Chin Fook Yen J:

This is an appeal by the 4th defendant from the decision of the Sr. Assist.Registrar (SAR) in allowing damages at RM205,600 consequent upon the removal of the defendants' caveat from the plaintiffs' pieces of land.

Briefly the facts are as follows. A company known as Chern Sing Furniture Sdn Bhd (company) was the registered proprietor of three pieces of land (the said lands). The 4th defendant was one of the directors, while the other defendants were the other directors in the company.On 26 December 1989 the DCB Bank Bhd, pursuant to a debenture executed by the company, appointed receivers and managers of the company.After the appointment, the receivers and managers on 23 August 1990, as vendors, entered into a sale and purchase agreement with the plaintiffs as purchasers over the said lands for the purchase price of RM2.57m.On knowing the sale, the defendants, including the 4th defendant, caused a caveat to be lodged against the said lands on 16 October 1990.The court subsequently ordered the removal of the caveat with damages to be assessed by the SAR and when so assessed be paid by the defendants to the plaintiffs.There was no appeal against the setting aside order.Accordingly the SAR proceeded with an enquiry to assess the damages suffered by the plaintiffs pursuant to s. 329 of the National Land Code (NLC).

At the enquiry held the plaintiffs produced evidence to prove the damages suffered.The evidence relevant to this discussion may be briefly stated below.It was common ground that the purchase price of RM2.57m was fully paid by plaintiffs on 23 August 1990, the caveat being lodged later on 16 October 1990.Subsequently on 26 November 1990 plaintiffs were approved a loan facility from the Malaysian French Bank Bhd (MFBB). According to plaintiffs, they needed the sum of RM2.57m from MFBB so as to plough back and use their working capital to carry on with their business.The plaintiffs also produced documentary evidence to show that they had existing contracts to supply goods to their customers.However, due to the presence of the caveat MFBB withdrew the said loan facility.The plaintiffs complained that as a result of MFBB's withdrawal they ran out of the working capital to buy supplies for onwards delivery to their customers.They stopped their supplies.Hence the loss of profits which they could have made, if they had been able to make use of the loan facility as the working capital.The SAR after having heard the evidence and the submissions on both sides assessed the damages at RM205,600.From the assessment of damages made by the SAR it would appear that the claim of damages presented by plaintiff fell into two headings.The first would be the amount of interest the plaintiffs would have earned on the amount of the loan of RM2.57m had it not being withdrawn and it was so assessed at RM205,600 and the second being the loss of profits which the plaintiffs would have made if their contracts had been performed.The SAR chose to make the award under the first head and rejected the other claims under the second.This appeal before me by the 4th defendant was against the assessment awarded of the amount of interest on the purchase price.It is pertinent to note there was no cross-appeal from the plaintiffs and as such the other claims of loss of profits are not in issue.

In this appeal the 4th defendant pointed out that the award of RM205,600 made by the SAR represented the amount of interest the plaintiffs would have earned on the amount of RM2.57m, being the purchase price, if the said sum was kept in fixed deposit at the rate of 8% per annum from July 1990 to July 1991.Counsel of the 4th defendant submitted that the award so made was misconceived in law, inter alia, on the ground that there was no evidence of actual damage suffered by the plaintiffs in consequence of the said caveat being lodged by the defendants.

The claim for damages was made under s. 329(1) NLC which reads:

(1) Any person or body who, w