Shahrel Azizi bin Saad v Harun bin Ramli (KA-22NCvC-7-02/2024)

This case was heard together with another Civil Action No. KA- 22NCvC-6-02/2022. Both cases are identical in terms of facts and witnesses and only differ in respect of the registered owner of the property in the disputes.

In this action, the Defendant is sued in his capacity as the administrator of the estate of Ramli Bin Hanafiah, the registered 24/12/2025 14:46:42 KA-22NCvC-7-02/2024 Kand. 23 proprietor of a land under title no. 432, Lot 2788, Mukim Derang, Kampung Bukit, Daerah Pokok Sena, (formerly under title P.T. 376, HS(M) 226), Kedah Darul Aman) (HSM 226) whereas in suit no. KA- 22NCvC-6-02/2024, the Defendant is sued as the owner of the property known as Lot PT 375, HS(M) 227, Mukim Derang, District of Pokok Sena, Kampung Bukit, Kedah Darul Aman (HSM 227).

In this action the Plaintiff as the administrator of the estate of Saad bin Man filed a claim against the Defendant and seeks, among others, for an order compelling the Defendant to transfer ownership of properties HSM 226 and HSM 227 to the Plaintiff as the administrator of the Estate of Saad bin Man. It is the Plaintiff’s case that Saad bin Man had purchased the repetitive property: HSM 226 for the consideration of RM80,000.00; and property HSM 227 for the consideration of RM120,000.00.

The Defendant in both cases disputed the Plaintiff’s claim and took a diametrically opposite position. In the Statement of Defence the Defendant had, in its core, taken the stand that the entire dealing between the parties was not that of a sale but a money lending transaction secured by way of a charge over the property. To buttress the point, by way of Counterclaim, the Defendant prays for declarations that:

the time for the deceased and/or the Plaintiff to enforce rights as mortgagee has lapsed and is incapable of enforcement;

(ii) the Defendant, as mortgagor, has reacquired the interest as registered proprietor of the property;

(iii) the Power of Attorney dated 13 June 2000 executed by the Defendant in favour of the deceased is incapable of enforcement; and

(iv) the loan advanced by Saad Bin Man was unlawful and unenforceable.

The hearing proceeded with the Plaintiff giving evidence on his own behalf and the Defendant likewise testifying. Having considered the pleadings and the evidence, I allowed the Plaintiff’s claim and dismissed the Defendant’s Counterclaim.

Dissatisfied, the Defendant filed a notice of appeal dated 27.10.2025.

The following are my grounds in arriving at my decision.

The Plaintiff is the administrator of the estate of Saad bin Man, now deceased. During his lifetime, the deceased purchased two parcels of land, namely HSM 226 and HSM 227. A Sale and Purchase Agreement dated 13.06.2000 (“the SPA”) was executed between the deceased as the purchaser. HSM 226 was purchased for the price of RM80,000.00 and HSM 227 for the price of RM120,000.00. It is not in dispute that the deceased had fully paid amount stated to be the purchase price for both properties. The Plaintiff case

At the time of entering into the Sale and Purchase Agreement (SPA), the transfer of ownership could not be effected as there was a restriction on the respective property prohibiting any dealings except by way of charge within a period of ten (10) years calculated from the date of registration of the title of the property save with the consent of the State Authority.

Based on the date of registration of the title for property HSM 226, which was on 25.10.2007, the ten‑year restriction on transfer expired on 24.10.2017. As for property HSM 227, the date of registration of the Title was on 31.05.2000, and the ten‑year restriction on transfer expired on 30.05.2010.

It is also not in dispute that possession to the respective property was given to the deceased. In view of the restriction stated earlier no instrument of transfer could be affected. The Plaintiff contended that the parties went about agreeing that the instrument of transfer will be done after the expiry of the ten years period and in order to safeguard the purchaser’s interest, a charge dated 13.06.2000 was created naming Saad Bin Man as the chargee.

Clause 3 of the SPA serves to confirm the ownership of the deceased. It reads as follows:

Penjual dengan ini serah milik Tanah Tersebut hendaklah kepada Pembeli dan Pembeli mulai hari ini boleh masuk memerintah Tanah Tersebut sebagai haknya dan mengutip semua perolehan daripada hasil Tanah Tersebut.

