Lim Cheng Im
Lim Cheng Im
Malayan Law Journal Unreported/2016/Volume/Lim Cheng Im v Jagdish Kaur a/p Gurdial Singh - [2016]
MLJU 1204 - 23 May 2016
Selvarajah (Nagaletchimy with him) (Fernandez & Selvarajah) for the plaintiff.
Daljeet Sachdev (Siti Nurulhidayati bt Zulkarnain with him) (Daljeet Sachdev & Co) for the defendant.
GROUND OF JUDGMENT
A. BACKGROUND FACTS
[1] The present case is simply a case of a breach of contract for the sale of an immovable property. The
Plaintiff claims for Specific Performance of the contract while the Defendant claims for breach and
termination of the contract.
[2] Lim Cheng Im ("Plaintiff") is the purchaser who has entered into a sale and purchase agreement on
16.7.2004 ("SPA 2004") with Jagdish Kaur A/P Gurdial Singh ("Defendant") in which the Plaintiff agrees to
purchase the Defendant's piece of land and the Defendant agrees to sell the piece of land to the Plaintiff for
the consideration of RM107,000.00. The Defendant has entered into SPA 2004 on behalf of the registered
proprietor utilising an undisputed Power of Attorney No. 23608/2001dated 5.7.2001.
[3] Around 2013, the Defendant has entered into another sale and purchase agreement purporting to sell the
same piece of land to a third party ("2nd SPA"). The Defendant asserts that the earlier SPA 2004 has
lapsed and it is within her rights to sell the land to the third party. The Plaintiff on the other hand, upon
overwhelming evidences in contrary of the Defendant's ultimately bare assertions, contends that at all
material times, SPA 2004 remains valid, enforceable, and subsisting. Thus, the Defendant has allegedly
breached SPA 2004, giving rise to the Plaintiff's present case, claiming against the Defendant, inter alia for
Specific Performance of the Contract under Sections 21 (3) and 11(2) of the Specific Relief Act as well as
clauses 7 and 11 of SPA 2004, and numerous consequential orders from this Court.
[4] Before this Court embarks to determine the parties' respective claims, it is pertinent that this Court
highlights the core terms of SPA 2004
a. The Defendant shall ensure that the land is free from any encumbrances;
b. It is solely the Defendant's obligation to ensure that all the proper consent and permission from
the authorities are obtained at her own expense;
c. Besides the 90 days completion period for the payment of the balance purchase price from the
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date of the consent of authority, the completion period is also dependent on other terms of the
contract;
d. The contract may be terminated and can be considered to be terminated by the Defendant only
if there was breach on the Plaintiff's part and the Defendant forfeits the Deposit paid by the
Plaintiff; and
e. The Plaintiff may claim for Specific Performance against the Defendant in case the Defendant
breaches SPA 2004.
[5] It was admitted and undisputed that the Plaintiff has already paid the deposit of RM10,700.00 on
16.7.2004.
[6] It was admitted and undisputed that, at all material times the Defendant had never evinced any intention
to forfeit this deposit, even after the lapsing of 90 days after the date of the authority's consent.
[7] It was admitted and undisputed that the Defendant was only able to obtain the initial consent from the
authorities through the Plaintiff's solicitor's assistance.
[8] It remains undisputed that the Defendant has failed to ensure the land to be free from encumbrances
during the one (1 ) year validity period of the initial consent.
[9] It remains undisputed that at certain points of time that the land was free from encumbrances, the
Defendant has failed to obtain fresh consent from the authorities during this time.
[10] It remains undisputed that the Plaintiff has at all material times acted on her rights in lodging two
caveats onto the land on 9.8.2004 as well as 16.8.2010.
[11] It remains undisputed that the Plaintiff had only discovered of the Defendant's 2nd SPA with the third
party in the year 2014 when the Plaintiff managed to extract the cause papers of the Defendant's Originating
Summons to remove the Plaintiff's 2nd caveat which was dismissed by the High Court.
[12] It remains undisputed that the land was encumbered with two caveats lodged by the Defendant's sister
registered on 19.10.2004 ("1stencumbrance") and 9.1.2012 ("2nd encumbrance") (collectively referred to
as "encumbrances").
[13] It remains undisputed that the Defendant has never done anything in ensuring that the encumbrances
lodged by the Defendant's sister were removed from the land.
