2 ML. te Chong Public Prosecutor iberforce). 267 PRIVY COUNCIL REPORTS LEE CHOW MENG y. PUBLIC PROSECUTOR [Privy Council (Lord Wilberforce, Lord Russell of Killowen, Lord Keith of Kinkel) May 10, 1979] Simin Lan od, Rrgeture — Pein Joy, eae 0 appeal from desuion of Federal Court Privy Counel = $esdition “Courts budicatre (Amendment) het, 1976 (acta 528), 13. In this case the appellant vas convicted by the Special Presdeot in Ruals Lumpur on Apri 19, 1915 and the court {imposed consecutive sentences on him for vatious offences 10 Whee she. pleaded. guilty. He" appealed against. sentence To the High Court which dismised his appeal'on October 2, 1315" Ou January 23, 1976 reference ona question of law by the igh Court {othe Federal Court was abolished but Rebtel eppeat from the High Court to the Federal Court Eonferred’ On Apu 12. 1976, the High Court granted the defendant a certifcae of refereice on a question of law to the Federal Court, On September 8, 1976, the Federal Court re- fused to consider the reference but insiead. gave the appellant {eave to appeal out of time. By a judgment dated April 8, 1598 the Federal Coure struck out the appeal on tae ground that'at the time of his conviction the appellant had fad.no Fgh "of Sppeat to the Federal Court (Da) 2 Md 6) appellant applied for special Teave to. appeal informa paspend trom the decison of the Federal Court Hdd: the effect of section 13 of the Cours of Judicature (Asvendient), Act, 1916, m to exclude the right Of appeal (orfang di-Pertan Agong in criminal matters and therefore the Pav Counci has no fiudiction to entertain the applica: PRIVY COUNCIL APPEAL FROM MALAYSIA. Jagiit Singh for the appellant. P. Medd, Q.C. for the respondent. Lord Witherforce (delivering the judgment of the Board): Their Lordships are of opinion that this peti- tion must be dismissed. They consider that they have no jurisdiction to entertain it or to entertain an appeal. ‘They consider that the effect of the amendment of section 74 of the Courts of Judicature Act, 1964, which is effected by section 13 of Act No. A328 of Malaysia, and in particular subsection (4) of that section 13, makes it perfectly clear that the amendment in, ques- tion, which deletes the right of appeal in criminal matiers, applies to all cases except those in which an appeal or an application for appeal is pending at the date of coming into force of the section, namely January 1, 1978 It is not possible to say on any view of the matter that there was pending on Januai 1 1978, ether an appeal or an application for appeal, and therefore their Lordships consider that the right of appeal in this criminal ‘matter to the Yang di- Pertuan Agong is excluded. For this jurisdictional reason their Lordships are unable to entertain the petition, Petition dismissed. Solicitors: Coward Chance: Stephenson Harwood A H T. DAMODARAN v. CHOE KUAN HIM IP.C. (Lord Diplock, Lord Mortis of Borth-y-Gest, Lord Edmund-Davies ‘and Lord Fraser of Tolieybelton) ‘April 3 and June 11, 1979] [Privy Council Appeal No. 24 of 197] Legal, Projesion — Solicitor — Undertaking to pay bata f purchase moneys on retration of ranaer of land Lis pendens registered against land by third party — Effect oh nelle Laren of Cand — Rexioraion — In lfeasble ttle — Lis (Neff of registration agains: and’ National Land Codes sx. 215, 297, 340 4 417. English Law — Reception of — Lis pendens — Civil Law Act, 1956, 5.6. In this cage the respondent as advocate and solicitor was ‘acting for both the purchasers and the vendor ol a piece of find. He gave an undertaking to confirm that the balance of the purchase money had been deposited with his firm and that thie could be paid to the vendors upon the transier of the land being registered. The tansier was duly registered but in the meantime a third person had obtained a lis pendens and this had been registered against the land. "The respondent indicated that he would pay’ the money into court but the ‘appellant, the vendor, applied for the payment of the money to Bim. "The leaned wal judge intially in Chambers ordered ‘payment of the money fortavith to the appellant but sequently alter further argument he ordered the money 10. be Bais io coure ay federal Court. which, {pay the “nto court vendor “see [1906 2 MLA, Hild: (1) the terms of the solicitor’ undertaking were clear, ungualifed and unequivocal and there was no reason ‘why the appellant should not recover the balance of the pur- Shave prise (2) even if the entry in the register of the order of lis ender a lawl 1 Served othe Purp at all and fhe purchaser in this case, had obtained the tie 10 the land free"Irom encumbrances, @) where by reagon of a pending action in which the tite So registered land is ta daputo tt would be ust to the registered proprietor’ right to transfer the land the determination of the action, the proper and effective. way fof doing s0 1s by entry of a private caveat. Cases referred t0:- (Q) Damodaran v. Vesudevan (1915) 2 MLS. 231. @) Fels v. Knowles (1906) 26 NZ.LR. 604, 620. ©) Brg