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MALAYSIAN JUDGMENTS & RULINGS

[2018] MYCA 103 ENGLISH

Kumpulan Darul Ehsan Berhad v Pentadbir Tanah Daerah Sepang and 3 Other Appeals
Suit Number: Rayuan-Rayuan Sivil No. B-01(A)-402-10/2016, B-01(A)-403-10/2016, B-01(A)-404-10/2016 & B-01(A)-405-10/2016 

Real estate – Compulsory acquisition of land – Award of compensation by Land Administrator – Objection by landowner

Real estate – Whether acquired land to be used for commercial building or residential building – Whether higher compensation can be claimed – Whether appeal precluded under section 40D of the Land Acquisition Act 1960 – Whether burden of proof discharged in establishing the category of land use of the acquired lands

JUDGMENT

INTRODUCTION

[1] The four appeals which were heard together relate to the four awards of compensation made by the High Court in respect of the compulsory acquisition of four pieces of land under the Land Acquisition Act 1960 (LAA 1960).

[2] The appellants were the registered proprietors of the four pieces of land. Pursuant to the compulsory acquisitions of the four pieces of land, various sums of awards of compensation were made in favour of the appellants by the Land Administrator.

[3] Dissatisfied with the awards made by the Land Administrator, the appellants lodged four applications under s 38(1) of the LAA 1960 to refer the matter to the High Court. Pursuant thereto, the appellants filed four Forms N objecting to the amount of the compensation. The grounds of the objections taken by the appellant are as follows:

3. Bantahan saya adalah terhadap:

a) ukuran luas tanah itu;

b) jumlah pampasan;

c) orang orang yang menerima pampasan;

d) pembahagian pemberian.

4. Alasan-alasan bantahan saya adalah seperti berikut:

1. Pampasan yang ditawarkan oleh Pentadbir Tanah semasa perbicaraan akhir pada 29 Mei 2014 adalah rendah.

2. Pentadbir Tanah telah gagal dan/atau abai untuk memberi pertimbangan yang sewajarnya ke atas Laporan dan Penilaian oleh penilai dilantik iaitu Tetuan A Jalil & Co Sdn Bhd.

[4] The main contention of the appellant in the High Court was that the category of land use of the acquired lands were ‘bangunan perdagangan’ (commercial building); whereas the respondent took the position that it was ‘bangunan kediaman’ (residential building). As such, the appellant claims to be entitled to a higher amount of compensation if the acquired lands had been valued on the basis of commercial building.

FINDINGS OF THE HIGH COURT

[5] After hearing of the parties, the High Court sitting with two assessors dismissed the appellant’s four applications.

[6] The opinion of the assessors’ may be summarised as follows:

(i) The ‘Kategori Kegunaan Tanah’ (category of land use) of the acquired lands is stated as ‘Bangunan’;

(ii) The ‘Syarat Nyata’ (express condition) is stated to be ‘Pembinaan bangunan-bangunan mengikut JPBD Negeri Selangor’ (construction of building in accordance with the Town and Country Planning Department of the State of Selangor);

(iii) According to the valuation reports of both the appellant and respondent, the acquired lands were zoned by JPBD and Majlis Perbandaran Sepang for ‘kediaman dan badan air’ (residential and water reservoir);

(iv) Even though the acquired lands were alienated by the State Government to the appellant in 2004, the appellant did not produce any documents to show that the alienation of the land was made on the basis of commercial land use category;

(v) The rate of quit rent for the acquired lands is not sufficient to confirm that the land use as being commercial building because the express condition is subject to the JPBD zoning;

(vi) Up to the date of the publication in the Gazette of the declaration made under s 8 of the LAA 1960, there was no application made to convert the category of land use from residential to commercial;

(vii) The six comparables of sales transactions between 2006 to 2012 referred to by the appellant’s valuer were discounted because the category of land use in respect of the same were different from that of the acquired lands;

(viii) The appellant failed to make out a prima facie case that the acquired lands fell under the category of land use of commercial; and

(ix) Therefore, the valuations of the respondent were upheld.

[7] In his written judgment, the learned judge agreed with the opinion of the assessors. The learned judge rejected the appellant’s argument that the quit rent paid by the appellant for the acquired lands were made on the basis of commercial land. The appellant’s valuer is bound by the express conditions endorsed on the register document of title. Pursuant to s 104 of the National Land Code, every condition shall run with the land to which it relates and shall bind the proprietor thereof; therefore, the category of land use of ‘bangunan’ subject to the express condition that construction of building in accordance with the Town and Country Planning Department of the State of Selangor is binding on the appellant qua registered proprietor of the acquired lands (Perbadanan Kemajuan Negeri Selangor v Selangor Country Club Sdn Bhd [2016] 1 LNS 495; Hamidah Mohd Khalid & 2 lagi v Pentadbir Tanah Daerah Gombak [2016] 1 LNS 503). As such, the learned judge found as a fact that the category of land use of the acquired lands were ‘tanah kategori bangunan dengan syarat nyata pembinaan bangunan mengikut JPBD Negeri Selangor’.

