06/14/13 Ainul Jaria Maidin 2013 2 RATIONALE Reserving land for certain public purposes,land can be reserved for certain class orgroup of people for their sustenance andprevent extinction. principally aimed at protecting proprietary interests prevent extinction of a particular race fromtheir motherland by restricting sales of land tomigrant communities who came in search ofgreener pastures or colonialist policies.
06/14/13 Ainul Jaria Maidin 2013 3 Concept of reservation found invarious communities: US for American Indians Australia for Aborigines, New Zealand for Maori South Africa for Africans Malaysia for Malays and natives
06/14/13 Ainul Jaria Maidin 2013 4MALAY RESERVATIONConcept and Administration
06/14/13 Ainul Jaria Maidin 2013 5Ideology of Malay Reservation To protect Malay land from being sold toimmigrant communities. Malay Reservation Enactment 1913 tendedto artificially protect Malays from economicdislocation that resulted from influx ofChinese and Indian immigrants to MalayPeninsular (Gordon Means, “Special Rights as aStrategy for Development: The Case ofMalaysia”, in Comparative Politics 1972 5(1)Jomo Sundram.
06/14/13 Ainul Jaria Maidin 2013 6MALAY RESERVATIONENACTMENT passing of Enactment was due todevelopment of colonial capitalisteconomy. growth of capitalism enterprisesunder colonialism led to a rapidincrease in immigrant population and acorresponding growth in riceconsumption, which affected padiproduction in several ways.
06/14/13 Ainul Jaria Maidin 2013 7 increase in rice consumption was largely metby increasing imports of cheap rice fromThailand and Burma. In 1890 rice imports constituted more than35% of total imports; this exceeded thegovernment revenue and amounted to 31 %of export receipts (JOMO 1988 p.16) In order to minimise loss of foreignexchange and to curb Malay peasants fromdiverting away from traditional agriculturalactivities
06/14/13 Ainul Jaria Maidin 2013 8 British colonialists introduced landreservation in favour of Malays withobjective of protecting Malay landproprietary interests to prevent Malaysfrom dealing with immigrants. Rapid development in Malay States broughtabout influx of immigrants especially owingto British colonial policy workforce to workin time mines, rubber plantations,construction and development ofinfrastructure
06/14/13 Ainul Jaria Maidin 2013 9 Chinese immigrants were very keen toacquire land in Malay states Malays willing to depart land for money. Historians - principle reason for introducingMalay Reservation by British is to preventthe prominence of Chinese community, whichwas growing strong with forming of secretsocieties (kongsi gelap) and gaining economicdominance compared to other immigrants.
06/14/13 Ainul Jaria Maidin 2013 10 British felt threat to theiradministration need to prevent Chinese and otherimmigrant community from acquiringland which is most valuable commoditycreated for Man.
06/14/13 Ainul Jaria Maidin 2013 11Types of Reserved Landsin Malaysia Malay Reserved Lands Malacca Customary Lands Native Lands in Sabah and Sarawak Malay Agricultural SettlementKampung Bahru, Federal Territory
06/14/13 Ainul Jaria Maidin 2013 12Malay Reserved Law Laws were introduced by British during pre-Merdeka period Malaysian government also introduced postMerdeka law to safeguard Malay landownership. laws relating to Malay Reservation will needto be studied at two different periods, i.e.pre-merdeka and post merdeka period.
06/14/13 Ainul Jaria Maidin 2013 14Post Merdeka Laws Federated Malay States MalayReservations Enactment No. 30 of1933 Chapter 142 Federal Constitution of Malaysia 1957
06/14/13 Ainul Jaria Maidin 2013 15 Two sets of Enactment regulating MalayReserved land. Enactments aimed at specific object ofpreserving and protecting Malay landproprietary rights. There is one single uniform law known as theFederated Malay States Malay ReservationsEnactment 1933 (Cap 142), which is applicableto the States of Selangor, Perak, NegeriSembilan, Pahang and the Federal Territory ofKuala Lumpur.
06/14/13 Ainul Jaria Maidin 2013 16UnFederated Malay States former UnFederated Malay Statesthat is the states of Kelantan, Kedah,Johor, Trengganu and Perlis havetheir respective state Enactment.
06/14/13 Ainul Jaria Maidin 2013 17 Provisions in the Enactment differs and this, tocertain extent has defeated the objective ofMalay reservation institution: ambiguity in definition of Malay loopholes in policy of disposal or dealing in Malayreserved land inclusion of other races to hold Malay reservationland, even though Federal Constitution expresslyprohibits non-Malay from dealing with Malayreservation land.Nature of Enactments
06/14/13 Ainul Jaria Maidin 2013 22Perlis Malay Reservations Enactment 1353was modelled from 1913 FederatedMalay States Enactment. came into force on 17thZul-Hijjah1353/ 1935 (No.7 of 1353)
06/14/13 Ainul Jaria Maidin 2013 23Kedah Malay Reservations Enactment of wasmodelled from 1913 Federated MalayStates Enactment. Came into force in 1931 (No.6 of1349)
06/14/13 Ainul Jaria Maidin 2013 24Penang British claimed that there was no customarylaw in existence in Island of Penang whenthey took over and applied English commonlaw. Ong Cheng Neo v Yeap Cheah Neo (1897) 1Ky. 326, 337 Privy Council – island was adeserted territory and there was no traceof any laws having been established;therefore the English law was applicable.
