Land Law- Chapter 1

1.1 Historical Background of Malaysia Land Law

1. Malaysia Land Law

 Based on Torrens System

 Introduced by British colonist
 Implement through National Land Code 1965

2. National Land Code are enforced at all country (except: Sabah & Sarawak)
3. Before British colonisation

 Malay states have their own System of Law

 Based on Islamic & Custom Law

4. The Straits Settlements (Penang & Malacca)

5. The Federated Malay States (Perak, Selangor, Negeri Sembilan, Pahang)
6. The Unfederated Malay States (Kedah, Johor, Perlis, Kelantan, Terengganu)

Straits Settlements: Penang

1. Ong Cheng Neo v. Yeap Cheah Neoh (1872) 1 Ky. 255,

Privy Council:

…the island was wholly uninhabited when the English arrived. It was really immaterial to
consider whether the island should be regarded as a ceded or newly settled territory for there
is no trace of any laws having been established there before it was acquired by the East India
Company.

2. English land law was introduced into Penang by the First Charter of Justice 1807.
3. Wholly subjected to English land law as there was no form of local tenure.
4. Malay customary land tenure of the Kedah should have been regarded as the lex loci of the
island.

Straits Settlements: Malacca

1. British acquired Malacca in 1824 by virtue of the Anglo-Dutch Treaty

2. At the time, Malacca has its own land tenure system, consisting of Islamic law and Malay
Custom.
3. Sahrip v. Mitchell & Anor
 It is well-known by the old Malay law or custom of Malacca, while the Sovereign was the
owner of the soil, every man had nevertheless the right to clear and occupy all forest and
waste land subject to the payment to the Sovereign of 1/10 of the produce of the land so taken.

4. Then the land law that prevailed was the Malay customary tenure with the system of Dutch
Grants implemented in the urban areas.

Characteristics of Malay Customary Land Tenure

1. Proprietary rights: Nature of ownership is not one of absolute ownership but is based on
‘proprietory rights’, where the right of ownership extends not to the soil but to the usufruct
or the right to utilise the soil.
2. Method of acquiring land: by opening up and cultivating virgin jungle land or waste land.
3. Rights of the Ruler:

-The Sultan had the discretion to grant the right of possession (not ownership) of the land to
his subjects. Such rights of possession included the right to succession and the right to deal in
the land either by way of sale, transfer, pledge, etc.

- To receive 1/10 of the proceeds of the land as tax. To forfeit the land if the land was neglected
or abandoned for any substantial period of time without any reasonable cause.

- The owner would lose all his rights therein.

Pulang Belanja (Return of expenses)

1. If the owner wishes to sell his land, the price which he could expect from the purchaser would
be the sum total of his labour and expenses incurred in cultivating and developing the land.

Jual Janji: (land is held as security for a loan)

1. The borrower transfers his land to the lender who thereby takes possession over the land ;
whatever profits the lender may make out of the land will be his as reward for the loan.
2. The borrower is entitled to resume the land upon settlement of debt , except that where a
period was fixed for repayment of the loan default, will turn the original arrangement into
absolute sale (jual putus).

Federated Malay States

1. Perak, Selangor, Negeri Sembilan, Pahang.

2. Independent states under sovereign Muslim rulers.
3. The Pahang Consolidated Company Ltd v The State of Pahang (1933) MLJ 247
 -The Privy Could held that the Sultan of Pahang is an absolute ruler in whom resides all
legislative and executive power, subject only to the limitations, which the Sultan has from
time to time imposed upon himself in the circumstances

- In the FMS, there were no Charter of Justice and the British Common Law was not introduced
until the passing of the Civil Law Enactment No.3 of 1937.

-With the coming of the British administrators in the Federated Malay States, Malay
customary tenure soon gave way to the Torrens System.

-The first Torrens legislation in the Malay States was the Selangor Registration of Titles
Regulations of 1891.

Unfederated Malay States

1. Kedah, Johor, Perlis, Kelantan, Terengganu.

2. Came later in time.
3. Land tenure was also the Malay customary tenure influenced in some instances by Thai law
(particularly in Kedah & Perlis)
4. British gained possession of these states in 1909 pursuant to the Anglo-Siamese Treaty.
5. Late 19th and early 20th century, the Torrens System was introduced.

