Questions and Answers Group B Tutorial Topic 1

1. The Land Laws of Malaysia are contained in four main pieces of legislation. Discuss. After going through some historical and political changes, there are now 4 main pieces of legislation governing land matters in Malaysia namely, the National Land Code (NLC) 1965 which is applicable to the whole of Peninsular Malaysia, the National Land Code (Penang and Malacca Titles) Act 1963 which is only applicable to Penang and Malacca, the Sarawak Land Code (Cap 81) and the Sabah Land Ordinance (Cap 68) applied in Sarawak and Sabah respectively. These 4 main pieces of legislation, except for Sabah Land Ordinance (Cap 68) provides the Torrens system of land registration title in Malaysia. Besides, all of these 4 legislations are not only making provisions for a system relating to registration of land but also for the law governing all the dealings and interests in land. Under this present system of land tenure, all lands alienated by the State are held under Torrens title, stated in NLC 1965 and Sarawak Land Code (Cap 81). Meanwhile, all land alienated by the State are held under non-Torrens title, provided in Sabah Land Ordinance (Cap 68). As for land held under previously English Deeds System in Penang and Malacca, provisions are now made under the NLC (Penang and Malacca Titles) Act 1963 for their conversion to current Torrens title along the lines of NLC 1965. As for land held under customary tenure in Peninsular Malaysia, its recognition will be continued under section 4(2)(a) of the NLC 1965 and sections 9499 of NLC (Penang and Malacca Titles) Act 1963. Whereas in Sabah and Sarawak, land held under native customary rights are governed by the Sarawak Land Code (Cap 81) and Sabah Land Ordinance (Cap 68) respectively. 1. The historical background of Malaysian land law started in 2. When Malacca handed over by Dutch to British via Anglo-Dutch Treaty in 1824, there was already an existing law during that time in Malacca which are, Dutch Grant, Islamic Law or Principles and Malay Customary Land Tenure. The principle of Malay Customary Land Tenure is all land belongs to the Ruler or Sovereign. The case of Sahrip v Mitchell & Anor (1970) highlighted the main point of MLCTs principle whereby although the sovereign was the owner of the soil any person who carried out the task of clearing waste land was entitled to occupy it provided he cultivated it and handed over one-tenth of the produce to the Sultan/Raja, however the said land will be forfeited to Sultan/Raja upon abandonment. There are 2 types of land under MCLT. Firstly, tanah hidup which consists of tanah kampong, tanah bendang, and tanah huma. Next is tanah mati which has no sign of appropriation and once cleared after abandoned.

There are few unique characteristics of MCLT. Firstly, the nature and ownership of land are not absolute since the land is actually owned by the Malay Sultan/Ruler whereas the citizens only enjoyed the usufructuary rights which is right to benefit or enjoy lands, crops, fruits belonging to others. Next, there was no restrictions or prohibitions to clear forest to convert tanah mati to tanah hidup. Plus, the occupation of the land secured by payment of one tenth of produce taken to the Sultan/Ruler. And lastly, the land will be forfeited to Sultan/Ruler upon abandonment within specified amount of time. There are 2 dealings under MCLT namely, jual janji and pulang belanja. 3. When Malacca handed over by Dutch to British via Anglo-Dutch Treaty in 1824, there was already an existing law during that time in Malacca which are, Dutch Grant, Islamic Law or Principles and Malay Customary Land Tenure. The basic principle of Malay Customary Land Tenure is all land belongs to the Ruler or Sovereign. The case of Sahrip v Mitchell & Anor (1970) highlighted the main point of MLCTs principle whereby although the sovereign was the owner of the soil any person who carried out the task of clearing waste land was entitled to occupy it provided he cultivated it and handed over one-tenth of the produce to the Sultan/Raja, however the said land will be forfeited to Sultan/Raja upon abandonment. There are few unique characteristics of MCLT which also has already been emphasized in the case of Sahrip v Mitchell & Anor. Firstly, the nature and ownership of land are not absolute since the land is actually owned by the Malay Sultan/Ruler whereas the citizens only enjoyed the usufructuary rights which is right to benefit or enjoy lands, crops, fruits belonging to others. Next, there was no restrictions or prohibitions to clear forest to convert tanah mati to tanah hidup. Plus, the occupation of the land secured by payment of one tenth of produce taken to the Sultan/Ruler. And lastly, the land will be forfeited to Sultan/Ruler upon abandonment within specified amount of time. 4. There are 2 dealings under MCLT namely, jual janji and pulang belanja. a. Jual janji (conditional sale) is one of dealing under MCLT. It is also a kind of Malay customary security transaction. In the jual janji transaction, the land occupier (borrower) borrows money from lender and the occupier will transfer the land to lender and lender promise to retransfers the land to occupier. Whatever profits the lender may make out of the land will be his to keep as a reward. The occupier must repay the same amount borrowed from the lender on agreed or stipulated time. Failure to do so on part of the occupier, the land will be transferred into the name of the lender, turning the original arrangement into an absolute sale, or janji putus. This has clearly been illustrated in Yaacob bin Lebai Jusoh whereby the court held that the fact that plaintiff remained in possession on the land b. Pulang belanja or return of expenses