Meg Yorg & Ors. ¥. ¥. Letchumanen [1979] 2 MLI Si. () Bellamy v. Sabine (1857) 1 De G. & J. 566, $80. PRIVY COUNCIL APPEAL FROM MALAYSIA. DK, Ratee Q.C. (CW. Wong with him) for the appellant. Lim Kean Chye (A. Jayadeva with him) for the respondent. Cur, Adv. Vue. Lord Diplock (delivering the judgment of the Board): This, on the face of it, was a very simple case, well suited to be disposed of under the summary pro- cedure which is available in Malaysia, as it is in Eng- land, for enforcing solicitors’ undertakings. The under- taking which the appellant (herein referred to as “the vendor”) seeks to have enforced was given by the respondent (herein referred to as “‘the solicitor”) in connection with the sale of five parcels of land in Kedah to clients of the solicitor (herein referred to as “the purchaser”). The essential facts about the sale can be stated briefly.'T. Damodaran v, Choe Kuan Him oe (Lard Diplock) {1979} The vendor was the registered proprietor of the land which was subject to a registered charge in the sum of $150,000. On August 2, 1973, he agreed to sell the land “free from all encumbrances whatsoever" toa Mr. Andawan who later, with the vendor's con- sent, assigned the benefit and burden of the contract to the purchaser. The price was $369,768 of which $36,976 was paid as a deposit, the balance being pay- able on completion which was stated to be on or be- fore February 1, 1974. ‘On March 6, 1974, the solicitor gave to the vendor a written undertaking in the following terms: “To Mis T. Damodaran s/o P, V. Raman, No. 4211, Sunge! Nyor Rosd, Batterwortn Re: Sale of lands held under Grant Nos, 31020, for Lot 1003, 16830 for Lot 191, 16851 for Lot 142, 16832 for Lot 143, 16833 for Lot 144 all th the Mukim of 3p. Pasir, Disrcr of Kula Muda. ‘This isto confirm that the sum of Ringgit Three hundred and thirty-two thousand, seven hundred and ninety two ($332,792) being the balance of the purchase price ‘of the abovesaid lands has been deposited with us and that the said sum will be released to you upon the transfer of the said lands bel uly registered Tn the name of the Purchaser Messrs. Syarkat ‘Alor Merah Sdn, Bhd. or their ‘nominee, nominees Or assigns Bated this 6th day of March, 1974." Out of the monies referred to in this undertaking, the solicitor paid off the charge of $150,000, and on April 16, 1974, the vendor obtained the registration Of the purchaser as registered proprietor of the land. On April 23, 1974, the solicitor sent to the vendor his firm's cheque for the balance of $182,200. On April 27, however, the cheque was stopped, and payment ‘was not made. The terms of the solicitor’s undertaking are clear, unqualified and unequivocal. The event on the hap- pening of which the money was to be paid took place on April 16, 1974, when the transfer of the lands was “duly registered in the name of the purchaser Messrs. Syarikat Alor Merah Sdn. Bhd.” The failure to pay the balance of $182,200 is, on the face of it, a plain breach of the undertaking. There would seem to be wo easy why in the inant proceeds commenced on July 30, 1974, by originating summons against the solicitor to enforce the undertaking, the vendor should not recover judgment for the balance of $182,200 with interest from April 16, 1974 ‘Syed Agil Barakbah J., before whom the origina- ting summons was heard, initially in chambers, did on December 7, 1974, order'the solicitor to pay forthwith to the vendor the sum of $182,200 with interest at 12% per annum from April 16, 1974; but no order to this effect was then drawn up because the case was ad- journed for further argument. As a result of further argument, instead of ordering payment to the vendor the learned judge, by order of July 14, 1975, ordered the solicitor to pay the money with interest thereon “into court as deposit”. On appeal to the Federal Court the judge’s order for payment into court instead of to the vendor was upheld by 2 majority (Sufian LP. and Wan Suleiman ; Ali FJ. dissenting). The order was varied as respects the award of interest, but it is not necessary to go into this for the purpose of the instant appeal Ali FJ, would have ordered payment of $182,200 direct to the vendor with interest at 6% from August 20. 1976, to date of payment. What has complicated this comparatively simple case and led to the making of this most unusual order, is the existence of a concurrent suit relating to the same land, brought by a Mr. Vesudevan (herein re- ferred to as “the claimant”) against the vendor. This concurrent litigation was preceded by at- tempts by the claimant to register a private caveat against the land claiming that he was entitled to an undivided hali-share interest in it. On August 21, 1974, he obtained entry of a private caveat under sec: tion 324(2) of the National Land Code, but the vendor successfully applied to the High Court under section 327 for its removal. Apparently the claimant subse- quently obtained entry of a second caveat despite the prohibition contained in section 329(2). This also