Kaiser Gurmeet Bin Abdullah v Poh Fook Looi (BA-22NCvC-432-10/2023)

AINUR SYAKINA BINTI AZMAN ... PLAINTIFFS

TETUAN AZAM IDZHAM AZMAN & PARTNERS (sued as a firm) …DEFENDANTS GROUNDS OF JUDGMENT Introduction

This action arises from a failed sale and purchase of a three-storey bungalow known as No. 2, Jalan Sering Ukay Utama, Selangor ("the Property"). By a Sale and Purchase Agreement dated 20 October 2017 ("the SPA"), the Plaintiffs agreed to 16/07/2026 09:48:58 BA-22NCvC-432-10/2023 Kand. 96 S/N Yiyax0mwxUei0M/9MWvZA purchase the Property from the 1st Defendant for RM5,400,000.00. The 2nd Defendant is an advocate and solicitor who was materially involved in the transaction, while the 3rd Defendant is the firm through which he practised.

The Plaintiffs seek rescission and termination of the SPA, repayment of RM1,550,000.00 paid towards the purchase price, damages arising from breach of contract, misrepresentation and professional negligence, interest and costs. The 1st Defendant denies liability and contends that the Plaintiffs themselves failed to pay the balance purchase price within the agreed completion period. The 2nd and 3rd Defendants deny that any solicitor-client relationship existed at the relevant stage, deny negligence, and counterclaim for professional fees.

The central fact is not in dispute. A private caveat lodged by Wan Qi Yi had been registered against the Property on 14 April 2017, more than six months before the SPA was executed. The caveat remained subsisting on 20 October 2017. The controversy concerns whether the Plaintiffs had knowingly accepted that caveat, the legal effect of the SPA provisions concerning title and encumbrances, and the respective responsibilities of the Vendor and the solicitors.

In my judgment, the dispute is ultimately governed by the proper construction of the SPA as a whole. The parties had reduced their bargain into a professionally prepared written agreement. The Court must give effect to that document and cannot S/N Yiyax0mwxUei0M/9MWvZA reconstruct the bargain through disputed oral recollections after the event.

For the reasons which follow, I find that the Plaintiffs have proved their claim on the balance of probabilities. The SPA represented the Property as being sold free from undisclosed encumbrances; the private caveat was not disclosed; the 1st Defendant was in breach of the express contractual framework; and the 2nd and 3rd Defendants failed to exercise the reasonable care and skill required of solicitors handling the transaction. Background Facts

The Plaintiffs became interested in the Property in May 2017. The 2nd Defendant knew the Plaintiffs socially and was also acquainted with the 1st Defendant, who lived in the same neighbourhood. The 2nd Defendant introduced the proposed purchase, communicated with both sides and arranged the initial discussions.

The contemporaneous WhatsApp communications showed that the 2nd Defendant conveyed the Plaintiffs' interest to the 1st Defendant and relayed the proposed price and payment structure. On 1 June 2017 he informed the 1st Plaintiff that the price of RM5,400,000.00 with an initial deposit of RM500,000.00 represented the best terms he could negotiate S/N Yiyax0mwxUei0M/9MWvZA for the Plaintiffs. A letter dated 1 July 2017 was subsequently issued under the 3rd Defendant's letterhead confirming the commercial arrangement.

The Plaintiffs made six payments: RM500,000.00 on 2 July 2017, RM300,000.00 on 1 August 2017, RM300,000.00 on 29 August 2017, RM150,000.00 on 3 October 2017, RM150,000.00 on 2 November 2017 and RM150,000.00 on 18 December 2017. The total paid was RM1,550,000.00. A substantial portion was paid before the SPA, with the remaining instalments paid after execution.

The SPA was executed on 20 October 2017. It prescribed a completion period of sixteen months and a staged payment arrangement. It also contained provisions governing payment by cash and by loan, the status of the Property, warranties by the Vendor, removal of encumbrances, suspension of payment and the consequences of default.

The official land search later obtained by the Plaintiffs disclosed the private caveat registered on 14 April 2017. The 1st Defendant accepted during cross-examination that the caveat pre-dated the SPA and remained in existence at the date of execution. The parties differed sharply on whether the caveat had been orally disclosed before the SPA. S/N Yiyax0mwxUei0M/9MWvZA

The Plaintiffs' evidence was that they only became aware of the caveat in December 2017 while pursuing bank financing. They thereafter raised the matter with the 1st Defendant at a meeting in January 2018 and requested that the transaction be regularised through a revised SPA. The caveat was removed in February 2018. No revised SPA was ultimately executed, and the transaction did not proceed to completion.

