Tcm Mining Sdn Bhd v Naam Sdn Bhd (KA-24NCvC-185-06/2022)

The Plaintiff is the lessee of nine parcels of land on Langkawi Island, specifically including H.S.(M) 94 PT 29 (“Plot 94”) and H.S.(M) 651 PT 32 (“Lot 51”) Bandar Padang Mat Sirat, Kampung Kok, Daerah Langkawi, Negeri Kedah Darul Aman (“the Lands”).

This status is pursuant to a Lease Agreement dated 09.12.2012 (“the Lease Agreement”), entered into with the Langkawi Development Authority (“LADA”) the registered proprietor and lessor.

Under the terms of the Lease Agreement, LADA granted the Plaintiff vacant and unencumbered possession of the Lands with effect from

09.12.2012.

In about July 2016, the Plaintiff discovered that the Defendant, NAAM Sdn. Bhd., had encroached upon and was unlawfully occupying and using parts of the Lands, specifically Lot 51, and later extended its encroachment to Plot 94.

The Defendant, which operates a water sports business on “Paradise 101” (an island off Langkawi), was allegedly using the Lands as a launching base for its operations.

The Plaintiff, through its related company, Benua Perdana Sdn Bhd, issued a Notice of Demand on 12.07.2016, to Naam Sports Sdn Bhd, informing them of the encroachment and demanding that they vacate the Lands and remove their belongings immediately.

The Defendant responded via a letter dated 19.07.2016, apologizing for un-intentionally using the Lands to load and unload materials for Paradise 101 construction. The Defendant requested six months to complete the construction and pledged to vacate the Lands accordingly. An email on 21.07.2016, further sought permission to utilize the beach area.

The Plaintiff claimed the Defendant breached its promise to vacate and continued its unabated trespass, even extending its encroachment onto Plot 94.

The Plaintiff's solicitors issued another Notice of Demand on

19.05.2022, demanding immediate vacation within seven days. The Defendant allegedly failed to comply with this demand.

When the Plaintiff attempted to fence off the Lands, the Defendant physically prohibited this, issued a letter and lodged a police report on 16.07.2022. The Plaintiff asserts that these documents contained repeated admissions of the Defendant's trespass and encroachment.

Due to the Defendant's persistent and unabated trespass, its failure to vacate, and the potential for a breach of peace, the Plaintiff filed this Originating Summon (Encl. 1) (“the Application”) against the Defendant in this Court, wherein the Plaintiffs claimed for, amongst others: a) A declaratory order under Section 41 of the Specific Relief Act 1950 that the Plaintiff is the Lessee of the said Lands (specifically Plot 94 and Lot 51) pursuant to the Lease Agreement with LADA; b) An injunction immediately restraining the Defendant, their employees, or agents from trespassing and/or continuing to trespass on the Lands; c) An order requiring the Defendant to remove and/or relocate all goods, equipment, machinery, and any other property belonging to the Defendant from the Lands within seven days of the sealed Order's service; d) An order requiring the Defendant to forthwith surrender or deliver vacant possession and ownership of the Lands to the Plaintiff within seven daysof the sealed Order's service.

After the close of the affidavits, the Defendant managed to convince the former judge to allow them to cross examine the deponent of the affidavits affirmed in favour of the Plaintiff: Raja Noor Kamariah. The cross examination was then conducted before me. Thereafter I have instructed the parties to put in their submissions and replies.

The essence of the Plaintiff’s submissions is that the Defendant appeared to admit to trespass in 2016. The Plaintiff highlighted that admissions are the strongest form of evidence and cannot be ignored, and the Defendant should not be allowed to approbate and reprobate its earlier admissions. The Plaintiff cited the cases of Balbeer Singh a/l Karam Singh v Sentul Raya Sdn Bhd [2022] 1 MLJ 30 and HSBC Bank Malaysia Berhad v LH Timber Products Sdn Bhd & Ors [2005] 8 CLJ 249 to support its contention.

