Land law 1 alienation 2014

1. DISPOSAL BY ALIENATION [email protected]

2. Power of State Authority to dispose of State Land by alienation Section 41 State Authority has the power to dispose of and the power to take back state land Section 42 One method by which the State Authority may dispose of land is by alienation . (Note: methods of disposal other than alienation include reservation, TOL, permits –see Section 42).

3. Meaning of alienation Section 5 " alienate" means to dispose of State land in perpetuity or for a term of years , in consideration of the payment of rent , and otherwise in accordance with the provisions of section 76 …

4. Section 76 Meaning of alienation. The alienation of State land under this Act shall consist of its disposal by the State Authority- (a) for a term not exceeding ninety-nine years ; ( aa ) in perpetuity - (b) in consideration of the payment of an annual rent ; (c) in consideration of the payment of a premium ; (d) subject to a category of land use ; and (e) subject to such conditions and restrictions in interest as may be imposed by the State Authority.

5. Why is alienation the best way to get land? The proprietor gets land evidenced by title The period is longer than the other modes of disposal If the land is later on acquired by the State Authority for public purposes, the proprietor will get compensation Proprietor can make dealings with regard to the land

6. Period of alienation Section 76 “The alienation of State land under this Act shall consist of its disposal by the State Authority- (a) for a term not exceeding ninety-nine years ; ( aa ) in perpetuity -…”

7. After the 1985 amendments: S 76 (a) not more than 99 years  State lease (leasehold land) S 76 ( aa ) in perpetuity (999 years)  (freehold land) Only applicable to: land alienated to the federal government or public authority If used for public purposes If state authority is satisfied that there are special circumstances which render it appropriate to do so

8. Seven matters to be determined upon approving alienation Section 79 (2 ) Area approved Period of alienation Form of Final Title Rate to calculate rent Premium Category of land use Express conditions and restrictions in interest

9. Conditions and restrictions in interest

10. Section 120: Imposition of conditions and restrictions in interest ( 1) Subject to the provisions of this section, the State Authority may alienate land under this Act subject to such express conditions and restrictions in interest conformable to law as it may think fit. (2) The conditions and restrictions in interest to be imposed under this section in the case of any land shall be determined by the State Authority at the time when the land is approved for alienation . (3) Every condition or restriction in interest imposed under this section shall be endorsed on or referred to in the document of title to the land; and in complying with this sub-section the State Authority shall, in any case where it imposes both conditions and restrictions in interest , distinguish between the two.

11. Conditions Imposition by the State Authority of obligations relating to the use of land for agricultural, building and industrial purposes. Section 5: "condition" does not include any restriction in interest 2 types of conditions: Express conditions Implied conditions

12. Express & Implied Conditions Express conditions Section 120 Endorsed on the document of title (clearly spelled out in the title) Applies specifically to that particular land Implied conditions Sections 114-118 Relate to the category of land use that the land is subject to (Conditions that have been laid down in the NLC) Only to the extent that it is not inconsistent with express conditions

13. Examples of Express Conditions “This land may only be used to plant rubber trees” “This land is to be used as a residence only” “This land is to be used for the purpose of a petrol station” And this is clearly stated or ENDORSED on the document of title.

14. Examples of Implied Conditions Section 114 – Relating to boundary marks Sections 115 – Relates to the category of land use See: Agriculture – Sections 115 and 121 Building – Sections 116 and 122 Industry – Sections 117 and 122 Example: for agricultural land, only buildings for the purpose of agriculture can be erected on the land. (Section 115) Example: agricultural land under QT, only a temporary building can be erected.

15. Effect of breach of condition Section 127 The land will be liable to fortfeiture

16. Restrictions in Interest Section 5: “any limitation imposed by SA on any of the powers conferred on a proprietor by Part Nine, or on any of his powers of dealing under Division IV …” [Note : Part Nine: Subdivision, partition, amalgamation Division IV: Dealings]

17. In other words, a restriction in interest restricts the power of the registered proprietor to deal with his land. [ Note : S5 “condition” does not include any restriction in interest ] Section 120: SA may impose restriction in interest.

18. Examples Examples of general restrictions in interest: Leasehold land  must get approval of State Authority before dealing with leasehold land. Malay Reserve Land  can only be transferred to a Malay.

19. Specific restrictions in interest can be found in the document of title. “This land cannot be transferred within 10 years from the date of registration.” “This land may not be subdivided, partitioned or amalgamated without the express approval of the State Authority”.

20. Effect of breach of restriction in interest The dealing will not be fit for registration. Even if registered, the dealing will NOT be indefeasible. Case: UMBC v Syarikat Perumahan Luas [1988]

21. UMBC v Syarikat Perumahan Luas [1988] There was a restriction in interest prohibiting the charge of the land without the written sanction of the State Authority. A charge was registered in breach of an express restriction in interest. Court: The interest of the chargee is defeasible . Registration of the charge was obtained by means of an insufficient or void instrument. The Registrar had acted ultra vires.