THE TORRENS SYSTEM

1. Introduced during the British colonial rule by WE Maxwell after he came back from Australia

2. The Torrens System was first introduced into the FMS. There was already a system of land
law based on Malay custom and Islamic law then.

3. Tengku Jaafar & Anor v. The State of Pahang (1987) 2MLJ 74:

“…the land law in Pahang before the introduction of the Torrens System was the Islamic law of
the Shafii school”.

FMS Enactments of 1911

1. All were repealed with the formation of a central legislature.

2. New uniformed law in 1911:

a) Federated Malay States Land Enactment 1911

 b) Registration of Titles Enactment 1911

3. Divided land into two categories:

a) The Land Enactment dealt with the registration of country lands less than 100 acres in
area on a Mukim land

b) The Registration of Titles Enactment dealt with registry lands (town lands and country
land exceeding 100 acres and estates)

4. Owners of land are given indefeasibility of title;

5. The traditional method of acquisition of virgin land or waste land was abolished – Sidek &
461 Ors v. Govt of Perak;
6. Forms of dealings were recognised;
7. Two forms of caveats were recognised;

 Continued in force until repealed by the Federated Malay States Land Code 1926 -
amended in 1928.

Incorporated the basic Torrens principles:

1. All lands vest in the Ruler, who has the power to alienate land to his subjects either in
perpetuity of for a fixed term of up to 999 years;
2. All dealings in land must be in the prescribed form and must be duly registered with the
relevant authorities. Land title should not be conveyed by an instrument in writing executed
by the landholder but by the registration of that instrument.
3. Failure to do so so would render the dealings null and void – case Hj Abdul Rahman & anor.
V. Mohamed Hassan.

1928 FMS Land Code

1. A consolidation and improvement of the pre-existing laws).

2. Changes introduced:

a. The principle of indefeasibility of title was more clearly defined,

b. Adverse possession against individual owners of land is no longer possible;

c. Customary tenure under Adat perpatih is preserved;

 d. The strictness regarding compliance with statutory form and registration as indicated in Hj
Abdul Rahman’s case.

e. Specific types of cultivation were enforced.

The Governing Laws

1. One uniformed Land Code for FMS

 The FMS has a uniformed land law with consistent land administration procedures.
2. Five separate State legislation in each of the UFMS

•Johor Land Enactment

•Perlis Land Enactment

•Kedah Land Enactment

•Kelantan Land Enactment

•Terengganu Land Enactment

3. The English Deeds system still prevailing in the Straits Settlements of Penang and
Malacca.

The Formation of NLC

1. The Reid Constitutional Commission in its report suggested that the 1928 FMS Land Code to
be the model used by the legal draftsmen to work on a new National Land Code in order to
achieve uniformity for all the nine Malay states and the two Strait Settlements.
2. The new 1965 National Land Code came into force on 1st January 1966.

The National Land Code

1. Enforced in all states except Sabah & Sarawak

2. Other legislation related to land law passed at the federal level; (1) Land Acquisition Act (2)
Strata Titles Act

3. Besides, other legislation enacted at the state level eg: the various Malay Reservation
Enactments

4. Various subsidiary legislation eg: State Land Rules

Application of the 1965 National Land Code

1. Enforced in all states except Sabah and Sarawak

2. Besides the NLC, other legislation relating to land law passed at the federal level include:
• Land Acquisition Act
• Strata Titles Act
3. There are also legislations enacted at the state level i.e. the various Malay Reservation
Enactments.
4. Various subsidiary legislation e.g. the various State Land Rules

State Authority

1. Land is vested in the State Authority

2. S 40 NLC:
There is and shall be vested solely in the State Authority the entire property in-

(a) all State land within the territories of the State;

(b) all minerals and rock material within or upon any land in the State the rights to which
have not been specifically disposed of by the State Authority.

3. Who is the State Authority?

4. S 5 NLC: Ruler/Governor of the State

Constitutional Issues

1. Land is a State matter, only the State legislature may make laws with respect to land.
2. Land comes under the State list -- Article 74 FC, Ninth Schedule
3. Exception: Power of the Parliament to make laws under the State list for the purpose of
uniformity – Article 76 (4)
4. E.g. the National Land Code
5. East Union (M) Sdn Bhd v Government of Johor (1981) 1 MLJ 151.

