Teminsri Construction Sdn Bhd v Central Spectrum (M) Sdn Bhd (BA-24NCvC-510-03/2023)

In the ex parte Originating Summons filed herein, the Applicant applied for extension of 19 private caveats which it lodged onto 19 separate titles in respect of 19 parcels of land totalling about 147 acres at Pulau Indah in the District of Klang, Selangor until the further order of this Court or until final disposal of the Originating Summons. The registered proprietor of the said lands is Central Spectrum (M) Sdn Bhd.

This Court directed the ex parte Originating Summons to be served on the registered proprietor, and Central Spectrum (M) Sdn Bhd was thereby cited as the Respondent.

When the Originating Summons came up for hearing on 29.3.2023 in response to a Certificate of Urgency, this Court granted an ad interim extension of the 19 private caveats on terms that the Applicant shall provide security for damages in the amount of RM1,000,000 in 2 equal tranches (the first tranche to be paid within 2 weeks and the second tranche within 4 weeks) to be held by joint 3 stakeholders comprising the parties’ solicitors and that in the event of the failure to provide the said security for damages, the ad interim extension order shall lapse automatically.

The ad interim extension order lapsed on 12.4.2023 due to the Applicant’s failure to comply with the condition as to payment of the first tranche of the security for damages.

When the Registrar of Titles refused to cancel the private caveats unless a specific court order on such cancellation is granted and the Respondent refused to send a notice to the Registrar regarding the lapse of the ad interim extension order, the Respondent by Enclosure 13 filed on 26.4.2023 applied to this Court for an order directing the Applicant to send a written notice to the Registrar of Titles regarding the automatic lapse of the ad interim extension order and to provide documentary proof of the cancellation of the 19 private caveats and other ancillary orders.

In the face of the Respondent’s application in Enclosure 13, the Applicant did not ask for extension of time for compliance with the term as to the payment of security for damages and also did not appeal against the conditional ad interim extension order dated 29.3.2023.

After the filing and exchange of affidavits and written submissions in respect of the Respondent’s Enclosure 23 application, this Court on 25.7.2023 made an order that (1) declaring that the ad interim extension order dated 29.3.2023 expired and was cancelled on 12.4.2023 as a result of automatic lapse thereof; (2) directing the Applicant to send a written notice to the Registrar of Titles regarding the automatic lapse of the ad interim extension order ; (3) directing the Applicant to provide documentary proof of the cancellation of the 19 private caveats; (4) ordering the Applicant to pay costs of RM40,000 to the Respondent; (5) declaring that in principle the Respondent is entitled to claim damages, if any, caused by the lodgement of 19 private caveats and the ad interim extension of the said caveats; and (6) for the purposes of item (5), liberty was given to the Respondent to file a separate suit to claim for damages, if any, caused by the lodgement of 19 private caveats and the ad interim extension of the said caveats. 4

Dissatisfied with the decision dated 25.7.2023, the Respondent has filed an appeal to the Court of Appeal vide Notice of Appeal dated 11.8.2023 in Enclosure 42.

As there is no appeal against this Court’s decision dated 29.3.2023 (grant of conditional ad interim order), this Court’s Grounds of Judgment here will only deal with the decision dated 25.7.2023 and the reasons for the decision dated 25.7.2023. The terms of the ad interim order dated 29.3.2023 and the consequences arising therefrom are included here as introductory or background facts to facilitate a better understanding of the decision dated 25.7.2023.

The terms of the ad interim order dated 29.3.2023 in English are as follows:

the Court granted an ad interim extension of the 19 private caveats which were lodged by the Applicant on the Respondent’s 19 parcels of land until the full and final disposal of this suit in the High Court with terms stated in paragraphs

and (c) below;

The ad interim extension under paragraph (a) above is subject to the condition that the Applicant shall deposit RM1,000,000.00 as security for damages, for the event if the ad interim is found to be unjustifiable at the decision after the hearing of the main suit, into a joint stakeholder account to be held by the parties’ solicitors in two tranches:

the first tranche of RM500,000.00 shall be paid within 2 weeks from the date of ad interim order, i.e. on or before 12.4.2023; and

