Uptown Properties Sdn Bhd v.

[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 271

A UPTOWN PROPERTIES SDN BHD

v.

PENTADBIR TANAH WILAYAH PERSEKUTUAN & ORS

B HIGH COURT MALAYA, KUALA LUMPUR
PRASAD SANDOSHAM ABRAHAM J
[SUIT NO: S-21-69-2006]
23 FEBRUARY 2012

C LAND LAW: Officers - Issuance of computerised title by Land

Administrator - Whether done in accordance with the law - National
Land Code s. 5A, 14th Schedule

LAND LAW: Officers - Computerised title mistakenly issued - Whether

act negligent or done in good faith - Whether statutory protection may be
D
claimed - National Land Code, s. 22

LAND LAW: Indefeasibility of title and interests - Computerised title

mistakenly issued - Whether title obtained though insufficient instrument -
National Land Code, s. 340(2(c)
E
LAND LAW: Indefeasibility of title and interests - Title mistakenly
obtained through Land Administrator - Insufficient and void instrument -
Whether act of Land Administrator ultra vires - Whether necessary to
prove bona fide purchaser for value - National Land Code, ss. 5A,
F 340(2)(c) - Federal Constitution, art. 13

In this land dispute, the land in question was registered in the

name of the plaintiff since 1982. In 2005, it was discovered that
the land was registered in the name of the 5th defendant,
Triscenic Sdn Bhd. It transpired that the first defendant had
G
issued a computerised title, by virtue of s. 5A of the National
Land Code (NLC), in the name of the 4th defendant, Liptown
Properties Sdn Bhd, who then transferred it to the 5th defendant
who in turn charged it to the 6th defendant, Malaysian Assurance
Berhad. It was also discovered that the 4th defendant was a non-
H
entity and not a company duly registered with the Suruhanjaya
Syarikat Malaysia (SSM). The 1st defendant is the Pentadbir
Tanah, Wilayah Persekutuan whilst the 2nd and 3rd defendants
are the Jawatakuasa Eksekutif Tanah Wilayah Persekutuan and
Kerajaan Malaysia respectively. The 1st defendant admitted the
I
error in the transfer but claimed that the issuance of the
computerised title was a genuine mistake. They further claimed
protection under s. 22 of the NLC which protects officers from
civil suits for acts done in good faith. The plaintiff however claimed
272 Current Law Journal [2012] 3 CLJ

that the transfer of the land to the 5th defendant was by means A
of an insufficient or void instrument and was therefore defeasible
in law.

Held (allowing the plaintiff’s claim):

B
(1) The 1st defendant owed a duty of care to the 5th and 6th
defendants to ensure that when searches are made at the
Land Registry, they would be acting on accurate information
and a properly maintained and accurate Register of titles.
(para 28)
C
(2) In order for the computerised title to be issued pursuant to
s. 5A of the NLC, a notice must be sent by the plaintiff to
surrender the old title in exchange for the new computerised
one. On the facts, there was no evidence to suggest that
such notice had been sent. This was in contravention of the D
14th schedule to the NLC. (paras 8 & 10)

(3) The issuing of a computerised title to the 4th defendant as a

registered proprietor when the original title to the said land
continued to be in the possession of the plaintiff was ultra E
vires as it contravened the provisions of the s. 5A of the NLC
and 14th Schedule and also s. 340(2)(c) of the NLC. It
follows therefore that any instrument executed by the director
of the 4th defendant would be void and insufficient per se.
(para 17) F

(4) As a result of the ultra vires action of the 1st defendant, there
is no necessity to deal with the question of whether the 5th
and 6th defendants were bona fide purchasers for value.
(paras 21 & 32)
G
(5) The conduct of the officers involved showed a failure to carry
out their functions correctly and can hardly be construed to
have carried out their duties in good faith. They were
therefore disqualified from the protection of s. 22 of the
National Land Code. (para 28) H

(6) Administrative shortcomings amounting to negligence and

breach of duty cannot justify the plaintiff being dispossessed
of its interest in the said land and the fact that it had
happened was a violation of the plaintiff’s constitutional right I
under art. 13 of the Federal Constitution. (para 30)
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 273

A Case(s) referred to:

Adorna Properties Sdn Bhd v. Boonsom Boonyanit [2001] 2 CLJ 133 FC
(not foll)
M&J Frozen Food Sdn Bhd & Anor v. Siland Sdn Bhd & Anor [1994]
2 BLJ 156 SC (refd)
Pendaftar dan Pemeriksa Kereta-Kereta Motor, Melaka & Ors v. KS South
B
Motor Sdn Bhd [2000] 2 CLJ 573 CA (refd)
Pow Hing & Anor v. Registrar of Titles, Malacca [1980] 1 LNS 120 FC
(foll)
Tan Tock Kwee & Anor v. Tey Siew Cha & Anor [1995] 4 CLJ 658 HC
(refd)
C Tan Ying Hong v. Tan Sian San & Ors [2010] 2 CLJ 269 FC (foll)
Teh Bee v. K Maruthamuthu [1977] 1 LNS 134 FC (refd)
Toh Huat Khay v. Lim A Chang [2010] 7 CLJ 261 FC (refd)
United Malayan Banking Corporation Bhd v. Syarikat Perumahan Luas Sdn
Bhd (No 2) [1988] 3 MLJ 352 (refd)
D Legislation referred to:
Federal Constitution, art. 13
National Land Code 1965, ss 5A, 22, 340, 14th Sch

For the plaintiff - Robert Lazar (TT Toi with him); M/s Shearn Delamore &
Co
E
For the 4th defendant - not represented
For the 5th defendant - CF Kuan; M/s RM Abdullah Kuan & Assocs
For the 6th defendant - Felix Raj; M/s Shaikh David Raj
For the 1st - 3rd defendants - Aida Adhha (Rohaizah & Haryati with her);
AG’s Chambers
F
[Editor’s note: Flease see Poh Yang Hong v. Ng Lai Yin & Ors [2010] 8 CLJ
323; [2010] CLJ JT(3) where relevant issues were also addressed by Lee
Swee Seng JC.]