The 1st Defendant maintained that the caveat had been disclosed at the initial meeting and that the Plaintiffs knowingly entered a cash-instalment transaction. He further relied on the later removal of the caveat and on the Plaintiffs' failure to continue the instalments or to complete the balance purchase price.

The 2nd Defendant maintained that his early involvement was merely personal and introductory. He said that no formal retainer existed before the SPA and that he had received no instruction to conduct a title search. The documentary evidence, however, showed that he negotiated, communicated the agreed terms, issued correspondence on the firm's letterhead, handled or transmitted payments, and remained involved in the drafting and proposed revision of the SPA. S/N Yiyax0mwxUei0M/9MWvZA Evidence Adduced The Plaintiffs’ evidence

The 1st Plaintiff testified that he trusted the 2nd Defendant both as a friend and as the solicitor handling the proposed purchase. He said he did not receive any clear advice before execution that the Property was subject to the private caveat. He relied on the SPA, the solicitors and the apparent ability of the transaction to proceed.

The 1st Plaintiff maintained that financing was always contemplated. He relied on Clause 6A.2, which expressly dealt with payment by loan. He accepted in cross-examination that the SPA also contained a cash-payment provision and a sixteen-month instalment schedule, but denied that the transaction was contractually confined to cash alone.

The 1st Plaintiff's evidence was not entirely free from difficulty. During cross-examination he was confused at times about the identities of two persons referred to as "Poh", the precise course of certain meetings, and the reason the bank did not approve financing. No bank officer was called, and no formal rejection letter stated that the caveat was the sole reason for non-approval. I have taken those weaknesses into account.

The 2nd Plaintiff largely corroborated that the Plaintiffs relied on the 2nd Defendant and that the caveat was raised only after the SPA. Her knowledge of the technical details was limited, as she S/N Yiyax0mwxUei0M/9MWvZA had left the transaction principally to the 1st Plaintiff. Her evidence nevertheless supported the occurrence of the meetings and the Plaintiffs' attempt to address the caveat and obtain a revised agreement. The 1st Defendant’s evidence

The 1st Defendant accepted that he was the registered owner and Vendor and that the private caveat existed when the SPA was executed. His principal explanation was that the Plaintiffs already knew of the caveat. He said the purchase was agreed as a long-term cash transaction and that the Plaintiffs later sought to change the contractual structure because they could no longer sustain the instalments.

The 1st Defendant placed considerable emphasis on the letters issued by Messrs Shearn Delamore & Co in May and June 2018, which referred to replacing the SPA and restructuring the payment terms to facilitate a bank loan but did not expressly identify the caveat as the reason for the proposed replacement. He submitted that those letters demonstrated that the caveat was an afterthought.

Under cross-examination, however, the 1st Defendant was unable to identify any provision stating that payment must be made "by cash only". He accepted that Clause 6A.2 existed and provided for payment by loan. He also sought at times to S/N Yiyax0mwxUei0M/9MWvZA distance himself from the SPA by saying that it had been prepared by the lawyers, notwithstanding his status as Vendor and signatory. The 2nd Defendant’s evidence

The 2nd Defendant described himself as an introducer at the commencement of the dealings. He denied that the Plaintiffs had retained him to advise on every legal aspect before the SPA and denied that he had been instructed or paid to conduct a land search. He further maintained that the Plaintiffs knew of the caveat and that their financing difficulties arose from their own financial capacity.

The contemporaneous documents did not support a purely social role. The 2nd Defendant negotiated and relayed the terms, communicated that he had negotiated "for" the Plaintiffs, used the firm's letterhead, participated in the conveyancing documentation and remained the principal legal contact. His conduct was consistent with professional responsibility, not with the position of a disinterested friend. Submissions of the Parties The Plaintiffs’ submissions

The Plaintiffs submitted that the case was determined by the written SPA. They relied on Recital D and Clause 1, under S/N Yiyax0mwxUei0M/9MWvZA which the Property was sold free from encumbrances subject only to matters disclosed in Part 2B of the Schedule. Part 2B disclosed the CIMB Bank charge but did not disclose Wan Qi Yi's private caveat. They relied further on Clause 12.1(e), Clause 12.2, Clause 12.3 and Clause 14.1 as part of a coherent contractual allocation of title risk to the Vendor.

