IN THE COURT OF APPEAL OF MALAYSIA (APPELLATE JURISDICTION)
CIVIL APPEAL NO. P-02-2087-2010
TEOH PHAIK SEE
RESOLUTION ALLIANCE SDN. BHD. … RESPONDENT
[In the matter of the High Court of Malaya in Penang Civil No. 24-561-2007
TEOH PHAIK SEE … PLAINTIFF
RESOLUTION ALLIANCE SDN. BHD … DEFENDANT]
MOHD HISHAMUDIN YUNUS, JCA ALIZATUL KHAIR BINTI OSMAN KHAIRUDDIN, JCA
LIM YEE LAN, JCA
JUDGMENT OF THE COURT
 The appeal before us emanates from the decision of the High Court of Penang dated 23.6.2010, dismissing the Appellant’s claim for specific performance of a Memorandum of Contract issued to the Appellant by Malayan Banking Berhad (MBB) (predecessor of the Respondent) upon the Appellant’s successful bid for a property at an auction sale held by MBB on 28.9.2006 at a purchase price of RM190,000.00 (“the Sale”) and awarding damages in lieu of specific performance to be assessed. There was a cross-appeal by the Respondent on the award of damages to the Appellant.
 On 28.8.2012 by a unanimous decision we dismissed the Appellant’s appeal and allowed the Respondent’s cross appeal. We now set out the grounds for our decision.
 The background facts giving rise to the dispute can be summarised as follows.
 The property put up for auction was an apartment known as Unit 5611-12, Jalan Wee Hein Tze, Cara Vista Apartment, 11200 Tanjung Bungah, Pulau Pinang (“the Property”). It was originally purchased by one Lim Siew Lay (“Borrower”) from a company known as Tunda Enterprise Sdn Bhd (“Developer”) under a Sale and Purchase Agreement dated 19.8.1996 (“SPA”).
 The Borrower obtained a loan from Pacific Bank to finance the purchase of the Property. As the individual strata title to the Property was then had not been issued yet, the security given by the Borrower for the repayment of the loan was by means of a Loan Agreement cum Assignment Agreement dated 25.3.1997 (“LCA”) wherein the Property was absolutely assigned to Pacific Bank as security.
 The Loan and LCA were subsequently assigned to MBB who, upon the default by the Borrower, put up the Property for sale by way of an auction under a Proclamation of Sale dated 28.9.2006.
 The Proclamation of Sale described the legal status of the Property as follows:
Brief particulars of strata title in expectancy
The subject property has been issued with a strata title document Floor Area 1,356 square feet (126 square metres)
Developer/Proprietor TUNDA ENTERPRISE SDN. BHD.
 The Proclamation of Sale further states that the auction sale of the Property was “ [I]n the exercise of the rights and powers conferred upon the Assignee/bank under the Loan Agreement Cum Assignment Agreement both dated 25 March 1997 entered into between the Assignee/Bank and Assignor/Borrower…’’.
 At the conclusion of the auction, the Plaintiff was declared the successful bidder. The Plaintiff paid a sum of RM9,500.00 representing 5% deposit of the purchase price and signed a Memorandum of Contract (see pg 200 of the AR) on the same date in which she was declared “the successful bidder and purchaser for the Property at a purchase price of RM190,000.00”.
 After the Sale, the Plaintiff’s solicitors wrote a number of letters to MBB’s solicitors asking the letters to deliver the relevant documents in order to complete the Sale, including a copy of the SPA between the Borrower and the Developer, the Loan Cum Assignment Agreement, the Power of Attorney between the Borrower and MBB and the strata title.
 No response was received from MBB or its solicitor to the Plaintiff’s solicitor’s letters. The Plaintiff vide her solicitor’s letter dated 1.3.2007 then gave notice to MBB to proceed with the Sale within two weeks from the receipt of the letter failing which legal proceedings for specific performance will be instituted without further notice.
 By a letter dated 24.4.2007 addressed to the Plaintiff’s solicitor, MBB wrote as follows:
The above auction property and auction date refers.
Pursuant to our undertaking under the Proclamation of sale dated 28/08/2006; regret to inform you that the Management has decided to terminate the auction sale in view that the transfer of the Property to the successful bidder cannot be perfected.
We hereby treat the Memorandum of Contract dated 28/08/2006 as null and void and enclosed is a banker’s cheque amounting to RM 9,500.00 payable to the bidder, Teoh Phaik See, being the reimbursement of the 5% deposit paid.
We apologise for any inconvenience caused and we look forward for your client’s future business with us.
 Aggrieved by the decision of MBB, on 10.4.2007 the Plaintiff filed an Originating Summons (OS) followed by an Amended OS on 2.4.2009 at the Penang High Court, in which she sought the following reliefs against the Respondent:
(1) specific performance of the Memorandum of Contract and damages in addition or in lieu thereof;
(2) extension of time to complete the Sale;
(3) an order that the Defendant to forward a duly executed Form 14A and all relevant documents of strata title Grant No. 47102/M1/2/2 in respect of the Property for the purpose of the
registration of the transfer within one month of the court order failing which the Senior Assistant Registrar of the High Court shall execute the Form 14A for the purpose of the registration of the transfer of the Property at the relevant Penang Land Office;
(4) damages for late delivery to be assessed;
(5) general damages; and
(6) interests and costs.
