MWKA

 Public  Series    
Lunch  Talks  
 
Land  Acquisi=on,  Compensa=on  and  Disputes  
 
 
 
 
 
 
Raymond  Mah  
Managing  Partner  
27  August  2013  
 

www.mahwengkwai.com  
 Defini=on    
 

“Land  Acquisi3on”  means  the  acquiring  of  land  

for   some   public   purpose   by   government/
government   agency,   as   authorised   by   the   law,  
from  the  individual  landowner(s)  aOer  paying  a  
government   fixed   compensa=on   in   lieu   of  
losses   incurred   by   land   owner(s)   due   to  
surrendering  of  his/their  land  to  the  concerned  
government  agency.  
 
 
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 What  is  Compulsory  Land  Acquisi=on?  
 
•  A  form  of  governmental  interven=on.    

•  The  dispossession  and  evic=on  of  private  

property  owners  from  their  proper=es.    
 
 

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 Land  Ownership  in  Malaysia  
3  routes  to  ownership:  
 
•  dealings    
•  inheritance    
•  aliena3on  
 
The  rights  of  property  owners  in  Peninsular  Malaysia  are  governed  by  the  
following  legisla=ons:  
 
•  Federal  Cons3tu3on  
•  Na3onal  Land  Code  1965  
•  Land  Acquisi3on  Act  1960  
 
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 Land  Ownership  in  Malaysia  
2  types  of  land  ownership:  
•  Land  held  in  perpetuity  (freehold  land);  and  
•  Land  held  for  a  term  of  years  (leasehold  land  –  maximum  99  years).  
 
Land  ownership  and  du=es:  
•  Paying  the  annual  quit  rent  
•  Express  and  implied  condi=ons  
Ø   agricultural  land  
Ø   building  land  
Ø   industrial  land  

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 Indefeasibility  of  Title  
•  Ownership  cannot  be  “challenged  or  ques=oned”    
 
•  Sec=on  340(2)  NLC  
•  Excep=ons:  
Ø fraud  
Ø Misrepresenta=on  
Ø Void  or  insufficient  instrument  

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 Par==on  and  Amalgama=on  
Par==on    
•  Sever  joint  interests  and  take  individual  share.  
•  Voluntary  or  compulsory.  
 
Amalgama=on  
•  Combine  one  or  more  allotments  of  land  together.    
•  Reduce  rates  and  taxes.    

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 Squacers  
 
•  Occupying  somebody’s  land  without  permission    
•  No  macer  how  long  illegal  occupa=on    
•  Tort  of  trespass    
•  Liable  in  damages  
•  Squacers  on  state  land  
Ø Temporary  occupa=on  licences  (TOLs)  
Ø Land  =tles  

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 Federal  Cons=tu=on  

Ar3cle  13  of  the  FC  provides:    

•  13(1)  –  No  person  shall  be  deprived  of  property  save  
in  accordance  with  law  
•  13(2)  –  No  law  shall  provide  for  the  compulsory  use  
or  acquisi=on  of  property  without  adequate  
compensa=on  

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 Land  Acquisi=on  Act  1960  
Purpose  and  func=on  
 
Ø rela=ng  to  the  acquisi=on  of  land  
Ø to  make  an  assessment  of  compensa=on  due  to  such  
acquisi=on  
Ø to  govern  the  procedures  involved  
 

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 Who  can  Compulsorily  Acquire?  
LAA  1960  and  the  NLC  1965  empower:  
 
•  State  Governments  without  prior  consent  or  
agreement  
 

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When  is  it  Allowed?  
 
Sec=on  3(1)  LAA  1960  provides  that  the  State  Authority  may  
acquire  any  land  which  is  needed  :  
 
•  for  any  public  purpose;  
•  by  any  person  or  corpora=on  for  any  purpose  which  in  the  
opinion  of  the  State  Authority  is  beneficial  to  the  economic  
development  of  Malaysia  or  any  part  thereof,  or  to  the  public  
generally  or  any  class  of  the  public;  or  
•  for  the  purpose  of  mining  or  for  residen=al,  agricultural,  
commercial,  industrial  or  recrea=onal  purposes  or  any  
combina=on  of  such  purposes.  