Clause 12.1(e) stated, to the best of the Vendor's knowledge and belief, that there was no prohibitory order against the Property or any proceedings filed or pending which would result in a prohibitory order or caveat of any kind being lodged against it. Clause 12.2 required a breach of warranty to be rectified within fourteen days of notification, failing which the Purchaser could terminate and invoke Clause 8. Clause 12.3 expressly recorded that the Purchasers entered the SPA in reliance upon the Vendor's declarations, representations, warranties and covenants and could treat them as conditions.

The Plaintiffs argued that the SPA, read as a whole, represented that no undisclosed private caveat affected the Property. If the parties had truly agreed that the existing caveat was known and accepted, the agreement should have expressly identified it. They relied on Lee Chin Cheng Dengkil Oil Palm v Kaplands Sdn Bhd [2003] 1 MLJ 177 and Quality Concrete Holdings Bhd v Classic Gypsum Manufacturing Sdn Bhd & Ors [2012] 2 MLJ 537. S/N Yiyax0mwxUei0M/9MWvZA

The Plaintiffs further submitted that Clause 6A.2 defeated the Defendants' assertion of a cash-only bargain. Clauses 14 and 16 did not excuse the original non-disclosure or permit an inaccurate title representation. The subsequent removal of the caveat could not retrospectively erase the breach. Their efforts to negotiate a revised SPA were attempts to salvage the transaction, not affirmation or waiver.

Against the 2nd and 3rd Defendants, the Plaintiffs submitted that the solicitor-client relationship was established by conduct. The solicitors failed to verify and advise on the title, failed to reconcile the caveat with the SPA, and allowed the Plaintiffs to remain exposed after paying RM1,550,000.00. The 1st Defendant’s submissions

The 1st Defendant submitted that the Plaintiffs knowingly entered an unconventional cash-instalment purchase. He relied on Clause 4, the sixteen-month completion period, the RM1.1 million deposit and the subsequent RM150,000.00 instalments. He argued that the Plaintiffs' own conduct was inconsistent with a transaction dependent on bank financing.

The 1st Defendant contended that the caveat had been disclosed at the outset, was removable under Clause 14 and was in fact removed well before the completion date. Clause 16 entitled the Plaintiffs to suspend payment while a caveat S/N Yiyax0mwxUei0M/9MWvZA remained, but they never invoked it. He distinguished Theresa Toyat & Anor v KHL Sdn Bhd [2015] 5 MLJ 31 because the vendor in that case failed to remove the encumbrance by completion, whereas the caveat here was removed.

He also relied on the absence of a bank witness or rejection letter, the Shearn Delamore correspondence, the Plaintiffs' failure to terminate promptly and their long delay before commencing proceedings. He maintained that the Plaintiffs were in default and that the deposit was forfeitable under Clause 7.1(b). The 2nd and 3rd Defendants’ submissions

The 2nd and 3rd Defendants submitted that no retainer existed at the material stage and therefore no duty of care arose. They relied on the substantial payments made before the SPA as demonstrating that the Plaintiffs acted upon their own commercial judgment rather than on any representation by the 2nd Defendant.

They relied on Kheng Chwee Lian v Wong Tak Thong [1983] 2 CLJ 191 for the need to prove an untrue representation, reliance and inducement. They denied causation, contending that the transaction failed because the Plaintiffs could not pay and could not obtain financing, not because of any act or S/N Yiyax0mwxUei0M/9MWvZA omission of the solicitors. They sought dismissal of the claim and judgment on their counterclaim for fees. Issues for Determination

The issues may be stated as follows:

(a) the proper construction of the SPA;

(b) whether the existing private caveat constituted a breach of the Vendor's contractual obligations and warranties;

(c) whether the Plaintiffs had knowingly accepted the caveat;

(d) whether the SPA was confined to payment by cash;

(e) the effect of Clauses 14 and 16 and the later removal of the caveat;

(f) whether the Plaintiffs affirmed or waived the breach;

(g) whether the 2nd and 3rd Defendants owed and breached a professional duty; and

(h) the appropriate relief. Analysis and Findings The SPA as the governing instrument

The starting point is the SPA. It is a detailed written agreement prepared in a conveyancing transaction and signed by the Plaintiffs and the 1st Defendant. The Court must construe it S/N Yiyax0mwxUei0M/9MWvZA objectively and as a whole. It is not permissible to isolate one clause while depriving another operative provision of effect.

