Plaintiffs failed to establish a trust over the property due to insufficient evidence, affirming indefeasibility of title under the National Land Code.

Quay Chew Soon J:

Introduction

[1] This suit concerns a property situated at Persiaran Gurney, Penang ("property"). Originally, the property was owned by the Plaintiffs. It was subsequently transferred by them to the Defendant ("D").

[2] The Plaintiffs claim that the transfer was done on the basis that D would hold the property on trust for them. The Plaintiffs now sue D to recover the property.

[3] After a full trial, I dismiss the Plaintiffs' claim. Here are the grounds of my judgment.

Background Facts

[4] On 27 December 2013, the Plaintiffs (as vendors) and D (as purchaser) entered into an agreement for the sale and purchase of the property at a purchase price of RM 500,000.00 ("SPA"). D took a bank loan to finance the purchase of the property. On 27 November 2014, the property was transferred to D.

[5] On 29 January 2016, D took another re - financing loan of RM 400,258.00 and RM 618,717.00 over the property.

[6] On 18 January 2020, the 1st Plaintiff ("P1") sent a WhatsApp message to D saying "I want to talk to you about the house". P1 is the husband of the 2nd Plaintiff ("P2").

[7] On 26 February 2023, discussions and drafting of an agreement for D to sell the property back to the Plaintiffs commenced. On 26 May 2023, the proposed sale was aborted. On 19 February 2024, the Plaintiffs initiated this action.

Plaintiffs' Case

[8] The Plaintiffs' case is this. In the year 2013, P2 was suffering from cancer. In contemplation of her death, the Plaintiffs transferred the property to D to hold it on trust for them. D is a close acquaintance of the Plaintiffs.

[9] It was agreed by the parties that D will hold the property on trust for the Plaintiffs. Whereby:- (i) the Plaintiffs will transfer the ownership of the property to D; (ii) D will obtain a bank loan to finance the purchase of the property and pay off the Plaintiffs' financier; (iii) the Plaintiffs will make monthly instalment payments to the bank in respect of the loan taken by D; and (iv) D shall transfer the property back to the Plaintiffs when requested.

[10] On 27 December 2013, the parties entered into the sham SPA. Whereby the Plaintiffs transferred the ownership of the property to D on the basis of trust according to the aforementioned arrangement.

[11] At all material times, no consideration was paid by D to the Plaintiffs for the purchase of the property. The Plaintiffs have made all loan repayments and ancillary payments for the property from 2015 until 2023.

[12] Around June 2022, the Plaintiffs asked D to re - transfer the property back to them, since P2 has recovered from the cancer. D refused to return the property to the Plaintiffs. Instead, D sought to blackmail the Plaintiffs by demanding for luxury handbags to be gifted to her in exchange for signing the transfer of the property.

[13] The Plaintiffs commenced this suit against D on 19 February 2024. The Plaintiffs' sue to obtain a declaration that D holds the property on a constructive trust for them. Whereby D shall transfer the property back to the Plaintiffs, as demanded.

Defendant's Case

[14] D's case is this. As P2 was suffering from cancer, the Plaintiffs requested P2's brother ("Chen") to help them financially. Chen agreed and requested D to buy the property from the Plaintiffs and take a bank loan to finance the purchase.

[15] Chen is D's common law husband. They have 3 children together. The Plaintiffs (especially P2) knew that Chen agreed for D to be the registered owner and borrower for the property, to hold it as trustee for the 3 children of D and Chen.

[16] The Plaintiffs sold the property to D. She is now the registered owner of the property. Since the Plaintiff