Reported by EM Goh
G

JUDGMENT
Prasad Sandosham Abraham J:
H
[1] This case involves problems arising out of the
computerization of titles and the nightmare that can arise if things
go awry. The matter was disposed of after a full trial and I
reserved judgment till 31 January 2012 wherein I found for the
I plaintiff and made the orders that I did.
274 Current Law Journal [2012] 3 CLJ

[2] Let me turn first to the facts of this case. The primary facts A
of this case remain in the main undisputed. The land in question
was registered in the name of the plaintiff and held under Lot
1599 located at the 3rd Mile, New Petaling Road (Old Klang
Road). The issue document of title (exh. P1) is found at p. 1 of
bundle B. The plaintiff had been the Registered Proprietor of Lot B
1599 referred to aforesaid since 21 May 1982 which was vacant
land and had never been encumbered at least whilst the plaintiff
remained the Registered Proprietor of Lot 1599 (the said land).
The issue document of title to the said land namely GM 1270 has
been in the possession of the plaintiff and that continues to be C
the position. In the meanwhile the plaintiff continued to pay the
quit rent and receipts were issued to the plaintiff particularly
during the period 2001 to 2004. (See bundle B pp. 7, 8, 9, 18 &
19).
D
[3] The plaintiff continued to be totally unaware of what was
transpiring in respect of the said land with the issuing of quit rent
receipts in the name of the plaintiff, there was nothing to put the
plaintiff on guard that something was amiss.
E
[4] Sometime in May 2005, when the plaintiff’s employee went
to the land office to pay the quit rent for that year, the plaintiff
was shocked to discover, not only that the quit rent had been
paid, but that the said land was registered in the name of the 5th
defendant. After making a search and lodging a Police Report, the
F
plaintiff instructed its solicitors to bring a discovery action against
the 1st defendant and the following was discovered ie,:

(a) The name of the registered proprietor of the said land had
initially been altered on the register to that of the 4th
defendant; G

(b) The title number was Lot 1599 (the said Land) was GM
2968 & not GM1270;

(c) There was a transfer of the said land from the 4th defendant
H
to the 5th defendant sometime in December 2004;

(d) The register document of title maintained by the 1st defendant

still reflects the plaintiff as the registered proprietor of the said
land.
I
(e) The 1st defendant issued a computer printed document of title
in Form DK in respect of the said Land purporting to convert
the existing document of title GM 1270 to a computer printed
document of title.
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 275

A (f) The 1st defendant issued GM2968 in the name of the 4th
defendant on 25 June 2004.

[5] The said land was transferred by the 4th defendant to the
5th defendant who had charged the same to the 6th defendant
B to finance the purported purchase of the said land.

[6] The plaintiff now finds itself in a position whilst it holds the
original issue document of title to the said land by virtue of the
duplicate title and the computerized title issued by the 1st
defendant, the said land was now registered in the name of the
C
5th defendant and charged to the 6th defendant.

[7] To my mind the pivot of the plaintiff’s case is whether when

D the duplicate title was purportedly issued to the 4th defendant
was void pursuant to s. 340(2)(c) of the National Land Code and
the transfer of the said land to the 5th defendant was by means
of an insufficient or void instrument 340(2)(b). For this purpose I
set out the relevant section:
E
340. Registration to confer indefeasible title or interest, except in
certain circumstances.

(2) The title or interest of any such person or body shall not
be indefeasible:
F
(b) where registration was obtained by forgery, or by
means of an insufficient or void instrument; or

(c) where the title or interest was unlawfully acquired by

the person or body in the purported exercise of any
G power or authority conferred by any written law.

[8] To better appreciate the argument of the plaintiff on this

point, the court will have to examine the events that took place
during the computerization exercise carried out by the 1st
defendant in respect of the issue of document of title to the said
H
land. The 1st defendant introduced a computerized Land
Registration System for land titles. Section 5A of the National
Land Code was the enabling provision which was brought into
force on 1 January 1993. It was introduced by the National Land
Code (Amendment Act 1992 [Act 832 of 1992]. Section 5A
I
regulated the computerization of the old manual title deeds. The
aforesaid s. 5A was to be read together with the 14th Schedule
to the National Land Code particular s. 8 of the said schedule
which I have reproduced.
276 Current Law Journal [2012] 3 CLJ

5A. Coming into force of the Computerized Land Registration A

System in any Land Registry.

(1) The Minister may, with the approval of the National

Land Council, by notification in the Gazette of the
Federation, appoint a date for the coming into force of
the Computerized Land Registration System in any land B
Registry.

(2) For the purposes of subsection (1), the term “Land

Registry” means:

(a) in the case of land held or to be held under Registry C

title, or under the form of qualified title corresponding
to Registry title, the office of the Registrar of Titles;

(b) in the case of land held or to be held under Land

Office title, or under the form of qualified title
D
corresponding to Land Office title, the office of the
Land Administrator.

(3) Upon the coming into force of the Computerized Land

Registration System in any Land Registry:
E
(a) the provisions of the Fourteenth Schedule shall apply;
and

(b) the provisions of this Act insofar as they relate to the

forms of documents of title, the procedure for the
preparation and registration of any document of title, F
any dealing in land and any entry or endorsement of
any note, memorial or memorandum or any correction
or cancellation thereof on any document of title shall
be read with the modifications, amendments, additions,
deletions, substitutions or adaptations as provided in
the Fourteenth Schedule. G

(4) Except as provided in paragraph (b) of subsection (3),

all other provisions of this Act shall remain in force and
continue to apply to every document of title, instrument
or other document prepared under the Computerized
H
Land Registration System.

[9] It is clear that the aforesaid provision at least from the

evidence adduced was not complied with. DW2 Puan Rogayah
binti Kadari was put in charge of the pilot project for the
computerization of titles. From her evidence it becomes clear how I
the whole situation arose.
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 277

A On 28th November 1977 Puan Rogayah binti Kadari and her staff
attended as part of a pilot project she says, to the keying in of
details of various titles within the Kuala Lumpur Land Office
which at the time were in manual form. See chronology of events
at Bundle B page 223. In that process the name of the registered
proprietor for Lot 1599 was keyed in as “Liptown Properties Sdn
B
Bhd” rather than as “Uptown Properties Sdn Bhd” as it should
have.

