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Malayan Law Journal Reports/1997/Volume 2/KIMLIN HO !IN" #$V$LOPM$N% !#N &H# '(PPOIN%$# R$)$IV$R (N# M(N("$R* 'IN LI+ I#(%ION* , &(NK & MIP %R( 'M* &H# - OR! . /19970 2 MLJ 123 . 24 May 1997 25 pages /19970 2 MLJ 123

KIMLIN HOUSING DEVELOPMENT SDN BHD (APPOINTED RECEIVER AND MANAGER) (IN LIQUIDATION) v BANK BUMIPUTRA (M) BHD & ORS
SUPREME COURT (KUALA LUMPUR) LAMIN PCA, EDGAR JOSEPH JR FCJ AND NH CHAN JCA CIVIL APPEAL NO 02- 00-!" 2# M$% !!& Companies and Corporations -- Charges -- Sale by debenture of land charged under the National Land Code 1965 -- Debenture registered under s 10 of the Companies !ct 1965 conferred chargee "ith po"er of sale of land "ithout the necessity of obtaining #udicial sale -- $hether s 10 of the Companies !ct 1965 is an independent source for creation of an interest in land -- National Land Code 1965 ss %06&'( ) %5* -- %65 -Companies !ct 1965 s 10 Companies and Corporations -- Debenture -- Sale by debenture of land charged under the National Land Code 1965 -- Debenture registered under s 10 of the Companies !ct 1965 conferred chargee "ith po"er of sale of land "ithout the necessity of obtaining #udicial sale -- $hether s 10 of the Companies !ct 1965 is an independent source for creation of an interest in land -- National Land Code 1965 ss %06&'( ) %5* -- %65 -Companies !ct 1965 s 10 Land La" -- Charge -- +ights of chargee -- Sale by debenture of land charged under the National Land Code 1965 -- $hether such sale is permissible -- $hether charge ta,es effect as a security only enforceable by proceedings in court to obtain #udicial sale -- $hether rights of chargor under the National Land Code 1965 can be "ai-ed or contracted out -- National Land Code 1965 ss %06&'( ) %5* -- %65 -- Companies !ct 1965 s 10 %6e 7orrower 8ompany '9t6e appellant9* was t6e reg:stere; propr:etor o< 8erta:n lan;s '9t6e lan;s9*= %6e appellant e>e8ute; two legal 86arges '9t6e 86arges9* un;er t6e Nat:onal Lan; )o;e 19?3 '9t6e NL)9* o,er t6e lan;s :n <a,our o< &an@ &um:putra 'M* &6; '9t6e <:rst respon;ent9* to se8ure 7an@:ng <a8:l:t:es grante; to t6e appellant= %6e 86arges were ;uly reg:stere; un;er s 121 o< t6e )ompan:es (8t 19?3 '9t6e (8t9*= !u7seAuentlyB t6e appellant e>e8ute; a ;ee; o< ;e7enture :n <a,our o< t6e <:rst respon;ent to se8ure ,ar:ous 7an@:ng <a8:l:t:es '9t6e ;e7enture9* w6ere7y t6e appellant 8reate; 7ot6 a <:>e; 86arge an; a <loat:ng 86arge= %6e ;e7enture was ;uly reg:stere; pursuant to s 121 o< t6e (8t= %6e ;e7enture pro,:;e;B :nter al:aB <or t6e 7an@ to appo:nt re8e:,ers an; managers an; <or su86 re8e:,ers an; managers to 6a,e 8erta:n powers= !u7seAuentlyB e,ents o88urre; upon w6:86 t6e powers to appo:nt re8e:,ers an; managers un;er t6e ;e7enture 7e8ame e>er8:sa7le= On 15 (ugust 1917B pursuant to su86 powersB t6e 7an@ ;uly appo:nte; t6e se8on;B t6:r; an; <ourt6 respon;ents as re8e:,ers an; managers o< t6e appellant '9re8e:,ers an; managers9*= !:n8e t6ere was no e>press pro,:s:on :n t6e ;e7enture appo:nt:ng t6em attorneys o< t6e appellant an; 7e:ng ;es:rous o< sell:ng t6e lan;s w:t6out resort:ng to pro8ee;:ngs un;er t6e NL) to o7ta:n a Cu;:8:al saleB t6e re8e:,ers an; managers appl:e; to t6e H:g6 )ourt 7y way o< or:g:nat:ng summons <or lea,e to sell t6e lan;s '9t6e 199. % /L0 05 at 06 appl:8at:on9*= On 27 De7ruary 1919B t6e appellant went :nto l:Au:;at:on an; t6e appl:8at:on 7y t6e re8e:,ers an; managers was oppose; 7y t6e l:Au:;ator '9t6e l:Au:;ator9*=

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In t6e 8ourt 7elow 'see /19950 2 MLJ 12?*B t6e learne; Cu;ge 6el; t6atE ':* t6e re8e:,ers an; managers were ent:tle; to sell t6e lan;s w6:86 were su7Ce8t to t6e 86argesB w:t6out ta@:ng pro8ee;:ngs un;er t6e NL) to o7ta:n a Cu;:8:al saleF an; '::* t6e <a8t t6at a 8ompany 6as 7een put :nto l:Au:;at:on ;oes not a<<e8t t6e se8ur:t:es 6el; 7y t6e re8e:,ers an; managersF at least not unt:l t6e se8ure; 8re;:tors 6a; 7een <ully pa:; o<<= %6e se8ure; 8re;:tors 8oul; t6ere<ore ;:spose o< t6e se8ur:t:es ;esp:te t6e l:Au:;at:on= %6e tr:al Cu;ge <urt6er sa:; t6at re8e:,ers an; managers were ent:tle; to w6at t6e ;e7enture pro,:;e; <or= %6e l:Au:;atorB 7e:ng ;:ssat:s<:e; w:t6 t6e Cu;gment o< t6e 8ourt 7elow appeale;= )ounsel <or t6e <:rst respon;ent rel:e; on s 22?'5* o< t6e NL) w6:86 pro,:;es t6at t6e pro,:s:ons o< t6e NL) reAu:r:ng a ;eal:ng to 7e e<<e8te; :n t6e statutor:ly pres8r:7e; manner s6all not a<<e8t t6e 8ontra8tual operat:on o< any transa8t:on relat:ng to al:enate; lan; or any :nterest t6ere:n= %6e Auest:on <or ;eterm:nat:on was w6et6er t6e learne; Cu;ge was r:g6t :n 6ol;:ng as 6e ;:;= H'()B allow:ng t6e appealE '1* 1 n;er 8ommon law mortgageB t6e r:g6ts an; powers o< t6e mortgagee are t6ose w6:86 are :n8:;ental to t6e legal or eAu:ta7le estate ,este; :n 6:m :n 6:s role as mortgageeF w6ereas :n t6e statutory 86arge un;er t6e NL)B t6e r:g6ts an; powers o< t6e 86argee are not ;er:,e; <rom su86 estate s:n8e none :s ,este; :n 6:m an; so 6:s r:g6ts an; powers must <low <rom t6e rele,ant pro,:s:ons o< t6e NL) w:t6 t6e 86arge ta@:ng e<<e8t as a se8ur:ty onlyB en<or8ea7le 7y pro8ee;:ngs :n 8ourt to o7ta:n a Cu;:8:al sale 'see p 117I*= %6e rele,ant pro,:s:ons o< t6e NL)B to w:tB ss 234.2?3 o< t6e NL) 8on<err:ng t6e r:g6ts upon 86argors a<orsesa:; are ;es:gne; <or t6e:r prote8t:on= In t6e 8ase o< lan; 6el; un;er Lan; O<<:8e t:tleB t6e <orm o< t:tle 8orrespon;:ng to Lan; O<<:8e t:tle or su7s:;:ary t:tleB t6e 86argee ma@es 6:s appl:8at:on <or or;er <or sale to t6e Lan; (;m:n:stratorB :n a88or;an8e w:t6 t6e pro8e;ure la:; ;own :n s 2?2 et seA o< t6e NL) an; t6ese are also ;es:gne; <or t6e prote8t:on o< t6e 86argor= Howe,erB :n 8ons:;er:ng su86 an appl:8at:onB t6e powers o< t6e Lan; (;m:n:strator are l:m:te;= %6usB any o7Ce8t:on as to t6e ,al:;:ty o< t6e 86arge must 7e ta@en 7e<ore t6e 8ourts <or :t :s no ;e<en8e :n t6e :nAu:ry 7e<ore t6e Lan; (;m:n:strator 'see p 122&.. #*= Not e,ery transa8t:on :n al:enate; lan; entere; :nto 7y a person or 7o;:es re<erre; to :n s 45 o< t6e NL) 8on<ers r:g6ts :n rem 7ut only su86 ;eal:ngs w6:86 <all w:t6:n t6e mean:ng an; am7:t o< t6e ;e<:n:t:on o< 9;eal:ng9 :n s 3 o< t6e NL)= It <ollows t6ere<ore 199. % /L0 05 at 0. t6at s 121 o< t6e (8t :s not an :n;epen;ent sour8e <or t6e 8reat:on o< an :nterest :n lan;= !ale 7y ;e7enture o< lan; 86arge; un;er t6e NL) :s now6ere pro,:;e; <or 7y statute= !e8t:on 121 o< t6e (8t appears to 6a,e 7een ena8te; w:t6out regar; to t6e ;:<<eren8es 7etween t6e $ngl:s6 law o< mortgages an; t6e statutory 86arge un;er t6e NL) 'see p 122#.."*= %6e pro,:s:ons o< t6e NL) as to t6e r:g6ts o< 86argors are ;es:gne; <or t6e:r prote8t:on an; 8oul; not 7e wa:,e; nor 8oul; t6e 86argor 8ontra8t 6:msel< out o< t6e NL)= It <ollowsB t6ere<oreB t6at no power o< sale 8oul; 7e 8on<erre; 7y a 86argor un;er t6e NL) on a 86argee 6:msel< 7y way o< a ;e7enture or power o< attorney or ot6erw:seB 7ut pro8ee;:ngs must 7e 7roug6t 7y t6e 86argee to o7ta:n a Cu;:8:al sale :n a88or;an8e w:t6 t6e pro8e;ure la:; ;own :n t6e NL)= In su86 8:r8umstan8esB any power o< sale w6:86 purports to 7e 8on<erre; on a 86argee 6:msel<B om:tt:ng all ment:on o< not:8e an; per:o;s o< ;e<aultB 7y a ;e7enture or power o< attorney an; t6e ne8ess:ty <or o7ta:n:ng a Cu;:8:al saleB woul; 7e :n,al:; an; :ne<<e8t:,e to ent:tle a pur86aser to 7e regar;e; as owner 'see p 125(..)*F 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 o,errule;= !e8t:on 22?'5* o< t6e NL) 8onta:ns an e>press pro,:s:on w6:86 states t6at t6e pro,:s:ons o< t6e NL) reAu:r:ng a ;eal:ng to 7e e<<e8te; :n t6e statutor:ly pres8r:7e; manner s6all not 9=== a<<e8t t6e 8ontra8tual operat:on o< any transa8t:on relat:ng to al:enate; lan; or any :nterest t6ere:n9= %6:s pro,:;es statutory aut6or:ty <or t6e l:7eral appl:8at:on o< eAu:ty w6ene,er t6ere :s a 7as:s <or t6at=

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It :sB 6owe,erB a 8on;:t:on pre8e;ent <or t6e appl:8at:on o< s 22?'5* t6at t6ere :s :n e>:sten8e a transa8t:on relat:ng to al:enate; lan; or an :nterest t6ere:n w6:86 :s ,al:; an; en<or8ea7le as a 8ontra8t= G6en t6e rele,ant pro,:s:ons o< t6e ;e7enture rel:e; upon 7y t6e <:rst respon;ent as 8on<err:ng upon :t a power to sell t6e lan;s were ,o:;B t6e 8on;:t:on pre8e;ent <or t6e appl:8at:on o< s 22?'5* was a7sent 'see pp 125I an; 124(..)*= %6e pro,:s:ons o< t6e NL) sett:ng out t6e r:g6ts an; reme;:es o< part:es un;er a statutory 86arge o,er lan; 8ompr:se; :n Pt HVI are e7hausti-e and e7clusi-e an; any attempt at 8ontra8t:ng out o< t6ose r:g6ts . unless e>pressly pro,:;e; <or :n t6e )o;e . woul; 7e ,o:; as 7e:ng 8ontrary to pu7l:8 pol:8y= %6ere<oreB t6e re8e:,ers an; managers were not ent:tle; to sell t6e 86arge; lan;s 7y ,:rtue o< t6e powers 8on<erre; upon t6em 7y t6e ;e7enture w:t6out ta@:ng pro8ee;:ngs un;er t6e NL) to o7ta:n a Cu;:8:al sale 'see p 124#..D*= !:n8e a 86arge ta@es e<<e8t as a se8ur:ty onlyB en<or8ea7le 7y pro8ee;:ngs :n 8ourt to o7ta:n a Cu;:8:al saleB :t <ollows t6at w:t6 t6e a;,ent o< l:Au:;at:onB any sale 7y t6e re8e:,ers an; managers o< t6e lan;s pursuant to t6e ;e7enture woul; 7e a purporte; sale 199. % /L0 05 at 0 o< property w6:86 7elonge; to t6e 7orrower 8ompany an; t6e appellant woul; reAu:re t6e appro,al o< t6e 8ourt un;er s 225 o< t6e (8t 'see p 12?#..$*F So"man - Da-id Samuel 8rusts Ltd /19710 1 (ll $R ?1? ;:st:ngu:s6e; an; 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 o,errule;= &e8ause a re8e:,er an; manager o< any part o< t6e un;erta@:ngs o< t6e 8orporat:on appo:nte; un;er a power 8onta:ne; :n any :nstrument :s an o<<:8er o< t6e 8orporat:on . an; all o<<:8ers o< a 8orporat:onB w6et6er past or presentB are o7l:ge; to ;el:,er up to t6e l:Au:;ator appo:nte; 7y t6e 8ourt or as 6e ;:re8tsE ':* all mo,ea7le an; :mmo,a7le property o< t6e 8orporat:on :n 6:s 8usto;y or un;er 6:s 8ontrolF or '::* all 7oo@s an; papers :n 6:s 8usto;y or 8ontrol 7elong:ng to t6e 8orporat:onB 7e:ng 7y law reAu:re; to ;el:,er up t6e same . t6e 8lear :mpl:8at:on :s t6at l:Au:;at:on ;oes not merely term:nate t6e agen8y o< a re8e:,er an; manager 7ut also 6:s powers on w:n;:ng upB s:n8e t6ere :s no estate <or t6e re8e:,er an; manager to a;m:n:ster 'see pp 12?I an; 127(..)*F 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 o,errule;= %6e only persons w6o may 7e ma;e respon;ents :n m:s<easan8e pro8ee;:ngs un;er s 523 o< t6e (8t are promotersB l:Au:;ators an; o<<:8ers= 9O<<:8er9 :n8lu;es 9a re8e:,er an; manager o< any part o< t6e un;erta@:ng o< t6e 8orporat:on appo:nte; un;er a power 8onta:ne; :n any :nstrument9B :e to say a pr:,ately.appo:nte; re8e:,er an; managerB 7ut ;oes not :n8lu;eB :nter al:aE ':* any re8e:,er w6o :s not also a managerF an; '::* any re8e:,er an; manager appo:nte; 7y t6e 8ourt or 8re;:tors= Or;ers may t6us 7e ma;e un;er s 523 o< t6e (8t aga:nst a pr:,ately. appo:nte; re8e:,er an; manager 'see p 127#..$*F 2 0ohnson ) Co &2uilders( Ltd9 +e '1933* 1 )6 ?54 ;:st:ngu:s6e;=