(ii) the second tranche of RM500,000.00 shall be paid within 4 weeks from the date of ad interim order, i.e. on or before 26.4.2023;

If the Applicant fails to pay the security for damages of RM1,000,000.00 or part thereof as stated in paragraphs (b),

(b)(i) and (b)(ii) above, the ad interim extension under paragraph (a) shall lapse automatically; and 5

Costs in the cause. Events subsequent to the grant of conditional ad interim extension dated 29.3.2023 [11] Subsequent to the grant of the conditional ad interim order, the Applicant failed to pay the first tranche of RM500,000.00 within 2 weeks from the date of ad interim order, i.e. on or before 12.4.2023. This fact is averred to in paragraph 8 of the Respondent’s Affidavit-in-Support (Enclosure 14). [12] In paragraph 7.2 of the Affidavit-in-Reply (Enclosure 15), the Applicant confirmed that it did not pay the first tranche of RM500,000.00 on or before 12.4.2023, though the Applicant tried to excuse itself by alleging that it did not have enough time to arrange the funding for it. [13] Even up to the due date of 26.4.2023 for payment of the second tranche of RM500,000 there was no payment whatsoever which has been made by the Applicant towards the security for damages. [14] Until the date of this Court’s decision of 25.7.2023, there was no application by the Applicant for extension of time to raise the fund for the security for damages. Moreover, there was no evidence of any imminent prospect of the Applicant’s ability or willingness to pay the security for damages. [15] Instead, by the Applicant’s solicitor’s letter dated 19.4.2023 in paragraphs 4 and 5 thereof and in Exhibit “WS-16” to the Applicant’s Affidavit-in-Reply (Enclosure 15) stated the Applicant’s position as follows: “4. As such, our client instructed us that it decided not to provide the deposit of the said Security Sum and resulting thereto, the Ad Interim Extension of the subject Private Caveats is lapsed pursuant to paragraph (c) of the said Order. Given the circumstances, there is no purpose for the Applicant to proceed with this Originating Summons. 6

We have been instructed by our client to propose to withdraw this Originating Summons by way of filing of a Notice of Discontinuance and with no order as to costs”. [16] According to the Respondent’s solicitor, the Applicant’s solicitor’s letter dated 19.4.2023 was only received by the Respondent’s solicitor on 28.4.2023. See Exhibit “WS-17” to the Applicant’s Affidavit-in-Reply (Enclosure 15). [17] By letter dated 20.4.2023, the Respondent’s solicitors wrote to the Applicant’s solicitors which, among others, notified the Applicant of the lapse of the ad interim extension order due to the Applicant’s failure to provide the first tranche of security for damages, asked the Applicant to write to the Registrar of Titles to strike off or remove the 19 private caveats, etc: see Exhibit “MR-13” to the Respondent’s Affidavit-in-Support (Enclosure 14). [18] There was no reply nor action on the part of the Applicant regarding the giving of notice to the Registrar of Titles. [19] Meanwhile, on 26.4.2023 the Respondent filed its application in Enclosure 13 for the consequential orders, the subject-matter of this appeal. Respondent’s application in Enclosure 13 [20] In Enclosure 13 application, the Applicant applied for the following orders: i. Plaintif diperintahkan untuk memberi notis dengan serta-merta kepada Pendaftar Tanah dan Galian Selangor tentang peluputan secara automatik Perintah Ad Interim pelanjutan 19 kaveat Plaintif dalam 19 Hakmilik-Hakmilik Individu Responden dan mengambil langkah pembatalan kesemua 19 kaveat itu, dengan kos ditanggung oleh Plaintif dan Plaintif diperintahkan menyampaikan kepada Responden bukti carian rasmi atas 19 Hakmilik-Hakmilik Individu Responden bahawa kesemua 19 kaveat Plaintif itu telah dibatalkan; ii. Plaintif diperintah membayar kos serta-merta kepada Responden bagi pendengaran Perintah Ad Interim bertarikh 29.03.2023 sebanyak RM30,000.00 atau sebagaimana ditetapkan oleh Mahkamah Yang Mulia ini; dan 7 iii. Plaintif diperintahkan membayar kepada Responden serta-merta ganti rugi punitif dan/atau ganti rugi teladan dan/atau ganti rugi teruk sebanyak RM750,000.00 kerana memperolehi Perintah Ad Interim bertarikh 29.03.2023 dan untuk 3 minggu penikmatan oleh Plaintif akan lanjutan 19 kaveat dalam 19 Hakmilik-Hakmilik Individu Responden secara tidak adil dan secara tidak layak dari 30.03.2023 hingga 19.04.2023 dan/atau masih berterusan atau kuantum lain yang wajar sebagaimana ditetapkan oleh Mahkamah Yang Mulia ini; dan iv. Plaintif diperintahkan membayar kos serta-merta kepada Responden bagi Saman Pemula ini sebanyak RM55,000.00 atau sebagaimana ditetapkan oleh Mahkamah Yang Mulia ini lanjutan keputusan Plaintif untuk tidak meneruskan tindakan Saman Pemula ini selepas Responden telah memfailkan Afidavit Jawapan Responden pada 10.04.2023; v. Kos bagi permohonan ini; dan vi. Perintah lain atau relif selanjutnya yang Mahkamah Mulia ini anggap wajar dan suaimanfaat. [21] In paragraph 36 of the Applicant’s Written Submission (Enclosure 23), the Applicant argued that “Prayer 1 of the Respondent’s Notice of Application (pp 3, Encl. 13) is redundant as the Applicant’s solicitors had on 08.05.2023 notified the Registrar of the Selangor Land and Mines Office that the said Ad Interim Extension of the said 19 Private Caveats had lapsed automatically pursuant to paragraph