was removed upon the vendor's application to the High Court and the claimant was restrained by injunction from entering any further caveats. Their Lordships do not now the grounds on which the caveats were remove On December 19, 1973, the claimant issued a writ against the vendor in the High Court in Malaya at Alor Star claiming an undivided half-share interest in the land; and on the following day he obtained ex Parte an order of the court that the right in the dis- puted land was in question and that the order should Temain in force as a lis pendens for twelve months for until the determination of the suit, whichever was the earlier. This lis pendens order was entered on the register document of title to the land on December 22, 1973. On February 9, 1974, the vendor applied to the High Court to have the lis pendens order set aside. His application was dismissed by the judge on April 27, 1974. It was as a result of this dismissal that, the’ solicitor decided to stop the cheque for $182,200 in favour of the vendor. The subsequent history of the lis pendens order is that the vendor's appeal to the Federal Court against the judge’s refusal to set it aside was dismissed by that court on July 12, 1975: Damodaran v. Vesu- devan.®’ No appeal to His Majesty the Yang di- Pertuan_Agong has been brought from that decision of the Federal Court. So, as between the vendor and the claimant, the right of the latter to have the lis pendens order entered on the register document of title to the land is res judicata: but it is not res judi- cata as between the vendor and the solicitor or, what is more to the point in the instant appeal, between the claimant and the purchaser. Nevertheless the fact remains that the lis pendens order was entered on the register on December 22, 1973, and was there at the time when the transfer of the Ownership of the land from the vendor to the purchaser was registered. It has been renewed from time to time and remains so entered until the present day, since the suit by the claimant against the vendor has 'not yet been determined. The solicitor knew of the entry on the register of the lis pendens order on March 6, 1974. Nevertheless2 ML. . Damodaran y. Choe Kuan Him ‘Lord Diplock) 20 on that day he gave an unqualified undertaking to pay 4 taking in transactions for the sale of land is that it is ‘over the balance of the purchase price to the vendor upon the transfer of the land being duly registered in the name of the purchaser. He may well have thought that either the lis pendens order, which bad been ob- tained ex parte and was unprecented in Malaysia in relation (o land under the National Land Code, would be set aside when the application for thit purpose ‘came before the judge, or if it were not set aside, the transfer of the land to the purchaser would not be entered on the register. However this may be, he took the risk; the vendor was able to fulfil the condition; and their Lordships agree with the dissenting judg- ment of Ali FJ. that there was nothing to justify de- privng the vendor of an order for payment directly to him of the sum due under the undertaking. In making the order that he did for payment of the money into court the judge (Syed Agil Barakbab J.) did not found himself on tne entry on the register of the lis pendens order. He believed this to be still under appeal to the Federal Court in the swt between the claimant and the vendor although in fact judg~ ‘ment upholding its validity bad been given by the Federal Court two days before. He rehed upon the existence of that suit selfs justifying hs exercising hhis discretion to order payment of the money into court “‘in the interest of justice and in order to safe- guard the interest of the plaintiff [sc. the claimant, Vesudevan] should he succeed in his claim”. The claimant was a stranger to the proceedings between the vendor and the solicitor. In their Lord- ships’ view, the protection of the ‘interests of the claimant was not & ground on which the judge could properly exercise a discretion to order payment into court in those proceedings instead of to the vendor. In the Federal Court Suffian L.P. with whose judgment Wan Suleiman FJ. agreed, ‘put the reasons for exercising a discretion to order’ payment of the money into court quite differently. He considered that the undertaking should be considered not in isola- tion but in the light of the sale agreement between the ‘vendor and the purchaser under which the vendor had undertaken to give a title to the land free from all encumbrances. “If the claimant's suit against the ven- dor were ultimately to sucoeed the Lord President was ‘of the opinion that the purchaser would not have obtained an unencumbered title by his having been registered as proprietor of the land on April 16, 1974; and accordingly the purchaser would have a’ claim against the vendor under the contract of sale and pro- bably one against the solicitor too. This, the Lord President considered, would not be fair to the solicitor. The purchaser, like the