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2007 MarsdenLR 32
COURT OF APPEAL PUTRAJAYA
PEOPLE REALTY SDN BHD – Appellant
Versus
HONG LEONG BANK BHD & ANOR – Respondent
[Civil Appeal No: B-02-517-2006]
[1] This is an appeal by the appellant against two decisions of the learned Judicial Commissioner Shah Alam, made on 21 April 2006, namely:-
(a) dismissal of the appellant's application to set aside the auction sale dated 12 May 2003 (1st decision); and
(b) dismissal of the appellant's appeal to the judge in Chambers on the reserve price fixed by the Senior Assistant Registrar on 2 December 2002 (2nd decision).
[2] On 20 June 2007 we heard and dismissed the appeal. We now give our reasons. First, the relevant facts.
[3] On 19 October 1995 the appellant executed a National Land Code charge ("the charge") in favour of the Hong Leong Bank Bhd ("1st Respondent"). The charge was created over two lots of land owned by the appellant namely LotNo: s: 5808 and 5809, CTNo: s: 20462 and 20463, Mukim Petaling, Daerah Kuala Lumpur ("the said land"). The charge was to secure the repayment of banking facilities granted by the 1st Respondent to the appellant.
[4] On 26 March 1999 the 1st Respondent filed an Originating Summons in Shah Alam High Court, applying inter alia for an order for sale of the said land. An order for sale of the said land was granted by the High Court on 29 June 2001. Pursuant to the Summon For Directions dated 15 April 2002 filed by the 1st Respondent, the Senior Assistant Registrar (SAR) issued an order directing that the sale of the said land is to be by way of public auction and fixed the reserve price at RM6.2 million.
[5] The 2nd Respondent attended the auction sale at Shah Alam High Court on 12 May 2003 and succeeded in bidding the said land at the reserve price of RM6.2 million. A deposit of RM620,000 was paid. The balance of purchase price was settled on 7 August 2003, within the time limit fixed.
[6] On 19 February 2003 a certificate of sale (Form 16F of National Land Code) was issued by the Shah Alam High Court. However, the said certificate of sale could not be presented for registration at the office of Registrar of Titles, Selangor, as the appellant has entered a private caveat on the said land. The 2nd Respondent applied to remove the said private caveat and this was allowed by the Shah Alam High Court on 21 June 2004. Pursuant thereto, the said land was duly registered in the name of the 2nd Respondent as the registered owner The 2nd Respondent has since then commenced their respective works to develop the said land inter alia as a housing project.
[7] The main complaint by the appellant in this appeal is the reliance by the SAR on the valuation report dated 20 September 2001 tendered by the 1st Respondent, as the basis of fixing the reserve price for the said land. According to the appellant, the valuation report contains serious and unacceptable inconsistencies and should not have been accepted by the SAR. Thus, it is contended by the appellant that the sale was not done at a fair market value.
[8] With utmost respect, we are unable to subscribe the appellant's argument. To us, since the appellant is challenging the valuation of the said land, it is necessary for the appellant to submit its own valuation report to counter the valuation report tendered by the 1st Respondent. However, in this case, the appellant has not produced any valuation report to show that the market value of the said land was more than RM6.2 million. In Bank Kerjasama Rakyat Malaysia v. Daya Plaza Sdn Bhd, Empire Possession Sdn Bhd (Intervener), [1998] 5 CLJ 79 Arifin Zakaria, J (now Federal Court Judge) held at p 85 that:-
What is even more fatal to the defendant's case is that even assuming for the sake of argument that there was a breach of duty of care by the plaintiff in the conduct of the auction of the said lands, the burden is on the defendant to prove that the defendant has suffered damage as the result thereof. This means to say that the defendant has to satisfy the Court, on the balance of probabilities the said land has been sold at a price below the market value. Since the issue involves the valuation
