CHING CHEN LENG

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MBEG 1053

QUESTION
Ahmad works in Qatar as a Project Manager. With his big salary, he manages to save
enough money to purchase several properties in Malaysia. When he comes home for
a holiday, he goes to the Johor Land Office to pay the quit rents. Relating to a
particular land in Skudai, the land officer informs him that the quit rents had
already been paid by the registered owner, Ali. Upon further investigation, it is found
that the land had earlier been transferred to Aris. The Form 14A was signed by
Ahmad himself. However, the date of the transfer was 14 January 2015. On that
date, Ahmad was in Qatar. When Ahmad refutes the validity of the transfer, Alis
lawyer argues that his client enjoys indefeasibility of title under National Land Code
1965. Ahmad thinks that this could not happen if the officer in the Land Office is
not negligent in performing his duty.
With reference to the relevant case law on this issue, advise Ahmad his legal rights
under the National Land Code and the law of tort, if relevant.

ANSWER

According to common law, negligence defined as conduct that falls below the
standards of behaviour established by law for the protection of others against
unreasonable risk of harm. A person has acted negligently if he has departed from
the conduct expected of a reasonably prudent person acting under similar
circumstances.

Under the law of tort, in order to be successful in a negligence claim, the claimant
must prove that the defendant owed them a duty of care, the defendant was in
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breach of that duty, the breach of duty caused damages and the damage was not too
remote.

In Malaysia, National Land Code has been used as the guidelines in governing the
matters regarding the land but at the same time common law also applicable. The
issues always arisen regarding the land including the fraud, negligence, void
instrument and misinterpretation. One of the issues is the indefeasibility of title.

According to torrent system, indefeasibility of title is guaranteed under the National

Land Code pursuant to section 89 and 340 but it is not absolute. Section 89 stated
that every register document of title duly registered under alienation under final title
shall be conclusive evidence that title to the land vested in the person for the time
being named therein as proprietor 1 while Section 340 stated that the title of any
such person for the time being registered as proprietor shall be indefeasible.2

There are several issues arisen in this case:

1) Whether the officer in the Land Office performing the breach of duty?
2) Whether the transfer of land from Ahmad to Aris and Aris to Ali is valid?
3) Whether the principle of deferred or immediate indefeasibility is applied to
Ali?

1
2

89
340

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Issue 1
Whether the officer in the Land Office performing the breach of duty?

In Ford Motor Co. v Rushford3, negligence needs to be proven by (1) a duty owed by
the defendant to plaintiff, (2) a breach of duty by the defendant and (3) an injury to
the plaintiff proximately caused by the breach. According to Vazeer Alam Mydin
Meera4, a government servant is protected by the Public Authorities Protection Act
1948 if the issue remains valid 36 months commencing from the date of duty. In
Ahmad case, it is agreed that the land officer is in favour of negligence as the land
officer failed to conduct the duty of care as a land office registrar. This is also
illustrated in Donoghue v Stevenson5, Lord Atkin mentioned that
"The rule that you are to love your neighbour becomes m law you must not injure your
neighbour; and the lawyer's question " Who is my ' neighbour ?" receives a restricted reply. You
must take reasonable care to avoid acts or omissions which you can reasonably foresee would
be likely to injure your neighbour. Who then in law is my neighbour? The answer seems to be
persons who are so closely and directly affected by my act that I ought reasonably to have them
in contemplation as being so affected when I am directing my mind to the acts or omissions
which are called in question."
Refer to Caparo Industries Plc v Dickman 6, Lord Bridge establish the three stage test for imposing a
duty of care, known as Caparo test. Under the Caparo test, the defendant must establish three test (1)
that harm was reasonably foreseeable (2) that there was a relationship of proximity and (3) that it is
fair, just and reasonable to impose a duty of care. In Ahmad case, the land officer is said owe Ahmad
the duty of care.