 Subsequently, vide a Supplementary Affidavit filed on 12.6.2009, the Appellant further claimed for general, special, aggravated, exemplary and punitive damages amounting to RM1,070,550.00 caused by MBB’s fraud, fraudulent misrepresentation and negligence as particularised in the said Supplementary Affidavit (see p. 75 of A.R. Jilid 2 Bahagian B).
 The Loan and LCA were subsequently vested in the Respondent vide a vesting order dated 17.4.2008. The Respondent vide a Summons in Chambers dated 14.11.2008 applied to substitute itself for MBB as the Defendant.
High Court Decision
 On 23.6.2010 the High Court dismissed the Appellant’s claim for specific performance but ordered damages in lieu of specific performance to be assessed. No written grounds of judgment were delivered by the learned Judicial Commissioner. The appeal was therefore conducted by way of a rehearing.
Submissions before us
 Set against the undisputed factual background as outlined above, the Appellant in her Memorandum of Appeal cited the following main grounds of appeal:
(i) The learned Judicial Commissioner erred in fact and in law in refusing to grant specific performance of the Sale under the Proclamation of Sale; and
(ii) The learned Judicial Commissioner erred in fact and in law in failing to determine that the Respondent as the attorney of the Borrower could effect a direct transfer of the Property to the Appellant and its refusal to do so amounted to a breach of the Memorandum of Contract.
 At the hearing before us, parties filed in written submissions supplemented by oral submissions of counsel. Learned counsel for the Appellant raised the following main points of argument why this appeal should be allowed:
(a) The Appellant is a bona fide purchaser for value at the public auction and has obtained a good and registrable title to the Property free from all encumbrances and defects;
(b) The Respondent allegedly terminated the Sale on the ground that there was an error in the Proclamation of Sale in which it was stated that the strata title to the Property had been issued when in actual fact it had not been issued;
(c) The error or description in the title of the Property is a mere misnomer or mis-description which does not nullify the auction which to date has not been set aside;
(d) If the Respondent contended that it could not proceed with the public auction because there was an error in the Memorandum of Sale, the right thing for it to do was to have applied to the court to set aside the auction but the Respondent never did. The contract is therefore still in force and binding on the Respondent (see Hanafiah Muhammad v Southern Bank Bhd &Ors  9 CLJ 640);
(e) Reliance was also placed on the case of People Realty Sdn Bhd v Hong Leong Bank Bhd & Anor  1 CLJ 73 in which it was held that any challenge by the appellant (chargor) regarding the non-compliance of the court’s directions by the chargee bank on the auction sale could not affect the indefeasible title of the
second and third respondents (the successful purchasers at the auction) over the said land. Similarly, here the error in the description of the title of Property could not nullify the Sale and the Appellant had obtained a good and registrable title to the Property;
(f) The Respondent’s claim that it had to terminate the public auction because “the transfer of the Property to the successful bidder could not be perfected” is without basis. The Appellant would rely on the case of Hong Leong Bank Bhd v Goh Sin Khai  3 CLJ 16 wherein it was held that there is no law that stated that once an individual title or strata tile is issued, the absolute assignment is extinguished. The Respondent here has an Assignment and Power of Attorney under the LCA and is in a position to effect a direct transfer of the Property as the attorney of the Borrower and can deliver a good title to the Appellant;
(g) The learned Judicial Commissioner gave no reason why he did not grant specific performance. It did not however matter as the facts here are undisputed and based on the law it is clear that the Appellant is entitled to specific performance of the Sale;
(h) On damages, it was submitted that the Respondent is liable for damages for fraud, negligence, breach of contract and duty of care;
(i) The Respondent has given no valid reason why it refused to complete the Sale when it was able in law to do so. The real reason the Respondent refused to complete the Sale was because the value of the property had gone up;
(j) The Respondent had treated the Appellant in a callous and cavalier manner and forced her to employ solicitors and incur legal fees, expenses and disbursements to file the OS to enforce her right under the Sale. The Respondent had also deliberately delayed completing the sale;
(k) The Respondent refused to abide by the Sale on vexatious and frivolous grounds and is therefore liable for aggravated, punitive and exemplary damages as detailed in the Appellant’s Supplemental Affidavit dated 12.6.2009 (see A.R. Jilid 2 Bahagian B at page 74-80);
(l) In conclusion, it was submitted that the Appellant’s appeal on specific performance of the Memorandum of Sale should be allowed with costs.