SUBMISSION OF PARTIES

[8] Learned counsel for the appellant argued that the main issue relates to the category of land use of the acquired lands. As the appellant is challenging the error of law, the appeals are maintainable in law and not fall within the meaning of s 40D of the LAA 1960 (Koriah bt Sudar v Pentadbir Tanah Kuala Langat [2013] 3 MLJ 695; Mohd Shah Daud v Pentadbir Tanah dan Jajahan Kota Bharu [2016] 6 CLJ 806 (CA)).

[9] Learned counsel also argued that as the acquired lands were subject to the building category and the aforesaid JPBD express condition, the endorsements of land use and express condition on the document of title to the acquired lands must be read so as to be consistent with the zoning of the acquired lands under the Town and Country Planning Act 1976 (TCPA 1976). As such, the learned judge erroneously relied solely on the only evidence adduced by the respondent through the Government valuer, which was a purported internal verification document issued by Majlis Perbandaran Sepang (“MPS”) allegedly confirming that the acquired lands were zoned for ‘residential and water reservoir’. He submitted that the learned judge erred in law in rejecting the evidence of the annual rates levied by the State Authority on the acquired lands which clearly demonstrated that the State Authority had computed the annual rates on the basis of ‘commercial’ zoning as opposed to ‘residential’ zoning. The MPS document is not an official document confirming the zoning of the acquired lands within the meaning of the TCPA 1976 and should not be relied upon as evidence of zoning of the acquired lands.

[10] In reply, learned Assistant State Legal Adviser (ALA) argued that the appellant’s appeal is in fact and in substance an appeal against the compensation which is barred under s 40D of the LAA 1960. Secondly, learned ALA argued that no application was made to change the category of land use up to the date of the publication of the acquisition in the Gazette. The learned judge had made a finding of fact that the acquired lands were ‘tanah kategori bangunan dengan syarat nyata pembinaan bangunan mengikut JPBD Negeri Selangor. The Government valuer had considered the planning papers of MPS and found that the acquired lands were zoned as residential and water reservoir. As such the learned judge rightly rejected the appellant’s contention that the category of the land use was commercial.

DECISION

[11] In our considered view, the present appeals emanate from the application filed by the appellant in Form N objecting to the amount of compensation. A perusal of the Forms N in question shows that the appellant’s objection is only in regard to the amount of compensation (see para. 3 above). In fact, the appellant’s claim before the High Court and this Court is for a higher compensation premised on the category of land use of the acquired lands being commercial as opposed to residential. Accordingly, we agree with the submission of learned ALA and hold that the appeal is precluded under s 40D of the LAA 1960.

[12] Even if the appellant’s appeal is not barred under s 40D, the burden of proof was on the appellants to establish that the category of land use of the acquired lands was commercial and this they failed to do. The appellant’s argument that the annual rates levied by the State Authority on the acquired lands demonstrate that the annual rates were calculated and levied based on commercial zoning is without merit. Even if the annual rates were based on commercial zoning, the fact remains that it is for the appellant to prove that fact. At any rate, the law is clear. The express conditions endorsed on the issue document of title to the acquired lands clearly states that the construction of buildings must be in accordance with JPBD zoning. On the record, we are satisfied that apart from this bare assertion, the appellant did not furnish any supporting evidence to back up their case. The applications in Forms N were brought by the appellant and pursuant to para. 2(1) of the Third Schedule (Evidence and Procedure in Land Reference Cases) to the LAA 1960, it is clearly stipulated that the appellant’s valuer’s report alone must establish a prima facie case for the appellant. As the appellant has failed to establish a prima facie case, it is accordingly not open to the appellant to argue that it is for the respondent to prove otherwise. We have perused the appeal record and are satisfied that the learned judge and the assessors have considered all the relevant factors in coming to the decision. We are not persuaded that the learned judge committed any appealable error in law.

[13] For the foregoing reasons, we found no merits in the issues raised by the appellant. The appeal was dismissed with costs.

sgd

Vernon Ong
Judge
Court of Appeal
Malaysia

Dated: 25th January 2018

COUNSEL

For the Appellant: Robert Lazar (Lai Wai Fong and Mohd Saiful Hadi with him), Messrs Ainul Azam & Co

For the Respondent: Etty Eliany Tesno (Naziah Mokhtar with her), Kamar Penasihat Undang-Undang Negeri Selangor

Legislation referred to:

Land Acquisition Act 1960, Sections 8, 38(1), 40D

National Land Code, Section 104

Town and Country Planning Act 1976

Judgments referred to:

Hamidah Mohd Khalid & 2 lagi v Pentadbir Tanah Daerah Gombak [2016] 1 LNS 503

Koriah bt Sudar v Pentadbir Tanah Kuala Langat [2013] 3 MLJ 695

Mohd Shah Daud v Pentadbir Tanah dan Jajahan Kota Bharu [2016] 6 CLJ 806 (CA)

Perbadanan Kemajuan Negeri Selangor v Selangor Country Club Sdn Bhd [2016] 1 LNS 495

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