Wan Ahmad Azlan bin Wan Majid v Chew Yuan Heng (B-02(NCvC)(W)-790-04/2018)

CHEW YUAN HENG 30 (No. K/P Singapura : S0747689B)

KASTRIA SDN BHD … RESPONDEN- (Dalam Likuidasi) RESPONDEN 35 [Dalam Mahkamah Tinggi Malaya Di Shah Alam (Bahagian Sivil) Guaman No: 22NCVC-257-05/2015 Antara 40 Chew Yuan Heng (No. K/P Singapura : S0747689B) … Plaintif Dan 45 2 5 1. Kastria Sdn Bhd (Dalam Likuidasi)

Wan Ahmad Azlan Bin Wan Majid (No. K/P: 610704-03-5243) dan 10 Nazirah Binti Ismail (No. K/P: 390608-03-5284) [Sebagai Pentadbir-Pentadbir estet … Defendan-Wan Majid bin Wan Hamid, Si Mati] Defendan] 15 KORUM ZALEHA YUSOF, HMR YAACOB MD SAM, HMR LAU BEE LAN, HMR 20 GROUNDS OF DECISION Introduction [1] This is an appeal by the Appellant/2nd Defendant against the 25 decision of the learned High Court Judge (‘the trial Judge’) made on 20/3/2018 allowing the 1st Respondent/Plaintiff’s claim and dismissing the Appellant/2nd Defendant’s Counterclaim with costs of RM10,000.00. We shall for purposes of this appeal refer to the parties as they were referred to in the High Court. 30 [2] Having considered the Submissions of the respective Counsel and having perused the Records of Appeal before us, we unanimously allowed the appeal. We now set out the reasons for our decision. 35 3 5 Background [3] The Agreed Facts are as follows: (i) Plaintiff, Chew Yuan Heng is a Singaporean citizen; (ii) 1st Defendant, Kastria Sdn Bhd had been wound up by the Shah Alam High Court on 26/8/1993 and the Official Receiver is its liquidator; (iii) 2nd Defendant, Wan Ahmad Azlan bin Wan 10 Majid and Nazirah binti Ismail respectively, are the lawful son and lawful widow of Wan Majid bin Wan Hamid (‘Wan Majid’) are the administrators of the estate of Wan Majid; (iv) Lot 14130, PM 962, Negeri Selangor, Daerah Petaling, Mukim Damansara (‘the said Property’) is currently registered in the name of the 1st Defendant. 15 Plaintiff’s case [4] The Plaintiff’s case can be summarised as follows:

(a) Sometime in 1991, the 1st Defendant had sold all assets and 20 liabilities to Maple Resources Sdn. Bhd. (‘Maple Resources’) including a number of properties consisting of link houses and bungalow lots located in Kelana Jaya.

(b) At the material time, the Plaintiff was a director and shareholder of 25 Maple Resources and he had advanced money to the latter.

(c) Maple Resources then repaid the Plaintiff’s monetary advance by giving him the said Property. 30

(d) By reason of the aforesaid, the Plaintiff claims he is the beneficial owner of the said Property and the 1st Defendant (Kastria Sdn Bhd) is a bare trustee of the said Property for his benefit. 4 5

(e) The Plaintiff sought a declaration that he is the legal and beneficial owner of the said Property, an order that the Official Receiver take the necessary steps to transfer the said Property to him and that the Land Office register him as the legal owner of the same. 10 2nd Defendant’s Defence and Counterclaim [5] The 2nd Defendant’s Defence and Counterclaim can be summarised as follows: 15

(a) The 2nd Defendant’s case is that the said Property was purchased by the late Wan Majid from the 1st Defendant.

(b) In the course of administering the estate of Wan Majid, the 2nd Defendant found a copy of a letter dated 6/6/2001 from the Official 20 Receiver Malaysia (‘OR’) (at RR (Rekod Rayuan) Jld 2(2)/225) by which letter, the OR as liquidator of the 1st Defendant, had executed a memorandum of transfer (Borang Pindahmilik 14A) and the stamp duty form (PDS 15) in favour of Wan Majid and forwarded the same to Wan Majid.

(c) The memorandum of transfer, duly executed by the OR and by Wan Majid is found at RR Jld 2(2)/262-265 whereas the stamp duty form duly executed by the OR in favour of Wan Majid appears at RR Jld 2(2)/266-267. 30 5

(d) In the memorandum of transfer, the OR has acknowledged receipt 5 of a sum of RM150,000.00 from Wan Majid as consideration for the transfer of the said Property to him.

