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2022 MarsdenLR 2964
COURT OF APPEAL PUTRAJAYA
PUJAAN PERTAMA SDN BHD – Appellant
Versus
YAP LEE CHUAN & ORS – Respondent
[Civil Appeal No: N-01(NCVC)(W)-408-07/2021]
Establishing that a subsequent land transaction validity relies on the prior owner's legitimacy; immediate purchasers may retain title only if proven bona fide and for value without prior fraud.
Headnote:(A) National Land Code 1965 – Section 340(2) and (3) – Appeals against finding of fact regarding alleged forgery of land transfer documents and the bona fides of purchase – The appeal was dismissed as the appellant was an immediate purchaser and did not acquire an indefeasible title due to the fraud established against the prior vendor. (Paras 12, 14, 29)
(B)
Forgery – The finding that the transfer of land was effected by forged documents, based on credible testimonies and handwriting expert opinions, was upheld by the court, confirming that the plaintiffs had not executed the transfer documents. (Paras 16, 21)
(C)
Burden of Proof – The court clarified that once fraud was established against an immediate vendor, the subsequent purchaser cannot acquire legitimation regardless of payment or lack of notice. (Paras 30, 38)
Facts of the case:
The plaintiffs, registered owners of a land parcel, discovered it was fraudulently transferred to a subsequent purchaser without their knowledge. The plaintiffs never executed the transfer documents.
Findings of Court:
The testimonies regarding the authenticity of signatures were reliable, and the transfer was conclusively found to involve fraud.
Issues
: The main issues were whether the initial land transfer was fraudulent and whether the appellant acted in good faith.
Ratio Decidendi:
The trial judge's finding of forgery was upheld, and the appellant was deemed an immediate purchaser with no indefeasible title because of clear fraud.
Result:
Appeal dismissed with costs.
JUDGMENT
Introduction
[1] The appellant in this case, Pujaan Pertama Sdn Bhd, was a purchaser of a piece of land previously registered in the name of the respondents, the Yap brothers. The Yap brothers were the plaintiffs in the court below.
[2] The plaintiffs had sued the appellant, another company by the name of Fu Zhi Mao Group Sdn Bhd (which was the second defendant in the original action), the Port Dickson Land Administrator and its District Officer and the Director for Land and Mines (the third to fifth defendants respectively) and an advocate and solicitor by the name of Norizah binti Ramli (the sixth defendant). The suit was for (among others) the recovery of the piece of land.
[3] After a trial of the action, the High court allowed the plaintiff's claim against Pujaan Pertama, Fu Zhi Mao and the Director for Land and Mines, and directed that the land be re-registered in the name of the plaintiffs.
[4] Pujaan Pertama appealed against this decision. We unanimously dismissed its appeal, for the reasons set out here. This is the judgment of the court.
Material Background Facts
[5] The plaintiffs were the registered proprietors of a piece of land measuring some 6 acres located in the mukim of Jimah, on which land was planted oil palm. On or about 2 June 2017, the plaintiffs were informed that the land was no longer registered in their names, despite the fact that they had never sold the land and that the issue document of title for the land remained in their possession.
[6] Subsequent searches conducted with the land office revealed that the land had first been transferred by persons purporting to be the plaintiffs to Fu Zhi Mao, the second defendant in the court below, sometime in August 2016. The consideration for this transfer was recorded in the relevant Form 14A as RM1 million. The Form 14A by which the land was conveyed to Fu Zhi Mao by the plaintiffs bore a signature purporting to be that of a solicitor, Norizah binti Ramli, who was the sixth defendant in the original action.
[7] Fu Zhi Mao then sold the land for RM400,000 to Pujaan Pertama, the appellant before us. This was documented in a sale and purchase agreement dated 15 November 2016. Pujaan Pertama became the registered proprietor on 23 January 2017.
[8] The transactions affecting the land are depicted in the following diagram:
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At The High court
[9] At trial, Norizah denied having attested the signatures of the plaintiffs on the Form 14A that documented the first transfer to Fu Zhi Mao, and testified that the signature in the attestation clause on the Form 14A was not hers. Furthermore, the stamp affixed to the Form 14A bore the name of the firm Khairuddin Lina Leong & Co, which she had left some four years prior to the date on which the Form 14A was executed. Forensic examination of the signature also confirmed that it did not belong to Norizah.
[10] The handwriting expert from the Department of Chemistry who examined the signatures of the plaintiffs was of the view that the signature purporting to be that of the second plaintiff on the Form 14 dated 11 July 2016 was probably not written by the second plaintiff. As regards the signatures purporting to be those of the other plaintiffs, the expert found that "it was not possible to carry out a suitable comparison of the handwriting characteristics to ascertain the authorship" of the questioned signatures. The reason was that the signatures (which were in Chinese characters) were different in structure from the signatures that were provided by the first and second plaintiffs [See p 572 of encl 6 in the record of appeal].
[11] The trial court found that Norizah's testimony corroborated the plaintiffs' version of events, which was that they had never executed the Form 14A. The material portion of the grounds of judgment of the High court stated as follows:
[9] Mahkamah membuat dapatan fakta atas keterangan ini bahawa Plaintif-Plaintif adalah mangsa