Features of the National Land Code 1965

• Register Document of Title (RDT) – The Register

 Retained at the Registry or Land Office

  Available to the public

• Issue Document of Title (IDT)

• Kept by the registered proprietor

• Evidence of his ownership

• Registry Title & Land Office Title

• Final title & qualified title

• Strata Title

1.2 Sources of land law

Federal constitution

1. Federal Constitution 1957, Article 74

2. Federal Constitution 1957, Article 76.
A.76 was established to promote uniformity, so that the whole Peninsular Malaysia shares
the same guidelines.
3. Federal Constitution 1957, Article 95(d)
4. Federal Constitution 1957, Ninth Schedule, List II, Item 2 (State List)
5. The 9th Schedule of Federal Constitution is a state list which determines the power of both
the Federal and State governments.

Customary law

1. The Malaysian land law had also been influenced by the Islamic and customary laws. Such
influence could be seen from the concept of harta sepencarian or 'jointly-acquired property'.
Under the concept, the right of a wife towards the property or land is recognised as long as it
had been acquired during the marriage even if the property was under the name of the
husband and the wife is a fulltime housewife since the contribution of the wife to the family
must be recognised. However, a declaration to such effect by the court is required and is
usually given upon the division of such property upon death or divorce.
2. Some customs of the local inhabitants such as Adat Perpatih, Adat Temenggung and custom
related to family law are given legal force by courts in this country. The principle of Adat
Pepateh is that only women can own property. The property must be transferred to women.
3. In Sabah and Sarawak, land dealing over native customary lands and family matters are
applied by native custom-matters.
4. Waqaf land- a land or property being delicated by god. When a Muslim decide that a land is
waqaf land, such land cannot be transfer anymore, which the land belongs to Allah.

Federal and State Enactments

1. Federal statute- Civil Law Act 1956- S.3 and S.6

2. State Enactments- Malay Reserves Enactment, which is passed by State Legislative
Assembly.
3. There are two main objectives of Malay Reserves Enactment:
a) Prevent State Land in Malay Reservation Area from being disposed by any means to the
non-Malay.
b) Prevent any private dealings between Malay and non-Malay in term of Malay Holding or
Malay Reservation Land

English common law

1. It can be part of Malaysian land law.

2. There are limitations, such as there is cut-off dates for Peninsular Sabah and Sarawak.

1.3 Differences between “registration of title” and “title by registration”

Registration of title Title by registration

Refer to deeds system originated by English It is known as the Torrens system originated
law from Australian law
Through registration of deeds By registering your land or title
Deeds already have a legal effect. In order for Presents the instrument to the registration
deeds to have legal effect, land owner must land office
register the land at Registrar.
The deed must be signed, sealed and S.304- registration
delivered.
 No 3rd party involved. It is only between the Title can be obtained by registration of land
seller and purchaser of land.
In order to find the seller/ owner as the real It can only claim title by Registration
owner of land, the interested land buyer must
trace back the chain of transaction. The chain
of transaction cannot be broken, or else the
title deed would be ineffective.
Register Document of Title (RDT)-kept by
owner & Issue Document of Title (IDT)-
Kept by the registered proprietor—serve as
conclusive evidence
Teh Bee v Maruthamuthu -Under the
Torrens System the register is everything

The Genesis of Torrens System

1. Introduction of Torrens system in Australia, conceived by Sir Robert Torrens

2. South Australia – Real Property Act 1858 – system of conveyancing
3. Influenced by Merchant Shipping Act 1854
4. Hanseatic towns (North German), where core principle is that no transfer of mortgage or
release of mortgage is valid until endorsed on the register. Concept of a conclusive register.
5. Another principle is that the mortgagee could sell on default although he could not
foreclose.