06/14/13 Ainul Jaria Maidin 2013 25Penang …cont.. No recognition was given to law of thenatives of State, as there was onlyfew Malay families found whenBritish first occupied the state Regina v. Willians (1858) 3 Ky. 16. Therefore, Malay reservation law wasnot introduced in Penang.
06/14/13 Ainul Jaria Maidin 2013 26Perak Federated Malay States MalayReservations Enactment 1933 Perak was one of the earliest Statesto convert land into MalayReservation.
06/14/13 Ainul Jaria Maidin 2013 27Selangor Federated Malay States MalayReservations Enactment 1933 isapplicable in Selangor.
06/14/13 Ainul Jaria Maidin 2013 28Kuala Lumpur Initially prior to Merdeka, British haddeclared 4 areas into Malay Reservation underthe Malay Reservation Enactment 1913. Sungai Pencala Malay Reservation, about 756acres; Segambut Malay Reservation about 710 acres. Selayang Malay Reservation about 542.4acres; Gombak Malay Reservation about 3640 acres.Kampung Baru Malay Agriculture Settlement.
06/14/13 Ainul Jaria Maidin 2013 29Malacca No Malay Reservations policy in Malaccabeing a member of Straits Settlement British has maintained and protectedcustomary rights of Malays. National Land Land Code(Penang andMalacca Titles) Act 1963 governscustomary land in Malacca. Section 108 of Act - transfer, lease andtransmission of customary land should onlybe made in favour of Malay domiciled in theState.
06/14/13 Ainul Jaria Maidin 2013 31Pahang Pahang a member of Federated MalayStates applied the uniform law of thefour States i.e. Federated MalayStates Malay Reservations Enactment1933.
06/14/13 Ainul Jaria Maidin 2013 32Trengganu Trengganu followed the model of theFederated Malay States MalayReservations Enactment 1933. It wasthe last to implement the MalayReservations Enactment in 1941.
06/14/13 Ainul Jaria Maidin 2013 33Kelantan Legislation modelled on the 1913 FMSEnactment. Came into force on November 4th1930. Almost all lands in Kelantan aredeclared as Malay reserve underKelantan Malay ReservationEnactment 1930.
06/14/13 Ainul Jaria Maidin 2013 34 Federated Malay States MalayReservations Enactment 1933 andCustomary Tenure Enactment areapplicable to Malays in that State. FMS MRE is applicable in districts ofJelebu, Kuala Pilah, Rembau andTampin. (Federated Malay States Cap.215)Negri Sembilan
06/14/13 Ainul Jaria Maidin 2013 35Who is a Malay definition of Malay varies from Stateto state basically depending on thegeographical location and alsointerpretation accorded by Ruler inCouncil or State Authority. definition of a Malay is determinedby state enactments.
06/14/13 Ainul Jaria Maidin 2013 36malaysCertificated siamese & Arab descentmalaysNo arab descent
06/14/13 Ainul Jaria Maidin 2013 37Perlis s 2 “Malay” means a person belonging to anyMalayan race or person of Arab descent whohabitually speaks the Malay language or anyMalayan language and professes the Muslimreligion. “Siamese” means a Siamese certified by theCommissioner in writing to be a Siameseagriculturist permanently resident in theState of Perlis. Perlis being situated near border of Thailand,a Siamese has right to acquire MRL. person of Arab descent who habitually speaksMalay language is considered Malay in Perlis.
06/14/13 Ainul Jaria Maidin 2013 38Kedah S.2 of Kedah Enactment provides “Malay”means a person professing the Muslimreligion and habitually speaking the Malaylanguage of whose parents one at least is aperson of Malayan race or Arab descent.(Vide E 9/54 Kedah Laws 1559) Siamese is included as natives and has rightto acquire Malay reserve lands.
06/14/13 Ainul Jaria Maidin 2013 39Johor “Malay” means a person belonging to theMalay or any Malaysian race who habituallyspeaks the Malay language and professes theMuslim religion and such expression shall bedeemed to include the authorities, boards,bodies, societies, associations and companiesdescribed in the Second Schedule to thisEnactment: with a preamble that reads ‘An Enactment toprevent interests in land passing out of thehands of the Malay race.’ Johor MalayReservation Enactment 1936 has employedthe word ‘Malaysian’ instead of ‘Malayan.’