[14] It remains undisputed that the Plaintiff's rights have twice been upheld by the High Court. First, when the
High Court on 26.5.2015 had set aside an ex-parte order dated 15.8.2014 (order to remove Plaintiff's 2nd
caveat) and re-instated the Plaintiff's 2nd caveat. Secondly, when the High Court dismissed the Defendant's
originating summons to remove the Plaintiff's 2nd caveat and maintained the Plaintiff's 2nd caveat on
19.11.2015.
B. SPA 2004 HAS NEVER LAPSED AND REMAINS TO BE VALID, ENFORCEABLE AND SUBSISTING
[15] For numerous grounds which are astoundingly bare, the Defendant contends that SPA 2004 has come
to its end and it was within the Defendant's rights to resell the land to the third party vide the 2nd SPA. The
main crux of the Defendant's contention is that the Plaintiff has ultimately failed to furnish the balance
purchase price within the 90 days completion period as provided for by SPA 2004. However, documentary
evidences have proven otherwise. There are overwhelming reasons that this Court cannot agree with the
Defendant's assertion of SPA 2004's termination. The reasons shall be addressed categorically below:
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[16] The Defendant heavily relies on the term that the balance purchase price must be paid within 90 days
from the date of consent to transfer by the authority. Indeed the balance purchase price was never paid by
the Plaintiff. But this non-payment does not necessarily entail a breach by the Plaintiff. Apart from the 90
days completion period as well as the 60 days grace period, Preamble 3 of SPA 2004 also stipulates that
"... Completion Date subject always to the terms and conditions hereinafter appearing."
[17] Thus, a plain reading of Preamble 3 would easily reveal that the completion period and grace period
stipulated is not the 'be all and end all' provision as to the Plaintiff's obligation to furnish the balance
purchase price. It is very important to note that the completion period itself is subject to other terms which
should be read holistically rather than an isolated reading as purported by the Defendant.
[18] Therefore, it is pertinent to appreciate that the completion and grace periods are also subject to the
Defendant's contractual obligations to obtain the authority's consent as well as ensuring that the land is free
from any encumbrances. Until and unless these conditions are met, then it is vividly clear that the Plaintiff's
obligation to furnish the rest of the purchase price never accrued.
[19] Having the above terms in mind, it is incumbent for the Defendant to ensure that these conditions are
met and coincide with each other at the same time. Reiterating the undisputed facts above, there was one
period of time when the Defendant, with the assistance of the Plaintiff's solicitors, has successfully obtained
the authority's consent on 3.4.2006. However, during the one year validity period of this consent, the land
was never free from encumbrances considering the fact that the Defendant's sister's 1st encumbrance was
still in full force. Thus, at all material times of the consent's validity, the Defendant remains to have failed to
fulfil her obligation and it naturally entails that the Plaintiff's obligation to furnish the balance purchase price
has never accrued. Thereto, the Plaintiff has not committed any breaches here, and the contract has never
lapsed considering the Defendant's continuing failure to ensure that the land is free from encumbrances.
[20] From another tangent, the Defendant sought to prove the Plaintiff's alleged failure to furnish balance
purchase price during the period between the lapsing of the 1st encumbrance and the lodgement of the 2nd
encumbrance.
[21] It is indeed true there was this period before the Defendant's sister's lodgement of the 2nd encumbrance
that the land was free from encumbrances. However, while the land was free from encumbrances during this
period, the Defendant still has not performed her part of the contract for the simple reason that during this
time, the consent from the authority has already lapsed and it is incumbent for the Defendant to apply and
obtain a fresh consent. This is exactly what the Defendant has failed to do, although the land was free of
encumbrances. Thus, again, the Plaintiff's obligation to furnish the balance purchase price never accrued
and the contract has never lapsed.
[22] Considering the above findings, it is opportune for this Court to look into SPA 2004's terms on
termination of the contract. Clause 7 of SPA 2004 simply stipulates that in case of the Plaintiff's breach, the
Defendant has an option to terminate the contract and forfeit the deposit paid by the Plaintiff. However, the
facts and evidence of the present case do not support that there was any breach by the Plaintiff and do not
show that the Defendant has ever communicated to the Plaintiff that she intends to forfeit the deposit paid. It
is infinitely telling and more probable than not that the Plaintiff has never breached the contract, considering
the fact that the Defendant has never evinced any intent to terminate the contract and forfeit the deposit paid.