Sections 91 and 92 of the Evidence Act 1950 reinforce that approach. In Quality Concrete Holdings, the Court of Appeal reaffirmed that once the parties have reduced their agreement into writing, extrinsic evidence cannot ordinarily be admitted to contradict, vary, add to or subtract from the written terms, subject to the statutory exceptions. The Defendants' alleged oral understandings must therefore be tested against, and cannot displace, the contractual text.

The 1st Defendant sought to prove orally that the Plaintiffs agreed to a cash-only transaction and knowingly accepted the caveat. Yet the SPA contains no cash-only clause and no written acknowledgment of the private caveat. Where the written contract and the disputed recollections point in different directions, the formal agreement is the more reliable evidence of the legal bargain. The title and encumbrance provisions

Recital D and Clause 1 proceeded on the basis that the Property was sold free from encumbrances, subject to the encumbrances and title conditions disclosed in Part 2B. Part 2B identified the CIMB Bank charge, the express condition of S/N Yiyax0mwxUei0M/9MWvZA residential use and "NIL" under restriction in interest. It did not identify the private caveat.

The parties devoted substantial argument to whether the entry "Restriction in Interest: NIL" encompassed a caveat. The 1st Defendant was correct that a restriction in interest imposed by the State Authority and a private caveat are technically different land-law concepts. That distinction does not dispose of the claim. The contractual question is broader: whether the SPA disclosed the existing private caveat or otherwise recorded that the Purchasers accepted it. It did neither.

In Lee Chin Cheng Dengkil Oil Palm, the Court of Appeal held that the word "encumbrances", construed in the context of the National Land Code 1965, included a private caveat. It further held that if the parties intended a known caveat not to be treated as an encumbrance for the purposes of the agreement, they could have expressly said so in writing. That principle applies directly. The caveat here was not listed, excluded or accepted in any written variation.

Clause 12.1(e) must also be read in its proper context. Its exact wording was that, to the best of the Vendor's knowledge and belief, there was no prohibitory order against the Property or any proceedings filed or pending which would result in a prohibitory order or caveat of any kind being lodged against it. Standing alone, that sub-clause is framed in terms of prohibitory orders and proceedings capable of producing a caveat. Read S/N Yiyax0mwxUei0M/9MWvZA together with Recital D, Clause 1, Part 2B and the wider warranties, it formed part of a contractual assurance that no undisclosed title impediment of that nature affected the transaction.

Clause 12.3 is of particular importance. It expressly records that the Purchasers entered the SPA in reliance upon the declarations, representations, warranties and covenants in Clause 12, the recitals and elsewhere in the agreement, and that the Purchasers could treat them as conditions. This is not a case in which reliance must be inferred solely from oral evidence. The contract itself identifies reliance and the contractual significance of the warranties.

The private caveat had been lodged more than six months before the SPA. The 1st Defendant knew of it. It was not disclosed in Part 2B or elsewhere in the SPA. I therefore find that the SPA, construed as a whole, contained a materially inaccurate representation of the title position and that the 1st Defendant was in breach of his contractual obligations concerning the status of the Property. The legal effect of the caveat

The caveat was not a trivial administrative notation. In Woon Kim Poh v Sa’amah bte Hj Kasim [1987] 1 MLJ 400, the Supreme Court explained that a private caveat restrains S/N Yiyax0mwxUei0M/9MWvZA registered dealings while it remains in force. The effect of caveats in protecting claimed interests and inhibiting dealings was also recognised in Eng Mee Yong & Ors v V Letchumanan [1979] 2 MLJ 212 and T Damodaran v Choe Kuan Him [1979] 2 MLJ 267.

The Plaintiffs were purchasing a RM5.4 million bungalow and had paid RM1.55 million. An existing third-party caveat was plainly material to an informed decision whether to proceed, to the timing and security of payments, and to the structure of any financing. The fact that a caveat may later be removed does not make its existence immaterial when the contract is signed.