06/14/13 Ainul Jaria Maidin 2013 40Kelantan s 3(i) provides “Malay” means a personbelonging to any Malayan race whospeaks any Malayan language andprofesses the Mohammedan religion,and shall include (a) the Majlis UgamaIslam (b) the Official Administratorwhen acting as administrator ortrustee of the estate of a deceasedMalay
06/14/13 Ainul Jaria Maidin 2013 41Terengganu “Malay” means a person belonging toany Malayan race who habituallyspeaks the Malay language or anyMalayan language and professes theMoslem religion
06/14/13 Ainul Jaria Maidin 2013 42A Malay Company Definition of a Malay company orrequirement for a company to be ableto deal with Malay Reserved land. Malay Company defined only in FMSMRE s 2 and Trengganu MRE s 2.
06/14/13 Ainul Jaria Maidin 2013 43A Malay Company Requirements of Malay Company are: (a) registered under Companies Act 1965; (b) all members are Malays; (c) transfer of shares restricted by theArticles of Association to Malays only; and (d) objective of Company is to deal in Malayholding land.
06/14/13 Ainul Jaria Maidin 2013 44Malay Company Hj Lamin bin Hj.Mohd Yunus J. in WanIsmail & Seng Liang Sdn. Bhd. v Musabin Mat Jani & Anor  2 CLJ 379 dealing in favour of a company where, interalia not all members are Malay is not aMalay company under FMS MRE s 2. Therefore any dealing conducted bycompany is contrary to FMS MRE s 7 andshall be declared as null and void by virtueof FMS MRE s 19.
06/14/13 Ainul Jaria Maidin 2013 45 other States’ MRE have not included anyprovisions on the requirements to establishMalay company. Reason - rigid requirements to establish aMalay company HOWEVER, Ruler-in-Council may declare or include any person,companies, corporations or bodies to betreated as ‘Malay’ for purposes of MRL(Johor MRE s 2; Kedah MRE s 19; KelantanMRE s 9A(1) Perlis MRE s 9(1) & 17A(i)).
06/14/13 Ainul Jaria Maidin 2013 46Requirements to be fulfilled to berecognised as Malay Holding By virtue of FMS MRE s 2(a) requirementsof Malay holding are: i. Either proprietor or co-proprietor shall bea Malay ii. alienated land iii. declared and gazette as Malayreservation; and iv. Inclusion of land under official Malayreservations list
06/14/13 Ainul Jaria Maidin 2013 47Malay Holding All requirements are mandatory to befulfilled before a land can be declared asMalay holding. Failure to comply with any onerequirements, the alienated land cannot bedeclared as Malay holding. If the proprietor is not Malay or none ofthe co-proprietors are Malay theregistering body is not empowered to makeany memorial under the MRE or inclusionof the said land under the Malayreservations list see FMS MRE s 6(vi),
06/14/13 Ainul Jaria Maidin 2013 48Court Interpretation Syarikat Macey Berhad v. NightingaleAllied Services (Sued As A Firm) & 2ORS.  1 CLJ 890 Dato’ JamesFoong - in a Malay Holding there must be aMalay proprietor or co-proprietor. if all arenon-Malays, land cannot be declared asMalay Holding However, if one of proprietor is Malay andothers are non-Malays, then land can bedeclared as Malay Holding.
06/14/13 Ainul Jaria Maidin 2013 49Endorsement on IDT Requirement - Title must beendorsed with words ‘MalayRESERVATION’ – “TANAH RIZABMELAYU” Registered proprietor is required tosubmit to registering authority theiridt to be inscribed with the words‘Malay Reservation.’ FMS MRE section6(iv)
06/14/13 Ainul Jaria Maidin 2013 50 No Malay holding can take effect until andunless it has been registered against RDT. However, despite land published in gazetteas Malay reservation, State Authoritycannot proceed to endorse it as MalayHolding if proprietor or co-proprietor is nota Malay Syarikat Macey Berhad v. NightingaleAllied Services (Sued As A Firm) & 2 OrsJames Foong J. ‘since, the land has neverbeen registered in name of Malay proprietoror co-proprietor, the memorial so entered onthe affected titles is therefore erroneous.’
06/14/13 Ainul Jaria Maidin 2013 51Duty of Registrar The duty of Registrar is mandatoryas he shall endorse or cause toendorse on every register documentof title and the issue document oftitle pertaining to a Malay holding thewords ‘Malay holding’ and no fee shallbe charged for making the memorialservice.
06/14/13 Ainul Jaria Maidin 2013 52Failure to Endorse on Titleand Implications It is possible by non-endorsement of thewords ‘Malay reservation’ on the IssueDocument of Title and Register Documentof Title, it could lead the proprietor toabuse the law by charging or dealing withhis land to the non-Malay. This problem ofnon-endorsement on the title wasdescribed as early as 1928 in theCommissioner of Lands Circular, where thecommittee provided solution to thisproblem
06/14/13 Ainul Jaria Maidin 2013 53 In cases of omission to inscribe the words“Malay Reservation” on the registerdocument of title, a grant to land in aMalay Reservation which is sold, inexecution of a decree, to non-Malay. The Court, on a reference by theRegistrar under s.238 Land Code, heldmere notification in the Gazette ofdeclaration of reservation does notamount to notice to a purchaser, and thata bona fide purchaser of reservation landwho is without notice of this restriction,takes free from the restriction.
