LIFE PARADISE SDN BHD 1. EXPORT-IMPORT BANK OF MALAYSIA BERHAD 2. PENGARAH TANAH DAN GALIAN NEGERI SEMBILAN

LIFE PARADISE SDN BHD 1. EXPORT-IMPORT BANK OF MALAYSIA BERHAD 2. PENGARAH TANAH DAN GALIAN NEGERI SEMBILAN

Titles were deposited as security for a loan thereby satisfying the preconditions of sections 281 and 330 NLC entitling the respondent to enter lien-holder's caveats; proprietor's express consent was unnecessary where deposit demonstrated intention to secure a loan; section 17 of the Malay Reservations Enactment exempts entities in the Second Schedule (including respondent) so the prohibition in section 10 did not bar creation/registration of the lien and associated caveats; a void third-party charge did not negate the independent statutory lien; therefore the High Court decisions dismissing the appellant's challenge to the caveats and granting order for sale were correct.

Citation
1. N-01(NCVC)(A)-646-11/2019 & W-02(NCVC)(A)-2115-11/2019 (Mahkamah Rayuan)
Parties
Appellant / Plaintiff: Life Paradise Sdn Bhd; Respondent / Plaintiff: Export-Import Bank of Malaysia Berhad; Nominal Respondent: Pengarah Tanah Dan Galian Negeri Sembilan
Court
NCVC
Jurisdiction
Malaysia
Judgment Date
27 January 2021
Case Number
1. N-01(NCVC)(A)-646-11/2019 & W-02(NCVC)(A)-2115-11/2019 (Mahkamah Rayuan)
Procedural Posture
Civil Appeal (land/lien/caveat and Order for Sale) / Court of Appeal Judgment
Outcome
Both appeals dismissed
Legal Topics
Lien Holder's Caveat, Section 281 National Land Code, Malay Reservations Enactment Sections 10 and 17, Order for Sale Under Section 281, Third Party Charge, Statutory Lien
Source Language
Malay/English
Property Law Land Law Banking and Finance Civil Procedure Appeal Lien Holder's Caveat Section 281 National Land Code Malay Reservations Enactment Sections 10 and 17 +3 more

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Parties

Life Paradise Sdn Bhd

Appellant / Plaintiff

Export-Import Bank of Malaysia Berhad

Respondent / Plaintiff

Pengarah Tanah Dan Galian Negeri Sembilan

Nominal Respondent

Procedural Posture

Civil Appeal (land/lien/caveat and Order for Sale) / Court of Appeal Judgment

Legal Issues

  1. 1 Whether respondent had the right under section 281 and 330 of the National Land Code to enter lien-holder's caveats over titles deposited as security without express consent of proprietor
  2. 2 Whether section 10 of the Malay Reservations Enactment prohibits creation/registration of lien or caveat over Malay holding and whether section 17 provides an applicable exception
  3. 3 Whether a void third-party charge affects validity of a statutory lien and consequent order for sale

Ratio Decidendi

Titles were deposited as security for a loan thereby satisfying the preconditions of sections 281 and 330 NLC entitling the respondent to enter lien-holder's caveats; proprietor's express consent was unnecessary where deposit demonstrated intention to secure a loan; section 17 of the Malay Reservations Enactment exempts entities in the Second Schedule (including respondent) so the prohibition in section 10 did not bar creation/registration of the lien and associated caveats; a void third-party charge did not negate the independent statutory lien; therefore the High Court decisions dismissing the appellant's challenge to the caveats and granting order for sale were correct.

Court Disposition

Both appeals dismissed

Orders

  • Both appeals dismissed with costs of RM10,000 each in favour of the respondent, costs to be subject to payment of allocatur
  • Order for sale under section 281 of the National Land Code upheld