O*+,'%6e prayer :n t6e appl:8at:on 7y t6e re8e:,ers an; managers 9<or lea,e to sell t6e lan;s9 was not appropr:ate s:n8e :< t6ey were 8orre8t :n t6e:r 8ontent:on t6at t6e ;e7enture ;:; 8on<er aut6or:ty on t6em to sell t6e 86arge; lan;s an; to g:,e a ,al:; an; reg:stra7le t:tle to a pur86aserB no lea,e woul; 6a,e 7een reAu:re;= I<B on t6e ot6er 6an;B t6e ;e7enture ;:; not 8on<er upon t6em t6e reAu:s:te aut6or:ty to sell t6e lan;sB no lea,e 8oul; 7e g:,en= It was 7e8ause t6e re8e:,ers an; managers 6a; enterta:ne; some ;ou7t a7out t6e:r aut6or:ty un;er t6e ;e7enture to sell t6e lan;s t6at t6e appropr:ate prayer <or t6em to 6a,e :nserte; woul; 6a,e 7een <or a ;e8larat:on as to ent:tlement to sell t6e lan;s w:t6out resort:ng to pro8ee;:ngs un;er t6e NL) to o7ta:n a Cu;:8:al saleB an; to g:,e ,al:; an; reg:stra7le t:tle to t6e pur86aser 'see pp 113H..I an; 11?(*= 199. % /L0 05 at 09 B$.$/$ M$($%/+$ /011$-% Pem:nCamB se7ua6 syar:@at '9perayu9* a;ala6 tuan punya 7er;a<tar tana6.tana6 tertentu '9tana6 terse7ut9*= Perayu mela@sana@an ;ua ga;a:an '9ga;a:an terse7ut9* ;: 7awa6 Kanun %ana6 Negara 19?3 '9K%N9* atas

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tana6 terse7ut mem:6a@ @epa;a &an@ &um:putra 'M* &6; '9penentang9* 7ag: menCam:n @emu;a6an @ewangan yang ;:7er:@an @epa;a perayu= "a;a:an terse7ut ;:;a<tar@an ;: 7awa6 s 121 (@ta !yar:@at 19?3 '9(@ta terse7ut9*= $@oran :tuB perayu mela@sana@an satu surat:@atan ;e7entur mem:6a@ @epa;a penentang pertama 7ag: menCam:n pel7aga: @emu;a6an @ewangan '9;e7entur terse7ut9* yang mana perayu mewuCu;@an @e;ua.;ua ga;a:an tetap ;an ga;a:an terapung= #e7entur terse7ut ;:;a<tar@an menurut s 121 (@ta terse7ut= #e7entur terse7ut memperuntu@@anB antara la:nB agar penentang melant:@ pener:ma ;an pengurus ;an supaya mere@a mempunya: @uasa tertentu= Kemu;:annyaB per:st:wa tela6 7erla@u yang mana @uasa untu@ melant:@ pener:ma ;an pengurus ;: 7awa6 ;e7entur 7ole6 ;:la@sana@an= Pa;a 15 Ogos 1917B menurut @uasa.@uasa ;em:@:anB penentang tela6 melant:@ penentang @e;uaB @et:ga ;an @eempat se7aga: pener:ma ;an pengurus perayu '9pener:ma ;an pengurus9*= Ole6 @erana t:a;a peruntu@an nyata ;alam ;e7entur terse7ut yang melant:@ mere@a se7aga: wa@:l.wa@:l perayu ;an mere@a :ng:n menCual tana6 terse7ut tanpa perlu mengguna@an pros:;:ng K%N 7ag: memperole6: Cualan @e6a@:manB pener:ma ;an pengurus memo6on @epa;a Ma6@ama6 %:ngg: melalu: saman pemula untu@ @e7enaran menCual tana6 terse7ut '9permo6onan terse7ut9*= Pa;a 27 De7ruar: 1919B perayu mengalam: penyelesa:an ;an permo6onan ole6 pener:ma ;an pengurus ;:7anta6 ole6 penyelesa: '9penyelesa: terse7ut9*= #: ma6@ama6 7awa6 'l:6at /19950 2 MLJ 12?*B 6a@:m yang ar:< memutus@an 7a6awaE ':* pener:ma ;an pengurus 7er6a@ menCual tana6 terse7ut yang terta@lu@ @epa;a ga;a:an terse7utB tanpa mengam7:l pros:;:ng ;: 7awa6 K%N 7ag: memperole6: Cualan @e6a@:manF ;an '::* <a@ta 7a6awa sese7ua6 syar:@at tela6 ;:leta@@an ;alam penyelesa:an t:;a@ menCeCas@an 8agaran yang ;:pegang ole6 pener:ma ;an pengurusF se@urang.@urangnya t:;a@ se6:ngga s: p:utang 7er8agar tela6 ;:7ayar sepenu6nya= Ole6 :tuB s: p:utang 7er8agar 7ole6 melupus@an 8agaran.8agaran walaupun ta6u a@an penyelesa:an= Ha@:m per7:8araan seterusnya mengata@an 7a6awa pener:ma ;an pengurus 7er6a@ @epa;a apa yang ;:peruntu@@an ole6 ;e7entur= Penyelesa: terse7utB yang t:;a@ 7erpuas 6at: ;engan peng6a@:man ma6@ama6 7awa6B merayu= Peguam penentang pertama 7ergantung @epa;a s 22?'5* K%N yang memperuntu@@an 7a6awa peruntu@an K%N yang meng6en;a@: suatu urusn:aga ;:la@sana@an ;engan 8ara yang ;:syarat@an ;alam statut t:;a@ a@an mempengaru6: operas: @ontra@tual mana.mana transa@s: 7er@a:tan ;engan tana6 7er:m:l:@ atau apa. apa @epent:ngan 199. % /L0 05 at 10 ;alamnya= !oalan untu@ penentuan a;ala6 sama a;a 6a@:m yang ar:< a;ala6 7etul ;alam memutus@an se7aga:mana yang ;:7uatnya= D+20,0/3$4B mem7enar@an rayuanE '1* 2 #: 7awa6 ga;a:.CanC: 8ommon lawB 6a@ ;an @uasa pemegang ga;a:.CanC: ter;:r: ;ar:pa;a yang 7er@a:tan ;engan estet sa6 atau e@u:t: yang ;:leta@6a@ ;alamnya ;alam peranan se7aga: pemegang ga;a:.CanC:B mana@ala ;alam ga;a:an statutor: ;: 7awa6 K%NB 6a@ ;an @uasa pemegang ga;a:an t:;a@ 7erpun8a ;ar:pa;a estet ;em:@:an ole6 @erana t:a;a apa.apa yang ;:leta@6a@ ;alamnya ;an ole6 :tu 6a@ ;an @uasanya mest: ;atang ;ar:pa;a peruntu@an rele,an K%N ;an ga;a:an 7er@esan se7aga: satu 8agaran sa6aCaB yang 7ole6 ;:@uat@usa@an ole6 pros:;:ng ;alam ma6@ama6 7ag: men;apat@an Cualan @e6a@:man 'l:6at ms 117I*= '2* 2 Peruntu@an rele,an K%NB :a:tu ss 234.2?3 K%N yang mengurn:a@an 6a@ @e atas pengga;a: terse7ut ;:8:pta untu@ perl:n;ungan mere@a= #alam @es tana6 yang ;:pegang ;: 7awa6 6a@m:l:@ PeCa7at %ana6B 7entu@ 6a@m:l:@ yang seCaCar ;engan 6a@m:l:@ PeCa7at %ana6 atau 6a@m:l:@ su7s:;:ar:B pemegang ga;a:an mem7uat permo6onannya untu@ per:nta6 Cualan @epa;a Penta;7:r %ana6B menurut prose;ur yang ;:nyata@an ;alam s 2?2 et seA K%N ;an :n: Cuga ;:re@a untu@ perl:n;ungan pengga;a:= Galau 7aga:manapunB ;alam mempert:m7ang@an permo6onan ;em:@:anB @uasa Penta;7:r %ana6 a;ala6 ter6a;= Justeru :tuB se7arang 7anta6an @epa;a @esa6an ga;a:an mest:la6 ;:am7:l ;: ma6@ama6 @erana :a 7u@anla6 pem7elaan ;alam sesuatu s:asatan ;: 6a;apan Penta;7:r %ana6 'l:6at ms 122&..#*= '5* 2 &u@anla6 set:ap transa@s: ;alam tana6 7er:m:l:@ yang ;::@at ole6 seseorang atau 7a;an yang ;:ruCu@ ;alam s 45 K%N mengurn:a@an 6a@ :n rem tetap: 6anya urusn:aga yang ;:rang@um: ole6 ma@na ;an l:ng@ungan ta<s:ran 9urusn:aga9 ;alam s 3 K%N= In: 7erma@na 7a6awa s 121 (@ta

