INTERNATIONAL ISLAMIC UNIVERSITY MALAYSIA

END-OF-SEMESTER EXAMINATION
SEMESTER 1, 2014/2015 SESSION

AHMAD IBRAHIM KULLIYYAH OF LAWS

Programme : Bachelor of Laws Level of : Third
Study

Reading Time : 2.30 p.m. – 2.45 p.m. Date : 8.1.2015

Duration : ( 15 minutes )

Answering Time : 2.45 p.m. – 5.45 p.m. Section(s) : All Sections

Duration ( 3 hours )

Course Title : Land Law II Course Code : LAW 3111

This Question Paper Consists of 8 Printed Pages With 6 Questions.

INSTRUCTIONS TO CANDIDATES

DO NOT OPEN UNTIL YOU ARE ASKED TO DO SO.

Answer FOUR (4) Questions only.

REFERENCE(S) ALLOWED

NATIONAL LAND CODE 1965

STATUTES OF COMPILATION FOR LAND LAWS

Any form of cheating or attempt to cheat is a serious

offence which may lead to dismissal
Statutes should be free from any form of annotations.
APPROVED BY
QUESTION 1

Mr. Liam is the registered proprietor of a piece of land with a huge mansion erected on it.

On 13th April 2013, Mr. Liam deposited the original issue document of title (IDT) to his

land with Dollar & Cents Bank as a security for an overdraft facility granted by the bank

to him. Dollar & Cents Bank’s lawyers however, failed to enter any type of caveat on the

land.

On 11th May 2014, Mr. Liam entered into an agreement to sell the land to Hj. Soleh. Mr.

Liam explained the absence of the IDT by saying that he had lost it. He told Hj. Soleh

that he is in the process of applying for a new IDT. He however allowed Hj. Soleh to take

possession of the land if Hj. Soleh paid 50% towards the purchase price. The actual

transfer would be affected upon the receipt of the IDT from the land office. Hj. Soleh

paid the sum and took possession and moved into the house.

Mr. Liam procrastinated in transferring the land despite several requests by Hj. Soleh. Hj.

Soleh was advised by his friend that he should protect his claim by entering a caveat

against Mr. Liam’s interest. To his surprise Hj. Soleh found out that a Registrar’s Caveat

was entered on the title following an application made by the Inland Revenue Department

under paragraph (b)(i) and (ba) of section 320(1) of the National Land Code, 1965, on the

ground that Mr. Liam was owing a substantial amount of income tax to the department

for the past 3 years. The Registrar’s Caveat was entered on 6th July 2014.

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On 25th August 2014, the Registrar served a notice on Mr. Liam informing him of the

entry of the caveat. Money & Cents Bank and Hj. Soleh want to know the following:

(i) Assume Hj. Soleh proceeded to enter a caveat on the land following his friend’s

advice, what kind of caveat is to be entered and why? And what would be the

effect of such caveat?

(4 marks)

(ii) What would be the legal position of Money & Cents Bank?

(3 marks)

(iii) Whether the said Registrar’s Caveat was validly entered by the Registrar and

why?

(4 marks)

(iv) Whether Money & Cents Bank and Hj. Soleh can remove the said Registrar’s

Caveat?

(4 marks)

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QUESTION 2

(a) Soon Finance had granted to Wan Ismail (“borrower”) a temporary overdraft

facility of $125,000 with interest at the rate of 14% per year. In support of that

facility, Nik Jamil on 17th January 2013 agreed to charge his property held under

land office title, identified as Lot 1572 Geran No.15325 Mukim Selayang,

Selangor ("the said land"), as security. According to Soon Finance, pursuant to

that document, Nik Jamil had agreed to be jointly and severally liable for the loan.

Wan Ismail later defaulted on the terms of the facility agreement. Soon Finance

issued letters of demand to both, Wan Ismail and Nik Jamil. However, both of

them ignored the demand letters. To recover the debt, Soon Finance took

immediate steps to foreclose the charge. To their surprise, they discovered that the

charge was never registered with the land office.

Advise Soon Finance on the status of the charge and remedies that are available.

