Kos permohonan yang ditaksirkan hendaklah dibayar oleh Pemohon kepada Pencelah Yang Dicadangkan; Page 4 of 15 Applicant’s Contention [11] The Applicant contended that neither the High Court nor the Court of Appeal made any finding that the Registrar’s Caveat was wrongfully or unreasonably entered, nor that it was lodged mala fide or without reasonable cause. [12] The Applicant also contended that the absence of any judicial finding that the Registrar’s Caveat was wrongfully entered is fatal to the Intervener’s claim for damages. Wrongful entry is a necessary condition precedent to any compensation being awarded, and such a finding was never made. The Applicant further contended that the Registrar’s Caveat was entered pursuant to a court order and not through any unilateral or improper act on the part of the Applicant. [13] The Applicant further contended that there is no statutory basis under the National Land Code, particularly Section 329, for the award of compensation arising from the entry or removal of a Registrar’s Caveat. [14] The Applicant asserted that while the National Land Code provides an express compensation regime in respect of private caveats, there is no equivalent provision permitting damages for Registrar’s Caveats. Accordingly, the Applicant contended that any order directing payment of damages in respect of a Registrar’s Caveat must be strictly confined and cannot be assumed or treated as automatic upon the setting aside of the Caveat. [15] The Applicant contended that the High Court Order dated 29.09.2011 directed only that damages, if any, suffered by the Intervener be assessed, and that such assessment must necessarily be confined to Page 5 of 15 actual and real losses directly attributable to the existence of the Registrar’s Caveat. The Applicant maintained that the Deputy Registrar acted without jurisdiction in assessing damages beyond 29.09.2011. The Applicant asserted that the Court of Appeal’s affirmation of the High Court decision did not extend or enlarge the period for the assessment of damages and referred to the Court of Appeal case of Tan Goat Eng & Anor v. Rozdenil Toni [As Administrator of Estate of Toni Ismail & Normy Mohamad Khatif; Deceased] [2015] 6 CLJ 486. [16] The Applicant maintained that the date of assessment of damages must be between 10.3.2011 and 29.9.2011, being the date of entry and removal of the Registrar’s Caveat based on the High Court Order dated 29.9.2011. [17] Further, the Applicant contended that the DR has erred in law when granting interest at the rate of 5% per annum from 29.09.2011 to the date of realization. The Order dated 29.9.2011 does not provide for an award of interest over the assessed damages, and the DR was bound by the Order. [18] The Applicant further contended that the Intervener failed to establish any causal nexus between the Registrar’s Caveat and the alleged losses claimed. In particular, the Applicant disputed the claim for loan interest incurred by the Intervener, asserting that the obligation to service a bank loan and to pay interest arose from the Intervener’s own commercial decision to finance the purchase of the said lands through borrowing. The Applicant contended that no evidence was adduced to show that any restructuring, extension, or additional interest imposed by the bank was caused by the existence of the Registrar’s Caveat, and that Page 6 of 15 the evidence relied upon by the Intervener in this regard was speculative and unsupported by contemporaneous documents. [19] The Applicant also disputed the Intervener’s claim for loss of profit allegedly arising from a proposed leasing arrangement with Tesco Stores (Malaysia) Sdn. Bhd. The Applicant contended that the alleged loss of profit is speculative, remote, and unsupported by admissible evidence. The Applicant asserted that the letter relied upon by the Intervener was a disputed document where authenticity and contents were challenged, that the maker of the document was never called to testify, and that the document was conditional in nature, subject to board approval, and did not constitute a concluded or binding agreement. [20] Further, the Applicant contended that the DR erred in admitting and relying upon the said letter in assessing damages, notwithstanding the Applicant’s objections as to its admissibility and evidential weight. According to the Applicant, the reliance placed upon the document resulted in an erroneous assessment founded on an unproven and hypothetical loss of opportunity rather than an actual loss. [21] The Applicant submitted that the nexus between the loan restructuring and caveat was never established for the following reasons-i. No contemporary documents or letter from Maybank was ever produced before the Court ii. No witness from Maybank has been called to establish that the loan restructuring was given due to the existence of the caveat Page 7 of 15 iii. No evidence was submitted to show that the land cannot be developed due to the existence of the Caveat. [22] The Applicant further submitted that the existence of the Caveat of the title, whether Private or Registrar Caveat, does not in any way restrict the owner of the land from developing, leasing or performing other economic activities that can bring profit to the land owner. [23] The Applicant also contended that the Intervener failed to mitigate its alleged losses. A Registrar’s Caveat does not prohibit development, leasing, or interim use of land, save only for dealings requiring registration. However, the Intervener failed to take reasonable steps to utilise the Lands for alternative revenue-generating purposes, failed to pursue planning applications, and failed to explore lawful interim uses of the land, thereby contributing to its own losses. [24] Finally, the Applicant contended that the damages claimed and awarded, in substance, amount to unjust enrichment and punitive compensation. The Applicant asserts that the Intervener is effectively seeking to shift the burden of its commercial financing costs and unrealised business expectations onto the Applicant, which was never contemplated by the High Court Order dated 29.09.2011. Intervener’s Contention [25] The Intervener contended that it is the registered proprietor of the subject lands, having purchased the same pursuant to a Sale and Purchase Agreement dated 08.03.2010 for valuable consideration. The Intervener asserted that upon completion of the purchase, it acquired an Page 8 of 15 indefeasible title to the said lands and was entitled to the full enjoyment, use, and development thereof. [26] The Intervener contended that the Applicant caused a Registrar’s Caveat to be entered over the Lands pursuant to a Consent Order dated 08.03.2011 obtained between the Applicant and the Registrar of