Perbadanan Kemajuan Pertanian Negeri Pahang (PKPP) v NADA RIMBA SDN BHD
cb-24ncvc-202-08-2025 High Court (Mahkamah Tinggi) 29 January 2026 • CB-24NCvC-202-08/2025 • 16 min read
5 cases cited
(0 SG, 5 foreign)
Catchwords
The dispute in this case concerned an application to stay court proceedings for the removal of private caveats pending arbitration. The dispute arose from the unilateral termination of a Joint Venture Agreement relating to parcels of land held under: (a) Hakmilik No. HS (M) 5189 PT 17651 Mukim Bentong; and (b) Hakmilik No. PM 3631 Lot 26178 Mukim Bentong. The Plaintiff, Perbadanan Kemajuan Pertanian Negeri Pahang, was the registered proprietor of the said lands. The Defendant, Nada Rimba Sdn Bhd, was appointed as the developer under a Joint Venture Agreement dated 28.8.2006 for the development of the said lands. Following the Plaintiff’s purported unilateral termination of the agreement on 5.4.2024 due to alleged project delays, the Defendant lodged private caveats over the lands on 27.3.2025, asserting subsisting contractual and beneficial interests. The Plaintiff commenced proceedings by way of Originating Summons under Section 327 of the National Land Code(“NLC”) seeking the removal of the private caveats. The Defendant opposed the application and applied for a stay of proceedings under Section 10 of the Arbitration Act 2005 (“AA”), contending that the dispute arose out of the Joint Venture Agreement, which contained an arbitration clause referring disputes to the Asian International Arbitration Centre. The Defendant argued that the validity of the termination and its continued interest in the lands were matters of contractual interpretation that fell squarely within the ambit of the arbitration clause. It contended that because there was a valid arbitration agreement, the Court was mandated under Section 10 AA to stay the proceedings. The Plaintiff, on the other hand, contended that the removal of a private caveat is a statutory remedy under the exclusive jurisdiction of the High Court and is not capable of settlement by arbitration. Relying on Section 4(1) AA and Federal Court precedent, the Plaintiff argued that land matters under the NLC form a comprehensive statutory scheme that cannot be contracted out of, making the dispute non-arbitrable on grounds of public policy. The issues for this Court’s determination were: (a) Whether the dispute concerning the removal of the private caveats was capable of settlement by arbitration within the meaning of Sections 4 and 10 of the Arbitration Act 2005; and (b) Whether the Court should stay the proceedings in favour of arbitration pursuant to Section 10 of the Arbitration Act 2005. Held, dismissing the application for stay with costs of RM2,000.00: 1. While Section 10 AA generally mandates a stay where a valid arbitration agreement exists, it does not apply to subject matter that is incapable of being resolved by arbitration. The power to remove a private caveat is expressly vested in the Court or the Registrar under Section 327 NLC, a power not conferred upon an arbitrator. 2. Following the Federal Court decision in Arch Reinsurance Ltd v Akay Holdings Sdn Bhd, the NLC is a complete and comprehensive legislative scheme. Statutory remedies regarding land tenure and encumbrances are non-arbitrable, and attempts to contract out of these provisions are void as being contrary to public policy. 3. The real issue before the Court was whether the Defendant possessed a caveatable interest and whether the caveats should be removed under the NLC. These are questions of statutory entitlement and public land administration, rather than mere contractual disputes arising from the Joint Venture Agreement. 4. The Defendant’s failure to initiate arbitration proceedings despite disputing the termination, while insisting the Plaintiff do so, was viewed a
Judges (1)
Counsel (5)
Statutes Cited
Cases Cited (5)
UK (1)
[1942] AC 356
MY (4)
[1984] 2 MLJ 87 [2019] 5 MLJ 186 [2022] MLJU 1723 [2024] MLJU 3754
Judgment
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