 Learned counsel for the Respondent, on the other hand, submitted before us that there was no merit in the Appellant’s appeal to justify any appellate intervention on the part of this Court. He cited the following grounds in support of his contention:
(i) The Respondent had lawfully terminated the Sale and the Respondent is not entitled to specific performance and or damages against the Respondent;
(ii) The Respondent in its Affidavit in Reply to the OS had explained that the Sale had to be terminated because it was discovered after the public auction that strata title of the Property had already been issued, transferred and registered in the name of the Borrower since 12.2.1999 (see strata title on pg 127 of the AR);
(iii) It is clear from the Proclamation of Sale that the auction sale was conducted on the basis that the Property was still held in the name of the developer (see Proclamation of Sale on pg. 93 A.R. Jilid 2 Bahagian C);
(iv) It is also clear from the first paragraph and paragraph 10 of the Proclamation of Sale that the foreclosure of the Property was in the purported exercise of the Respondent’s contractual rights under the LCA as an assignee of all the rights and benefits of the Borrower under the SPA with the developer;
(v) Premised on this assumption, the auction of the Property was carried out without obtaining an order of Court. This procedure was perfectly legal as was established in the case of Phileoallied Bank (M) Bhd v. Bupinder Singh a/I Avatar Singh  2 MLJ 513, in which the Federal Court held that a lender placed in the
position of MBB is an equitable mortgagee; that in the absence of any statutory provision or any rule of principle in common law requiring an equitable mortgagee to obtain a court order to realize its security under an absolute assignment of rights to land, an equitable mortgagee does not require a Court order pursuant to Order 83 of the Rules of the High Court 1980 (“RHC 1980”) to exercise its right to foreclose the property; and the Court should give effect to and recognise the contractual rights as determined between the vendor and the purchaser;
(vi) It was further submitted that what MBB proposed to sell under the Proclamation of Sale was not the legal title in the Property (which it did not possess as an equitable mortgagee) but its chose in action in the Property, namely, all the Borrower’s rights and benefits assigned to it under the SPA and LCA. This has been succinctly explained in the case of Hong Leong Bank Bhd v. Goh Sin Khai  3 MLJ 154 at 175 (Goh Sin Kai) in the following manner:
In the local context, however, when the mortgagee exercises the power of sale under an assignment, he does not seek to convey the legal estate in the property to the purchaser. He only conveys the equitable estate to the purchaser. This is accomplished by transferring the legal right to the chose in action absolutely to the purchaser through another absolute assignment.
It was further explained in Goh Sin Khai at p. 177 para 6 as follows:
In our local context, legal title (the English equivalent of the legal estate) vests with the developer until the property is transferred to the assignor or mortgagor. The assignor or mortgagor has a right to require a transfer of that legal title from the developer once title has been issued. This right is the chose in action that has been absolutely assigned or transferred to the assignee or mortgagee. The mortgagee then when exercising the power of sale assigns or transfers not the legal title to the subsequent purchaser but the chose in action that enables the purchaser to require the developer to transfer the legal title or estate to him directly.
(vii) Applying the legal principle laid down in Goh Sin Khai to this case, it is clear that what a successful bidder would receive under the Memorandum of Contract was an assignment of the Respondent’s right to require the developer to transfer the legal title to the Respondent as and when the individual strata title to the Property is issued;
(viii) This intention or purport of the Sale is clearly reflected in clause 10 of the Proclamation of Sale (see pg 202 of the AR) which reads as follows:
Upon full payment of the balance purchase price in accordance with Clause 8 above, the Assignee / Bank shall execute or cause to be executed as soon as possible at the Purchaser’s costs and expense (including but not limited to legal fees, stamp duty and registration fees) an Assignment in favour of the Purchaser of all the right and benefits in
the Property and under the Principal Sale and Purchase Agreement upon the terms and conditions stipulated by the Assignee/bank. Thereafter and upon the purchaser’s payment of all such costs and expenses of the Assignment, the Assignee/Bank shall deliver to the purchaser or his solicitor the duly executed Assignment, the original Principal Sale and Purchase agreement and the previous Assignment.
(ix) Hence, the contention of the Appellant that under the Memorandum of Contract she had acquired from the Respondent a legal and registrable title to the Property is without basis;
(x) In any case, the execution of the assignment of the chose in action of the Respondent under the LCA in favour of the Appellant as provided in clause 10 of the Proclamation of Sale would also be in vain as there was no longer a chose in action to be assigned. Neither would the Appellant be able to enforce the assignment against the developer (Tunda Enterprise Sdn Bhd) who itself no longer had any legal title in the Property to be transferred to the Appellant;
(xi) In the circumstances, the Respondent had no choice but to terminate the Sale, which it was entitled to do so under clause 18 of the Proclamation of Sale, which reads as follows:
In the event of the sale being set aside for any reason whatsoever by the Assignee/Bank or by an Order of Court or consent not being obtained from the Developer/ Proprietor or any other relevant
authority (other than due to the act of default and/or omission by the Purchaser) this sale shall become null and void and be of no further effect and the Assignee / Bank shall refund the deposit and other monies (if any, paid herein by the Purchaser to the Assignee / Bank) to the Purchaser, free of interest and the Purchaser shall not be entitled to any claim and demand whatsoever against the Assignee /
Bank or any other party on account thereof.