Land Titles, Pulau Pinang, without notice to or participation by the Intervener as the registered owner of the Lands. The Intervener asserted that the entry of the Registrar’s Caveat had the effect of depriving it of its proprietary rights and its ability to deal with, enjoy, and develop the Lands. [27] The Intervener contended that upon becoming aware of the Registrar’s Caveat, it immediately took steps to protect its interests by applying to intervene in the proceedings and to set aside the Consent Order. On 29.09.2011, the High Court Order allowed the Intervener’s application, set aside the Consent Order, ordered the removal of the Registrar’s Caveat, and further ordered that the damages suffered by the Intervener be assessed and paid by the Applicant. The Intervener contended that the said order was subsequently affirmed by the Court of Appeal on 10.04.2015 and was never set aside. [28] It is the submission of the Intervener that the Applicant has highly misconceived to contend that the DR has no powers or jurisdiction to award interest and should not, on her own, grant an award of interest since the learned Judge had exercised his discretion in not awarding interest over the assessed damages. The Intervener contended that the authority to assess the damages lies with the High Court Order. Hence, it is the discretion and power of the DR to award any damages following the Page 9 of 15 assessment proceeding, with interest thereon, as provided under Section 11 of the Civil Law Act 1956 and Order 42, Rule 12, Rules of Court 2012. [29] The Intervener submitted that the Registrar’s Caveat remained from 10.03.2011 until 10.04.2015, when the Court of Appeal dismissed the appeal and affirmed the High Court Order, and that throughout this period the Intervener was unable to deal with or develop the Lands. [30] Further, the Intervener contended that the existence of the Registrar’s Caveat effectively paralysed its development plans and prevented it from submitting development proposals, obtaining regulatory approvals, or utilising the land for its intended commercial purposes. [31] The Intervener also contended that it had purchased the Lands with the intention of developing them, not leaving them idle. In order to finance the purchase, the Intervener obtained a term loan of RM26.6 million from Maybank and asserted that during the period in which the Registrar’s Caveat subsisted, it was compelled to service the loan and absorb substantial interest costs without any corresponding income being generated from the land. [32] The Intervener further contended that during the subsistence of the Registrar’s Caveat, it received a letter of offer dated 10.09.2012 from Tesco Stores (Malaysia) Sdn. Bhd. expressing interest in leasing part of the Lands for the development of a hypermarket. The Intervener asserted that it accepted the said offer and that the proposed lease would have generated substantial rental income, which could have been used to service the loan and offset financing costs. However, the existence of the Registrar’s Caveat had prevented the submission of development plans Page 10 of 15 and the commencement of construction, thereby frustrating the proposed lease arrangement. [33] Further, the Intervener contended that as a result of the Registrar’s Caveat, it suffered two categories of losses. First, it incurred financing costs in the form of interest paid on the bank loan taken to acquire the Lands during the period when the Lands could not be developed or utilised. Second, it suffered a loss of profit arising from the inability to proceed with the proposed lease arrangement with Tesco, resulting in the loss of anticipated rental income. [34] The Intervener is of the position that it has adduced evidence through its witnesses to demonstrate that the losses claimed were actual and real losses directly attributable to the existence of the Registrar’s Caveat. Further, the damages claimed were compensatory in nature and intended to place it in the position it would have been in had the Registrar’s Caveat not been entered. [35] The Intervener further contended that it has taken reasonable steps to mitigate its losses but was unable to do so due to regulatory and practical constraints arising from the existence of the Registrar’s Caveat. The Intervener asserted that planning approvals would not have been granted while the Caveat subsisted and that interim uses of the land were not feasible without the requisite consents and approvals. [36] The Intervener contended that the DR correctly allowed the claim for loss of profit in the sum of RM391,772.38, but erred in disallowing the claim for financing costs amounting to RM6,190,634.83. The Intervener asserts that both heads of loss arose directly from the wrongful entry and Page 11 of 15 continued existence of the Registrar’s Caveat and that the Applicant ought to compensate the Intervener for the full extent of the losses suffered. Decision of the Deputy Registrar [37] The DR in her reasons stated as this- “For the sum of RM6,190,634.83 being the loan interest incurred on the land The applicant submitted that it is the obligation of the Intervener to pay its own loan (including interest) made to Maybank for the purchase of the said land in an auction. The intervener seeking order for the applicant to finance or subsidies the interest would amount to undue (unjust) enrichment on the part of intervener and amount to punitive damages which is against the order dated 29.11.2011. Whether the Registrar’s caveat exist or not, the intervener has to pay interest and/or furnish the loan facilities. The existence of the caveat (Private or Registrar’s caveat) does not in any way restrict the owner of the land for developing, leasing, or performing other economic activities that can bring profit to the owner… … Agreeing with the applicant, this court finds that the intervener is not entitled to the sum of RM6, 190, 634.83, being the loan interest incurred on the land.”. Page 12 of 15 ANALYSIS AND FINDINGS [38] Upon perusal of the reasons given by the DR and submission by both learned counsels of the Applicant and Intervener, this Court finds that there is no merit to allow the Intervener’s appeal and thus dismissed it with costs. This Court is of the considered view that there is no error of law and fact in the decision of the DR. [39] Regarding the Applicant’s appeal, this Court allowed it in part. The damages is calculated from 10.03.2011 until 29.09.2011. The appeal on interest is dismissed. The 5% interest by the DR is retained. [40] During the hearing of this appeal, both parties raised the issue on the interest. On the point, this Court refers to Section 11 of the Civil Law Act 1956 and Order 42 Rule 12 of the Rules of Court, which provide-i)