CAVEAT

ISSUE 1
• WHETHER HJ. SOLEH CAN ENTER A PRIVATE CAVEAT ON THE LAND?
• WHY PRIVATE CAVEAT
• THE REASON WHY THE TYPE OF CAVEAT THAT HE MAY ENTER IS PRIVATE CAVEAT IS BECAUSE IT
IS THE MOST SUITABLE CAVEAT TO BE APPLIED.
• PRIVATE CAVEAT IS THE MOST SUITABLE ONE BECAUSE IT IS DESIGNED FOR AGGRIEVED PARTY
AND MAY BE LODGED BY AN INDIVIDUAL. MEANWHILE, LIEN-HOLDER’S CAVEAT IS NOT SUITABLE
BECAUSE HAJI SOLEH IS NOT A LIEN HOLDER. ALSO, REGISTRAR CAVEAT IS NOT SUITABLE
BECAUSE IT IS TO BE APPLIED BY THE GOVERNMENT. MOREOVER, TRUST CAVEAT IS NOT
SUITABLE BECAUSE HAJI SOLEH IS NOT A TRUSTEE.
 SECTION 323 OF NLC- WHO MAY APPLY
• 323 (1)(A)- 2 LIMBS
• 1ST LIMB- REGISTERED PROPRIETOR
• 2ND LIMB- EQUITABLE RIGHTS OUT OF CONTRACT
 1ST LIMB
• KUMPULAN SUA BENTONG V. DATARAN SEGAR
• REGISTERED PROPRIETOR.

• STANDARD CHARTERED V. YAP SING YOKE

• ‘PERSON CLAIMING A REGISTRABLE INTEREST’
 2ND LIMB- LIBERAL INTERPRETATION
• MACON ENGINEERING’S CASE
• “ALLEGED”
• NO NEED TO SHOW SPA
• JUST NEED TO SHOW THAT YOU ARE THE AGGRIEVED PARTY.
 WONG KUAN TAN V. GAMBUT
• WIDE ENOUGH TO COVER RIGHTS UNDER CONTRACT.
• HOWEVER, NOT WIDE ENOUGH TO COVER ‘MERE PERSONAL RIGHT’
• “MERE PERSONAL RIGHTS” – EG. LIKE BUYING TICKET FOR CINEMA.
 APPLICATION
• BY VIRTUE OF SECTION 323 (1)(A), HAJI SOLEH MAY ENTER A PRIVATE CAVEAT.
• HE HAS EQUITABLE RIGHTS UNDER CONTRACT.
• THIS WAS SHOWN WHEN HE BOUGHT THE LAND FROM MR. LIAM AND PAID 50% ALREADY.
• HENCE, HAJI SOLEH MAY ENTER A PRIVATE CAVEAT TO SECURE HIS RIGHTS.
• 2) WHAT IS THE LEGAL POSITION OF MONEY & CENTS BANK?
 LIEN

• HALSBURY LAW OF ENGLAND

‘LIEN IN ITS PRIMARY SENSE IS A RIGHT IN ONE MAN TO RETAIN
THAT, WHICH
IN HIS POSSESSION BELONGING TO ANOTHER MAN UNTIL CERTAIN
DEMANDS
OF THE PERSON IN POSSESSION ARE SATISFIED.’
PALANIAPPA CHETTY V DUPIRE BROTHERS & ANOR
‘A LIEN IS ONE AND A SPECIAL FORM OF SECURITY.’
 HOW TO CREATE A LIEN?

1. THE PROPRIETOR OF THE LAND MUST DEPOSIT THE IDT TO THE LENDER FOR EXCHANGE
FOR A LOAN. (S 281)
2. THE LENDER NEED TO ENTER THE LIEN-HOLDER’S CAVEAT TO THE SAID LAND UNDER
NATIONAL LAND CODE (S 330)
BEFORE ENTER LIEN-HOLDER’S CAVEAT
1. ELEMENT OF PROPRIOTERSHIP – ONLY THE PROPRIETOR OF THE LAND
OR LESSEE CAN DEPOSIT THE IDT
2. ELEMENT OF DEPOSIT
3. ELEMENT OF INTENT
 APPLICATION

 MR LIAM IS THE REGISTERED PROPRIETOR OF THE LAND.