[10] The 1st defendant has admitted there was an error in the
inclusion of the name of the 4th defendant on the computerized
C issue document of title for the said Land and the position of the
1st defendant was the issue document of title held by the plaintiff
was still valid. There never was any evidence to suggest that a
notice had been sent to the plaintiff to surrender the old title in
exchange for the new computerized title. The computerized title
D was to be a title in continuation. I find that the computerized title
being issued in the name of the 4th defendant was in
contravention of the 14 Schedule of the National Land Code. To
compound it further the 4th defendant itself is a non-entity ie, it
is not a duly registered company with the Suruhanjaya Syarikat
E Malaysia (SSM). (See the evidence of DW4 Mardiana bt Mohd
Zain)
Q: Boleh Puan terangkan mengapa terdapat Borang 9 atas nama
Syarikat Licin Sdn Bhd tersebut?
F A: Saya telah menyemak di dalam sistem dan rekod SSM,
rekod asal dan saya mendapati bagi nombor Syarikat 32315-
A terdapat dua Borang 9 iaitu satu atas nama Syarikat Licin
Sdn Bhd dan satu lagi di atas nama Liptown Properties Sdn
Bhd. Untuk pengetahuan Yang Arif dan pihak tuan puan,
mengikut prosedur di SSM, setiap penubuhan sesebuah
G
syarikat Borang 9 hanya dikeluarkan sekali sahaja. Tetapi
apabila saya memeriksa sistem dan dokumen asal yang ada
di dalam rekod SSM saya mendapati terdapat dua Borang 9
yang dikeluarkan atas nombor syarikat yang sama tetapi
nama syarikat yang tertera adalah berbeza. Saya telah
H mengesahkan berlaku tipuan di dalam penubuhan syarikat di
mana Syarikat Licin Sdn Bhd adalah merupakan syarikat asal
yang menggunakan nombor pendaftaran syarikat 32315-A.
Dan Syarikat Liptown Properties Sdn Bhd telah
menggunakan nombor Syarikat Licin Sdn Bhd.
I Q: Sekiranya Puan dirujukkan kembali ke Bundle D muka surat
1 dan muka surat 27 tersebut, boleh Puan terangkan kedua-
dua Borang 9 yang ada berdasarkan pernyataan jawapan Puan
sebentar tadi? Muka surat 1 Borang 9 yang atas nama
Liptown dan juga muka surat 27 Borang 9 yang tertera nama
278 Current Law Journal [2012] 3 CLJ

Syarikat Licin Sdn Bhd, berdasarkan jawapan Puan sebentar A

tadi. Boleh Puan terangkan kepada Mahkamah tentang kedua-
dua Borang 9 tersebut?
A: Mengikut muka surat 1 Borang 9 iaitu nombor syarikat
32315-A adalah untuk Syarikat Liptown Properties Sdn Bhd
tetapi merujuk kepada muka surat 27, Borang 9 nombor B
syarikat yang sama iaitu 32315-A adalah untuk perakuan
perbadanan syarikat sendirian bagi Syarikat Licin Sdn Bhd.
Q: Saya rujuk Puan kepada Borang 9 yang kita rujuk sebentar
tadi. Boleh Puan jelaskan kenyataan Puan sebentar tadi?
C
A: Saya mengesahkan Borang 9 bagi Syarikat 32315-A adalah
untuk Syarikat Licin Sdn Bhd dan bukan Liptown Properties
Sdn Bhd ini kerana berdasarkan Borang 9 pada particular di
dalam Borang 9 adalah sama bagi Syarikat Licin Sdn Bhd
tetapi berbeza bagi Liptown Properties Sdn Bhd.
D
[11] In the evidence of DW2 Rogayah binti Kadari:
Q: Tetapi Puan Rogayah terlibat dalam kes ini pada tahun 1997.
Itu sahaja yang mengatakan penglibatan Puan Rogayah di
mana proses tukar ganti daripada manual kepada hak milik
komputer. E
A: Ya
Q: Puan Rogayah telah pun memberitahu bahawa penukaran
nama daripada Uptown kepada Liptown telah berlaku secara
kesilapan itu adalah keterangan Puan Rogayah dalam witness
statement ini bukan. F

A: Ya
Q: Selepas kejadian ini berlaku bila Puan Rogayah tengok macam
mana pertukaran ini berlaku Puan Rogayah ...
A: Sebab huruf “U” instead of dia bulat, dia nampak bentuk G
macam empat segi. Tengok macam “LI”
Q: Tengok macam “LI”
A: Ya.
Q: Itu adalah keterangan Puan Rogayah? H

A: Biar saya beri penerangan. Biasanya kami Pendaftar pada

masa dahulu memang very teliti buat conversion, kita akan
semak satu persatu. Masa tu tak ada urusniaga on that title
hanya satu sahaja dan kerana yang buat tu adalah salah
seorang Kerani yang bagus dan berpengalaman. Jadi bila saya I
tengok dia tulis “Liptown”, jadi saya tengok dia verifikasi
yang borang hak milik versi kosong adalah “Liptown”, sekali
imbas sahaja “L”, jadi saya terus endorse. Tiada niat untuk
ubah. Masa itu saya tengok memang “L”.
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 279