Loh Bee Tuan v Shing Yin Construction (Kota Kinabalu) Sdn Bhd & Ors [2002] 2 MLJ 532 concerned materially different and more extensive encumbrances, but it illustrates the obvious commercial importance of a representation that property is available for transfer free from undisclosed encumbrances. A reasonable purchaser is entitled to treat the true title position as material. Payment by cash and payment by loan

The 1st Defendant's cash-only submission cannot be reconciled with Clause 6A. Clause 6A.1 dealt with payment by cash. Clause 6A.2 was headed "Payment by Loan" and expressly contemplated an application for a loan or financing facility from S/N Yiyax0mwxUei0M/9MWvZA a bank or financial institution to assist the Purchasers in acquiring the Property, subject to the completion period or any extended period.

The sixteen-month completion period and instalment structure undoubtedly imposed a contractual timetable. They did not remove the alternative financing mechanism which the parties included in the same agreement. During cross-examination, the 1st Defendant accepted that Clause 6A.2 existed and that no clause used the expression "cash only".

The SPA must be read coherently. Clause 4 regulated when the balance was to be paid; Clause 6A regulated how it might be paid. The Plaintiffs were required to complete within the contractual period, but they were not prohibited from using financing. The Court therefore rejects the submission that their application for a bank loan was foreign to the original bargain.

I accept that the Plaintiffs did not prove, through a bank officer or formal rejection letter, that the caveat was the sole cause of the failure to obtain financing. I make no such finding. That evidential gap is relevant to the allegation about the bank's decision but is not fatal to the contractual claim. The breach was the undisclosed and inaccurately documented title position, not merely the later outcome of a particular loan application. S/N Yiyax0mwxUei0M/9MWvZA Clauses 14 and 16 and the later removal of the caveat

Clause 14.1 required the Vendor, at his own cost and expense, to procure the removal of all encumbrances and caveats over the Property, save those caused by the Purchasers, and authorised the Purchasers' solicitors to use the balance purchase price for that purpose. Clause 16.1 entitled the Purchasers to suspend the time for payment if, during the agreement, the Property was encumbered or subjected to a caveat other than one disclosed or caused by the Purchasers, until removal at the Vendor's cost.

Those provisions regulate the removal of encumbrances and protect the Purchasers while an undisclosed caveat remains. They do not authorise non-disclosure at the outset or render the title warranties meaningless. Indeed, Clause 16's express distinction between disclosed and undisclosed encumbrances reinforces the importance of disclosure.

The 1st Defendant's construction would permit a vendor to omit a known caveat from the SPA and later rely on a general removal mechanism as a complete answer. That would deprive the recitals, Clause 1, Part 2B and Clause 12 of substantive effect. The clauses must instead operate cumulatively: the Vendor was required to disclose the title position, warrant the matters stated, remove encumbrances and bear the consequences of a breach of warranty. S/N Yiyax0mwxUei0M/9MWvZA

The caveat was removed in February 2018. The later removal did not retrospectively make the SPA accurate when executed. Clause 12.2 prescribed the agreed mechanism for breach of warranty: rectification within fourteen days after notification, failing which termination and the Clause 8 remedies became available. The evidence did not establish that the Plaintiffs were transparently informed of the removal in a manner which restored the original bargain and enabled an informed resumption of performance.

The principle relied upon in Mintye Properties Sdn Bhd v Yayasan Melaka [2006] 6 MLJ 420 is instructive. A party cannot insist upon a materially altered contractual position which the agreement did not contain and compel the counterparty to treat it as the original bargain. Here the represented bargain was a purchase subject only to disclosed title matters. The Defendants could not substitute a different position - an undisclosed existing caveat to be regularised later and insist that it was legally equivalent. Prior knowledge and the alleged oral disclosure

The evidence about the early meetings was conflicting. The 1st Defendant and 2nd Defendant said the caveat was mentioned. The Plaintiffs denied receiving clear and informed disclosure before the SPA. The 1st Plaintiff's recollection had S/N Yiyax0mwxUei0M/9MWvZA imperfections, but the issue is not determined by credibility in isolation.

If the caveat had been knowingly accepted as part of the transaction, the professionally prepared SPA should have said so. The document disclosed the CIMB charge and contained detailed provisions concerning caveats, yet it omitted this particular caveat. Lee Chin Cheng Dengkil Oil Palm demonstrates why mere knowledge of a caveat does not establish an agreement to disregard it as an encumbrance. Such an exceptional bargain should be recorded in writing.

