JUDGMENT

Eusoff Chin CJ:

For the purpose of this appeal it is sufficient to give only the brief facts of the case. The plaintiff who is the respondent in this appeal, and who is a Thai citizen, claimed that she was the registered proprietor of lands lots 3606 & 3607 Mukim 18, Tanjung Bungah, Penang. She claimed that she was the true

Mrs. Boonsom Boonyanit holder of Thai passport No. D 080757, and that another person holding a Thai passport No. 033852 bearing the name of Mrs. Boonsom Boonyanit had forged her (the plaintiff's) signature, and had sold and transferred her lands to the defendant Adorna Properties Sdn Bhd. which is the appellant in this appeal. Before the sale, the lands had been valued by an independent property valuer. There were negotiations on the purchase price, and on 15 December 1988 a sale & purchase agreement was signed, and the lands were finally transferred to the purchaser/appellant on 24 May 1989. The appellant, Adorna Properties claimed that it had no knowledge that the transfer documents were forged by someone who was not the true owner, and had no reason to suspect that they were forged. Both the vendor and purchaser/appellant were represented by different solicitors in the sale & purchase of the lands. Further, it was not disputed that the sale was an arm's length transaction.

The detailed facts of this case can be found in the High Court judgment which is reported in [1995] 4 CLJ at 45.

The High Court dismissed the plaintiff's claim that she (plaintiff) be restored as the registered owner of the lands.

On appeal the Court of Appeal reversed the order of the High Court. Hence this appeal to the Federal Court. The Court of Appeal judgment is reported in [1997] 3 CLJ 17.

Before us, two questions of law were posed for decision and the first is:

i) For proof of forgery such as the one under appeal, whether the standard of proof is on balance of probabilities, or on beyond reasonable doubt?

The same arguments which the parties had put before both the High Court and the Court of Appeal were again argued before us. The High Court held that forgery must be proved beyond reasonable doubt, while the Court of Appeal held that it should be on a balance of probabilities. For the reasons given by the Court of Appeal - see [1997] 3 CLJ 17, at 31-35, we entirely agree that the standard of proof required to prove 'forgery' in civil cases is one on a balance of probabilities.

The other question put for argument and decision in this appeal is:

(ii) Whether the defendant, a bona fidepurchaser for valuable consideration without notice, acquired an indefeasible title to the properties (the lands) by virtue of s. 340(3) of the National Land Code 1965?

The Court of Appeal held that the signature on the document of transfer was forged. The High Court judge had stated in his judgment that had he adopted the balance of probability standard of proof, there was sufficient evidence to show that the plaintiff's signature was forged.

Both the High Court and Court of Appeal analysed the authorities as early as the year 1917, ie, Ong Lian v. Tan Eng Jin[1917] 1 FM SLR 327, Choo Loong v. Lip Kwai Kow[1930] 7 FM SLR 213; Ong Lock Cho v. Quek Shin & Sons Ltd [1941] MLJ 88; Frazer v. Walker[1967] AC 569; Doshi v. Yeoh Tiong Lay[1974] all based on earlier legislations ie, s. 42 FMS Land Code and ss. 62, 182, 183 of the New Zealand's Land Transfer Act 1952. Both courts also considered carefully Doshi v. Yeoh Tiong Lay[1974]. The High Court held that Doshiwas correctly decided by the then Federal Court in that the registration conferred an immediate indefeasibility under our version of the Torrens System, whereas the Court of Appeal held otherwise.

The present National Land Code (NLC) was enacted by Parliament in 1965 to be applied to all the States in West Malaysia. In doing so s. 338 of the NLCrepealed all earlier land enactments of the States, and those enactments repealed, are enumerated in the Eleventh Schedule to the NLC.

We are awar