LAW 504

LAND LAW I

DEALINGS

ISMAH BINTI ISMAIL

Faculty of Law
University Technology MARA

Ismah Ismail 1
INTRODUCTION
S. 5 – “Dealings” mean any transaction with respect to
alienated land effected under the powers conferred
under Division IV of the NLC.
It does not include any “Caveat” or “Prohibitory
Order”.
Caveat & P.O = restraint of dealings.

Ismah Ismail 2
DEALINGS
S.205(1)- dealings capable of being affected under the
NLC in respect of alienated land and interests therein
are those stated in Parts 14 – Part 17 and no others.

Hence, the four (4) types of dealings of any alienated

land recognized by the NLC are:
 Transfers;
 Leases and tenancies;
 Charges and liens ; and
 Easements.

However not all the above dealings require registration.

Ismah Ismail 3
Dealings … ctd
S.292(1) - Dealings that require registration are:-
 Transfers (including Certificate of Sale);
 Leases
 Charges; and
 Easements

Dealings that do not require registrations are:

 Tenancies; and
 Liens

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 DEALINGS
~TRANSFER~

Ismah Binti Ismail 5

TRANSFER
Who are the Parties to Transfer

S.205(2) - only those person/body mentioned in S.43

are entitled to enter into a dealings under the NLC.

Term used
Transferor – party who transfer the land;
Transferee- party who accepts the transfer.

Ismah Ismail 6
Transfer … ctd
What May Be Transferred? S.214

a) The whole, but not a part only, of any alienated

land;
b) The whole, but not a part only of any undivided
share, of any alienated land;
c) Any lease;
d) Any charge;
e) Tenancy exempt from registration

Ismah Ismail 7
Transfer … ctd
Peter Lai Kee Chin & Anor v Collector of Stamp
Duties (1973) 2 MLJ 33
Proprietor wished to transfer ½ of his share in the
land to the wife as a gift. He executed a transfer of the
whole of the land to himself and his wife in equal
undivided shares. Collector of Stamp Duties sought to
asses duty on the total value of the land.
Court : No contravention of S.214 when husband
transfer ½ share to his wife and the other ½ share to
himself.

Ismah Ismail 8
Transfer … ctd
Tan Chiw Thoo v Tee Kim Kuay
[1997] 1 CLJ 541 
Court : It has been the accepted conveyancing practice
among solicitors for many years and such practice has
been recognised and even adopted by the Courts, that
it would be lawful, that the 1st titleholder can execute a
transfer of the said lot to himself and to the 2nd
titleholder, each to take half undivided share of it in
one memorandum of transfer.

Ismah Ismail 9
Transfer … ctd
Tan Peng Huat & Anor v Tan Boon Chong & Anor
[2015] 2 CLJ 921  
Low and Tan purchased a portion of Lot 380 and each
of them held ½ undivided shares. Low sold her
undivided shares in the land to 1st and 2nd P as joint
owners. However, Low & Tan later sold all their share
in Lot 380 to 1st & 2nd D.
Court : The sale of Low’s whole, and not part, of her
undivided shares in the land to 1st & 2nd P was valid and
did not contravene S.214 of the NLC.

Ismah Ismail 10
Transfer … ctd
Limitations in Transfer

S.214(2) – power to transfer are subject to:-

 Other provision in NLC or any other written law;
 Restriction in interest;
 Consent from lessee or chargee (S.231(d) or
landlord;

Thus, if a transferor fails to comply with any of the

above, then the transfer cannot be registered.

Ismah Ismail 11
Transfer … ctd
S. 214A – Control of Transfer of Estate Land

S. 214A(1) - Estate land cannot be transferred, conveyed or

disposed of in any manner whatsoever unless approval is
obtained from the Estate Land Board
What is estate land ? – S. 214A(11)
o It is an agricultural land
o held under one or more title
o the area or aggregate area of land is more than 40 hectares
o the land constituting the area are contiguous/joining (ie-
the 40 hectares must be adjoining)

Ismah Ismail 12
Transfer … ctd
What is contiguous?
S. 214A(12) – land (either held under F.T or Q.T or a
combination thereof), is considered *contiguous
eventhough it is separated from each other only by
roads, railways or waterways.

Penalty – S.214A(10) & S.214A(10A)

*contiguous = bersempadanan

Ismah Ismail 13
Transfer … ctd
Why such restriction is imposed?

To prevent fragmentation of estate land without due

consideration being given to social and economic
consequences to the country.
Fragmentation of estate land often has the effect of
dislocating the labour force on estates.
[Beram Consolidated Rubber (1984) 1 MLJ 164]

Ismah Ismail 14
Transfer … ctd
S.214A(4) Form to be used
If the proprietor or co-proprietor wish to transfer,
he/they shall together with the person/ persons to
whom the land is to be transferred jointly submit an
application to the Secretary of the Estate Land Board
in Form 14D.