A Q: Puan Rogayah bersetuju tak di bawah Jadual 14 DHKK itu

hanya boleh diberi kepada pemilik asal apabila pemilik asal
surrender manual title yang lama?
A: Ya.
Q: Tetapi dalam kes ini Puan rogayah berkata di jawapan
B
kepada soalan 14 Puan Rogayah ditanya ini;
Adakah dokumen hak milik asal dikembalikan? Iaitu hak
milik manual IDT manual. Soalan 14.
A: Sepanjang tempoh penukaran hakmilik ... ya betul.
C
Q: Jadi jawapan Puan Rogayah kepada soalan itu adakah
dokumen hakmilik asal bila disebut hakmilik asal iaitu
hakmilik IDT (issued document of title) manual di dalam
sistem yang lama seperti eksibit P1? Tengok pada eksibit P1
Puan Rogayah. Ini adalah hak milik asal
D
A: Ya
Question from the Court:
Q: Katalah the old owner, the owner was holding out to the old
title, masukkan title tu bawah katil, dia tak guna pada selepas
E computerization untuk five years, and all sudden he want to
do something income what is the position of the old title?
A: Valid.
Q: Yang dia pegang, the old title?
F A: Sepatutnya valid.
Counsel for 1st, 2nd and 3rd Defendants:
Q: Puan Rogayah Yang Arif ada bertanya tadi, sekiranya tuan
punya tanah mempunyai geran hak milik asal IDT asal pada
dia tersimpan lama tidak digunakan, bila dia nak melakukan
G
sesuatu ke atas tanah tersebut, geran tanah IDT yang asal
tu setelah dia tidak mengetahui tentang sistem komputer
yang dijalankan oleh Pejabat Tanah, apa yang terjadi pada
IDT yang ada pada dia yang tersimpan lama?
A: Valid.
H
Q: Still valid?
A: Still valid unless dia bayar duit cukai tanah every year. Dia
bayar cukai tanah, title dia validlah sebab tak ada ... patutnya
IDT ... validlah, dia tak ada buat urusan apa-apa. Masih dia
I own tanah dia, masih validlah.

[12] I find that the title or interest of the 4th defendant on being
registered as the registered owner of the said land was obtained
by means of an void instrument and was unlawfully obtained as it
280 Current Law Journal [2012] 3 CLJ

had been clearly established that there had been a mistake in the A
entering of the 4th defendant as the registered proprietor of the
said land. I find also that the 14th schedule of the National Land
Code had not been complied with. That being the case any
instrument of transfer and creation of a charge to the 6th
defendant would be consequently void or at the very least by way B
of a insufficient instrument in view of the fact that the 4th
defendant is not a company registered with the Suruhanjaya
Syarikat Malaysia (SSM) and does not exist as an entity. The
court have generally tended to read the phrase void or insufficient
instrument interchangeably but his Lordship Haidar bin Mohd C
Noor J in the case of Tan Tock Kwee & Anor v. Tey Siew Cha &
Anor [1995] 4 CLJ 658 at p. 659 para [6] held:
[6] The instruments by which the charges were registered are
merely voidable and not void and will remain so until they D
are declared void by a Court of law. The issue is the
meaning of the words “insufficient or void instrument” which
the Court opines should be read disjunctively, that is,
“insufficient instrument” would be confined to failure to
comply with the procedures or formalities laid down by the
NLC whereas “void instrument” would, inter alia, relate to E
any prohibition imposed by the NLC or any written law.

[13] In the decision of the Federal Court in Toh Huat Khay v.

Lim A Chang [2010] 7 CLJ 261; [2010] 4 MLJ 313 where it was
held: F
(1) The said land, due to the said restriction in interest endorsed
on the document of title pursuant to s. 124(1)(b) of the
NLC, could not be transferred by TKC to the Defendant
unless TKC as the proprietor had prior to the transfer,
applied to the state authority for the striking off or the G
rescission of the said restriction in interest. The Defendant
had not shown that such an application was made by TKC.
There was also no evidence to show that the state authority
had directed that the said restriction in interest be struck off
the document of title or that a note of its rescission be so
indorsed on the document of title pursuant to s. 124(3) of H
the NLC (see para 18).

(2) If at all the state authority had approved the transfer of the
said land, the land administrator, pursuant to s. 124(7) of
the NLC shall had to sign a memorandum in Form C in
I
accordance with the direction of the state authority and shall
present the same, and on the memorial thereof being made,
the registrar shall make an entry on the register and issue
document of title to the said land and shall note the date
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 281

A thereof and the authority therefore, and authenticate the same

under his hand and seal. These are mandatory statutory
requirements under the NLC which have to be adhered to
before the said land could be transferred. It could not be
assumed or implied that the state authority had complied
with s. 124 of the NLC in the instant appeal based merely
B
on the said letter from the director of land and mines
(see para 18).

(3) The transfer of the said land by TKC to the Defendant was
clearly in breach of the provisions of the NLC. The
C document of title had yet to be cleansed of the said
restriction in interest and without the title being freed of such
restriction in interest, the transfer of ownership was incapable
for registration. That being the position, the registration of
transfer of ownership to the Defendant was not indefeasible
since the registration thereof had been obtained by means of
D an insufficient or void instrument pursuant to s. 340(2)(b)
of the NLC (see para 29).

[14] I refer also to the case of United Malayan Banking Corporation

Bhd v. Syarikat Perumahan Luas Sdn Bhd (No. 2) a decision of His
E Lordship Edgar Joseph Jr J (as he then was) reported in [1988]
3 MLJ 352 and to his judgment at p. 356 Para B to G left hand
column and I quote:
In Wong Kim Swee v. Tham Hock Cham, a High Court decision a
restriction imposed on the title prohibited dealings with the land
F for ten years without the written approval of the Collector of Land
Revenue. An Agreement for a lease executed in breach of this
condition was held to be incapable of registration as being in
breach of the Code.

