Solicitors acting for a fraudster do not owe a duty of care to the true land owner, reinforcing deferred indefeasibility for bona fide purchasers under the Torrens system.

[1] This judgment is prepared pursuant to s 78 of the Courts of Judicature Act 1964, as then Chief Justice and President of the Court of Appeal have since retired. This is a unanimous decision by the remaining members of the panel who heard this appeal.

[2] These three related appeals emanated from a suit in the High Court of Malaya at Shah Alam under Civil Suit No: 21-136-2007. The appeals are against the decision of the Court of Appeal, which reversed the decision of the High Court after a full trial of the matter arising out of a replacement issue document of title that was issued by the land authorities and the fraud committed using this title. As a result of which, the unfortunate original landowner had been defrauded of her land.

[3] One of the main disputes in these appeals is about the competing claims on the ownership of the land between two innocent parties, that is to say, the plaintiff as the original owner and the 1st defendant as the current registered proprietor of the land cum a subsequent purchaser in good faith and for valuable consideration.

[4] In addition, these appeals also raise an important issue and one that most closely involves the legal profession: whether solicitors owe a duty of care to third parties.

The Three Appeals

[5] The first appeal, which is Federal Court Civil Appeal No: 01(f)-32-10-2016 (B) is by Pushpaleela a/p R Selvarajah and Messrs MY Choong, Pushpa & Co (the 3rd and 4th defendants in the High Court). Rajamani d/o Meyappa Chettiar (the plaintiff in the High Court) is the respondent.

[6] In the second appeal, which is Federal Court Civil Appeal No: 01(f)-33-10- 2016 (B) the appellant is Eng Beng Development Sdn Bhd (the 1st defendant in the High Court). While the respondents are as follows: the 1st respondent is Rajamani d/o Meyappa Chettiar (the plaintiff in the High Court); the 2nd respondent is Infinite Income Sdn Bhd (the 2nd defendant in the High Court); the 3rd respondent is Pushpaleela a/p R Selvarajah (the 3rd defendant in the High Court); the 4th respondent is Messrs MY Choong, Pushpa & Co (the 4th defendant in the High Court); the 5th respondent is Pentadbir Tanah Daerah Klang (the 5th defendant in the High Court); the 6th respondent is Pendaftar Hak Milik Negeri Selangor (the 6th defendant in the High Court); and the 7th respondent is Sheelan Arjunan (the 7th defendant in the High Court).

[7] The third appeal, which is Federal Court Civil Appeal No: 01 (f)-34- 10/2016 (B) is by Sheelan Arjunan (the 7th defendant in the High Court) and the respondent is Rajamani d/o Meyappa Chettiar (the plaintiff in the High Court).

[8] We shall refer to the parties in this judgment as they were cited in the High Court.

The Parties

[9] The plaintiff was the original registered proprietor and lawful owner of a parcel of land known as EMR 6527 ("the land"), until she was deprived of her rights to her land in what was aptly described as a "land scam case" by the High Court. The plaintiff had at all material times been in possession of the original manual issue document of title ("IDT1") to the land. She had never parted with the title of the land. She commenced the suit for loss of ownership and recovery of her land. She had named seven defendants whom she alleged were liable to her losing ownership and interest to the land.

[10] The 1st defendant, a private limited company was the subsequent purchaser of the land, having purchased it from the 2nd defendant for a consideration of RM1.8 million ("the second transac