The Plaintiff also relied on the law relating to the contractual effect of dealings of land under s.206(3) of the National Land Code (“the NLC”). In other words, the Plaintiff argued that the non-registration of the Lease Agreement does not invalidate it or diminish its rights to vacant possession.

The Plaintiff submitted that the Lease Agreement is deemed conclusive evidence of the Plaintiff's absolute and undisputed right to possession, as the Plaintiff has complied with and fulfilled all its terms and conditions, and LADA has not alleged any default or sought to terminate the Lease Agreement.

The crux of the Defendant’s submissions was structured in the following manner: a) The Plaintiff has failed to prove its right to possession over the lands; b) The Plaintiff relied on letters taken out of context to prove alleged trespass & its right to possession; c) This Application is procedurally defective as the Plaintiff did not name LADA as a party to these proceedings; d) The Defendant has obtained rights to use the land. Decision and findings of the court

After perusing the facts adduced by the parties through affidavits and the exhibits, and the submissions by the learned counsels for all parties, I dismiss the Application with cost. Herein are my reasons.

With regards to the law of trespass, the Apex Court case of Tenaga Nasional Berhad v Bukit Lenang Development Sdn Bhd [2019] 1 MLJ 1 leaves no room for doubt as Zawawi Salleh FCJ ruled: “[23] Put simply, trespass onto land is the unlawful direct and immediate interference with the possession of land which is in the possession of another person, or which another person is entitled to possession of. A Latin maxim is frequently employed to define the extent of land: “cui us est solum, eius est usque ad coelum et ad inferos” - he who owns the land, owns it all the way to the heavens and to hell. This principle is often referred to in its abbreviated form as ad coelum principle. In modern law, this principle is still accepted in limited form, and rights are divided into space rights and subsurface rights below.” [Emphasis added]

Based on the above, in claiming for trespass, the essential elements of the cause of action are: a) The plaintiff must have actual possession or a right to possession over the land; b) The defendant must have committed direct and immediate interference over the land.

The principles governing the law of trespass are well established: trespass constitutes a violation of a possessory right. To maintain an action in trespass, the plaintiff must have been in possession at the time the alleged trespass occurred. Any form of possession, provided it is clear, exclusive, and accompanied by an intention to possess, is sufficient to sustain such a claim (See Cahaya Utama Industries Sdn Bhd v Kong Kam Peng [2007] 8 MLJ).

The Plaintiff, primarily argues that the Defendant has repeatedly and unequivocally admitted to trespassing on the Lands in question (Plot 94 and Lot 51 respectively). This forms a central pillar of the Plaintiff's case against the Defendant.

The Plaintiff supported this argument by highlighting several pieces of evidence. First, the Defendant's own letter dated 19.07.2016 (See Plaintiff’s AIS, p.91) (Encl.2) where they apologized for “unintentionally using your premises” and requested six months to complete construction, and promised to vacate the Lands accordingly.

Second, an email dated 21.07.2016 from Nathan Nadarajah (See Plaintiff’s AIR (2), p.20) (Encl.16), where the Defendant again admitted the Plaintiff's possession of the Lands and sought permission to use the beach area.

Third, the Defendant's Surveyor's plan of Lot 51, which clearly marked the “area used” and a “tent” within Lot 51, was presented as damning evidence of the Defendant's own trespass.

Further admissions were cited from the Defendant's letter dated 16.07.2022 (See Plaintiff’s AIR, pp. 70 &71)(Encl.8), and a police report by Mohammad Rizal bin Abu Hassan dated 09.07.2022 (See Plaintiff’s AIR, pp.93 & 94) (Encl.8), which made repeated acknowledgements of the Defendant's trespass and encroachment on the Lands.

