Layau Brayan v Silly@Lawrence Ak Manggat (Q-02(NCVC)(W)-1364-06/2018)

Silly @ Lawrence Ak Manggat (WNKP 511101-13-5655) … 1st Defendant

All unknown persons in occupation Of all that parcel of land situated At Kampung Tabuan Dayak described As Lot 2767 Block 1, Muara Tebas Land District … 2nd Defendant JOINTLY TRIED WITH THE MATTER IN THE SESSIONS COURT IN SABAH AND SARAWAK AT KUCHING SUIT NO.: KCH-A52NCVC-59/10-2017 2 Silly @ Lawrence Ak Manggat (WNKP 511101-13-5655) … Plaintiff And Layau Brayan (WNKP: 621019-13-5688) … Defendant CORAM: LAU BEE LAN, JCA HAS ZANAH BINTI MEHAT, JCA LEE HENG CHEONG, JCA INTRODUCTION [1] This is an appeal filed by the appellant against the decision of the High Court Judge dated 24.5.2018, in respect the above Originating Summons No. KCH-24NCVC-22/9-2017 (“the above Originating Summons”) and Kuching Sessions Court case No. KCH-A52NCVC-59/10-2017 (“the above Sessions Court Case”) which were tried together, by consent. [2] For the purposes of this appeal, the parties shall be referred to as they were at the Court of Appeal. [3] We have heard and unanimously allowed the appeal. Our reasons are as follows. 3 THE SALIENT FACTS [4] It is not in dispute that the late Bahayan anak Changan alias Brayan anak Changgan (“the late Brayan”) was the owner of a parcel of Native Area Land which was issued with a land title on 4.3.1986 described as Lot 2767 Block 11 Muara Tebas Land District (“Land”). The late Brayan is the father of the appellant. [5] After the late Brayan passed away, the Land was transmitted to his son as the representative of the estate of the late Brayan vide a transmission registered on 18.8.1988. The Land was then transferred to the appellant on 25.6.1991 as the beneficiary of the estate of the late Brayan. Since then the appellant is the registered owner of the Land. [6] It is also not in dispute that in 1978, the respondent built his house on a portion of the Land with the knowledge and consent of the late Brayan and that the respondent subsequently made improvements to the house. The respondent contended that he paid RM3,500.00 to the late Brayan for surrendering a portion of the Land whereas the appellant contended that his late father only allowed the respondent to temporarily stay on the portion of the Land at no cost, with good will and as a licensee. [7] On 7.9.2017, the appellant as the registered proprietor of the Land, initiated the above Originating Summons pursuant to Order 89 of the Rules of Court 2012, in the High Court to evict the respondent as well as other unknown people on the Land and for inter alia possession of the Land. 4 [8] In response, on or about 4.10.2017 the respondent filed the above Sessions Court Case by way of a Writ action against the appellant. The respondent sought to set aside the appellant’s title to the Land. Alternatively, the r e s p o n d e n t sought an order that the relevant portion of the Land, be transferred to the respondent and that the appellant’s title in the Land, be amended to reflect the same. The appellant counterclaimed on inter alia grounds of indefeasibility of title, trespass, recovery of possession of the Land, demolition of building structures thereon, damages, and costs. [9] Both parties mutually agreed to have both the above Originating Summons and the above Sessions Court Case jointly tried by the High Court, with only three (3) issues for determination namely: “1. Whether the Respondent had acquired beneficiary rights over the said Land by reason of prolonged occupation or representation

Whether the Appellant’s title take precedent over [the Respondent’s beneficiary rights over the said Land

Assuming issue 2 is decided in favour of the Appellant, whether by maintaining his house thereon, the Respondent had committed trespass, and if he is found so, what is the appropriate period.” (See: Consent Order at pp. 44-45 Record of Appeal and the Agreed Issues to be Tried at p. 121 Record of Appeal.) 5 [10] At the end of the trial in the High Court, the Learned High Court Judge gave judgment as follows:- “(1) The Plaintiff, Silly @ Lawrence Anak Manggat, had failed to prove that he is entitled to the portion of land in the sense that it should be transferred to him because he paid RM3,500.00 for it but as a licensee coupled with an equity which entitled him to stay and remain in the land.;

The caveat should be removed upon the expiry of 30 days.