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terse7ut t:;a@ merupa@an suatu sum7er 7e7as untu@ @ewuCu;an @epent:ngan ;alam tana6= Jualan menerus: ;e7entur tana6 yang ;:ga;a:@an ;: 7awa6 K%N t:;a@ ;:peruntu@@an ;: mana. mana ole6 statut= !e@syen 121 (@ta terse7ut nampa@nya tela6 ;:gu7al@an tanpa mengen;a6@an per7eIaan ;: antara un;ang.un;ang ga;a:.CanC: Ingger:s ;an ga;a:an statutor: ;: 7awa6 K%N 'l:6at ms 122#.."*= Peruntu@an K%N 7er@enaan 6a@ pengga;a: ;:8:pta untu@ perl:n;ungan mere@a ;an t:;a@ 7ole6 ;:@etep:@anF pengga;a: sen;:r: Cuga t:;a@ 7ole6 meng:@at @ontra@ luar ;ar:pa;a K%N= Ole6 yang ;em:@:anB :n: 7erma@na 7a6awa t:a;a @uasa Cualan 7ole6 ;:@urn:a@an ole6 pengga;a: ;: 7awa6 K%N pa;a pemegang ga;a:an sen;:r: melalu: ;e7entur atau surat @uasa wa@:l atau se7al:@nyaB tetap: pros:;:ng mest: ;:7awa ole6 pemegang ga;a:an 7ag: memperole6: Cualan @e6a@:man menurut prose;ur yang ;:nyata@an ;alam K%N= #alam @ea;aan se;em:@:anB se7arang @uasa Cualan yang @ononnya untu@ ;:@urn:a@an atas pemegang 199. % /L0 05 at 11 ga;a:an sen;:r:B tanpa menye7ut not:s ;an Cang@amasa @e:ng@aranB melalu: satu ;e7entur atau surat @uasa wa@:l ;an @eperluan untu@ memperole6: Cualan @e6a@:manB a@an menCa;: ta@ sa6 ;an t:;a@ 7er@esan 7ag: mem7ole6@an pem7el: ;:anggap se7aga: pemunya 'l:6at ms 125(..)*F 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 ;:tola@= !e@syen 22?'5* K%N mengan;ung: peruntu@an nyata yang menyata@an 7a6awa peruntu@an K%N yang meng6en;a@: suatu urusn:aga ;:la@sana@an ;alam 8ara statutor: yang ;:syarat@an t:;a@ a@an 9=== mel:7at@an operas: @ontra@ mana.mana transa@s: yang 7er@a:tan ;engan tana6 7er:m:l:@ atau apa.apa @epent:ngan ;alamnya9= In: memperuntu@@an autor:t: statutor: 7ag: pema@a:an l:7eral e@u:t: ;: mana ter;apat asas untu@nya= Namun ;em:@:anB :a merupa@an satu syarat ter;a6ulu untu@ pema@a:an s 22?'5* 7a6awa ter;apat suatu transa@s: 7er6u7ung ;engan tana6 7er:m:l:@ atau @epent:ngan ;alamnya yang sa6 ;an 7ole6 ;:@uat@uasa@an se7aga: satu @ontra@= (pa7:la peruntu@an rele,an ;e7entur terse7ut yang penentang pertama 7ergantung @epa;a se7aga: mengurn:a@annya @uasa untu@ menCual tana6 terse7ut a;ala6 ter7atalB syarat ter;a6ulu untu@ pema@a:an s 22?'5* t:;a@ ;:;apat: 'l:6at ms 125I ;an 124(..)*= Peruntu@an K%N yang menyata@an 6a@ ;an reme;: p:6a@.p:6a@ ;: 7awa6 ga;a:an statutor: atas tana6 ;alam &a6 HVI a;ala6 leng,ap dan e,s,lusif ;an se7arang per8u7aan untu@ meng:@at @ontra@ luar ;ar:pa;a 6a@ :tu . mela:n@an ;:peruntu@@an se8ara nyata ;alam K%N . a;ala6 ta@ sa6 ;an melanggar pol:s: awam= Ole6 :tuB pener:ma ;an pengurus t:;a@ 7er6a@ menCual tana6 yang ;:ga;a:@an ;engan @uasa yang ;:@urn:a@an @epa;a mere@a ole6 ;e7entur terse7ut tanpa mengam7:l pros:;:ng ;: 7awa6 K%N 7ag: memperole6: suatu Cualan @e6a@:man 'l:6at ms 124#..D*= Ole6 @erana satu ga;a:an ;:@uat@uasa@an se7aga: 8agaran sa6aCaB yang 7ole6 ;:@uat@uasa@an ole6 pros:;:ng ;alam ma6@ama6 7ag: men;apat@an Cualan @e6a@:manB :n: 7erma@na 7a6awa ;engan @emun8ulan penyelesa:anB se7arang Cualan ole6 pener:ma ;an pengurus tana6 terse7ut menurut ;e7entur terse7ut a@an menCa;: Cualan 6arta yang ;:m:l:@ ole6 syar:@at pem:nCam ;an perayu a@an memerlu@an @elulusan ma6@ama6 ;: 7awa6 s 225 (@ta terse7ut 'l:6at ms 12?#..$*F So"man - Da-id Samuel 8rusts Ltd /19710 1 (ll $R ?1? ;:7eIa ;an 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 ;:tola@= Ole6 @erana pener:ma ;an pengurus mana.mana 7a6ag:an a@uCanC: per7a;anan yang ;:lant:@ ;: 7awa6 @uasa yang ter@an;ung ;alam mana.mana :nstrumen a;ala6 seorang pegawa: per7a;anan . ;an semua pegawa: per7a;ananB sama a;a yang ;a6ulu atau semasaB waC:7 meng6antar.sera6 @epa;a penyelesa: yang ;:lant:@ 199. % /L0 05 at 1% ole6 ma6@ama6 atau yang ;:ara6@annyaE ':* @esemua 6arta al:6 ;an 6arta ta@ al:6 per7a;anan ;alam Cagaannya atau ;: 7awa6 @awalannyaF atau '::* @esemua 7u@u ;an @ertas @epunyaan per7a;anan ;alam Cagaan atau @awalannyaB yang ;:@e6en;a@: menyera6 yang sama ;: s:s: un;ang.un;ang . :mpl:@as: yang Celas a;ala6 7a6awa penyelesa:an t:;a@ se@a;ar menamat@an agens: seorang pener:ma ;an pengurus tetap: Cuga @uasanya pa;a penggulunganB ole6 @erana t:a;a estet untu@ ;:ta;7:r@an ole6 pener:ma ;an pengurus 'l:6at ms 12?I ;an 127(..)*F 1nited

Page ?

/alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 ;:tola@= '9* 2 Orang yang 7ole6 ;:Ca;:@an penentang ;alam pros:;:ng m:s<easans ;: 7awa6 s 523 (@ta terse7ut 6anya a;ala6 penganCurB penyelesa: ;an pegawa:= 9Pegawa:9 termasu@ 9seorang pener:ma ;an pengurus mana.mana 7a6ag:an a@uCanC: per7a;anan yang ;:lant:@ ;: 7awa6 @uasa yang ter@an;ung ;alam mana.mana :nstrumen9B :a:tu seorang pener:ma ;an pengurus yang ;:lant:@ se8ara persen;:r:anB tetap: t:;a@ termasu@B antara la:nE ':* mana.mana pener:ma yang 7u@an Cuga seorang pengurusF ;an '::* mana.mana pener:ma ;an pengurus yang ;:lant:@ ole6 ma6@ama6 atau s: p:utang= Justeru :tuB per:nta6 7ole6 ;:7uat ;: 7awa6 s 523 (@ta terse7ut ter6a;ap seorang pener:ma ;an pengurus yang ;:lant:@ se8ara persen;:r:an 'l:6at ms 127#..$*F 2 0ohnson ) Co &2uilders( Ltd9 +e '1933* 1 )6 ?54 ;:7eIa= O*+,'Perm:ntaan ;alam permo6onan ole6 pener:ma ;an pengurus 9untu@ @e7enaran menCual tana6 terse7ut9 a;ala6 t:;a@ waCar ole6 @erana C:@a mere@a a;ala6 7etul ;alam 6uCa6 7a6awa ;e7entur terse7ut memang mengurn:a@an @uasa @e atas mere@a untu@ menCual tana6 yang ;:ga;a:@an ;an untu@ mem7er:@an satu 6a@m:l:@ yang sa6 ;an 7ole6 ;:;a<tar@an @epa;a pem7el:B t:a;a @e7enaran ;:perlu@an= !e7al:@nyaB C:@a ;e7entur terse7ut t:;a@ mengurn:a@an @uasa yang ;:perlu@an untu@ menCual tana6 terse7ut @e atas mere@aB t:a;a @e7enaran 7ole6 ;:7er:@an= Ole6 @erana pener:ma ;an pengurus mempunya: @eraguan tentang @uasa mere@a ;: 7awa6 ;e7entur terse7ut untu@ menCual tana6 terse7utB perm:ntaan sesua: untu@ ;:masu@@an a;ala6 satu per:syt:6aran mengena: 6a@ menCual tana6 tanpa mengguna@an pros:;:ng K%N 7ag: memperole6: Cualan @e6a@:manB ;an untu@ mem7er:@an 6a@m:l:@ sa6 ;an 7ole6 ;:;a<tar@an @epa;a pem7el: 'l:6at ms 113H..I ;an 11?(*= N5,'/ Dor 8ases on 86arges un;er 8ompany lawB see 5 Mallal9s #:gest '4t6 $;B 1994 Re:ssue* paras 55.32= Dor 8ases on ;e7enture un;er 8ompany lawB see 5 Mallal9s #:gest '4t6 $;B 1994 Re:ssue* paras 34.37= 199. % /L0 05 at Dor 8ases on r:g6ts o< 86argeeB see 1 Mallal9s #:gest '4t6 $;B 199? Re:ssue* paras 1347.1341= C$/'/ -'6'--') ,5 !merican :7press 6nternational 2an,ing Corp - 5urley /19130 5 (ll $R 3?4 're<;* 2 0ohnson ) Co &2uilders( Ltd9 +e /19330 1 )6 ?54 ';:st;* 2ritish :agle 6nternational !irlines Ltd - Compagnie Nationale !ir ;rance /19730 1 GLR 731 're<;* 2urton9 e7 p 1nion 2an, of !ustralia Ltd9 +e '1921* 27 VLR 457 're<;* Chartered 2an, - <ac,iri /aideen ) !nor /19?50 MLJ 27? 're<;* Cheng 5ang =uan ) 3rs - <erumahan ;arlim &<enang( Sdn 2hd ) 3rs /19950 5 MLJ 532 're<;* Chung >hia" 2an, Ltd - Lau !h ?en ) !nor /19190 2 MLJ 247 're<;* =osling - =as,ell /11970 () 373 're<;* =urpal Singh - >ananayer /197?0 2 MLJ 54 're<;* 5# 8aib - 6smail /19710 2 MLJ 5? 're<;* 6nter-Continental /ining Co Sdn 2hd - Societe Des :tains De 2ayas 8ud#uh /19740 1 MLJ 143 're<;* 0ohnson - /oreton /19710 5 (ll $R 57 're<;* >uala Lumpur ;inance 2hd - ?ap <oh >ian &8eo Si, ) !nor9 6nter-eners( /19920 1 MLJ 472 're<;* Lee >im Seng - !cme Canning Sdn 2hd /19770 2 MLJ 141 're<;* 1'

Page 7

/ ) 0 ;ro@en ;ood Sdn 2hd ) !nor - Siland Sdn 2hd ) !nor /19940 1 MLJ 294 're<;* /alaysia Credit ;inance 2hd - ?ap 5oc, Choon ) !nor /19190 1 MLJ 252 're<;* /ercantile 2an, Ltd - 3fficial !ssignee of the <roperty of 5o" 5an 8eh /19?90 2 MLJ 19? 're<;* /uniandy aAl 8hamba >aundan ) !nor - De-elopment ) Commercial 2an, 2hd ) !nor /199?0 1 MLJ 574 're<;* National 2an, of !ustralasia - 1nited 5and in 5and and 2and of 5ope Co '1179* 4 () 591 're<;* 3oi 2oon Leong ) 3rs - Citiban, N! /19140 1 MLJ 222 're<;* S:! 5ousing Corp Sdn 2hd - Lee <oh Choo /19120 2 MLJ 51 're<;* Smith - National 8rust /19120 43 )an !)R ?11 're<;* So"man - Da-id Samuel 8rusts Ltd /19710 1 (ll $R ?1? ';:st;* Suppiah - <onnampalam /19?50 MLJ 222 're<;* 8empleton ) 3rs - Lo" ?at 5oldings Sdn 2hd ) !nor /19950 1 MLJ 445 're<;* 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd &6n li4uidation( ) !nor /191?0 1 MLJ 73 'o,er;* ?ong 8ong 5ong - Sie" Soon $ah ) 3rs /19710 2 MLJ 123 're<;* L'7+/($,+54 -'6'--') ,5 )ompan:es (8t 19?3 ss 4'1*'7*B 121B 225B 522'1*B '1*'7*':*B '::*B 523 199. % /L0 05 at Powers o< (ttorney Or;:nan8e 1949 ss 4B ?'1* )ompan:es (8t 1941 ss 227B 555 / K0 Lan; %rans<er (8t 1192 s 229 /(us0 A22'$( 6-51 Or:g:nat:ng !ummons No #5.51.193.11 'H:g6 )ourtB Kuala Lumpur* Cecil !braham &+abindra S Nathan9 <aul 3ng and >enny Ng "ith him( &<aul 3ng ) !ssociates( <or t6e appellant= 8 8homas &Sitpah Sel-aratnam "ith him( &S,rine ) Co( <or t6e respon;ent= EDGAR JOSEPH JR FCJ %6e (ppellant '9t6e &orrower )ompany9* :s t6e reg:stere; propr:etor o< 8erta:n lan;s 8ompr:se; :n H! '#* 11217 P%# 12?12 to H! '#* 11223 P%# 12?11B H! '#* 1122? P%# 12?92 to H! '#* 11525 P%# 12917B H! '#* 11524 P%# 12919 to H! '#* 11542 P%# 15223 :n t6e Mu@:m !:mpang Kanan :n t6e ;:str:8t o< &atu Pa6atB Jo6or '9t6e lan;s9*= In !eptem7er 1912B t6e &orrower )ompany e>e8ute; a <:rst legal 86arge un;er t6e Nat:onal Lan; )o;e 19?3 '9t6e )o;e9* o,er t6e lan;s :n <a,our o< &an@ &um:putra 'M* &6;B t6e <:rst respon;ent '9t6e &an@9* to se8ure 7an@:ng <a8:l:t:es grante; to t6e &orrower )ompanyB 7ear:ng presentat:on No 17157/12 Vol 73? Dol:o 29 an; reg:stere; on 11 !eptem7er 1912 '9t6e D:rst !tatutory )6arge9*= !:m:larlyB :n June 1913B t6e &orrower )ompany e>e8ute; a se8on; legal 86arge un;er t6e )o;e o,er some o< t6e lan;s . namelyB H! '#* 11523 P%# 12992 to H! '#* 11542 P%# 15223 . :n <a,our o< t6e &an@ to 1* Nat:onal Lan; )o;e 19?3 ss 3B 45B 22?B 234B 233B 237B 231B 239B 2??'1*