06/14/13 Ainul Jaria Maidin 2013 54 object of inscription as prescribed byFMS MRE s 12 is aimed at notifyingpublic of the status. For purpose of inscription, duty isimposed upon the Collector of callingin and enforcing the production of allidt to land held by Malays within adeclared area, immediately afterdeclaration takes effect
06/14/13 Ainul Jaria Maidin 2013 55 Asia Commercial Finance (M) Bhd. vPemungut hasil Tanah & Anor. 1CLJ 86. registered proprietor sold two pieces ofland to Rohani who, while waiting for landto be transferred to her, applied to AsiaCommercial to refinance the sales andpurchase of land. A private search was made on title and itdid not disclose anything. when the transfer, charge and lien-holder’s caveat was submitted forregistration, the Land Officer rejectedit.
06/14/13 Ainul Jaria Maidin 2013 56 Ground for rejection - land was gazetted asMRL in 1931 under MRE 1913, and it issubject to provisions of MRE 1933. Finance company is not a body included andspecified in Second Schedule in Enactment,therefore the finance company is barredfrom holding the land as a chargee. The company argued that certificate ofofficial search failed to disclose that theland is MRL, therefore they are bona fidechargee for value within ambit of section340 (3) NLC.
06/14/13 Ainul Jaria Maidin 2013 57 Wan Hamzah J, held that one has togo beyond the RDT in order to searchas the official search is notconclusive evidence This actually defeats the mainprinciple of the Torrens System,that the register is everything. Itseems that the judge has erred inlaw by suggesting to conduct searchbeyond RDT.
06/14/13 Ainul Jaria Maidin 2013 58 Badiaddin v First Malaysia FinanceBerhad & Anor  2 CLJ 32; 2 CLJ 75 FC. The land wasgazetted as ‘Malay Reservation’ andpublished in February 2nd1917 butwas only entered and registered onthe title of land on February 18th1984, i.e. after 67 years. To make matters worse the land wasalready charged to a non-Malaycompany in 1981.
06/14/13 Ainul Jaria Maidin 2013 59 Upon discovery of this endorsement,company appealed to MB of NegeriSembilan to revoke status of Malay reserveas they are bona fide chargee. State Authority agreed to insert companyin FMS MRE 1933 s 17 Schedule 2, andgazetted on March 27th1986. Q – Status of charge - null and void? HC & FC held that irrespective of lateendorsement and that money has beenreleased, land is still a MRL, and it comeswithin ambit of MRE, therefore, thecharge is null and void.
06/14/13 Ainul Jaria Maidin 2013 60Reference to Ruler inCouncil
06/14/13 Ainul Jaria Maidin 2013 61Reference to Ruler inCouncil All the States MRE Enactment haveinserted a section stipulating forReference to Ruler in Council in event ofdoubt. Situations where is necessary asprovided in FMS MRE s 20. a. definition of Malay b. the mode of operation of the Enactment c. the manner in which the provisionsthereof to be construed or carried intoeffect
06/14/13 Ainul Jaria Maidin 2013 62Who is Ruler in Council Hanisah v Tuan Mat  1 MLJ213 to mean ‘His Highness acting inaccordance with the advice of theState Executive Council’. Situationswhere reference to the Ruler inCouncil is necessary as provided inFMS MRE s 20.
06/14/13 Ainul Jaria Maidin 2013 63 In FMS MRE s 20, it is stated that incases of doubt the matter shall bereferred through the Menteri Besar tothe Ruler of the State Council. In JohorMRE the matter is referred through theState Secretary to His Highness theSultan in Council. Kelantan MRE, s 18 states that the mattermay be referred to His Highness theSultan in Council without referring to theMenteri Besar.
06/14/13 Ainul Jaria Maidin 2013 64 Kedah MRE restated & reconfirmed theright of Ruler in Council to declare ‘anyperson of any race or nationality bedeemed to be recognised as “Malay”. Shirlie Gordon in “Contradictions”, - Kedahprovision was inserted later to allowEuropean wife of Tunku to inherit his MRLupon his death. She was declared as a‘Malay’ for purposes of MRE to inherit theland.
06/14/13 Ainul Jaria Maidin 2013 65 Kelantan MRE s. 9A & 13A (i) Included provision where Ruler-in-Councilcan alienate, transfer, transmit or chargeMalay reserve land to anyone who is not aMalay (see Schedule D of Kelantan MRE whereit has approved for example Ban Hin LeeBank Bhd, Chung Kiaw Bank Limited toacquire interest in MRL).
