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AppellantMalayan United

Finance Bhd

Registeredproprietor

Kam Mah TheatreSdn Bhd

RespondentTay Lay Soon

Land

Charged to securerepayment of loanof $!" million

Too# preliminary steps to commence foreclosureproceedings to enforce the charge

t %as found that t%o prilodged against the land

'efaulted

Ca&eatpurporsell the

Case: Malayan unitedfinance bhd v tay lay soon

[1991] 1 mlj 504

)*uity ofRedemption

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FactsThere %as a dispute (et%een the appellant and the respondent! The respondent ha(rought an action for specific performance of the agreement!

The appellants applied to ha&e the ca&eats remo&ed under s +,- of the .ational LaCode /0"1 and argued that it %as the registered chargee1 presently e2ercising iright of sale of the charged property under s ,"0! t also argued that the charge oregistration %as indefeasi(le and ran#ed in priority o&er the ca&eats!

The learned trial 3udge (asing himself on the principles enunciated in Eng Ah MooiOrs v Oversea Chinese Banking Corp Ltdheld that the ca&eator had succeeded sho%ing a tria(le issue as (et%een himself and the chargee and he dismissed thapplication! The appellants appealed!

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ssue5

6hether the e*uity of redemption under the )nglish la% is applica(le in landMalaysia!

7eld5 The appeal %as allo%ed5

n this case the chargee 8the appellant9 had an indefeasi(le right(y &irtue of the registratiof the charge and this right had priority o&er the ca&eats %hich %ere lodged fi&e years aftthe registration of the charge!

The respondent:s proposition that he has a statutory or e*uita(le right of discharge redemption of a chargeunder the pro&isions of the .ational Land Code must (e re3ected! tthe chargor or the (orro%er 8the registered proprietor9 %ho has the right to discharge thcharge and the right to tender payment (efore the 3udicial sale is specifically and e2clusi&egranted to the chargor! Since the right or interests in the charged land remains %ith tregistered o%nerhe has nothing to redeem!

The e*uity of redemption or the li#e of it in the situation under the .ational Land Code clearly technically and legally incorrect! The system of registration does not permit thapplication of the doctrines of e*uity relating to )nglish tenure to land matters in Malaysia!

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;rinciples

The e*uity of redemptionrefers to the right of a mortgagor in la% toor her property once the lia(ility secured (y the mortgage has (een d

The distinction (et%een a mortgage and a charge is that in a moo%nership of the land is transferred to the mortgagee %hile %hat is mortgagor is an e*uita(le right to redeem< in a charge1 the chargero%nership %hile the chargee ac*uires a statutory right to enforce his

Since the right or interests in the charged land remains %ith the

o%ner1 the respondent has nothing to redeem!

=)*uity of redemption> is a misnomer (ut persistence in its use is notla% (ut of ha(it of Australia and in Malaysia it does not e2ist at all!

Therefore1 the doctrine of e*uity of redemption is inapplica(lein Mala