Bank of China v First National Bank of Boston

JudgeLai Kew Chai J
Judgment Date18 August 1988
Neutral Citation[1988] SGHC 63
Docket NumberOriginating Summons No 429 of 1986
Date18 August 1988
Published date19 September 2003
Plaintiff CounselVK Rajah (Rajah & Tann)
Citation[1988] SGHC 63
Defendant CounselKoh Kok Wah (Arthur Loke & Partners)
CourtHigh Court (Singapore)
Subject MatterCaveats,O 50 r 1 Rules of the Supreme Court 1970,Lapse of caveat lodged by plaintiff,Defendant lodges caveat prior to fresh caveat of plaintiff,Judgment for defendant against owner of property,s 18(2) Supreme Court of Judicature Act (Cap 322),ss 59(2), 104(4) & 114 Land Titles Act (Cap 157),Defendant obtains charging order against property,Priority of caveats,Land,Property mortgaged to plaintiff

Cur Adv Vult

Both parties are bankers. Each of them in effect claims that it has a prior claim over a piece of freehold property known as No 28, Coldstream Avenue, Singapore (the property).

The relevant facts which are as simple as they are not controversial may be stated within a reasonably brief compass.
In April 1980, the plaintiff granted overdraft facilities up to the limit of $1m to both Gojo Hartono and Anitawati Sustanto upon the equitable mortgages of the property, two shop units and another landed property. Except for the property, the other properties equitably mortgaged to the plaintiff do not feature at all in these proceedings. The estimated value of the property in a mortgagee sale with vacant possession in March 1986 was said to be $593,000. The equitable mortgage of the property in favour of the plaintiff was created by the agreement of Gojo Hartono who signed a confirmation of deposit of title deeds dated 24 April 1980 whereby he agreed that the certificate of title relating to the property and issued under the Land Titles Act (Cap 157) (the Act) in the possession of the plaintiff was to be held `as security for the payment to (the plaintiff) on demand all moneys then owing or which should at any time thereafter be owing from A/C No 13959 of Mr Gojo Hartono and/or Mdm Anitawati Sustanto ...`. On 3 July 1980, a caveat bearing No CV/38908 was lodged by the plaintiff. Under s 109(1)(b) of the Act, this caveat lapsed and ceased to `affect land ... at the expiration of five years from the date of lodgment of the caveat`, ie the caveat lapsed on 3 July 1985 which is an important date to note as the plaintiff could have immediately on or before that date lodged a fresh caveat to protect its interest over the property. That the plaintiff had failed to lodge another caveat in good time has given rise to its present disputes with the defendant who had lodged a caveat to protect its interest, which had arisen only on 30 November 1985 and therefore later than the creation of the equitable mortgage, some two months and 24 days before the plaintiff lodged their fresh caveat on 26 February 1986. As will be seen from the following chronology of events, the plaintiff did not lodge their fresh caveat until some 7 months 23 days after the expiry of the first caveat referred to above.

The said Gojo Hartono and Anitawati Sustanto were also customers of the defendant.
By a judgment of the High Court dated 29 November 1985, the said Gojo Hartono was ordered to pay the defendant two sums aggregating over US$3m and interest. By order nisi made on 30 November 1985, it was ordered that the property or the interest of the said Gojo Hartono in the property shall `stand charged with the payment of the sum of US$2,949,613.06 and interest of US$67,841 and interest thereon at 8% pa from the date of the judgment to the date of payment ...`.

On 2 December 1985, the defendant lodged a caveat bearing No CV/21718A at the Registry of Titles claiming an interest in the property as `chargees of an estate in fee simple` by virtue of the above order nisi dated 30 November 1985.
On 22 January 1986, the order absolute imposing charge was granted by the High Court.

On 25 February 1986, the plaintiff as equitable mortgagee lodged a caveat bearing No CV/24130A against the property.

On 31 March 1986, the High Court on the application of the defendant ordered that the property be sold under its direction.
The plaintiff says that though the defendant had notice of the plaintiff`s caveat, the defendant did not draw the attention of the court to the caveat. On 4 April 1986, the order of sale was registered with the Registry of Titles. Eight days later a writ of seizure and sale was issued on the application of the defendant.

The plaintiff requested the defendant to withdraw its caveat but the defendant refused to do so.

By this summons the plaintiff claims against the defendant for the following reliefs:

1(i)(a) A declaration that Caveat No 21718A lodged by the defendant on 2 December 1985 has been wrongfully lodged and/or allowed by the defendant to remain wrongfully and/or without reasonable cause in the land register in respect of the Certificate of Title (Vol 218 Folio 59) as the said caveat is improper and bad in law; and/or

(b) a declaration that the alleged interest claimed by the defendant in Caveat No 21718A as `chargee of an estate in fee simple` by virtue of an order of court dated 30 November 1985 in Suit No 10253 of 1985 has ceased to be effective and/or has been rendered nugatory upon the making of the order absolute imposing charge on the property described in the schedule hereto; made on 22 January 1986 which ought to have been notified in the land register by means of a caveat and in the premises the said Caveat No 21718A has been allowed to remain wrongfully and/or without reasonable cause in the land register in respect of the Certificate of Title (Vol 218 Folio 59).

1(ii) For consequential orders resulting from the above declarations:

(a) ) that Caveat No 21718A be removed forthwith by the defendant to give effect to the above-mentioned declaration(s);

(b) ) that an inquiry be held by the Registrar of the Supreme Court to ascertain the damage and/or costs or expenses that had been sustained and/or incurred or continue to be sustained and/or incurred by the plaintiff until the date of removal of the Caveat No 21718A by the defendant; and

(c) ) that the defendant be ordered to pay to the plaintiff the amount so ascertained by the registrar.

(2) Further and/or alternatively: A declaration that in the event of a sale either by the sheriff or by a duly appointed receiver to enforce the charging order on the property described in the schedule hereto made absolute on 22 January 1986 such a sale shall, in accordance with the law, be subject to all the interests and rights of the plaintiff which has interests and rights in the said property, qua as a prior equitable mortgagee thereof, and which interests and rights have been duly notified by Caveat No 24130A lodged by the plaintiff on 26 February 1986.

(3) A declaration that the order of court dated 31 March 1986 obtained by the defendant for the sale of the property described in the schedule hereto under the...

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1 cases
  • City Development Ltd v Goh Yoke Hian and Others
    • Singapore
    • High Court (Singapore)
    • 23 February 1990
    ... ... ).The property had been purchased by the first defendant under an agreement for sale and ... charged in favour of the plaintiffs and the Bank of Montreal who will hold the security jointly ... the decision of Lai Kew Chai J in Bank of China v The First National Bank of Boston [1988] 3 ... ...

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