The Defendant, Layau Anak Brayan, had failed to prove that she is entitled to recover possession of the portion of land on which the house was built or to demolish it.

The Defendant, Layau Anak Brayan, had failed to prove trespass or for recovery of loss or earnings from the rental of the house.

Each party to pay its own costs and to pay the allocator in equal shares.” [11] The appellant being aggrieved by the decision of the learned High Court Judge lodged this appeal against that part of the judgment of the learned High Court Judge which ordered that the r e s po n d e nt , be allowed to remain indefinitely on the Land. 6 FINDINGS OF THE HIGH COURT [12] Based on the Statement of Agreed Issues for Trial, the learned High Court Judge found that the issue for trial is whether the r e s po n d e nt had acquired beneficiary rights over the Land by reason of prolonged occupation and representation as stated in the Statement of Agreed Issues for Trial. In essence, the r e s po n d e nt claims to be entitled to a portion of the Land on which his house was built and for the title of the Land, to be amended by ordering the appellant to transfer it to the r e s po n d e nt . There was nothing in writing between the r e s po n d e nt and the late Brayan. The r es p on d e nt is not relying on an oral agreement nor is the re sp o n d en t relying on express or implied contract but on equitable estoppel. [13] The learned High Court Judge held that the r es p o nde n t had failed to prove that he paid the sum of RM3,500.00 to the late Brayan, in consideration of surrendering the portion of land to the r e s po n d e nt . The late Brayan had passed away and is not able to refute this allegation. The appellant is also unable to refute this allegation because she was working in Saratok, Sarawak for many years and has no personal knowledge of what transpired between her late father and the r es p ond e n t . [14] The learned High Court Judge also found that e ven if no receipt or writing was given at the time of payment, subsequently the r e s po n d e nt could have and should have asked for a receipt or writing to establish at least the fact of payment, if not, the fact that the late Brayan had surrendered or 7 sold a portion of the Land to him. [15] Apart from the testimonies of the r es p o nd e nt and his wife, the res po n de n t did not call any community leader or witness to substantiate what they had alleged. Since 1978, the r e s po n d e nt did not ask and did not produce any receipt, writing or document to establish the fact that he had paid RM3,500.00 to the late Brayan in 1978 and that this sum was for the late Brayan to surrender, sell or transfer the said portion of land to the r es p on d e nt as promised. Further, since then he did not complain to his ketua kampung or instructed his solicitor to prepare an agreement or to demand for the portion of the Land as promised to be given or transferred to him. From 1978 to 1986 or from 1978 until 2006, the r es p o nd e nt did not do anything to protect his interest in the land until the appellant asked him to vacate the Land. These raised doubts on t h e r e s p o n d e n t ’ s claim that he paid RM3,500.00 to the late B r a ya n t o surrender a portion of the Land to him, as promised. On t h e evidence, the learned High Court Judge f o u n d t h a t t h e r e s p on d e nt has failed to prove his claim as such. [16] The learned High Court Judge also found that based on the fact that since 1978, the r e sp o n d en t had spent money and built his house on the portion of the Land, subsequently made improvements to the house and had occupied the house with his family with the knowledge and consent of the late Brayan, and with the knowledge of the appellant. Thus the r es p on d e n t had the expectation to stay and to remain on the Land. These 8 raise an equity in favour of the r e spo n d e nt as a licensee to entitle him to stay and he has a license coupled with an equity. Thus the learned High Court Judge held that the court will not allow that expectation to be defeated a s it would be inequitable to do so. see Inwards and Others v Baker [1965] 2 Q.B. 29. [17] The learned High Court Judge further found that the appellant with the knowledge as stated above, is like a purchaser or transferee who took the land from the owner with notice of the r es po n d e nt ’s interest in the house and the said portion of the Land and would be bound by the equity. Therefore the re s po n d e nt is not a trespasser and did not commit trespass. [18] For the reasons given, the learned High Court Judge held that