This omission is not merely procedural but strikes at the heart of the 9th Defendant's purported defence, as the absence of registration precludes any proprietary claim over the Property under the Torrens system.

As such, Section 340(3) of the NLC is not applicable to the 9th Defendant. This was explained by the Federal Court in Liputan Simfoni Sdn Bhd v Pembangunan Orkid Desa Sdn Bhd [2019] 4

MLJ 141 (FC) … Since the 9th Defendant’s charge was never registered, the defence of ‘bona fide purchaser’ cannot be invoked.

Following the Federal Court’s decision in Liputan Simfoni Sdn Bhd, the 9th Defendant has no proprietary claim over the Property. The 9th Defendant merely holds alleged contractual rights against the 2nd and 5th Defendants. These rights do not bind the land but remain enforceable only between the contracting parties to the Ready Cash Loan Agreement, i.e. the 2nd Defendant.

Accordingly, the question of whether the 9th Defendant is a bona fide purchaser or whether the proviso to Section 340(3) of the NLC applies is wholly irrelevant.

Based on the above, we submit that this Summary Judgment Application should be allowed by this Honourable Court because the Plaintiff has successfully fulfilled the three (3) pre-conditions above and the Defendants failed to prove that there exist any triable issues as the Defendants have no bona fide defence to the Plaintiff’s claim. [41] It is apparent that the Sixth Defendant is a nominal defendant in this Suit. [42] As for the Second and Fifth Defendants, they have not filed any affidavit nor written submissions to challenge the present application in Enclosure 109 for summary judgment. [43] The Ninth Defendant, as noted, had given a loan to the Second Defendant and as a result of the loan, the Ninth Defendant entered a Lien-Holder Caveat over the said Land. [44] The Ninth Defendant opposed the Plaintiff’s summary judgment application on the singular ground that “the Plaintiff’s pleaded cause of action against all the Defendants [sic] premised on the allegation of the fraudulent and forgery conveyance which ought to be dealt with by way of a full trial and cannot be resolved by way of the summary process”. [45] In reply to the Ninth Defendant’s submission, the Plaintiff averred that the Ninth Defendant has no interest in the Property because: first, the Loan Agreement was invalid “as the 2nd Defendant lacks the capacity to contract with the 9th Defendant in relation to the Property”; second, the lien was invalid “as the 2nd Defendant lacks the capacity to place a lien on the Property as security for a loan from the 9th Defendant pursuant to the NLC, and in derogation of the Plaintiff’s priority rights as the lawful chargee under the NLC; and third, the Lien-Holder Caveat was wrongly entered on the Property. [46] Upon a careful consideration of the submissions by the Plaintiff and the Ninth Defendant, together with the relevant principles and authorities governing this aspect of practice and procedure, this Court is of the considered view that this is a proper case for summary judgment be entered in favour of the Plaintiff. Enclosure 106 – Plaintiff’s Application to Strike Out the Ninth Defendant’s Counterclaim [47] In Enclosure 106, the Plaintiff sought the following prayers:

That the Counterclaim by the 9th Defendant, Ready Cash Sdn Bhd as set out in the 9th Defendants Defence and Counterclaim dated 28.8.2024 (“9th Defendant’s Counterclaim”) against the Plaintiff be struck out;

Consequently, if the 9th Defendant’s Counterclaim is struck out against the Plaintiff, an order that the Counterclaim by the 9th Defendant, Ready Cash Sdn Bhd against the 2nd, 5th, and 6th Defendant be struck out or alternatively, be tried separately from the Plaintiff’s claim;

That the costs of this Application and the Plaintiff’s Defence to the 9th Defendant’s Counterclaim be borne by the 9th

Such further or other reliefs as this Court may deem fit and proper. [48] It is necessary to recap the Ninth Defendant’s counterclaim. A plain reading of the Ninth Defendant’s counterclaim reveals that the Ninth Defendant’s causes of action are premised on fraud, misrepresentation and negligence committed by the Second, Fifth and Sixth Defendants respectively. [49] Hence, this Court is in agreement with the Plaintiff that the Ninth Defendant has not made any allegations against the Plaintiff nor has the Ninth Defendant any cause of action against the Plaintiff. [50] This Court also agrees with the Plaintiff’s submissions that if the Ninth Defendant indeed has causes of actions against the Second, Fifth and Sixth Defendants the proper procedure would be for the Ninth Defendant to issue a third-party notice and/or commence a fresh action against these other Defendants. The Ninth Defendant’s claims against these other Defendants does not constitute a counterclaim against the Plaintiff. [51] Accordingly, the Plaintiff’s application in Enclosure 106 is allowed. The Orders [52] Considering that the prayers in the Amended Statement of Claim in Enclosure 82 and those in Enclosure 106 and Enclosure 139 overlap to a great extent, together with subsequent events such as the discontinuance of the action by the Plaintiff against the Eighth and Tenth Defendants and the removal of the Lien-Holder Caveat by the Fifth Defendant, this Court makes the following orders. [53] As against the First Defendant, this Court allows the reliefs in paragraph 49(a), (b), (c) and (d) of the Amended Statement of Claim. [54] Following the above, this Court allows, as against the Sixth Defendant, the relief in paragraph 49(s) of the Amended Statement of Claim. [55] As against the Second Defendant, this Court allows the reliefs in paragraph 49(f) – (l) of the Amended Statement of Claim. [56] As against the Ninth Defendant, the Court allows the reliefs in paragraph 49(o3) – (o4) of the Amended Statement of Claim. [57] The Plaintiff is entitled to costs of RM5,000.00 from each of the following Defendants, namely, the First, Second, Third, Fourth, Fifth, Seventh and Ninth Defendants. The award of costs against the Ninth Defendant is made on the basis of Enclosure 106. Dated: 18 June, 2025 sgd [CHOONG YEOW CHOY] Judicial Commissioner High Court of Malaya Shah Alam Counsel: Oon Thian Seng with Rahul bin Farhan Menon and Ng May for the Plaintiff (Messrs. T S Onn & Partners) Murugayah a/l Balasubramaniam for the 2nd and 5th Defendants (Messrs. Murugayah Balasubramaniam & Co.) Muhammad Shah Faris bin Kamarulzaman or the 6th Defendant (Pejabat Penasihat Undang-Undang Negeri Selangor) Mohd Fairus bin Ismail for the 9th Defendant (Nith Gowri Lachman & Partners)