From the Plaintiff's perspective, these admissions are the strongest form of evidence possible and cannot be disregarded. Learned counsel for the Plaintiff argued that the Defendant cannot approbate and reprobate by first admitting trespass and then attempting to challenge the Plaintiff's right to possession or claim an easement over the Lands, emphasizing that such conduct lacks bona fides. The Plaintiff maintained that, on this ground alone, the claim for trespass should be allowed.

In response, the Defendant argued that the exchange of letters in 2016, specifically their letter dated 19.07.2016, cannot be taken as an admission of trespass or an admission of the Plaintiff's alleged rights to possession of the Lands.

Moreover, the Defendant added that the Plaintiff’s letter dated 12.07.2016, never complained of the Defendant trespassing their land, nor did it state that the Lands rightfully belonged to the Plaintiff. Instead, the Plaintiff's stated reason for requesting the removal of machinery and construction materials was concerns about “adverse impact on the access road and beach area, and disturbance to the guests”.

The Defendant clarified that their reply merely acknowledged these complaints and not an admission of trespass. The Plaintiff's own deponent, Raja Noor Kamariah, acknowledged during cross- examination that the word “trespass” was not mentioned in the 2016 letter.

The Defendant’s learned counsel emphasized, to which 1 agree, that admissions are not conclusive if there is an explanation, citing the then Federal Court case of M A Clyde v Wong Ah Mei & Anor [1970] CLJU 73, which states that an admission cannot be regarded as conclusive, and it is open to the person who made it to explain it.

Besides, the Defendant’s assertion that the Plaintiff's 2016 letter was addressed to NAAM Sports Sdn Bhd, rather than NAAM Sdn Bhd, is not without merit. The Defendant argued that the Plaintiff bears the onus of proving the Defendant’s (NAAM Sdn Bhd's) liability for the alleged trespass. This the Plaintiff has failed to do due to the discussion at the later part of this judgment.

The Defendant contended that the essential elements of the Lease Agreement has not been fulfilled. There are at least 3 obligations under the Lease Agreement which the Defendant has alleged as proof that the Plaintiff had not fulfilled its obligation. I shall now discuss them separately. i. The Development

It is undeniable that clause 11.1(a) and 5.1(f) of the Lease Agreement required development to commence on the lands within 3 years. This means that the Plaintiff is required to develop the land within 3 years. Clause 5.1(f) and 11.1(a) of the Lease Agreement read as follows:

5.1 – If the Lessee: ...

fails to commence any construction work in respect of the Proposed Development within three (3) years of the date of this Agreement PROVIDED ALWAYS that the Lessee shall not be deemed to be in default of its obligation if such failure is attributed to any delay, refusal or rejection by Appropriate/Relevant Authorities to grant the necessary approval required for the commencement of the construction work or any other matter or work related thereto; or ... The Lessor shall be entitled forthwith to terminate this agreement ...

Clause 11.1(a) 1 – The Lessee hereby covenants with the Lessor that:

It shall not later than 6 months from the date of this Agreement: i. Submit to Majlis Perbandaran Langkawi the development layout plan and the development plan proposal in order to obtain planning approval (kebenaran merancang); and ii. Commence preliminary works relating to the proposed development on the lands.

The Plaintiff contended that the Defendant's reading and interpretation of these clauses in the Lease Agreement were selective, misconceived and erroneous. The Plaintiff clarified that the Lease Agreement was collectively for nine parcels of land, not just the disputed Lands.

The Plaintiff further contended that the Lease Agreement, specifically Recital B, indicated that the Plaintiff was desirous of leasing the Lands for the purpose of developing, constructing, and completing an integrated resort (the “Proposed Development”) with a general description and tentative timeline appended in the Second Schedule.

The Plaintiff's witness, Raja Noor Kamariah, confirmed during cross-examination that the Plaintiff had commenced development on other parcels of land under the same Lease Agreement. The Proposed Development was an integrated resort to be completed in stages.