 HE THEN DEPOSITED THE IDT TO THE DOLLAR & CENTS BANK AS A SECURITY FOR AN
OVERDRAFT FACILITY.
 THE IDT WAS HELD BY THE BANK. MR LIAM’S LAND HAD BECOME A SECURITY AND THE
BANK IS THE LENDER OF MONEY TO MR LIAM.
 AS A CONCLUSION, THE POSITION OF THE BANK IS JUST A LIEN HOLDER EVEN THOUGH
THERE IS NO LIEN-HOLDER’S CAVEAT HAD BEEN ENTERED BY THE BANK.
 3) WHETHER THE SAID REGISTRAR’S CAVEAT WAS VALIDLY ENTERED BY THE
REGISTRAR AND WHY?

• - SECTION 319 ( REGISTRAR POWER’S TO ENTER REGISTRAR’S CAVEAT)

• CASE : PENDAFTAR HAK MILIK NEGERI KEDAH V OCBC
• - SECTION 320 ( CIRCUMSTANCES FOR ENTRY OF REGISTRAR’S CAVEAT)
• - SECTION 321( PROCEDURE FOR ENTRY OF REGISTRAR’S CAVEAT)
 APPLICATION

• ASSUMING THAT THE REGISTRAR’S HAS SATISFIED THAT THE INFO OR MATERIAL PRESENTED TO
HIM IS CREDIBLE, HE MAY ENTER REGISTRAR’S CAVEAT BY FILL IN FORM 19F UNDER GROUNDS
TO SECURE DEBT DUE TO THE FEDERATION (INCOME TAX).
• HE HAS ALSO SERVED WITHIN REASONABLE TIME NOTICE IN FORM 19A TO MR.LIAM
NOTIFYING THE MATTER.
 4 TH
ISSUE-
WHETHER MONEY & CENTS
BANK AND HJ SALEH CAN
REMOVE THE REGISTRAR'S
CAVEAT ON THE SAID LAND?
• 1. REMOVAL OF REGISTRAR'S CAVEAT CAN BE DONE IN 3 WAYS STATED IN
SECTION 321 (3) NLC:
• A) BY REGISTRAR OF HIS OWN MOTION
• B) ON AN APPLICATION BY THE PROPRIETOR OF THE CAVEATED LAND
• C) PURSUANT TO A COURT GRANTED TO THE PROPRIETOR AGAINST THE REFUSAL
OF THE REGISTRAR TO REMOVE THE CAVEAT UNDER SECTION 418 OF NLC

• APPLICATION:
• MONEY & CENTS BANK:- IS APPLIED TO SECT 321 (3) (C ). BASICALLY,
ACCORDING TO SECTION 418, THE BANK IS AN AGGRIEVED BODY MUST APPEAL
TO THE HIGH COURT WITHIN 3 MONTHS FROM THE DATE THE DECISION WAS
COMMUNICATED TO HIM.
• SUCH CASE IN DEVELOPMENT & COMMERCISL BANK V LAND ADMINISTRATOR
WILAYAH PERSEKUTUAN, THE COURT HELD THAT THE CHARGEE HAS A RIGHT TO
APEAL TO THE HIGH COURT UNDER SECTION 518 WHEN THE CHARGEE IS NOT
AWARE OF THE ENTRY OF REGISTRAR'S CAVEAT.
• HJ SALEH: BASICALLY, THE ONE WHO CAN REMOVE THE REGISTRAR'S CAVEAT
IS THE REGISTERED PROPRIETOR OTHER THAN OTHER AGGRIEVED PARTY
STATED IN SECTION 321 (3) AND SECT 418 OF NLC. THEREFORE, IN THE
PRESENT CASE, HJ SALEH WAS NOT A REGISTERED PROPRIETOR AS HE ONLY
PAID 50% OF THE PURCHASE PRICE. HE IS ONLY AN EQUITABLE OWNER OF
THE SAID LAND WHO DOESN’T HAVE A RIGHT TO REMOVE REGISTRAR'S
CAVEAT UNDER SECTION 321 (3) OF NLC.