WHERE IS YOUR GERAN TANAH?
Ahmad Jailani Abdul Ghani
1. Where is your “geran tanah” (issue document of title)? Under your safekeeping? Where? Your safety box? Are you sure? You have to prepare yourselves if one fine day, you go to the respective land office, make the land search and find out that you are no more the owner of your land whether it is “sekangkang kera” or “sejauh mata memandang.” BEWARE!!!
LANDMARK’S CASE IN MALAYSIA EXPLAINS THE CONCEPT
OF DEFERRED INDEFEASIBILITY OF TITLE
2. The decision of the Federal Court in 2001 with regard to deferred indefeasibility, shocked our nation, because the effect of the said decision, land owners may, after wake-up in the morning, find themselves no longer owning their landed properties, without any fault, doing or knowledge on their part, and their issue document of title (IDT) are under their safekeeping!!!
3. The above mentioned case is ADORNA PROPERTIES SDN BHD V BOONSOOM BOONYANIT @ SUN YOK ENG  1 MLJ 241. The facts of the case are as follows:-
Mrs Boonsom Boonyanit (“BB”) is the registered owner of two valuable pieces of land in Tanjung Bungah, Penang. She was and still is in possession of the two original documents of title. She is a Thai national and never enggage any lawyer or anyone to sell the properties. BB paid all quit rents and assessments from the time she became the owner of the said land.
4. One woman claiming herself as BB used a forged passport and two false statutory declarations and obtained the replacement titles from the Land Office. She signed the Memorandum of Transfer and sold the properties to Adorna. The real BB was completely unaware of all these acts of the imposter. The imposter sold the two pieces of land to Adorna for almost RM 1.8 million.
5. In 1989, BB commenced an action in Penang High Court, against Adorna for an order that Adorna’s registration as proprietor be cancelled from the Register of Land Titles since she is still the registered proprietor of the properties.
6. However, Adorna contended that they are bona fide purchasers for value without notice of the fraud or forgery and therefore had acquired indefeasible titles to both the lands.
7. Penang High Court (Justice Vincent Ng as he was then) dismissed BB’s claim stating that Adorna had acquired an indefeasible title over the properties by virtue of Section 340 (3) NLC with regard to deferred indefeasibility, which protects any title or interest acquired by any purchaser in good faith and for valuable consideration.
8. BB, then appealed to the Court of Appeal, whereby the Court allowed her appeal. The Court ordered the Registrar of Land Titles to cancel all entries made in the Register of Titles in favour of Adorna and restore BB as the registered owner. The decision of the Court was delivered by Justice Dato’ Gopal Sri Ram and he set out the true interpretation of deferred indefeasibility. The Court of Appeal held inter-alia (10):-
· The standard of proof to be applied in civil forgery suits is the balance of probabilities.
· The words ‘any purchaser’ in Section 340 of NLC refers to a subsequent and not to an immediate purchaser, hence creating a deferred indefeasibility which benefits subsequent purchasers. The title of an immediate purchaser is defeasible if tainted by one or more of the vitiating elements set out in section 340 (2) but creates an exception in favour of a bona fide purchaser who take his title from such a registered proprietor.
· By virtue of Section 340, a registration by forgery is of no effect.
· In Malaysia, under Section 340 of NLC, deferred indefeasibility applies. The registered proprietor who by registration of a void or voidable instrument does not acquire an indefeasible title. The indefeasibility is postponed until the time when a subsequent purchaser acquires the title in good faith and for valuable consideration.
9. According to this true interpretation, deferred indefeasibility is when “A” by fraud or forgery acquired a landed property. He then sold the property to “B” a bona fide purchaser. Then “B” as the second registered owner after “A”, sold the property to “C” another bona fide purchaser. “C” as the third registered owner is now having indefeasible title because the title deferred to him.
10. Unfortunately, when Adorna appealed to the Federal Court, the Court reversed the decision of the Court of Appeal and upheld the Penang High Court decision.
MAYDAY FOR JUSTICE!!!
11. The above mentioned case gave great impact and prejudice to the credibility of our justice system and government in the eyes of people (rakyat). Our nation would have no more confident with the system and government, because the court’s decision itself (not the thief) deprived their properties while they are at no fault.
12. The court is the sacred place for the people to get justice and protection. But now, it turns otherwise. Both legislature and judiciary have to do something and work hand in hand to protect the interest of the nation!!!
Ahmad Jailani Abdul Ghani