2. Explain briefly the historical background of the Malaysian Land Law.

The Malaysian Land Law originated from the laws governing the Straits Settlements, Federated Malay States and the Unfederated Malay States. Penang was the first state subjected to the rule of the British when the Sultan of Kedah agreed to give the British rule of Penang in exchange for military assistance. It was discovered that Penang had no law of the land at the time, as seen in the case of Ong Cheng Neo v Yap Cheng Neo. Therefore, the British introduced the Royal Charter of Justice in 1807 to remedy the problem. The Royal Charter of Justice 1807 introduced the Deeds System, which was an old English system of landholdings. Its function was to record land transactions in the forms of deeds and indentures. However, since there was no proper registration of title of land and discrepancies in management of land, the Deeds System was phased out and replaced by the Torrens System. The British reinvaded Malacca in 1824, due to the Anglo Dutch Treaty of swapping Bengkahulu for Malacca to end the stalemate between the Dutch and the British. However, unlike Penang, Malacca already land laws governing the state. Among the laws existing were the Dutch Land Law, Islamic Land Law and Malay Customary Land Tenure. The Federated Malay States which consisted of Selangor, Pahang, Perak, and Negeri Sembilan, are independent states ruled under sovereign Muslim rulers. There were already pre-existing laws in the Federated Malay States such as the Perak Laws, Malay Digest, Kanun Laws and Rules for Disposal of Lands in Selangor. The Unfederated Malay States were made out of the five states which are Johor, Terengganu, Kelantan, Kedah and Perlis. They were mostly influenced by the Siamese King, so the British influence came later than the rest of Peninsular Malaysia. They collectively accepted the Torrens System late in the 19th Century. An example of the law is the Kedah Enactment 1934. The Land Code 1928 was later introduced to all states in Peninsular Malaysia. Its aim was to introduce a uniform system of Land Law and proper registration of title of land. It later developed into the National Land Code 1965. Both Land Code 1928 and National Land Code 1965 are only applicable to all states of Peninsular Malaysia, as seen in the case of Sime Bank v Mohd Hassan B. Sulaiman. As a conclusion, the Malaysian Land Law originated from various existing laws, such as Malay Customary Land Tenure, and laws introduced by the British, such as the Royal

Charter of Justice 1807, Deeds System, Torrens System and Land Code 1928, which were the foundation of the National Land Code 1965, the modern Malaysian Land Law.

