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1996 MarsdenLR 2038

CHONG SIEW FAI,PEH SWEE CHIN,WAN ADNAN
FEDERAL COURT (ALOR SETAR)
KHO AH SOON - Appellant
Versus
DUNIAGA SDN BHD - Respondents

CIVIL APPEAL NO 02-475-91
Decided On : 02/10/1996

Advocates:
Maikal Yasu & Murali (Anwar & Maikal) for the appellant.
VM Mohan & Cheong Ying Wei (JB Lim Suhaimi & Khaw) for the respondent.
APPFROM: Originating Summons No 25-46-90 (CT 1)(High Court, Pulau Pinang)
Maikal Yasu & Murali (Anwar & Maikal) for the appellant.
VM Mohan & Cheong Ying Wei (JB Lim Suhaimi & Khaw) for the respondent.

JUDGMENTBY: PEH SWEE CHIN FCJ (DELIVERING THE JUDGMENT OF THE COURT)

This is an appeal by the defendant Kho Ah Soon, against an order dated 28 October 1991 of the Penang High Court ordering the removal of a private caveat No 5853/89, Jilid 207, Folio 56 dated 3 November 1989 lodged by the defendant against certain lands described therein, the said order having been made in pursuance of a notice of motion No 25-46-1990 dated 9 July 1990.

The order appealed from has never been extracted and in the said notice of motion, the plaintiff had asked for, in addition to the removal of the said private caveat, another order for the setting aside of yet some other order made in some other originating summons, ie the Originating Summons No 24-55-1990.

The prayer for setting aside that other order was not mentioned at all in the relevant notes of proceedings (pp 63-65 of the appeal record), and from the said notes, the court below merely made an order to the effect that the said private caveat be removed (p 64) that the caveator do pay compensation to be assessed by the senior assistant registrar (p 65), and that leave to appeal be granted (p 65). We will, therefore, confine ourselves to dealing solely with the order of removal of the private caveat aforesaid (the plaintiff in this notice of motion is hereinafter called the caveatee and the defendant, the caveator).

It is common ground that the said private caveat is connected with a pending civil suit, being Penang High Court Civil Suit No 22-28-1990 in which, briefly, the caveator is the plaintiff and the caveatee, the first defendant; and in which the caveator has sued for specific performance of an alleged agreement with the caveatee for the latter to sell and the caveator to buy the lands against which the private caveat herein was lodged in the forst place. The second defendant in that civil suit is alleged to be an option holder for the sale of the said lands in respect of such an option from the caveatee while the third defendant is alleged to be a party in conspiracy with the other co-defendants to defraud and injure the plaintiff.

It is settled that in a matter of removal of a caveat as between a caveator and caveatee, as in the instant appeal, the onus is on the caveator to satisfy the court that his evidence does raise a serious question to be tried as regards his claim to an interest in the land in question, and having done his claim so he must show that, on a balance of convenience, it would be better to maintain the status quo until the trial of the action by preventing the caveatee from disposing of his land, as laid down by Lord Diplock in Eng Mee Yong & Ors v V Letchumanan [1979] 2 MLJ 212 , and by analogy indirectly to American Cyanamid Co v Ethicon [1975] AC 396 as indicated by Lord Diplock, the serious question for trial referred to above could mean a question not being vexatious or frivolous.

The court below did bear in mind correctly the case of Eng Mee Yong but had ordered the removal of the said private caveat because, to quote:

... when ordering the removal of the caveat, I had thought that the

option, being unsupported by consideration, was unenforceable (see s

2(d) of the Contracts Act 1950).

In the grounds of judgment of the court below, the said court stated that it recognized that the said option could still be good as an offer and that such an offer, if accepted before its revocation, could give rise to a contract, citing Goldsbrough Mort & Co Ltd v Quinn(1910) 10 CLR 674 at p 691.

The caveatee had given the option to the second defendant, one Tan in the above-mentioned civil suit (hereinafter called Tan), ie an option to sell the said lands for RM410,000 and allegedly the caveator had exercised his option to buy the said lands at RM580,000 by a letter allegedly sent in the nick of time and dated 26 September 1989 through his solicitor to the caveatee who was alleged to have duly acknowledged receipt of it. The caveator alleged that

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