Che Som and Che Kiah inherited a piece of land from their father measuring 25 hectares in Kluang Johor. They agreed that they would have equal shares on the land. The category of land use endorsed is for "agricultural purpose only". Che Kiah has made an application to subdivide the land equally under 3 separate titles. The land was surveyed and the final titles were issued in the name of Che Kiah and Che Som as the joint proprietors, namely Lot 100, Lot 101 and Lot 102. Jati Bestari Development Sdn Bhd (The Company) has proposed to Che Som to jointly develop Lot 100 into a housing estate. Che Som has accepted the proposal and upon signing the Joint Venture Agreement, the Company immediately proceeded with the ground work on Lot 100. Che Kiah on the other has entered into a Lease Agreement with Pak Abu for 30 years to rear livestock on Lot 102.Che Kiah has prepared Form 15A and signed it alone. Che Kiah submitted the Form 15A to the Land Office for registration without Che Som's knowledge.Che Som has informed Che Kiah that she wants a separate title to Lot 101.Based on the above facts, answer the following: a) Che Som received a notice in Form 7E from the State Authority in respect of Lot 100 and she wants to know why she is being served with that notice. (10 marks) b) The Land Office rejected the Form 15A submitted by Che Kiah. Explain why it was rejected and what is the position of Pak Abu if the lease is not registered. (10 marks) c) Can Che Som get a separate title for Lot 101? (10 marks)
a) Che Som received a notice in Form 7E from the State Authority in respect of Lot 100 and she wants to know why she is being served with that notice.
The reason why Che Som had been served with a notice in Form 7E is simply because she had breach the condition of the land which has been classified as an agricultural land. It is pertinent to note that, the State Authority may alienate land subject to express conditions which is further spelt out under Section 120 of the National Land Code. Express condition means the conditions that are endorsed on the title and relate to the use of land. For instance, in respect of land held under the category of agriculture is ‘This land may only be used to plant rubber trees’. If the proprietor breaches any express con dition on the title, the State Authority may bring forfeiture proceedings in respect of t he land. Whereas implied conditions are the conditions which are specified in the National Land Code in relation to the type of category of land use that the land is subjected to. However, these conditions have not been endorsed on the title. According to section 125(2), if there is a condition require proprietor to do something but he did not fulfil the requirement within the stipulated time or vice versa, it is considered a breach of condition. Upon any breach arising from such conditions in accordance with Section 127 (1) (a) and (b), any alienated land will face forfeiture by the State Authority, except in case of fines. According to Section 105(2), every condition continued interest and any restrictions should be in force until the return of the land and every condition subject to a period in accordance with the will. Alienation of State land under this Act shall be subject to any conditions or restrictions imposed by the State Authority. The piece of land owned by Che Som is in the category of “agriculture” which provided that no part of this land could be used for building or industrial purposes. By referring to the case of Collector of Land Revenue, Johor v South Malaysia
Industries Bhd., respondent were given a lease for 60 years for light industrial land category. Respondents wanted to meet space land acquired by building a store to store the chemicals and fertilizer factory next door. Respondent flouted the rules for building a store for the material that is not light industry. In allowing the appeal, Raja Azlan Shah J. held: We must construe the special condition endorsed on the document of the title as they stand and as a whole to see what is the intention of t he parties…The State Authority has and did
exercise its power to impose restrictions as to user of the factory premises erected on the land in question, i.e. for the purpose of a light industry… According to the issue of the use of the premises for storing industrial chemicals and fertilizers, the court held that: To use part of the factory premises for an alien and totally unconnected industrial project is inconsistent with the express conditions in the said lease. Through this case demonstrates breach of any conditions can cause the land can be in forfeiture by the State Authority. After any breach conditions applicable to any alienated land, then the land shall be insured to forfeiture to the State Authority. Land administrators can take action where it appears that the breach could be remedied by the proprietor in a reasonable period by submitting Form 7A. If the action is felt to be inappropriate or owner fails to comply with any notice of the Land Administrator shall serve a notice in Form 7B. After the command in Section 129 where an order declaring the land was forfeited to the State Authority for breach any condition, the Land Administrator shall publish in the Gazette a notice of forfeiture in Form 8A and commencement. If Che Som still wants to continue with the development of the housing estate, the application must be made to the State Authority. Pursuant to Section 124 (1) of the owner of alienated land may apply to the State Authority under this section. According Section 124(1)(c), the proprietor of any alienated land may apply to the State Authority under this section for the amendment of any express condition or restriction in interest endorsed on, or referred to in, the document of title thereto, or the imposition of any new express condition or restriction in interest. The State Authority may approve any application of proprietor either in the terms in which it was submitted or, with the consent of the applicant and any other persons or bodies whose consent thereto was required under the proviso to that sub-section, subject to such modifications as it may think fit, and shall, in either case, direct as appropriate (Section 124(4)). The amendment of any condition or restriction in interest endorsed on the document of title to the land (Section 124(4)(a)). The State Authority may approve the application in accordance with the terms in which it is presented or with the consent of the applicant and any other person whose consent is required under the proviso to paragraph (c) of subsection (1), subject to suitability to modify, and shall be either one of the cases, which directs as
appropriate according to the amendment of any conditions or restrictions of the endorsed on the document title to the land. Upon approval by the State Authority under this section, the Land Administrator shall sign a memorandum in Form 7C in 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 documents of title to the land and shall note the date thereof and the authority therefor, and authenticate the same under his hand and seal (Section 124(7)). After being approved by the State Authority, the Land Administrator shall sign a memorandum in Form 7c accordance with the instructions of the State Authority and shall submit the memorandum. The Registrar will make an income on the register and issue documents of title to land and will record the date and authority for him, and confirm memorandum to handle it. Premium will be charged on the change conditions or restrictions or categories by: The rent and premium in any direction issued by the State Authority under this section shall become due to the State Authority at the time when it approves the application and the Land Administrator shall cause to be served on the proprietor a notice in Form 7G requiring him to pay such sum within the specified time and if any such sum is not paid within such time the approval of the State Authority shall thereupon lapse (Section 124(8)) Rent and premium in any direction State Authority at the time it approves the application and the Land Administrator shall cause to be served on the proprietor of a notice in Form 7G, and if any amount is not paid within this period, the approval of the State Authority will expire thereafter.