Applying Quality Concrete Holdings, the alleged oral disclosure cannot contradict the SPA or create an unwritten qualification to the title provisions. I therefore find that the Defendants failed to establish that the Plaintiffs contractually accepted Wan Qi Yi's caveat or waived the protection of the written agreement. Affirmation, waiver and termination

The Defendants relied on the Plaintiffs' attempts to obtain a revised SPA and their failure to issue an immediate termination notice. In Mintye Properties, the Court of Appeal explained that, absent an express election, affirmation or termination is assessed objectively from the surrounding circumstances. Mere inactivity after breach does not necessarily amount to S/N Yiyax0mwxUei0M/9MWvZA affirmation. Section 40 of the Contracts Act 1950 likewise recognises the innocent party's election where the other party refuses or disables himself from performing the promise in its entirety.

The Plaintiffs stopped making payments after December 2017, raised the caveat, requested a revised agreement and sought to restructure the transaction. Those actions were not consistent with unconditional performance of the original SPA. They were attempts to preserve the commercial objective on different and regularised terms. Parties do not necessarily surrender accrued rights merely because they first seek a commercial solution before litigating.

I therefore find no unequivocal affirmation or waiver. The later formal termination was the legal culmination of the position the Plaintiffs had taken after discovering the true title status. The 1st Defendant's separate submission that the SPA automatically terminated by effluxion of time was not properly pleaded as an independent defence. Mkini Dotcom Sdn Bhd & Ors v Raub Australian Gold Mining Sdn Bhd [2021] 5 MLJ 79 confirms that parties are bound by their pleadings and a case should not be decided on an unpleaded basis. In any event, effluxion of time would not erase the prior breach.

Theresa Toyat & Anor v KHL Sdn Bhd [2015] 5 MLJ 31 concerned a vendor's continuing failure to provide land free from encumbrances by completion. The facts are S/N Yiyax0mwxUei0M/9MWvZA distinguishable because the caveat here was later removed. Nevertheless, the Court of Appeal's reasoning supports the wider proposition that the obligation to deliver the contracted title free from encumbrances is material and continuing and that a vendor in prior breach cannot rely upon the purchaser's non-completion to retain the benefit of the bargain. Professional negligence of the 2nd and 3rd Defendants

The absence of a formal written retainer is not conclusive. The Court must examine what the solicitor actually undertook and whether the client reasonably relied upon him in a professional capacity. The 2nd Defendant negotiated terms, communicated that he had acted "for" the Plaintiffs, used the 3rd Defendant's letterhead, handled or transmitted substantial payments, participated in the SPA and remained involved when a revised agreement was sought.

That conduct went well beyond a social introduction. By the time the SPA was prepared and executed, the 2nd and 3rd Defendants were plainly acting for the Plaintiffs in the conveyancing transaction. They owed a duty to exercise the reasonable care and skill expected of solicitors dealing with a RM5.4 million purchase and RM1.55 million of client funds.

The duty included ascertaining or confirming the title position, advising clearly on any caveat, ensuring that the SPA S/N Yiyax0mwxUei0M/9MWvZA accurately reflected known title matters, and securing appropriate protection for the Plaintiffs' payments. The 2nd Defendant sought to answer the claim by saying that no specific instruction or payment for a land search had been given. That is inadequate. A conveyancing solicitor cannot permit a client to execute a substantial purchase agreement without reconciling its title warranties with the actual register.

If the 2nd Defendant knew of the caveat, his failure to record and explain it was negligent. If he did not know, his failure to ascertain it before execution was negligent. On either version, the Plaintiffs were allowed to proceed under an SPA which did not accurately or transparently record a material title impediment.

Kheng Chwee Lian v Wong Tak Thong requires proof of representation, reliance and inducement in misrepresentation. The Defendants invoked that principle, but it does not assist them. Clause 12.3 expressly records contractual reliance, and the professional participation of the solicitors reinforced the Plaintiffs' reasonable belief that the documented title position was reliable.

I find that the 2nd and 3rd Defendants breached their professional duty. Their negligence operated together with the 1st Defendant's contractual breach to expose the Plaintiffs' RM1.55 million to the same failed transaction and deprived them of informed choices: to decline the purchase, insist on S/N Yiyax0mwxUei0M/9MWvZA removal before execution, condition the SPA, secure the payments or expressly allocate the caveat risk. Causation, loss and joint liability

The fact that substantial payments preceded the SPA does not sever causation. The Plaintiffs' loss was not confined to the first decision to express interest or make the initial payment. They continued and formalised the transaction under the SPA, paid further monies and remained exposed without accurate contractual documentation or proper professional protection.