In these circumstances, the charge having been registered in

G
breach of an explicit statutory prohibition imposed on the title to
the charged land pursuant to the provisions of s. 120 of the
Code, the title or interest of the chargee is defeasible since
registration thereof had been obtained by means of an insufficient
or void instrument s. 340(2)(b) and also because the Registrar of
H Titles, in registering the charge, had acted ultra vires the powers
conferred upon him: s. 340(2)(c). The defence of estoppel
accordingly fails since there cannot be an estoppel to evade the
plain provisions of a statute: Fagabandhu v. Radha Krishna,
particularly when as here, the non compliance goes to the root of
the thing. In other words, of the terms of a statute are absolute
I
and do not admit of any relaxation or exemption, anything done
in contravention thereof, will be ultra vires and no person can be
stopped from putting forward the contention that what was done
was illegal or void: University of Delhi v. Ashok Kumar Chopra.
282 Current Law Journal [2012] 3 CLJ

Accordingly, no Court is at liberty to enforce as valid, that which A

a statute has declared shall not be valid or can compliance
therewith be dispensed with even by consent of the parties or by
failure to plead or argue the point at the outset: Surajmull v. Triton
Insurance Co Ltd.
B
[15] And finally I refer to the judgment of Ajaib Singh J at first
instance in the case of Teh Bee v. K Maruthamuthu [1977] 1 LNS
134; [1977] 2 MLJ 7 at p. 10 para. (b) to (d) left hand column
and I quote:
As a matter of public policy clear and obligatory provisions of the C
National Land code particularly those which provide for the very
basis of the powers of the state authority to approve the alienation
of state land ought to be given effect and should not be simply
sacrificed before the altar of indefeasibility of title. Giving a free
hand to those who deal with applications for the alienation of state
D
land, to allow them to disregard the clear and mandatory
provisions of the National Land Code and to let them exercise
powers which do not exist under the Code just because they may
wish to accommodate some particular applicant can result in many
adverse effects on the administration in the land registries leading
to corrupt practices and gross injustices. E

[16] The act of issuing a duplicate computerized title in the name

of the 4th defendant which cannot by any stretch of the
imagination be a continuation on title. That coupled with the
breach of the 14th Schedule to the National Land Code renders
F
the registration of the 4th defendant as proprietor void pursuant
to 340(2)(c) of the National Land Code and the instrument of
transfer to the 5th defendant was void as a consequence and / or
is a insufficient instrument as the 4th defendant had been
registered by the 1st defendant as the registered proprietor in
G
contravention of the 14th Schedule to the National Land Code
and at any rate the 4th defendant does not exist as a corporate
entity. I therefore find for the aforesaid reasons the transfer of the
said land to the 5th defendant is liable to be set aside as it is
defeasible.
H
[17] On the upshot the mistake of the 1st, 2nd and 3rd
defendants in describing the Registered Proprietor of the said land
as the 4th defendant was unlawful, the application for the issue
of a duplicate computerized title on the basis the original title was
lost and the subsequent issue of a duplicate title was null and I
void. The issuing of a computerized title to the 4th defendants as
a registered proprietor when the original title to the said land
continued to be in the possession of the plaintiff was ultra vires as
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 283

A it contravened the provisions of the National Land Code

(Amendment Act 1992 (Act 832 of 1992) s. 5A and the 14th
Schedule therein and the same was a contravention of
s. 340(2)(c) of the National Land Code. It follows therefore any
instrument executed by the director of the 4th defendant would
B be void and insufficient per se (see s. 340(2)(b) NLC).

[18] Before I proceed to deal with the specific defences raised by

the respective defendants I observe that the landscape of s. 340
of the National Land Code had been overshadowed by the
C decision of the Federal Court in Adorna Properties Sdn Bhd v.
Boonsom Boonyanit [2001] 2 CLJ 133. To put it simply, a forger
or an unscrupulous person obtains registration of title in his favor
that any subsequent transfer in favour of a third party so long as
he is a purchaser for valuable consideration remains indefeasible.
D It would follow in our case all the 5th defendant and the 6th
defendant would have to do is to plead that they are bona fide
purchasers for valuable consideration and that would be the end
of the matter. The consequences can be quite dire as in our
present case as the plaintiff can be in possession of the issue
E document of title, and yet find like in this case, there has been
“theft” of the said land but as far as the 5th defendant is
concerned, they pleaded the defence of bona fide purchaser for
valuable consideration and the position if upheld would be
indefeasible.
F
[19] Thankfully the Federal Court revisited the Adorna Properties
position in the case of Tan Ying Hong v. Tan Sian San & Ors
[2010] 2 CLJ 269. The facts of the case are as follows:
The appellant was the Registered Proprietor of a certain property
G in Kuantan, Pahang unknown to the appellant acting under a
forged Power of Attorney (PA) the 1st Respondent executed two
charges in favour of the bank to secure a loan for the 2nd
Respondent. The 2nd Respondent defaulted and the bank
demanded repayment. The appellant sought to declare the charges
null and void as the PA was forged. The High Court dismissed
H
the appellant’s case and held that the bank was protected by
Section 340(3) of the National Land Code. The appellant appeal
to the Court of Appeal was dismissed by the Court of Appeal.
The Federal Court in allowing the appeal held:

I Arifin Zakaria CJ (Malaya) (delivering leading the judgment of the

court):
(1) Section 340 NLC introduced into our land law the concept
of indefeasibility of title. Indefeasibility can be immediate or
deferred. Immediate indefeasibility means that the immediate
284 Current Law Journal [2012] 3 CLJ

registered title or interest of the proprietor or transferee, A

immediately to the vitiating circumstances, will be conferred
statutory protection despite the existence of any vitiating
circumstances. In deferred indefeasibility, the indefeasibility
only comes to be attached to the title or interest upon a
subsequent transfer. Therefore, the difference between
B
immediate and differed indefeasibility hinges on the effect of
registration vis a vis the title or interest (paras 19, 20 & 21)

(3) The question was whether the proviso following sub-s (3)
applied equally to sub-s. 2(b) of s. 340 NLC. A proviso to
a subsection would not apply to another subsection. A C
proviso carves out an exception to the provision immediately
preceding the proviso and to no other (See M/s Gajo Ram v.
State of Bihar; Ram Narain Sons Ltd Ass Commr of Sales - tax).
(para 49)

(4) Subsection (3) of s. 340 NLC merely provided that any title D
or interest which was defeasible by any of the circumstances
specified in sub-s. (2) shall continue to be liable to be set
aside in the hands of a subsequent holder of such title or
interest. That subsection was subject to the following proviso
which read “Provided that nothing in this subsection shall
E
affect any title or interest acquired by any purchaser in good
faith and for valuable consideration, or by any person or
body claiming through or under such a purchase.” The
proviso was directed towards the provision of sub-s (3),
supported by the use of the words “in this subsection”
found therein. The application of the proviso could not be F
projected into the sphere or ambit of any other provision of
s. 340. (paras 50 & 51).