3. What do you understand by Malay Customary Tenure?

Before the British took over the reign in Malacca from the Dutch after the AngloDutch Treaty 1824, Malacca already had their existing laws consisting of a blending the basic principles which stated that all land belongs to the Ruler or Sovereign and Islamic principles which stated that one who fells the tress own the land. According to the case of Sahrip v Mitchell & Anor, court held that it is well known that by the old Malay law or custom of Malacca, while the sovereign was the owner of the soil, everyman had nevertheless the right to clear and occupy all forest from Tanah Mati into Tanah Hidup. Tanah Hidup can be divided into three. First is Tanah Kampung where the land consists of fruit trees and as long it remains on the land, the occupation is secured. Second is Tanah Bendang where there is wet rice land and if more than 3 years the land was abandoned it will be forfeited. Lastly, Tanah Huma is the hilly land for cultivation which is use for shorter period. If more than 12 months no actions are taken to the land, it will be forfeited. Tanah Mati on the other hand mean once the land is cleared, later abandoned and there is no sign of appropriation. Besides that, wasteland was subject to the payment to the sovereign of one-tenth of the produce of the land so taken because nature and ownership of one is not absolute. Maxwells Theory highlighted that the traditional Malay, ruler owned the land while the citizens were left only with usufructuary rghts. The land are belongs to Sultan or raja under Malay Customary Land Tenure where it can be seen into two situations which are ampun kurnia/ cipta kurnia and system kerah. Ampun kurnia/ cipta kurnia means grant of land by sultan to some royal favourites of local chiefs. Whereas, sistem kerah means duty of peasants to render services to the Sultan. Lastly, the land will be forfeited upon abandonment for substantial period of time. There are three types of dealings under Malay Customary Land Tenure. First is jual janji (conditional sale). It is security transaction for the occupier borrows money from the lender. Occupier transfers the land to lender and lender promise to retransfers the land to occupier. Second is jual putus (absolute sale). If the occupier fail to repay or repurchase the land within the time stipulated/ fixed, the lender becomes the absolute owner. Third is pulang belanja. When the occupier wishes to sell the land, the price calculated is actually for the produce and buildings on the land whatever expenses incurred in opening, clearing, cultivating and developing the land not merely for the land itself. In conclusion, Malay Customary Tenure is applied before Torrens System is incorporated.

4. What the characteristics of the Malay customary land tenure as mentioned in the case of Sahrip v Mitchell & Anor?

Malay Customary Land Tenure was the land law existed in Malacca during the establishment of Malacca Sultanate and Islamic Religion during the 15th century. Based on the Islamic principles All land belong to the Ruler and One who fells the trees owns the land. The characteristics of Malay Customary Land Tenure were stated in the case of Sahrip v Mitchell & Anor, in which according to Maxwel C.J it is well known that by the old Malay Law or custom of Malacca, while the sovereign was the owner of the soil, every man had nevertheless the right to clear and occupy all forest and subjected to the payment to the sovereign of one-tenth of the produce of land so taken. Which means the land belongs to the Rulers and Sultan had the rights to grant land to some royal favourites of local chiefs or based on Sistem Kerah where there was a duty of peasants to render services to the Sultan. This was later supported by the Mazwells Theory where the traditional Malay ruler owned the land while the citizens were left only with a usufructuary right of enjoyment. So what are the characteristics of Malay Customary Land Tenure? So, according to the case given above (1) there is no absolute ownership but of a lesser extent proprietary rights rights of ownership not to the soil but to the usufruct/ rights to the enjoyment and utilise the land. (2) The method of acquisition of land is by opening up and cultivating virgin jungle or waste land (tanah mati into tanah hidup). (3) Maintaining the land under continuous cultivation. (4) Obligation to pay 1/10 to the Rulers as tax. (5) Do not abundant or neglected the land for a period of time such as 2 to 3 years as it will be forfeited back to the Rulers. (6) If there are wishes to sell the land, the price is based on pulang belanja and lastly, whoever wanted to borrow money on the security of land, it must be based on jual janji and if fails to settle the loan within the time given, it will be jual putus. Moreover, there were 2 types of land under Malay Customary Land Tenure, Tanah Hidup such as tanah kampong, tanah bendang and tanah huma, plus Tanah Mati in which a land that was being abandoned after a period of time. In the case of Yaacob bin Lebai Jusoh, plaintiff and defendant were on a land transaction agreement so; in 1945 they entered into an agreement where Plaintiff promised to pay the loan that he had borrowed from Defendant in exchanged of the land that he had transferred to Defendant in 1944 within 3 years. However, he failed to repurchase the land and the agreement became null and void thus, the court held that due to the wording held in the transfer was made in a security only therefore, the transaction was a jual janji. There were 3 types of dealing under the Malay Customary Land Tenure. Firstly, Jual Janji in which occupier borrow money from lender in exchanged of the occupiers land