[23] In light of the foregoing findings, it is this Court's decision that SPA 2004 at all material times remain to
be valid, enforceable and subsisting. SPA 2004 has never lapsed and the Defendant has no rights to
exercise the option under clause 7 to terminate the contract considering the fact that the Plaintiff has never
committed any breach.
[24] This Court is further guided by the time-hallowed principle that no person can make a case out of his
own fault. Especially in the present case, if there is any breach to the contract, it was the Defendant who has
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time and time again failed to fulfil her end of the bargain. This Court finds guidance in the Court of Appeal's
decision in the case of Pentadbir Tanah Daerah Petaling Jaya v Swee Lin Sdn Bhd [1999] 3 MLJ 489 which
has held that:
"...there is a principle of great antiquity that a litigant ought not to benefit from its own wrong. Although of universal
application, it has been restated when applied to a particular context. For example, the principle when applied in the
context of the law of contract may be formulated as follows: a party ought not to be permitted to take advantage of
his own breach...".
[25] It was similarly held by the High Court in the case of Timur Permai Holdings Sdn Bhd v Soon Seng
Plywood & Timber Sdn Bhd (No 2) [1998] 3 CLJ 408 that:
"In my view, it would be unjust and unconscionable for the defendant to profit from its own breach."
[26] Thus, it would be similarly unconscionable for this Court to allow the Defendant to contend on the
lapsing and termination of SPA 2004 when it was the Defendant's own delinquent breaches which have led
to the extended completion period beyond the 90 days and 60 days grace period. It was the Defendant's fault
that she has done absolutely nothing to ensure that the encumbrances was lifted off from the land and it was
the Defendant's own fault that she has not obtained the proper consent from the authorities at times the land
was free from encumbrances. The Defendant cannot reap any benefits from her own breaches.
C. THE PLAINTIFF HAS ALWAYS REMAINED INTERESTED AND HAS NEVER CAUSED ANY
INORDINATE DELAYS IN THE PERFORMANCE OF SPA 2004
[27] Against the overwhelming evidence of the Plaintiff's eagerness to abide by the terms of SPA 2004, the
Defendant asserts that the Plaintiff has shown disinterest to the completion of SPA 2004 and has inordinately
delayed its claim for Specific Performance against the Defendant.
[28] This Court has no hesitation to dismiss this contention. It is utterly obvious that the Plaintiff has done all
she could within the perimeter of her obligations under the contract, to complete the performance of the
contract.
[29] It is noted that the period between date of the contract until the Defendant's 2nd SPA with the third party
spans for about 9 years. However, the 9 years are not barren without any activities by the Plaintiff. That is
not at all the case. In fact, it is verily understandable and justifiable that the Plaintiff only commenced this
action recently, simply for the reason that the Defendant's blatant breach in entering into the 2nd SPA was
kept hidden by the Defendant and was discovered only circa 2014 when the Plaintiff finally managed to
extract the cause papers of the Defendant's originating summons. There was no inordinate delay. Reiterating
the earlier finding, the ball is now on the Defendant's court to perform her end of the obligations. All these
years, the Plaintiff was waiting for the Defendant to sort out the issue with the Defendant's sister's
encumbrances and obtain the proper consent from the authorities, both obligations which the Defendant has
not fulfilled. There was nothing for the Plaintiff to do until and unless the Defendant manages to furnish the
land free from encumbrances and procured the proper consent from the authority.
[30] All the while before the discovery, the Plaintiff and in fact the Defendant has always maintained and
preserved the status quo of the enforceability, validity and subsistence of SPA 2004. Firstly, it is plain to
deem so owing to the fact that the Plaintiff has paid thousands of ringgit worth of deposit in staking her
interest on the land as per SPA 2004. For all the years, the Plaintiff has never sought any sort of refund of
the deposit, showing a continued interest to the land. And most pertinently, the Defendant has never evinced
any intention either to forfeit or refund the Deposit to the Plaintiff. This fact alone is sufficiently telling that the
Defendant understands that the Plaintiff has never committed any breach, the SPA 2004 remains valid and
that both parties have always remained interested to the continuing subsistence of SPA 2004.