In addition, and to further affirm the deceased’s ownership of the two properties, a Power of Attorney dated 13.06.2000 was granted to Saad bin Man which was duly registered at the High Court of Alor Setar, Kedah. Clause 7 of the Power of Attorney empowered Saad bin Man to sell, re‑mortgage, and transfer the said properties to the purchaser, being Saad bin Man himself. That Clause for convenience reads as follows:

Untuk saya dan atas nama saya, PEWAKIL boleh jual, gadai semua Tanah Tersebut pada bahagian saya sahaja kepada mana-mana pembeli atau pemegang gadai dan juga PEWAKIL boleh memindahmilik semua Tanah Tersebut kepada namanya sendiri mengikut sepertimana syarat-syarat yang tercatat di dalam Surat Perjanjian di antara saya dengan beliau pada 13 haribulan Jun 2000. The Defendant case

The Defendant denies having entered into a Sale and Purchase Agreement with the deceased. Instead, the Defendant admits to having charged the property to the deceased as security for a cash loan amounting to RM80,000.00 in respect of HSM 226 and RM50,000.00 in respect of HSM 227.

The Defendant further contends that the loan amounts recorded in Charge Form 16A, namely RM120,000.00 for HSM 226 and RM80,000.00 for HSM 227, do not represent the actual loan sums but include interest imposed by the deceased on the loan, and that the actual loan monies received were RM60,000.00 (HSM 226) and

The Defendant also admits to having executed the Power of Attorney, asserting that it was a condition imposed by the deceased for the granting of the loan.

The Defendant pleads by way of defence that the deceased was engaged in the business of moneylending without a license and in contravention of the law.

The Defendant further pleads that the Plaintiff’s claim to enforce the charge is barred by the limitation period of 12 years under sections 9 and 21 of the Limitation Act 1953 (Act 254).

The Defendant additionally seeks a declaration that the Power of Attorney dated 13.06.2000 is incapable of enforcement by reason of the death of Saad Bin Man, the donee of the power.

From the factual matrix set out above, it seems to me that the issues in focus which require determination are as follows:

whether the transaction ought to be regarded as a genuine sale, or whether it is in substance no more than a loan clothed in the appearance of a sale;

whether the Plaintiff’s claim is caught by the law of limitation?

From the preceding paragraphs it is apparent that the vortex of the Defendant’s case is the plea of limitation. It is submitted by the Defendant that the issue of limitation is the core issue in this case. It will determine the course of the Plaintiff’s claim. The determination of this issue will have an impact on the entirety of the Plaintiff’s claim and the Defendant’s defence.

To appreciate that argument it is necessary to put the Defendant’s case in context. Despite the existence of the SPA the Defendant argued that in reality the substance of the transaction was one of moneylending which is secured by way of a charge. As regards to the Power of Attorney the Defendant admits to having executed the same as this was required by the deceased as a condition for granting the loan. Nevertheless, the Defendant now asserts that the Power of Attorney cannot be enforced as the donee has passed away.

At the risk of repetition, the Plaintiff, on the other hand, contends that the deceased had purchased the properties and that the Sale and Purchase Agreement serves as proof of the transaction of sale and purchase.

The Sale and Purchase Agreement dated 13.06.2000 was produced in the Bundle of Documents and became part of admitted document subject to submissions. This means that the validity of the document is not in dispute.

Having considered the totality of the evidence I find that the true nature of the transaction between the parties is one of sale and not that of a loan transaction or even a moneylending deal. I came to the conclusion for the reasons that follow.

In the said SPA, recital 3 confirmed that the land was subject to a restriction for a period of ten years save for a charge. If the Defendant’s allegation were true, namely that the transaction was merely a moneylending scheme and not a sale of land, then the recital concerning the ten‑year restriction on transfer would not have been necessary, as a charge alone would have sufficed to secure the loan.

The Defendant was unable to offer any explanation for the existence of the SPA other than dithering again on the moneylending issue.