The sum of RM1,550,000.00 was proved by the payment records and was not seriously disputed. The Plaintiffs did not receive the Property. Upon rescission and termination, restitution of the purchase monies is the appropriate consequence against the 1st Defendant. The reasoning in Theresa Toyat supports the restoration of sums paid where the vendor failed to deliver the contracted property free from encumbrances.

The 2nd and 3rd Defendants' liability arises in negligence rather than under the SPA. Nevertheless, the contractual breach and professional negligence materially contributed to the same indivisible financial loss. The 1st Defendant received the benefit of the payments under an agreement liable to rescission; the solicitors deprived the Plaintiffs of the professional safeguards S/N Yiyax0mwxUei0M/9MWvZA which should have prevented or adequately conditioned that exposure.

Accordingly, the Defendants are jointly and severally liable for the judgment sum. The Plaintiffs are entitled to one recovery only. Payment by any Defendant will discharge the others to the corresponding extent. Questions of contribution or indemnity among the Defendants do not diminish the Plaintiffs' entitlement and are not necessary to determine in this judgment. The counterclaim

The 2nd and 3rd Defendants counterclaimed for professional fees. In light of the findings that the relevant conveyancing services were performed negligently and materially contributed to the Plaintiffs' loss, the counterclaim cannot succeed. The evidential basis and calculation of the claimed fees were also not established with sufficient clarity. The counterclaim is dismissed. Conclusion

The documentary evidence is decisive. The private caveat existed when the SPA was signed. The SPA disclosed the CIMB charge but not the private caveat. Read as a whole, its recitals, title provisions and warranties represented that the Property was sold free from undisclosed encumbrances. The S/N Yiyax0mwxUei0M/9MWvZA 1st Defendant knew of the caveat, yet it was neither identified nor accepted in writing.

Clause 6A contemplated both cash and loan financing; the agreement was not cash-only. Clauses 14 and 16 provided mechanisms to remove encumbrances and suspend payment but did not authorise non-disclosure or retrospectively validate the inaccurate contractual position. The later removal of the caveat did not erase the breach which existed at execution.

The Plaintiffs' attempts to negotiate a revised SPA did not amount to an unequivocal waiver or affirmation. The absence of conclusive banking evidence prevents a finding that the caveat was the sole reason financing failed, but does not defeat the claim based on the SPA and the professional negligence proved at trial.

The 2nd Defendant was not merely an introducer. The contemporaneous correspondence and his conduct established a solicitor-client relationship. The 2nd and 3rd Defendants failed to exercise reasonable care and skill in ascertaining, advising upon and documenting the title position. The Plaintiffs have therefore established their claim against all Defendants on the balance of probabilities. S/N Yiyax0mwxUei0M/9MWvZA Orders

Accordingly, the Court makes the following orders:

(a) The Plaintiffs’ claim is allowed.

(b) The Sale and Purchase Agreement dated 20 October 2017 is rescinded and terminated.

(c) The 1st, 2nd and 3rd Defendants shall jointly and severally pay to the Plaintiffs RM1,550,000.00, being the monies paid pursuant to the SPA.

(d) Interest at the rate of 5% per annum on RM1,550,000.00 shall run from the date of filing of this action until full realisation.

(e) The counterclaim of the 2nd and 3rd Defendants is dismissed.

(f) Costs of RM30,000.00 are awarded to the Plaintiffs against the Defendants.

(g) For avoidance of doubt, the Plaintiffs shall not recover more than the judgment sum, interest and costs notwithstanding the joint and several liability. S/N Yiyax0mwxUei0M/9MWvZA

These are the reasons for the decision of this Court. Dated this 15th day of July 2026 -sgd- ........................................ Asmah binti Musa Judicial Commissioner High Court of Malaya Shah Alam Counsel for the Plaintiff: Ms. Wan Azreen binti Wan Shaharuddin Messrs. Jahaberdeen & Co Counsel for the Defendants: Mr. Mahadzir bin Nasaruddin Messrs. Poh, Mahadzir & Co Mr. Norazam bin Sulaiman S/N Yiyax0mwxUei0M/9MWvZA