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se8ure 7an@:ng <a8:l:t:es grante; to t6e &orrower )ompanyB 7ear:ng presentat:on No ??31/13 Vol 157? Dol:o 12 an; reg:stere; on 52 June 1913 '9t6e !e8on; !tatutory )6arge9*= %6e D:rst an; t6e !e8on; !tatutory )6arges were ;uly reg:stere; un;er s 121 o< t6e )ompan:es (8t 19?3 '9t6e (8t9*= On 29 June 1913B t6e &orrower )ompany e>e8ute; a ;ee; o< ;e7enture :n <a,our o< t6e &an@ to se8ure ,ar:ous 7an@:ng <a8:l:t:es '9t6e #e7enture9* w6ere7y t6e &orrower )ompany 8reate;E '1* 5 a <:>e; 86arge o,er all :ts plantB eAu:pmentB ma86:neryB motor ,e6:8les w:t6 :ts a88essor:es an; parts perta:n:ng t6eretoF an; '2* 5 a <:rst <loat:ng 86arge o,erB :nter al:aB all :ts un;erta@:ngsB propert:es an; assets 7ot6 mo,ea7le an; :mmo,a7le= %6e pro,:s:ons o< t6e #e7entureB so <ar as rele,ant to t6:s appealB were t6eseE ':* 1 at any t:me a<ter t6e money t6ere7y se8ure; s6all 6a,e 7e8ome repaya7leE 1= t6e &an@ or any aut6or:Ie; person may enter :nto an; upon any lan; or prem:ses w6ere t6e propert:es or assets o< t6e 8ompany t6ere7y 86arge; are an; may ta@e possess:on an; 8ontrol t6ereo< 's 1=25*F an; 199. % /L0 05 at 15 1= t6e &an@ may appo:nt any persons to 7e t6e Re8e:,ers an; Managers o< t6e propert:es t6ere7y 86arge; to :t 's 1=25'8**= 3 '::* 1 t6e Re8e:,ers an; Managers appo:nte; 7y t6e &an@ s6all 6a,e powerB :nter al:aE 2= to ta@e possess:on o< or 8olle8t an; get :n all t6e propert:es or assets 86arge; un;er t6e #e7entureF 2= to 8arry onB manage or 8on8ur :n 8arry:ng on or manag:ng t6e 8ompany9s 7us:nessF 1= to sell or 8on8ur :n sell:ng any o< t6e assets or propert:es o< t6e 8ompany t6ere7y 86arge; at su86 pr:8e as t6ey :n t6e:r a7solute ;:s8ret:on s6all t6:n@ <:tB 6a,:ng regar; to t6e ,:ews an; ;es:res o< t6e &an@F an; 1= to ;o all su86 ot6er reasona7le a8ts an; t6:ngs as may 7e 8ons:;ere; to 7e :n8:;ental or 8on;u8:,e to any o< t6e matters or powers 8onta:ne; :n t6e ;e7enture an; w6:86 t6e Re8e:,ers an; Managers may law<ully ;o as agents o< t6e 8ompany 's 1=24*F ? ':::* 1 t6e &an@ may at any t:me a<ter t6e money t6ere7y se8ure; s6all 6a,e 7e8ome paya7le e<<e8t t6e sale o< any o< t6e propert:es o< w6:86 :t ta@es possess:on an; t6e 8ompany s6all ;o all t6:ngs ne8essary to ena7le t6e &an@ to 8omplete any su86 sale 's 12=27*= %6e #e7enture was ;uly reg:stere; pursuant to s 121 o< t6e (8t= $,ents 6a,:ng o88urre; upon w6:86 t6e powers to appo:nt re8e:,ers an; managers un;er t6e #e7enture 7e8ame e>er8:sa7leB on 15 (ugust 1917B t6e &an@ . pursuant to su86 powers . ;uly appo:nte; t6e !e8on;B %6:r; an; Dourt6 Respon;ents as Re8e:,ers an; Managers o< t6e &orrower )ompany '9t6e Re8e:,ers an; Managers9*= In t6ese 8:r8umstan8esB t6e Re8e:,ers an; Managers . re8ogn:I:ng t6at t6ere was no e>press pro,:s:on :n t6e #e7enture appo:nt:ng t6em as attorneys o< t6e &orrower )ompany an; 7e:ng ;es:rous o< sell:ng t6e lan;s w:t6out resort:ng to pro8ee;:ngs un;er t6e )o;e to o7ta:n a Cu;:8:al sale . 86ose to apply to t6e H:g6 )ourt 7y way o< Or:g:nat:ng !ummons :ssue; on 1 O8to7er 1911 9<or lea,e to sell t6e lan;s9= On 27 De7ruary 1919B t6e &orrower )ompany went :nto l:Au:;at:on an; t6e appl:8at:on 7y t6e Re8e:,ers an; Managers was oppose; 7y t6e l:Au:;ator '9t6e L:Au:;ator9*= (t t6e outsetB we s6oul; l:@e to po:nt out t6at t6e prayer :n t6e appl:8at:on 7y t6e Re8e:,ers an; Managers 9<or lea,e to sell t6e lan;s9 was not appropr:ate s:n8e :< t6ey were 8orre8t :n t6e:r 8ontent:on t6at t6e #e7enture ;:; 8on<er aut6or:ty on t6em to sell t6e 86arge; lan;s an; to g:,e a ,al:; an; reg:stra7le t:tle to a pur86aserB no lea,e woul; 6a,e 7een reAu:re;= I<B on t6e ot6er 6an;B t6e #e7enture ;:; not 8on<er upon t6em t6e reAu:s:te aut6or:ty to sell t6e lan;sB no lea,e 8oul; 7e g:,en= It was 7e8ause t6e Re8e:,ers an; Managers

Page 9

6a; enterta:ne; some ;ou7t a7out t6e:r aut6or:ty un;er t6e #e7enture to sell t6e lan;s t6at t6e appropr:ate prayer <or t6em to 6a,e :nserte; woul; 6a,e 7een <or a ;e8larat:on as to 199. % /L0 05 at 16 ent:tlement to sell t6e lan;s w:t6out resort:ng to pro8ee;:ngs un;er t6e )o;e to o7ta:n a Cu;:8:al saleB an; to g:,e ,al:; an; reg:stra7le t:tle to t6e pur86aser= Ha,:ng sa:; t6atB we must a;; t6at t6:s po:nt a7out t6e <orm o< t6e prayer was not ta@en e:t6er :n t6e 8ourt 7elow or 7e<ore usB an; t6e appeal was argue; on t6e 7as:s o< t6e appropr:ate prayers= In t6ese 8:r8umstan8esB we 8ons:;er t6at t6:s appeal s6oul; 7e ;e8:;e; on t6e same 7as:s an; so we nee; say not6:ng more a7out t6:s po:nt= In t6e )ourt 7elowB t6e learne; Cu;ge 6el; t6atE ':* 7y ,:rtue o< t6e powers 8on<erre; upon t6em 7y t6e #e7entureB t6e Re8e:,ers an; Managers were ent:tle; to sell t6e lan;s w6:86 were su7Ce8t to t6e D:rst an; !e8on; !tatutory )6arges w:t6out ta@:ng pro8ee;:ngs un;er t6e )o;e to o7ta:n a Cu;:8:al saleF an; '::* t6e <a8t t6at a 8ompany 6as 7een put :nto l:Au:;at:on ;oes not a<<e8t t6e se8ur:t:es 6el; 7y t6e re8e:,ers an; managersF at leastB not unt:l t6e se8ure; 8re;:tor 6as 7een <ully pa:; o<<= %6e se8ure; 8re;:tors 8oul; ;:spose o< t6e se8ur:t:es ;esp:te t6e l:Au:;at:on= He <urt6er sa:; t6at t6e Re8e:,ers an; Managers were ent:tle; to ;o w6at t6e #e7enture ent:tle; t6em to ;o 'see /19950 2 MLJ 12?*= In ;e8:;:ng as 6e ;:;B t6e learne; Cu;ge rel:e; 6ea,:ly on t6e Cu;gment o< t6e H:g6 )ourt at Jo6or &a6ru :n 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd /191?0 1 MLJ 73B w6ere t6e <a8ts 7ore a strong resem7lan8e to t6e present 8ase= In 6ol;:ng as :t ;:;B t6e H:g6 )ourt at Jo6or &a6ruB a<ter re<err:ng to t6e r:,al su7m:ss:ons o< 8ounselB sa:; t6:s 'at p 12*E
%6e power to sell un;er t6e ;e7enture ar:ses 7y ,:rtue o< t6e 8ontra8tual pro,:s:ons o< t6e ;e7enture :tsel<= In t6:s 8aseB 8l 12 o< t6e ;e7enture :s rele,ant= !o :s s 22?'5* o< t6e )o;e w6:86 e>pressly reser,es t6e 8ontra8tual operat:on o< any transa8t:on relat:ng to al:enat:ng lan;=

(n; <urt6er ;ownB t6e H:g6 )ourt at Jo6or &a6ru sa:; t6:sE
Here t6e 7an@ 6as t6e :ssue ;o8ument o< t:tle an; all t6at :s reAu:re; to 8onsummate t6e sale :s a ,al:; reg:stra7le trans<er o< t6e property= In t6e 8:r8umstan8es o< t6:s 8aseB t6:s o7Ce8t:,e 8an 7e eas:ly a86:e,e; 7y ma@:ng an or;er t6at t6e 7an@ an;/or t6e re8e:,er 7e ent:tle; to reAu:re t6e reg:strar o< t6:s 8ourt to e>e8ute on 7e6al< o< t6e 8ompany any trans<er w6:86 t6e 7an@ an;/or t6e re8e:,er may presentB su7Ce8t to t6e name o< t6e trans<eree an; t6e 8ons:;erat:on <or t6e sale 7e:ng ;uly state; t6ere:n= ( <urt6er or;er 8anB :< nee; 7eB 7e ma;e ;:re8t:ng t6e Reg:strar o< %:tles to reg:ster t6e trans<er :n <a,our o< t6e pur86aser= In ot6er wor;sB t6e same pro8e;ure woul; 7e <ollowe; as :< t6e sale 6a; 7een 8on;u8te; 7y t6e 8ourt=

(n; ;eal:ng w:t6 t6e :mpa8t o< l:Au:;at:on upon t6e powers o< t6e re8e:,er an; manager t6ereB t6e H:g6 )ourt at Jo6or &a6ru sa:; t6:s 'at p 11*E
Mr Ong9s ne>t su7m:ss:on :s t6at upon t6e 8ommen8ement o< t6e l:Au:;at:on ':eB t6e ;ate o< t6e presentat:on o< t6e pet:t:on . see s 219'2* o< t6e (8t*B t6e agen8y o< t6e re8e:,er <or t6e 8ompany 8ame to an en;= &ut a 8lear ;:st:n8t:on must 7e ;rawn 7etween t6e term:nat:on o< t6e agen8y an; t6e sur,:,al o< t6e powers o< t6e ;e7enture 6ol;erB w6:86 :n my ,:ew o< t6e lawB trans8en; an; e>:st :n;epen;ently o< t6e l:Au:;at:on=

%6e L:Au:;atorB 7e:ng ;:ssat:s<:e; w:t6 t6e Cu;gment o< t6e )ourt 7elowB 6a; 8ause; t6e present appeal to 7e 7roug6t= 199. % /L0 05 at 1. &roa;ly state;B t6e Auest:on <or ;e8:s:on :n t6e present appeal :s w6et6er t6e learne; Cu;ge was r:g6t :n 6ol;:ng as 6e ;:; on both po:nts o< law 6ere:n7e<ore ment:one;= &e<ore usB t6e 7as:8 8ontent:on o< )ounsel <or t6e &an@ :s t6at t6e spe8:al agreement 8onta:ne; :n t6e #e7enture 8on<erre; on t6e &an@ a 8on,ent:onal power o< sale e>er8:sa7le :n;epen;ently o< t6e pro,:s:ons o< t6e rele,ant pro,:s:ons o< t6e )o;e= In 8ons:;er:ng t6:s argumentB :t :s ne8essary to e>am:ne t6e nature an; 86ara8ter:st:8s o< a 86arge un;er t6e )o;eB t6e r:g6ts an; powers :n8:;ental to su86 a se8ur:ty an; lastlyB w6et6er a stu;y o< t6e s86eme o< t6e rele,ant pro,:s:ons o< t6e )o;e s6ows t6at t6e leg:slature was ;eal:ng e7hausti-ely and e7clusi-ely w:t6 t6e powers o< t6e statutory 86argee to ;e<eat t6e 86argor9s t:tle as

Page 12

reg:stere; propr:etor or more part:8ularlyB w6et6er su86 a stu;y re,eals t6at t6e leg:slature :nten;e; t6at a 86argor 8an . 7y t6e :ntro;u8t:on o< apt an; su<<:8:ent wor;sB w6et6er :n an anne>ure to t6e 86arge un;er t6e )o;e or a ;e7enture . e<<e8t:,ely 8on<er upon 6:s 86argee a power o< sale :n a;;:t:onal to an; :n;epen;ent o< t6e powers 8on<erre; 7y t6e rele,ant pro,:s:ons o< t6e )o;eB an; e>er8:sa7le w:t6out t6e :nter,ent:on o< t6e 8ourtB t6us 7ypass:ng t6e ma86:nery e>pressly pro,:;e; 7y t6e )o;e :n t6at 7e6al<= %6e essent:al difference 7etween a )ommon Law mortgage an; a statutory 86arge un;er t6e )o;e may 7e ta@en <rom #ass :n 6:s ,alua7le wor@ on 8he 8orrens System in /alaya at p 429 paras 2 an; 5 w6ere 6e says t6:sE
In an $ngl:s6 mortgageB w6ere owners6:p :s trans<erre; unt:l t6e property mortgage; :s sol; 7y t6e mortgagee or <ore8lose; an; t6e sale 7e8omes a7soluteB t6e eAu:ty o< re;empt:on rema:ns w:t6 t6e mortgagor= !propos o< $ngl:s6 mortgage Lor; Ma8Nag6ten remar@e;B 9No one I am sureB 7y t6e l:g6t o< natureB e,er un;erstoo; an $ngl:s6 mortgage o< real estate9 'Samuel - 0arrah 8imber ) $ood <a-ing Corp Ltd /19240 () 525 at p 52?*= 9&y an :n;enture o< mortgageB t6e legal estate :s 8on,eye; to t6e mortgagee su7Ce8t to t6e 8on;:t:on t6at t6e mortgagee w:ll re8on,ey upon payment o< pr:n8:pal an; :nterest se8ure; 7y t6e ;ee;= %6oug6 reg:strat:on :s usual an; ;es:ra7le <or t6e prote8t:on o< t6e mortgageeB :t :s not essent:al to t6e ,al:;:ty o< t6e mortgage= $Au:ty 6asB 6owe,erB always regar;e; t6e mortgagee as ta@:ng only su86 an estate as was ne8essary <or t6e purpose o< t6e se8ur:ty9 '&e8@en6am an; Harr:sB 8he +eal <roperty !ct 'N!G*B p 151*= n;er t6e %orrens systemB t6ere :s no trans<er o< owners6:p o< lan; 7y statutory mortgage= %6e ;:st:n8t:on 7etween t6e power o< a statutory mortgagee :n pra8t:8ally e,ery %orrens leg:slat:onB :n8lu;:ng !:ngaporeB ' Lan; %:tles Or;:nan8eB ss 34 an; ?2F &aalmanB Singapore 8orrens SystemB pp 155B 141* an; o< a statutory 86argee :n t6e Malay !tates :s t6at :n t6e latter Cur:s;:8t:onB 9no power o< sale or <ore8losure :s 8on<erre; on t6e 86argee 6:msel<B 7ut pro8ee;:ngs must 7e ta@en to o7ta:n a Cu;:8:al sale9=