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[31] Secondly, beyond the Plaintiff's own obligations under SPA 2004, the Plaintiff in furtherance of her
interest in the land and out of her own goodwill has allowed the Plaintiff's own solicitors to assist the
Defendant to obtain the initial consent by the authorities. The Plaintiff need not to do so considering the
procurement of the necessary consent and approvals is solely the obligation of the Defendant.
[32] Thirdly, it was in fact admitted by the Defendant herself during cross-examination that, albeit having full
knowledge and access to communicate with the Plaintiff or the Plaintiff's solicitors, it was the Defendant
herself who has disappeared and no longer has any interest to abide by SPA 2004. This glaring admission is
proof of the Defendant's own blatant breach, failure and refusal to perform the Defendant's obligations under
SPA 2004. The relevant portion of the cross-examination is reproduced here:
"SVJ ... You said you could not contact her. You knew the lawyer's address, the firm. You knew where the lawyers
were, agree?
SVJ Yes. So if you wanted to contact the Plaintiff, and if she had moved, you agree that you could have gone to the
lawyer's office to find out where she stayed and how to contact her? Would you agree you could have done that?
SVJ Sorry?
JK Yes
SVJ And did you make this known to the Plaintiff? 'Look, I'm not interested'. Did you make it known?
JK No"
[33] It is patently clear from the above that the Defendant has deliberately kept the Plaintiff in the dark of her
unlawful intention to renege from SPA 2004. She admits to having the means to access and communicate
with the Plaintiff or the Plaintiff's solicitors. But instead, the Defendant chose to hide within the shadows and
'wait' until SPA 2004 'lapses' although in reality, the lapsing or termination never occur.
[34] Fourth, the Plaintiff has tenuously and diligently shown great initiative in protecting her rights under SPA
2004. It is astounding that amidst all the evidence, the Defendant still contends that the Plaintiff has not
taken the appropriate initiatives to complete SPA 2004. Besides paying the deposit and assisting the
Defendant with the procurement of the initial consent, the Plaintiff has twice lodged her own caveats to
protect her interest under SPA 2004 on 9.8.2004 as well as 16.8.2010. The 2nd caveat of 16.8.2010 remains
valid even until the day of trial. Not only that, the Plaintiff has twice thwarted the Defendant's unlawful
attempts to defeat SPA 2004. First, when the Plaintiff has successfully set aside the ex parte order dated
15.8.2004 restoring the 2nd caveat in the register. Second, when the Plaintiff successfully defended against
the Defendant's originating summons to remove the 2nd caveat. Together with the present claim, all of these
aforementioned activities are the Plaintiff's gallant efforts in ensuring the operability, enforcement, and
performance of SPA 2004.
[35] In fact, it is pertinent to note that upon cross-examination, the Defendant was utterly unable to
particularise what she meant with the Plaintiff's lack of initiative and the Plaintiff's disinterest. Not only the
Defendant's contention was unsubstantiated, the Defendant herself could not explain what was the Plaintiff's
alleged disinterest and lack of initiative.
[36] It is interesting to note that the Defendant upon her admissions have contradicted her own witness
statement. The Defendant in her witness statement has stated that she has no knowledge that the initial
consent by the authority was ever issued. However, during cross-examination the Defendant has blatantly
contradicted herself:
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SVJ ... You don't know. Alright, my next question is that the application was made and a letter was received from the
Land Office and that letter in Bundle A at page 13. Please look at the page 13. Sorry, Bundle B, sorry. I am sorry, I
apologies. It is the yellow copy, yes that is right, the yellow bundle, Bahagian A, page 13 and 14. Do you see Madam?
JK Yes.
SVJ And that letter at page 14 is copied to you, to your address. Could you see that? Yes?
JK It is.
