LLB 30603LAND LAW II

REGISTRAR’S CAVEAT
INTRODUCTION

u S.319: Nature and effect of RC

u S.320: Circumstances for entry of
RC
u S.321: Procedure for entry and
removal of RC
NATURE AND SCOPE

u RC is entered to protect and

inhibit dealings with land.
u Entry or lodgement of RC does
not create or enhance any
existing claim to title or interest
or give rise to any claim to title
or interest.
Why Registrar’s Caveat?

Prevent Protect
Fraud/ Interest of
Improper SA/
Dealing Federation

Protect interest Secure land

of
minor/unsound
to pay
mind/ absent federal
from country debt.
 Who Can Apply for Registrar’s
Caveat?

Govt.
• Federal Any
Minor, persons
Person/Body
Govt. fearing
with disability,
• State unsound mind/
fraud/improper
absent from
Authority. dealing on its
federation.
land.
DEFINITION

u An official caveat that can be

entered or lodged by the Registrar
on the application by persons who
are specified in s320.
u The R’s power is quasi judicial and
may enter the caveat at his
discretion where ever it appears to
be necessary and desirable.
FUNCTIONS OF RC

u S319(1)(a)- RC may be entered by the

Registrar on the register document of title
to any land in any circumstances specified
in s320.
u S320- RC may be entered if the Registrar
finds it to be
u Necessary , and
u desirable
S320(1)(a)- Prevention of fraud or
improper dealing

u Registrar performs a quasi-judicial function in entering

the caveat.
u He must:-
u Examine the allegation of fraud or improper dealing
u When the evidence that raises suspicion on fraud or
improper dealing is adequate, he must consider to
enter the caveat.
u He is not required to take part of any examination to
prove that the fraud had actually committed or not.
 A registered proprietor may
apply for a RC on his own land

u As a registered proprietor may not apply

for a private caveat on his own land (Eu
Finance v Siland), if, for example his IDT
was stolen and he fears that it will be
misused, he may apply under s.320(1)(a)
NLC for the entry of a RC.
u (See s.323(1) NLC – ‘claiming title to’)
 Boonsom Boonyanit v
Adorna Prop. [1990]

u In this case, Mdm

Boonsom sought entry
of a Registrar’s Caveat
where she complained
that her title had been
used with a forged
transfer to obtain the
registration of Adorna
Property.
 Lim Ah Hun v Pendaftar Hakmilik
Tanah P. Pinang & Anor. [1990]

u The Registrar, in this case

had entered a RC on the
land based on a letter sent
by the 2nd D and a police
report alleging a fraudulent
transfer of the land.
u High Court has powers pursuant to
section 417 (1) NLC to order
Registrar to enter RC pursuant to
section 320 NLC for prevention of
fraud, or improper dealings whether
or not Registrar is a party to
proceedings.
 Palaniappa Chettiar v Letchumanan
Chettiar [1982]

u The court can order the

Registrar to enter a RC to
prevent fraud or improper
dealings in land even if the
Registrar is not a party to
the proceedings.
SEET SOH NGOH V VENKATESWARA
SDN BHD. & ANOR [1976] 1 MLJ 242

u P purchased a piece of land from the 1st D, the

developer, who contracted to build a house on it. It was
agreed between P and 1st D that progress payments
were to be made by the P at various stages of the
building. At the material time, the P had paid to the 1st D
more progress money than it was entitled to. The 1st D
sought to repudiate the agreement on the ground that P
had no money to complete the purchase.
u P obtained an order for injunction against both the 1st D
and 2nd D and further orders requiring the 2nd D to lodge
a Registrar's caveat. The 1st D sought to set aside the
said injunctions.
JUDGMENT

u Section 320(1)(a) of the National Land

Code empowers the Registrar of Titles to
enter his caveat to prevent fraud and
improper dealing.
u if such a possible dealing is brought to the
notice of the court and the Registrar is
before the court, the court can order him to
do so.
Taipan Focus Sdn Bhd v. Tunku Mudzzafar Tunku
Mustapha [2011] 1 CLJ 133, Raus Sharif FCJ (now
CJ) held as follows:

u ”Section 319 of the Code provides that

a registrar's caveat may be entered by the registrar on the
register document of title to any land in any of the
circumstances specified in s 320 of the same. Section 320
provides a registrar's caveat may be entered in respect of
any land wherever it appears to the registrar to be
necessary or desirable, inter alia, for the prevention of fraud
or improper dealing. Section 417 of the same provides the
court or a judge may by order direct the registrar or any
Land Administrator to do all such things as may be
necessary to give effect to any judgment or order given or
made in any proceedings relating to land, and it shall be the
duty of registrar or Land Administrator to comply with the
order forthwith."
DAYANG KHATIJAH JAHAN & ORS V
PENTADBIR DAERAH SEBERANG PERAI
UTARA PULAU PINANG [2018] 1 LNS 236

u Pertaining to the entry of the Registrar's caveat on

the Land. It states as follows:
u "Terdapat unsur penipuan dalam instrumen
urusniaga pindahmilik tanah (14A). Pemindahmilik
iaitu Mariam binti Yahaya telah meninggal dunia
pada 17 Januari 2014 namun terdapat tandatangan
simati bertarikh 17 Februari 2014 di dalam
Instrumen Urusniaga Pindahmilik Tanah (14A)
melibatkan 6 perserahan dan pada 15 April 2014
satu lagi perserahan”
u Judge Lim Chong Fong : “there is in my
view reasonable ground for the entry of
the Registrar's caveat in the Land. A
deceased person could not have executed
instruments of transfer of the Land
subsequent to her death as had happened
here. Several of the transfers benefitted
several of the Plaintiffs making them now
registered proprietors.”
How is a Registrar’s Caveat
Created?

u S.321:
u Registrar will fill in Form 19F and
endorse the entry in the RDT
“Registrar’s Caveat Entered”.
u Then Registrar will notify the
proprietor of land in Form 19A.
Nature and Effect of Registrar’s
Caveat

u S319(1)(b) –the effect of RC is prohibiting the

registration, endorsement or entry of any:
u Instrument of dealing
u Claim to any tenancy exempt from
registration
u Lien-holder’s caveat
u Not prevent the entry of private caveat, trust
caveat or prohibitory order
 Nature and Effect of
Registrar’s Caveat

u It prohibits the registration, endorsement or entry

on the RDT of any instrument of dealing on the land
even though the instrument was presented prior to
the time the Registrar’s Caveat takes effect.
u In other words, it has the effect of preventing
registration of any dealing, which was presented for
registration and yet to be registered when RC was
entered. Thus, it can apply retrospectively as
opposed to a private caveat that only applies to
future dealings.
u See s.319(2).
u The desirability of entering a Registrar's caveat lies in
the fact that the caveat has retrospective effect from the
time of its entry on the Registrar's document of title. This
means that the Registrar's caveat will prevent any
instrument presented for registration (even though
presented prior to the entry of the caveat) from being
registered.
u This applies equally to any claim for the endorsement of
a tenancy exempt from registration and any claim for the
entry of a lien-holder's caveat even though the latter two
claims were received prior to the entry of the
Registrar's caveat.
u Thus if a vendor, having sold his land to a
purchaser who has yet to present the instrument of
transfer for registration, subsequently commits
fraud on the first purchaser by selling it to a second
purchaser, who has presented the instrument of
transfer for registration, the subsequent entry of a
Registrar's caveat on the title to the said land will
prevent the registration of the said transfer in favour
of the second purchaser, even though the latter
is bona fide.
Registrar’s Power to Enter a RC

u S.319(a) NLC.
u How must this power be exercised?
u The Registrar must be satisfied that the
information or material supplied to him in
support of the request for the entry must
be credible on the face of it.
u He must act reasonably according to the
circumstances of the case.
Wong Kim Fatt, JC interpreted
the word ‘may’ in s.319:

u “It is clear…the Registrar may act on his

own motion or upon information/request
made to him. The word ‘may’ indicates a
discretion on the part of the Registrar.
…Thus in the case of the entry of a
Registrar’s Caveat, the Registrar is said to
perform a quasi-judicial function in the
exercise of that discretion but the
discretion must always be exercised
judiciously and not arbitrarily…”
Cont.:

u “..by contrast, in the case of an

application for the entry of a
private or lien-holder’s caveat,
his function is purely ministerial
or administrative.”
 Tan Soo Bing & Ors.v Tan
Kooi Fook [1996]

u Federal Court held:

u A person who desires to have a Registrar’s
Caveat entered in respect of any land must
first apply to the Registrar. If the Registrar
refuses the application, his remedy is to
appeal to the court under s.418 of the Code
against such refusal.
u # under section 418 NLC- court may reverse
decision of Registrar and direct him to enter
RC#
S 320(1)(b)- To protect the interest
of certain people