%o put :t anot6er wayB un;er t6e )ommon Law mortgageB t6e r:g6ts an; powers o< t6e mortgagee are t6ose w6:86 are :n8:;ental to t6e legal or eAu:ta7le estate ,este; :n 6:m :n 6:s role as mortgageeF "hereas un;er t6e statutory 86arge under the CodeB t6e r:g6ts an; powers o< t6e 86argee are not ;er:,e; <rom su86 estate s:n8e none :s ,este; :n 6:m an; so 6:s r:g6ts an; powers must <low <rom t6e rele,ant pro,:s:ons o< t6e )o;e w:t6 t6e 86arge ta@:ng e<<e8t as a se8ur:ty onlyB en<or8ea7le 7y pro8ee;:ngs :n 8ourt to o7ta:n a Cu;:8:al sale= 199. % /L0 05 at 1 %6e ne>t matter w6:86 8alls <or 8ons:;erat:on was w6et6er t6e s86eme o< t6e rele,ant pro,:s:ons o< t6e )o;e s6ows t6at t6e leg:slature was ;eal:ng e7hausti-ely and e7clusi-ely w:t6 t6e powers o< a statutory 86argee to ;e<eat t6e 86argor9s t:tle as reg:stere; propr:etor= %6:s top:8 reAu:res an e>am:nat:on o< t6e r:g6ts an; o7l:gat:ons o< 86argor an; 86argee :n8:;ental to a 86arge un;er t6e )o;e= )learlyB :n t6e e,ent o< pro8ee;:ngs 7e:ng 7roug6t un;er t6e )o;e to en<or8e a statutory 86arge o,er lan;B a 86argor possesses 8erta:n ,alua7le r:g6ts . none o< w6:86 :s possesse; 7y a 7orrower 8ompany un;er a ;e7enture :n 8ommon <orm= It :s not propose; to set out an e>6aust:,e l:st o< t6ese r:g6ts 7ut some o< t6e more o7,:ous ones may 7e note;= ;irstlyB upon a 7rea86 7y t6e 86argor o< any o< t6e agreements on 6:s part e>presse; or :mpl:e; :n t6e 86arge 8ont:nu:ng <or at least a mont6 or su86 alternat:,e per:o; as may 7e spe8:<:e; :n t6e 86argeB not:8e :n Dorm 1?# :s ser,e; spe8:<y:ng t6e 7rea86 an; reAu:r:ng t6e 86argor to reme;y t6e same w:t6:n a mont6 o< t6e ;ate o< t6e not:8e or su86 alternat:,e per:o; as may 7e spe8:<:e; :n t6e 86argeB w:t6 a warn:ng t6at :n t6e e,ent o< non.8ompl:an8eB pro8ee;:ngs to en<or8e t6e 86arge 7y o7ta:n:ng a Cu;:8:al sale w:ll 7e 8ommen8e; 's 234'1* o< t6e )o;e*= n;er t6:s pro,:s:onB t6ere w:ll generally 7e a t:me lag o< at least two mont6s 7etween t6e ;ate o< 7rea86 an; t6e 8ommen8ement o< pro8ee;:ngs :n 8ourt to en<or8e t6e 86arge= In t6e 8ase o< 86arges w6ere t6e pr:n8:pal :s paya7le on ;eman;B s 233'1* o< t6e )o;e pro,:;es an alternat:,e pro8e;ure 7y reAu:r:ng ser,:8e o< a not:8e :n Dorm 1?$B :mme;:ately upon su86 7rea86B reAu:r:ng :t to 7e reme;:e; w:t6:n a mont6 an; a;;:ng t6at :n t6e e,ent o< non.8ompl:an8eB pro8ee;:ngs to en<or8e t6e 86arge 7y o7ta:n:ng a Cu;:8:al sale may 7e <ort6w:t6 8ommen8e; w:t6out :t 7e:ng reAu:re; to ser,e a not:8e :n Dorm 1?# un;er s 234'1*= n;er t6:s pro,:s:onB t6ere w:ll 7e a t:me lag o< at least a mont6 7etween t6e ;ate o< 7rea86 an; t6e 8ommen8ement o< pro8ee;:ngs :n 8ourt to en<or8e t6e 86arge= It :s o7,:ous t6at t6e a;,antage o< t6e Not:8e reAu:rements un;er ss 234 an; 233 o< t6e )o;e :s t6at :t w:ll enta:l ;elayB t6us a<<or;:ng opportun:ty to t6e 86argor to 7ustle a7out to ra:se t6e money to pay t6e ;eman;s= Non.8ompl:an8e w:t6 t6e not:8e reAu:rements w:ll ren;er a su7seAuent or;er <or sale l:a7le to 7e set as:;e as

Page 11

7e:ng ,o:; an; o< no e<<e8t 'seeB eg /uniandy aAl 8hamba >aundan ) !nor - De-elopment ) Commercial 2an, 2hd ) !nor /199?0 1 MLJ 574*= SecondlyB pro8ee;:ngs <or sale ;:re8te; 7y t6e )o;e reAu:re Cu;:8:al :nter,ent:on= %6usB t6e 86argor w:ll 7e a88or;e; a 8erta:n measure o< prote8t:on s:n8e t6e Cu;ge w:ll 6a,e to 7e sat:s<:e; t6at t6e reAu:rements o< t6e )o;e 6a,e 7een sat:s<:e; 7e<ore ma@:ng an or;er <or sale= 8hirdlyB at t6e 6ear:ng o< pro8ee;:ngs ;:re8te; un;er t6e )o;eB t6e 86argor w:ll 6a,e t6e opportun:ty o< 9s6ow:ng 8ause to t6e 8ontrary9 w:t6:n t6e mean:ng o< s 234 o< t6e )o;eF :n ot6er wor;sB t6e r:g6t to 7e 6ear;= Moreo,erB as po:nte; out 7y Gan Ja6ya !)J :n / ) 0 ;ro@en ;ood Sdn 2hd ) !nor - Siland Sdn 2hd ) !nor /19940 1 MLJ 294 at p 511&E
n;er ss 231 an; 2?1B t6e 86argor :s not only g:,en t6e opportun:ty to s6ow 8ause as to w6y 6:s property s6oul; not 7e sol; 7ut also to part:8:pate :n t6e 199. % /L0 05 at 19 ;el:7erat:on on matters a<<e8t:ng 6:s :nterestB su86 as t6e reser,e pr:8eB t6e t:meB ,enue an; 8on;:t:ons o< sale=

;ourthlyB 7y reason o< s 237 o< t6e )o;eB t6e terms to 7e :nserte; :n t6e or;er <or sale must :n8lu;e a sale 7y pu7l:8 au8t:on on an as8erta:ne; ;ate not less t6an a mont6 <rom t6e ;ate o< t6e or;er an; at a reser,e pr:8e <:>e; 7y t6e Reg:strar o< t6e )ourt an; t6e total sum paya7le un;er t6e 86arge at t6e ;ate o< t6e or;er= %6e 8on;:t:ons o< sale are usually pro,:;e; <or :n t6e rele,ant state 8on;:t:ons o< sale= ;ifthlyB t6e 86argor 6as a r:g6t to 7e ser,e; w:t6 a 8opy o< t6e Or;er <or !aleB <or t6e sale to 7e a;,ert:se; an; t6ere :s an o7l:gat:on rest:ng on t6e 86argee to prepare t6e 8on;:t:ons o< sale an; to ;el:,er to 8ourt t6e :ssue ;o8ument o< t:tle 'see s 231 o< t6e )o;e*= Si7thlyB t6e 86argor 6as t6e a;,antage o< t6e sale 7e:ng e<<e8te; un;er t6e ;:re8t:on o< an o<<:8er o< t6e 8ourt w6o may see@ t6e ass:stan8e o< a l:8ense; au8t:oneer 'see s 239 o< t6e )o;e*= Se-enthlyB 7y ,:rtue o< s 2??'1* o< t6e )o;eB a 86argor aga:nst w6om an or;er <or sale 6as 7een ma;e 6as t6e r:g6tB at any t:me 7e<ore t6e sale 6as 7een 8on8lu;e; . t6:s :s to sayB 7e<ore t6e <all o< t6e 6ammer . to stop t6e sale 7y ten;er:ng t6e total sum ;ue un;er t6e 86argeB :n8lu;:ng a88rue; :nterest an; t6e usual e>pensesB to t6e Reg:strar o< t6e 8ourt . orB as t6e 8ase may 7eB to t6e Lan; (;m:n:strator . an; t6ereuponB t6e or;er <or sale s6all 8ease to 6a,e e<<e8t= In su86 a s:tuat:onB t6e 86argor s6all 7e ent:tle; to a ;:s86arge o< 86arge an; return o< t6e :ssue ;o8ument o< t:tle= %6:s 7r:ngs us to Chartered 2an, - <ac,iri /aideen ) !nor /19?50 MLJ 27?B w6ere:n ":ll J 'as 6e t6en was* 6el; t6at on8e a 86arge a8t:on <or an or;er <or sale 6as 7een 8ommen8e;B t6e 86arge; lan; 6a; to 7e sol; 7y pu7l:8 au8t:on= %6:s ;e8:s:on :s open to some Cust:<:a7le 8r:t:8:smE s 2??'1* o< t6e )o;e pro,:;es t6at a 86argor aga:nst w6om an or;er <or sale 6as 7een ma;e mayB at any t:me 7e<ore t6e 8on8lus:on o< t6e saleB stop t6e sale 7y ten;er:ng t6e amounts spe8:<:e; :n s 2??'2* an; t6us 7e ent:tle; to a ;:s86arge o< 86arge an; return o< t6e :ssue ;o8ument o< t:tle= I< a 86argor 8anB at su86 a late stageB 7e ent:tle; to a ;:s86argeB as a matter o< log:8 an; spea@:ng generallyB t6ere appears to 7e no reason w6y at an earl:er stageB a 86argor9s appl:8at:on to sell t6e 86arge; lan; 7y pr:,ate treaty so as to ena7le 6:m to e>er8:se 6:s r:g6t o< ;:s86arge s6oul; 7e re<use; s:mply 7e8ause pro8ee;:ngs <or an or;er <or sale 6a,e 7een 8ommen8e;= :ighthlyB w6ere a pur86aser at t6e Cu;:8:al sale ;oes not 8omplete t6e 8ontra8t on t6e ;ue ;ate an; see@s an e>tens:on o< t:me to pay t6e 7alan8e o< t6e pur86ase pr:8eB 6e must apply to 8ourt <or su86 e>tens:onB :n w6:86 e,ent t6e 86argor 6as a r:g6t to 7e 6ear; an; a ;en:al t6ereo< w:ll ren;er any reg:strat:on o< t6e sale pro8ure; t6ere7y null an; ,o:; as 7e:ng ultra ,:res t6e powers o< t6e )o;e 'see / ) 0 ;ro@en ;ood Sdn 2hd - Siland Sdn 2hd ) !nor /19940 1 MLJ 294 '!)**= NinthlyB a 86argor 6as a r:g6t to an or;er sett:ng as:;e a Cu;:8:al sale o< lan; su7Ce8t to a statutory 86arge 'e,en t6oug6 at su86 a saleB t6e 86argee :s t6e ,en;or 7e8ause t6e 86argor a7;:8ates 6:s r:g6ts as t6e reg:stere; owner o< t6e lan; :n <a,our o< t6e 86argee* :< 6e 8an esta7l:s6 t6at t6e sale 6a; 7een 8on;u8te; <rau;ulentlyB 8ollus:,ely or :mproperly to 199. % /L0 05 at %0 t6e preCu;:8e o< t6e 86argor 'see >uala Lumpur ;inance 2hd - ?ap <oh >ian &8eo Si, ) !nor9 6nter-eners( /19920 1 MLJ 472*= In t6at 8aseB L:m &eng )6oon J 6el; t6at ne:t6er t6e Reg:strar nor t6e au8t:oneer 6a; any

Page 12

:nterest :n t6e saleB an; t6at 7e:ng soB t6e Reg:strar 6a; no power to grant an e>tens:on o< t:me <or payment o< t6e 7alan8e o< t6e pur86ase pr:8e 7y t6e :nter,eners/pur86asers w:t6out t6e 8onsent o< t6e 86argee= It :s o7,:ous t6at t6e rele,ant port:ons o< t6e )o;e . to w:tB ss 234.2?3 . 8on<err:ng t6e r:g6ts upon 86argors a<oresa:; are ;es:gne; <or t6e:r prote8t:on= In t6e 8ase o< lan; 6el; un;er a Lan; O<<:8e t:tleB t6e <orm o< t:tle 8orrespon;:ng to Lan; O<<:8e t:tle or su7s:;:ary t:tleB t6e 86argee ma@es 6:s appl:8at:on <or or;er <or sale to t6e Lan; (;m:n:strator :n a88or;an8e w:t6 t6e pro8e;ure la:; ;own :n s 2?2 et seA o< t6e )o;e an; t6ese are also ;es:gne; <or t6e prote8t:on o< t6e 86argor= Howe,erB :n 8ons:;er:ng su86 an appl:8at:onB t6e powers o< t6e Lan; (;m:n:strator are l:m:te; 'seeB egB =urpal Singh - >ananayer /197?0 2 MLJ 54 at p 5?*= %6usB any o7Ce8t:on as to t6e ,al:;:ty o< t6e 86arge must 7e ta@en 7e<ore t6e 8ourts <or :t :s no ;e<en8e :n t6e :nAu:ry 7e<ore t6e Lan; (;m:n:strator 'see Suppiah - <onnampalam /19?50 MLJ 222 at p 224*= It :s eAually o7,:ous t6at :t :s not e,ery transa8t:on :n al:enate; lan; entere; :nto 7y a person or 7o;:es re<erre; to :n s 45 o< t6e )o;e w6:86 8on<ers r:g6ts:n rem 7ut only su86 ;eal:ngs as 8ome w:t6:n t6e mean:ng an; am7:t o< s 3 o< t6e )o;e w6:86 pro,:;esE
9;eal:ng9 means any transa8t:on w:t6 respe8t to al:enate; lan; e<<e8te; un;er t6e powers 8on<erre; 7y #:,:s:on IVB an; any l:@e transa8t:on e<<e8te; un;er t6e pro,:s:ons o< any pre,:ous lan; lawB 7ut ;oes not :n8lu;e any 8a,eat or pro6:7:tory or;erF ====