(e) The memorandum of transfer however, was not presented by Wan Majid during his lifetime. Despite best efforts and inquiries, the 2nd 10 Defendant could not locate the original memorandum of transfer. As such, the said Property still remains registered in the name of the 1st Defendant.

(f) By reason of the aforesaid, Wan Majid is a purchaser and the 15 beneficial owner of the said Property.

(g) The 2nd Defendant denies the Plaintiff’s claim and in particular states - 20

(i) the Plaintiff has no claim to or interest in the said Property;

(v) the Plaintiff’s claim (if any) is time barred under s.9 of the Limitation Act 1953 and/or he is guilty of laches. 6

(h) By reason of the beneficial interest of Wan Majid as aforesaid, the 5 2nd Defendant sought by way of Counterclaim a declaration that the estate of Wan Majid is the lawful and beneficial owner of the said Property and the 2nd Defendant is entitled to be registered as the proprietors of the said Property. 10 Primary issue to be tried [6] The main issue is whether the Plaintiff or Wan Majid (represented herein by the administrators as the 2nd Defendant) is the beneficial owner of the said Property. 15 Proceedings at High Court [7] There were 2 trials at the High Court. At the 1st trial on 22/9/2016, the 1st Defendant did not call any witness. The OR as liquidator of the 1st Defendant left it to the High Court to determine and declare whether the 1st Defendant or Wan Majid is the lawful and beneficial owner of the said 20 Property. [7.1] In his 1st decision on 27/10/2016 the learned trial Judge dismissed the Plaintiff’s claim and allowed the 2nd Defendant’s Counterclaim by declaring Wan Majid as the beneficial owner of the said 25 Property. [7.2] The Plaintiff appealed against the 1st decision. On 18/9/2017, the Court of Appeal allowed the Plaintiff’s appeal, set aside the 1st decision and ordered the matter be remitted to the trial Judge for a re-hearing on 30 the following terms: “1) the pleading and evidential records to be preserved; 7 2) liberty on both parties to subpoena official receiver (or) who ought to 5 have relevant evidence necessary to determine the claim and counter claim; 3) liberty granted to recall witnesses.” (‘Court of Appeal Order’) 10 [7.3] At the 2nd trial on 21/11/2017 -

(a) SP1 and SP2 were recalled for the Plaintiff’s case;

(b) the OR (as liquidator for the 1st Defendant) filed its bundle of 15 documents consisting of the documents in its possession;

(c) the OR called 2 witnesses: Pn. Ita Idzwati Binti Ibrahim (DW1) a Senior Insolvency Officer and Hj. Omar Bin Othman (DW2), Managing Director and contributory of 1st Defendant from the time 1st Defendant 20 was incorporated up to the time it was wound up in 1993. He was subpoenaed by the OR to appear as a witness and he testified as the managing director he was in charge of the day to day running of the 1st Defendant; and 25

(d) the position of the OR (as the liquidator for 1st Defendant) was that based on the documents and the law, Wan Majid is the purchaser of the said Property and that is why the valid and duly signed memorandum of transfer had been given to him by the OR. 30 [7.4] The appeal before this Court is against the 2nd decision of the learned trial Judge of 20/3/2018 referred in para 1 above. 8 Trial Judge’s Decision 5 [8] Essentially the trial Judge held that the Plaintiff’s claim was proved on these grounds -

(a) There is evidence that Plaintiff has advanced money to Maple Resources: from the Plaintiff (PW2) and Plaintiff’s witness, Tee Ching 10 Huat (PW1), both directors of Maple Resources in order to purchase a number of properties of the 1st Defendant. The transaction was captured in a Sale and Purchase Agreement dated 1/10/1991. As directors of Maple Resources they had the right to contra or set-off the money advanced to Maple Resources against one of the properties in the sale 15 and purchase agreement.

(b) Tee Ching Huat stated he had contra his advance by accepting a terrace house and the house was successfully transferred to him whilst the Plaintiff opted to contra his advance to Maple Resources for the said 20 Property which is listed in the sale and purchase agreement.

(c) The 2nd Defendant or the OR (as liquidator of the 1st Defendant) through their witnesses failed to produce conclusive evidence to show Wan Majid had made full payment for the purchase price of the said 25 Property.

(d) The evidence of the Defendants only showed Wan Majid has paid 10% of the purchase price which was for a different lot. As the sale did not materialised, the 1st Defendant agreed to pay compensation of 30 RM150,000.00 to Wan Majid or the said Property be transferred to Wan Majid. 9

(e) There is evidence that the said Property was allocated to the 5 Plaintiff: (i) Plaintiff entered into negotiation with 2 co-purchasers, Puan Rafiah binti Kassim and Encik Abdul Rahim bin Mohd Hasim sometime in October 1993 and the agreement dated 16/10/1995 between Plaintiff and said co-purchasers was not challenged; (ii) Plaintiff received notice of assessment from the local authority and made the payment in full; and 10

(f) The Plaintiff has acquired beneficial ownership of the said Property and the 1st Defendant held the said Property as a bare trustee for him 15 citing Tan Ong Ban v. Teoh Kim Heng [2016] 3 CLJ 193.

