JUDGMENT

Sulong Matjeraie JCA:

[1] This is the judgment of the Court.

[2] This is an appeal against the decision of the learned High Court Judge at Sibu, Sarawak who had dismissed, with costs, the originating summons of the appellant/plaintiff (appellant) for an order for the removal of caveat under s. 177 of the Sarawak Land Code (Cap. 81). We agreed with and affirmed the decision of the learned High Court Judge and have accordingly dismissed the appeal. Our reasons are as follows.

Brief Facts

[3] The appellant, being the registered proprietor of all that parcel of land situate at Sungai Seduan, Sibu, containing an area of 22.983 hectares, more or less and described as Lot 1382 Block 11, Seduan Land District ('the said land'), entered into a development agreement ('development agreement') with the respondent/defendant ('respondent') on 9 May 1998 for the development of the said land. The respondent was formerly known as Vicspeed Sdn Bhd.

[4] It was envisaged under the development agreement that residential and commercial buildings will be constructed on various subdivided sublots thereon.

[5] The development agreement confers, on a sharing basis, the appellant with 20% of the residential and commercial buildings approved by the authorities while the respondent shall retain the remaining 80% of the said buildings.

[6] Clause 17(1) of the development agreement confers the right of the respondent to lodge a caveat against the said land. Accordingly, the respondent lodged a caveat at the Sibu Land Registry Office on 23 June 1998 vide Instrument No. L6318/1998 ('the caveat').

[7] Disputes arose between the parties hereto culminating in the termination of the development agreement and resulting in the respondent taking writ action ('writ action') for specific performance against the appellant. The said writ action is still pending before the High Court in Sibu, Sarawak.

Issue Before This Court

[8] Whether the development agreement confers onto the respondent beneficial interest in the said land to sustain the caveat?

Decision Of Learned High Court Judge

[9] The learned High Court Judge was satisfied that the respondent had successfully established a serious question to be tried and concluded that the balance of convenience laid in maintaining status quo to prevent, inter alia , scuttling the prospect of the respondent's pending writ action for specific performance.

Appellant's Contention

[10] Learned counsel for the appellant argued that since the development agreement has been terminated the respondent ceased to have any more beneficial interest over the land to sustain the caveat.

[11] He argued that the development agreement stipulates that the respondent shall apply for and obtain approval in principle in writing for the subdivision of the said land within a period of twenty-four (24) months from the date of the agreement which was 9 May 1998. Therefore such approval in principle should have been obtained by 9 May 2000.

[12] It was further argued that in the event that approval cannot be obtained within the stipulated 24-month period, then the development agreement, the Power of Attorney shall ipso facto lapse and be determined. The caveat shall also be withdrawn by the respondent at its own costs.

[13] Learned counsel for the appellant alleged that no such approval was forthcoming within the 24 months period. He conceded however that there was a letter dated 5 May 2000 from Jabatan Tanah dan Ukur, Bahagian Sibu, Sarawak (Lands & Surveys Department, Sibu, Sarawak) at p. 178 of the record of appeal but contended that approval was never obtained. It was a mere invitation to treat.

[14] This Court notes however that the said letter seems to offer provisional approval for a period of three (3) months subject to payment of specified fees.

[15] It was also the contention of learned counsel for the appellant that this was a contractual interest provided for under the development agreement. He argued that once the respondent cannot perform and comply with