(5) Although sub-s. (3) of s. 340 NLC made reference to sub-

s. (2), sub-s.(3) was restricted to subsequent transfers or
interests in the land, It did not apply to an immediate G
transferee of any title or interest in land. Adorna Properties
did not fall under the category of subsequent acquirers and
therefore could not take advantage of the proviso to sub-s
(3). (para 52)
H
(7) In the present case, the charge instruments were
indisputably forged instruments. It followed that the two
charges were liable to be set aside under s. 340(2)(b)NLC.
The third respondent was the immediate holder of those
charges. It could not take advantage of the proviso to
s. 340(3). The answer, therefore, to the question posed I
before the Court - “Whether an acquirer of a registered
charge or other interest or title under the National Land
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 285

A Code 1965 by means of a forged instrument acquires an

immediate indefeasible interest or title” - was answered in
the negative. (paras 55, 56 & 57).

I refer to the judgment of His Lordship Tun Zaki Azmi CJ (as he

then was) setting out the position in law with regards to s. 340
B
of the National Land Code at p. 279 and 280 in paras. 6, 7 & 8
of His judgment which I have set out:
[6] As far as s. 340(1) of the NLC is concerned, A’s title to
the land is totally indefeasible. In short if A’s name appears
C on the registration, no one can come and claim for that title.
The law will not entertain it at all.

[7] Now comes the next person, B, whose name appears in the
register. If it can be shown that the title or interests obtained
by B was obtained by fraud or misrepresentation by him or
D anyone else to which he was a party or privy then his claim
to the title or interest can be defeated. (See s. 340(2)(a) of
the NLC). Otherwise B stands in the same position as A.

[8] The situation where it is proved that the registration in B’s

name was obtained by forgery or by means of an insufficient
E
or void instrument is the same (See s. 340(2)(b) of the
NLC). His title or interest to the land is liable to be set
aside by the previous owner who has a good title. In this
latter instance, there is no need to show that B was a party
or privy to that forgery or to obtaining the title or interest
F by a void instrument.

[20] I also refer to the leading judgment of Ariffin Zakaria CJM

(as he then was) where he dealt with His usual Adroitness the
Development of the Law on s. 340 of the National Land Code,
the advent of Adorna Properties case and its impact on deferred
G
defeasibility and the present position of the law and the
reaffirmation of the doctrine of deferred defeasibility which has
been an integral part of our jurisprudence and I set out
paras. (19), (20) (21), (22), (23), (55) & (61) ie, the relevant
portions of His Lordship’s judgment and I quote:
H
[19] Section 340 of the NLC introduced into our land law the
concept of indefeasibility of title. This is central to the system
of registration of title under the Torrens system. Raja Azlan
Shah (as His Royal Highness then was) in PJTV Denson (M)
I Sdn Bhd v. Roxy (M) Sdn Bhd [1980] 1 LNS 55 observed
that the concept of indefeasibility of title is so deeply
embedded in our land law that it seems almost trite to restate
it. Indefeasibility is defined by the Privy Council in Fraze v.
Walker [1967] AC 569 at p. 580 to mean:
286 Current Law Journal [2012] 3 CLJ

The expression not used in the Court itself, is a A

convenient description of the immunity from attack by
adverse claim to the land or interest in respect of which
he is registered, which registered proprietor enjoys. This
conception is central in the system of registration. It does
not involve that the registered proprietor is protected
B
against any claim whatsoever; as will be seen later, there
are provisions by which the entry on which he relies
may be cancelled or corrected, or he may be exposed to
claims in personam. These are matters not to be
overlooked when a total description of his rights is
required. But as registered proprietor, and while he C
remains such, no adverse claim (except as specifically
admitted) may be brought against him.

[20] Indefeasibility can be immediate or deferred. The distinction

between the two is well explained in para 404 of the
National Land Code, A commentary (Vol. 2) by Judith D
Sihombing which reads:

There are two types of indefeasibility; immediate and

deferred. The factor which distinguishes the two is the
common law effect given to the instrument even after
E
registration; in addition; in a regime of deferred
indefeasibility, the role of registered volunteer might be
more relevant than under an immediate indefeasibility
system. If after registration has occurred, the system
then ignores the substance, form and probity of the
instrument used to support the registration, the system F
is likely that of immediate indefeasibility. Thus,
registration has cured and defect in the instrument being
registered. If the instrument, despite registration, still has
the power to affect the registered interest or estate, the
system will probably be that of deferred indefeasibility.
G
[21] In short, immediate indefeasibility means that the immediate
registered title or interest of the proprietor or transferee
immediately to the vitiating circumstances will be conferred
statutory protection despite the existence of any vitiating
circumstances. In the case of deferred indefeasibility, the H
indefeasibility only comes to be attached to the title or
interest upon a subsequent transfer. Thus, the difference
between immediate and deferred indefeasibility hinges on the
effect of registration vis a vis the title or interest.

[22] Before the decision of Adorna Properties the prevailing view I

was that s. 340 of NLC confers deferred indefeasibility as
opposed to immediate indefeasibility. This was confirmed by
the Federal Court in Mohammad bin Buyong v. Pemungut
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 287

A Hasil Tanah Gombak & Others [1981] 1 LNS 114. This

further reinforced by the Supreme Court’s decision in M &
J Frozen Food Sdn Bhd & Nor v. Siland Sdn Bhd & Anor
[1994] 2 CLJ 14. There the Supreme Court, comprising of
Abdul Hamid Omar LP, Edgar Joseph Jr and Wan Yahya
SCJJ held that indefeasibility can be rebutted not only by
B
fraud but also in cases, where registration is obtained by the
use of an insufficient or void instrument or where the title
or interest is unlawfully acquired.