It <ollows t6at s 121 o< t6e (8t :s not an :n;epen;ent sour8e <or t6e 8reat:on o< an :nterest :n lan;= !ale 7y ;e7enture o< lan; 86arge; un;er t6e )o;e :s now6ere pro,:;e; <or 7y statute= !e8t:on 121 appears to 6a,e 7een ena8te; w:t6out regar; to t6e ;:<<eren8e 7etween t6e $ngl:s6 law o< mortgages an; t6e statutory 86arge un;er t6e )o;e= %6e Auest:on w6et6er a person ent:tle; to t6e per<orman8e o< a statutory ;uty 8an e<<e8t:,ely wa:,e per<orman8e o< t6e ;uty 7y t6e person 7oun; an; t6e latter 8an e<<e8t:,ely 8ontra8t out o< per<orm:ng t6e ;utyB ;epen;s on t6e language o< t6e part:8ular statute an;B :< t6:s :s not 8learB on t6e o,erall purpose o< t6e statute an; w6et6er t6:s purpose woul; 7e ;e<eate; 7y perm:tt:ng wa:,er an; 8ontra8t:ng out= 8rietel on Contract 'at p 712* 6as 8orre8tly po:nte; outE
#:<<:8ult Auest:ons 8an ar:se w6ere a person attempts 7y 8ontra8t to wa:,e a r:g6t 8on<erre; on 6:m 7y statute= (lt6oug6 t6ere :s a general pr:n8:ple t6at a person may wa:,e any r:g6t 8on<erre; on 6:m 7y statute '4uilibet potest renunciare #uri pro se introducto*B ;:<<:8ult:es ar:se :n ;eterm:n:ng w6et6er t6e r:g6t :s e>8lus:,ely personal or :s ;es:gne; to ser,e ot6er more 7roa; pu7l:8 purposes= In t6e latter s:tuat:onB pu7l:8 pol:8y woul; reAu:re t6at t6e r:g6t 7e treate; as man;atory an; not 7e wa:,a7le 7y t6e party <or w6ose 7ene<:t :t operates= G6et6er a statutory r:g6t :s wa:,a7le ;epen;s on t6e o,erall purpose o< t6e statute an; w6et6er t6:s purpose woul; 7e <rustrate; 7y perm:tt:ng wa:,er= 199. % /L0 05 at %1

%urn:ng to 8ase lawB on t6e su7Ce8t o< w6en contracting out o< a statute may or may not 7e perm:tte;B 0ohnson - /oreton /19710 5 (ll $R 57B S:! 5ousing Corp Sdn 2hd - Lee <oh Choo /19120 2 MLJ 51F 3oi 2oon Leong ) 3rs - Citiban, N! /19140 1 MLJ 222F 2ritish :agle 6nternational !irlines Ltd - Compagnie Nationale !ir ;rance /19730 1 GLR 731F Lee >im Seng - !cme Canning Sdn 2hd /19770 2 MLJ 141 an; 5# 8aib - 6smail /19710 2 MLJ 5? may 7e rea; w:t6 pro<:t= &utB most part:8ularlyB t6ere are at least two (ustral:an 8ases w6:86 s6ow t6at a 8lause :n a mortgage to ;epr:,e a mortgagor o< 6:s r:g6t to 6a,e a not:8e o< ;eman; ser,e; upon 6:m a<ter 6e :s :n ;e<ault as a ne8essary prel:m:nary step to a sale un;er t6e rele,ant V:8tor:an leg:slat:on woul; 7e :n,al:;= I re<er to National 2an, of !ustralasia - 1nited 5and in 5and and 2and of 5ope Co '1179* 4 () 591 an; +e 2urton9 e7 p 1nion 2an, of !ustralia Ltd '1921* 27 VLR 457= In National 2an, of !ustralasia9s 8aseB t6e spe8:al 8lause :n t6e :nstrument o< mortgage was to t6e e<<e8t t6at notw:t6stan;:ng anyt6:ng 8onta:ne; :n t6e Lan; %rans<er (8tB :t s6oul; 7e law<ul <or t6e 7an@B :n t6e e,ent o< ;e<ault 7e:ng ma;e :n t6e payment o< t6e pr:n8:pal money an; :nterest se8ure; :mme;:ately to ser,e not:8e o< ;eman; an;B a<ter t6e e>p:rat:on o< 14 ;ays <rom t6e ser,:8e o< t6e not:8e o< ;eman;B to sell t6e lan;s :n pursuan8e o< t6e powers :n t6at 7e6al< ,este; :n t6e mortgagee un;er t6e 13t6 se8t:on o< t6e statute= %6e 14t6 se8t:on pro,:;e; t6at :< t6e mortgagor s6all ma@e ;e<ault :n payment o< t6e pr:n8:pal sum or :nterestB an; su86 ;e<ault s6all 7e 8ont:nue; <or one mont6B or <or su86 ot6er per:o; o< t:me as may t6ere:n <or t6at purpose 7e e>pressly <:>e;B t6e mortgagee may ser,e on t6e mortgagorB :n t6e manner t6ere:n spe8:<:e;B

Page 15

not:8e :n wr:t:ng to pay t6e money ow:ng on t6e mortgage= %6e 13t6 se8t:on pro,:;e; t6at :< su86 ;e<ault s6all 8ont:nue <or a mont6 a<ter t6e ser,:8e o< su86 not:8eB or <or su86 ot6er per:o; as may :n su86 mortgage 7e <or t6at purpose <:>e;B t6e mortgagee may sell t6e lan;= It was argue; t6at t6e ;eman; ser,e; was t6e only not:8e o< ;eman; reAu:re; to 7e ser,e; to support a sale ma;e 14 ;ays a<ter t6:s ser,:8e :n pursuan8e o< t6e statutory power= %6e:r Lor;s6:ps ;:; not agree w:t6 t6:s 8ontent:on= %6ey 6el; t6at a ;eman; w:t6:n t6e mean:ng o< t6e statute was ne8essary :n or;er to <:> t6e t:me o< payment an; unt:l :ts ser,:8e t6ere 8oul; 7e no ;e<ault= %6e:r Lor;s6:ps o7ser,e; t6at t6e spe8:al 8lause :n t6e :nstrument o< mortgage Aual:<:e; t6e 14t6 se8t:on 7y allow:ng not:8e o< ;eman; to 7e ser,e; :mme;:ately :nstea; o< 9one mont69 a<ter ;e<aultB an; t6e 13t6 se8t:on 7y allow:ng t6e sale to 7e ma;e 14 ;ays :nstea; o< a mont6 a<ter ser,:8e o< su86 not:8e was :ne<<e8t:,e to ;epr:,e t6e mortgagor o< t6e r:g6t to 6a,e a not:8e o< ;eman; ser,e; upon 6:mB a<ter 6e :s :n ;e<aultB as a ne8essary prel:m:nary step to a sale un;er t6e statutory power= %6e:r Lor;s6:ps 8on8lu;e; t6:s part o< t6e 8ase 7y say:ng t6at :n t6e 8:r8umstan8es outl:ne;B upon an appl:8at:on to 8omplete t6e t:tle o< t6e pur86aser 7y reg:strat:on un;er t6e 17t6 se8t:on o< t6e (8tB an o7Ce8t:on on t6e groun; o< <a:lure to ser,e a proper not:8e o< ;eman; woul; pro7a7ly 6a,e 7een ta@en 7y t6e reg:strar= 199. % /L0 05 at %% In +e 2urtonB an :nstrument o< mortgage reg:stere; un;er t6e pro,:s:ons o< t6e Lan; %rans<er (8t 1192 8onta:ne; a 8o,enant <or payment on ;eman; :n wr:t:ng g:,en to or sent t6roug6 t6e post :n a prepa:; letter a;;resse; to t6e mortgagorB 6:s 6e:rsB e>e8utorsB a;m:n:strators or trans<erees= !u7seAuentlyB a trans<er o< t6e mortgage was reg:stere;= #e<ault :n payment o88urre;B an; not:8e o< sale un;er s 114 o< t6at (8t was ser,e; on t6e mortgagor 7y reg:stere; letter 7ut no ;eman; <or payment an; no not:8e un;er t6e se8t:on were ser,e; upon t6e trans<eree= In re<us:ng t6e appl:8at:on <or <ore8losureB t6e )omm:ss:oner o< %:tles sa:;B :nter al:aB t6:sE
!e8t:on 113 o< t6e (8t ;eals w:t6 mortgages w6:86 ma@e t6e money se8ure; paya7le on ;eman;B an; as ss 14 an; 13 o< t6e %rans<er o< Lan; !tatute 11??B No 521 '8orrespon;:ng to ss 114 an; 113 o< t6e Lan; %rans<er (8t 1192* reAu:re; ;e<aultB ;eman;B saleB an; t6e mortgage reAu:re; ;e<aultB ;eman;B saleB s 44 o< (8t 172 'now 7y 8onsol:;at:on s 113 o< t6e Lan; %rans<er (8t 1192* was passe; to ma@e t6e one not:8e an; t6e one ;e<ault su<<:8:entB an; a88ompl:s6e; t6:s 7y ma@:ng t6e ;eman; 9pursuant tO9 t6e mortgage eAu:,alent to t6e not:8e reAu:re; 7y s 114B 7ut s 113 ;oes not operate to ,ary t6e mo;e or ser,:8e o< not:8e pres8r:7e; 7y s 114 or to put :t :n t6e power o< part:es ;eal:ng w:t6 lan;s un;er t6e (8t to 8ontra8t t6emsel,es out o< t6e (8t an; e,a;e one o< t6e pr:n8:pal reAu:rements an; sa<eguar;sB namelyB t6at t6e reg:stere; propr:etor o< t6e lan; s6all 6a,e not:8e o< any propose; ;eal:ng w:t6 t6e lan; preCu;:8:al to 6:s t:tle= In t6:s 8aseB :< t6e mortgage 8on<erre; on t6e mortgagee t6e opt:on o< g:,:ng not:8e to t6e mortgagor w:t6out also g:,:ng not:8e to t6e trans<ereeB t6e reg:stere; propr:etor woul; :< a sale 6a; 7een e<<e8te; on 3 De7ruary 1921 6a,e 7een ;enu;e; o< 6:s t:tle w:t6out 6:s @nowle;ge an; w:t6out any opportun:ty o< e>er8:s:ng 6:s eAu:ty o< re;empt:on= %6at <a8t t6at t6e attempte; sale pro,e; a7ort:,eB an; t6at not:8e o< t6e mortgagee9s :ntent:on to apply <or a <ore8losure or;er was sent as allege; to t6e trans<ereeB ;oes not 8ure t6e want o< t6e 9;e<ault9====

On a summons un;er s 229 o< t6e Lan; %rans<er (8t 1192B 8all:ng upon t6e Reg:strar o< %:tles to s6ow w6y an or;er o< <ore8losure s6oul; not 7e :ssue; 7y 6:mB G:ll:ams J re<erre; t6e same to t6e Dull )ourt w6:86 6el; t6at <or t6e reasons state; :n t6e 8ourse o< t6e argumentB t6e )omm:ss:oner was r:g6tB an; t6at t6e summons s6oul; 7e ;:sm:sse;= In t6e 8ourse o< t6e argumentB Holroy; J sa:;B :nter al:aB t6:sE
%6e (8t 8ontrols t6e :nstrument o< mortgage= Jou 8annot ;raw up a mortgage so as to 8ontrol t6e (8t= %6e str:8test pro8e;ure :s :nten;e; to 7e <ollowe; :n regar; to <ore8losure=

%6ere :s also t6e ;e8:s:on o< t6e !upreme )ourt o< )ana;a :n Smith - National 8rust '1912* 43 )an !)R ?11 apply:ng t6e pr:n8:ple o< 8onstru8t:on w6:86 e>8lu;es t6e ,al:;:ty o< any power o< sale not aut6or:Ie; 7y t6e statutes an; ensur:ng t6at 9t6e 7ene<:t o< t6e (8t9 s6all 7e 9;epen;ent upon :ts reAu:rements 7e:ng sat:s<:e;9B w:t6 t6e result t6at a power o< sale om:tt:ng all ment:on o< not:8e an; per:o;s o< ;e<ault an; 8arr:e; out w:t6out re<eren8e to any Cu;:8:al ;:re8t:ons :s :n,al:; <or t6e purpose o< ena7l:ng t6e pur86aser <rom t6e mortgagee to 7e reg:stere; as owner= 199. % /L0 05 at %' In our ,:ewB t6ere<oreB t6e pro,:s:ons o< t6e )o;e as to t6e r:g6ts o< 86argors are ;es:gne; <or t6e:r prote8t:on an; 8annot 7e wa:,e;F nor 8an t6e 86argor 8ontra8t 6:msel< out o< t6e )o;e= It <ollows t6at no power o< sale 8an 7e 8on<erre; 7y a 86argor un;er t6e )o;e on a 86argee 6:msel< 7y way o< a ;e7enture or power o<

