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2015 MarsdenLR 2471
COURT OF APPEAL PUTRAJAYA
JW PROPERTIES SDN BHD – Appellant
Versus
PERBADANAN KEMAJUAN PERTANIAN SELANGOR & ANOR – Respondent
[Civil Appeals Nos: B-01-100-03-2014 & B-01-101-03-2014]
Appellant entitled to compensation despite absence of State Authority consent due to equitable interest in land.
Headnote:The judgment addresses the issue of compensation for land compulsory acquired, focusing on the legal ownership and beneficial interest of the appellant in the Api-Api land. The court ruled that compensation is payable to the appellant despite the absence of consent from the State Authority for land transfer, emphasizing equitable principles and the doctrine of constructive trust. The outcome affirms the appellant's entitlement to compensation.
| Table of Content |
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| 1. consolidated appeals focus on compensation for land acquisition. (Para 1 , 2 , 3 , 4 , 5) |
| 2. pkps's obligation to obtain state approval for land transfer. (Para 6 , 7 , 8 , 9 , 16) |
| 3. payment and ownership complexities of land transfer arrangements. (Para 10 , 11 , 12 , 13) |
| 4. appellant's long-term possession as an interest recognized by law. (Para 14 , 15 , 20) |
| 5. legal claims of ownership and compensation under public acquisition. (Para 18 , 19 , 22) |
| 6. legal principles regarding ownership vs registration in compensation matters. (Para 23 , 26 , 29) |
| 7. equitable and beneficial interests established for compensation. (Para 31 , 33 , 36) |
| 8. constructive trust claims in favor of equitable interests in land. (Para 34 , 35 , 51) |
| 9. final ruling on compensation entitlement and implications for respondents. (Para 53 , 56) |
[1] These two consolidated appeals arose from the decision of the High Court at Shah Alam adjudging that the compensation for the compulsory acquisition of land held under Lot PT 3708, HS(D) 4588, Mukim Api-Api, District of Kuala Selangor was payable to the 1st respondent, Perbadanan Kemajuan Pertanian Selangor ("PKPS"). The learned judge rejected the appellant, JW Properties Sdn Bhd's claim that it was entitled to the compensation.
[2] Although there are two appeals before us, parties confirmed that they are against only one judgment of the High Court and they relate to only one subject matter, namely land held under Lot PT 3708, HS(D) 4588 Mukim Api-Api, District of Kuala Selangor. We reserved judgment after hearing arguments on 13 August 2015. We have now reached a unanimous decision and this is our judgment.
[3] We shall try to simplify the facts as they are not as straightforward as they can be. By alienation letter dated 13 June 1990, the Selangor State Government approved the alienation of a piece of land measuring 109.265 acres in the Mukim of Jugra, in the District of Kuala Selangor ("the Jugra land") to PKPS, a statutory body and agency of the State Government.
[4] Two years later, by alienation letter dated 28 July 1992, the State Government approved the alienation of another piece of land to PKPS, this time for an area measuring 137 acres in the Mukim of Api-Api, also in the District of Kuala Selangor ("the Api-Api land"). This is the subject matter of the present appeals.
[5] At the time of the approvals, the issue documents of title for these two plots of land had yet to be issued by the State Authority. Both lands were subject to the category of land use as being for aquaculture only and were also subject to a restriction in interest that the lands shall not be sold, leased, charged or transferred in any way whatsoever without the consent of the State Authority.
[6] With the approvals for alienation, PKPS became the beneficial owner of both the Jugra and the Api-Api lands. By a sale and purchase agreement executed on 31 July 1995 ("the first agreement"), PKPS in its capacity as beneficial owner sold both lands to a company in which it was a shareholder, namely PKPS Aquaculture Sdn Bhd ("PKPS Aquaculture").
[7] On the same day that it sold the Jugra and Api-Api lands to PKPS Aquaculture, PKPS entered into a sale of shares agreement ("the second agreement") with another company under the style and name of Suati Holdings Sdn Bhd ("Suati Holdings"). The agreement was for the sale of all of PKPS shares in PKPS Aquaculture to Suati Holdings for a purchase consideration of RM4 million. Under the agreement, Suati Holdings was also to take over and assume full responsibility for PKPS Aquaculture's liabilities in the sum of RM7 million which included the corporate guarantee in the sum of RM4 million given by PKPS. This second agreement was referred to in cl 6 of the first agreement as follows:
"By another agreement of even date (hereinafter referred to as "the sale of shares agreement") between the vendors herein of the one part and SUATI HOLDINGS SDN BHD of the other part, the vendo