and the lender promise to re-transferred the land once the occupier pay back the money within a stipulated time. Secondly, Jual Putus in which the occupier fail to repay or repurchase the land within the time given and lastly, Pulang Belanja where the occupier wants to sell the land, the price of the land is calculated from the building, the expenses incurred in opening, clearing, cultivation and developing of the land. In a conclusion, these are the characteristics of Malay Customary Land Tenure accordance to the case of Sahrip v Mitchell & Anor before it was abolished in the end of the 19th Century.

5. Explain briefly the following terms;

a) Jual janji (conditional sale) b) Pulang belanja (return of expenses) c) Jual putus (Absolute sale)

According to the case of Sahrip v Mitchell, Maxwell C.J held that by the old Malay law or custom of Malacca, while the sovereign was the owner of the land, the citizens on the other hand was left with the usufructuary right of enjoyment of the land which means the citizen has the right in opening and cultivating the land but subjected to pay one tenth of the produce of the taken land to the ruler. Because of such rights were given to the citizen, there were several dealings that had been used under Malay customary land tenure such as jual janji, pulang belanja and jual putus. Jual janji or conditional sale was more like a security transaction which the owner of the land wishes to borrow money on security of his land. This dealing was basically a sale transaction with a collateral agreement by the lender to sell back the land to the occupier upon the occupier paying back an identical price to the lender before stipulated time. However, if the occupier fails to do so, it can be said that the occupier had breach the contract of jual janji. Thus, the transaction of jual janji will become void and will turn into jual putus or absolute sale in which the lender will become the new absolute owner of the land. Both jual janji and jual putus transaction was best illustrated in the case of Yaacob bin Lebai Jusoh. In this case, the plaintiff applied an order to direct the defendant to transfer certain lands to plaintiff. First, in 1944, plaintiff sold his lands to the defendant in consideration of a sum of money. Then in 1945, plaintiff and the defendant made an agreement which the defendant would resell the lands to the plaintiff after payment of loan within 3 years commencing 1945. They also agreed that if the plaintiff failed to re-purchase within the 3 years, the agreement shall be null and void. Finally the court held that the fact that the plaintiff

remained in possession on the land even after he failed to repay to the defendant within 3 years makes the agreement becomes from jual janji to jual putus. Another dealings under Malay customary land tenure is pulang belanja or return of expenses. Under this dealing, if the owner wishes to sell his land, the price calculated would reflect the sum total of his labour and whatever expenses incurred in opening, clearing and cultivating the land and not merely for the land itself. As a conclusion, all land dealings held under Malay customary land tenure recognize by Sec 4 (2)(a) of the National Land Code 1965 nowadays but however still needs to be registered under the Torrent System of registration title of land.

6. Mark comes to you and he would like to know the type of land tenure that existed in Malacca at the time when the British re-occupied Malacca in 1824. Before the British reoccupied Malacca in 1824, it was the Dutch who occupied Malacca. The British reoccupation took place with the Anglo Dutch Treaty, where the Dutch marked the ending of their rivalry with British by handing over Malacca to the British in exchange of Bangkahulu. During the Dutch occupation from 1801 to 1807, the Dutch Grant was introduced as the law to manage lands in Malacca. Difference was made during British reoccupation, the land laws were switched to new systems called Malay Customary Tenure based on the Islamic Principles, English Deeds System and lastly the Torrens System, which is said to be the most effective Land Law. Unlike any other states in Peninsular Malaysia, Malacca does not have any reservation land, such land is known as the Melaka Customary Land (MCL), which was established under the Malacca Lands Customary Rights Ordinance of the Straits Settlement, and this was before it was abolished when National Land Code was enforced on the 1st January 1966. Under the Malay Customary Land Tenure, theres no registration required, you would enjoy the benefit from the land as long as you have paid 1/10 of rent to the ruler and not abandon the land: Sahrip v Mitchell. The ruler was the owner of all lands, the citizens only enjoyed usufructuary rights which means the rights to benefit from the land but not to own the land. Hence, there was no absolute ownership of land for the citizens. The Malacca Customary Land was to be subjected to the Naning Customs. The 2 types of Land under the MCLT were Tanah Hidup (consisting of Tanah Kampung, Tanah Bendang and Tanah Huma) and Tanah Mati which means the abandoned land. For Waste Land, one who fells the trees owns the land which was based on the Islamic principles.