The Plaintiff had submitted a Development Plan, which was submitted on its behalf, for the development of several parcels of land, including the Lands in question. LADA had consented to this development layout plan and proposal, and Majlis Perbandaran Langkawi had approved it on 05.03.2015.

The Plaintiff argued that their inability to develop the specific disputed Lands was “by reason of the Defendant’s trespass, unlawful occupation… and threats to breach of the peace”. The Plaintiff's efforts to fence off the Lands and commence development were thwarted by the Defendant, who allegedly threatened the Plaintiff's representatives and filed police reports.

To this, the Defendant asserted that the Plaintiff's claim of being unable to proceed with development due to losing lease period was irrelevant. The Defendant further argued that the whole issue about the Plaintiff needing to proceed with the development according to a planning permission was never raised at all in the Plaintiff’s affidavits, and therefore, no weight should be given to this issue.

The Plaintiff's claim of being prevented from fencing the land and commencing development was framed by the Defendant as the Plaintiff attempting self-help. The Defendant stated that Karan Singh, the General Manager of The Danna Hotel Langkawi (a company related to the Plaintiff), had attempted to erect a fence not on the disputed land itself, but on the road reserve adjacent to it.

The Defendant claimed that Karan Singh admitted to not having written approval from Majlis Perbandaran Langkawi Bandaraya Pelancongan for this fencing.

The Defendant themselves filed police reports on 09.07.2022 and 16.07.2022 regarding the Plaintiff's attempt to fence the Lands, alleging interference with their access. Their surveyor's plan also indicated holes drilled by Karan Singh for posts on the road reserve, not within Lot 51. Police officers and Majlis Perbandaran Langkawi Bandaraya Pelancongan officials also visited the site and commented that the fencing area was indeed a road reserve and therefore illegal to fence.

Furthermore, the land search also reveals that Lot 51 is to be used as a museum site. (See Defendant’s AIR, p.66) (Encl.8).

However, the photographs of the Lands demonstrate that no development had taken place as of the dates the affidavits were affirmed in 2022. It is evident that no museum had been constructed at that time either (See Defendant’s AIR, p.7) (Encl.8).

Additionally, the Plaintiff’s deponent also confirmed in cross-examination that no development has commenced on the Lands. [See NOP, p.29] Now, I would just finish off by confirming that. I just want to go back to the letters of 2016. Sorry I’ll just finish off there. And under the-sorry just one more point on the lease agreement it’s also contemplated that not only this land but other lands would be developed. Yes? Yes. And would you agree that those lands have not been developed. No, not all. Some have been developed. Under the terms of the lease-some have been developed? Yes. And-But not related to this particular Lot. Correct? Correct. [Emphasis added]

While this casts doubt to the Plaintiff’s case, it is my finding that these are insufficient to deprive the Plaintiff form the lease they have obtained from LADA. However, this same cannot be held for the next issue. ii. Malay Reserve Land

The most fatal issue against the Plaintiff’s case is the issue of Malay reserved land status of the Lands. Clause 8.1 of the Lease Agreement requires the Lands to be de-classified from their original status as Malay Reserve land. If not, the lease agreement will be terminated.

The Defendant averred that as at 2022, when the affidavits were filed, the Lands still remained as Malay reserve lands (See Defendant’s AIR, p.66) (Encl.8). Unfortunately, the Plaintiff's AIS did not explain or provide any evidence that the lands have been de-classified nor any evidence that the Plaintiff had been declared or recognized as a “Malay” entity under the relevant Enactment. Thus, the lease in favour of the Plaintiff is invalid and illegal.