(g) The mere fact of non-registration of a title in the Plaintiff’s name does not affect the Plaintiff’s beneficial or equitable rights citing Karuppiah Chettiar v. Subramaniam [1971] 1 LNS 43.

(h) The 1st Defendant had no title to pass to 2nd Defendant (nemo dat principle) citing Foo Ah Kow v. Yeap Poh Lum & Ors.[2016] 6 CLJ 686 and Ishmael Lim Abdullah v. Pesuruhjaya Tanah Persekutuan & Anor [2014] 7 CLJ 882. 25 [9] In relation to 2nd Defendant’s Counterclaim the learned trial Judge findings are -

(i) the 2nd Defendant was unable to prove that Wan Majid was the 30 lawful and beneficial owner of the said Property and 2nd Defendant as administrators of Wan Majid’s estate was not entitled to be proprietors of the said Property; and 10 5

(a) Maple Resources’ letter dated 18/4/1992 to Wan Majid (RR Jld 2(2)/315); and 15

(b) Arkitek Akiristik’s letter dated 10/4/1992 to Yang Dipertua Majlis Perbandaran Petaling Jaya (‘MPPJ’) (RR Jld 2(2)/316 ). [11] The Plaintiff’s Counsel objected to the admission of the 2 20 impugned letters as fresh evidence which was upheld by the learned trial Judge. With respect we find the learned trial Judge had erred in refusing the admission of the 2 impugned letters and thereby not considering the same in determining the case on a balance of probabilities. 25 [12] Our justification as to why the 2 impugned letters are admissible are as follows:

(a) The rationale behind the Court of Appeal granting the parties “liberty to recall witnesses” is clearly spelled out as follows: 30 “We are constrained to take this unusual step to remit this case to the trial judge to have further evidence for the Official Receiver, both orally and documentary by reason of the omission of the Official Receiver in not making 11 available relevant and necessary document pertaining to R1 which in Official 5 Receiver’s custody and possession.”

(b) We observed that that the issue of Maple Resources through its architect, Messrs. Arkitek Akiristik building a dwelling house on the said Property for Wan Majid had been introduced and given by Hj. Omar in 10 his oral testimony and the Statutory Declaration (‘SD’) dated 28/3/2001(exh.D3, RR Jld2(2)/308-309) prepared by the Directors of 1st Defendant namely, Omar bin Othman (‘Hj. Omar’) and Mohd @ Ahmad bin Mohd Said. In the SD, the Directors had exhibited the form by which Messrs. Arkitek Akiristik had applied to MPPJ to build a house “Membina 15 sebuah banglo 2 ½ tingkat” on the said Property for Wan Majid and describing the latter as “Pemilik Bangunan” (exh.P5, RR Jld 2(2)/314). We recalled that Hj. Omar was one of the witnesses called by the OR pursuant to the Court of Appeal Order; therefore the 2 impugned letters are indeed an extension of the evidence of Hj. Omar and ought 20 to have been admitted.

(c) By the 2 impugned letters, Maple Resources had, among others, confirmed that they through their architect, Messrs. Arkitek Akiristik had submitted the building plans to MPPJ to build a dwelling house on the 25 said Property for Wan Majid. We therefore find these 2 impugned letters were relevant to the issue that if Maple Resources had purchased the said Property from the 1st Defendant and thereafter given the said Property to the Plaintiff by way of a set off for money advanced as alleged by him, then it is only logical that Maple Resources would not be 30 constructing a dwelling house on the said Property for Wan Majid. Hence these 2 impugned letters ought to have been admitted by the learned trial Judge as part of the evidence to be considered by him. 12 5 Whether Maple Resources had paid the full purchase price under the Sale and Purchase Agreement dated 1/10/1991 to complete the purchase of the said properties including the said Property from the 1st Defendant 10 Whether the Plaintiff had advanced money to Maple Resources to enable it to purchase properties including the said Property from the 1st Defendant Whether the Plaintiff, as director of Maple Resources had the right 15 to set-off the money purportedly advanced by him to Maple Resources by opting to take the said Property [13] With respect we are of the view that the learned trial Judge’s findings in para 8(a) and (b) above is erroneous for the following 20 reasons:

