JUDGMENT

Hishamudin Mohd Yunus JCA:

[1] This is an appeal from the decision of the learned judge of the High Court Kuala Lumpur (Civil Division) who, on 20 August 2008, vide two separate orders in an originating summons action before him for the removal of caveats pursuant to s. 327 of the National Land Code ('the NLC') :

(1) had allowed the plaintiff's (now the respondent before us) application to remove the caveats; and

(2) had dismissed the defendant's (now the appellant before us) application (via encl. 7 in the said originating summons, but heard together with the originating summons) for security for costs.

[2] We have allowed the appeal with costs. We now give the grounds of our decision.

[3] The material facts are not disputed. A company called City Centre Sdn. Bhd. ('CCSB') is the registered owner of several parcels of land in the District of Kuala Lumpur.

[4] The respondent/plaintiff was at one time the sole shareholder of CCSB. It owned 100% of the shares in CCSB. The respondent applied for and obtained a loan from a bank known as Overseas Union Bank ('OUB'). As a security for the loan, the plaintiff pledged all its shares in CCSB to OUB. The shares, having been pledged, were then registered in the name of a nominee for OUB known as OUB 2006 Nominees (Tempatan) Sdn Bhd ('OUB Nominees').

[5] Subsequently, on 25 April 2000, CCSB was wound up pursuant to a winding-up petition by a company known as T. R. Hamzah & Yeang Sdn Bhd. One Chuah Seong Phaik of Messrs Paul Chuah & Co was appointed liquidator for CCSB.

[6] On 9 January 2007, Chuah Seong Phaik, as liquidator and in the name of CCSB, entered into an agreement with the appellant/defendant. By this agreement, Chuah, as liquidator of CCSB, sold those parcels of land belonging to CCSB to the defendant. Pursuant to the sale and purchase agreement, the defendant paid RM7.9 million to the stakeholders jointly appointed by the liquidator and the defendant. As a follow-up action to this sale transaction, the defendant, as purchaser, lodged caveats on the titles of CCSB's lands. These caveats are registered as:

(a) Presentation No: 311/2007; and

(b) Presentation No: 397/2007.

[7] On 4 April 2008, the respondent (United Securities Sdn Bhd) filed an originating summons at the High Court of Kuala Lumpur against the appellant (North Plaza Sdn Bhd) applying to remove the caveats. The main reason given by the respondent for making the application is that the appellant did not have a caveatable interest over the parcels of land.

[8] The respondent succeeded in their originating summons application to have the caveats removed; and, hence, the present appeal by the appellant.

[9] Now, it is pertinent to note that prior to the filing of the originating summons on 4 April 2008, the respondent/plaintiff had been wound up by an order of the High Court of Kuala Lumpur dated 30 January 2007, pursuant to the presentation of a winding-up petition by a company called Equiticorp Holdings Ltd. The Official Receiver was appointed as the liquidator. The respondent appeal to the Court of Appeal against the winding up order, and pending the disposal of the appeal the respondent was granted by the Court of Appeal an interim stay of the winding up order. The respondent's originating summons was filed while the interim stay order was still in force. However, on 6 May 2008 the appeal was dismissed by the Court of Appeal.

[10] At this juncture, we pause to make the following remark. We observe that, even after their appeal had been dismissed by the Court of Appeal, the respondent still proceeded with the originating summons proceeding before the High Court and subsequently obtained an order in their favour on 20 August 2008. This is highly irregular. Strictly, after the dismissal of their appeal by the Court of Appeal, the respondent no longer has any locus to proceed with their originating summons since the winding up order is now confirmed and the interim stay order automatically ended. After the dismissal of the ap