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2021 MarsdenLR 3563
HIGH COURT MALAYA KUALA LUMPUR
CHIN HON FAH – Appellant
Versus
PROPERTY TRACKERS SDN BHD – Respondent
[Originating Summons No: WA-24NCVC-754-06-2020]
The court ruled that a private caveat should be lifted when the caveator fails to maintain a caveatable interest after breaching the Sale and Purchase Agreement.
Headnote:(A) National Land Code – Sections 206 and 323 – The Applicant sought to lift the private caveat lodged by the Respondent. The Respondent failed to complete the purchase of properties under the Sale and Purchase Agreement and has since been wound up. The Applicant is entitled to remove the caveat but must refund the sum of RM2,120,457.00 as per the contract terms. (Paras 9, 15, 29)
(B) Liquidated Damages – The Applicant is limited to claim liquidated damages of RM330,000.00 as agreed. (Paras 20, 29)
(C) Nature of Caveat – The court considered whether the Respondent had a caveatable interest in the land and ruled no serious issues remain for trial given the breach of contract. (Paras 15, 29)
Facts of the case: The Respondent entered a Sale and Purchase Agreement with the Applicant for properties valued at RM8,500,000.00 but failed to pay the full purchase price, leading to winding up and the Applicant seeking to lift the caveat.
Findings of Court: The caveat will be lifted, and the Applicant must refund the difference in payments made by the Respondent.
Issues: The court addressed whether the Respondent had an ongoing caveatable interest and the nature of the liquidated damages for non-completion.
Ratio Decidendi: The court found the private caveat should be lifted; the Respondent breached the agreement, leading to no further caveatable interest.
Result: Orders granted as sought by the Applicant.
JUDGMENT
Non-Disputed Facts
[1] The Applicant, Chin Hon Fah, is seeking, inter alia, an order to lift the private caveat entered on the property known as PN 31293, Lot 11835, PN 31294 and PN 31295, Lot 11836 in the Mukim of Ampang, Daerah Kuala Lumpur.
[2] The private caveat was entered by the Respondent, Property Tracker Sdn Bhd, a company incorporated in Malaysia under the Companies Act.
[3] The private caveat was lodged by the Respondent according to the terms of the Sale and Purchase Agreement dated 5 August 2016 ("Agreement").
[4] The material terms of the Agreement are as follows:-
2 AGREEMENT OF SALE.
2.1 Subject to the fulfilment of the Conditions Precedent and subject further to simultaneous completion of the Share Sale Agreement, the Vendor hereby agrees to sell and the Purchaser hereby agrees to purchase the Said Properties together with the Fittings therein on "as is where is" basis and subject to the Tenancies for the purchase price of Ringgit Malaysia Eight Millions and Five Hundred Thousand (RM8,500,000.00) only ("Purchase Price") with legal possession and free from encumbrances upon the terms and conditions hereinafter contained.
For the avoidance of doubt:
(a) In the event of expiry or early termination of the Tenancies before the Completion Date, the Vendor shall not be responsible to procure a replacement tenant for such part of the Properties, unless the early termination is due to the Vendor's breech of the respective Tenancy Agreement.
(b) In the event of expiry or early termination of any of the Tenancies not due to the Vendor's breech of the respective Tenancy Agreements and the Vendor does not procure a replacement tenant, the Vendor shall deliver vacant possession of such tenanted part of the Properties to the Purchaser, For the avoidance of doubt, vacant possession shall mean free of occupiers(s), personal belongings and movable assets unless otherwise agreed by the Purchaser. Notwithstanding anything stated in cl 34.1 hereof, if there is any renovation work abandoned by the tenant, the Vendor shall transfer the security deposit under the said tenancy agreement to the Purchaser.
(c) In the event the Vendor shall renew any of the Tenancies or procure any replacement tenant, the Vendor shall procure the Purchaser's prior written consent.
(d) The Vendor shall not be responsible to replace any of the Fittings that is/are damaged by normal wear and tear.
And clause 3.1 states that;
3 PURCHASE PRICE AND TERMS OF PAYMENT
3.1 The Purchase Price shall be paid by the Purchaser in the following manner:
3.1.1 a sum of Ringgit Malaysia one Hundred Thousand and Ten Thousand (RM 110,000.00) only being earnest deposit (Earnest deposit) (Exclusive GST) has been paid by the Purchaser to the Vendor prior to the execution of this agreement, the receipt of which is hereby expressly acknowledge by the Vendor;
3.1.2 a sum of Ringgit Malaysia three hundred and seventy thousand (RM370 000.00) only being the partial deposit ("Partial Deposit") (exclusive GST) shall be paid by the purchaser to the Vendor upon the execution of this Agreement, the receipt of which is hereby expressly acknowledged by the Vendor;
3.1.3 A sum if Ringgit Malaysia Three hundred and Seventy Thousand (RM370,000.00) only being the balance deposit ("Balance Deposit") (exclusive of GST) shall be paid by the Purchaser to the Vendor upon the Unconditional Date; and
The earnest Deposit, the Partial Deposit and Balance Deposit shall hereinafter collectively be referred to as "the Deposit".
3.1.4 a sum of Ringgit Malaysia Seven Million Six Hundred and Fifty Thousand (RM7,650,000.00) only ("Balance Sum") (exclusive of GST) shall be paid by the Purchaser of the Vendor's Solicitors as stakeholder within three (3) months from the Unconditional Date ("Completion Period"). For the avoidance of doubt, in the event that the Purchaser is taking a Loan, the difference between the Balance Sum and the Loan ("Differential Sum") may be paid by the Purchaser directly
