Raja Azlan Shah FJ (delivering the judgment of the Court):

This case concerns alienation of a piece of State Land dated 13 May 1971 and made by the State Authority whereby an industrial lot in Jalan Skudai, Johor Bahru, measuring about three acres was granted by the State Authority to the respondent company for a term of 60 years, subject to the provisions and conditions contained in the National Land Code and to a number of specified conditions referred to in the Qualified Title as, and therein set out under the heading of "Special Conditions" (s. 109). The said conditions comprised six numbered paragraphs of which the first three are in these terms:

"i. The land hereby leased shall be used solely for the erection of a factory.

ii. Within 24 months from the date of Registration of QT, the lessee shall build upon the land hereby leased only a factory according to plan approved by the Town Council and the Collector of Land Revenue, Johor Bahru.

iii. The land hereby leased shall not be transferred, charged, sub-leased or otherwise disposed of until the building of the factory required by the condition first above written has been completed as evidenced by endorsement thereon under the hand of the Commissioner of Lands and Mines."

Two other express conditions are referred to in the Qualified Title. One is with regard to the payments of premium and deposit and the other is restriction as to user, i.e., "supaya plot 2 dikawasan Jalan Skudai, Johor Bahru dijadikan kawasan perusahaan rengan" and that the jenis perusahaan "membuat kilang zing, wire-netting, screw dan nuts". These are expressed by references to State Executive Council, Johor Paper PTG 267/59-11 and a letter of the appellant to the respondent company dated 1 March 1970, vide AAJB 3/v/243/69.

The factory was built in with the stipulated time and on 13 May 1975 the Commissioner of Lands & Mines lifted special condition (iii) (above) and endorsed it at the back of the Qualified Title. On 11 June 1976, the respondent company sub-leased a portion of the factory built thereon to Perbadanan Urea dan Baja Malaysia Sdn. Bhd. ("the urea compa') to use it as their store for storing its industrial chemicals and fertilisers and also as their office for their storekeeper for three years at the rent of $1,400 per month. Thereupon, on 22 January 1976 the appellant issued a notice in Form 7A under s. 128 requiring the respondent company to remedy the breach within a period of one month. It is common ground that the notice was not complied with. On 8 March 1976 the or appellant issued a notice in Form 7B under s. 129 requiring the respondent company to appear before him in an inquiry to show cause why he should not make an order declaring the land forfeited. At the inquiry which was held on 29 March 1976 the respondent company admitted the breach and asked for time to evict the urea company. They were ordered to remedy the breach on or before 30 June 1976. Instead of complying with the said order, they however, on 19 April 1976, filed a Notice of Motion to declare that the proceedings against them under the provisions of ss. 128 and 129 of the National Land Code were misconceived and illegal and as such null and void. The Court delivered judgment in their favour on 15 June 1976. The appellant appealed. We allowed the appeal.

It is common ground that the respondent company has not remedied the breach.

The learned Judge adopted the reasoning of Hyman v. Rose [1912] AC 623, 631 that if it was contemplated in a lease to prohibit a different user, that must be expressed as a condition. He thus said:

The principle underlying this authority as far as I can see, is that in a lease if it is contemplated to prohibit a different user or alteration of premises for different user, then there must be an express condition. In the present case it is common ground that the lease shall be used solely for the erection of a factory. The questions to be determined are whether the use carrier