I am of the considered view that there is clearly an absence of any credible explanation or evidence for me to even consider that the SPA is a mere cloak for another transaction. I am also fortified in my finding by looking at the terms of the SPA as leading to the undeniable conclusion that the transaction entered into between the Defendant and the deceased was a sale and purchase of land. The following terms are relevant:

Acknowledgement of the restriction on dealings with the land for ten years from the date of registration of the title (Paragraph 3 Recital);

(ii) Admission by the vendor that the purchaser had paid the full purchase price of the land (Clause 2);

(iii) Granting the purchaser rights over the land, including the right to collect all proceeds from the land (Clause 3);

(iv) Granting the purchaser a Power of Attorney to sell, charge, lease, rent, or otherwise deal with the land, and to transfer ownership of the land to any purchaser after the ten‑year period (Clause 4);

In the event of death, the heirs shall fulfil the terms of the agreement (Clause 5).

With regard to the Defendant’s allegation that Charge Form 16A states “repayment of loan in the sum of …….”, I am of the view that it is a standard form and consistent with the deceased’s intention to safeguard his interest as purchaser, given the restriction of interest which prevented the deceased from effecting transfer.

The Court also finds that the Defendant’s defence is an afterthought. This is because, by letter dated 1.1.2024 at page 22 of Bundle B2, the Defendant clearly expressed willingness to surrender all portions of land under HSM 226 and willingness to surrender HSM 227 while retaining one‑third share as his own. The contents of this letter amount to an admission by the Defendant that the properties belonged to the deceased.

It is the finding of this Court that the deceased was the beneficial owner of properties HSM 226 and HSM 227.

Referring to the Plaintiff’s Statement of Claim and the relief sought, the cause of action is founded upon contract and recovery of trust property which remains registered in the name of the trustee, namely the Defendant. In the relief sought, the Plaintiff prays that the Defendant be ordered to transfer properties HSM 226 and HSM 227 to the Plaintiff as Administrator of the Estate of Saad Bin Man, the deceased.

Section 22 of the Limitation Act 1953 provides as follows: 22 (1) No period of limitation prescribed by this act shall apply to an action by a beneficiary under a trust, being an action;

In respect of any fraud or fraudulent breach of trust to which the trustee was a party or privy; or

To recover from the trustee trust property or the proceed hereof in the possession of the trustee, or previously received by the trustee and converted to his use…’

It follows from the above that causes of action for specific performance of a contract which involve or encompass the recovery of trust property by a beneficiary from a trustee is not caught by the limitation period of 12 years prescribed under section 9 (1) and 21 (1) of Act 254. (refer the case of Abdul Razak Sheikh Mahmood & Anor v. Bhupinder Singh s/o Avtar Singh & Ors [2012] 3 MLJ 348)

Since it is my findings that the Plaintiff claim was not caught by limitation and claim encompass the recovery of trust property by beneficiary from a trustee, the other submissions by the Defendant must fail. I accordingly rejected the submissions premised on either moneylending or that the Plaintiff is out of time to enforce the charge.

In the upshot the Plaintiff’s claim is allowed and the Defendant’s Counterclaim is dismissed.

Accordingly, it is hereby ordered that:

The Defendant is directed to take all necessary steps to effect the transfer of ownership of the property described as PM Title No. 432, Lot 2788, Mukim Derang, District of Pokok Sena, Kampung Bukit, State of Kedah, and Lot PT 375, Title No. H.S.

(M) 227, Mukim Derang, District of Pokok Sena, Kampung Bukit, State of Kedah, to the Plaintiff in his capacity as Administrator of the Estate of Saad Bin Man, deceased;

(ii) The Land Registrar of the District of Pokok Sena, Kedah shall take all necessary steps to give effect to the Order of this Court herein;

(iii) An injunction restraining the Defendant, whether by himself and/or his agents and/or servants or otherwise, from entering, trespassing upon, or undertaking any works on the said property;

(iv) General damages for the Defendant’s trespass to be assessed by the Court;

Cost of RM10,000.00 for Civil Action no. KA-22NCvC-6- 02/2024 and RM5,000.00 for Civil Action no. KA-22NCvC-7- 2/2024 to be paid by the Defendant to the Plaintiff subject to allocator. Dated: 23 December 2025 (Mohd Aimi Zaini Bin Mohd Azhar) Judicial Commissioner High Court Malaya Alor Setar Kedah Darul Aman Solicitors for the Plaintiff: Abdul Rahim Mohd Messrs. Tung, Chan & Partners Solicitors for the Defendants: Amnach A/L Ee Niam Messrs Amnach & Co