Page 14

attorney or ot6erw:seB 7ut pro8ee;:ngs must 7e 7roug6t 7y t6e 86argee to o7ta:n a Cu;:8:al sale :n a88or;an8e w:t6 t6e r:g:; pro8e;ure la:; ;own :n t6e )o;e= In su86 8:r8umstan8esB any power o< sale w6:86 purports to 7e 8on<erre; on a 86argee 6:msel<B om:tt:ng all ment:on o< not:8e an; per:o;s o< ;e<ault 7y a ;e7enture or power o< attorney an; t6e ne8ess:ty <or o7ta:n:ng a Cu;:8:al sale woul; 7e :n,al:; an; :ne<<e8t:,e to ent:tle a pur86aser to 7e reg:stere; as owner= G:t6 respe8tB we must t6ere<ore 6ol; t6at t6e 8ase o< 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd /191?0 1 MLJ 73 . :n so <ar as :t ;e8:;es to t6e 8ontrary . was wrongly ;e8:;e;= Ge 6asten to a;; t6at we 6a,e not o,erloo@e; t6e 8ases o< /alaysia Credit ;inance 2hd - ?ap 5oc, Choon ) !nor /19190 1 MLJ 252 'H:g6 )ourtB Kuala Lumpur* an; Chung >hia" 2an, Ltd - Lau !h ?en ) !nor /19190 2 MLJ 247 'H:g6 )ourtB Penang* w6:86B a88or;:ng to )ounsel <or t6e &an@ were aut6or:t:es <or t6e propos:t:on t6at a 86argor an; 86argee 8oul; 7y agreement enlarge t6e powers o< a 86argee un;er t6e )o;e an; t6us ena7le a 86argee to sell t6e 86arge; lan; w:t6out ta@:ng pro8ee;:ngs un;er t6e )o;e to o7ta:n a Cu;:8:al sale= In our ,:ewB ne:t6er /alaysia Credit ;inance9s 8ase nor Chung >hia" 2an,9s 8ase :s aut6or:ty <or t6e propos:t:on <or w6:86 t6ey were 8:te;= Moreo,erB w:t6 pro<oun; respe8tB 7ot6 t6ese 8ases 6a,e 7een su7Ce8te; to some Cust:<:a7le 8r:t:8:sm 'see Lo6 !:ew )6eang an; (gg:e PL )6ewB 9( legal :mposs:7:l:tyE (rm:ng 86argees w:t6 pr:,ate power o< sale o< 86arge; lan; outs:;e t6e pro,:s:ons o< t6e Nat:onal Lan; )o;e 19?39 /19920 1 MLJ >>>,:*= )ounsel <or t6e &an@ also rel:e; on s 22?'5* o< t6e )o;eB w6:86 pro,:;esE
22?'5* Not6:ng :n su7.s '1* s6all a<<e8t t6e 8ontra8tual operat:on o< any transa8t:on relat:ng to al:enate; lan; or any :nterest t6ere:n=

!u7se8t:on '1* pro,:;esE

'1* !u7Ce8t to t6e <ollow:ng pro,:s:ons o< t6:s se8t:on . 'a* e,ery ;eal:ng un;er t6:s (8t s6all 7e e<<e8te; 7y an :nstrument 8omply:ng w:t6 t6e reAu:rements o< ss 227 to 212F an; '7* no :nstrument e<<e8t:ng any su86 ;eal:ng s6all operate to trans<er t6e t:tle to any al:enate; lan; orB as t6e 8ase may 7eB to 8reateB trans<er or ot6erw:se a<<e8t any :nterest t6ere:nB unt:l :t 6as 7een reg:stere; un;er Pt $:g6teen=

In our ,:ewB s 22?'5* o< t6e )o;e 8onta:ns an e>press pro,:s:on w6:86 states t6at t6e pro,:s:ons o< t6e )o;e reAu:r:ng a ;eal:ng to 7e e<<e8te; :n t6e statutor:ly pres8r:7e; manner s6all not 9=== a<<e8t t6e 8ontra8tual operat:on o< any transa8t:on relat:ng to al:enate; lan; or any :nterest t6ere:n9= %6:s pro,:;es statutory aut6or:ty <or t6e l:7eral appl:8at:on o< 199. % /L0 05 at %* eAu:ty w6ene,er t6ere :s a 7as:s <or t6at 'seeB eg ?ong 8ong 5ong - Sie" Soon $ah ) 3rs /19710 2 MLJ 123F /ercantile 2an, Ltd - 3fficial !ssignee of the <roperty of 5o" 5an 8eh /19?90 2 MLJ 19?F 6nterContinental /ining Co Sdn 2hd - Societe Des :tains De 2ayas 8ud#uh /19740 1 MLJ 143F 8empleton ) 3rs - Lo" ?at 5oldings Sdn 2hd ) !nor /19950 1 MLJ 445 at p 439 an; Cheng 5ang =uan ) 3rs - <erumahan ;arlim &<enang( Sdn 2hd ) 3rs /19950 5 MLJ 532 at p 423*= Howe,erB :t :s a 8on;:t:on pre8e;ent <or t6e appl:8at:on o< s 22?'5* t6at t6ere :s :n e>:sten8e a transa8t:on relat:ng to al:enate; lan; or an :nterest t6ere:n w6:86 :s ,al:; an; en<or8ea7le as a 8ontra8t= G6enB t6ere<oreB as 6ereB t6e rele,ant pro,:s:ons o< t6e #e7enture rel:e; upon 7y t6e &an@ as 8on<err:ng upon :t a power to sell t6e lan;s are ,o:; <or t6e reasons state;B t6e 8on;:t:on pre8e;ent <or t6e appl:8at:on o< s 22?'5* :s a7sent= In our ,:ewB t6e pro,:s:ons o< t6e )o;e sett:ng out t6e r:g6ts an; reme;:es o< part:es un;er a statutory 86arge o,er lan; 8ompr:se; :n Pt HVI are e7hausti-e and e7clusi-e an; any attempt at 8ontra8t:ng out o< t6ose r:g6ts . unless e>pressly pro,:;e; <or :n t6e )o;e . woul; 7e ,o:; as 7e:ng 8ontrary to pu7l:8 pol:8y=

Page 13

Ge are supporte; :n t6:s 7y t6e <ollow:ng passages :n #ass on 8he 8orrens System in /alaya at pp 429.452E
%6e spe8:<:8 pro,:s:ons o< t6e )o;eB w6ere appl:8a7leB o,err:;e t6e 8o,enants 7etween t6e part:es= %6e met6o; pres8r:7e; <or sale :s :nten;e; to 7e e>8lus:,e= %6e <orm o< 86arge :s purely statutory= It no ;ou7t perm:ts t6e :nsert:on o< spe8:al 8o,enants an; powers l:m:t:ng or enlarg:ng t6e r:g6ts o< t6e part:es 7ut not so as to aut6or:Ie t6e 86argee to ;eal w:t6 t6e t:tle :n a manner w6:86 :s repugnant to t6e e>press pro,:s:ons o< t6e )o;e=

Ge woul;B t6ere<oreB answer t6e <:rst Auest:on o< law pose; a7o,e . :eB w6et6er t6e Re8e:,ers an; Managers were 7y ,:rtue o< t6e powers 8on<erre; upon t6em 7y t6e #e7enture ent:tle; to sell t6e 86arge; lan;s w:t6out ta@:ng pro8ee;:ngs un;er t6e )o;e to o7ta:n a Cu;:8:al sale . :n t6e negat:,eF t6at :s to sayB :n <a,our o< t6e &orrower )ompany= On a <urt6er groun; alsoB t6e &orrower )ompany :s ent:tle; to su88ee;= %6e se8on; Auest:on o< lawE G6at :s t6e :mpa8t o< t6e w:n;:ng up o< t6e &orrower )ompany on t6e re8e:,ers6:pB :n part:8ularB on t6e powers o< sale o< t6e Re8e:,ers an; ManagersKB 6a; 7een argue; 7e<ore t6e learne; Cu;ge an; ;eterm:ne; 7y 6:mF an; s:n8e :t 6a; also 7een ra:se; 7e<ore usB an; :n;ee;B <ully argue;B we t6:n@ :t woul; 7e ;es:ra7le :< we sa:; somet6:ng a7out :t as well= It was 8onten;e; 7y )ounsel <or t6e &orrower )ompany 7y way o< alternat:,e t6at alt6oug6 t6e Re8e:,ers an; Managers were agents o< t6e &orrower )ompany at t6e t:me o< t6e:r appo:ntmentB upon t6e &orrower )ompany 7e:ng pla8e; :n l:Au:;at:on on 27 De7ruary 1919B t6e:r agen8y an; powers to 8arry on t6e &orrower )ompany9s 7us:ness 8ease; '=osling - =as,ell /11970 () 373 'HL** an; t6at 8onseAuently t6ey 6a; no aut6or:ty to sell t6e 86arge; lan;s= It :s un;ou7te;ly t6e law :n t6e status as agent o< t6e n:te; K:ng;om t6at w:t6 t6e a;,ent o< l:Au:;at:onB a re8e:,er an; manager9s

199. % /L0 05 at %5 8ompany 8omes to an en; an; 6e t6en 7e8omes a pr:n8:pal :n 6:s own r:g6t unless 6e loo@s to an; re8e:,es :nstru8t:ons <rom t6e ;e7enture 6ol;er regar;:ng t6e 8on;u8t o< t6e re8e:,ers6:p 'see !merican :7press 6nternational 2an,ing Corp - 5urley /19130 5 (ll $R 3?4*= %o put :t anot6er wayB w:n;:ng up a<ter a re8e:,er an; manager :s appo:nte; term:nates 6:s purely personal powers 7ut not 6:s :n rem powers= %6e ;:st:n8t:on 7etween a re8e:,er9s an; manager9s :n rem powers an; 6:s personal powers :s t6:sE t6e <ormer <low <rom t6e se8ur:ty 8reate; 7y t6e ;e7enture an; relate to t6e assets o< t6e 8ompany w6ereas t6e latter relate to e,eryt6:ng else= !oB <or e>ampleB :n So"man - Da-id Samuel 8rusts Ltd /19710 1 (ll $R ?1?B a re8e:,er appo:nte; o,er assets w6:86 :n8lu;e; a mortgage ;e7t 8oul; ,al:;ly e>er8:se t6e power o< sale :n t6e name o< t6e 8ompany ;esp:te :ts l:Au:;at:on= %6:s powerB 7e:ng 8ouple; w:t6 an :nterestB was :rre,o8a7le 7ot6 at 8ommon law an; 7y statute an; a88or;:nglyB a power g:,en to t6e re8e:,er <or t6e purpose o< se8ur:ng a 7ene<:t to t6e ;e7enture 6ol;ers was :rre,o8a7le as a power g:,en to t6e ;e7enture 6ol;ers t6emsel,es= It was <urt6er 6el; t6at t6e sale ;:; not 8ontra,ene s 227 o< t6e )ompan:es (8t 1941 'eAu:,alent to t6e Malays:an s 225* s:n8e alt6oug6 ma;e :n t6e name o< t6e 8ompanyB :t was a sale o< property w6:86 ;:; not 7elong to t6e 8ompany 7ut <orme; part o< t6e ;e7enture 6ol;er9s se8ur:ty= I note t6at t6e H:g6 )ourt at Jo6or &a6ru :n 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er <ollowe; So"man w6en :t 6el; t6at l:Au:;at:on o< t6e 8ompany 6a; no 8onseAuen8e to t6e ,al:;:ty o< t6e power o< t6e re8e:,er to sell t6e 86arge; lan; an; e>e8ute t6e trans<er w:t6out t6e :nter,ent:on o< t6e 8ourt= In so 6ol;:ngB t6e 8ourt ;rew a s6arp ;:st:n8t:on 7etween t6e term:nat:on o< t6e re8e:,er9s agen8y o< t6e 8ompany an; t6e sur,:,al o< t6e re8e:,er9s powers un;er t6e ;e7enture w6:86 :n :ts ,:ew trans8en;e; an; e>:ste; :n;epen;ently o< t6e l:Au:;at:on 'at p 11*= %6e 8ourt also la:; stress on t6e po:nt t6at t6e power to sell un;er t6e ;e7enture arose 7y ,:rtue o< t6e 8ontra8tual pro,:s:ons o< t6e ;e7enture :tsel< an; so :t was ne8essary to ;:st:ngu:s6 7etween t6e power to sell an; t6e me86an:8s o< g:,:ng goo; t:tle= %6e 8ourt also po:nte; out t6at 6a; t6e ;e7enture 7een ;epos:te; un;er s 4 o< t6e Powers o< (ttorney Or;:nan8e 1949B t6en s ?'1*'a* o< t6e Or;:nan8e woul; 6a,e ren;ere; t6e l:Au:;at:on o< no 8onseAuen8e to t6e ,al:;:ty o< t6e power o< t6e re8e:,er to ma@e goo; t:tle to t6e 8ompany9s property :n t6e 8ompany9s name an; t6us t6e re8e:,er 8oul; sell t6e lan;=