(a) The Plaintiff relied on a Sale and Purchase Agreement dated 1/10/1991 entered between the 1st Defendant (vendor) and Maple Resources (purchaser) (‘the S&P’) (Rekod Rayuan RR Jld 2/2 pp.163- 25 169). According to the Plaintiff, the said Property was one of the 56 properties sold by the 1st Defendant to Maple Resources for RM4.5 million. The 2nd Defendant had challenged the Plaintiff to show the S&P was in fact completed in that Maple Resources had paid the full purchase price to the 1st Defendant to purchase the 56 properties. 30 However when cross-examined the Plaintiff could not adduce any such evidence; but went on to admit that he did not know whether Maple Resources had actually settled the full purchase price to the 1st Defendant. 35

(b) We are inclined to agree with the 2nd Defendant’s submission that if indeed Maple Resources had paid the balance purchase price of 13 RM3.785 million and completed the S&P transaction, it would have 5 taken steps to transfer and register the 56 properties into its name given that the 1st Defendant had been wound up in 1993.

(c) Further Hj. Omar, the 1st Defendant’s Managing Director and contributory testified that Maple Resources never settled the purchase 10 price under the S&P by 31/10/1991. Consequently the 1st Defendant was unable to pay off its debts and ended up being wound up on 26/8/1993.

(d) From the evidence adduced what could be inferred is that since 15 Maple Resources did not pay the full purchase price for the 56 properties (which is inclusive of the said Property), it meant that it never bought those properties from the 1st Defendant. As a logical consequence, Maple Resources could not allow a set-off by way of giving the Plaintiff that which Maple Resources itself did not own.

(e) Under cross-examination the Plaintiff stated that he did not give any loan to Maple Resources to buy the 56 properties but he had injected funds as his investment into Maple Resources when the latter was first incorporated. The relevant evidence is reproduced - 25 “P/Def: You say you gave advances to Maple, how many advances, how many loan did you make? One time or several times? Yang Arif, I don’t understand, actually I invested in the company and how come the lawyer said its a loan. No the advance. The advance that you gave the money that you 30 gave by way of an advance. Witness keep answering that, this is not a loan, this is in fact investment. I invest in this company then the company thereafter 14 using the funds also to make investment as well. How could this be 5 considered as a loan. So my question now is using his own words, he said he given advances to the company. So how many advances did he give? Yang Arif, when we incorporated the company at the beginning, I have injected funds into the company, thereafter I cannot 10 remember whether I have injected more funds. When they what? Sorry When the company was incorporated.” (Emphasis added) (Notes of Evidence (NOE) Rekod Rayuan Tambahan (RRT) p.41 15 line 23 to p.42 line14).

(f) The Plaintiff did not produce any documentary proof of him having made any advance or investment in Maple Resources. Neither did he call any current officer from Maple Resources to testify or to produce 20 documents to show that he had made such an advance to Maple Resources. The Plaintiff when cross-examined could not even say how many advances he had made and the amount he had advanced to Maple Resources (RRT p.42 line 15 to 20). 25

(g) We observed that the Plaintiff in his witness statement at the 2nd trial surprisingly could suddenly testify that he had advanced RM333,000.00 sometime in 1992 or 1993 (SP-2A Q&A2) which we note was repeated by Tee Ching Huat in his witness statement (Q & A1 SP- 1A). However when cross-examined the Plaintiff admitted that he did 30 not have any document to support the veracity of his statement. Likewise for Tee Ching Huat. We can only conclude that their statements are but bare allegations. Further, we find that this evidence of the Plaintiff and Tee Ching Huat in fact contradicted the above quoted 15 evidence of the Plaintiff that he did not give any loan but he had injected 5 funds into Maple Resources when it was incorporated.

(h) We are of the view the probative value of the Plaintiff’s testimony that he had advanced RM333,000.00 to Maple Resources sometime in 1992 or 1993 is again thrown into doubt in the following circumstances:

(i) Based on Form 49 (Return of Particulars In Register Of Directors, Managers And Secretaries And Changes Of Particulars (RR Jld 2(2)/ 158 and Form 24 (Return of Allotment of Shares), both in respect of Maple Resources, it can be seen that the company was already in 15 existence in 1990. We are inclined to agree with the 2nd Defendant’s submission that any claim that the funds were advanced in 1992 or 1993 would be contradictory to the Plaintiff’s own evidence under cross-examination that he injected funds during Maple Resources’ incorporation.