(a) Purpose and Effect of Torrens system

1. System of title by registration

2. Purpose : simplify titles to land
3. General effect on property law: certainty

I. Conclusiveness of the Register

1. Register Document of Title (RDT/The Register)
a) Two principles:
o The mirror principle
o The curtain principle
 2. The register is everything – Teh Bee v K Maruthamuthu

The Mirror Principle

1. The register reflects all the facts and interests of the land such as the name of proprietor, land
descriptions, area of the land and particulars of the persons that have registered interests on
the land.
2. S 340 NLC:
-The title or interest of any person or body for the time being registered as proprietor of any land,
or in whose name any lease, charge or easement is for the time being registered, shall, subject to
the following provisions of this section, be indefeasible.

The Curtain Principle

1. A potential land buyer may only need to look at the register to get the information on the land
that he is interested in without counter checking with other documents.
2. S 89 NLC:
-Every register document of title duly registered under this Chapter shall, subject to the
provisions of this Act, be conclusive evidence…
3. -The register is everything – Teh Bee v K Maruthamuthu
4. Creelman v Hudson Bay Insurance Co
-And to enable an investigation to take place as to the right of the person to appear upon the
register which he holds the certificate which is the evidence of his title, would be to defeat the
very purpose and object of the statute of registration.

II. Indefeasibility
1. Indefeasibility of title and interest is guaranteed.
2. S 92(1) NLC:
The alienation of State land to any person or body under final title shall confer on that person
or body a title to the land which shall be indefeasible.

3. S 340 NLC:
-The title or interest of any person or body for the time being registered as proprietor of any
land, or in whose name any lease, charge or easement is for the time being registered, shall,
subject to the following provisions of this section, be indefeasible.
 4. However, there are exceptions.

III. Registration
1. The importance of registration
2. S 206(1)(b) NLC:
-no instrument effecting any such dealing shall operate to transfer the title to any alienated
land or, as the case may be, to create, transfer or otherwise affect any interest therein, until it
has been registered…

3. E.g. A purchaser does not acquire legal title until the transfer to him is registered.
4. Dealings recognised under the NLC must be registered or endorsed.
5. Transfers, charges and leases
6. Tenancies exempt from registration, statutory liens
7. Caveats

IV. Caveat system

1. To protect an unregistered interest.
2. 4 types of caveats:
a) Registrar’s caveat,
b) private caveat,
c) lien-holder’s caveat,
d) trust caveat.

V. No adverse possession
1. No adverse possession against the State nor against the registered proprietor of any land.
2. Title to State land can only be acquired by the process of alienation and no other.
3. S 48 NLC:
-No title to State land shall be acquired by possession, unlawful occupation or occupation
under any licence for any period whatsoever.

4. S 341 NLC:
-Adverse possession of land for any length of time whatsoever shall not constitute a bar to the
bringing of any action for the recovery thereof by the proprietor…

5. Sidek & Ors v The State of Perak [1982] 1 MLJ 313

Facts:
 • The appellants came to Perak and opened up a jungle area in Kg Gajah. Other settlers also
settled in the area.

• The Government resettled some settlers to the land that the appellants were occupying.

• The appellants were given notice to vacate the land.

• The appellants claimed that they were entitled in law and equity to be in possession of the
land that they pioneered and occupied.

Appellant’s grounds of support:

• The DO had promised them 3 acres of padi land subject to successful interviews. • Utusan
Malaysia published an article stating that the State Director of Lands and Mines promised
each pioneer settler 5 acres of padi land.

Government of Perak:

• The appellants had no cause of action in law or equity as they were squatters.

Held: Federal Court:

1. The appellants had no cause of action in law or equity as they were squatters

2. Section 48 is against them

3. The only way to obtain State land is by way of NLC.

VI. Reversion to the State

1. Alienated land will revert to the State under several circumstances.
2. S 46(1) NLC
(a) upon the expiry of the term (if any) specified in the document of title thereto;

(b) upon the publication in the Gazette of a notice under section 130 (that is to say, a notice
published on the making of an order of forfeiture by the Land Administrator on the grounds of
non-payment of rent or breach of condition);

(c) in the circumstances mentioned in sections 351 and 352 (which relate respectively to the
death of a proprietor without successors, and the abandonment of title by proprietors); and

(d) upon the surrender thereof in accordance with the provisions of Part Twelve…
VII. Equity
1. Failure to register or non-compliance with the requirements of NLC
2. E.g. Unregistered charge, failure to enter a lien-holder’scaveat.
3. NLC is not concerned with dealings which do not comply with its requirements. No remedies
under NLC.
• Would equity apply?