06/14/13 Ainul Jaria Maidin 2013 66 Foo Say Lee v. Ooi Heng Wai 1 MLJ 47 FC –agreement to transfer MRLsubject to consent of Ruler in Councilis not contrary to Kelantan MRE. Reason - MRL can be transferred toa non-Malay subject to approval ofRuler in Council.
06/14/13 Ainul Jaria Maidin 2013 67 Kelantan Ruler not empowered to declare anyperson as Malay unlike Kedah MRE which givesa wide discretion to Ruler-in-Council todeclare any person of any race or nationalityas Malay (Kedah MRE s 19) Kelantan MRE allows the person to acquire aright or interest over land. Trengganu MRE does not declare bodies asMalays, it merely grants a right to them tohold MRL with consent of Sultan-in-Council.
06/14/13 Ainul Jaria Maidin 2013 68Non-Malay to Non Malay A non Malay proprietor of MRL hasABSOLUTE RIGHTS to transfer right orinterest to non-Malay without priorconsent from Ruler (Kelantan MRE s3A(iii)). Tan Hong Chit v. Lim Kim Wan  MLJ113 Syarikat Macey Bhd. v Nightingale AlliedServices (sued as a firm) & Ors.
06/14/13 Ainul Jaria Maidin 2013 69 Decision of Rulers is FINAL &CANNOT be questioned or revised bycourt (FMS MRE s 20).
06/14/13 Ainul Jaria Maidin 2013 70 Kelantan MRE s 13 - right of question exitsuntil the decision has been certified underhand of State Secretary. Hanisah v. Tuan Mat  1 MLJ 230-Kelantan MRE s 13 merely states decisionof Ruler in Council should not be revised orquestioned by Court. does not in obstructcourt to expound Acts of Parliaments. Furthermore it is duty of Court and notRuler or the legislators
06/14/13 Ainul Jaria Maidin 2013 71 Zaleha bte Sahri v. Pendaftar Hak MilikTanah Johor  2 CLJ 147 - courtgranted a declaratory order to revokestatus of MRL by virtue of landowner notbeing a Malay without referring matter toRuler-in-Council. Johor MRE it is mandatory to refer toRuler-in-Council in cases of mode ofoperation of Enactment, on definition ofMalay and manner provisions to beconstrued or carried into effect.
06/14/13 Ainul Jaria Maidin 2013 72 Abdul Malik Ishak J. Decision wasmore in sympathy for the appellantrather than analysing the initialobjective of the establishment ofMRE.
06/14/13 Ainul Jaria Maidin 2013 73 Asia Commercial Finance (M) Bhd.v Pemungut Hasil Tanah & Anor.(1983) CLJ 86 ;Zainal Abidin Bin Mohd. Taib vMalaysia National InsuranceSdn.Bhd. 3 CLJ 731observations that decision of Ruler-in-Council shall be final and shall notbe questioned or revised by anyCourt.
06/14/13 Ainul Jaria Maidin 2013 74Disposal of MRL by State Non-Malay person cannot apply for MRLfrom State Authority, He may be able to acquire a share orinterest in the MRL if he would make anapplication through a company orcorporation that are specified in the ThirdSchedule. FMS MRE s 7&20 provides that the Ruler-in-Council has discretionary powers todeclare any company or corporation asMalay and this decision, as has been arguedearlier, is final and cannot be questioned bythe Court.
06/14/13 Ainul Jaria Maidin 2013 75Ruler-in-Council’s discretion The Ruler-in-Council is further givendiscretion to add, delete from or amendfrom time to time in the list found in theThird Schedule, Zainal Abidin Bin Mohd.Taib v MalaysiaNational Insurance Sdn.Bhd. 3 CLJ731, where the Court held that thedecision of Ruler-in-Council is final andconclusive. It would only become officialonce it has been published in the gazette.
06/14/13 Ainul Jaria Maidin 2013 76 On the other hand, for FederalTerritory purposes, the discretion toadd, delete from and amend isgranted to Yang di Pertuan Agung. Negeri Sembilan the provision statethat those land which is alienatedunder section 7 would be deemed asMalay holding, notwithstanding thedefinition of Malay holding containedin FMS MRE s 2.
06/14/13 Ainul Jaria Maidin 2013 77 This leads one to believe that theState Authority can declare any landas a Malay holding irrespective of thedefinition of Malay holding, which isfound in s 2 of MRE. On the other hand, this might not betrue, as s 7 must be read togetherwith ss 2(a) & 6
06/14/13 Ainul Jaria Maidin 2013 78 Mohd Hishamudin Yunus J. in Sime Bank Bhd.v Projek Kota Langkawi Sdn Bhd,  4MLJ 334 while delivering judgement of thecase made a passing remark that he was verycurious to know how the State Authority couldhave alienated a Malay Reservation land thathas been declared as Malay reserve in 1933 tothe defendants who are not Malay within thedefinition of Kedah MRE in 1993 .