(a) there was no documentary evidence that Wan Majid had paid monies to purchase the said Property and reliance was placed on the evidence in cross-examination by the Plaintiff’s Counsel of Ita (DW1) at 10 (Notes of Evidence (NOE) p.21 line 8 to p.22 line 10, NOE p.23 line1-13, NOE p.25 line 20 to p.26 line 23 and of Hj Omar (DW2) at NOE p.46 lines 4-22 and NOE p.49 lines 2-7) submitting that these witnesses admitted there was no proof of payment; 15

(b) the 2nd Defendant did not bother to call additional witnesses to corroborate and/or cross-examine the Plaintiff and 1st Defendant‘s witnesses regarding the issue of whether Wan Majid paid monies to purchase the said Property and failed to provide any statement of account to show the payment of RM150,000.00 was paid by Wan Majid 20 to Plaintiff; and

(c) the 1st Defendant seemed clueless on whether Wan Majid had made payments for the said Property. 25 [15] With respect we are unable to agree with the Plaintiff’s aforesaid submission and in our judgment the learned trial Judge had erred on account of the following reasons. [16] We find the learned trial Judge had failed to consider and analyse 30 the evidence of - [16.1] Ita Idzwati, oral and documentary as follows: 17

(i) letter dated 29/3/2001 (exh.D8, RR Jld 2(2) pp.295) from 5 Wan Majid to the OR enclosing the SD of Hj.Omar; and Wan Majid had in para 3 of his letter referred to para 6 of the SD wherein the 2 Directors of 1st Defendant “mengesahkan persetujuan mereka menyerahkan Lot P.T.22, Mukim Damansara, Kelana Jaya sebagai ganti RM150,000.00 dan 10% deposit yang tidak pernah 10 dijelaskan atau dibayar kepada saya (Wan Majid) sehingga ke hari ini.”;

(v) the Sales and Purchase Agreement dated 10/10/1988 entered between Wan Majid and the 1st Defendant (of which 1st Defendant is the registered and beneficial owner of Lot 9106) 10 wherein Wan Majid had agreed to purchase Lot 56 together with a double storey bungalow house for RM250,000.00 (exh.D7, RR Jld 2(2) pp. 273-294 );

(i) he confirmed that the sale and purchase of the 56 properties were not completed because Maple Resources had failed to pay the purchase price; 20

(v) he confirmed the swap over deal between the 1st Defendant and Wan Majid pertaining to the said Property (NOP RR Jld 2(1) p.111, cross-examination by Plaintiff’s Counsel) and evidence in cross- 10 examination by 2nd Defendant’s Counsel (NOP RR Jld 2(1) pp. 117-120). He confirmed the contents of the SD and admitted he signed the SD. [17] We observed that the Sales and Purchase Agreement dated 10/10/1988 pre-dated the time when the Plaintiff alleged that he had 15 advanced money to Maple Resources (1992 or 1993); [18] The learned trial Judge appeared to have been swayed by the Plaintiff’s simplistic argument that there was no receipt produced to show payment of the RM150,000.00 by Wan Majid (NOP RR Tambahan 20 p.140 lines 9-11). In fact the Plaintiff himself said that he could not produce any proof of money advanced by him to Maple Resources because it took place so long ago (in 1992 or 1993). We are of the view that the Plaintiff’s argument on the failure of Wan Majid to adduce the actual receipt is of no probative value because Hj. Omar had testified in 25 Court that the payment and receipt of the money as having been paid by Wan Majid through his explanation of the events leading to the said Property being given to Wan Majid for the consideration of RM150,000.000. This can also be gleaned from the evidence of the Senior Insolvency Officer. 30 21 [19] In his Grounds of Judgment, the learned trial Judge merely 5 mentioned the evidence of Hj. Omar once by way of reciting his evidence as follows (para 28 p.19 RR Tambahan): “Osman Omar (SD2) was the former Director of Kastria. He testified that the late Wan Majid was his friend and he had asked Osman to prepare the statutory declaration (D3). He further testified that, as the company could not 10 allocate Lot 56, the Company agreed to pay back the amount of RM150,000.00 including whatever it is or the Company will provide another lot.” [20] In our view the fact that Hj. Omar was a friend of Wan Majid does 15 not minimise the probative value of the SD because of the explanation proffered by Hj. Omar as to how the SD was prepared 25 years ago (see para 16.2 above) and his testimony that “the most important thing … in [the SD] is para 5, which … explain a lot of thing what has transpired earlier and which … exactly what is the situation at the moment …”. 20 [21] Thus we find that the learned trial Judge erred in failing to appreciate and evaluate the evidence of Hj. Omar and Ita Idzwati which we have alluded to. We are of the view that the OR had duly and properly carried out his statutory duty as the Court appointed liquidator 25 prior to executing the memorandum of transfer Form 14A in respect of Lot P.T.22 Mukim Damansara, Selangor in favour of Wan Majid. Had the learned trial Judge considered, appreciated and weighed all the evidence of Hj. Omar and Ita Idzwati, we are of the view that on a balance of probabilities, the learned trial Judge would have arrived at a 30 finding that the Defendants had proved that Wan Majid had made full payment of the purchase price of the said Property just as we did. 22 Whether Plaintiff was a bona fide purchaser for value of the said 5 Property and whether Plaintiff purchased the said Property from 1st Defendant including sale and purchase agreement with 3rd party, receipt of notice of assessment and payment thereof and possession of original title by Plaintiff [22] We are of the view that the Plaintiff is not a bona fide purchaser 10 for value of the said Property premised on the following reasons:

(a) There is no sale and purchase agreement between the Plaintiff and the 1st Defendant in relation to the said Property. 15

(b) The Plaintiff did not make any payment to the 1st Defendant as the registered proprietor for the purchase of the said Property. Rather the Plaintiff admitted in cross-examination that he took the said Property from Maple Resources as a return on his investment in the same. Assuming that the Plaintiff did advance monies to Maple Resources 20 (which we held otherwise), we are of the considered view that Plaintiff’s interest is purely a monetary one i.e. Plaintiff’s claim is a claim in personam against Maple Resources for the purported monetary advance or investment made by him to Maple Resources which does not give the Plaintiff a claim to or an interest in the said Property. 25 In this regard we are supported by the authority of Score Options Sdn Bhd v. Mexaland Development Sdn Bhd [2012] 7 CLJ 802, where the appellant was a registered proprietor of a piece of land. The appellant entered into a joint venture project management agreement (JVPM Agreement) with the appellant’s subsidiary company and the 30 respondent to develop the land. Under the JVPM Agreement, the appellant’s subsidiary company was the developer while the respondent was appointed the project manager and two power of attorneys were 23 executed in favour of the respondent giving it the rights in respect of the 5 development project. In return the respondent would pay the appellant and the appellant’s subsidiary company a guaranteed sum of a certain amount for each type of building developed. The respondent entered a private caveat against the whole land instead of just the project land as it was entitled to. A dispute arose between the parties when the 10 respondent failed to launch the project resulting in the appellant terminating the JVPM Agreement. Among others, the High Court dismissed the respondent’s ex parte application for extension of the caveat until the final determination of the suit holding that the JVPM Agreement did not vest in the respondent any caveatable interest so as 15 to entitle them to lodge a caveat. The respondent’s appeal to the Court of Appeal was allowed. Two questions of law arose on the leave to appeal granted to the appellant: (a) whether a party to a joint venture agreement to develop land for a profit has caveatable interest in the land; and (b) whether a person must demonstrate that he comes within 20 s.323(1) National Land Code to entitle him to lodge/maintain a private caveat on the land, notwithstanding the existence of an agreement which allows him to enter the private caveat. The Federal Court answered question (a) in the negative and question (b) in the positive. Arifin Zakaria CJ (as he then was) (delivering the judgment of the 25 Federal Court) at 819 [37] opined - “Reverting to this appeal before us, although the appellant has conferred numerous rights on the respondent under the JVPM Agreement and the powers of attorney, all these rights are merely rights to develop the land that would give rise only to a monetary interest, ie, a right in personam 30 against the appellant and does not create any interest in the land.” (Emphasis added) 24 (See also Kundang Lakes Country Club Bhd v. Garden Masters (M) 5 Sdn Bhd [1999] 2 CLJ 633 (CA) at p.637 f-h & p.638 a). [23] We agreed with the 2nd Defendant’s submission that the fact that the Plaintiff tried to sell the said Property does not in law make him the owner of the said Property as he was simply trying to sell that which did 10 not belong to him in the first place. [24] Further we find it is incomprehensible how the name of the Plaintiff could be in the assessment receipt of the said Property, notwithstanding that the Plaintiff had never been the registered proprietor of the said 15 Property. This the Plaintiff failed to explain. [25] In addition we are of the view that possession of the said title per se did not prove the Plaintiff was the beneficial owner of the said Property as the title was not given to the Plaintiff by the 1st Defendant or 20 by the OR as proof of his ownership to the said Property. [26] For all the foregoing reasons we find the learned trial Judge erred in his findings in para 8 (e) above. 25 Whether the Plaintiff is the beneficial owner of the said Property and that the 1st Defendant is holding the said Property as a bare trustee for the 1st Defendant [27] Given that the Plaintiff’s interest is purely monetary and he has no proprietary interest in the said Property, we are of the considered view 30 that he cannot be the beneficial owner of the said Property. 25 5 [28] In M & J Frozen Food Sdn. Bhd. & Anor. v. Siland Sdn. Bhd. & Anor. [1994] 2 CLJ 14, the Supreme Court at p.19 c-f right column opined - “The position under our case law is however a little less demanding. According to the authorities, on the execution of the contract payment of the 10 full purchase price and the delivery of the document of title, the vendor becomes a constructive trustee for the purchaser and the latter acquires an equitable right on the land. In Temenggong Securities Ltd. & Anor. v. Registrar of Titles, Johore & Ors. [1974] 2 MLJ 45, Ong Hock Sin FJ after consulting various English 15 authorities expressed the Court's judgment in the following terms: The law is clear that the vendors, after receipt of the full purchase price and surrender of possession of the lands to the appellants are bare trustees for the appellants of the said land and it must consequently follow, as night must day, that the vendors have no 20 interest in the lands which can be the subject matter of a caveat. In the same case Gill FJ expressed the opinion that the vendor became a constructive trustee when the full purchase money had been paid and the purchaser has received the instruments of transfer and the title deeds. 25 … It would appear from the above-cited cases that the vendor is regarded as having divested himself of all the beneficial interest in his land and 30 vested it on the purchaser only at the time when the memorandum of transfer is executed and the purchase money is paid in full - see Karuppiah Chettiar v. Subramaniam [1971] 2 MLJ 116 at 119.” (Emphasis added) 35 26 [28.1] Similar principles were reiterated in the Federal Court case of Tan 5 Ong Ban v. Teoh Kim Heng [2016] 3 CLJ 193 at 205 [33], [34] and [35]. [29] Thus from the case of M & J Frozen Food Sdn. Bhd. (supra) and Tan Ong Ban (supra), it is clear that the following requirements must be 10 satisfied in order for there to be a bare trust -