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%6e Auest:on <or ;e8:s:on regar;:ng t6:s part o< t6e 8ase :s w6et6er :n Malays:aB s 225 o< t6e (8t pro6:7:ts t6e Re8e:,ers an; Managers <rom ma@:ng a ,al:; ;:spos:t:on o< t6e lan;s a<ter t6e 8ommen8ement o< t6e w:n;:ng up= In t6e present appealB t6e Cu;ge :n t6e 8ourt 7elow answere; t6:s Auest:on :n <a,our o< t6e Re8e:,ers an; ManagersB 7e:ng o< t6e ,:ew t6at t6e <a8t t6at a 8ompany 6as gone :nto l:Au:;at:on ne:t6er a<<e8ts a se8ure; 8re;:tor nor t6e se8ur:t:es 6el; 7y t6emF at leastB not unt:l t6e se8ure; 8re;:tor 6as 7een <ully pa:; o<<= %6e Re8e:,ers an; ManagersB t6e Cu;ge sa:;B were ent:tle; to ;o w6at t6e #e7enture ent:tle; t6em to ;o= %6e 199. % /L0 05 at %6 pr:n8:ple un;erly:ng t6:s 8on8lus:on was t6at notw:t6stan;:ng t6e l:Au:;at:on w6:86 term:nates t6e re8e:,er9s agen8y <or t6e 8ompanyB t6e re8e:,er 8ont:nue; :n o<<:8eB 6a; 8ontrol o< all or su7stant:ally all o< t6e assets o< t6e 8ompany an; may e>er8:se se8ur:ty r:g6ts <or t6e 7ene<:t o< 6:s ;e7enture 6ol;er 7yB <or e>ampleB sell:ng an; 8on,ey:ng t6e 8ompany9s property 'see So"man - Da-id Samuel 8rust Ltd*= %6:s . so t6e argument ran . was merely 8arry:ng :nto e<<e8t a ;:spos:t:on ma;e 7y t6e 8ompany w6en :t 8reate; t6e 86arge 7e<ore :t went :nto l:Au:;at:onF :t was a sale o< property w6:86 ;:; not 7elong to t6e 8ompany 7ut <orme; part o< t6e ;e7enture 6ol;er9s se8ur:ty an; t6ere<ore ;:; not reAu:re appro,al o< t6e )ourt un;er s 225 o< t6e (8t 'see 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng apply:ng So"man Da-id Samuel 8rust Ltd*= Howe,erB as we 6a,e sa:;B t6ere :s an essent:al ;:<<eren8e 7etween a )ommon Law mortgage an; a statutory 86arge un;er t6e )o;eF an; t6e po:nt we s6oul; l:@e to emp6as:Ie regar;:ng t6:s part o< t6e 8ase :s t6at un;er t6e <ormerB t6ere :s a trans<er o< owners6:p o< t6e mortgage; lan; to t6e mortgagee "hereas un;er t6e latter t6ere :s noneB w:t6 t6e 86arge ta@:ng e<<e8t as a se8ur:ty onlyB en<or8ea7le 7y pro8ee;:ngs :n 8ourt to o7ta:n a Cu;:8:al sale= It <ollows t6at :n t6e present 8aseB w:t6 t6e a;,ent o< l:Au:;at:onB any sale 7y t6e Re8e:,ers an; Managers o< t6e lan;s pursuant to t6e #e7enture woul; 7e a purporte; sale of property "hich belonged to the borro"er companyB an; so "ould reAu:re t6e appro,al o< t6e 8ourt un;er s 225 o< t6e (8t= So"man9s 8ase :s t6ere<ore ;:st:ngu:s6a7le 7e8ause t6ere :t was a sale o< property w6:86 ;:; not 7elong to t6e 8ompany 7ut <orme; part o< t6e ;e7enture 6ol;er9s se8ur:ty= %6:s :s a po:nt w6:86 was o,erloo@e; 7ot6 7y t6e Ju;ge :n t6e 8ourt 7elow an; also 7y t6e 8ourt w6:86 ;e8:;e; 1nited /alayan 2an,ing Corp 2hd 3fficial +ecei-er= %6atB 6owe,erB ;oes not 8on8lu;e t6e matter= In t6e n:te; K:ng;omB 7e8ause a re8e:,er 6as all or su7stant:ally all t6e assets o< t6e 8ompany un;er 6:s 8ontrol 7y reason o< t6e se8ur:ty 8reate; 7y t6e ;e7enture an; reta:ns t6e power to manage an; to real:Ie t6ose assetsB a l:Au:;ator :s o7l:ge; to stan; on t6e s:;el:nes :n t6e 8ourse o< t6e re8e:,ers6:p= In So"man - Da-id Samuel 8rust LtdB t6e Lan; O<<:8e 6a; re<use; to reg:ster 8on,eyan8es o< property e>e8ute; 7y t6e re8e:,er alone a<ter t6e 8ompany 6a; gone :nto l:Au:;at:on= "oul;r:ng J 6el; t6at a power o< attorney 8on<err:ng upon re8e:,ers power to ;o ,ar:ous a8ts an; :n part:8ularB to e>e8ute 8on,eyan8es :n t6e name o< t6e 8ompany sur,:,e; t6e w:n;:ng up= H:s Lor;s6:p went <urt6er an; :n;:8ate; 'at p 51* t6at t6e power o< attorney ploy may 7e ot:ose 7e8ause t6e re8e:,er9s general powers o< real:Iat:on also sur,:,e t6e w:n;:ng up e,en t6oug6 6e loses 6:s r:g6t to a8t as t6e 8ompany9s agent :n su86 a s:tuat:on= In ot6er wor;sB 6:s powers o< real:Iat:on e>:st :n;epen;ently o< 6:s aut6or:ty to 7:n; t6e 8ompany as :ts agent= %6e pos:t:on :n t6:s 8ountry :s ;:<<erent= &e8ause a re8e:,er an; manager o< any part o< t6e un;erta@:ng o< t6e 8orporat:on appo:nte; un;er a power 8onta:ne; :n any :nstrument :s 7y ;e<:n:t:on 'see s 4'1*'7* o< t6e (8t* an o<<:8er o< t6e 8orporat:on . an; all o<<:8ers o< a 8orporat:onB 199. % /L0 05 at %. w6et6er past or presentB are o7l:ge; un;er pa:n o< prose8ut:on un;er s 522'1* o< t6e (8tB to ;el:,er up to t6e l:Au:;ator appo:nte; 7y t6e )ourt or as 6e ;:re8tsE ':* all t6e mo,ea7le an; :mmo,a7le property o< t6e 8orporat:on :n 6:s 8usto;y or un;er 6:s 8ontrolF or '::* all 7oo@s an; papers :n 6:s 8usto;y or 8ontrol 7elong:ng to t6e 8orporat:onB 7e:ng 7y law reAu:re; to ;el:,er up t6e same 'see s 522'1*'7*':* an; '::** . t6e 8lear :mpl:8at:on :s t6at l:Au:;at:on ;oes not merely term:nate t6e agen8y o< a re8e:,er an; manager 7ut also 6:s powers on w:n;:ng upB since there is no estate for the recei-er and manager to administer = G:t6 respe8tB t6ere<oreB 1nited /alayan 2an,ing Corp 2hd - 3fficial +ecei-er and Li4uidator of Soon 5up Seng Sdn 2hd w6:86 rel:e; on So"man must 7e ta@en to 6a,e 7een wrongly ;e8:;e; on t6:s po:nt as well= %6ere :s anot6er matter regar;:ng t6:s part o< t6e 8ase to w6:86 we s6oul; l:@e to ;:re8t attent:on=

Page 17

%6e only persons w6o may 7e ma;e respon;ents :n m:s<easan8e pro8ee;:ngs un;er s 523 o< t6e (8t are promotersB l:Au:;ators an; o<<:8ers= &y s 4'1*'7*B 9o<<:8er9 :s ;e<:ne; to :n8lu;e 9a re8e:,er an; manager o< any part o< t6e un;erta@:ng o< t6e 8orporat:on appo:nte; un;er a power 8onta:ne; :n any :nstrument9 . t6at :s to sayB a pr:,ately.appo:nte; re8e:,er an; managerF 7ut ;oes not :n8lu;eB :nter al:aE ':* any re8e:,er w6o :s not also a managerF an; '::* any re8e:,er or manager appo:nte; 7y t6e 8ourt or 8re;:tors= Or;ers may t6us 7e ma;e un;er s 523 aga:nst a pr:,ately.appo:nte; re8e:,er an; manager= %6:s 7r:ngs us to t6e 8ase o< +e 2 0ohnson ) Co &2uilders( Ltd /19330 1 )6 ?54B w6ere:n :t was ;e8:;e; t6at re8e:,ers an; managers appo:nte; 7y ;e7enture or loan se8ur:ty 6ol;ers were not w:t6:n t6e 8ategor:es o< persons w6o 8oul; 7e ma;e respon;ents :n m:s<easan8e pro8ee;:ngs un;er s 555 o< t6e K )ompan:es (8t 1941= %6e reason:ng o< t6e )ourt o< (ppeal <or t6:s 8on8lus:on may 7e 8on,en:ently ta@en <rom t6e Cu;gment o< Par@er LJ 'at pp ??5 an; ??4* w6ere 6:s Lor;s6:p sa:; t6:sE
%urn:ng to t6e wor;:ng o< t6e se8t:on :tsel<B :< a re8e:,er an; manager :s :n8lu;e;B :t 8an only 7e 7e8ause 6e 8omes w:t6:n t6e wor;s 9any o<<:8er o< t6e 8ompany9 or t6e wor; 9manager9= !o <ar as t6e e>press:on 9o<<:8er9 :s 8on8erne;B t6:s :s ;e<:ne; 7y s 433 o< t6e (8t as :n8lu;:ng 9a ;:re8torB manager or se8retary9= No ;ou7t a person w6oB :n <a8tB manages :s a 9manager9 w:t6:n t6at ;e<:n:t:onB pro,:;e;B an; pro,:;e; alwaysB t6at 6e ;oes so 7y ,:rtue o< some o<<:8e w6:86 6e 6ol;s :n t6e 8ompany= &ut any wor@ o< management ;one 7y a re8e:,erB t6oug6 ;one as agentB :s not ;one 7y ,:rtue o< any o<<:8e t6at 6e 6ol;s :n t6e 8ompanyF an; t6:s :s so w6et6er 6e :s appo:nte; 7y t6e 8ourt or out o< 8ourt= Moreo,erB t6e 8ontrary was 7ut <a:ntly argue;= In;ee;B t6e ma:n argument ra:se; 7y Mr &la8@le;ge was 7ase; on an a88eptan8e o< t6e ,:ew t6at a re8e:,er an; manager :s not w:t6:n t6e ;e<:n:t:on o< 9o<<:8er9= "rante; t6at 6e :s not 'so runs t6e argument*B yet 9manager9 :n s 555 :tsel< must 7e use; :n a ;:<<erent an; w:;er sense t6an w6ere :t appears :n t6e ;e<:n:t:onB namely as mean:ng someone w6o manages :n t6e w:;est senseB e,en t6oug6 not an o<<:8er= Loo@e; at :n t6:s wayB t6e wor; :s w:;e enoug6B so :t :s sa:;B to em7ra8e a re8e:,er an; manager= Howe,er plaus:7le t6:s argument may 7e at <:rst s:g6tB :t mustB I t6:n@B <a:l w6en t6e 6:story o< t6e se8t:on :s 8ons:;ere;= %6usB t6e wor;:ng o< s 555 199. % /L0 05 at % :s to 7e <oun; :n ,ery s:m:lar <orm pers:st:ng :n su88ess:,e (8ts s:n8e 11?2F w6ereas t6e ;e<:n:t:on o< 9o<<:8er9 appears <or t6e <:rst t:me :n t6e (8t o< 1941= Durt6erB t6e argument <or a ;:st:n8t:on 7etween t6e mean:ng o< 9manager9 :n t6e se8t:on an; :n t6e ;e<:n:t:on goes w6en :t :s real:Ie; t6at 9;:re8tor9 also appears :n 7ot6 pla8es= G6atB 6owe,erB :n my Cu;gmentB :s ;e8:s:,e o< t6e 8ase :s t6at any wor@ o< management ;one 7y a re8e:,er :s not ;one as manager o< t6e 8ompany= %6e powers o< management are an8:llary to 6:s pos:t:on as re8e:,erB an;B :n e>er8:s:ng t6ose powersB 6e :s not a8t:ng as manager o< t6e 8ompany 7ut as manager o< t6e w6ole or part o< t6e property o< t6e 8ompany= %6:s ;:st:n8t:on :sB as :t wereB un;erl:ne; 7y t6e (8t :tsel< 'see t6e group o< se8t:ons :n Pt VI o< t6e (8tB w6ere t6e e>press:on 9re8e:,er or manager o< t6e property o< t6e 8ompany9 :s use; t6roug6out*= In my Cu;gmentB :t :s 8lear t6at a person o88upy:ng t6e pos:t:on o< Mr (:Ilewoo; :n t6e present 8ase :s not a 9manager9 or 9o<<:8er9 w:t6:n t6e se8t:on=

It :s 8lear t6at t6e 7as:s o< t6e po:nt ;e8:;e; :n +e 2 0ohnson ) Co . namelyB t6at pr:,ately.appo:nte; re8e:,ers an; managers are not w:t6:n t6e rea86 o< m:s<easan8e pro8ee;:ngs . was 7e8ause t6ey were not w:t6:n t6e 8ategor:es o< persons name; :n t6e rele,ant statutory pro,:s:onB t6e mater:al part o< w6:86 :s ;:<<erent <rom t6e 8orrespon;:ng pro,:s:on :n our (8t= In t6e resultB we woul; allow t6e appeal w:t6 8osts 7ot6 6ere an; :n t6e 8ourt 7elowB set as:;e t6e Cu;gment o< t6e 8ourt 7elow an; su7st:tuteB :n l:eu t6ereo<B ;e8laratory or;ers answer:ng 7ot6 t6e Auest:ons o< law a<oresa:; :n <a,our o< t6e 7orrower 8ompany= %6e ;epos:t pa:; :nto 8ourt must 7e re<un;e; to t6e 7orrower 8ompany= !ppeal allo"ed

Reported by Kenneth Goh