Section 320(1)(b)
u To protect the interest of:
a) The Federation or State Authority
b) Any person under:
i. Minor
ii. Insane person
iii. Absent from the Federation
u Sec 320(1)(ba) – To restraint the
land from being dealt with in order to
ensure that the land is available to
satisfy the whole or any part of debt
due to the Federation/ State
Authority, whether such debt is
secured or unsecured and whether
or not judgment has been obtained
u A Registrar’s Caveat can be used by the
Inland Revenue Department to prevent any
dealings on land belonging to a person or body
who owes tax to the government.
u Thus, a RC can be entered under s.320(1)(ba)
to protect any secured or unsecured debt due
to the Federation or State Authority.
u Eg: Unsecured debt includes credit card debt,
medical bills, utility bills.
u Secured debt includes mortgage, charge
Case: MBF FINANCE BHD V PENDAFTAR HAKMILIK
NEGERI PERAK & ANOR [1990] 3 MLJ 437

The proprietor of the land charged his land to the

applicant and the charge was registered under the
NLC. Later, the first Respondent (the Registrar)
entered a Registrar’s Caveat on the land due to the
income tax due to the State (Inland Revenue-
second R)
The applicant, being the registered chargee applied for
the removal of the RC and sought for the
declaration that his right as registered chargee
ranked in priority over the second Respondent.
u It was submitted that the first respondent had a quasi-
judicial function to perform and had acted mala fide in
entering the caveat as he should have noticed the
registered charge.
u It was also submitted that the second respondent had no
registrable interest in the lands and that he had not
proceeded to take action with haste as the caveat
functioned like an interim injunction.
u Held:The Registrar may, if he thinks necessary or
desirable, enter such a caveat in respect of any debt
whether secured or unsecured, due to the Federation or
the State Authority
 Who has Priority? Prior Registered
Chargee or Government under a RC?

u Let’s say a land owner has borrowed

money from a bank and creates a
charge on his land. Then, a few years
later, it is found he owes tax to the
government and the government enters
a RC on his land.
u Is the chargee bank’s right adversely
affected by the RC on the land?
 D&C Bank Bhd. V Land
Administrator, WP & Anor. [1991]

u Supreme Ct. held:

u The indefeasible interest of the
chargee takes priority over the
subsequent Registrar’s Caveat.
u Nevertheless, there is nothing
unlawful in the entry of a RC merely
because there is an existing charge.
Pendaftar Hakmilik N. Kedah v
OCBC Ltd.[1991]

u Supreme Ct. held:

u Before exercising his discretion under s. 320(1)(ba)
to enter a RC, the Registrar must first find out the
market value of the land, the debt due under the
prior charge and the debt due to the government.
u If the debt due under the charge is more than the
market value of the land, the Registrar should not
enter the RC as the debt due to the government
cannot be satisfied from the land.
 MUI Finance Bhd. v Pendaftar
Hakmilik, Shah Alam & Anor. [1993]

u Held: Neither s.320(1)(ba) of the

NLC nor the Income Tax Act
empower the court to order that the
land be sold to satisfy the debt to the
government.
u The court also cannot order that the
land cannot be charged to another
party until the tax is settled.
Disability of minority

u Registrar can enter RC to

protect interest in land or a right
to such an interest for a minor.
u Age of majority Act 1971
provides in section 2 that age of
majority is 18 years old.
Mental disorder or unsound
mind

uRegistrar can enter RC to

protect interest in land or
a right to such an interest
for a person who is
unsound mind.
Absent from Federation

u Registrar can enter RC to

protect interest in land or a
right to such an interest for a
person who is absent from
federation.
 Error in the document registered/any
related document

Sec 320 (1) (c) of NLC:

‘by reason of some error appearing to him to
have been made in the register or issue
document of title to the land or any other
instrument relating thereto.’
The RC can be entered to protect the register
pending the Registrar correcting errors on the
RDT to any land or any other related
instruments that appears to the Registrar
necessary to be made.
 Removal of Registrar’s Caveat

u A RC can be removed by 3 ways:

u 1) By the Registrar of his own motion.
(s.321(3)(a))
u 2) On an application by the proprietor of the
caveated land. (s.321(3)(b))
u 3) Pursuant to a Court Order granted to the
proprietor against the refusal of the Registrar to
remove the caveat under s.418 NLC.. (s.321(3)(c))
Removal by Registrar – section 321(3)
(a) NLC

u Registrar can remove

caveat when he is of view
that there is no need for
caveat to remain as it has
served its purpose.
Removal by Landowner – section 321
(3) (b)

u Registered proprietor
(caveatee) of land, upon
receiving Notice of Entry of
caveat Form 19A can apply
to Registrar to remove
caveat.
 Can a Chargee Apply to
Remove a Registrar’s Caveat?

