PUBLIC BANK BERHAD v JAYAENTHRAN A/L KRISHNAN

Case Significance

Confirms that a registrar has a genuine discretion in fixing the reserve price for the auction of charged land under the National Land Code, and that reducing the reserve in response to repeated failed auctions is a legitimate exercise of that discretion, not a mechanical error.

This High Court decision at Shah Alam concerns a challenge to the reserve price fixed for the auction of charged land in an order-for-sale execution, and the discretion of the registrar in setting that price. Following an order for sale made in 2018 in favour of the plaintiff bank under the charge provisions of the National Land Code, the plaintiff applied for directions to give effect to the sale. The Deputy Registrar granted an order in terms of that application, and the defendant chargor appealed, taking issue solely with the Deputy Registrar's determination of the reserve price. The defendant argued that the Deputy Registrar had erred in setting the reserve price and had denied him the right to be heard at the hearing where the price was decided.

The court examined how the reserve price had been arrived at. The property had already been through seven unsuccessful auctions, and the Deputy Registrar had set a reserve price of RM1,440,000, representing a ten per cent reduction from the previous reserve of RM1,600,000. The court rejected the contention that the Deputy Registrar had "mechanically" applied a ten per cent reduction: while the new figure did reflect a ten per cent reduction, it nonetheless constituted a fresh reserve price and did not contravene section 259(2)(c) of the National Land Code. It held that the Deputy Registrar had been entitled to take judicial notice of the seven previous failed auctions and, on that basis, to set the reserve at RM1,440,000.

The court affirmed the Deputy Registrar's order and dismissed the appeal, ordering the defendant to pay costs of RM1,000 to the plaintiff. The judgment illustrates that a registrar has a genuine discretion in fixing the reserve price for the auction of charged land, and that a reduction responding to repeated failed auctions is a legitimate exercise of that discretion rather than a mechanical error.