3
4
5
6

868 N.E.2d 806, 810 (Ind. 2007)

[2013] 8 CLJ 1095 [HC]
(1932) AC 562
(1990) 2 AC 605

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Since it has been established that the land officer owed the plaintiff a duty of care, the plaintiff must
demonstrate that the land officer was in breach of duty. There are two test available, objective test and
Bolam test.
For objective test, the defendant is expected to meet the standard of a reasonable person as illustrated in
Vaughan v Menlove.7 Since the land officer is a professional, the land officer should held to the
standard of a reasonable person within the profession as applied in Wilsher v Essex 8 but the land officer
failed to do so hence he is said to conduct the breach of duty.
For Bolam test, the House of Lord held that:
"I myself would prefer to put it this way, that he is not guilty of negligence if he has acted in
accordance with a practice accepted as proper by a responsible body of medical men skilled in
that particular art . . . Putting it the other way round, a man is not negligent, if he is acting in
accordance with such a practice, merely because there is a body of opinion who would take a
contrary view."

Refer to the Bolam test, the land officer is said to be not guilty of negligence if he has
acted in accordance with a practice accepted as proper by the responsible body.

Issue 2
Whether the transfer of land from Ahmad to Aris and Aris to Ali is valid?

In Ahmad case, Aris imitated Ahmads signature in signing the Form 14A and
transfer the land to his own name and afterward sell the land to Ali.
For the transfer of land from Ahmad to Aris, it says to be a fraud. According to the
Privy Council decision in Assets Co. v Mere Roihi9, fraud meant actual fraud, defined
7
8
9

(1837) 3 Bing N. C. 467

(1988) 1 AC 1074
[1905] AC 176

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as the dishonesty of some sort and not merely constructive or equitable fraud. Other
than that, fraud must be brought home to the person whose registered title is
impeached or to his agents, hence underscoring the requirement which also stated
in Section 340(2)(a) that there must be proof that the registered proprietor or his
agent must be a party or privy to the fraud.10

In Adorna Properties Sdn. Bhd. V. Boonsom Boonyanit 11, standard of proof was
mentioned to prove the forgery beyond the reasonable doubt. If the forgery can be
proved beyond reasonable doubt, the transfer of land from Ahmad to Aris is
forfeiture.

For the transfer of land from Aris to Ali, according to National Land Code section
214(2), it stated that the powers conferred by sub-section (1) shall be exercised in
any particular case subject to (a) any prohibition or limitation imposed by this Act or
any other written law for the time being in force (b) any restriction in interest to
which the land in question is for the time being subject and (c) in relation to leases,
charges and tenancies exempt from the registration, the provisions thereof, express
or implied.12 Hence, Ali is said to obtain a valid transfer as a bona fide purchaser as
illustrated in Adorna Properties Sdn Bhd v. Boonsoom Boonyanit 13 that bona fide
purchasers for value obtained immediate indefeasibility notwithstanding that they
acquired their titles under a forged document. This is also illustrated in Au Meng
Nam & Anor v. Ung Yak Chew & Ors14, the purchaser in good faith able to retain the

10
11
12
13
14

340(2)(a)
[2001] 2 CLJ 133
214(2)
ibid
[2007] 5 MLJ 136

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land title even the transfer is being made under the forged documents. Therefore, Ali
is said to be indefeasible and cannot be challenged.

Issue 3
Whether the principle of deferred or immediate indefeasibility is applied to Ali?

According to Adorna Properties Sdn. Bhd. v. Boonsoom Boonyanit 15, immediate

indefeasibility defined as even if the instrument of transfer was forged, the bona fide
purchased can obtain an indefeasible title to the said lands. This is also illustrated
in Breskvar v Wall16 case, the judge Barwick CJ held that even if the situation which
led to the registration was wrong, void or there was fraud, the registration of the title
still vests title to the registered person.

According to Adorna Properties Sdn Bhd. v. Boonsoom Boonyanit 17 again, deferred

indefeasibility defined that the acquisition of title by registration of a void document
is not valid and did not acquire an indefeasible title. The purchasers title is
defeasible and can be set aside if the real proprietor makes a claim.
For Ahmad case, Ali has acquired the immediate indefeasibility of title as he is a
bona fide purchaser after the purchase in which the forgery was involved. Hence, Ali
registration is valid.

15
16
17

ibid
(1971) 126 CLR 376
ibid

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Thus, Ahmad is barred from making a claim to the land which transferred to Ali
under the principle of immediate indefeasibility of title but he can charge the land
office for the breach of duty.

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