22. Category of land use

23. Category of land use 3 categories: agriculture, building, industry – S 52 Endorsed on document of title (Note: before the 1985 amendments, there were 4 categories; agriculture, commercial, residential, industry) “NIL” or “No category” --. Land not subject to a category of land use. (SA will normally attach conditions).

24. ‘Conversion ’  may convert from one category to another E.g. from ‘agriculture’ to ‘building ’ Section 124: Power of State Authority to vary conditions etc. Proprietor may apply to State Authority for the alteration of any category of land use.

25. Items of land revenue

26. Items of land revenue Section 81(1) Payable upon approval of alienation First year’s rent Premium Survey fees Fees for preparation of title

27. Effect of non-payment Land Administrator will send notice in Form 5A to the intended proprietor that land revenue is due. Effect of non-payment? Section 81(2): The approval of alienation will lapse . However, see the case of Teh Bee v K Maruthamutu .

28. Effective date of alienation

29. What is the effective date of alienation? Section 78(3): “The alienation of State land shall take effect upon the registration of a register document of title thereto … and, notwithstanding that its alienation has been approved by the State Authority, the land shall remain State land until that time .”

30. Alienation takes effect upon registration of a register document of title, and not upon approval of the State Authority. The land shall remain state land until registration.

31. Dr Ti Teow Siew v Pendaftar Geran-Geran Tanah Selangor [1982] 1 MLJ 37 Justice Hashim Yeop Sani : “Section 78(3) of the Code determines when an alienation of state land shall take effect and it is clear from that subsection that alienation takes effect upon registration ”.

32. L and had been alienated to the first applicant, the title being endorsed with the following endorsement of restriction in interest — "The land hereby leased shall not be transferred or leased for a period of fifteen years without the consent of the Ruler in Council." The title also contained particulars stating  inter alia  that the title commenced from August 18, 1964. The alienation of the land was registered after full payment of premium and other fees on November 9, 1967. The first applicant transferred the land to the 2nd and 3rd applicants on May 5, 1980 and the 2nd and 3rd applicants also executed a charge in favour of the 4th applicant on the same day. He memorandum of transfer and charge were presented for registration but were rejected by the respondent on the ground that the restriction in interest was still subsisting.

33. The question was whether the restriction in interest commenced from the date endorsed on the title, that is August 18, 1964 or the date when the alienation was registered that is on November 9, 1967 . The applicants applied to set aside the decision of the respondent in refusing to accept the documents for registration and for a declaration that the restriction in interest endorsed on the document of title expired on August 17, 1979.

34. Held : the restriction in interest commenced from the date of registration of the register document of title , that is, November 9, 1967, and the respondent was therefore correct in rejecting the documents presented for registration.

35. Types of titles

36. Types of titles Final Title Qualified Title Registry Title Land Office Title

37. Qualified Title & Final Title SS 176 and 77 Section 176: Purposes and effect of qualified title. (1) The purposes of qualified title are- (a) to enable land to be alienated in advance of survey; (b) to enable title to be issued in advance of survey.

38. (2) Qualified title shall confer on the proprietor the like rights in every respect as those conferred by final title, save that- (a) the boundaries of the land shown on the document of title thereto shall be provisional only, and (b) the land shall not be capable of being sub-divided, partitioned or included in any amalgamation. (3) qualified title may be converted into final title.

39. Section 77: Titles under which land may be alienated. (1) The titles under which State land may be alienated under this Act are- (a) Registry title and Land Office title (being forms of final title), and (b) qualified title. (2) Land may be alienated under qualified title at any time after its alienation has been approved by the State Authority, but may not be alienated under either of the forms of final title aforesaid unless it has been surveyed.

40. Registry Title & Land Office Title Registry Title Section 5: title evidenced by a grant or a State lease, or by any document of title registered in a Registry under the provisions of any previous law Section 77(3) – Town/village land, country land exceeding 4 hectares, foreshore & seabed Within admin of Registry Office

41. Land Office Title Section 5: title evidenced by a Mukim grant or Mukim lease, or by any document of title registered in a Land Office under the provisions of any previous law. Section 77(3): country land not exceeding 4 hectares Within admin of Land Office

42. Tutorial Questions

43. Question 1 Kumpulan Talam owns a piece of 20 acres of land in Ulu Bernam . When they received the title from the land office they discovered a statement in one of the columns in the land title stating that the land is an agricultural land and for planting palm oil only. Being a company that deals mainly with real estate and housing, Talam intends to develop the land to become a new halal hub for agricultural products. Unfortunately when Allan, the project manager visited the site, he found out that there are 30 families of villagers occupying the land with various activities and building structures built on the land. To make thing worst, they claimed that they occupied the land for 30 years and permission was obtained from the land office. Allan seeks your advice on how to proceed with Talam’s plans to develop the land and how to deal with the existing occupiers on the land. The occupiers also argued that Kumpulan Talam has no legal right to evict them as the company failed to pay premium to the Gombak land office on time. Advise Allan .

44. Question 2 Discuss the extent of powers of the State Authority with respect to disposal of land by way of alienation. (6 marks)