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2017 MarsdenLR 3582

FEDERAL COURT PUTRAJAYA
LETCHUMANAN CHETTIAR ALAGAPPAN @ L ALLAGAPPAN & ANOR – Appellant
Versus
SECURE PLANTATION SDN BHD – Respondent
[Civil Appeal No: 02-78-10-2014]



Petitioner Advocates:Cyrus Das,K Ramesh,Lynn Johnson ,Respondent Advocate: Cecil Abraham,Sunil Abraham,Tung Mun Yeong,Ellaine Alexander

Forged instruments, despite registration, lack validity; thus, allowing the appellant's appeal.

Headnote:Statute: Powers of Attorney Act 1949, Evidence Act 1950, National Land Code. The case involves several questions regarding the validity of a power of attorney and the rights of a bona fide purchaser. The appellants challenged the lower court's conclusions that identified the power of attorney as valid, alleging forgery. The court found that the impugned power of attorney did not comply with statutory requirements, thus affecting the validity of subsequent transactions. The issue framed was whether a complaint of forgery equates to fraud, with the court noting differing standards of proof. The trial court’s finding of validity was deemed incorrect; hence the appeal was upheld. The final ruling ordered the cancellation of the respondent's title.

Result: The appeal is allowed.

Table of Content
1. validity of power of attorney affects contract enforceability. (Para 1 , 2 , 4 , 6)
2. court questions the link between forgery and fraud. (Para 3)
3. standard of proof in forgery claims. (Para 5 , 8 , 9 , 19)
4. standard of proof for fraud in civil cases. (Para 7)
5. discussion on the evidentiary burden in forgery cases. (Para 10 , 11 , 12)
6. the burden lies with the respondent to prove validity. (Para 13 , 14 , 15)
7. judgment affirmed invalidity due to procedural failures. (Para 16 , 17 , 18)
8. conclusions drawn on circumstantial evidence of fraud. (Para 20 , 21)
9. rulings misguided regarding the certified document's validity. (Para 22 , 23 , 24)
10. final injunctions based upon legal perceptions of fraud. (Para 25 , 26 , 27)
11. validity of decisions on procedural legal standards. (Para 28 , 29 , 30)
12. judgment must be based on rigorous assessment of evidence. (Para 31 , 32 , 33)

[1] Leave was granted to the appellants to raise the following "questions of law" before this court:

(1) Whether a complaint of forgery in civil proceedings is necessarily in law a complaint of fraud?

(2) Whether it is correct in law for a court to treat a complaint of forgery as a complaint of fraud given the differing standards of proof presently in civil proceedings between forgery and fraud?

(3) Whether a case of forgery can only be proved by means of the opinion of a handwriting expert?

(4) Whether it is correct in law to cast the burden of proving that the sale of a property was not genuine on the plaintiff or alleged vendor?

(5) Arising from the question above, whether the correct position in law is that the burden of proving that he is a bona fide purchaser for value without notice is rightfully to be placed on the purchaser?

(6) Whether a bona fide purchaser for value can be registered as a proprietor of a land in a situation where a formal transmission from a deceased to a personal representative pursuant to s 346(5) of the National Land Code was not registered?

[2] The undisputed background facts could be paraphrased as follows. S Alameloo Achi Alias Sona Lena Alamelo Achi (deceased) was the registered owner of land measuring 39.31 acres and held under Geran 98602 for Lot 725 Bandar Kulim (said land). The 1st appellant was the executor of the will of the deceased. The 2nd appellant was the lawful attorney of the 1st appellant. By written agreement dated 4 September 2009 (SPA), Kalidas a/l Komarawelo (Kalidas), as purported attorney of the 1st appellant pursuant to a Power of Attorney No 1938/09 (impugned PA), agreed to sell the said land to the respondent at the price of RM5,650,862.09. The respondent paid the contractual deposit of RM564,941.14 to Tetuan M Raman & Associates, solicitors for Kalidas. Thereafter, the respondent secured a bank loan of RM2.8m to finance its purchase of the said land, and paid the differential sum between the balance purchase price and loan sum to Tetuan M Raman & Associates. On 5 January 2010, the memorandum of transfer of the said land executed by Kalidas, purportedly as attorney of the 1st appellant, in favour of the respondent, and the memorandum of charge by the respondent in favour of the lender bank were presented for registration. But both instruments were rejected for registration by the Registrar of Titles. On 23 February 2010, the 2nd appellant lodged a police report that the 1st appellant had not executed any instrument/document of transfer of the said land to the respondent, and that any such instrument/document was false. And on 25 February 2010, the 2nd appellant lodged a private caveat to prohibit the registration of any dealing of the said land. The Registrar of Titles intervened and lodged a registrars caveat and issued, after due inquiry conducted on 8 March 2010, a new document of land title to the 1st appellant. In response, the respondent on 16 May 2010 filed action (High court at Alor Setar Civil Suit 21-10-2010) for specific performance of the SPA and for damages against (i) t

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