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[2018] MYCA 300 ENGLISH

Tahps Group Berhad v Pentadbir Tanah Daerah Raub
Suit Number: Civil Appeal No. C-01(NCVC)(A)-158-05/2015 

Land law – Land acquisition – Compensation – Sections 40D(3) and section 49(1) of the Land Acquisition Act 1963 – Semenyih Jaya Sdn Bhd v Pentadbir Tanah Daerah Hulu Langat & Another case

JUDGMENT

[1] This appeal was against the decision of the High Court at Temerloh, Pahang, dismissing the appellant’s claim for an increase in compensation for, inter alia, severance and injurious affection.

[2] The undisputed facts are as follows. The appellant is the registered proprietor of the land held under Grant No. 5248, Lot No. 6021, Mukim Gali, District of Raub, Pahang (“the subject land”) measuring 402.1129 hectares.

[3] A portion of the subject land measuring 16.0290 hectares (“the scheduled land”) was acquired to build a highway, resulting in the subject land being severed into 2 portions without any access between the 2 portions.

[4] The Land Administrator awarded RM2,965,365.00 for market value of the scheduled land at RM185,000.00 per hectare, RM714,534.41 for severance and RM238,178.12 for injurious affection.

[5] On appeal, the High Court affirmed the Land Administrator’s award for market value, and further awarded RM100,000.00 for disturbance and RM1 million for accommodation works.

[6] The present appeal before us was against that part of the High Court decision on severance and injurious affection as well as the power of the assessors to determine the quantum of compensation.

[7] At the outset of the hearing, the respondent raised a preliminary objection, which we upheld by a unanimous decision. The appellant’s appeal was accordingly dismissed with costs. Consequently, we did not hear the merits of the appellant’s appeal.

[8] The respondent’s preliminary objection was grounded on section 40D(3) and section 49(1) of the Land Acquisition Act 1963 (“the LAA”), which we reproduce below for ease of reference:

Section 40D(3)

“(3) Any decision made under this section is final and there shall be no further appeal to a higher Court on the matter.”

Section 49(1)

“(1) Any person interested, including the Land Administrator and any person or corporation on whose behalf the proceedings were instituted pursuant to section 3 may appeal from a decision of the Court to the Court of Appeal and to the Federal Court:

Provided that where the decision comprises an award of compensation there shall be no appeal therefrom.”

[9] It was argued by learned counsel for the respondent that since the appellant’s appeal was against the amount of compensation awarded by the Land Administrator, it was prohibited by the proviso to section 49(1) of the LAA.

[10] The respondent cited the Federal Court case of Calamas Sdn Bhd v Pentadbir Tanah Batang Padang [2011] 5 CLJ 125 where it was decided as follows:

“Coming back to s. 40D(3) of the Act, I am of the view that the said section clearly stipulates that "Any decision made under this section is final and there shall be no further appeal to a higher court on the matter”.”

“It is trite law that courts must give effect to the clear provisions of the law and by virtue of ss. 40D(3) and 49(1) of the Act, which were not ambiguous in any way, the appellant was precluded from appealing against the order of compensation issued by the trial judge.”

[11] The same Court in Syed Hussain bin Syed Junid & 9 Yg Lain v Pentadbir Tanah Negeri Perlis [2013] 6 MLJ 626 came to the same conclusion as in Calamas (supra).

[12] We were also referred to section 68(1) of the Courts of Judicature Act 1964 which provides:

“(1) No appeal shall be brought to the Court of Appeal in any of the following cases:

(a) ...;

(b) ...;

(c) ...; and

(d) where, by any written law for the time being in force, the judgment or order of the High Court is expressly declared to be final.”

[13] The doctrine of stare decisis required us to abide by the Federal Court decisions in Calamas and Syed Hussain. Thus, the law as it stood at the time of our decision (at least to our understanding) was that there was a complete bar to all appeals to the Court of Appeal from the High Court on an award of compensation, which was what the appellant’s appeal was concerned with.

[14] However, the Federal Court had since delivered its decision in Semenyih Jaya Sdn Bhd v Pentadbir Tanah Daerah Hulu Langat & Another case [2017] 5 CLJ 526 where it was decided otherwise. It was held that the bar to appeal in section 49(1) of the LAA is limited to issues of fact on ground of quantum of compensation.

[15] Therefore, an aggrieved party has the right to appeal against the decision of the High Court on questions of law. Section 40D(3) was struck down as being unconstitutional.