1. S 6 Civil Law Act 1956 excludes the application in Malaysia of English land tenure (including
English equitable principles relating to land tenure – e.g. mortgagor’s equity of
redemption).
2. S 6 CLA:
-Nothing in this Part shall be taken to introduce into Malaysia or any of the States comprised
therein any part of the law of England relating to the tenure or conveyance or assurance of or
succession to any immovable property or any estate, right or interest therein.

3. Haji Abdul Rahman v Mohamed Hassan [1917] AC 209

Facts:
The creditor lent money to debtor. The debtor transfers his land to the creditor with a
collateral agreement if the debtor repays the creditor within six months the land will be
retransferred to him.
Held:
It was held by the trial judge that the transaction was similar to the common law mortgage.
Thus he concluded that once a mortgage will always be a mortgage. The debtor was allowed
to redeem the land even after the period for repayment had lapsed.
On appeal the Privy Council held that having regard to s. 4 of the Registration of titles
Regulation, 1891, the agreement conferred upon the debtor no real right in the land, but
merely a contractual right.
Lord Dunedin at page 216:
"It seems to their lordships that the learned judges, in these observations, have been too much
swayed by the doctrines of English equity, and not paid sufficient attention to the fact that
they were dealing with a totally different land law, namely, a system of registration of title
contained in a codifying enactment. The very phrase "equity of redemption" is quite
inapplicable in the circumstances. There is no provision in the regulation for mortgage apart
from what is described as a "charge".
4. However, there is nothing in NLC that prohibits the application of general equitable
principles.
5. Therefore, general equitable principles apply by virtue of S 3 CLA to the extent that they are
not inconsistent with NLC.
6. Another provision is S 206(3) NLC where it states that provisions of the NLC which require
that dealings be registered shall not ‘affect the contractual operation of any transaction
relating to alienated land or any interest therein.’
7. Mahadevan v Manilal & Sons [1984] 1 MLJ 266
H: an agreement to secure a debt by land – create equitable charge, give rise to equitable right
though not registered under NLC, so the remedy can’t be granted as per the NLC. If failed to
register, lender may be able to seek

1.5 Dealings under National Land Code 1965

Dealings under NLC

1. “Dealings” definition in section 5

2. Any transaction with respect to alienated land
3. Effected under the powers conferred under Division IV
4. Does not include any caveat or prohibitory order.

Types of dealings

1. S.205 (1) Dealings capable of being registered are those in Parts Fourteen to Seventeen
only, i.e.:
a) Transfers
b) Leases
c) Charges
d) Easements
e) -No title or interest in land will be created until the instruments affecting these dealings
have been registered.

-Dealings not capable of registration:

1. Tenancies exempt from registration (TER)

2. Liens

S 206: Need for proper instrument of dealing duly registered.

(1) Subject to the following provisions of this section-

(a) every dealing under this Act shall be effected by an instrument complying with the
requirements of sections 207 to 212; and

(b) no instrument effecting any such dealing shall operate to transfer the title to any alienated
land or, as the case may be, to create, transfer or otherwise affect any interest therein, until it has
been registered under Part Eighteen.

(2) The provisions of sub-section (1) shall not apply to

(a) the creation of, or other dealings affecting, tenancies exempt from registration (which may be
effected, instead, as mentioned in subsection (2) of section 213); or

(b) the creation of liens (which may be created, instead, as mentioned in section 281).

Effect of unregistered dealings

S. 206

(3) Nothing in sub-section (1) shall affect the contractual operation of any transaction relating to
alienated land or any interest therein.

-Unregistered charge: Mahadevan v Manilal

-An agreement 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 NLC…is created.

1.6 Basic land law concepts and terminology

Terms Meanings
Ownership Ownership signifies the title to a subject matter, movable/immovable.
Ownership confers the owner the right to (1) exclusive use and
enjoyment, (2) the right to transfer/alienate and also (3) right to
possess, (4) right to transmit upon death.

