Siow Hon Peng v Permodalan Negeri Selangor Berhad (BA-12ANCvC-49-10/2024)

PERMODALAN NEGERI SELANGOR BERHAD

MENTERI BESAR SELANGOR (PEMERBADANAN) …RESPONDEN-RESPONDEN [DALAM MAHKAMAH SESYEN DI SHAH ALAM DALAM NEGERI SELANGOR DARUL EHSAN GUAMAN NO.: BA-A52NCvC-381-12/2023 ANTARA SIOW HON PENG (NO. K/P: 660211-05-5225/A0365038) …PLAINTIF 28/04/2025 09:38:10 BA-12ANCvC-49-10/2024 Kand. 21

PERMODALAN NEGERI SELANGOR BERHAD

MENTERI BESAR SELANGOR (PEMERBADANAN) …DEFENDAN-DEFENDAN] GROUNDS OF JUDGMENT [1] This is an appeal by the Plaintiff/Appellant against the decision of the Sessions Court to strike out the claim against both Defendants/ Respondents in the Court below. This Court heard and dismissed the appeal. In these brief grounds, I refer to the parties as they were in the Court below. [2] The facts of this case are straightforward and quite unfortunate for the Plaintiff:

The Plaintiff signed a sale and purchase agreement on 5-7- 2001 (“SPA”) to purchase a double-storey terrace house in a housing project known as Alam Perdana (Phase 1), Bandar Puncak Alam (“Project”) for RM154,620.00 (“Property”). The SPA was signed with the developer, Vega Builders Sdn Bhd (“Vega”), and the proprietor of the Project land, LBCN Development Sdn Bhd (“LBCN”).

The Project was abandoned in 2006 after the Plaintiff had paid the full purchase price for the Property in June 2003. The Selangor State Government acquired the Project land under the Land Acquisition Act 1960 on or about 17-12-2009 as gazetted in Gazette No. 4183. That process concluded and compensation monies were paid in or around November 2011 to LBCN.

The Selangor State Government then appointed the 2nd Defendant to revive the Project, and the 1st Defendant was appointed by the 2nd Defendant as the Project manager. The Plaintiff was not notified as a person interested in the land acquisition. [3] On 21-12-2023, the Plaintiff sued the Defendants as alleged successors in title and permitted assigns of Vega and LBCN in the SPA, seeking a declaration that it is the lawful owner of the Property and that the Defendants hold the Property as bare trustees and/or constructive trustees for the Plaintiff, an order for specific performance of the SPA and payment of 10% LAD amounting to RM186,190.25 or such other sum as may be ordered. The Sessions Court struck out the claim summarily on the application of the Defendants grounds that:

the Defendants are not successors in title of Vega and LBCN and are not bound by the SPA;

the Plaintiff’s beneficial interest in the Property had been extinguished by the land acquisition; and

the Plaintiff’s claims are time-barred. [4] A preliminary issue was also raised at the hearing of appeal that the Plaintiff had mistakenly filed the underlying suit at the Sessions Court, and the remedies sought are those that the Sessions Court does not have jurisdiction to grant. Accordingly, it was urged upon this Court that in the interest of justice, the appeal should be allowed so that the case can be transferred to the High Court to be determined on its merits. [5] The legal basis for this preliminary issue raised is sections 69 and 71 of the Subordinate Courts Act 1948 (“SCA”): Section 69 “Sessions Courts shall have no jurisdiction in actions, suits or proceedings of a civil nature-

relating to immovable property except as provided in sections 70 and 71; …

to enforce trusts…” Section 71 *If in any action or suit before a Sessions Court, the title to any immovable property is disputed, or the question of the ownership thereof arises, the Court may adjudicate thereon if all parties interested consent; but, if they do not all consent, the Sessions Court Judge shall apply to the High Court to transfer the action or suit to itself. [6] This Court found that save as a claim by a beneficiary under a trust within the meaning of section 22(1) of the Limitation Act 1953, the Plaintiff’s claims are hopelessly time-barred. However, the Plaintiff chose to file this action at the Sessions Court and the Defendants did not object to jurisdiction, and so it must be deemed that the parties consented to submit to the jurisdiction of the Sessions Court. It is too late in the day for the Plaintiff to raise an objection as to jurisdiction. [7] In respect of section 69 of the SCA, the Sessions Court determined that to the extent that the Plaintiff was alleging the existence of a constructive trust over the subject Property by reason of the Plaintiff having fully paid for it in full before it was taken over by way of the land acquisition years later, the Sessions Court had no jurisdiction over the matter. [8] In respect of both the jurisdictional and substantive questions determined by the Sessions Court, this Court found no error. The central plank of the Plaintiff’s case appears to be that the Defendants are successors in title and permitted assigns of Vega and LBCN and so the SPA and all equities attached thereto are enforceable against them in like manner. The Plaintiff was mistaken on both counts. [9] As a matter of law, devolution of title via land acquisition does not have the same effect on third-party interests as a private sale of land. The process extinguishes all in rem rights and provides only for monetary compensation. The Plaintiff was not vigilant and sat on available rights of recovery against Vega who breached the SPA and, more importantly, LBCN who received the compensation in the land acquisition. [10] Even if it had been a private sale of land by LBCN to the Selangor State Government, the equitable constructive trust that gives a buyer the right to claim title to a fully paid property cannot defeat the rights of a subsequent registered proprietor who takes title free of any unregistered encumbrances in the Torrens land system. Thus, a buyer like the Plaintiff would have only been left to enforce any available in personam rights against Vega and LBCN and/or their successors in title. [11] In this case, the Defendants are contractual appointees of the State Government of Selangor who, as the new proprietor of the Project land, was not named in the suit. The Defendants are separate corporate entities from Vega and LBCN and there was no assignment or novation of any rights and obligations attached to the SPA to either Defendant. Thus, the successor-in-title clause did not have the effect of compelling strangers like the Defendants to step into the shoes of Vega and LBCN based on the doctrine of privity of contract. [12] Despite the apparent injustice to the Plaintiff, the law must be applied correctly. It would be an exercise in futility to contemplate reviving and transferring the case to the High Court since the case as pleaded by the Plaintiff do not set up the Defendants in any way as parties that can be burdened with a constructive trust. [13] For the above reasons, this Court dismissed the appeal and affirmed the decision of the Sessions Court with costs of RM5,000.00. Bertarikh : 28 April 2025 ELAINE YAP CHIN GAIK PESURUHJAYA KEHAKIMAN MAHKAMAH TINGGI MALAYA SHAH ALAM Peguam Untuk Perayu: Ravinder Singh Sodhi A/L Manmohan Singh Sodhi, Messrs Gurmit Sodhi Chambers Untuk Responden-Responden: Jasneeta Kaur Bhullar (with Janice Chan Chee Teng),