(xii) Pursuant to its power under clause 18 MBB had duly terminated the Sale and refunded the 5% deposit vide its letter dated 24.4.2007 which was accepted by the Appellant;
(xiii) In regard to the Appellant’s submission, in reliance on the cases of Hanafiah Muhammad and People Realty Sdn. Bhd., that the only way to set aside the Sale was for the Respondent to apply to the Court, it was submitted that such a contention was clearly misconceived;
(xiv) Hanafiah Muhammad and People Realty Sdn Bhd involved sales of immovable properties pursuant to an order of court under Order 83 of the RHC 1980, and were therefore subject to the direction and supervision of the Court; unlike this case which was a private contractual sale based on the terms of the Proclamation of Sale;
(xv) Clause 18 of the Proclamation of Sale allowed the Respondent to set aside the Sale for any reason whatsoever and there was no
necessity for the Respondent to apply to the Court to set aside the Sale;
(xvi) It was further submitted that this is a peculiar case in which although the strata title had been transferred to the Borrower in 1992, the charge over the Property was never registered or perfected in favour of Pacific Bank or MBB;
(xvii) Clause 14.3 of the LCA had expressly provided that upon the issuance of the strata title by the relevant authority, Borrower/Assignor “will take a transfer thereof, execute and perfect the charge over the Property in favour of MBB”. No charge had been perfected in favour of the Respondent by the Borrower/Assignor on the date of the auction;
(xviii) In such a situation, decided authorities in this country would recognise a lender/financier in MBB’s position as an equitable chargee (see Bank Pembangunan dan Infrastruktur Malaysia Bhd (formerly known as Bank Pembangunan Malaysia Bhd) v Omar bin Haji Ahmad  1 MLJ 810 (Bank Pembangunan dan Infrastruktur Malaysia);
(xix) Reliance is placed on the following passage Bank Pembangunan dan Infrastruktur Malaysia at p. 816 para  which reads as follows:
… While it is true that that the factual matrix could not have created any legal charge, ‘our courts have resorted to equitable principles and consistently held that an agreement or an arrangement to secure a debt in favour of the creditor in respect of the debtor’s land creates an equitable charge giving rise to an equitable right in favour of the creditor, although no charge or lien, within the provisions of the National Land Code or the previous Code is executed or created’: per Salleh Abas CJ (Malaya) (later LP) in Mahadevan & Anor v Manilal & Sons (M) Sdn Bhd  1 MLJ 266 at p270I rt (FC)…His lordship asserted that there is ‘no provision in the National Land Code prohibiting the creation of equitable charges and liens. The Code is silent as to the effect of securities which do not conform to the Code’s charge or lien. Therefore equitable charges and liens are permissible under our land law”: at p 271IF left.
(xx) It was submitted that as MBB’s position had altered from an equitable mortgagee to an equitable chargee, its power to enforce or realise the Property as security is subject to Order 83 of the Rules of the High Court 1980 (“RHC”) which reads:
(1) This Order applies to any action (whether begun by writ or originating summons) by a chargee or chargor or by any person having the right to foreclose or redeem any charge, being an action in which there is a claim for any of the following reliefs namely-
(b) sale of the charge property;
(2) In this Order “charge” includes a legal and an equitable charge.
(xxi) Order 83 rule 1(2) of the RHC 1980 clearly includes an equitable charge under the definition of a charge;
(xxii) The strict requirement to obtain a court order to sell a charged land is reiterated in the case of Kimlin Housing Development Sdn Bhd (Appointed Receiver And Manager) (In Liquidation) v Bank Bumiputra (M) Bhd & Ors  2
MLJ 805 in which the Supreme Court held at 807 under holding (4):
36. The provisions of the NLC as to the rights of chargors are designed for their protection and could not be waived nor could the chargor contract himself out of the NLC. It follows, therefore, that no power of sale could be conferred by a chargor under the NLC on a chargee himself by way of a debenture or power of attorney or otherwise, but proceedings must be brought by the chargee to obtain a judicial sale in accordance with the procedure laid down in the NLC.”
(xxiii) In this case, upon realising the real legal status of the Property, MBB could not have proceeded with the auction sale without obtaining a court order, as required by Order 83 rule 1(2) of the RHC;
(xxiv) Had the Respondent proceeded further with the Sale, there was a likelihood of it being challenged by the Borrower/ Assignor for non-compliance with the law. The Sale could be
struck down as an illegal sale and thus void under section 24 of the Contracts Act 1950. It is also unlikely that the Court would sanction the Sale as it would tantamount to the Court defeating the purpose of Order 83 of the RHC;
(xxv) In regard to the Appellant’s reliance on the case of Goh Sin Khai in which the High Court held that an equitable mortgage is not extinguished merely upon the issuance of a strata title and an equitable mortgagee is not required to obtain an order of court for sale of the assigned property, it was submitted that, unlike the instant case, the facts in that case were not clear as to whether the strata title was still in the developer’s name and or has not been transferred to the Borrower. In any case, a perusal of the decision would indicate that the High Court there recognized that an equitable charge can arise after the individual title is issued and the assignment extinguished (see pg. 166 of the Judgment at paragraph 22);
(xxvi) In this case, not only was the individual strata title issued in respect of the Property, but it was transferred to and registered in the name of the Borrower by the developer since 12.2.1999. Hence, Goh Sin Kai is patently not relevant to this case based on the facts;
(xxvii) It was further submitted that courts will not grant specific performance where a contract is in its nature a
revocable contract. This is clearly specified in section 20 of the Specific Relief Act 1950 which reads:
20 (1) The following contracts cannot be specifically enforced –
(d) a contract which is in its nature revocable.