b) The Land Office rejected the Form 15A submitted by Che Kiah. Explain why it was rejected and what is the position of Pak Abu if the lease is not registered. (10 marks)
Under section 221 of the National Land Code, the proprietor of any alienated land may grant leases of the whole or any part of the land that the proprietor wish to. In norder for the lease to be materialised, it should follow the procedure by virtue of subsection (4) where every such lease shall be granted by an instrument in Form 15A; and in any case where the lease relates to a part only of any alienated land, there shall be attached to the instrument a plan and description sufficient to enable the part to be accurately identified. Thus, there is no issue here because Cik Kiah had performed accordingly on the procedure to lease the land. In fact she also complied with the subsection 3 whereby the period of lease had been clearly stated as for 30 years. However, under section 342(1) of the National Land Code 1965 states that "coproprietorship" means that holding of alienated land by two or more persons or bodies in undivided shares. This means that each registered proprietor owns his fractional share over every part of the property in question. The shares of the co-proprietors are deemed to be equal unless different proportions are specified in the memorial of registration. For instance, if owner A wants to charge his portion which is 5 acres to the bank for a sum of money, he cannot do so without the consent of owner B. Once the land is charge, both owner A and B has to serve interest. To have co-proprietorship is to somehow prevent the other owner(s) from selling, charging or JV without the others consent and have all the interest by himself. In this case, this particular land had been subdivided and the proprietorship is owned by both Cik Kiah and Cik Som. Therefore Cik Som’s consent must be obtained when registration of dealing is being carried out. By virtue of section 92 (2)(c), Cik Som also has the right over the alienated land to effect the transfers, leases, chargers, surrenders and any other dealings permitted. Thus in our Torrens system, registration is everything in matters dealing to the land as held out in the case of Teh B ee v Maruthamuthu. Therefore as the registration is not carried out, no instrument of dealing shall operate to affect any interest to Pak Abu unless it is registered. Under section 206 (1)(b), if the lease is not registered, the legal interest in the land will not rest with the lessee, and the lease will rendered void.
However, Pak Abu need not to worry because there is an exception under section 206 (3) whereby the requirement in section 206 (1)(b) shall not affect any contractual operation of any transaction of alienated land. When the lease is not registered it just dealt with the operation of land matters in this country. The effect to that it does not have the effect of vesting the interest of lessee under section 227 (1). On the other hand, it is still a valid and enforceable as an agreement for a lease through Common Law and Equity. Under the Common Law system, a lease need not be registered as a legal interest is created upon signing of the agreement. In the case of Marg aret Chua v
Ho Swee K iew & Ors , the court held that there was a clear existence of a binding written contract which the proprietor was clearly in breach of, hence entitling the lessee to a remedy. Although the lease was not registered, the agreement is valid as an agreement for a lease and can be enforced in equity by decree of specific performance. In the case of Wan S alimah Wan J aafar v Mahmood Omar , the lease agreement was as good as an agreement enforceable in equity. Since the parties intended for there to be a lease, equity must be invoked to carry out that intention effectively. In conclusion, the lease agreement between Pak Abu and Che Kiah even though rejected by the Land Administrator, it’s still enforceable as a contract under the law of equity. However, Pak Abu should be aware that if there is any dealing upon the land, he will not be protected by the interest of a lessee under the National Land Code.
c) Can Che Som get a separate title for Lot 101?
Under the National Land Code, it prohibits the transfer of a part of any alienated land or part of undivided share therein. The rationale to that is only one title to be issued in respect of the whole land whether held by single proprietor or otherwise, a transfer of part of the land or part of undivided share cannot be effected unless and until separate title has been issued in respect of the part of the land or the portion of land representing the undivided share, which is sought to be transferred. The prohibition in section 214 (a) and (b) of the National Land Code intended to apply to a transfer of an undivided part or portion of land where no prior subdivision of the land has yet been approved. In this case, Che Som wishes to get a separate title for the whole subdivided Lot 101 where she and Che Kiah has the co-proprietary right over that piece of land. According to section 214 (b), she is eligible to do so because she wishes to transfer the whole lot of the undivided Lot 101. However, both proprietor and co-proprietor shall jointly submitted an application in Form 14 D to transfer, convey or dispose of the land to the Secretary of the Board by virtue of section 214 (4). In other word, Che Som must firstly obtain the consent from Che Kiah to transfer all of her interest to Che Som. She can just let go off all her interest by no means of getting nickel out of it or she can sell over the interest of her co-proprietorship to Che Som. Such dealing must be mutually consented between them outside the formal application to the Land Administrator.