During cross examination, the Plaintiff’s deponent agreed that there is no proof whatsoever to evidence that this requirement under Clause 4.1 had been complied with. [See NOP, p.23] Now I want to move into another area, this is regarding a condition in the agreement. I go back to the agreement. Page 43, Clause 8 ‘De-classification of the Malay Status’ and also Clause 4 at page-sorry let me go to page-Clause 4 first I’ll finish this very quickly. Page 39, I’ll just put it to you then I’ll move on. Would you agree with me also that there’s no evidence before the Court that you’ve obtained a declaration from the authorities that the Lessee be deemed to a Malay pursuant to the State of Kedah Enactment. Would you agree with that? Before the Court so I just put it to you that there’s no document that this has also been satisfied. Would you agree? Correct. Agree. [Emphasis added]

The Defendant therefore contended that this indicates that the obligation was not discharged, thereby entitling LADA to terminate the lease. On the balance of probabilities, this fact alone demonstrates that the Plaintiff did not have a right to possession at the time the action was initiated.

The Plaintiff, in response to the Defendant's argument regarding the Malay Reserve Land status and the requirement for de-classification, stated that they have obtained a declaration to be deemed a Malay company.

The Plaintiff argued that pursuant to Clause 4.1 of the Lease Agreement, the Lessee may obtain a declaration to be deemed a Malay Company. Their witness, Raja Noor Kamariah, confirmed during cross-examination that the Plaintiff has obtained this declaration from the state authority, indicating that the Plaintiff is deemed a Malay company under Clause 4.1 of the Lease Agreement. It is the Plaintiff’s case that since the Plaintiff has obtained the Malay Company declaration under Clause 4.1, the obligation for the de-classification of the Malay Reservation Status under Clause 8 of the Lease Agreement does not arise.

The Plaintiff reiterated that the Defendant is not a party or privy to the Lease Agreement and therefore does not have the right to dispute its validity or fulfilment of obligations. The Plaintiff emphasized that LADA, as the lessor, is the only party entitled to terminate or challenge the Lease Agreement, which it has not done.

Indeed, the performing or non-performing of any obligation under an agreement is the business and decision of the parties themselves. Having said that, this Court agree with the Defendant’s contention that the Plaintiff had failed to provide any documentary evidence in its affidavits or during cross-examination to prove that it had obtained a declaration from the authorities deeming it a Malay Company as required by Clause 4.1 of the Lease Agreement. The Plaintiff had never averred in any affidavit evidence that it has obtained the necessary declaration that it is a Malay company.

Learned counsel for the Defendant has rightly emphasized that, if the Plaintiff is not a Malay company, the Lease Agreement and the lease itself would be rendered void under Section 6 of Enactment No. 63 (Malay Reservations) (Kedah). Accordingly, in the absence of such a declaration, the Plaintiff would be precluded from enforcing the Lease Agreement through specific performance and would have no possessory rights over the land. I find no reason to disagree with this submission.

To add on to the restriction under Section 6 of the Enactment No. 63 (Malay Reservations) (Kedah), Section 8 has expressly prohibited dealings inclusive of leases being transaction with non-Malay or non-Siamese when it says,

No State land included in a Malay Reservation shall be sold, leased or otherwise disposed of to any person who is not either (a) a Malay; or (b) a Siamese certified by the Director in writing to be a Siamese agriculturist permanently resident in the State.” [Emphasis added]

It is undeniable that, it has been sufficiently established that, as of 2022, the time the affidavits were filed, the Lands continued to be classified as Malay Reserve. This Court thus find that the Plaintiff's failure to produce the alleged Malay Company declaration, despite the Defendant raising this challenge early in its first Affidavit in Reply, amounted to a suppression of material evidence. This attracts an adverse inference under Section 114(g) of the Evidence Act 1950, suggesting that if produced, the evidence would be unfavourable to the Plaintiff.

The Supreme Court in Munusamy Vengadasalam v PP [1987] CLJ Rep 221 held that an adverse inference can be drawn if there is suppression of material evidence by a party at p.223 (para. d-e): “Adverse inference under that illustration can only be drawn if there is withholding or suppression of evidence and not merely on account of failure to obtain evidence. It may be drawn from withholding not just any document, but material document by a party in his possession, or for non-production of not just any witness but an important and material witness to the case”.