(xxviii) In the case of Jumbo Top Sdn. Bhd. v. Automotive Corp (M) Sdn. Bhd.  1 MLJ 718 it was held, inter alia, that since Clause 7.4 of the dealership agreement specifically provides that either party may terminate the agreement at any time by giving two months’ prior notice in writing to the other, the plaintiff was not entitled to specific performance of the contract under section 20(1)(d) of the Specific Relief Act 1950;
(xxix) In this case, clause 18 of the Proclamation of Sale entitles MBB to unilaterally terminate the Sale, thus invoking the applicability of section 20(1)(d) of the Specific Relief Act;
(xxx) Lastly, it was also contended that the Appellant’s prayer in her Amended OS for the Respondent to effect a direct transfer of the Property to her by way of an instrument of transfer in Form 14A in its capacity as the attorney of the Borrower/Assignor, is, in view of the foregoing discussions, misconceived. As previously discussed,
this was clearly an attempt by the Appellant to re-write the terms of the auction sale as agreed to in the Proclamation of Sale;
(xxxi) For the above reasons, it was submitted that the Appellant’s appeal on specific performance is devoid of merit and ought to be dismissed by this Court;
(xxxii) In regard to the Respondent’s cross-appeal on damages, learned counsel submitted that the learned Judicial Commissioner erred in awarding damages to the Appellant, for the following reasons:
(1) As stated earlier, Clause 18 of the Proclamation of Sale entitles the Respondent to terminate the Sale and the Respondent had done so vide its letter dated 24.4.2007 to the Appellant’s solicitor. There was therefore no breach of contract on the part of the Respondent;
(2) Clause 18 limits the claim of the Appellant to the refund of the 5% deposit free of interest upon the termination of the Sale and also prohibits the Appellant from making any other claim or demand whatsoever against the Respondent;
(3) The Respondent has already made full refund of the 5% deposit to the Appellant on 24.4.2007 and the Appellant
had accepted the same (see page 199A of AR, Bahagian C, Jilid 2). There is therefore no basis to claim for any other damages;
(4) The Appellant’s claim for special, aggravated damages, exemplary and punitive damages founded on the ground of fraud, negligence were never part of her case in the Amended OS;
(5) The Appellant’s case as pleaded in her Amended OS was for breach of contract, in which she prayed for the following remedies:
(i) Specific performance in addition to damages and or in lieu thereof;
(ii) Damages for late delivery;
(iii) General damages.
(6) The various heads of damages for special, aggravated, exemplary and punitive damages were claimed in her Supplementary Affidavit affirmed on 12.6.2009 (“Supplementary Affidavit”);
(7) It was held in Teo Ai Teng v. Yeo Khee Hong  9
MLJ 721 that remedies that are not pleaded in the originating summons or the affidavit in support are liable
to be dismissed. The Plaintiff’s Supplementary Affidavit is not an affidavit in support of her claim in the Amended OS;
(8) It is trite that parties are bound by their pleadings. The Supreme Court in Yew Wan Leong v Lai Kok Chye  2 MLJ 15 held, inter alia, that as the High Court there had made a decision on an issue which was not raised by the parties in their pleadings, the appeal must be allowed and the order of the learned judge in dismissing the plaintiff’s claim set aside;
(9) Further, the plea of fraud and negligence in an action begun by way of an originating summons is an abuse of process as Order 5 rule 2 of RHC 1980 has clearly provided that such proceedings must be begun by a writ;
(10) In any event, the Appellant had not adduced any evidence in her Supplementary Affidavit to support her allegations of fraud and fraudulent misrepresentations on the standard of beyond reasonable doubt (see Yong Tim v. Hoo Kok Chong  3 CLJ 229 and Eastern & Oriental Hotel  Sdn. Bhd. v. Ellarious George Fernandez  1 MLJ 35);
(11) It is also trite that a party seeking substantial damages must prove the actual loss suffered. The Appellant here had clearly failed to adduce any evidence to prove the losses suffered under any of the heads of damages claimed. In Tan Sri Khoo Teck Puat v. Plenitude Holdings Sdn. Bhd.  3 MLJ 777 at 784, the Federal Court in awarding nominal damages of RM10 said:
“…we are reminded of the words of Lord Goddard in Bonham-Carter v Hyde Park Hotel Ltd 64 TLR 177 at p 178:
.plaintiffs must understand that if they bring actions for damages it is for them to prove their damage; it is not enough to write down the particulars, so to speak, throw them at the head of the court saying: ‘This is what I have lost, I ask you to give me these damages’. They have to prove it.”