[37] It is trite law that a party cannot be allowed to approbate and reprobate as when a party wishes. In the
present case then, the Defendant cannot be allowed to admit knowledge of the consent as and also deny the
same knowledge on the same breath. Valuable guidance can be found in the Court of Appeal's decision in
the case of Cheah Theam Kheang v City Centre Sdn Bhd & Other Appeals (2012) 2 CLJ 16 regarding the
Defendant's conduct of blowing hot and cold with its stance:
"In other words of Sir Nicolas Browne-Wilkinson VC in Express Newspapers Plc v News (UK) Ltd and Others (1990) 3
All ER 376 at pp. 383 to 384: There is a principle of law of general application that it is not possible to approbate and
reprobate. That means you are not allowed to blow hot and cold in the attitude that you adopt. A man cannot adopt
two inconsistent attitude towards another : he must elect between them and, having elected to adopt one
stance, cannot thereafter be permitted to go back and adopt an inconsistent stance."
(See also Boustead Trading (1985) Sdn Bhd v Arab Malaysian Merchant Bank Bhd [1995] 3 MLJ 331)
[38] Thus, as it was admitted and more probable than not that the Defendant indeed has knowledge of the
authority's consent, it would be unjust and unconscionable for this Court to allow the Defendant to contend
otherwise.
[39] It is well within the rights of the Plaintiff to invoke the clause for the Defendant's breach, which allows a
claim for Specific Performance by the Plaintiff against the Defendant. Clearly the Defendant's act in entering
into the 2nd SPA was a blatant breach of SPA 2004.
[40] The facts of the case falls squarely in the ambit of Section 21(3) of the Specific Relief Act 1950 which
reads:
"(3) A case in which the court may properly exercise a discretion to decree specific performance is where the plaintiff
has done substantial acts or suffered losses in consequence of a contract capable of specific performance"
[41] Clearly as deliberated above, the Plaintiff has tenuously fought for the performance and subsistence of
SPA 2004. Indeed, the Plaintiff has done substantial acts in consequence of SPA 2004.
[42] It is patently clear that the Plaintiff has succeeded to "prove a continuous readiness and willingness,
from the date of the contract to the time of the hearing, to perform the contract on his part" as
required cases claiming for specific performance. (See Federal Court's decision in Ganam d/o Rajasamy v
Somoo s/o Sinnah [1984] 2 MLJ 290)
[43] SPA 2004 also falls within the category of contracts which are specifically enforceable under the ambit
of Section 11(2) of the Specific Relief Act 1950:
11. Cases in which specific performance enforceable
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...
(2) Unless and until contrary is proved, the court shall presume that the breach of a contract to transfer immovable
property cannot be adequately relieved by compensation in money, and that the breach of a contract to transfer
movable property can thus be relieved.
[44] It is trite that the burden to rebut the presumption lies on the party attempting to defeat the decree of
specific performance. The High Court in Timur Permai's case has upheld the following:
"In Loke Koon Moy & Anor v Zaibun Sa Binti Syed Ahmad [1978] 2 MLJ, Chang Min Tat FJ (delivering the judgment of
the Federal Court) referred to s. 11(2) of the Specific Relief Act 1954 and held that the burden of rebutting this
presumption lay on the respondent (vendor)."
[45] SPA 2004 is clearly a contract of transfer of immovable property. The Defendant has not even pleaded
any facts to defeat the presumption that the Plaintiff cannot be adequately compensated with monies. The
Defendant has even failed to adduce any evidence to prove that the Plaintiff could be adequately
compensated with monies.
[46] In light of all the above, it is this Court's decision that the Plaintiff has successfully fulfilled all the
requirements to prove a case for a decree of specific performance.
E. THE DEFENDANT'S DEFENCE UNDER SECTION 21(2)(b) OF THE SPECIFIC RELIEF ACT 1950 IS
ILL-CONCEIVED
[47] From the outset, it must be reiterated that if there was any delay to complete performance of SPA 2004,
it was at no fault of the Plaintiff, and totally at the fault of the Defendant who has continuously failed to
perform her end of the bargain.
[48] This Court is surprised with the Defendant's attempt to invoke a defence under Section 21(2)(b) of the
Specific Relief Act 1950 on an erroneous and utterly ridiculous contention that the Defendant would suffer
hardship from being unable to sell the land at an appreciated price to the third party if the Court were to order
Specific Performance of SPA 2004 against the Defendant. The Section reads:
(2) The following are cases in which the Court may properly exercise a discretion not to decree specific performance:
...
(b) Where the performance of a contract would involve some hardship on the defendant which he did not foresee,
where as its non-performance would involve no such hardship on the Plaintiff.