the r es p o nd e nt has failed to prove that he is entitled to the portion of t h e L and in the sense that it should be transferred to him because he paid RM3,500.00 for it but as a licensee coupled with an equity which entitled him to stay and remain in the land. The caveat should be removed upon the expiry of 30 days. Similarly the appellant has failed to prove that she is entitled to recover possession of the portion of the Land on which the house was built or to demolish it. The appellant has also failed to prove trespass or for recovery of loss of earnings from the rental of the house on the Land. 9 OUR DELIBERATIONS AND FINDINGS [19] We were mindful of the limited role of the appellate court in relation to findings of facts made by the court of first instance. In the case of Lee Ing Chin v. Gan Yook Chin & Anor [2003] 2 CLJ 19; [2003] 2 MLJ 97 the Court of Appeal held as follows: “ ….. an appellate court will not, generally speaking, intervene unless the trial court is shown to be plainly wrong in arriving at its decision. But appellate interference will take place in cases where there has been no or insufficient judicial appreciation of the evidence.” (Emphasis added) [20] Reference is also made to the decision of the Federal Court in Gan Yook Chin & Anor v. Lee Ing Chin & Ors [2004] 4 CLJ 309 where the Federal Court held that the test of "insufficient judicial appreciation of evidence" adopted by the Court of Appeal was in relation to the process of determining whether or not the trial court had arrived at its decision or findings correctly on the basis of the relevant law and the established evidence. [21] Bearing in mind the above principles, we will now c o n s i d e r the appellant’s appeal. [22] The learned High Court Judge held that the respondent had “a license coupled with an equity”, based on the fact that the respondent had made improvements to, and occupied the portion 10 of the Land with the knowledge and consent of the Deceased, and the knowledge of the appellant. We find that this is not correct as any representation, consent and/or knowledge, if any, was made by the late Brayan to the respondent and not by the appellant who became the registered proprietor of the Land by virtue of a transmission after the demise of the late Brayan. Thus the appellant, as a third party is not bound by such representation or knowledge or consent on the part of the late Brayan. [23] We also find that the learned High Court Judge’s finding that since 1978, the r es po nd e n t had spent money and built his house on the portion of the Land, subsequently made improvements to the house and had occupied the house with his family with the knowledge and consent of the late Brayan, and with the knowledge of the appellant, to be faulty and contradictory as the learned High Court Judge had earlier held that the appellant is also unable to refute this allegation because she was a w a y , working in Saratok, Sarawak for many years and has no personal knowledge of what transpired between her late father and the respondent. LICENSEE [24] Since the learned High Court Judge found that the respondent had not proven on the balance of probabilities that he paid the “token” sum of RM3,500.00 to the late Brayan, the respondent must be taken to be a gratuitous licensee who is no different from that of a temporary occupation licensee. The interest of such 11 licensee is not a registrable interest under the Sarawak Land Code. A license in connection with land, while entitling the licensee to use the land for the purposes authorised by the license, does not create an estate in the land [25] Guidance can be found in Ahmad Shazilly bin Ismail Bakti v Nik Salma Zaidah binti Hj Wan Mohd Zaid [2014] 5 CLJ 817 where the facts of the case is quite similar to the present appeal. The Court of Appeal in this case quoted with approval, a passage from Teo Bee Ann & Anor v Goh Say Dock & Anor [2010] 9 CLJ 238 as follows:- “It is trite that a license does not create any interest and is not an interest in land. It is only a personal obligation and would not be enforceable against third parties. It is equally worthy to note that the said agreement is not registered against the title deed of the said land in the relevant Land Office. As such, whatever license the first defendant is claiming over the said portion of the land is void and unenforceable against the subsequent registered landowners of the said land whose title is indefeasible save for those cases where there has been fraud, misrepresentation, forgery or an ultra vires acquisition purporting to have been made under