(12) Similarly, in this case, what the Appellant had done in her Supplementary Affidavit was simply to write down the particulars of damages and ‘throw them at the head of
the court’. No evidence was adduced to prove the actual losses suffered. Consequently, it is pointless to even have damages assessed by the SAR under these heads. Even
if any damages were to be awarded (which is denied), the
Appellant would at most be entitled to only nominal damages;
(13) Alternatively, the Appellant in accepting the return of the deposit had essentially abandoned her claim for specific performance and cannot be entitled to damages as well. This has been illustrated in the case of Labasama Group (M) Sdn. Bhd. v. Insofex Sdn. Bhd.  3 MLJ 310 at 313 E-G where this Court held:
The essence of the respondent’s claim in the circumstances of this case is for specific performance and the claim for damages for breach of agreement must necessarily be regarded as an alternative claim. They cannot get both remedies. If they claim for specific performance, they are treating the agreement as still subsisting and wants the other party to perform it. If their claim is for damages for breach, they are treating the agreement as having come to an end and therefore incapable of being performed. As stated earlier the essence of the respondent’s claim is for specific performance and once they abandon this claim, they have altered their claim and their pleadings cannot stand for the purpose of their alternative claim for damages for breach. They therefore ought to amend their pleadings and without doing so, the learned judge ought not to have ordered damages to be awarded to them. The respondent cannot be allowed to change the whole nature of their claim which essentially is a claim
for specific performance, by turning it into an ordinary action for damages. (See Hipgrave v Case (1885) 28 Ch D 356).
(14) The Appellant had also failed to prove that when the Respondent terminated the Sale, it had acted with malicious intent to reap some sort of profit.
It follows that the claim for aggravated, punitive and exemplary damages cannot be allowed (see Bumiputra-Commerce Bank Bhd v Top-A Plastic Sdn Bhd  5 MLJ 34).
 For the foregoing reasons, the Respondent prays for the Appellant’s appeal to be dismissed and the Respondent’s cross-appeal to be allowed.
 It is clear from the facts narrated above and the respective submissions of parties that the sole issue in this appeal is whether, upon the issuance of the strata title to the Property by the State Authority to the developer and the transfer of the title to the Borrower/Assignor by the developer, MBB can continue to exercise its rights and powers as an assignee under the LCA, including enforcing its security over the Property by way of sale without having to obtain an order of Court?
 In this regard, learned counsel for the Appellant had relied on the case of Goh Sin Khai, in which Syed Ahmad Helmy J (as he then was) had, inter alia, held that the issuance of a title to a property held as a security under an assignment will not extinguish the absolute assignment and the assignee (the lender bank) can continue to sell the property under the terms of the assignment, without having to apply for a court order for the sale.
 On the other hand, learned counsel for the Respondent relied on the case of Bank Pembangunan dan Infrastruktur Malaysia in which this Court had held that in such a case a lender/financier (in the position of MBB) had become an equitable chargee and by virtue of Order 83 of the RHC 1980, which includes within its scope an equitable charge, MBB had to obtain an order of court before it could sell the Property.
 Having read the judgments of the two cases carefully and the terms of the LCA, we are inclined to agree with the submission of learned counsel for the Respondent that once the strata title to the Property was issued and transferred to the Borrower/Assignor, MBB could no longer exercise its contractual right of sale under the LCA and must obtain a court order in order to do so. We say so for the following reasons.
 In Goh Sin Khai, it is clear that the learned Judge’ s findings that ” [T]here is no statute or rule in common law that once an individual
title or strata title is issued, the absolute assignment is extinguished” are predicated on two pre-conditions, i.e. (i) unless the contractual provisions in the assignment provide that it is extinguished upon the issuance of an individual or strata title and (ii) unless the assignment imposes an obligation on the assignee to ensure that the title is transferred to the assignor and a charge is registered.
 In our judgment, the two pre-conditions in Goh Sin Khai are found in Clauses 14 and 17 of the LCA. While clause 14.3 provides that “upon the issue of the Title to the Unit by the relevant authorities the borrower shall at the Borrower’s own costs and expense and upon being so required to do so by the Bank take a transfer thereof, execute and perfect the charge over the Unit, Clause 17 stipulates that “the LCA shall remain in force until and unless the transfer and charge referred to in clause 14.3 are duly registered against the title to the unit or the whole of the moneys secured by the Unit are paid in full, whichever happens first”.
 Although one might argue that clause 14.3 and clause 17 read together would imply that the LCA will not be extinguished unless and until the strata title to the Property had been transferred to the Borrower/charger and the charge had been duly registered against the said title, the fact still remains that on the date of the auction, MBB could no longer consider itself as the “ absolute unencumbered owner thereof” as provided in clause 11.1 of the LCA and to purport to exercise its power of sale under the LCA as if it was the absolute
owner. This is because such an argument would run counter to the provisions of the NLC which already recognised the Borrower/Assignor as the indefeasible proprietor of the Property free from all encumbrances (in the absence of the charge) since 1992. At best, what can be argued is that by virtue of clause 14.3 and clause 17, MBB’s, and now the Respondent’s, right to perfect a charge against the strata title to the Property remains intact and was never extinguished.
