The principle of beneficial ownership dictates that the purchaser who fully pays the purchase price holds equitable rights over the property, preventing the seller from transferring the title to another party.

Anand Ponnudurai J:

Introduction

[1] This is a case involving a developer (1st Defendant) who appears to have sold two properties to the Plaintiffs in 2007 but thereafter sold the same properties to another purchaser ie the 2nd Defendant in 2014. With the said developer now being wound up, the result is the commencement of these proceedings and a dispute between the two purchasers whereby it is now incumbent on the Court to determine which of the two purchasers is the rightful owner of the said two properties.

[2] In this regard, a full trial was conducted and after hearing respective Counsel submissions thereafter, I had on 10 February 2023 allowed the Plaintiffs' claim against the Defendants and dismissed the 2nd Defendant's counterclaim. I will now provide the detailed reasons for my decision by first setting out the background facts, the evidence adduced, the respective parties' contentions and my analysis of the issues that have to be decided.

The Plaintiffs' Claim

[3] The Plaintiffs commenced these proceedings against the Defendants and seek the following reliefs:

(a) a declaration that the Plaintiffs are the beneficial owners of the properties held under Hakmilik Strata No Geran 71456/M3/1/623, Lot No 10131, Mukim 13, Daerah Timur Laut, Negeri Pulau Pinang known as No 14-01-13, Taman Alor Vista, Lebuh Relau, 11900 Bayan Lepas, Pulau Pinang and Hakmilik Strata No Geran 71456/M3/1/624, Lot No 10131, Mukim 13, Daerah Timur Laut, Negeri Pulau Pinang known as No 14-01-14, Taman Alor Vista, Lebuh Relau, 11900 Bayan Lepas, Pulau Pinang [collectively referred to as "the said two properties"];

(b) a declaration that the transfer of the whole part of the said two properties from the 1st Defendant to the 2nd Defendant be rendered null and void;

(c) the 2nd Defendant be required to transfer the said two properties to the Plaintiffs free from encumbrances by executing and serving the Memorandum of Transfer together with the relevant documents to the Plaintiffs within a month from the date of the judgment;

(d) in the event the 2nd Defendant breached paragraph (c) of the Order, the Registrar or other officer be authorised to execute the transfer documents under the name and for the 2nd Defendant for the purpose of transferring the said two properties to the Plaintiffs;

(e) the Land Administrator and/or any registration authority give effect to this Order and to the transfer of the said two properties pursuant to s 417 of the National Land Code 1965 ; and

(f) general damages.

The 2nd Defendant's Counterclaim

[4] The 2nd Defendant has mounted a counterclaim and seeks a declaration that the 2nd Defendant is the beneficial owner of the said two properties.

Salient Facts/Pleaded Cases

[5] The salient facts are largely undisputed and are as follows:

(a) on 1 October 2007, the Plaintiffs entered into two sale and purchase agreements with the 1st Defendant (who was the developer) for the purchase of the said two properties for a total purchase price of RM360,000.00. This is essentially two shop lots and has commonly been referred to at trial as Parcel Nos 13 and 14;

(b) the said sale and purchase agreements between the Plaintiffs and the 1st Defendant were signed by one Chew Kee Siew on behalf of the proprietor. Mr Chew testified as SP2. The same was signed by the Plaintiffs as the purchaser and by the late Dato' Tan Ewe Kwang @ Alex Tan on behalf of the 1st Defendant as vendor;

(c) it is the Plaintiffs' pleaded case that at the time of signing the said sale and purchase agreements, they were informed by the late Dato' Tan Ewe Kwang @ Alex Tan that the individual grant/ strata titles of the said two properties had yet to be issued/would be issued later and transferred to them subsequently;

(d) the P