06/14/13 Ainul Jaria Maidin 2013 79 Mohd Hishamudin Yunus J. in Sime BankBhd. v Projek Kota Langkawi Sdn Bhd, 4 MLJ 334 - Remarked that hewas very curious to know how StateAuthority could have alienated MRLdeclared as MRL in 1933 to defendantswho are not Malay within definition ofKedah MRE in 1993
06/14/13 Ainul Jaria Maidin 2013 81 FMS MRE s 4(i) allows Menteri Besar,subject to approval of Ruler-in-Council to alter limits or boundariesof MRL subject to Article 89(1) Land declared as MRL prior toMerdeka Day - Article 89(1) ismandatory to be followed. – require2/3 majority in State LegislativeAssembly
06/14/13 Ainul Jaria Maidin 2013 82 Menteri Besar cannot alter status ofMRL until he complies with Article89(1). Non-compliance would declarealteration as null and void. If declaration made after MerdekaDay, State Authority can safely rely onprovisions of Enactment withoutadhering to Article 89(1).
06/14/13 Ainul Jaria Maidin 2013 83 No revocation or alteration of MRL isvalid until it published in Gazette. Mohamed Isa & Ors. v. Abdul Karim &Ors.  2 MLJ 180 - Raja AzlanShah - MRL will only lose itscharacter by way of an expressrevocation under States’ MRE
06/14/13 Ainul Jaria Maidin 2013 84Lands Declared prior toMerdeka Cannot be revoked or excised unless itfollows stringent rules in Article 89(1) ofFederal Constitution. If revocation did not adhere to proceduresin Federal Constitution, then it would bedeclared as nullity. Procedure does not apply to MRL declaredafter Merdeka Day.
06/14/13 Ainul Jaria Maidin 2013 86 Rationale of policy of reservation in lawimplies a right of exclusive control &ownership to a particular person or groupsof persons identified by law as solebeneficiaries of policy of reservation.’ Intrinsic & inherently consistent withpurpose of reservation will be imposition ofprohibition against dealing, such astransfer, charge or lease. Restriction as to dealing by power ofattorney, entry of caveat, bankruptcy,attachment, trusts
06/14/13 Ainul Jaria Maidin 2013 87Transfer FMS MRE s8 - no Malay holding can betransferred to Non-Malays Idris Bin Haji Mohamed Amin v. Ng AhSiew  FMSLR 70, Ct – ‘intention ofEnactment was to preclude Malays fromparting with any rights or interest inreserved lands.
06/14/13 Ainul Jaria Maidin 2013 88 Tan Hong Chit v. Lim Kin Wan(1964)30 MLJ 113 - a non-Malay who hasbeen occupying MRL prior to itsdeclaration can transfer his land toother non-Malays without approval ofRuler in Council as he is not bound byMRE provisions
06/14/13 Ainul Jaria Maidin 2013 89 Haji Hamid Bin Ariffin & Anor. v.Ahmad Bin Mahmud,  2 MLJ79 - issue was could Malay proprietorsell his Malay reserve land to aSiamese under the Kedah MRE? Secondly, presuming transaction isvoid and land is sold to a Malaypurchaser, will it pass a good title tonew purchaser?
06/14/13 Ainul Jaria Maidin 2013 90nemo dat quod non habet Federal Court - by virtue of KedahMRE s 6, no MRL could betransferred from Malay to Siamese. Secondly, by applying legal maxim,nemo dat quod non habet, (no one cangive what he does not possess), nolegal and good title can be passedfrom a void transaction or nosubsequent dealing can be legalisedfrom a void dealing.
06/14/13 Ainul Jaria Maidin 2013 91 Foo Say Lee v. Ooi Heng Wai,  1MLJ 47 FC - the purported agreement totransfer MRL, subject to consent of theRuler in Council is not contrary to KelantanMRE. Reason - MRL may be transferred to non-Malay subject to Ruler’s consent.
06/14/13 Ainul Jaria Maidin 2013 92 Privy Council in Mistry Amar Singh v.Serwano Wofunira Kulubya  3W.L.R. 513 - ‘the purpose of saidlegislation is to protect Africans andto preserve African land for use byAfricans.’ In this case, respondent an Africanthe registered proprietor of certain‘mailo’ lands purported by agreementsto lease lands to the appellant, anIndian.
06/14/13 Ainul Jaria Maidin 2013 93 Section 2 of the Uganda Land TransferOrdinance prohibits occupation by a non-African unless the consent in writing of theGovernor has been given. In this case, theparties did not obtained the relevantconsent, as a result both of them hadcontravened the law and committedpunishable offences. Privy Council held that as the respondent isa member of the protected class, and thesaid legislation was intended to be for thebenefit of Africans as a class therefore theagreement so entered is void ab initio.
06/14/13 Ainul Jaria Maidin 2013 94 The Court cited with approval the judgementof Lord Mansfield in Browning v. Morris (1778)Cowp. 790, where he said:“But, where contracts or transactions areprohibited by positive statutes, for the sake ofprotecting one set of men from another set ofmen; the one, from their situation andcondition, being liable to be oppressed orimposed upon by the other; there, the partiesare not in pari delicto; and in furtherance ofthose statutes, the person injured, after thetransaction is finished and completed, maybring his action and defeat the contract.”