 We are thus inclined to agree with the approach taken by this Court in Bank Pembangunan dan Infrastruktur Malaysia (which followed the Federal Court’s decision in Mahadevan) that on the date of the Proclamation of Sale MBB must be considered an equitable chargee of the Property.
 It is perhaps useful at this juncture to examine the rationale given by this Court in Bank Pembangunan dan Infrastructure Malaysia as
to why an equitable charge existed in that case.
 In Bank Pembangunan dan Infrastructure Malaysia what happened was that a third party charge of a Malay reserve land was executed by the borrower in consideration of a loan from the bank, but the charge was not registrable under the NLC because it was wrongly attested by an advocate and solicitor instead of a land administrator as required by section 211 read with para 3(1) of the Fifth Schedule to the NLC, which applies to a Malay reserve land.
The Court, however, held that it did not matter as what is important is that there was an express antecedent agreement by the borrower to provide security for the loan which the bank had given to him and his execution of the charge was cogent evidence of such antecedent agreement which gave rise to an equitable charge in favour of the bank pending the execution and registration of a proper charge.
 Applying Bank Pembangunan dan Infrastruktur Malaysia to this case, we would similarly hold that there was an antecedent agreement by the Borrower under clause 14.3 of the LCA to create and perfect a charge over the Property in favour of MBB upon the issuance of the strata title to the Property and transfer thereof to herself and until a legal charge is registered in favour of MBB under the NLC, an equitable charge existed in favour of MBB.
 We further agree with learned counsel for the Respondent that as MBB had become an equitable chargee with effect from 12.2.1999, and since Order 83 of the RHC 1980 defines a charge as including an equitable charge, the sale of the Property would necessarily require an order of the court.
 Since the auction in this case was conducted without an order of the court, no valid sale under the Proclamation of Sale had come into being between the Appellant and Respondent, to entitle the Appellant to seek specific performance of the Memorandum of Contract.
 We further fully agree with learned counsel for the Respondent that even if the Memorandum of Contract operates as a valid and binding contract, it by no means was an instrument of transfer within the meaning of the NLC which is capable of being presented for registration under the NLC.
 This is in contrast to a certificate of sale in Form 16F of the NLC issued by the Court to a successful purchaser under a judicial sale, which is recognised as an instrument of dealing under section 292(1)(d) of the NLC and capable of being presented for registration at the appropriate land office, and once registered will confer an indefeasible title to the purchaser under section 340 of the NLC.
 We are of the further view that the Appellant was misconceived when she claimed that under the Memorandum of Contract she was a bona fide purchaser for value of the Property.
 It is not in dispute that after her successful bid for the Property the Appellant did pay 5% of the purchase price as deposit.
 However, under Clause 10 of the Proclamation of Sale, it is clear that an Assignment will be executed by MBB to the successful bidder only “upon the full payment of the balance purchase price in accordance with clause 8 above” (which is 120 days from the date of the auction sale).
 In this case, having only paid 5% of the purchase price as deposit, the Appellant cannot in law be considered a bona fide purchaser for value who has acquired a legal and indefeasible title over the Property. Indeed, this is also true of a certificate of sale under Form 16F of the NLC, which by virtue of 265(4)(a), will be issued to a successful purchaser only if he/she has paid the full purchase price of the auctioned property.
 Hence, learned counsel for the Appellant’s reliance on the cases of People Realty Sdn Bhd and Hanafiah Muhammad was
misconceived because in both these cases the successful purchasers had settled the full purchase price and were issued with a certificate of sale in Form 16F by the Court and had been registered as the proprietors of the auctioned properties.
 For the above reasons, we dismissed the Appellant’s appeal with costs.
 We now come to the Respondent’s cross-appeal on damages awarded to the Appellant to be assessed by the SAR. In the absence of the grounds of judgment from the learned Judicial Commissioner, we do not have the benefit of his rationale as to why he awarded damages in lieu of specific performance to the Appellant.
 Be that as it may, since it is our finding that there was no legally enforceable contract between the Respondent and the Appellant
under the Memorandum of Contract, the question of breach of contract on the part of the Respondent did not arise.
 In any event, as rightly pointed out by learned counsel for the Respondent, even if there was a legally enforceable contract, it has been lawfully terminated by the Respondent pursuant to clause 18 of the Proclamation of Sale.
 Clause 18 of the Proclamation of Sale also clearly limits the claim of a bidder, in the event of the termination of a sale, to the refund of the 5% deposit paid. The Appellant was therefore not entitled to any other claim other than the refund of the 5% deposit paid by her. The Appellant could not be heard to complain as that was the bargain she had entered into when she went into the bidding.
 In view of our foregoing findings, the Appellant’s claim for special, aggravated, exemplary and punitive damages specified in her Supplementary Affidavit based on fraudulent misrepresentation, fraud and negligence have no legal basis.
 We further agree with learned counsel for the Respondent that in any case the Appellant’s purported claim for damages based on fraud, fraudulent misrepresentation and negligence in her Supplementary Affidavit cannot be entertained by the Court as it did not comply with rules of court.