[49] It goes against the usual/common commercial or business structure and contractual fairness if the Court
would deny Specific Performance of a contract merely for the reason that a party would be denied of a more
lucrative deal than the initial contract that the party has entered into. This is exactly what the Defendant is
purporting from this Court.
[50] First of all, any appreciation of the land's price is not at all the Defendant's right to claim. The Defendant
has agreed to sell the land at an agreed price to the Plaintiff since the year 2004. The only thing that the
Defendant stands to gain from the land would only be the agreed purchase price. Whatever appreciation of
the land at any time after SPA 2004 is the Plaintiff's sole right to claim. It matters not if the completion of the
contract would take a whole century as the land shall ultimately be transferred to the Plaintiff under SPA
2004. It is never right or lawful for the Defendant to excuse herself from SPA 2004 merely because she
wants to obtain a better deal to sell the land at an appreciated price in.
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[51] There is no hardship against the Defendant here. The Defendant did not lose any appreciation of the
land price. The Defendant is not even remotely in any position to lose any appreciation of the land price.
[52] In fact, the appreciation of the land's price is obviously within the clear contemplation of both the parties
especially the Defendant. The Defendant knows that as time passes, the land shall appreciate in price.
Nevertheless, knowing this fact, the Defendant has agreed to part with the land for an agreed price in 2004
under SPA 2004. Even if there was any hardship (which this Court dismisses), the appreciation of the land is
verily foreseeable to the Defendant.
[53] Not only that, in reference to the 2nd limb of subsection (b), it is equally a requisite that the
non-performance of the contract shall not inflict the same hardship against the Plaintiff. It is patently clear
here that that the Plaintiff, having the rights on the appreciation of the land's price, shall be deprived of the
land's appreciation if SPA 2004 was not performed. Thus, the Defendant's contention here fails on both limbs
of the section. In that, firstly, there was no hardship against the Defendant if the contract is not performed or
if there was any hardship, the hardship was completely foreseeable by the Defendant. And secondly, the
Plaintiff shall also stand to suffer the same hardship of the loss of the land's price appreciation if SPA 2004 is
not performed.
[54] Furthermore, the Defendant has never pleaded any facts or the defence under Section 21(2)(b) of the
Specific Relief Act 1950 thus it is even more so appropriate for this Court to dismiss the Defendant's
contention. The Court of Appeal in the case of M Nithiyanthan v Soong Ba Cheek [1998] 2 MLJ 633 has
held that:
"Hardship is a defence to a decree of specific performance and should be pleaded. There is no such plea in his
defence and there is no evidence of hardship or to rebut the presumption in s 11(2). Thus... we hold that the agreement
is one proper to be specifically enforced and may be so enforced."
[55] At the very least, it is reiterated here that the delays are all at the fault of the Defendant, and thus, the
Defendant cannot be allowed to make a case out her own breaches against the contract.
[56] In light of all of the above findings, it is this Court's decision that the Plaintiffs on the balance of
probabilities have clearly and successfully proven their case.
[57] This Court hereby dismisses all of the Defendants' defences as well as counter-claims;
[58] This Court hereby grants a decree of Specific Performance compelling the Defendant to abide by terms
of SPA 2004 and perform all of her obligations under SPA 2004;
[59] This Court hereby finds that the Defendant has unlawfully entered into an invalid agreement with the
third party which is the 2nd SPA which is in blatant breach of SPA 2004;
[60] This Court orders that the Defendant shall within 14 days from the date of the order for specific
performance to take all appropriate measures to submit a proper and complete application, free from errors
and omissions, for consent to transfer the land by the State Authority;
[61] This Court further orders that the Defendant shall furnish to the Plaintiff copies of such application for
consent, supporting documents and correspondence submitted and duly acknowledged as received by the
relevant authorities;
[62] Alternatively considering that the consent is the land's restriction-in-interest, if the consent to transfer is
lawfully refused by the authorities or that the Defendant ultimately is unable to obtain the consent, this Court
directs that an order for damages to be paid to the Plaintiff shall be made. The damages shall be assessed
by the Deputy Registrar and shall take into account of the land's appreciation in value.
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[63] Having heard the submissions from the learned counsels for the Plaintiff and the Defendant, this Court
hereby orders the Defendant to pay the Plaintiff a global sum of RM ___________in costs.