[23] In that case, it was held that failure to comply with the
C statutory requirements of para (a) and (b) of s. 258 and
para (c) of s. 261(1) of the NLC was not just a mere
irregularity, but was an illegality which struck at the root of
the first respondent’s right to be heard. Therefore, the
certificate issued by the Senior Assistant Registrar was ultra
vires the statutory provisions of the NLC and the title was
D unlawfully acquired by the first appellant. The title of the
first appellant was defeasible under s. 340(2)(c) of the NLC
and the learned judge had arrived at a correct decision when
he made the order for the cancellation of the registration of
the transfer.
E
I also quote:
[55] Reverting to the facts of this case, it is not in dispute that
the two charges registered in favour of the 3rd respondent
were based on void instruments as the relevant Forms 16A
F were not executed by the appellant. They were executed by
the 1st respondent pursuant to a forged PA. Thus, the
charge instruments (Form 16A) used in the present case
were indisputably void instruments. It follows, therefore, that
the two charges in this case are liable to be set aside under
s. 340(2)(b) since they are based on void instruments.
G
I also quote:
[61] We must stress that, the fact that the 3rd respondent
acquired the interest in question in good faith for value is
not in issue, because once we are satisfied that the charges
H
arose from void instruments, it automatically follows that
they are liable to be set aside at the instance of the
registered proprietor namely, the appellant.

[21] On the facts of our present case the placing of the name of
I the 4th defendant on the duplicate title issued by the 1st
defendant was void as the plaintiff remains the registered
proprietor of the said land and also holds the issue document of
title, a mistake duly acknowledged by the 1st defendant. It follows
288 Current Law Journal [2012] 3 CLJ

in my judgment the issuance of the computerized title in the name A

of the 4th defendant was in breach of s. 340(2)(c) of the National
Land Code and was void. The 4th defendant title was also in
breach of s. 340(2)(c) because of a breach of s. 8, Schedule 14th
of the National Land Code and to compound matters further, the
4th defendant is not even registered with SSM. It’s a breach that B
strikes at the root of who the proprietor of the said land was.
However since the act of issuing the 4th defendant with a
duplicate title was unlawful and ultra vires, any instrument executed
by the 4th defendant in favour of the 5th and 6th defendants as
the vendor was a void and an insufficient instrument pursuant to C
s. 340(2)(b) of the National Land Code and was liable to be set
aside under the principle of deferred defeasibility.

[22] I refer to the Supreme Court decision of M&J Frozen Food

Sdn Bhd & Anor v. Siland Sdn Bhd & Anor [1994] 2 BLJ 156 at D
to the judgment of Wan Yahaya SCJ (as he then was) p. 165
which I now set out:
A purchaser of land might fail to obtain a good title in two distinct
ways. Firstly, if the title of the vendor is bad. Secondly, even if
the vendor has a good title, there might be some invalidating E
defects in the conveyance or transaction in which the purchaser
attempted to obtain the title. These transactions might be void or
voidable for a variety of reasons. In the case of a defect in the
vendor's title, the common law rule, is that no person can give a
better title than he had - nemo dat quod non habet. There are, F
however, important exceptions to this rule, in particular the
qualification made under the proviso to s. 340(3) of our National
Land Code 1965 where a bona fide purchaser for value without
notice of the defeasible nature of the vendor's title acquires an
immediate indefeasible title. In the case where the vendor's title is
good but the instrument which was used by a purchaser for G
registration is void or voidable, the effect on such registration will
only confer on the person in whose name the land is registered,
what is usually referred to as deferred indefeasibility, - see Gibbs
v. Messer [1891] AC 248. Under this principle, the registration
of the insufficient or void instrument can be set aside. H

It would appear, however, from the facts in this appeal that the
challenge on the indefeasibility of the purchaser’s interest could
appropriately be dealt with under paragraph (b) and (c) of
s. 340(2) of the NLC.
I
[23] I find the conduct of the officers involved shows a failure to
carry out their functions correctly and can hardly be construed to
have carried out their duties in good faith. I would echo that
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 289

A portion of the judgment of the Federal Court in Pow Hing & Anor
v. Registrar of Titles, Malacca [1980] 1 LNS 120; [1981] 1 MLJ
155 at pg 160 the judgment of Abdool Cader J at p. 160 and I
quote:

B In tune with the prelude with which we commenced at the outset,

we would by way of postlude in restating the message this
decision delivers enjoin every official concerned with or involved
in exercising powers and duties under the Code and related
legislation to regard this judgment as regrettably necessary but
solemn caveat, giving warning, loud and clear, against any wanton
C disregard or sloppy application of express statutory provisions in
the exercise of their functions, and one to be understood, marked
and digested as such. We would add that they must strive to be
au fait with the law they have to administer and should not
hesitate in the course of their statutory duties to seek legal advice
D
whenever necessary from the State Legal Adviser or his confreres
and should never put the latter in the invidious and perhaps even
an intolerable position they found themselves in these proceedings
of having both in the court below and before us to make feeble
attempts at ex post facto justification for the inexcusable defaults of
others on a post hoc ergo propter hoc premise, quite apart from
E unnecessarily constraining the justly aggrieved to pit themselves in
curial combat against the massive and bottomless purse of the
State - much to the delight, perhaps, of the legal profession.

[24] I now turn to the defence of the 1st to the 3rd defendants.
The defendants submission and pleadings indicate they had made
F
a mistake but maintain it was a genuine mistake. The thrust of
their arguments relate to the issuing of the computerized document
of title to the 4th defendant with a new GM No. 2968. The
rogues of the piece they claim are the 4th & 5th defendants and
G
as a fallback position reliance is placed on s. 22 of the National
Land Code:
22. Protection of officers

No officer appointed under this Part shall be liable to be sued in

H any civil court for any act or matter done, or ordered to be done
or omitted to be done, by him in good faith and in the intended
exercise of any power, or performance of any duty, conferred or
imposed on him by or under this Act.