 The relevant rule of court in Order 5 rule 2 of RHC 1980 expressly provides that all actions based on fraud, fraudulent misrepresentation and negligence must begin by way of a writ. Order 5 r 2 of the RHC 1980 ( now Order 5 r 2 of Rules of Court) reads as follows:
Rule 2. Proceedings which must be begun by writ. (O. 5 r. 2)
Subject to any provision of any written law or of these rules, by virtue of which any proceedings are expressly required to be begun otherwise than by writ, the following proceedings must, notwithstanding anything in rule 4, be begun by writ, that is to say, proceedings-
(a) in which a claim is made by the plaintiff for any relief or remedy for any tort, other than trespass to land;
(b) in which a claim made by the plaintiff is based on an allegation of fraud;
 This Court in the recent decision of Husli Mok v. Jundar Realty Development Sdn Bhd & Anor  2 CLJ 205 had the occasion to reaffirm the legal principle in Order 5 rule 2(a) and (b) that claims founded on fraudulent misrepresentations and fraud must be commenced by a writ action. In that case, the appellant, who had erroneously filed the action by way of originating summons for fraud and fraudulent misrepresentation on the part of the respondent, did make an oral application to convert the originating summons to a writ
action. The High Court Judge, however, turned down the appellant’s oral application and ordered the hearing to proceed forthwith. At the end of the hearing the High Court Judge found that, on the affidavits, there were no fraud or misrepresentation. Upon appeal by the appellant, this Court held that the High Court Judge had erred in law in not allowing the appellant’s oral application. It was held, inter alia, that in light of the conflict of evidence in the respective Affidavits of the parties, the High Court Judge should have acceded to the appellant’s oral application and converted the originating summons action to a writ action and proceeded with the matter in the manner as prescribed by O. 28 r. 8(1) of the Rules of the High Court 1980: to order that the affidavits be deemed to be pleadings, with liberty to any party to apply for particulars; or alternatively, to issue directions to the parties to file their respective pleadings. The matter was then directed to be remitted to the High Court to be heard de novo as a writ action before another judge.
 Applying the aforesaid authority to this case, we are of the view that the Appellant in this case should have applied to convert her Amended OS into a writ action and to amend her pleadings for her purported claim based on fraud, fraudulent misrepresentation and negligence. It is however clear from the submissions of parties that this step was never taken by the Appellant. In any case, the particulars affirmed in the Appellant’s Supplementary Affidavit were too brief and sketchy to support an action based on fraud, fraudulent misrepresentation or negligence.
 There is just one final point we wish to deal with and it is this. It was contended by the Appellant’s Counsel that the Memorandum of Contract was never lawfully terminated by the Respondent who should have applied to the Court to set it aside rather than terminating it through a letter, reliance being placed on the case of Hanafiah Muhammad (supra).
 Having perused the facts in Hanafiah Muhammad, we found that it has no application to the case before us. What happened in Hanafiah Muhammad was that there was a mistake in the address of the property to be auctioned in the advertised proclamation of sale. On the date of auction, the mistake was informed to members of the public in the auction room by the Deputy Registrar and the auctioneer and necessary correction was made to the proclamation of sale and the public auction then proceeded. The second and the third defendants were the successful bidders. The Plaintiff, owner of the charged property and the chargor, filed an originating summons seeking a declaration that he was the owner of Unit L7-03-E1 Block 7 and not Unit No. 7B-03-01and that the sale was a nullity.
 Hishamudin Mohd Yunus J (as he then was), in dismissing the originating summons, held that a declaration was not the right remedy. His lordship held that if the plaintiff (the chargor) was aggrieved with the error in the proclamation of sale and the newspaper advertisement, he should have prayed for an order to set aside the sale conducted by the Deputy Registrar on the ground that
it was null and void. Or, alternatively the plaintiff should have appealed to the Judge in chambers pursuant to Order 56 of the RHC against the decision of the Deputy Registrar in proceeding with the auction in spite of the objection by the plaintiff.
 It is clear from the facts that Hanafiah Muhammad involves an application by a chargor to set aside a judicial sale. The decision of the Court there on the proper procedure to be adopted by a chargor who wishes to impugn a judicial sale has no relevance to this case.
 For the reasons stated above, we dismissed the Appellant’s appeal and allowed the Respondent’s cross-appeal. We set aside the order of the High Court Judge. We award agreed costs of RM10,000.00 to the Respondent. Deposit to account for costs.
signed (LIM YEE LAN)
Court of Appeal Malaysia, Putrajaya.
Dated this: 23 June 2014
For the Appellant:
For the Respondent:
Ms. Lucia Minta,
Messrs Darshan Singh & Co. No.82, (Tingkat 1)
Lebuh Bishop 10200 Pulau Pinang.
Mr. Jack Yow,
Messrs Rahmat Lim & Partners
Suite 33.01, Level 33
The Gardens North Tower
Mid Valley City, Lingkaran Syed Putera
59200 Kuala Lumpur.