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SKS Bhd. is a registered proprietor of an industrial land in Seri Kembangan, Selangor. The land was held under a 60 years lease (qualified title). There are two express conditions on the title. First, this land is to be used solely for erection of a factory and second, to be used for light industries. SKS Bhd. rented out the land to a urea company that used a portion of the land to store industrial chemicals and fertilisers. Later, the Land Administrator found out that and deemed such use of land as a breach of the conditions and issued a notice requiring SKS Bhd. to remedy the breach within one month. SKS Bhd. disagreed with the notice of remedy as there is no specific prohibition to use the land as a store. SKS Bhd. consults you for advice.(10 marks)

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Section 79(2) of the National Land Code 1965 provides matters that the State Authority will determine upon approving alienation, which will include category of land use and condition.

Explain the differences between the following and give examples to   illustrate:

a.     Categories of land use and classification of land;

b.     Conditions and restrictions in interest.

(12 marks)

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Chong has failed to pay the quit rent for his land for the past five years. He has recently received a notice of demand in Form 6A from the Land Administrator to pay the arrears of quit rent. Advise Chong on the steps that must be taken by the Land Administrator for the forfeiture proceedings under the National Land Code [Act 56].
(10 marks)

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The first issue is whether Zikri has breached the express conditions stipulated on his Issue Document of Title (IDT) since he has left the agricultural land idle. Generally, any alienated land which falls under category “agriculture” is subject to implied conditions under Section 115(1) of the National Land Code (NLC) 1965. However, according to Section 115(3) of the NLC, if there is any express condition of the land inconsistent with the Subsection (1), the implied conditions are not applied. From such provision, it means that other than implied condition, express conditions are conditions written on the document title to the land for the use of the land and they are applicable over implied conditions.

In the present case, the express conditions are stipulated on Zikri IDT which are; first, the land can only be used to cultivate palm oil trees and that secondly, the cultivation must be done within two years of the land. According to S. 115(3) of the NLC, Zikri was obliged to perform based on the express conditions as required on IDT upon his agricultural land.

When a breach of condition arises? Section 125(1) of the NLC states that a breach of a condition requiring continuous performance to occur as soon as it is not complied with and continue so long as the condition is not met. Meanwhile, Subsection (2) states that a breach of a condition subject to a fixed term arises when (a) in the case of a condition requiring the doing of any act within any time upon the expiry of that time without the act having been done, (b) in the case of a condition requiring any act to be refrained from until any time, upon the doing of that act before that time.

In the case of Collector of Land Revenue (JB) v South Malaysian Industries Bhd, the land was leased and alienated to the respondent company as an industrial land with condition that the land is to be used solely for erection of a factory and only for light industry. A portion of land was rented out and being used to store industrial chemicals and fertilizer. The Collector deemed that such use of land as a breach of condition. The respondent company brought an action against the Collector that the proceeding against it was illegal as there is no special condition prohibiting the use of land as a store. The Court of Appeal held that the express conditions imposed an imperative obligation on the respondent to use the factory premises for light industry. Therefore, storing of industrial chemicals and fertilizers was not a legitimate purpose of use permitted under the lease.

Thus, the effect of breached implied condition could be seen in the case of Che Minah bt Rameli v Pentadbir Tanah Daerah Besut & Anor, the plaintiff was a registered proprietor of land held under the category 'agriculture' in Besut. Later, she was being notified that there was a breach of an implied condition under section 115 by the Besut land officer. This is because there were several building on the land including a sundry shop and surau. After the plaintiff made an application to change the category of land, her application was rejected. The defendant made an order that the breach of condition should be remedied within 15 days otherwise it would be forfeited.

Applying to Zikri situation, he has failed to cultivate the land with palm oil trees within a fixed term, two years since he left the land empty for five years. Such non-compliance of the conditions by Zikri is a breach of conditions subject to s. 125(2)(a) of the NLC in the case of a situation requiring him to perform cultivation of palm oil trees within 2 years and turned out, after the expiry of that time, no action is done.