The dealings available under MCLT were Jual Janji and Pulang Belanja. Jual Janji is where the occupier transfers the land to a person in order to borrow his money. The lender in turn promises to return the land only when the occupier repays the exact amount lent. On the other hand, Pulang Belanja is when the occupier wishes to sell the land including everything attached to the land in order to get cash. Later with the passing of second Charters of Justice in 1826, the Deeds System was introduced for a while in Malacca which later replaced by the Torrens System due to its defects. There was loss of papers relating to the ownership of lands. As a result, creating loss of revenue to the state as rent rolling was problematic. In conclusion, the types of land tenure during the preoccupation of British were the Malay Customary Tenure based on Islamic Principles and Deeds System, which later replaced with the most effective system called the Torrens System.

7. What were the important changes that were introduced by the British in the Malay States as to enable them to create a modern system of Land Tenure? FEDERATED MALAY STATES: Unlike Penang, which was ceded but which was subsequently regarded for all intents and purposes as a settled territory and Malacca which the British received through the Dutch-grant treaty between Dutch and the British in 1824, the FMS were independent States under sovereign Muslim rulers. In Tengku Jaafar & Anor v Govt of Pahang, Supreme court held that: The Land Law applicable in the state of Pahang 1889 was a Syariah or Islamic Law of Shafie School. Affirmed in Shaik Abdul Latif & Ors. v. Shaik Elias Bux, Edmonds J.C: Before the coming of British, the only law at that time applicable to the Malays was the Mohamedan Law modified by custom. In Selangor, Perak and Pahang merely based on Mohamedan law. Whereas in Negeri Sembilan there are special local customs based on matriarchy. UNFEDERATED MALAY STATES: The British influence said to come later in these States. The northern states of Kedah and Perlis were very much under the influence of the Siamese King and also included Kelantan and Terengganu. So the British gained possession of these four states pursuant to the Anglo-Siamese Treaty. TOWARDS THE TORREN SYSTEM: With the coming of the British administrators in FMS the rules of Malay Customary tenure soon being replaced with the Torrens System. Torrens System is a system whereby, the title to the land and the interests in the land depends upon registration and the instrument between the parties. In other words, the

TS is a system of land registration. This may be seen in the case of Sidek & 461 Ors. v. The Government of Perak in which the traditional method of acquisition of virgin land or waste land as permitted under the Malay Customary Tenure was abolished. The first Torrens Legislation enacted in FMS was the Selangor Registration of Titles Regulations of 1891, later became the model for the other three States i.e Perak and Pahang 1897 and Negeri Sembilan in 1898. Among other laws implemented in FMS after introduction of Torrens System are Land Enactment 1897, Land Enactment 1903-1911, Registration of Titles Enactment 1911 (FMS), FMS Land Code 1926 and later towards the implementation of National Land Code 1965. Whereas in UFMS, the Torrens System accepted later in the 19th century. Thus, Johor had its Land Enactment in 1910, Kedah Land Enactment 1909, Kelantan & Terengganu has their own respective Land Enactments of 1938. The purpose of introducing the Torrens System is to modify the MCLT which was actually the basic land law in the Malay States. So the Torrens System was designed by the British as to provide simplicity and certainty in the land dealings. Thus, all dealings in the land need to be registered to be effective. This is in which as according to Sec. 4 of the NLC 1965, registration is the key to title.