Besides, it is trite that affidavit in reply must reply specifically to allegations of fact made in the affidavit. Failure to answer specifically would be deemed by the Court as an admission. When the Defendant questioned the Malay status of the Plaintiff, the Plaintiff should have immediately refuted the same with documentary proof in its subsequent affidavit. This, the Plaintiff had failed to do. Perhaps realising the seriousness of this failure to refute such material allegation, the Plaintiff then attempted to introduce this during the re-examination of the Deponent (after the Defendant had cross-examined the deponent). Not-surprisingly, Counsel for the Defendant strongly objected to the Plaintiff introducing the claim of possessing the Malay Company declaration during re-examination. The Defendant argued that re-examination cannot be used to elicit new evidence that was not presented in affidavits or challenged during cross-examination. The Defendant asserted that this constituted a violation of the rule of fair play, as it deprived them of the opportunity to properly test and cross-examine this new assertion. This Court fully concur with the Defendant on this point. Introduction of new evidence during re-examination which was never presented in affidavits or challenged during cross-examination should never be allowed. The Plaintiff had the one and only golden opportunity to answer and refute this serious yet material allegation: in its reply to the Defendant’s affidavit. It had failed to do so. That in itself is already an admission of fact and a suppression of material fact which would cause the drawing of adverse inference under Section 114(g) of the Evidence Act. ii. Registration of the Lease

This adverse inference is further strengthen by the Plaintiff’s failure to register the lease within 3 years. Clause 10.6 of the Lease Agreement required the lease to be registered. Arguably, the most conspicuously unfulfilled obligation on the part of the Plaintiff is its duty to register the lease. While, on the surface of it, it is entirely up to the parties to continue or discontinue with the contract when there is fulfilment or non fulfilment of certain terms of the contract, the non registration in itself supports and enhances the adverse inference that this lease is illegal because the Plaintiff is not a Malay company and thus could not have the lease registered.

And according to the timeline required by Clauses 3.2(a) – (d) of the Lease Agreement, the Lease Agreement would logically be registered within 3 years of the Lease Agreement (i.e. in 2015) (See Plaintiff AIS, p.17) (Encl.2)

The land search done in 2021 to 2022 reveals that the lease was still not registered (See Defendant AIR, p.66) (Encl.8).

The Plaintiff’s deponent had also answered (when cross-examined) that the Memorandum of Lease should have been presented within 36 months of the Lease Agreement. [See NOP, pp.10 & 11] And would you also agree that if we follow the timeline of 36 months from the date of agreement, which is the completion date, under this agreement the Memorandum of Lease in favour of the Plaintiff would be registered. Yes And would you also agree that if I was now going to refer you to the titles that have been produced by you as well as the Defendant. Before the Court the title does not show that the lease has been registered in the 2 name of the Plaintiff.

There is no satisfactory explanation from the witness as to why the lease has not been registered. For the reasons of these 3 obligations being shown to have not been fulfilled, the Plaintiff has failed to prove on a balance of probabilities that it has any entitlement to possession pursuant to the Lease Agreement. Thus, the Plaintiff’s case of trespass against the Defendant has failed.

The Plaintiff submitted that the non-registration of the Lease Agreement does not invalidate its rights. They characterized it as a matter of mere formality and an administrative process that does not detract from the Plaintiff's rights to vacant possession.

The Plaintiff explicitly cited Section 206(3) of the National Land Code 1965, which they argued “explicitly preserves the contractual validity of transactions” despite non-registration. They maintained that the legal effects and obligations of the Lease Agreement remain enforceable between the Plaintiff and LADA, regardless of its unregistered status, thus the Lease Agreement is valid and enforceable.

Furthermore, the Plaintiff argued that the Lease Agreement is valid and enforceable as an agreement in equity, and that the equitable relief recognized by Section 206(3) NLC 1965 should be construed in their favour, allowing an unregistered lease to be treated as an equitable lease capable of specific performance.