06/14/13 Ainul Jaria Maidin 2013 95Charge MRL to Non-Malay FMS MRE s 8(i) states that no MRLcan be charged to non-Malay exceptto Government, Co-operativeSocieties registered under Co-operative Societies Act 1948 (FMSMRE s 17(1)(a) & to any personspecified in Second Schedule of FMSMRE,
06/14/13 Ainul Jaria Maidin 2013 96 Charge of MLR to non-Malay not permittedunless to a person specified in the SecondSchedule of MRE. This is due to the fact that the person inSecond Schedule need not be a born Malayunder MRE s 2. Any person may apply to the StateAuthority to be declared as Malay for thepurposes of the MRE and to be inserted inMRE Second Schedule. Therefore, acompany can after registering the chargeapply to the State Authority to be includedin the Second Schedule.
06/14/13 Ainul Jaria Maidin 2013 97 Zainal Abidin Bin Mohd. Taib v.Malaysia National Insurance Sdn.Bhd  3 CLJ 731 - a charge wascreated and registered on September6th1982 to the Defendant, a non-Malay company. The defendant applied to the StateAuthority to be included in theSecond Schedule as a recognisedChargor only after registration of thecharge.
06/14/13 Ainul Jaria Maidin 2013 98 This was approved only in October23rd1991. Subsequently the StateAuthority by its letter dated July 21st1992, agreed to have a retrospectiveapproval, dating back to January 1st1982 of declaring the non-Malaycompany as a Malay for the purposesof the charge under section 17 andSecond Schedule of FMS MRE. FaizaThambi Chik J. held that the chargeis valid and the decision of the Rulerin Council is binding.
06/14/13 Ainul Jaria Maidin 2013 99 Badiaddin v First Malaysia FinanceBerhad Mustapha Hussain J. held thateven though the declaration of MRL wasentered only after the charge has beenregistered, the charge is still void as theland is a MRL. This is despite the State Authority hasapproved to insert the Respondent inSchedule 2 of s 17 MRE, as a companyqualified to hold a MRL. Federal Court upheld the decision in 1998and there was no attempt to distinguishthis case with Zainal Abidin Bin Mohd.Taib v. Malaysia National InsuranceSdn. Bhd.
06/14/13 Ainul Jaria Maidin 2013 100Confusion in Kelantan Ho Giok Chay v. Nik Aishah (1961)27 MLJ 49 Hepworth J. held afteranalysing s 7(i) and 9A held that acharge created in favour of a non-Malay by a Malay on a Malay reserveland was void ab initio.
06/14/13 Ainul Jaria Maidin 2013 101 Whereas, in T. Bariam Singh v.Pegawai Pentadbir Pesaka Malaysia 1 MLJ 232, Mohamed Zahir J.held can create charge of MRL but inforeclosure proceedings thepurchaser must be a Malay. Anddisagreed with the decision ofHepworth J. in Ho Giok Chay v. NikAishah.
06/14/13 Ainul Jaria Maidin 2013 102 Recently in, Dato’ Haji Nik Mahmud binDaud v. Bank Islam Malaysia Bhd. 3 MLJ 393 the CA avoided to provide asolution to this conflicting judicial opinionhowever, went on to say that ‘a chargetransfers or vests a right or interest to orin the land in the chargee, otherwise acharge would be valueless and of no effect,the essential element being that thechargee is entitled to reimburse himselfout of the land, that is to compel paymentof the amount due by sale of the landitself.’
06/14/13 Ainul Jaria Maidin 2013 103 In Sime Bank Bhd v. Projek KotaLangkawi Sdn Bhd 1998] 4 MLJ 334a Malay or Siamese in the light of s6(1) of Kedah MRE can create acharge of MRL in favour of a non-Malay.
06/14/13 Ainul Jaria Maidin 2013 104Lease General prohibition in MRE s 8(i) againstcreation of leases of Malay reserve land tonon-Malay. However, Kelantan MRE s 7(iii) allows leaseof Malay reserved lands situated withintown areas to non-Malays, subject to theapproval of His Highness the Sultan. Thesaid lease should not exceed 3 years andnon-renewable and any provision in thelease which allows for renewal shall bedeclared as null and void.
06/14/13 Ainul Jaria Maidin 2013 105 In respect of Malay reserved lands outsidethe boundaries of town, monthly leasesmay be given to non-Malays and such leasemay be terminated upon giving one month’notice, however, such leases does notrequire the consent of the Sultan. In Dato’ Haji Nik Mahmud bin Daud v.Bank Islam Malaysia Bhd, 3 MLJ393, 400 Abdul Malek Ahmad JCA heldthat the Kelantan MRE allows the Malaysto lease the Malay reserved lands to non-Malays.