In respect of land, ownership denotes the right to exclusive but not

absolute enjoyment because of the various conditions imposed by the
state in respect of its use and enjoyment.
Possession Signifies something lesser interest as of an ownership. A person who is
the registered proprietorship of the land has the ownership of the land
whereas a person who has a lease of the land only has possession.

Title Title to land is evidenced by a document like the issue or register

document of title, such as the IDT.

Interest Interest usually involved someone other than the owner. Denotes
something less than proprietorship or ownership. In context of the
NLC, interest in land would be taken to mean a registered lease, charge
or easement as well as a statutory lien or a tenancy exempt from
registration created in respect thereof.

Purchaser of land is said to have the tile to land when the land is
registered under his name.
A person taking a lease or a charge of the land of a registered owner is
said to have interest in the land.
Legal Interest LI is interest which have been validly and formally created in
accordance with the requirements of the statute such as the creation of
a registered charge, lease or easement in accordance with provision of
NLC. Also known as registered interest. (Got remedy if it is registered
since it is recognized by law)

Once LI created, enforced against the whole world, in that it is binding

on 3rd parties who will take subject to that interest and that in the
absence of fraud, it cannot be defeated by an unregistered interest.
Equitable Interest Interest held by virtue of an equitable title (a title that indicates a
beneficial interest in property and that gives the holder the right to
acquire formal legal title) or claimed on equitable grounds, such as
the interest held by a trust beneficiary. (Cannot claim under NLC, thus
can only claim equitable remedy, such as s.206 of NLC)

Exp: In the case of trust, this is a relationship whereby one person, the
trustee holds land for the benefit of another person(beneficiary).
Trustee here has legal interest, beneficiary has equitable interest.
 It is liable to be defeated by the registrations of any interest created in
the absence of fraud.

Disposal One of the way to distribute land by the State. Refers to the granting of
certain kind of rights, whether proprietary or otherwise, by the State
in respect of any land generally and in favour of individuals or bodies,
whether private/public. (Once transferred to you the land, you have
rights to deal with the land)

Such disposal can be in form of alienation/ issue of temporary

occupation licence/ permit/ grant of lease of reserved land.
Dealings Means any transaction undertaken between individuals or bodies,
private/public, effected with respect to alienated land but does not
include any caveat or prohibitory order.

Disposal denotes transaction between State and individual/bodies.

Dealings transaction between such individuals or bodies themselves.
Restriction in interest Means any limitation imposed by the State on the powers of a
registered proprietor to deal with his land by way of a transfer or the
creation of a lease/charge/easement/tenancy or statutory lien over his
land as well as his powers to subdivide, partition or amalgamate his
land. (State has power to put a restriction on the land)
Conditions Refers to the imposition by the State of obligations relating to the use
of land for agricultural, building and industrial purposes.

Conditions may be imposed by State to regulate the use of land held

under a permit or temporary occupation license or by way of a lease of
reserved land.

Different category of lands – residential, agriculture, commercial etc

Real Estate Usually refers to immovable property such as land, buildings and
everything which is part of a piece of land or affixed to it

Personal Estate Taken to refer to movable property such as goods and chattels.
Note:

 Chargor: the one who charge the land to charge (the bank who provides the loan)
 Chargee: the one who ask for the loan, and provide his land as security (to whom the land
was charged)

1.7 Applicability of English doctrine of equity relating to land in Malaysia

The Malaysian Torrens system as embodied and codified in the National Land Code 1965
is a system of registration of tiles which was designed to provide simplicity and certitude (Oh
Hiam v Tham Kong) and is totally different land law system from that in England. Under the
Torrens system, the register is everything (Teh Bee v Maruthamuthu). In safeguarding the
Torrens systems, section 6 of the Civil Law Act 1956 (CLA) prohibits the reception of the law of
England in relation to tenure, conveyancing, assurance or succession to any immovable property
or any estate, rights or interest therein. Though the section was devised to met its purpose, the
court in Wilkins v Kannamal held that the Torrens system is a system of conveyancing; it does
not abrogate the rules of equity.

Section 3 of CLA allows the general reception of English equity in cases where there is
lacuna in the local law and where the application of English equity is suitable to local
circumstances.