No doubt, this is the position of the law on equitable lease. However, the circumstances of our present case is unique in the sense that the Lands are Malay reserved lands and the Plaintiff had not tendered any proof to establish its Malay company status despite being challenged.

The document establishing that the Plaintiff is a Malay company is indeed another material piece of evidence. In its absence, the Plaintiff could not lawfully possess the land under the lease, since such a lease would constitute an illegal and void dealing. This is clearly provided for under Section 6 and Section 8 of Enactment No. 63 (Malay Reservations) (Kedah) mentioned earlier.

Also, in the event of non-registration of the lease (as in our present case), this Court take the view that the proof of payment is crucial. As such, the Plaintiff bears the burden of establishing its right to possession of the Lands. In this context, evidence of payment is fundamental to support the Plaintiff’s claim of a validity performed lease contract.

Hence, these 2 documents are essential to the Plaintiff’s narrative that it has the right to possession pursuant to the Lease Agreement. The Plaintiff must prove that the Lease Agreement was valid and performed (See also Jamaludin bin Jaafar v Affin Bank Bhd and another appeal [2016] 12 MLJ 88). The Plaintiff has failed this on all counts.

The most essential of all, since Clause 4.1 was not performed, and the Plaintiff cannot establish its Malay company status, the Plaintiff can never have possessory rights even if it paid for everything and LADA allowed it on the land. The Lease would be void notwithstanding whatever arrangement between the parties.

Therefore, evidence confirming that the Plaintiff is a “Malay company” is both necessary and fundamental to establishing its claim. Given the Plaintiff’s deliberate failure to produce this document despite the challenge raised, the court is left with no option but to draw an adverse inference and conclude that the Plaintiff does not, in fact, possess the required documentation.

The failure of the Plaintiff to resgister the lease right until this Application was filed in 2022 could only support this adverse inference that the Plaintiff was never a Malay company and thus could not have itself registered properly as a leasee notwithstanding the requirement under the lease. D.

The Defendant argued that the Application submitted by the Plaintiff was procedurally defective, primarily due to the non-joinder of necessary parties. This forms a key part of the Defendant's case, suggesting the lawsuit should be dismissed from the outset.

The Plaintiff's first prayer in the Originating Summons (OS) seeks a declaration that it is the legitimate lessee (pemegang pajakan) of the Lands, specifically Plot 94 and Lot 51.

The Defendant contended that because the Lease Agreement was not registered, the Plaintiff needed to provide sufficient evidence that the lease is legally valid and that the Plaintiff had performed its obligations under it.

The Defendant argued that when seeking a declaratory order under Section 41 of the Specific Relief Act 1950, the Plaintiff is obligated to name all necessary parties who have an interest in denying the declaration.

It is undisputed that the owner of the Lands in question (Plot 94 and Lot 51) is LADA. The Defendant asserted that instituting a suit to declare the Plaintiff as the leaseholder without naming LADA, the owner, renders it an ex-parte declaration that would directly affect LADA. LADA is considered an important figure to admit or deny the existence of the lease.

I am in full agreement with the Defendant when it highlighted that failure to name a party with an interest in the rights of the subject matter is fatal and contrary to the principles of natural justice. This point was supported by the Defendant’s authorities of CKH Engineering Sdn Bhd v Lim Beng Kit [2017] MLJU 280 and Kunstler v Kunstler [1969] 3 All ER 673, which emphasized that a court should not grant declaratory relief when third-party interests are involved without making that third party a part of the proceedings.

The Plaintiff countered the Defendant's argument regarding procedural defectiveness by stating that under Order 15 rule 6(1) of the Rules of Court 2012, a cause or matter shall not be defeated by reason of the non-joinder of any party.

The Plaintiff argued that the Defendant itself could have applied to add LADA as a party under Order 15 rule 6(2)(b) of the ROC 2012, but it never did so.