statutory authority.” (Emphasis added) 12 [26] Since the respondent’s position is that of a bare/gratuitous licensee, which “license” can be terminable at will and which license was duly terminated when the appellant gave notice to the respondent, to vacate the Land. [27] In Toh Kheng Heng & Anor v Ahmad Fauzi bin Mohd Taufek [1994] 1 MLJ 356, the defendant claimed to occupy the land with his parents with the consent of the landowner at the time. The defendant pleaded that he had an equitable right to occupy land and in support, he also annexed bills for electricity and water, and notices of assessments. The defendant had also moved away from the disputed land. The court held that once a notice to quit had been served on him, the defendant’s capacity to occupy the land was terminated. The court then went further to hold at p. 336, paras E-G as follows: “… even if the defendant in the present case were to claim that he was occupying the land by virtue of the consent which had been given to his parents, his right to occupy the land came to an end when he gave up possession of the land, by moving away in 1985. On his return in 1988, his resumption of occupation of the land was as a trespasser, or at best, a gratuitous licensee whose interest was terminable at will. There was no agreement or understanding of any sort between the defendant and the plaintiffs’ predecessors in title, or between the defendant and the plaintiffs whereby 13 he was allowed to come on the land in 1988 and occupy it.” (Emphasis added) [28] In so far as the learned High Court Judge’s reliance on the English case of Inwards v Baker [1965] 2 QB 29, which speaks of the equitable right of expectation upon inducement to spend money and occupy the premises, we find that this case can be distinguished from the appeal before us. The facts of the present appeal is that the respondent contended that he paid the sum of RM3,500.00 to the late Brayan, in consideration of surrendering the portion of land to the r es p o nde n t a n d t h at h e had spent money and built his house on the portion of the Land, subsequently made improvements to the house and had occupied the house with his family with the knowledge and consent of the late Brayan and with the knowledge of the appellant. [29] Further the respondent admitted that he and his family moved away from the Land and into another different village. This is what he testified: “Q11: Can you tell the Court what happened after that? [1] In or about the year of 1984, after I had resigned from my employment in Singapore, my wife and I decided to start up a small business of tuck shop to support our family. 14 We decided to choose a spot at a settlement area at Sungai Apong, Kuching. [2] Initially we would travel back and forth from our home at Tabuan Dayak to Sungai Apong However, due to the distance and the need to take care of our growing business then, we decided to construct a small shelter at Sungai Apong, where we regularly stayed until 1990. Within the said period, the Tabuan Dayak home was occupied by my eldest son (who was in primary school then) and my sister in law who was looking after our son. [3] When we were given one free lot at Kampung Stampin Baru, Kuching, we vacated our Sungai Apong house and built a new house at Kampung Stampin Baru, where we moved in the year 1990 with our entire family who had earlier on remained at the Tabuan Dayak House.” (See: Witness Statement of PW5, pp. 163-164 Record of Appeal) [30] From the above, we find that the respondent have abandoned the Land and his right to occupy the Land ceased upon his abandonment of the same. Thus any equitable rights created, ceased. In the light of the above facts, we find that the case of Inwards v Baker supra do not apply to the present appeal. 15 INDEFEASIBILITY OF TITLE [31] The Land was transferred to the appellant on 25.6.1991. Since then, the appellant became the registered proprietor of the Land. [32] Under sections 131 and 132 of the Sarawak Land Code, there are express provisions for the followings:- [a] “131. TITLE GUARANTEED TO REGISTERED PROPRIETOR No title or right to land included in the Register shall be acquired by possession or user adversely to, or in derogation of, title of the registered proprietor holding direct from the Government.” [b] “132. INDEFEASIBILITY OF TITLE “(1) Subject to this Code, the registered proprietor of any estate or interest in land to which this section applies shall, except in the case of fraud, hold such estate or interest subject to the interests noted on the Register but free from all other interests except:

The estate or interest of a proprietor included in the Register in priority to the title under or through which the first mentioned registered proprietor claims, being an estate or interest to which this section applies;

As regards any portion of land included in the issue document of title by virtue of a wrong description: Provided that this exception shall not apply if the registered proprietor is a purchaser in good faith and 16 for value of the portion of land affected, or derives title through such a purchaser;

The implied conditions, obligations and restrictions referred to in section 32;

The interests of a tenant in possession of land for a term not exceeding 1 year;

Any charge affecting the land under any written law; and

Any easement lawfully created and subsisting on the 1st day of January 1958, or at such later date when the estate or interest affected by such easement becomes included in the Register.” (Emphasis added) [33] Section 132 of the Sarawak Land Code, expressly confers indefeasibility of title which arises upon registration in accordance with section 113 of the same Code, in the Register kept under section 112 of the Sarawak Land Code. The learned author of Halsbury’s Law of Malaysia, Vol 10(1), 2017 Reissue, para. [250.153], states as follows: “[250.153] Registration Under the Sarawak Land Code, every Registrar must keep a Register in such form as may be prescribed and must record therein particulars of all instruments, dealings and other matters required to be registered or entered on the Register. Registration occurs when the particulars of the transaction, together with the name of the person entitled to the interest, have 17 been entered on the Register and the entry has been signed by the Registrar; provided that any grant, lease or provisional lease of State Land will also be deemed to be registered as soon as one part of such grant or lease, duly completed, is permanently annexed to, or forms part of, the Register [Sarawak Land Code s. 113]. The registered proprietor is the person named in the grant, lease or other instrument [Sarawak Land Code s. 115]. Registration gives an indefeasible title. [See Kuching Plaza Sdn Bhd v Bank Bumiputra Malaysia Bhd [1991] 3 MLJ 163. See also Chew Slang fin v Lau Chee Ching (unreported, 15 December 2000; Suit No 22-01-95), [2000] MLJU 771]. Registration creates a new title directly from the State, rather than a derivative title from the last registered title [Sarawak Land Code s.119]” (Emphasis added) [34] Thus, by virtue of section 132 of the Sarawak Land Code, the appellant as the registered proprietor of the Land, enjoys indefeasiblity of her title in the absence of any allegations of fraud advanced by the respondent. As such, the appellant’s r e g i s t e r e d rights, title and interest prevails over all other encumbrances including the respondent’s purported interest in equity. [35] Further support can be found in the Federal Court case of TH Pelita Sadong Sdn. Bhd. v TR Nyutan ak Jami & Ors and other appeals [2018] 1 MLJ 77, which dealt with inter alia the applicability of the doctrine of the indefeasibility of title of land to 18 the Sarawak Land Code. This is what the Federal Court held: “(1) Indefeasibility of title of the land prevailed over a NCR claim. A NCR claim without title should not be put on a better footing with differential treatment. A claim for NCR and indefeasibility of title exist side by side. The disputed lands were converted to registered entities even before the plaintiffs succeeded in their NCR claim. In the absence of vitiating factors under s132 of the Sarawak Land Code, the first and second defendants’ rights as leaseholders, and the first and second interveners’ rights as proprietors and the third intervener’s right as chargee could not be defeated by the plaintiff’s NCR. ( s e e p a r a s 4 0 – 41) …

The Legislature of Sarawak has prescribed a statutory remedy for any person who is deprived of any land but barred from bringing an action either against the registered proprietor on account of indefeasibility of title or against the government for the recovery of that land, to seek compensation from the government, under s 197 of the Sarawak Land Code. The proper remedy for infringement of NCR as a result of the issuance of title or alienation of NCR, where such rights subsist without extinguishment was an award of damages and 19 not a declaration to nullify the title issued or the rectification of such title issued to third parties (see paras 50 & 58)

A native customary right claim does not overrule or prevail over the indefeasibility of title of land especially when the interest stated in the issue document of title was issued before NCR was asserted. The third intervener’s right as charge, could not be defeated by the plaintiff’s claim to native customary right in the absence of any evidence of fraud…” (Emphasis added) [36] Based on the above authorities, our respectful view is that the appellant as the registered proprietor of the Land, has an indefeasible title which prevails over the respondent’s claim in equity, in the absence of any allegation of fraud. We further find that the learned High Court Judge in his Grounds of Judgment has failed or omitted to consider the express provision of section 132 of the Sarawak Land Code and that such omission or failure is faulty and incurable. CONCLUSION [37] Based on the abovementioned reasons, this appeal is unanimously allowed with costs and the Order of the High Court dated 24.5.2018 is set aside in part with respect to 20 Orders 1, 3 and 4 of the High Court Order and each party is to bear its own costs. Dated: 16 March, 2021 sgd (LEE HENG CHEONG) Judge Court of Appeal Malaysia Counsel/Solicitors For the appellants: Clarice Chan Messrs Baru Bian, 31& 32, Level 2, Block C, Emporium, Jalan Tun Jugah, 93350 Kuching, Sarawak. For the respondent: Francis Teron Kadap (Natalie Woon with him) Messrs. Francis Teron Kadap & Co., Level 1, Lot 3140, Block 10, Kuching Central Land District, Jalan Laksamana Cheng Ho, 93550, Kuching, Sarawak.