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 Land  Acquisi=on  Process  (1)  
Form  F  (Sec=on  11)  -­‐  
Form  A  -­‐  Land  is  likely  
No=ce  to  Persons  
to  be  acquired    
Interested    

Form  B  (Sec=on  5)  -­‐  

Form  E  (Sec=on  10)  -­‐  
Entered  and  
No=ce  of  enquiry  
Surveyed    

Form  D  (Sec=on  8)  -­‐

Form  C  (Sec=on  7)  -­‐  
Acquisi=on  of  
Plans  &  No=fica=on  
scheduled  land    

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 Land  Acquisi=on  Process  (2)  
(Sec=on  12)  -­‐  Enquiry  
Form  K  (Sec=on  22)  -­‐  
before  Land  
Take  possession  
Administrator  

Form  G  (Sec=on  14)  –     Form  J  (Sec=on  20)  –    

Declara=on  of   Occupants  and  owners  
intended  acquisi=on     to  vacate  buildings  

Form  H  (Sec=on  16)  –     Form  I  (Sec=on  19)  –    

Service  of  wricen   Take  possession  in  
award   urgent  cases  

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 Land  Acquisi=on  Process  (3)  

Form  L  (Sec=on  24)  -­‐   Form  O  (Sec=on  38(5)  -­‐  

Demand  delivery  of  =tle   Refer  objec=on  to  High  
document   Court    

(Sec=on  37)  -­‐  6  weeks  from   (Sec=on  38(1)  -­‐  Object  to  
date  of  award    (Sec=on  14)   the    compensa=on  
Object  to  compensa=on   awarded  (Form  N)  to  the  
amount   Land  Administrator’s  Office  

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 What  should  you  do?  

 
Get  a  
Lawyer   Get  a  Valuer  

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 Challenge  the  State  Government’s  
decision?  

•  Judicial  Review    
•  Decision  is  in  Form  D  (Declara=on  of  Inten=on)  
•  Failure  to  follow  procedures  in  LAA  1960  
•  Not  for  purpose  stated  in  Sec=on  3  LAA  1960    
•  Bad  faith  

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Who  should  be  Compensated?  
 
•  Sec=on  2  LAA  1960    
Ø every  person  claiming  an  interest  in  compensa=on  to  
be  made  on  account  of  the  acquisi=on  of  land;  

•  freeholder,  leaseholder/tenant,  chargee,  business  

occupier,  easement-­‐holder,  op=on-­‐holder,  trustee  
and  beneficiary,  beneficial  owner  and  others.  
 

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 Form  N  –  Applica=on  to  Court  
•  Objec=ons:  

Ø The  measurement  of  Land  

Ø The  amount  of  the  compensa=on  
Ø The  persons  to  whom  it  is  payable  
Ø The  appor=onment  of  the  compensa=on  

 
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 Court  Hearing  Process  

Record  of   Role  of  

Cross-­‐
Appeal   the  2  
examina=on  
(Form  O)   assessors  

Exchange  of  
Valua=on  &   Role  of   Submissions    
Rebucal   Judge  
Reports  

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 How  is  compensa=on  assessed?  
•  Based  on  the  Market  Value  
•  Compensa=on  for  the  Land  taken  
•  Compensa=on  for  other  losses  suffered  in  
consequence  

Rickets  v  Metropolitan  Rail  Co  –  “compensa=on  is  the  

amount  required  to  put  the  dispossessed  landowner  in  
the  same  posi=on  as  if  his  property  had  not  been  
acquired”.  

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 Market  Value  
•  Willing  buyer  and  willing  seller  
•  Comparison  with  recent  sales  
•  Similar  characteris=cs  
•  Within  2  years  
•  Valua=on  report  with  reasons  and  calcula=ons  

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 Compara=ve  Method  
•  Loca=on  and  surroundings  
•  Size  and  shape  
•  Road  frontage  and  access  
•  U=li=es  –  electricity  and  water  
•  Date  of  acquisi=on  
•  Freehold/Leasehold  
•  Category  of  land  use  
•  Restric=ons  
•  Local  authority  zoning  
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 Poten=al  Development  

•  Requires  proper  evidence  

•  Burden  on  owners  
•  Surrounding  development  
•  Building  plans  

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 Other  Losses  
•  Injuries  affec=on  
•  Severance  
•  Loss  of  rental  
•  Cost  of  building  
•  Expenses  

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 Decision  Making  Process  

•  Compensa=on  decided  by  2  assessors  

•  If  2  assessors  differ,  Judge  shall  choose  
•  Benefit  of  doubt  should  be  given  to  the  land  
owner  

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 Appeals  
•  Against  decision  on  ques=on  of  law  
•  Against  decision  of  compensa=on  
•  S40(D)(3)  LAA  
•  S49(1)  LAA  
•  Estate  of  Tan  Bok  Yin  v  PTD  (2013)  
•  Cons=tu=onal  right  of  appeal  

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 Conclusion    
Work closely
with your
lawyer and
valuer to
achieve the
best possible
outcome.

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 Ques=ons?  

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