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2011 MarsdenLR 3812
HIGH COURT KOTA KINABALU
PORT VIEW SEAFOOD RESTAURANT SDN BHD – Appellant
Versus
THE DIRECTOR OF LAND AND SURVEYS SABAH – Respondent
[K21-46-2009-I]
The court held that legitimate expectation cannot override statutory provisions, and a concluded agreement for lease extension did not exist due to lack of acceptance.
Headnote:(A) Land Ordinance - Sections 9(1) and 57 - Government Proceedings Act - Section 29 - The Plaintiff sought a declaration that the Defendant's rejection of its lease extension application was void and claimed damages for being misled. The court found no concluded agreement due to lack of acceptance of the offered terms and ruled that the doctrine of legitimate expectation was not applicable because the government decision contradicted existing regulations. The court emphasized the need for compliance with legal frameworks over policy expectations. (Paras 10, 13, 14, 15, 18)
Facts of the case:
The Plaintiff is the legal owner of land with a lease expiring in 2011. It sought an extension before lease expiry, but the government issued a decision halting renewals in the area. Despite an offer to extend, no acceptance was recorded by the Plaintiff. The Defendant's failure to act timely led to the Plaintiff being deprived of compensation post-acquisition of its land.
Findings of Court:
The court found no concluded agreement due to the absence of acceptance, rendering the lease extension application ineligible. The principles of legitimate expectation could not conflict with statutory provisions set forth by the Land Ordinance and Government Proceedings Act.
Issues: The primary issues were whether a concluded contract existed for lease extension and the applicability of the legitimate expectation doctrine in the context of government dealings.
Ratio Decidendi: The court determined that legitimate expectation could not override statutory mandates and that procedural shortcomings by the government did not afford entitlement to relief beyond established legal frameworks.
Result: Plaintiff's claims dismissed without costs.
| Table of Content |
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| 1. plaintiff seeks orders related to lease extension (Para 1) |
| 2. background facts of lease extension request (Para 2 , 3) |
JUDGMENT
Proceeding;
The Plaintiff in this case basically prayed for the following orders:-
a. A declaration that the Defendant's decision under reference LSC: 122.1.1725/39 dated 16.6.2006 (received by the Plaintiff on the 23.1.2007) in wholly rejecting the Plaintiff's application for extension of the lease term on TL No. 017506982 be declared null and void;
b. That the Defendant's 1st Offer under reference LS.122.1.1725/16 be extended for a period of 3 months from the date of this Order is granted by this Honorable Court;
c. That in the event that the Defendant had duly rejected the Plaintiff's application for reduction of the land premium as per the Plaintiff's letter dated 6.4.2005, that the Plaintiff be given a period of 3 months from the date of this Order is granted to accept or reject the Defendant's 1st Offer as in reference LS.122.1.1725/16 and to comply with the conditions as set out in the Defendant's offer under reference LS. 122.1.1725/16;
d. In the event that the Court finds that the Plaintiff was misled into not accepting the 1st Offer dated 14.10.2005, the damages suffered by the Plaintiff be assessed (this additional prayer was granted by this Court on the 23.8.2011 as a result of the application of the Plaintiff;
e. For such further Order and relief as this Honourable Court deems fit.
Background facts;
The factual matrix of this case is not in dispute and they are these. The Plaintiff is the registered and legal owner of a parcel of land under title number TL No. 017506982 (Land) which lease was due to expire on 10.3.2011. In anticipation of the expiry of the lease, the Plaintiff applied to the Defendant for extension of it on 30.6.2004. On 1.9.2004, the Sabah State cabinet decided that no renewal of lands situated in the vicinity of the Kota Kinabalu International Airport and it is undisputed that the Plaintiff's land is within that vicinity. The cabinet's decision was relayed to the Defendant on 3.11.2004. Despite that decision, the Defendant in response to the Plaintiff's application issued an Offer to the Plaintiff dated 14.10.2004 to extend the lease on the condition that the Plaintiff is to pay a premium of RM 1,320,000.00 to the State Government of Sabah. That Offer of extension was due to expire on 31.7.2005. Prior to that expiry, the Plaintiff on 6.4.2005 appealed for a reduction of the premium by 50%. It is the undisputed evidence of DW1 (who is the officer of the Defendant who entertained the Plaintiff in this appeal for reduction) that the appeal was successful resulting in DW1 requesting the Plaintiff to return the Offer dated 14.10.2004 to the Defendant for the purpose of issuing by DW2, the then Deputy Director of Land and Survey Department, an Offer of Amendment with the requested reduction of the premium. That Offer of Amendment was never issued to or given to the Plaintiff but was shown to the Plaintiff by DW1.
On 23.1.2007, the Plaintiff received a letter from the Defendant that the Plaintiffs application for extension of the lease could not be entertained as the Kota Kinabalu International Airport would be extended and the Plaintiff's land is affected by the extension.
In view of this, the Land was compulsorily acquired and hence giving rise to the crux of the Plaintiff's complaint which in essence is that the Plaintiff had been deprived of an opportunity to extend the lease and the consequence of which is that it will be deprived of compensation of a parcel of land which lease would only expire in year 2110 as opposed to 2011 as it is now.
Issues:
From the above matrix and the submissions of counsel, the following in my view are the determinative issues:
1. Whether there is a concluded agreement between the Plaintiff and the Defendant in respect of the extension of the lease of the Land?
2. Whether the doctrine of legitimate expectation is applicable?
3. In the circumst
