JUDGMENT

Aziah Ali J:

[1] On 23 June 2006 the plaintiff filed an originating summons for an order for sale of three parcels of land known as H.S (D) 5460 P.T No 9135, H.S (D) 5472 P.T No. 9147 and H.S (D) 5473 P.T No 9148, all in Mukim Ijok, Kuala Selangor, by way of auction under ss. 256 and 257 National Land Code 1965 to recover sums due under a facilities agreement. On 29 May 2007, the order for sale was granted. The defendants then filed an appeal to the Court of Appeal against the said order. Pursuant to the appeal the defendants filed an application vide encl. 18 for a stay of all proceedings pending the disposal of their appeal. I had allowed the defendants' application and the plaintiff now appeals against this decision.

[2] In support of the defendants' application, learned counsel for the defendants submitted that the defendants have established special circumstances to justify the grant of a stay. Counsel referred to the case of Kosma Palm Oil Mill Sdn Bhd & Ors v. Koperasi Serbausaha Makmur Bhd, [2004] 1 MLJ 257 where Augustine Paul JCA (as he then was) in delivering the decision of the Court had said inter alia as follows:

The general rule is that an appeal shall not operate as a stay of execution unless the Court so orders. Accordingly, as Brown J said in Serangoon Garden Estate Ltd v. Ang Keng while commenting on the discretion to grant a stay:

But it is a clear principle that the Court will not deprive a successful party of the fruits of his litigation until an appeal is determined, unless the unsuccessful party can show special circumstances to justify it.

The need to prove special circumstances before a stay of execution can be granted is English common law that has been adopted in this country.

It is therefore clear beyond doubt that there are many factors that may constitute special circumstances and the fact that an appeal would be rendered nugatory if stay was refused is the most common one. It is an example of special circumstances. In other words special circumstances is the genus of which nugatoriness is a species. If it has been shown that an appeal would be rendered nugatory if stay was refused what it means is that a special circumstance has been established. Thus they cannot be treated as separate heads and one cannot be an alternative to the other. Neither can one be accepted or rejected in favour of the other as they are inter-related.

The onus is on the applicants to demonstrate the existence of special circumstances to justify the grant of a stay of execution. The reasons must relate to the enforcement of the judgment. They must be deposed in the affidavit filed in support of the application.

[3] In the case of Institut Teknologi Federal Sdn Bhd v. IIUM Education Sdn Bhd, [2005] 3 MLJ 221 , Abdul Malik b Ishak, J (as he then was) said as follows:

Kosma Palm Oil was a decision of the Federal Court. It has resolved the conflicting line of authorities preceding it. It confirms the test of "special circumstances" and it states that the "nugatoriness" of an appeal is a species of the "special circumstances" test and not a separate test by itself. So, if the defendant here was able to show that a refusal of the stay would render any further successful appeal nugatory, this would certainly constitute "special circumstances".

His Lordship said further:

In RHB Sakura Merchant Bankers Bhd v. Tan Sri Dato' Ting Pek Khiing (No: 2) supra , I had this to say:

The emphasis of the nugatory test for determining the stay is not that the appeal would be successful. Rather, a stay is to be granted only if it can be shown that the appeal would be rendered nugatory if it would deprive the defendant of the result of the appeal (Mohamed Mustafa v. Kandasami (No: 2) , [1979] 2 MLJ 126).

[4] Learned counsel submitted that if stay is not granted and the plaintiff proceeds with the sale of these three parcels of land before their appeal is heard then it will be impossible for the defendants to recover the three parcels of land a