Support your answer with statutory provisions and decided cases.

(7 marks)

(b) Assuming that the charge was registered and Soon Finance decides to take

foreclosure proceedings, explain to Soon Finance on the procedures involved.

(8 marks)

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QUESTION 3

(a) Compare and contrast the functions of the Registrar in entering the different types

of caveat as prescribed in the National Land Code 1965. Support your answer

with decided cases and statutory provisions.

(7 marks)

(b) Hong Gay is a partner of a firm known as Hong Curtain and Furnishings since

1999. She managed the business with her sister Hong Kim for only two months.

After the registration of the firm, Hong Gay left for the United States sometime in

July 1999 and returned to Malaysia on August 2002. After some 11 years, she is

now a permanent resident there. Meanwhile, Hong Kim managed the business of

the firm.

Before Hong Gay left Malaysia, she bought and became the registered proprietor

of a piece of land in Mukim Gombak. Since she left Malaysia before the title to

the said land was issued, she entrusted to her sister the responsibility of keeping

the IDT once it is issued.

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While she was away in the United States, Zack, the manager of the firm,

deposited the IDT of Hong Gay’s land to Bank Mekar to secure a loan granted to

Hong Curtain and Furnishings. Zack, a Singaporean, is Hong Kim’s boyfriend.

When Hong Gay questioned Zack, he claimed that he has been authorised by

Hong Kim to arrange for the said loan. Besides that he also claimed that he is a

partner to the firm. Bank Mekar entered a lien holder’s caveat accordingly.

The firm’s business was not doing well due to heavy competition and

consequently it defaulted in making the repayments to Bank Mekar. The latter

wanted to exercise its right under the National Land Code 1965 after the Notice of

Demand issued by their solicitor was ignored by the company. Hong Gay was

angry and decided to intervene in the proceedings.

Advise Hong Gay and Bank Mekar on their rights in the above situation. Support

your answer with statutory provisions and decided cases.

(8 marks)

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QUESTION 4

(a) Discuss the rationale for introducing land reservation for the benefit of a

particular community with specific reference to the introduction of the laws

relating to the Malay Reservation Land in the states of Peninsular Malaysia.

Support your answer with statutory provisions and decided cases.

(8 marks)

(b) Hj. Jais was the registered proprietor of a Malay Reserved land in Kuala Selangor.

In 2009, he sold the land to Wak Karman, an Indonesian citizen who had settled

in the village for a number of years. This sale was evidenced by a written

agreement where the land was sold for RM50,000. The land however, remained in

the name of Hj. Jais until he passed away in 2013. His son, Mohd. Jamil, who is

the administrator of his father’s estate, wishes to bring an action against Wak

Karman to vacate the said land. Wak Karman argues that based on the written

agreement between himself and Mohd. Jamil’s father, he is now the lawful owner

of the land. Mohd. Jamil however argues that since Wak Karman is not a

Malaysian citizen, the said agreement is null and void. Advise both parties as to

whether the sale of the Malay Reserved land to Wak Karman is valid having

regard to the provisions of the FMS Malay Reservation Enactment (Cap. 142) and

decided cases.

(7 marks)

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QUESTION 5

Despite, the guaranteed protection for private landowners’ property rights by the Federal

Constitution 1957 of Malaysia, the existence of the Land Acquisition Act 1960 that

provides the State Authority with wide powers to acquire land belonging to private

landowners appears to be violating the concept of inviolability of private landowners’

rights to property.

Discuss with reference to decided cases, the rationale behind the power of acquiring land

compulsorily by the State Authority and if there are any grounds upon which the

landowner can challenge such acquisition.

(15 marks)

QUESTION 6

(a) Building high-rise accommodation has resolved the immediate needs of housing.

However, the purchasers of accommodation units in high-rise buildings are posed

with the problems of creating security in favour of financial institutions. This is

due to the fact that the high-rise building is built on a land with one Master title.

Discuss the important procedures involved in applying for strata titles.

(8 marks)

(b) Explain the role of the Management Corporation in administering high-rise

buildings in Peninsular Malaysia.

(7 marks)