Funny! Why we ought to have some form of insurance protection for our land…but in Malaysia this is the real fact. With the growing number of land scams and increased value of property involved, serious measures, including protection by the law, are urgently needed to overcome the problem.
The direct result of the federal court’s decision in Adorna Properties Sdn Bhd vs Boonsom Booyanit is where a landowner can lose his land eventhough he holds a good title. Because this was a decision of the highest court in the country, it is binding on the lower courts……
The law is fine, but it is how the judges have interpreted it. If you were to read Court of Appeals decision, it appears that the Federal Court made its decision on the wrong premise. There was no reason for it to depart from the practice of differed indefeasibility – Dr. Sharifah Zubaidah Syed Abdul Kader (Public Law Department of International Islamic University Malaysia) in her statement on “Indefeasibility under the National Land Code 1965”
In the Adorna vs Boonsom case, it was about the interpretation of the law as laid out insection 340 of the National Land Code (NLC) 1965. Bonsom Boonyanit, a Thai national, owned some land in Penang. She eventually discovered that an impostor claiming to be her – and with supporting identification documents as well as statutory declarations had declared that she had lost the original title and managed to obtain a replacement title from the land office. This impostor subsequently sold the land to Adorna Properties, who bought it in good faith and did not suspect that there was anything amiss in the transaction.
When Boonsom sued for the return of the land at the Penang High court, she was unsuccessful. She appealed to the Court of Appeal, which decided in her favour. However, Adorna Properties then made an appeal to the Federal Court, and won. In essence Boonsom (who had since passed away) lost her land without receiving a single cent for it.
As Dr. Sharifah had put it, “The law now does not protect landowners, especially in cases of forgery; even if they are able to prove a good title, they can still lose their land. It is just so simple – the court will inevitably rule against them as long as it can be proven that the purchaser bought it in good faith. This Boonsom case had wreaked havoc on every landowner in this country – it not only puts a landowner at risk of losing his property to fraudsters and forgers, but also when the landowner loses his land to these crooks, he loses everything (including burning a HOLE to the title) ithout any compensation or remedy.
In a subsequent case of Au Meng Nam & Another vs Ung Yak Chew & Others where the Court of Appeal essentially did not follow the Boonsom’s case and reverted back the title to the original owners. When it was brought to the Federal Court for mention, this decision was reversed again! The recent NLC amendments in December 2007 also failed to deal with this critical issue!
While precautions can be taken by all parties concerned in any land transaction, this can never be fool-proof; the weaknesses (especially the national computerised land registration system) within the Land office cannot be discounted. For all the uncertainties surrounding land trasactions and ownerships, we believe it is timely if the insurance industry introduces what we called……….