(i) there must be a contract/agreement for the sale of property;

(v) the owner must have given to the purchaser a duly executed, 25 valid and registrable memorandum of transfer in due form (Form 14A) in favour of the purchaser. [29.1] Thereafter upon the fulfilment of the aforesaid requirements, that a purchaser will acquire a beneficial title to the said property and an 30 owner of the property will be regarded as having divested his interest in and over the property and hold the same as bare trustee for the purchaser. 27 5 [30] Applying the legal principles gleaned from the above quoted authorities, we find the Plaintiff failed to prove a bare trusteeship in his favour because -

(a) he did not contract with the 1st Defendant to purchase the said Property;

(b) he did not pay any purchase price to the 1st Defendant but instead he claims to have advanced monies or invested in Maple; and

(c) the 1st Defendant did not deliver a duly executed, valid and registrable memorandum of transfer in due form (Form 14A) in favour of the Plaintiff to divest its interest to the Plaintiff. 15 [31] Based on the evidence, as a matter of law the 1st Defendant had never held and does not hold the said Property as bare trustee for the Plaintiff and the Plaintiff is not the lawful and beneficial owner of the said Property. Thus in our judgment the learned trial Judge erred in para 8 (f) 20 above when he allowed the Plaintiff’s claim for a declaration that he is the beneficial owner of the said Property and that the 1st Defendant is holding the said Property as a bare trustee for the Plaintiff. Whether Wan Majid was a bona fide purchaser for value of the said 25 Property without any notice of any purported claim or interest by Plaintiff [32] By a letter dated 6/6/2001 (RR Jld 2(2)/225), the OR had executed a memorandum of transfer (Form 14A) and stamp duty form (PDS15) in favour of Wan Majid and forwarded the same to Wan Majid. To reiterate, 30 the memorandum of transfer was duly executed by Wan Majid and the then OR in the following terms: 28 “(a) Sebagai balasan wang sebanyak RM150,000.00 ringgit yang dengan 5 ini saya mengaku telah terima …

(b) Dengan ini memindahkan kepada penerima pindahmilik yang tersebut 10 dibawah ini segala hakmilik atau kepentingan sebagaimana yang ada pada saya.” [33] Based on the memorandum of transfer we find (i) that Wan Majid had paid a sum of RM150,000.00 as consideration for the transfer of the 15 said Property in his favour; and (ii) that the 1st Defendant through the OR had acknowledged receipt of that sum and had transferred all of the 1st Defendant’s title and rights in the said Property to Wan Majid as evidenced by the memorandum of transfer. 20 [34] In fact in contrast to the Plaintiff’s position, based on the evidence, and on a balance of probabilities, we find that the 1st Defendant is holding the said Property as a bare trustee for Wan Majid as the legal requirements for the existence of a bare trust have been fulfilled in that - 25

(i) Wan Majid had purchased the said Property directly from the 1st Defendant as the registered proprietor;