[16] The Federal Court explained that Calamas and Syed Hussain do not represent a bar to appeal against any decision of the High Court on compensation, and that even if the two cases represent a bar to appeal against any decision which comprises compensation, the Federal Court in those two cases were not invited to consider issues of constitutionality or the restrictive dimension of section 49(1) in the face of Article 13 of the Federal Constitution, since it was never raised there. Instead, the issues in the two cases merely revolved around the construction of section 40D(3) and section 49(1) of the LAA.

[17] To better understand the ratio decidendi of Semenyih Jaya, we think it would be useful to cite in extenso the relevant parts of the judgment delivered by Zainun Ali FCJ, as follows:

[140] The application of sub-s. 49(1) of the Act has been set out by this court in Syed Hussain Syed Junid & Ors v. Pentadbir Tanah Negeri Perlis [2013] 9 CLJ 152; [2013] 6 MLJ 626. It was held that based on sub-s. 49(1), an aggrieved party has the right to appeal to the Court of Appeal and therefore to the Federal Court without having to resort to the leave process under sub-s. 96(a) of CJA (per Raus Sharif PCA).

[141] On the other hand, the proviso to sub-s. 49(1) seeks to qualify a full right of appeal (which is given in the body of the section) in that there can be no appeal "where the decision comprises an award of compensation".

[142] The proviso should not be construed to disembody the section. A proviso has to be read as being part of the main section and not independent of it. As Viscount Dilhorne said in the Privy Council in Commissioner of Stamp Duties v. Atwill [1973] 1 All ER 576 at 579:

... It is the substance and content of the enactment, not its form, which has to be considered, and that which is expressed to be a proviso may itself add to and not merely limit or qualify that which precedes it.

"Decision Comprises An Award Of Compensation" In Subsection 49(1) Of The Act

[143] The proviso to sub-s. 49(1) of the Act explicitly sets out a limitation on the content of the appeal - in that there can be no appeal "where the decision comprises an award of compensation".

[144] A literal reading of the proviso to s. 49 of the Act would mean that there is a complete bar on all appeals to the Court of Appeal from the High Court on a question of compensation.

[145] On behalf of the respondent, the Senior Federal Counsel submitted that the language of the proviso to sub-s. 49(1) is clear and unequivocal in that where the High Court's decision is grounded on compensation, no appeal can be brought against that decision. The courts must give effect to the clear provisions of the law.

[146] The above contention finds support in two decisions of the Federal Court. In Calamas Sdn Bhd v. Pentadbir Tanah Batang Padang [2011] 5 CLJ 125, the Federal Court inter alia, held that:

... In the instant appeal I do not see anything ambiguous in ss. 40D and 49(1) of the Act. In view of this, I am of the view that the Appellant is precluded from appealing against the order of compensation issued by the learned judge.

[147] A similar pronouncement was made in the case of Syed Hussain (supra) where His Lordship Raus Sharif PCA said:

With the introduction of section 40D and the amendment to the proviso of section 49(1) the intention of Parliament is very clear, i.e. to preclude any party from appealing against the order of compensation made by the High Court...

(emphasis added)

[148] We are of the view that this purported ouster of the right of appeal in respect of compensation ought to be narrowly and strictly construed. One has to revert to the tangible weight of the wording of art. 13(1) of the Federal Constitution where the safeguards are that an acquisition must be "in accordance with law" and that the compensation should be "adequate compensation". The proviso to sub-s. 49(1) of the Act must be strictly interpreted in favour of the person who has been deprived of its property so as to give meaning to the constitutional protection of a person's right to his property.

[149] It is axiomatic that a right of appeal is statutory. What then is the effect of this? First, it simply means that when conferred by statute, the right of appeal becomes a vested right. Correspondingly the jurisdiction of the court to hear appeals is also conferred by statute (see Auto Dunia Sdn Bhd v. Wong Sai Fatt & Ors [1995] 3 CLJ 485; [1995] 2 MLJ 549; Wan Sagar Wan Embong v. Harun Taib [2008] 5 CLJ 14; [2008] 4 MLJ 473).

[150] A fortiori, the nature of the appeal depends on the terms of the statute conferring that right. It is a matter of construction to be given to the provisions conferring the right to appeal. Legislative intention can also be found by examining the legislation as a whole. Limiting the right to bring an appeal is a way of encouraging finality. If an examination of the language and policy of the Act granting the right of appeal concludes that Parliament intends to limit an appeal, the court must give effect to it.