Ismah Ismail 15
Transfer … ctd
Kumpulan Sua Betong Sdn Bhd v Dataran Segar
Sdn Bhd (1992) 1 CLJ 150

Facts : A agreed to sell a piece of estate land to B. B

nominate C so that the land could be transferred from
A to C. PP was to be paid upon presentation of the
transfer for registration. PP was paid and the transfer
was presented for registration. Six years later, A
objected to the transfer on the ground that no
approval from Estate Land Board was obtained, hence,
the transfer is null and void.

Ismah Ismail 16
Transfer … ctd
Court : S. 214A is couched in mandatory terms, non-
compliance with which would be fatal to the transfer.
If it can be proved by evidence that the land is a
portion of the Lukut Estate, then the transfer of the
land constitutes an offence under s. 214A(10A)(a).

Ismah Ismail 17
Transfer … ctd
 Kumpulan Sua Betong Sdn Bhd v Ezan Sdn Bhd & Anor
(1993) 3 CLJ 337

Court :

The requirement of the approval of the Estate Land Board was to

be found in sub-section (4) of s. 214A which in clear, plain words
stipulates that the application for approval is required only where
the transfer, conveyance or disposal in any manner whatsoever of
the estate land is made to two or more persons.
Where an estate land or a portion of an estate land is to be
transferred to one person, as in this case, the Estate Land
Board's approval was not required.
Ismah Ismail 18
Transfer … ctd
These two cases were decided prior to the
amendments made to S.214A in 2001.
B’4 amendment – restriction is imposed if
transfer of Estate Land is to be made to two or
more person
After amendment – any attempt to transfer
Estate Land is subject to an approval from Estate
Land Board (irrespective of whether the transfer is
to be made to one or two or more person).

Ismah Ismail 19
Transfer … ctd
Qn – Does SPA entered into between the parties for the sale
of an estate land without first obtaining approval from ELB
considered as invalid?

Yakin Tenggara Sdn Bhd v RHB Bank Bhd & Ors

(2017) 4 CLJ 738
Faithmount and Gula Perak entered into SPA for the sale of
estate land but no approval from ELB was obtained.
CA : it will be against the spirit and policy consideration
behind s. 214A(1) of the National Land Code ('the NLC') to
allow estate landowners to execute SPA without first
obtaining the approval of the Land Board. Such contract of
sale is void from the beginning if no approval from the ELB
had first been obtained prior to the execution of the SPA.

Ismah Ismail 20
Transfer … ctd
*Gula Perak Bhd v Datuk Lim Sue Beng & Other
Appeals [2019] 1 CLJ 153

*An appeal made from the decision of Court of Appeal

in the case of Yakin Tenggara Sdn Bhd v RHB Bank Bhd
Issue : Whether a conditional agreement to sell an
estate land (‘SPA’) to a purchaser with a condition
precedent that the sale was subject to obtaining the
approval of the Estate Land Board was in breach of
S.214A of NLC when no prior approval was obtained
from the Land Board before entering into the SPA.

Ismah Ismail 21
Transfer … ctd
Gula Perak Bhd
FC : S.214A(1) of the NLC does not prohibit the
making of a conditional or contingent agreement to
sell an estate land which has an express term
incorporated in that the intended sale is subject to the
parties obtaining the approval of the Board. The
prohibition under the said section is merely against an
act of transfer, conveyance or disposal of estate land
without the approval of the Board. The SPA being a
conditional or contingent agreement is therefore not
illegal for non-compliance with the provisions of the
said section.

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PROCESS & PROCEDURE OF TRANSFER
a. S. 206(1)(a) & S.207 – every dealing shall be
effected in a proper instrument (forms)

b. S. 215(1) – the relevant instrument for transfer of

any alienated land is Form 14A

c. S. 206(1)(b) – no instrument shall be effective to

operate as a transfer of a title until it is registered.

d. S. 215(2) – upon registration, the title of transferor

in the land shall pass and vest in the transferee.
Ismah Ismail 23
Process & Procedure … ctd
e. S. 304(1) – registration of any instrument shall be
effected by the Registrar.

f. S. 304(2) – the Registrar shall register the transfer by

making a memorial on the RDT, signs and seals on
the instrument.

Jasbir Kaur (1974) 1 MLJ 224

“It is the official act of registration and of the
execution and delivery of the dealing/instrument
which creates or assigns the estate”

Ismah Ismail 24
Process & Procedure … ctd
g. S. 215(3) – upon registration, the transferee shall
take over
Lease, charge or other registered interest
existing at the time of registration of transfer, if
any;
Tenancy exempt from registration, if any and
endorsed;
Whatever matters appear in the register
document of title.

Ismah Ismail 25
Process & Procedure … ctd
Qn – When does registration of a title take effect?

Mohamad Buyong v Pemungut Hasil Tanah

Gombak
Court : an entry made on the register was only a bare
entry and it was never signed by the Collector. Any
memorial made without the registering authority
signing and sealing it, there would be no registration -
(S.304(1) and (2))

Ismah Ismail 26
Process & Procedure … ctd
Qn - What is the position of parties under contract of
sale pending registration of transfer ?

Ong Chat Pang (1971) 1 MLJ 224

Pending registration of transfer and upon payment of
full purchase price, the transferor shall become a bare
trustee for the transferee (purchaser). Transferee’s
entitlement is only as beneficial owner of the land.

