Howes J:

In this summons, the first defendant applies for an order that a caveat lodged by the plaintiff, and registered at his instance on the 22nd July, 1932, should be withdrawn, under Section 170 of the Land Code, 1926.

As a preliminary, I consider the procedure adopted, in issuing the summons in the course of the suit, was wrong; and that properly, the defendant should have issued an Originating Summons, as this application is made independently of the suit. However, rather than waste the time and money of the parties, in insisting on a fresh summons being taken out, I will deal with the application.

The facts of the case are as follows:

The two defendants on the 7th January, 1932, gave a promissory note for $840/ - in favour of one Yap Hong Khai and as collateral security, the first defendant deposited four extracts from the mukim register Nos 2585, 3297, 2440 and 3666 Chenderiang.

On the face of the promissory note these numbers are quoted as "being deposited as collateral security.

Yap Hong Khai did not present a caveat in respect of the above extracts under Section 166 of the Land Code, and therefore no "lien" over the land was ever created in his favour; but the extracts remained in his custody.

On the 11th July, 1932, Yap Hong Khai, by endorsement, transferred the promissory note to the present plaintiff, Ngan Khong, "absolutely." No mention was made of the collateral security, but the four extracts were deposited by him with the plaintiff.

Notice of the transfer of the promissory note to Ngan Khong was given to the defendants, and subsequently, they have paid interest to the present plaintiff amounting to $209.91.

Ngan Khong, on the 22nd July, 1932, presented a caveat in respect of the four extracts, which was duly registered. The first defendant now applies for an order that this caveat shall be withdrawn.

The defendants do not deny the rights of the plaintiff to payment under the promissory note, but Mr. Watson, for them, argues that as the original holder of the promissory note had no lien over the land, the plaintiff acquired no title to the land and that the registering authority was misled and should not have registered the caveat.

Mr. Watson contends that under Section 134 (i) of the Land Code the only person who can create a lien over land by presenting a caveat, is "the person with whom the same (i.e., the extract) has been deposited;" and only after registration of such caveat is the lien created.

He seeks to limit the right to present a caveat, to the original depositee of the titles. He does not deny that the titles were handed to the plaintiff by the original holder of the promissory note at the time of transfer.

He refers to the case of Palaniappa Chetty v. Dupire Brothers, 1 F.M.S.L.R. 370 in which the definition of "lien" in Halsbury's Laws of England Volume 19, p. 2 was quoted at p. 377 in the judgment of Whitley, JC:

`Lien' in its primary sense is the right in one man to retain that which is in his possession belonging to another until certain demands of the person in possession are satisfied.

Applying this definition to the present case, appellant had the right to retain grant No. 5138 until the loan in respect of which it was deposited was repaid. This right of retention is inconsistent with the exercise by the registered proprietor of his right to deal with the land. The registered proprietor therefore, has, for the purposes of the lien, surrendered that right. It follows, I think, that he has pledged the land as security for the loan, and has conferred upon the lien-holder a right analogous to that possessed by an equitable mortgage in countries where such mortgages are recognised.

Mr. Watson further quotes Halsbury Vol. 19, p. 3, where it is stated that a lien cannot be assigned. This, of course, is perfectly correct according to English law, under which, ordinarily, a lien is a right generally of a passive nature, to retain goods by a vendor or bailee for the price o