of the Ad Interim Order. The said Registrar was also asked to make necessary endorsement on the register document of title of the said 19 Individual Titles to reflect the same (pp 213-234, Encl. 15). At all material times, the Respondent is at liberty to conduct a necessary search on the said 19 Individual Titles if it wishes to do so. In reply thereto, the Respondent submitted that prayer 1 is still relevant as the 19 private caveats are still on the titles and there is no evidence of cancellation or removal of the caveats [see paragraphs 2 and 30 of the Respondent’s Submission-in-Reply (Enclosure 31)]”. [22] In respect of prayers 2 and/or 4 of Enclosure 13, the Applicant vide paragraph 37 of its Written Submissions (Enclosure 23) argued that 8 these costs should not be allowed or alternatively the Respondent should only be granted nominal costs for the Originating Summons. [23] As regards prayer 5, the Applicant argued that there was no factual and/or legal basis for the Respondent to claim for punitive, exemplary and/or aggravated damages. The Applicant cited the cases of Laksa Laksamana Realty Sdn Bhd v. Goh Eng Hwa [2005] 4 CLJ 871 at pages 881 – 883; Sambaga Bailli KR Ponnusamy v. Datuk Bandar Kuala Lumpur [2017] 1 LNS 500 (Court of Appeal); Muhammad Zulkanain v. Pengarah Hospital Sutan Ismail Johor Bahru [2021] 8 MLJ 762; Hasniyati Hassan v. Kerajaan Malaysia [2022] 7 CLJ 565. Findings and conclusion of this Court [24] In the considered opinion of this Court, prayer 1 is still not redundant yet because:

there is still no evidence of cancellation or removal of the private caveats until the date of hearing of Enclosure 13;

the Registrar of Titles may probably not act on the automatic lapse of the ad interim extension in the absence of an express written confirmation by the caveator or another order of the Court to specifically clarify on the same; and