“Bare trustee = a person who holds property in trust for

the benefit of another.
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 DEALINGS
~LEASE~

Ismah Binti Ismail 28

LEASE
A person who leases the land is called a lessor
while the person who accepts the lease is called the
lessee.
Lease is one of the dealings which is capable of
being registered.
By virtue of sec. 5 - “lease” simply means “ a
registered lease or sublease of an alienated land”.
Thus, lease must be registered to be effective.

Ismah Ismail 29
Lease … ctd
Once registered, a lease creates a legal interest in
the land

- enforceable against third party

- enjoys protection within the terms of
legislation

Ismah Ismail 30
Lease … ctd
Lease Under Common Law

Need not be registered

Legal interest created upon signing of agreement

Ismah Ismail 31
Lease … ctd
Elements of Lease Under Common Law

a) Lessee has an exclusive possession

 lessee can exclude all person including the
lessor.
 lessor will not deprive lessee of enjoyment of
the land
b) Lease is of a definite period; and
c) In consideration of payment of rent

Ismah Ismail 32
Lease … ctd
Power to Lease under NLC
S. 221(1) – proprietor of any alienated land can
grant a lease
o Wholly; or
o partly

Ismah Ismail 33
Lease … ctd
Term of Lease

S. 221(2) every lease must be for a term exceeding 3

years.
Maximum term to grant lease – S. 221(3)
a. lease of the whole piece of land – 99 years.
b. Lease of part the land – 30 years.

Ismah Ismail 34
Lease … ctd
Power of lessee to sub-lease

S. 222 – lessee or sublessee are entitled to further sub-

lease the whole or any part of the land to another party –
but must comply with the requirements under subsection
(2)-(4), ie-
 For a term exceeding 3 years
 If sublease only part of the land – cannot exceed 30 years
 Form to be used is F.15B. Plan and description to identify
the sublease must be attached if the lease is in respect of
part of the land.

Ismah Ismail 35
Lease … ctd
 Lease and its limitation

a. S. 225(1) may be subject to

o limitation impose under the NLC or any other
written law;
o restriction in interest.
b. S. 225(2)- lease cannot be granted to 2 or more
persons or bodies otherwise than as trustees or
representative.
c. S. 226 – consent from lessee or chargee be
obtained before leased can be created.
Ismah Ismail 36
Lease … ctd
Instrument of Lease
o S. 221(4) - Every lease shall be in Form 15A

Effect of Registration of Lease

o S.227(1) – Interest of lessee shall vest in him upon
registration of lease

Ismah Ismail 37
Lease … ctd
What if Lease is not registered?

General rule – S. 206(1)(b) – no instrument of dealing shall

operate to effect any interest unless it is registered.

S. 206(3) – however the requirement in S.206(1) shall not

affect any contractual operation of any transaction of
alienated land.

Even though the instrument is not registered, the contract to

lease entered between the lessor and lessee is still valid.
Ismah Ismail 38
Lease … ctd

Thus, unregistered lease is void as a lease but the

contract is valid as an agreement for a lease.

The contract is enforceable under the law of

contract.

Ismah Ismail 39
Lease … ctd
Margaret Chua v Ho Swee Kiew & Ors
(1961) 1 MLJ 173

Court : Although an agreement might be a nullity

as a lease due to lack of registration, it was valid as
an agreement for a lease enforceable in equity.

Ismah Ismail 40
Lease … ctd
Ong Heng Hwa Realty Sdn Bhd v Teoh Chai Siok
(1977) 1 MLJ 124

Fact : there was an agreement for a forty year lease

where the lessee was in possession and paying the
rent, but the lease was not registered.
Court : Affirmed the decision in Margaret Chua.
Court held that the lessee is entitled to rely on the
equitable relief of specific performance as
provided in the agreement.
Ismah Ismail 41
Lease … ctd
Pembinaan Eastern Aluminium Sdn Bd v Narita
Shipping & Transport Sdn Bhd (2014) 4 MLJ 534
Parties entered in to a lease agreement. Individual title to
the property has yet to be issued. P paid the deposit and
took possession of the property. Later, P decided to
terminate the agreement and took action for the refund of
the deposit. P claimed that the agreement was void under
the NLC as lease cannot be created without title to the
land.
Court : A lease is void for non-registration under the NLC,
even though an agreement might be a nullity as a lease, yet
an agreement could be a good and valid enforceable
agreement to grant a lease.
Ismah Ismail 42
Lease … ctd
Badan Pengurusan Tiara Duta v Timeout Resources
Sdn Bhd (2015) 1 MLJ 110
 One of the issues raised before the court was in respect of
the effect of an agreement not being a registered lease
Court : A lease will only have legal effect upon the
registration of an instrument in Form 15A of the NLC. An
unregistered lease, although void as a lease and will not
have the effect of vesting an interest in the lessee, is still
good and valid as an agreement for a lease and is
enforceable in equity by a decree of specific performance.
*Court made reference to the case of Margaret Chua.

Ismah Ismail 43
 THANK YOU
FOR YOUR ATTENTION

Ismah Ismail 44