Removal of Private Caveat

1. Withdrawal of X’s private caveat

Instead of immediately applying under s.326 or s.327, it is better if A or B can first ask X if he would withdraw the caveat.
s.325 provides that the caveator may withdraw the caveat. If he withdraws it on his own, then there would be no need to
apply for removal under s.326 or s.327.

s.329(1) provides that any person who wrongfully or without reasonable cause fails to withdraw any private caveat shall be
liable to pay compensation to any person who suffers damage or loss.
To claim, the person relying must prove that loss or damage has been suffered. Cheng Chin Chong; Mawar Biru

However, it is unlikely that X would want to withdraw the caveat, then we have to decide whether to apply for removal
under s.326 or s.327.

2. Removal of X’s private caveat

Purchaser
If P wants to apply for removal of X’s caveat she cannot apply under s.326 as applicants for removal under s.326 are
confined to those with registered title or interest.
Hence, P can only apply for removal to the court under s.327.

“Aggrieved person”
In order to show that P has locus standi to make the application under s.327, she will first have to satisfy the court that she
is aggrieved by the existence of X’s private caveat
Tengku Mohamed v Waizurayah must first show there are sufficient grounds in fact and law in order to make her aggrieved
by the existence of X’s caveat.
 Noratahar bin A Hamid v Abdullah Hassan & Ors the P was an aggrieved person in that if not for the caveats, the P
would have succeeded in becoming the registered owner of the said land.
P is clearly aggrieved as it is preventing her from getting the transfer registered and she has already paid the full
purchase price.
- Burden discharged- once P has shown that she is aggrieved by X’s caveat, the burden is on X to satisfy the court
that the caveat should remain.

3 stage test as stated in Kumpulan Sua Betong v Dataran Segar; Luggage Distributors; Murugappa Chettiar

X has to show:
(i) He has a caveatable interest within the meaning of s.323(1); if yes

s.323(1) provides that in order to show a caveatable interest he has to show that he was claiming title or registrable
interest in land or undivided share or right to such title or registrable interest in the land or undivided share.

 Here, the caveat was entered based on the sale and purchase agreement entered into on 00.00.0000 when the RM X
deposit was paid and under which caveator was to pay the balance of purchase price of RM Y by xx.xx.xx. As X did not
pay the balance of the purchase price by xx.xx.xxxx, Y had terminated the agreement and forfeited the deposit.

In Chia See Yin & Ors v Yeoh Kooi Imm, the court held that where the vendor has validly terminated the sale and
purchase agreement because of the purchaser’s failure to pay the balance of the purchase price within the stipulated
period, the latter has no caveatable interest.

Since caveator will not be able to show a caveatable interest, the court will not allow the caveat to remain, and need
not consider the 2 remaining stages.
(ii) He has to show that his claim raises a serious question to be tried; if yes
(iii) He has to show that on a balance of convenience, it would be better to allow the caveat to remain until the trial of the
action.

Registered proprietor
M as registered proprietor can apply for removal under s.326 to the registrar. Under s.326, M applies to the registrar with Form
19H together with the prescribed fee.
Upon receipt of the application, the Registrar will serve Form 19C on caveator. Once notice in Form 19C has been served on
caveator, s.326(1B) provides that caveator’s caveat shall lapse and be of no effect unless before the expiry of 2 months, her
applies (OS + affidavit) for and obtains an extension order from the court and serves it on the Registrar (normally the application
for extension is serve on caveatee, but s326(2) allows such application to be heard ex parte, if the circumstances so require).
As a registered proprietor, M also has an option to apply under s.327 and she doesn’t have to first show that he is aggrieved by
caveator’s caveat. The burden is placed on the caveator to show that the caveat ought to remain.
In any event the caveat will be removed as caveator will be unable to satisfy the 3-stage test.

Granting of extension order

Eng Mee Yong
Caveator as the applicant under s.326 for the extension of the duration of the caveat has the burden of satisfying the court that
there are sufficient grounds in fact and in law for the caveat to be extended.
The same test would be used by the court in deciding whether to extend the caveat as is used in deciding whether to allow the
caveat to remain on an application for removal under s.327.

Caveator will not be able satisfy the first condition of 3 stage test in Kumpulan Sua Betong as he has no caveatable interest.
1. Caveatable interest
2. Serious question to be tried
3. Balance of convenience

Scenario:
P’s application to extend its private caveat because the reserve price is much lower than valuation price but the certificate of
sale has been given to successful bidder.

Urethan Systems Sdn Bhd v Quek Yak Kang

A close scrutiny of the plaintiff’s SOC revealed that it was claiming the loss being the difference of their valuation and the
reserve price. That was the crux of the plaintiff’s grievance and by reason thereof plaintiff’s claim was one based on monetary
loss. The law is clear that it can never give rise to a caveatable interest and hence the plaintiff’s caveat was patently wrong and
no extension could be availed of in respect of a wrongful caveat.

Removal of Registrar’s Caveat

s.319(1)(a) provides that a RC may be entered by the Registrar on the RDT in any of the circumstances specified in s.320.
s.320(1)(ba) allows the registrar to enter a RC on the taxpayer’s land on the basis of an income tax debt at the request of Inland
Revenue Board. MBF Finance BHd v Pendaftar Hakmilik Negeri Perak
the RC does not creat any interest in land but just to restrict dealing of the land and acts as an attachment until the department
takes action and obtains judgment.

Bare trust concept

Equitable owner

Borneo Housing Mortgage v Time Engineering

The court held that the purchase becomes the equitabl owner and the vendor becomes the bare trustee upon 3 conditions
being satisfied:
i. The purchaser had paid the full purchase price
ii. The vendor has given the purchaser a duly executed, valid and registrable transfer form. i.e. executed the MOT and
also handed over the IDT.
iii. The case must be one of which the court would have been prepared to exercise its discretion to grant specific
performance.

Wu Shen Chen
The COA held following Borneo that only the first 2 conditions had to be satisfied.

A RC cannot be entered against a person who has parted with his title or interest in land to the purchaser and is merely holding
as bare trustee Temenggong securities v Registrar of Titles, Johor.

Application for Removal of RC

s.321(3) provides that a RC shall continue in force until it is cancelled by Registrar’s pursuant to one of the circumstances in sub
(3)

registered proprietor -> s.418

purchaser -> would not be able to apply under s.418 as the registrar would not have communicated his decision to enter the
caveat on purchase by serving notice in form 19A on her. Hence it would not be possible to see when the 3 month period
provided in s.418 start to run. It is submitted that purchaser may be able to apply for declaratory relief under O15r16 RC 2012
and s42 Specific Relief Act