claimant, was a stranger to the proceedings’ between the vendor and the soli- citor; and their Lordships do not consider that the possibility of claims being made in the future by a sttanger to the proceedings, even where those claims arise out of the transaction in relation to which the undertaking was given, is a matter which the court is entitled to take into ‘consideration as a ground for ordering payment into court instead of to the vendor himself of money adjudged due to him by the solicitor. The purpose and value of a solicitor’s under- enforceable against the solicitor independently of any claims against one another by the parties to the con- tact of sale. There is, however, a further reason for allowing the appeal with which’ their Lordships feel compelled to deal lest their failure to do so should allow the integrity of the Torrens System of registration of title to land in Malaysia to be undermined. The assump- tion underlying the decision of the majority in the Federal Court to order the money to be paid into court is that the purchaser on becoming registered as proprietor of the land on April 16, 1974, did not there~ by obtain a title to the land free from encumbrances, which he continues to hold. In their Lordships’ opinion this assumption is in- comet. The National Land Code appues to Malaysia the Torrens System of registrauon of ttle to land. The whole purpose of the system is to get away from the compucated system of rutes whica in id regulate deaungs with land, particularly those reiaung to suca matters as nouce of ces and trusts. As was said by tae Court of Appeal of New Zeaiand in relation to the corresponding New Zealand iegsia- tion, the Land Transfer Act, 1885: “The cardinal ‘of the statute is that er is Becerra he ane ae tse Dart ot ie person dealing with the regstered proprietor, such ‘Petson, Upon registration ot the tite uncer Walch De’ takes {om the repstered proprietor, has an indeveasible ute against all "the ‘won. Noiting can be registered ne registration of Which can bo Topiiored gives in the abtenceof Laude af Indefeasible tie to the este or inwerest” Fete v. Knowles. Jn the National Land Code itis section 249 that expressly provides that the title of a person registered as propnetor of any land shall be indefeasible. The only exceptions are where there has been fraud, mis- representation, forgery or an ultra vires acquisition purporting to ‘have been made under statutory autho- Fity. None of these exceptions apply to the instant case. Interests in land, short of proprietorship, which are capable of being registered are leases, charges and easements. If registered they would amount to en- ‘cumbrances within the meaning of a covenant against encumbrances; but unless registered they do not dero- gate from the unencumbered title of the registered Proprietor of the land. Claims to be entitled to the Proprietorship of land or a registrable interest in land, ‘whether or not they are the subject of litigation, are not registrable as encumbrances on a registered title. Insead they are protected by the system of private caveats which, while leaving the registered title unqua- ified and intact, have the effect of preventing any dealing with it by the registered proprietor so long as the caveat remains in force; that is, until it is removed from the register. The way in which this system of protection operates was dealt with by their Lordshi in the recent case of Eng Mee Yong & Ors. Letchumanan, 19 which reference may conveniently made. This method of protecting claims to land and to registrable interests in land under the Torrens System is wholly inconsistent with the concept of lis pendens as it was developed as part of the land law of England.‘T, Damodaran v. Choe Kuan Him 270 (Lord Diplock) {1979} Lis pendens in English law was originally based on the theory that so long as the title to property was being litigated in a court of justice parties to the ltiga- tion were incapable of alienating it because otherwise any judgment of the court might be frustrated: Bellamy v, Sabine.) A person to whom land was transferred While its title was the subject of dispute in a pending action obtained a defeasible title only. The doctrine did not originally depend on notice to the alienee nor was there any provision for registering a lis pendens until the Judgments Act, 1839. Thereafter a lis pen- dens did not bind a stranger unless either he had ex- press notice or the lis pendens was registered. These provisions of the Judgments Act, 1839 were repealed by the Land Charges Act, 1925, which substituted simi- lar provisions for the registration of pending actions; but neither the original common law doctrine of lis pendens nor the statutory modifications of it in Eng- fand have any application to Malaysia. By section 6 of the Civil Law Ordinance, 1956, ‘the law of England relating to the tenure or conveyance ot sBeme Seneca cas estate, Fight oF interest therein” is expressly excluded from the general reception of English common law and rules