[151] We have perused the facts and the decisions of this court in Calamas (supra) and Syed Hussain (supra). The cases do not represent a bar to appeal against any decision of the High Court on compensation. Even if Calamas (supra) and Syed Hussain (supra) represent a bar to appeal against any decision which comprises compensation, the Federal Court in these two cases were not invited to consider issues of constitutionality or the restrictive dimension of sub-s. 49(1) in the face of art. 13 of the Federal Constitution, since it was never raised there. Instead, the issues in these two cases merely revolved around the construction of sub-s. 40D(3) and sub-s. 49(1) of the Act.

[152] In our view, what needs clarification here is the phrase "against the order of compensation made by the High Court" which was used by the Federal Court, both in Calamas (supra) and Syed Hussain (supra). The question is whether such expression denotes any decision issued by the High Court with regard to compensation.

[153] In our view, this does not appear to be the case. It is obvious that the subject matter of the appeals in both cases was purely on the inadequacy of quantum of compensation awarded by the High Court. It was on this basis that Hashim Yussof FCJ in Calamas (supra), concluded that:

It would appear that from the grounds of judgment of the Court of Appeal (at p. 16 appeal record volume I), the issue put forward before the court was whether the learned judge was correct in determining the amount of compensation to be awarded to the appellant (emphasis added).

... I am of the view that the said section clearly stipulates that "Any decision made under this section is final and there shall be no further appeal to a higher court on the matter".

It is trite law that courts must give effect to the clear provisions of the law. In the instant appeal I do not see anything ambiguous in ss. 40D(3) and 49(1) of the Act. In view of this, I am of the view that the appellant is precluded from appealing against the order of compensation issued by the learned trial judge.

[154] The position is reinforced by the restrictive approach taken by the Federal Court in the interpretation of the proviso to sub-s. 49(1) of the Act. In Syed Hussain (supra), His Lordship Raus Sharif PCA held that because of its legislative background, the proviso to sub-s. 49(1) of the Act must be read together with the provision of sub-s. 40D(3) of the Act. The intention of Parliament is clear. There can be no appeal against the decision of the High Court on the amount of compensation. The relevant part of the judgment reads:

Thus while section 49(1) of the LAA allows any interested person to appeal against the decision of the High Court to the Court of Appeal, section 40D appears to have restricted the ambit of such an appeal. Section 40D(3) clearly provides that any decision as to the amount of compensation award shall be final and there shall be no further appeal to the higher Court on the matter. This non-appealable provision of section 40D(3) is further reinforced by the proviso of section 49(1) which reads:

Provided that where the decision comprises an award of compensation there shall be no appeal therefrom.

Historically speaking, s. 40D is a new section introduced by the Land Acquisition (Amendment) Act 1997 (Amendment Act 1997). The Amendment Act 1997 had also inter alia amended the proviso of s. 49(1) of the LAA.

[155] To sum up, the proviso to sub-s. 49(1) of the Act does not represent a complete bar on all appeals to the Court of Appeal from the High Court on all questions of compensation. Instead, the bar to appeal in sub-s. 49(1) of the Act is limited to issues of fact on ground of quantum of compensation. Therefore, an aggrieved party has the right to appeal against the decision of the High Court on questions of law.”

[18] In the face of Semenyih Jaya, our decision to dismiss the appellant’s appeal on a preliminary objection, based as it was on section 40D(3) and the proviso to section 49(1) of the LAA, has turned out to be wrong, and we stand to be corrected.

ABDUL RAHMAN SEBLI
Judge
Court of Appeal Malaysia

Dated: 20 September 2018

COUNSEL

For the Appellant: K L Pang and Z T Chok of Cheah Teh & Su

For the Respondent: Shamsulbahri bin Ibrahim and Nurul Farhana binti, Khalid of the Pahang State Legal Advisor’s office

Legislation referred to:

Courts of Judicature Act 1964, Section 68(1)

Federal Constitution, Article 13

Land Acquisition Act 1963, Sections 40D(3), 49(1)

Judgments referred to:

Calamas Sdn Bhd v Pentadbir Tanah Batang Padang [2011] 5 CLJ 125

Semenyih Jaya Sdn Bhd v Pentadbir Tanah Daerah Hulu Langat & Another Case [2017] 5 CLJ 526

Syed Hussain bin Syed Junid & 9 Yg Lain v Pentadbir Tanah Negeri Perlis [2013] 6 MLJ 626

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