The Plaintiff also maintained that LADA has not, at any time, challenged the validity of the Lease Agreement, and as a non-party to the agreement, the Defendant has no right to challenge its validity.

Since the Plaintiff is seeking for a declaration here and that declaration is concerning the right of a third party, who was not named, the suit just cannot proceed.

The Plaintiff also contended that the LHDN receipt for stamp duty serves as evidence of the Lease Agreement. The Defendant responded to this by arguing that while such a receipt may exist, it does not conclusively prove the Plaintiff's right to possession or the full validity and subsistence of the Lease Agreement. Again, I concur. Stamping of an agreement would never establish its validity.

As the Defendant had argued earlier, the Lease Agreement was not registered. Therefore, to prove its right to possession, the Plaintiff had to demonstrate that the lease agreement was coupled with performance of its conditions and was capable of being specifically enforced. Merely paying stamp duty, as evidenced by the LHDN receipt, does not fulfil this burden.

The Defendant had specifically challenged too as to whether the Plaintiff had actually paid the full RM65 million lease consideration to LADA, beyond just the stamp duty. They pointed out that despite being challenged on this, the Plaintiff's deponent, Raja Noor Kamariah, did not provide documentary proof of payment in her affidavits. During cross-examination, Raja Noor Kamariah merely stated that proof of payment was irrelevant.

It is worth to take note of Raja Noor Kamariah’s testimony during re-examination, when she stated the Plaintiff had paid the lease amount and was in possession of the LHDN receipt. This was new evidence as it was first mentioned during the re-examination. I am again with the Defendant that re-examination is only for clarifying existing evidence, not for introducing new facts and/or evidence, and that this prejudiced the Defendant.

Above all, the Lease Agreement required the Plaintiff to obtain a declaration as a Malay company and since the Plaintiff had failed to provide any evidence of this declaration, the lease would be void under Section 6 and 8 of the Enactment No. 63 (Malay Reservations) (Kedah), regardless of any stamp duty paid or alleged full payment. This renders any claim to possession invalid. As such, the first and crucial requirement of a trespass had not been fulfilled.

In essence, the LHDN receipt, while indicating stamp duty payment, was insufficient on its own to establish the Plaintiff's fundamental right to possession given the non-registration and other critical, unproven conditions of the lease. The Plaintiff has thus failed to establish its case on the balance of convenience.

To sump up, the Plaintiff's insufficient proof of compliance with Malay reservation requirements leads this Court to rule for the Defendant, notwithstanding the lease agreement with LADA. Mere assertion without any evidence, despite being challenged in affidavit, is insufficient.

The Application in Encl.1 is hereby dismissed with cost. Dated: 11th August, 2025 ............................................................. YA Dr John Lee Kien How @ Mohd Johan Lee Judge High Court Malaya Alor Setar, Kedah Darul Aman For the Plaintiff : M. Pathmanathan & Shirin Pathmanathan Messrs. M. Pathmanathan & Co. Advocates & Solicitors For the Defendant : Mathew Thomas Philip, Nandakumar S. Haridas, Raqib bin Osman & The Ee Fey Messrs. Thomas Philip Advocates & Solicitors Table of Authorities Cases Cahaya Utama Industries Sdn Bhd v Kong Kam Peng [2007] 8 MLJ 528 CKH Engineering Sdn Bhd v Lim Beng Kit [2017] MLJU 280 Holee Holdings (M) Sdn Bhd v Chai Him & Ors [1997] 4 MLJ 601 Jamaludin bin Jaafar v Affin Bank Bhd and another appeal [2016] 12 MLJ 88 Kunstler v Kunstler [1969] 3 All ER 673 Munusamy Vengadasalam v PP [1987] 1 CLJ 250 Qiristar Bricks Contractor Sdn Bhd & Anor v Loo Ngan Keong & Anor [2013] 10 MLJ 363 Tenaga Nasional Berhad v Bukit Lenang Development Sdn Bhd [2019] 1 MLJ 1