The court established that a caveat must be supported by a valid legal interest and timely action; failure to demonstrate either results in its removal.

Jamhirah Ali J:

Introduction

[1] Enclosure 1 is the Plaintiff's application made pursuant to ss 327, 329, and 417 of the National Land Code 1965 (NLC 1965) seeking an order to remove the private caveat lodged by the Defendant, Paul Monash a/l Narayanasamy, on 3 April 2024 over the property held under Geran 339999, Lot 126483, Mukim Dengkil, Daerah Sepang, Negeri Selangor (the Property).

[2] The Plaintiff's application was premised on the assertion that the Defendant has no caveatable interest in the Property, and that the continued presence of the caveat causes serious prejudice to the Plaintiff, who has fully performed her obligations under a valid sale and purchase transaction.

[3] Prior to the decision of this application, the Court had, via encl 6, dismissed the application by one Kavitah a/p Vathumalai to intervene in this proceeding in respect of the private caveat lodged by her on 10 July 2023.

Facts Of The Case

[4] The Property in question is held under Geran 339999, Lot 126483, Mukim Dengkil, Daerah Sepang, Negeri Selangor. On 11 April 2023, the Plaintiff, Vimala a/p Maruthamuthoo, entered into a Sale and Purchase Agreement (SPA) with the registered owners of the Property, namely:

(a) Kejendran a/l Nadarajan (Kejendran), who held 1/3 share,

(b) Mardai @ Ratha a/p Ponusamy, who held another 1/3 share in the Property, and

(c) The estate of the late Sargunan a/l Nadarajan (Sargunan), (represented by Kejendran as administrator of the deceased's estate), who also held a 1/3 share.

These individuals shall hereinafter be collectively referred to as "the Vendors"‌.

[5] The total purchase price under the SPA was RM550,000.00. The Plaintiff paid a deposit of RM55,000.00 upon execution of the SPA. Subsequently, the Plaintiff obtained end-financing from CIMB Islamic Bank Berhad, which settled the redemption sum of RM123,707.49 to the previous financier on 4 November 2023. The balance purchase price of RM371,292.51 was released to the Vendors' solicitors, Messrs Thana Krishnen & Co, on 21 December 2023.

[6] Prior to entering into the SPA, the Plaintiff conducted a land search on 28 March 2023, which revealed no encumbrances or caveats on the Property. Relying on this, she proceeded to sign the SPA in good faith. The Plaintiff also obtained the requisite developer's consent to the transfer vide letter dated 23 May 2023 issued by NCT United Development Sdn Bhd.

[7] However, on 3 April 2024 — nearly a year after the SPA — the Defendant lodged a private caveat on the Property, asserting rights under an earlier Sale and Purchase Agreement purportedly executed on 25 January 2012 (the Impugned Agreement) between him and the Vendors.

[8] The Plaintiff contended that the Defendant's claim was stale and unfounded. She filed the present application under s 327 of the NLC 1965 to remove the private caveat on the grounds that:

a. The Defendant had no caveatable interest in the Property;

b. There was an inordinate delay in lodging the caveat;

c. The Defendant had failed to take any steps to enforce the alleged Impugned Agreement or to initiate legal action against the Vendors; and

d. The presence of the caveat had caused her grave prejudice and injustice.

[9] The Defendant opposed the application. He claimed to have executed the Impugned Agreement with the Vendors on 25 January 2012 and that he had paid a deposit of RM100,000.00 and serviced monthly instalments on behalf of the Vendors to Citibank totalling RM93,405.00 between 2013 and 2023. He further argued that the Plaintiff's SPA had not been perfected due to an earlier caveat lodged by one Kavitah a/p Vathumalai on 10 July 2023, therefore, his own caveat was necessary to protect his interest.

[10] The Defendant also contended that the Plaintiff's SPA was defective due to a typographical error in the NRIC number of one of the Vendors, Kejendran, in the Letters of Administration pertaining to the estate of Sargunan. However, the Plaintiff submitted that the High Court in Kuala Lumpur had allowed a cor