(v) the 1st Defendant through its liquidator as the registered proprietor had given to Wan Majid a duly executed, valid and registrable memorandum of transfer in due form (Form 14A) in favour of Wan Majid”. 15 [35] The principle of beneficial ownership is aptly elucidated by Arifin Zakaria CJ (delivering the judgment of the Court) in Tan Ong Ban at 205[34] as follows: 20 “According to this principle, when a purchaser of a property has performed his or her contractual obligation upon the full settlement of the purchase price besides executing all the formal documents to effect the registration of ownership, equity accords him or her with all the rights and privileges of a legal owner over the property. The purchaser thus enjoys the benefit of being 25 the owner of the acquired property even though he or she has yet to become its registered owner.” Thus in law following the decisions of M & J Frozen Food Sdn. Bhd. and Tan Ong Ban, with the full payment by Wan Majid and the 30 execution and delivery of the memorandum of transfer in favour of Wan Majid, the 1st Defendant had divested all of its beneficial interest in the said Property and vested that beneficial interest on Wan Majid. 30 5 [36] Accordingly, coupled with the reasons stated in para 14 through to 21 above, we find the learned trial Judge erred in his finding in para 9 above that the 2nd Defendant failed to prove its Counterclaim. Whether the 1st Defendant had any title in the said Property and to 10 pass to Wan Majid [37] We find the learned trial Judge’s finding at para 8(h) above that the 1st Defendant never had any title in the said Property to pass to Wan Majid is misconceived. This is because Maple Resources did not complete the S&P by paying the full purchase price resulting in it not 15 having purchased the said 56 properties, ownership and title in and to those 56 properties (including the said Property) never passed to Maple Resources and remained with the 1st Defendant. Thus in our judgment the 1st Defendant did have the title to pass to Wan Majid. 20 Whether Plaintiff’s claim is barred by limitation and/or laches [38] Finally assuming we are wrong in our finding that the Plaintiff does not have a claim to the said Property, we are of the considered view that the Plaintiff’s action is time barred pursuant to s.9 of the Limitation Act 1953 (‘Limitation Act’). S.9 of the Limitation Act provides - 25 “9. Limitation of actions to recover land.

At all material times up to July 2014, he was represented by a solicitor, Mr. A.K. Lee. For almost 23 years (up to the filing of the suit 20 herein), the Plaintiff (i) did nothing to transfer the said Property into his name, (ii) there is no evidence that the Plaintiff or his solicitor had contacted the liquidator of the 1st Defendant to assert his claim to the said Property and (iii) neither did he lodge any private caveat. 25 [42.1] Wan Majid on the other hand had lodged a private caveat. After his demise, the 2nd Defendant as administrators continued to lodge fresh caveats to give notice to the world of the interest of Wan Majid to the said Property (RR Jld 2(2)/245 & 246). 30 [42.2] By reason of the aforesaid, we are of the considered view that the Plaintiff is guilty of laches and his claim (which we held otherwise) to the said Property ought to be defeated and struck out. 33 Conclusion 5 [43] For all the foregoing reasons we have shown how the learned trial Judge had failed to give sufficient judicial appreciation of all the evidence and had omitted to consider and/or evaluate or give sufficient weight to the evidence. Under such circumstances we find there are merits in the appeal which compelled us to exercise our appellate intervention 10 following the Federal Court in Gan Yook Chin & Anor v. Lee Ing Chin & Ors. [2004] 4 CLJ 309 which endorsed the view of the Court of Appeal in Lee Ing Chin & Ors. v. Gan Yook Chin & Anor [2003] 2 CLJ 19 and followed in Ho Hup Construction Company Bhd v. Woo Thin Choy [2015] 9 CLJ 706 at 730 [64]. 15 [44] Accordingly we unanimously made the following Order:

(a) allowed the 2nd Defendant’s appeal with global costs of RM20,000.00 to be paid by the Plaintiff to the 2nd Defendant subject to the payment of allocator;

(b) set aside the decision of the High Court made on 20/3/2018;

(c) allowed the Counterclaim of the 2nd Defendant in para A of the Defence and Counterclaim of the 2nd Defendant;

(d) allowed security for costs of RM10,000.00 together with interest to be refunded to the 2nd Defendant. 25 30 34 5 Dated: 1/8/2019 Sgd. LAU BEE LAN 10 Judge Court of Appeal Malaysia Putrajaya 15 COUNSEL: Jasmeetpal Singh for the Appellant [Messrs Siew & Jasmeet] 20 Dinesh Praveen Nair for the 1st Respondent (Dexter Lee with him) [Messrs Dinesh Praveen Nair] 25 SFC Mohamad Hanafi bin Basri for the 2nd Respondent [Jabatan Insolvensi Malaysia]