Gopal Sri Ram JCA:

This appeal, directed against the order of the High Court at Penang, refusing the appellant's application to remove the respondent's caveat raises a short but important point. The brief facts relevant to the appeal are as follows.

The appellant is the registered proprietor of all those lands held under Lots 3440 and 3441, Mukim 13, Daerah Timor Laut, Penang ('the subject land'). On 25 July 1989, the appellant, as vendor, entered into a written agreement of sale with the respondent under the terms of which the former agreed to sell to the latter the subject land and one other lot at a price of RM26,000 per acre. The agreement did not stipulate the date on which completion was to take place. The sale and purchase of the third lot was completed and it does not form the subject matter of the present litigation. On 20 August 1989 the respondent entered a private caveat against the registered document of titles to the subject land.

By a letter dated 9 November 1994, the appellant's solicitors gave the respondent notice to complete the sale and purchase of the subject lands within three months, that is to say, not later than 8 February 1995. The reply to the appellant's letter did not come until 7 February 1995 when the respondent's solicitors wrote to say that their client intended to effect completion by making payment of the full purchase price within four months from the date of the letter. On 20 February 1995, the appellant wrote through its solicitors stating that it did not agree to the respondent's proposal. This letter also called upon the respondent to remove its caveat. The respondent did not, however, remove the caveat. Neither did it commence any proceedings for the specific enforcement of the sale and purchase agreement in question.

Thereafter the appellant took out an originating motion on 29 March 1995 seeking an order for the removal of the respondent's caveat. The learned judge who heard the application, after a careful analysis of the evidence placed before him, refused it principally on the ground that there were serious questions to be tried. Having so held, he did not, however, go on to consider whether the balance of justice lay in favour of the caveat remaining on the register or whether it favoured the removal of the restraint. In particular, it does not appear from his judgment that he took into account the absence of any steps taken by the respondent to enforce its contractual rights. All he said was that the status quo ought to be proceeded until the matter is tried. However, he does not appear to have appreciated, sufficiently or at all, that there was no "matter to be tried" because no action had been commenced by the respondent.

Before us, counsel for the appellant properly conceded that there was a caveatable interest and that the matters put in issue during the caveat proceedings did raise serious questions to be tried. She however argued that the learned judge had erred in failing to consider the balance of convenience. She submitted that the caveat could not be permitted to remain on the register because the respondent had not timeously commenced proceedings for specific relief. Counsel also drew our attention to the fact that no action had been instituted even as at the date of hearing of this appeal.

We are of the view that there is merit in these arguments and that they are supported by authority. In Eng Mee Yong & Ors. V. Letchumanan [1979] Lord Diplock said:

In the case of a refusal by the vendor to complete a contract for the sale of land the normal remedy of the purchaser as plaintiff in an action is an order for specific performance of the contract; and in the absence of special circumstances, if it were shown that the vendor threatened to dispose of the land while the action was still pending, the balance of convenience would be in favour of granting an interlocutory injunction to prevent his doing so, provided that the plaintiff would be in a position to s