The second issue is whether the Land Administrator (LA) can forfeit the land from Zikri because of non-compliance of the duties imposed on him. Land can be forfeited for breach of either express condition or an implied condition. Upon the breach of enforcement conditions, the Land Administrator has a right to choose either following proceeding:

(a)   Send a notice to fine the registered proprietor under Section 127(1A) and through issuing Form 7E which the fine is less than RM500 and RM100 for each day breach continues

(b)   Send a notice to remedy the breach under Section 128

(c)    Hold an enquiry to forfeit the land under Section 129

Section 127(1A) states that the LA may impose fine first instead of instituting forfeiture action by issuing Form 7E on the proprietor to show cause why a fine should not be imposed upon him in respect of such breach. Based on this provision, the LA may send Form 7E to Zikri so Zikri must satisfy the LA on why he should not be fined even he has breached the express conditions. If he failed to satisfy the Land Administrator, they will make an order for the payment of fine amounted to not less than RM500 and RM100 in the case of a continuous breach for each day. After the expense of a fine is paid, no forfeiture action shall be taken under Section 128 or 129. However, if the breach continues, according to Subsection (1c), Zikri will be served a notice in Form 7F informing him of action under Section 128 or 129, upon the expiry of a period of six months from the date of service of the notice or any time.

Another way is by Section 128 is regarding action to secure remedying of breach of condition where any alienated land is liable under s. 127 to forfeiture to the State Authority (SA) for breach of any condition and it appears to the LA that such breach capable being remedied by the proprietor within a reasonable time. This section asserts that the LA will serve a notice Form 7A specifying the action required for fixing the breach and calling upon Zikri to take such action within the time therein specified. After Zikri has complied with the notice and refer back to the LA, they shall endorse on the Register Document of Title (RDT) the service of the notice and if notice complied, endorsement cancelled and if notice not complied, it will be forfeiture with section 129.

Next, upon breach of the notice under s 127 or 128, the LA may proceed withholding an enquiry to forfeit the land under s 129 of the NLC. First, the LA will issue a notice in Form 7B on the registered proprietor, and a copy of the form will send to the persons and bodies under subsection 98(1). By this means, the notice will require an appearance by Zikri before the LA on the date and time stated in Form 7B. On the said date, LA will hold an enquiry as to why Zikri’s agricultural land should not be forfeited. LA will have three courses of action (1) if Zikri has remedied the breach, LA will declare so by order and will cancel the note endorsed on the title that the land is subject to an action for breach of condition or (2) LA may give more time to remedy the breach and make an order specifying the action to be taken to remedy the breach and the time within (3) if directed by the SA, the LA may take temporary possession of the land. Without such directions, LA will declare the land forfeit to the SA. Further, the forfeiture only comes into effect upon publication of the Notification of Forfeiture in Form 8A in the Government Gazette according to s. 130(1) NLC.

Consequently, in the event of a breach of the express provisions committed by Zikri, the Land Administrator has the right to act against him pursuant to Section 127 for a fine or Section 128 to secure a remedy for a breach of condition, and in the event of a breach of the notice by those two, LA may proceed to hold an enquiry pursuant to Section 129 concerning the forfeiture of the land.

In conclusion, the land may be forfeited by the State Authority under section 127 of NLC due to Zikri’s act of breaching in the respect of express conditions when fail to cultivate the land and leaving the land idle for more than five years.

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SKS Bhd. is a registered proprietor of an industrial land in Seri Kembangan, Selangor. The land was held under a 60 years lease (qualified title). There are two express conditions on the title. First, this land is to be used solely for erection of a factory and second, to be used for light industries. SKS Bhd. rented out the land to a urea company that used a portion of the land to store industrial chemicals and fertilisers. Later, the Land Administrator found out that and deemed such use of land as a breach of the conditions and issued a notice requiring SKS Bhd. to remedy the breach within one month. SKS Bhd. disagreed with the notice of remedy as there is no specific prohibition to use the land as a store. SKS Bhd. consults you for advice.(10 marks)

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1. Please divide into groups to answer these questions
2. This platform is aimed for discussion, question and answers, students can give opinion as well.
3. Be creative, you can insert any information, case law, photos etc to support and illustrate your answers
All the best !

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Zikri was alienated a 20-acre plots of agricultural land in Taiping, Perak by the State Authority of Perak around five years ago. On his Issue Document of Title, there are two express conditions which states that the land can only be used to cultivate palm oil trees and that the cultivation must be done within two years of the land being alienated to Zikri. Despite it being more than five years since the land was alienated to Zikri, Zikri has left the land idle. Zikri wishes to know if the Land Administrator can take any action against him and the land for leaving the land idle all this while.(10 marks)

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Pak Samad was alienated with a piece of agricultural land in the Mukim of Gombak, Selangor. He was issued with a land title which states “Hakmilik Sementara (H.S.M) 1046, Mukim Gombak”. To his surprise, it was stated that he was permitted to use only six metres of the underground land. He was suspicious with the words “Hakmilik Sementara” and would like to know whether the land really belongs to him. He was also in doubt whether the State Authority is permitted to impose such restrictions upon landowners since he understood that whosoever owns the land, he owns it up to the limitless sky and down to the centre of the earth.Advise Pak Samad.(17 marks)