[25] With respect, the issue to be addressed did the 1st

I defendant act ultra vires in issuing a computerized duplicate title to
the said land with a new GM No. 2968 to the 4th defendant and
if, the provisions of s. 8 of the 14th the Schedule of the National
290 Current Law Journal [2012] 3 CLJ

Land Code had been adhered to, this problem would not have A
arisen at all. The mistake that had led to this debacle was the
typing in of the 4th defendant in the computer particulars instead
of the plaintiff (see the evidence of DW3).

[26] The maintenance of a land registry that is efficient and B

maintains accurate particulars is a duty that the 1st defendant
owes to every member of the public who makes and relies on a
search made at the Land Registry maintained by the 1st
defendant. If this confidence is jeopardized that could have dire
consequences for trade and economic activity in this country. C

[27] By analogy I refer to the decision of the Court of Appeal in

Pendaftar dan Pemeriksa Kereta-Kereta Motor, Melaka & Ors v. KS
South Motor Sdn Bhd [2000] 2 CLJ 573, the issues in this case
involving the duty of the RIMV to keep a register of vehicles
D
which was proper and accurate. The Court of Appeal held in a
leading judgment of Siti Norma Yaakob JCA as she then was and
I quote:
[1] The appellants’ argument that there is no duty on them to
keep a true a proper register of vehicles registered by them E
is only tenable if such duty of care is owed to the public at
large. This is not the criteria here. The duty to take care
sought to be imposed here is owed to an aggrieved party
and not to the public at large.

2(b) It also indicates that the day-today-operations at the registries F

of the first and second appellants have not been conducted
properly or professionally. For that, the first and the second
appellants must be made accountable.

[3] The law should be that the registries maintained by the

G
appellants must contain accurate particulars of all vehicles
registered by them. This is essential for the good working
of the register system as owners of motor vehicles or
anybody else involved in the motor trade conduct searches
on the registers on payment of a fee, and clearly, a duty to
take care must exist in such a case. H

[4] It follows that, every particular information recorded in the

files of a registered vehicle is a representation that such
information is accurate and reliable as the paying public,
particularly owners of motor vehicles, would-be purchasers of
such vehicles and those involved in the motor trade like the I
respondent, rely on such information to conduct private and
 Uptown Properties Sdn Bhd v.
[2012] 3 CLJ Pentadbir Tanah Wilayah Persekutuan & Ors 291

A commercial transactions. It is this concept of general reliance

that imposes a duty on the first and second appellants to
take care that all information coming from them are accurate.

[5] It is incorrect for the appellants to maintain that the second

appellant was not aware of the purpose of the respondent’s
B visit to the registry, as the act of endorsing the registration
book is proof enough that a transfer transaction was afoot.
That aside, the second appellant ought to have been aware
that the act of transferring the car to the respondent’s name
may not be the last transaction conducted by the respondent
C on the car. The possibility of it being transferred by the
respondent to a third party by way of a resale is there and,
being a car trader, that possibility is real. The incidence of
negligence or negligent statement and misrepresentation, in
the circumstances, have been proved.

D [28] I would hold that the aforesaid principles apply to the 1st
defendant in our case and I would hold that the 1st defendant
owed a duty of care to the 5th & 6th defendants to ensure that
when searches are made at the land registry, they would be acting
on accurate information and a properly maintained and accurate
E register of titles. I also find from the evidence it shows that the
1st defendant had not acted in good faith and will be disqualified
from the protection of s. 22 of the National Land Code.

[29] The plaintiff had effectively been deprived of his right to the
F said land a right provided for under art. 13 of the Federal
Constitution, I set out art. 13:
13. Rights to property.

(1) No person shall be deprived of property save in accordance

G with law.

(2) No law shall provide for the compulsory acquisition or use

of property without adequate compensation.

[30] In my judgment, administrative short comings amounting to

H negligence and breach of duty cannot justify the plaintiff being
dispossessed of its interest in the said land and the fact that it
has happened is a violation of the plaintiff’s constitutional right
under art. 13 of the Federal Constitution.

I
[31] Perhaps in the current climate of the administration of the
country and the transformation policy and reforms being carried
out by the government, I would be prepared to say that the 1st
defendant owed a duty of care to ensure that by its own mistakes
292 Current Law Journal [2012] 3 CLJ

and negligence, the rights of the plaintiff enshrined in art. 13 of the A

Federal Constitution are not rendered nugatory. This court cannot
sit back and allow the plaintiff to be deprived of its land. If not
checked a landowner who takes comfort in the document of title
he holds, could have his rights be taken away from him “nilly
willy”. B

[32] In the light of my finding, I am of the view there was no

necessity to deal with the question of bona fide purchaser for value.

[33] On that basis I allowed the notice of contribution for the

C
5th & 6th defendants against the 1st, 2nd & 3rd defendants with
damages to be assessed by the Timbalan Pendaftar. It must be
shown that the breach of duty of the 1st, 2nd & 3rd defendants
owed to the 5th & 6th defendants was the foreseeable cause and
causally by itself caused the damages suffered particularly by the
D
6th defendant. The whole transaction would have to be examined
carefully and its short comings particularly the Suruhanjaya
Syarikat Malaysia (SSM) in registering a nonexistent company in
its registry and the role of the solicitors in this transaction.

[34] By this judgment it is hoped that the short comings and E

irregularities arising in this transaction can be rectified to ensure
there isn’t a repeat performance of what has happened, the
consequence of which would deprive a registered owner of land
to his property which for many would have been a struggle to
earn and pay for their land. It is hoped that the 1st, 2nd & 3rd F
defendants will undertake the necessary measures to strengthen
their respective registries after consultation with all relevant
stakeholders including SSM and the Bar Council and other
relevant bodies.
G
[35] For these reasons the court made the following orders:

(a) The court grants the orders prayed for in prayer (1) to (7),
(10) & (11) of the statement of claim against the 1st, 2nd &
3rd defendants only;
H
(b) The 5th defendant’s notice of contribution in encl. 53(b) and
6th defendant’s notice contribution in encl. 53(a) against the
1st, 2nd & 3rd defendants for damages is allowed and be
assessed and dealt with by the Timbalan Pendaftar of the
High Court. I

(c) Enclosure 53(c) is withdrawn with no orders as to costs.