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2022 MarsdenLR 626
HIGH COURT MALAYA SHAH ALAM
PUBLIC ISLAMIC BANK BERHAD – Appellant
Versus
FADHIL HUSSEIIN ISHAK YASSIN MANSOR; MS CITAJAYA SDN BHD (PROPOSED INT.... – Respondent
[Originating Summons Nos: BA-24MFC-473-12-2017 & Application For Execution No: BA-38-399-04-2018]
Courts have inherent powers to suspend time constraints during extraordinary circumstances like a pandemic to ensure justice for bona fide purchasers.
Headnote:(A) National Land Code (NLC) 1965 – Section 257(1)(g) – Inherent powers of the Court – This appeal concerns the discretion under inherent powers to suspend time due to total lockdown during the Covid-19 pandemic. The Court exercised its discretion to exclude 28 days from the calculation of the 120 days specified in s 257(1)(g) of the NLC due to pandemic-related disruptions. (Paras 10, 29, 31)
Facts of the case: The Plaintiff sought a foreclosure order, and after the auction of the property, the complete payment was due within 120 days. The purchaser could not meet this due to the pandemic, which led to their application for an extension. The Plaintiff did not object to this application but the Deputy Registrar's decision to grant the extension was appealed. (Paras 3-12)
Findings of Court: The Appellant's appeal was dismissed based on the need to ensure equity and justice considering the unprecedented pandemic circumstances affecting all parties involved. (Paras 14-35)
Issues: Whether the inherent powers of the Court can allow for the suspension of time during a total lockdown. (Para 2)
Ratio Decidendi: The court ruled it had the inherent power to address delays caused by extraordinary circumstances such as a pandemic, providing justice to a bona fide purchaser. (Paras 29, 31)
Result: Appeal dismissed with costs of RM5,000.00. (Paras 35)
JUDGMENT
Introduction
[1] This is an appeal by the Appellant/Defendant against the decision of the Deputy the Intervener/purchaser's application for an extension of time to pay the balance purchase price within 120 days from the date of the sale pursuant to s 257(1)(g) of the National Land Code ( NLC ).
[2] The only issue in this appeal is whether the Court has the discretion under the inherent powers to allow suspension of time during the total lockdown period announced by the Government and therefore, the 28 days during the total lockdown from 1 June 2021 till 28 June 2021 should be excluded in the computation of the 120 days stated in s 257(1)(g) of the NLC .
Brief Facts
[3] Pursuant to the Plaintiff's action for a foreclosure order in suit BA-24 MFC- 473-12/2017 in the High Court at Shah Alam, the Plaintiff obtained an Order for Sale on 20 February 2018 against the property charged by the Defendant. There was no appeal against the said order by the Defendant.
[4] Subsequently, the Plaintiff applied to the execution division of High Court Shah Alam to fix an auction date and reserve price to foreclose the charged property. The first auction date was fixed on 9 July 2018 with an initial reserve price of RM3,200,000.00. However, the first auction was unsuccessful and thereafter the Plaintiff then filed several applications to fix a new auction date and the reserve price for the subsequent auctions.
[5] Eventually, the Property was successfully auctioned on 5 April 2021 and the Proposed Intervener, MS Citajaya Sdn Bhd (MS Citajaya) was the successful bidder at the said auction at the price of RM1,600,000.00. MS Citajaya paid a deposit sum of RM160,000.00 and the completion date to settle the balance purchase price was on 3 August 2021 ie one hundred and twenty (120) days from the auction date pursuant to s 257(1)(g) of the NLC .
[6] MS Citajaya applied for a banking loan facility for the amount of RM965,100.00 including Business Financing Term Takaful (the Facility) from Public Islamic Bank Berhad Kuala Terengganu Branch, to finance the said purchase. On 16 July 2021 MS Citajaya paid the differential sum of RM480,000.00 to the Plaintiff's solicitors.
[7] However, MS Citajaya was unable to settle the balance purchase price by 3 August 2021 for the following reasons:
a. the implementation of the Movement Control Order (MCO) by the Government of Malaysia under s 11 of the Prevention and Control of Infectious Diseases Act 1988 which commenced on 1 June 2021 and continued with the Restriction Movement Control Order (RMCO) commencing from 3 July 2021 (the said Control Orders).
b. due to the said Control Orders, the banking sector had shortened its operating hours to 2.00 pm with only 60% of its employees allowed to be present physically at the bank premises, which had caused the delay in approving the loan facility and the issuance of the Letter of Offer to MS Citajaya.
c. due to the said Control Orders the law firms were not allowed to operate and subsequently, were only allowed to operate on 27 June 2021 with the condition that the legal firm must first obtain permission from MITI. The closure for 27 days resulted in a delay in the process of completing the loan documentation between MS Citajaya and its financier.
d. closure of Public Islamic Bank Kuala Terengganu branch premises for 10 days due to Covid-19 infection resulted in the delay in execution of loan documentation and Form 19B by MS Citajaya's financier thus causing a delay in presenting the private caveat documentation on behalf of the financier at the PTG Selangor.
e. The PTG Selangor was also closed and was only allowed to operate again on 21 July 2021 with only 20% of its employees allowed to be present physically at the PTG office, which caused the delay in the presentation of the private caveat by MS Citajaya's solicitors.
[8] Therefore, MS Citajaya filed a Notice of Application on 6 August 2021 to seek the Court's leave for an extension of time of the completion d