u MUI Finance Bhd. V Pendaftar Hakmilik

Shah Alam & Anor. [1993]
u Held:
u Under s.321(3) NLC, a chargee does not
have any right to apply for cancellation of a
RC as this can only be done by a
registered proprietor.
u Malayan Banking Bhd. V. Pendaftar Hakmilik, Negeri
Pahang & Anor. [1990] 2 CLJ Rep 425 which explains
on who can apply for the removal of Registrar’s Caveat.
Applicant in this case was the registered chargee of the
land in relation to a loan in favour of the chargor. Upon
defaulting the loan, the chargor wanted to sell the
property but Registrar’s Caveat was discovered on the
land for failure to pay income tax. MBB applied to remove
the caveat. The court dismissed this application on the
ground that section 321(3)(b) state that the proprietor of
the land which in this case is the chargor, who should
apply to remove the caveat and not MBB, the chargee.
DEVELOPMENT & COMMERCIAL BANL BERHAD v
GOV OF MALAYSIA & ORS (1989) 3 MLJ 359

u Tan charged his land to the P. he defaulted in payment. On Oct

3rd 1987, the P obtained a court order of sale on the land under
Sec. 256 of the NLC. On Oct 23 1988, the Registrar entered a
RC on the some piece of land acting under sec. 320(1)(b)(i) and
(ba) because of the request made by the Department of Inland.
Revenue to protect the federation’s interest on Tan’s land. This
was because Tan had not paid his income tax to the
government. The P then applied for an order that the RC should
be cancelled or removed under Sec. 417.
u Held: The application was dismissed because the NLC lays
down the sections on how a RC can be removed and cancelled
and these as under Sec. 321(3). The remedy open to the P was
to appeal against the decision of the Registrar under Sec.
321(3)(c) which is to be need to Sec. 418.
u In Pembangunan Tanah dan Perumahan
Sdn Bhd v. Pengarah Tanah dan Galian
Negeri Johor & Anor [2020] 2 CLJ 399, the
principle is that, the application for removal of
Registrar’s Caveat will be rejected when the
procedures provided in section 321 of NLC
failed to be follow. Not only that, the removal
will also be refused when the applicant failed
to provide correct information which regards to
the lots of land to be removing.
PUBLIC BANK BHD v PENGARAH TANAH & GALIAN
JOHORE BHARU & ANOR (1990) 2 MLJ 510

u The P’s bank was the charges of a piece of land. After

the charge had been registered, a Registrar’s caveat was
entered by the D, on the request of the Inland Revenue
Department. The P then applied to the Registrar to have
the caveat removed, the application was rejected in Dec
1988. In January 1989, the P filed an appeal to the HC
under Sec. 418 of the code against the decision of the
defendant.
u Held: Sec 321(3) of the code did not apply to this case as
there had been no application of the land. The learned
judge held that the P (bank) was not the proprietor and
had no right to apply for the cancellation of the RC under
that provision of the code.
Pursuant to court order –
section 321(3) (c)

u Caveatee can apply against decision of

Registrar not to remove caveat pursuant to
section 418 – sec 321 (3) (c) NLC.
u According to section 321 (3 ) (b) NLC- the
registered proprietor is required to appeal
to High Court within 3 months from the
time of communication of decision of
Registrar rejecting the application to
remove Registrar’s caveat.
u Registered chargee aggrieved by
entry of Registrar’s caveat has a
right to seek to remove the RC from
time entry of caveat is
communicated to them.
u Appeal can be made pursuant to
section 418 of NLC.
u In other words, a RC continues in force indefinitely until it
is cancelled by the Registrar either on his own motion, or
upon application by the proprietor of the land or pursuant
to a court order on appeal under section 418 of the NLC
against any decision to enter the caveat or against his
decision to refuse any application for its cancellation -
Section 321(3) of NLC.
u Where the RC has been cancelled on his own motion,
the proprietor of the land must be notified of the
cancellation. In all cases of cancellation, the Registrar
must make a note under his hand and seal of the date of
cancellation.