JUDGMENT
Introduction
[1] The central issues in these two appeals relate to (i) the indefeasibility of title and interest and the question of whether a party is an immediate or subsequent purchaser under s 340 of the National Land Code (NLC), and (ii) the circumstances under which a term may be implicated to a letter of undertaking.
[2] The parties in these appeals were brought together by a series of fortuitous events. It began with the transfer of land to Heveaplast Marketing Sdn Bhd ('Heveaplast') by way of fraud and forgery, the creation of two charges ('UOB charges') over the land by Heveaplast in favour of United Overseas Bank Bhd ('UOB'), the aborted sale of the land by Heveaplast to Kum Hoi Engineering Industries Sdn Bhd ('Kum Hoi') and the giving of undertakings to refund monies by UOB and Heveaplast to Kum Hoi's financier Public Bank Bhd ('PBB').
[3] The owners of the land, See Leong Chye @ Sze Leong Chye and See Ewe Lin ('See brothers') sued Heveaplast, UOB and the solicitors involved for damages and the recovery of the land on the ground that it was fraudulently transferred; in turn, Heveaplast sued the Registrar of Lands and Mines for an indemnity and contribution. In a separate action, Kum Hoi sued Heveaplast and UOB for the refund of monies paid. The two suits were heard together in the High Court.
[4] After a full trial, the High Court held that Heveaplast obtained the land through fraud and forgery of instruments ie, the sale and purchase agreement and the memorandum of transfer. The High Court also held that the forged instruments were a nullity and incapable of conferring any right, interest or title in favour of Heveaplast. The UOB charges created thereout were also a nullity. Consequently, both Heveaplast's title and UOB's interest are defeasible under s 340 of the NLC. Heveaplast's claim against the Registrar of Lands and Mines for indemnity and contribution was dismissed. The High Court also ordered Heveaplast and UOB to refund the monies to Kum Hoi.