the letter dated 3.5.2023 was only written by the Applicant after the Enclosure 13 application has been filed. [25] A Registrar of Titles when faced with a conditional order on extension of caveator may not want to act on the mere wording of the conditional order to cancel or remove the private caveats because he/she is not in a position to know whether or not the condition has been fulfilled or whether or not the time for compliance with the condition has been extended. In such situations, it is better and still relevant that a consequential order of the Court be issued to confirm in writing that the previous conditional order has lapsed and ceased to have any effect so that the Registrar of Titles can forthwith take steps to cancel or remove the caveats in implementation of the clear terms of the court order. 9 [26] In the circumstances, this Court held that the order as per prayer 1 be issued here. [27] As regards costs in prayers 2 and 4, this Court does not accept the Applicant’s argument on nominal costs. In the present case, the Respondent has attended the inter partes hearing on 29.3.2023 which led to the issuance of the ad interim extension order, filed and served affidavit-in-reply to Enclosure 1 (see Enclosure 10), filed and served the application in Enclosure 13, filed and served affidavits in respect of Enclosure 13 (see Enclosures 14 and 18), filed and served affidavit in Enclosure 21, filed and served written submission and authorities (Enclosures 26 to 29), and filed and served written submission-in-reply (Enclosure 31). [28] The gross development value of the project proposed for the subject lands of about 147 acres was supposed to be about RM460 million. The large value of the subject matter and its importance to the Respondent are relevant factors for assessing the amount of costs of action. [29] In the circumstances, this Court assessed the costs of the entire proceedings in this suit at RM40,000 subject to allocator and awarded the same as costs to the Respondent. [30] As regards damages for wrongful caveats, the arguments are to be presented by the parties for the Court’s decision during the assessment of damages. This Court at this stage cannot summarily assess the alleged damages, and such damages, if any, have to be assessed in the usual way. [31] Taking into consideration the fact that this suit is filed by Originating Summons and that an Originating Summons should, as a general rule, be disposed of within a few months from the date of its filing, this Court finds it more appropriate that the assessment of damages is to be dealt with by way of a separate action. As such, liberty is given to the Respondent to file a separate action for damages caused by the wrongful entry and/or continuation of caveats. Conclusion [32] In conclusion, this Court on 25.7.2023 allowed the Respondent’s application in Enclosure 13 on modified terms as follows: 10

Perintah deklarasi dan klarifikasi bahawa Perintah Ad Interim bertarikh 29 Mac 2023 dalam guaman ini telah luput dan dibatalkan pada 12 April 2023 akibat peluputan otomatik;

Plaintif diperintahkan untuk memberi notis bertulis dengan serta-merta kepada Pendaftar Tanah dan Galian tentang peluputan Perintah Ad Interim bertarikh 29 Mac 2023 tersebut dan memberitahu Pendatar tersebut untuk mengambil tindakan pembatalan kesemua 19 kaveat Plaintif dalam Hakmilik-Hakmilik Individu Responden dengan kos ditanggung oleh Plaintif;

Plaintif hendaklah menyampaikan kepada Responden bukti carian rasmi atas 19 Hakmilik-Hakmilik Individu Responden bahawa kesemua 19 kaveat itu telah dibatalkan;

Plaintif hendaklah membayar kos guaman ini dan kos permohonan ini sejumlah campur RM40,000 kepada Responden, tertakluk kepada alocatur;

Perintah deklarasi bahawa secara prinsip, Responden berhak menuntut terhadap Plaintif untuk gantirugi-gantirugi, jika ada, yang disebabkan oleh 19 kaveat-kaveat tersebut dan lanjutan ad interim kaveat-kaveat tersebut; dan

Untuk maksud dan tujuan perintah (5) di atas, kebebasan diberi kepada Responden untuk memfailkan guaman yang berasingan untuk menuntut gantirugi-gantirugi, jika ada, yang disebabkan oleh 19 kaveat-kaveat tersebut dan lanjutan ad interim kaveat-kaveat tersebut. Dated this : 23rd August 2023 Signed ..……................................................................. TEE GEOK HOCK JUDGE HIGH COURT OF MALAYA AT SHAH ALAM (NCvC 10) 11 To the parties’ solicitors:

For the Plaintiffs : Soh Jing Hian Lee Kuan Wing Messrs HL Wong, Soh & Co (Kuala Lumpur)

For the Defendant : Murad Ali bin Abdullah Messrs K’MURA & Co. (Klang)