In the case Devi v Francis, the appellant occupied that part of the respondent’s land on
which stood a house owned by the appellant. The appellant had commenced occupation of the
said house after the purchase of the same from the respondent’s mother and subsequently the
purchase was incorporated in an agreement. The respondent gave notice and claimed possession
of the ground on which the house was erected. The court applied the principles of equitable
estoppel and rejected the contention by the counsel for the respondent that English equity was
not applicable to land matters in Malaysia in view of the section 6 of CLO. Further, the Lordship
held that the land law of England is one thing and equity another matter and it is expressly
provided in section 3(1) of the same Ordinance that the court shall apply the common law of
England and the rules of equity and in section 3(2).

In UMBC v PHT Kota Tinggi, the court dealing with the question whether English
equitable rules relating to relief against forfeiture, had expressly stated that section 6 wide
enough to cover the said principles of equity. The equitable rules were precluded by the section
from being applied. However, the court went further to state that English equitable principles of
general application are applicable to land matter in Malaysia so long as their application is not
inconsistent with the stated aims and objectives of the Malaysian Torrens system as embodied in
the express provisions of the National Land Code 1965. Therefore, section 6 even though clearly
bar the application of equitable principles in relation to tenure and conveyancing but it does not
have any effect to the applicability of English equitable principles of general application.

The effect section 6 also can be seen in the light of the claim in personam, where the Privy
Council used its inherent power of jurisdiction held if a claim is made based on the equitable
principles of general application on a right ad rem which is right in personam, section 6 does not
abrogate the applicability. In Oh Hiam v Tham Kong, the parties entered in a contract of sale of
certain pieces of land. The transfer was included with a land on which stood the house on the
ground of common mistake. The High court set aside the sale and the transfer of the land. On
appeal the Federal Court allow the appeal on the ground there was no mistake. When the matter
reached the Privy Council, the issue was whether, the equitable remedy of rectification was
available to the appellant notwithstanding the purchaser being the new registered owner of the
fact his title was indefeasible under NLC. The Privy Council held equitable remedy of rectification
was available to the appellant when the claim was based on right in personam.

Another situation where the Court had used a particular doctrine under English equitable
principles of general application against the section 6 is the doctrine of bare trust. The
application of the doctrine of bare trust had been clouded but Malaysian court had applied on
numerous occasions without hesitation in land matters. Be that as it may, Lord Roskill in Chin
Choy v Collector of Stamp Duties, had vehemently expressed that though the vendor became in
equity, a trustee for the purchaser of an estate sold was a peculiarity of English land law
nevertheless held that section 6 of the CLO prohibits the reception of any English law pertaining
to land matters in Malaysia. This obiter dicta, however had been rejected by the Federal Court
in Borneo Housing Mortgage Finance v Time Engineering and affirmed that the doctrine of
bare trustee applicable in a modified form in Malaysia.

It is pertinent to note that the High Court in Templeton v Law Yat Holding, while
conforming that the Plaintiff was entitle for easement, held that the NLC [s 206(3)] shall not affect
the contractual operation of any transaction relating to alienated land and further of the view that
this subsection provides authority for the liberal application of equity whenever there is a basis
for that. This is a clear indication that the Court never accepted the effect of section 6 as a whole
but rather to halt any matters which has a direction relation to the land matters.

In Bhagwan Sigh Co. v Hock Hin Bros, the court dealt with a purchase of land whereby
of one of the purchasers died after the execution of the transfer by the vendor which made the
original transfer incapable of registration the sub-purchaser was entitled to an order directing
the Registrar of Titles to register what he had bought. In holding that the antecedent contract was
a binding contract, Thomson J. (as he then was) gave the order asked for and held that the English
equitable principles in determining a question of priorities of caveats applicable and the Torrens
system does not prevent the court from doing equity where the rights of third parties have not
been intervened.

Conclusion
Section 6 was enacted to prevent the importation of the English law land under section
3(1) to the land matters in Malaysia. However, in the interest of justice, the court had use the
English equitable principles of general application in matters pertaining to land law and granted
relieves to the affected parties where there was lacuna in the local law. Thus, it is my humble
opinion that the effect of section 6 does not conclusively and/or wholly bar the application of the
equitable principles in the Malaysian land law.