JUDGMENT

Lamin Mohd. Yunus J:

The facts of this case are as follows. On or about 1 April 1985 the plaintiff bank accepted a charge over property held under HS(D) 4852 Lot 24401 Mukim Kuala Kuantan from the 1st defendant to secure a housing loan for RM92,000 with interest at the rate of 13. per annum. The said charge was presented for registration to the land office and accepted vide presentation number 1170/85. But on 23 May 1985 the charge together with issue document of title were returned to the plaintiff's solicitors as the official receipt for quit rent for the year 1985 was not supplied to the land office. When the documents were returned to the firm of solicitors, they were kept by the clerk of the firm one Miss Catherine Thong who did not bring them to the attention of the solicitors of the said firm. Only in early February 1986, after Miss Thong had left the firm it was discovered that the documents were all the time in her drawer and had not been re-presented. So on 7 February 1986 an attempt was made to once more register the charge. It could not be done as there was already a private caveat vide presentation number 567/85 lodged on 11 June 1985 by the 2nd defendant, Yahya Brickworks Sdn. Bhd.

In a separate action vide Kuantan High Court Civil Suit No. 180/85, Yahya Brickworks Sdn. Bhd., the 2nd defendant, sued the 1st defendant for goods sold and delivered and obtained judgment in default on 25 June 1985. Pursuant to the said judgment, the 2nd defendant had a writ of seizure and sale issued against the 1st defendant on 7 November 1985. On the same day a prohibitory order was filed and registered on 15 November 1985. On 1 July 1986 the 2nd defendant filed an application for a second prohibitory order and was granted by the Court on 4 September 1986 and issued on 19 September 1986. It was registered with the Pendaftar Hakmilik Negeri, Pahang on 2 October 1986.

The second writ of execution in respect of Kuantan High Court Civil Suit No. 180/85 was filed by the 2nd defendant on 24 February 1987. On the same day, he applied to the Court for a third prohibitory order and issued on 3 March 1987. It was registered with the Pendaftar Hakmilik Negeri, Pahang on 5 March 1987.

On 4 March 1987 the plaintiff lodged a private caveat which was registered vide caveat presentation number 114 of 1987, jilid 20, folio 31 and his grounds in support were that the 1st defendant had executed borang 16A (memorandum of charge) in respect of the said land on 1 April 1985 and the said borang 16A was presented for registration on 2 April 1985.

The said property was auctioned off on 6 March 1987 on the order of the abovementioned second writ of execution applied for by the 2nd defendant and purchased by the 3rd and 4th defendants. The full purchase price of RM85,200 was paid by the 3rd and 4th defendants to the Court on 5 June 1987.

The plaintiff in this case comes to this Court to seek the following reliefs as prayed for in encl. 5 namely:

(a) for a declaration that the plaintiff's charge in equity dated 1 April 1985 and the plaintiff's private caveat dated 4 March 1987 have priority of right claim and interest over that of the 2nd defendant's private caveat dated 11 June 1985 and his two prohibitory orders (dated 19 September 1986 and 3 March 1987) and that the plaintiff's said charge be duly registered, and

(b) the writ of seizure and sale issued in respect of the Kuantan High Court Civil Suit No. 180 of 1985 and all proceedings thereunder including the auction sale held on 6 March 1987 be set aside.

With regard to the first prayer I propose to examine the following decided cases as cited and the position of the law and its application.

In the case of Vallipuram Sivaguru v. V. Palaniappa Chetty, Official Administrator as Administrator of the Estate of Gan Inn, Deceased [1937] MLJ Rep. 55[1], the facts were that Gan Inn in January 1931 deposited his issue document of title with Palaniappa Chetty the first defendant/respondent as security for