of equity as part of the law of Malaysia. The National Land Code makes no provision for the registration of a lis pendens. Counsel for the soli- citor has drawa their Lordships’ attention to section 417 of the National Land Code which provides that the court “may by order det the Registrar to do all such things at fiven or ade in any proceedings relating 19 land and it shall the duty of the Registrar to comply with the order forth- But this, in their Lordships’ view, does not authorise the court to direct the Registrar to make on the regis- ter entries of a kind for which no express provision is made by the National Land Code and which are inconsistent with the whole scheme of the Act; nor was section 417 relied on by the Federal Court in Damodaran v. Vesudevan (ubi sup.) as the source of power to order the registration of an order of lis pen- dens. The statutory source of power relied on by the Federal Court was section 25(2) and paragraph 6 of Schedule 1 to the Courts of Judicature Act, 1964, which vests in the High Court “power to provide for the interim preservation of property fe bjs ar of aay aes ot er by fale on ty ie Epo gvear of ale pendens or ia any other Manner What foever: In its judgment in Damodaran v. Vesudevan (ubi sup.) upholding the original order for registration of a lis pendens against the land at a time when the vendor, ‘whose title was in dispute in that action, was still the registered proprietor, the Federal Court’ explicitly re- frained from expressing any opinion as to what effect it would have upon the title of a subsequent purchaser of the land from the vendor. In their Lordships’ view the effect of the National Land Code is (1) that the registration of the lis pendens ‘would not prevent the person registered as proprietor of the land (in the instant case, the vendor) from trans- ferring the land to a transferee (in the instant case, the purchaser) and obtaining the registration of the transferee as registered proprietor in his stead; (2) that lupon registration as proprietor the transferee would hhave an indefeasible title to the land against all the world, including the person in whose favour the order of lis pendens nad been made; and (3) that the title of the transferee would be free from all encumbrances other than leases, charges and easements affecting the land and duly registered ‘The functions of the Registrar in making the en- tries on the register for which the National Land Code provides are ministerial. Provided that tne documents presented for registration are in the form provided tor 1m the Code and executed by the proper party it is the duty of the Registrar under section 29/ to register them and to make tne appropriate memorial, entry or en- dorsemient on the register document of title. In de- ciding whether an instrument of transfer is executed by tne proper party the Registrar is bound by section 340 to teat the title of the registered proprietor to dispose of the land as indefeasible. In the instant case, accordingly, the Registrar had no power to re- fuse’ to register the transfer of the land from the vendor to the purchaser on April 16, 1974. Once registered as proprietor of the land the title of the transieree in its tum becomes indefeasible un- der section 340. In saying this their Lordships have not overlooked the provision in section 215(3)(d) that the transferee shall hold the land subject to “all other matters then appearing on, or referred to in, the register document of title”. ‘The Code itself, however, contains no provision for any entry on the register document which would have the effect in law of making the title of a registered proprietor defeasible, and to construe the generality of the words in section 215(3)(d) as creating an exception to the express provision in section 340 that the title of the registered proprietor shall be indefeasible, would, in their Lordships’ view, be inconsistent with the whole scheme of simplified land tenure and conveyancing for which the National Land Code was intended to provide It follows that, in their Lordships’ view, the entry fon the register of an order of lis pendens is a mete brutum fulmen. Even if it be lawful to make such an entry at all, it serves no useful purpose and their Lordships would suggest that the precedent set by Damodaran v. Vesudevan is one which ought not to be followed. Where by reason of a pending action in which the title to registered land is in dispute, it would bbe just to suspend the registered proprietor’s right to transfer the land pending the determination of the action, the proper and effective way of doing so is by entry of a private caveat. Their Lordships will accordingly advise His Ma- jest the Yang di-Pertuan Agong that this appeal should be allowed and that the respondent should be ordered to pay to the appellant the sum of $182,200 together with interest thereon at 65% per annum from April 16, 1974, and costs here and in the courts below. Appeal allowed. Solicitors: Stephenson Harwood: Philip Conway Thomas & Co.