Howes J:

In this application, the Official Receiver, Federated Malay States, applies for an order giving the directions of the Court under Section 179 (iii) of the Companies Enactment, 1917, on the following matters:

(a) Upon the liquidation of the above Company was Bun Tin Lum Company, Limited, entitled to enforce in or through the Courts of the Federated Malay States an equitable charge against the Pratanabats of the above Company or the rights and benefits thereof?

(b) Should the proceeds of sale of the property of the above company including the said Pratanabats be applied towards satisfaction of the claim of Thomas James McGregor under the Debenture of the 22nd day of June, 1928, or be applied in satisfaction of the claims of the creditors generally?

The facts are set out in the affidavit of Mr. JDM Smith, the Official Receiver sworn the 21st April, 1934. Shortly, they are as follows:

Huey Yet Tin Dredging Ltd., (the debtor-company) went into liquidation in 1930. One of the creditors of the debtor-company was Bun Tin Lum Co., Ltd.

On the 22nd June, 1928, the debtor-company in consideration of $109,556/- gave a debenture by way of first charge on all its property and assets, and by an agreement made on the same day the debtor-company agreed upon demand by the lender, (i.e. the Bun Tin Lum Co., Ltd.), to charge the mining lands mentioned in the first schedule by way of registered charge in favour of the lender.

On the 11th December, 1931, Bun Tin Lum Co., Ltd., assigned to Mr. TJ McGregor all debts due to it by the Official Receiver and Liquidator of the debtor-company, and the full benefit of its interests and title to the same.

It is agreed that Mr. McGregor stands in the shoes of Bun Tin Lum Ltd.

Mr. McGregor claims to be a creditor for $194,723.31, and also to be a secured creditor for a sum of $121,406.30 of this amount by virtue of the debenture. This sum includes interest payable under the debenture down to 26th August, 1930.

The debtor-company possessed certain 'Pratanabats,' or mining rights in Siam which Mr. McGregor claims to have been included in the charge. According to section 3 (v) of the Siam Mining Act, 1919,

Pratanabat means an agreement which the Royal Department of Mines shall have made with any person in accordance with this Act conferring on the holder the right to carry on mining work within the area specified in the document.

Section 45 of the same Act deals with the transfer, by the holder, of a pratanabat to others and lays down the procedure to be followed.

Section 47 is the all-important section in this matter, and reads -

No mortgage or charge of any kind on a pratanabat shall be valid unless previously sanctioned by the Royal Department of Mines. No holder shall be allowed to use his pratanabat in whole or partial liquidation of a debt, nor shall a pratanabat be attachable in respect of such debt.

Section 51 reads:

A pratanabat does not convey to the holder any rights of ownership in the land comprised in such pratanabat. The rights conferred on the holder are to be only as follows:

(i) The holder has the right to mine, treat and sell such mineral or minerals as are specified in the Pratanabat. Should the holder wish to mine any mineral not so specified he shall first obtain special permission to do so from the Minister.

(ii) The holder may take such vacant land within his Mining Area for the purpose of erecting buildings and planting such vegetables and keeping such animals as may be necessary for the work of the mines and the support of his workmen, after having obtained permission in writing at the District Mines Office.

It is somewhat difficult to say exactly to what, in English Law, a pratanabat corresponds. It does not convey any rights of ownership in the land comprised in the Pratanabat, but gives the holder the right to mine, treat and sell minerals specified therein. This appears to me, in English law, to amount to a profit a prendre in gross,- and, as such