PENGHAKIMAN

Elaine Yap Chin Gaik JC:

Introduction

[1] In this Originating Summons, the Plaintiff seeks a declaration that the private caveat under Presentation No 43/2022 ("Private Caveat") on Strata Title No Geran 234503 M1-B/5/327 at Subang Square ("Property") was lodged by the Defendant wrongfully and without reasonable cause, damages to be assessed under s 329 of the National Land Code 1965 ("NLC") and other ancillary relief.

[2] The Defendant is the Management Corporation of Subang Square and had lodged the Private Caveat on account of alleged unpaid management charges totalling RM61,546.15. It claims to have had a caveatable interest by reason of this debt, and further alleges that the Plaintiff suffered no loss by its entry because his claim of a cancelled sale of the Property is bogus.

Background Facts

[3] The Plaintiff purchased the Property on 14 July 1999 from the developer that developed Subang Square in a joint venture with the landowner Majlis Bandaraya Petaling Jaya ("MBPJ"). On 8 February 2022, the Plaintiff wrote to the MBPJ to effect the transfer of title of the Property to him. MBPJ signed and returned the transfer forms

[4] On 4 February 2022, the Defendant commenced a Housing and Strata Management Tribunal action against the Plaintiff to recover the sum RM61,546.15 allegedly due to the Defendant on the Property. The Plaintiff disputed the claim and on 11 May 2022, counterclaimed for re-connection of water supply to the Property and removal of the Private Caveat.

[5] The Private Caveat remained on the Property for over 18 months before the Defendant removed it on 21 August 2023. This was after the Plaintiff through his solicitors, paid the sum RM29,385.83 that was determined by the Housing and Strata Management Tribunal to be owed by the Plaintiff to the Defendant in a decision dated 15 February 2023.

[6] Meanwhile, the Plaintiff alleged that he had secured a purchaser for the Property on 13 April 2022 for RM1.6 million. He commenced this action because he claims that the purchaser, Lee Tow Cheng, pulled out of the sale after the discovery of the Private Caveat which existence was confirmed by a title search carried out on 14 April 2022.

[7] On 22 August 2024, the Plaintiff sold the Property to Akitek Akiprima Sdn Bhd for RM945,000.00.

Analysis And Findings

[8] Section 329(1) of the NLC reads as follows:

"(1) Any person or body who, wrongfully or without reasonable cause, secures the entry of, or fails to withdraw, any private caveat shall be liable to pay compensation to any person or body who thereby suffers any damage or loss"

[9] When the Originating Summons came up for hearing, the following issues were raised:

(a) Whether the Private Caveat entered by the Defendant was entered wrongfully or without reasonable cause

(b) Whether the Plaintiff had suffered damages or losses as a result of the lodgment of the Private Caveat

(c) Whether the Plaintiff has the locus standi to seek an injunction to restrain the Defendant from registering a new private caveat on the Property.

[10] In respect of the second issue above, the primary contention made by the Defendant is that no order for any assessment of damages should be made at all because the Plaintiff has not proved any loss caused by the Private Caveat.

[11] As a side note, I heard and dismissed the Defendant's application to strike out the Originating Summons or alternatively, to convert it to a Writ action on 17 October 2024. In that application, the Defendant asserted that the alleged transaction between the Plaintiff and Lee Tow Cheng was fake and that this Originating Summons should be struck out or tried as a Writ action.

[12] I held that the issues in the Originating Summons could be decided by affidavit evidence, with the mode of inquiry into damages to be determined. I made it clear then that assessment of damages may include liberty to cross-examine on the alleged transaction. This would allow for a just, expeditious and economical disposal of the proceedings.

Caveatabl