06/14/13 Ainul Jaria Maidin 2013 106Entry of Caveat Non-Malays are allowed to enter a caveat onMRL. The State MRE provisions are silent onthis issue. In RAP Nathan v Haji AbdulRahman Bin Haji Yusoff & Ors,  1MLJ 248 Syed Agil Barakbah J held thateventhough the plaintiff is not Malay he hasa caveatable interest in the MRL. In addition to those treated as Malays forthe purposes of Malay reservation, that arenormally found in the FMS MRE schedule canalso enter caveat on a Malay holding.
06/14/13 Ainul Jaria Maidin 2013 107Lien In FMS MRE s 10, it is stated that no liencan be created on Malay holding. Theprovision is: “No lien by deposit of issue document oftitle for any Malay holding as security for adebt shall be capable of being created infavour of any person, and no caveat insupport of any such lien by deposit shall becapable of registration in any land Officeor Registry of Title.”
06/14/13 Ainul Jaria Maidin 2013 108Exceptions However, the FMS MRE provides anexception to the general rule by allowingthe title of Malay holding land to bedeposited to: (i) in favour of Menteri Besar; (ii) any such co-operative societyregistered under the Co-operativeSocieties Act 1948; (iii) any such person specified in theSecond Schedule.
06/14/13 Ainul Jaria Maidin 2013 109Granting of Power of Attorney There is clear prohibition in FMS MRE s 9on the creation of power of attorney infavour of a Non-Malay to act on behalf of aMalay proprietor to transfer, charge orlease of a MRL or Malay holding. Suchmemorandum shall be declared as void andshall not be capable of registration. Theexception to this general rule is that aspecific power of attorney could becreated on Malay holding or MRL if it dealswith cross transfer and alteration orvariation of conditions.
06/14/13 Ainul Jaria Maidin 2013 110 In pre-Merdeka case of Gan Khor vSoan Bin Pelita  FMSLR 39the Judge had avoided to discuss theissue whether the power of attorneycreated in favour of the non-Malaywas valid or not under the 1913 MRE.However, FMS MRE 1913 s 8(ii)speaks that the power of attorneybetween Malay and non-Malay isrevocable.
06/14/13 Ainul Jaria Maidin 2013 111 in Idris Bin Haji Mohamed Amin v.Ng Ah Siew  FMSLR 70 atp77, the Appeal Court held that asthe power of attorney relates to aright and interest in land, thereforeit is in contrary with the spirit of theMRE and cannot be enforced.
06/14/13 Ainul Jaria Maidin 2013 112 In the subsequent case of Sakinah v.Kua Teong How  FMSLR 246,Howes J. approved the above casethat the power of attorney purportedto give the chargee a right orinterest on the land, and as such wascontrary to the provision of s 8(i) of1913 MRE.
06/14/13 Ainul Jaria Maidin 2013 113Bankruptcy No Malay holding shall vest in theOfficial Assignee upon the registeredproprietor being declared bankruptaccording to FMS MRE s.12, unless,the registered proprietor is declaredbankrupt prior to the coming intoforce of the MRE.
06/14/13 Ainul Jaria Maidin 2013 114Attachment in Execution “No Malay holding shall be attached inexecution of a decree or order of anyCourt unless the suit or proceeding inwhich such decree or order was madewas instituted before thecommencement of this Enactment.”
06/14/13 Ainul Jaria Maidin 2013 115 However, in pre-Merdeka case, TheOfficial Administrator v. Haji AbdulMajid bin Shakabudin  FMSLR 75,76, the court held that there is nothing toprohibit the administrator from selling theMRL and using the purchase money to payoff the creditors whatever their race are.The only prohibition is that the land couldonly be sold to Malay.
06/14/13 Ainul Jaria Maidin 2013 116Restriction as to Creationof Trusts Generally, no trusts could be createdor enforced by Non-Malay on Malayholding or MRL. By applying the literalinterpretation, one can safely assumethat the provision does not mentioneither expressly of impliedly anyprohibitions against the appointmentof non-Malay trustee.
06/14/13 Ainul Jaria Maidin 2013 117Grants of Probate andLetters of Administration There is clear prohibition that nogrant of probate or of letters ofadministration shall operate to vestand Malay holding or Malayreservation in any executor oradministrator who is not Malay. SeeFMS MRE s 15.
06/14/13 Ainul Jaria Maidin 2013 118Consequence ofContravention of MRE i. Avoidance of Dealing ii. Risk Forfeiture by the State
06/14/13 Ainul Jaria Maidin 2013 119 in Idris Bin Haji Mohamed Amin v.Ng Ah Siew  FMSLR 70 saidthat ‘the obvious intention of theEnactment was to secure for Malaysonly land comprised in Malayreservations.’
06/14/13 Ainul Jaria Maidin 2013 120 Therefore, in the FMS MRE s 8(i) it isprovided that dealings that infringe thelaws shall not be capable of registration.Furthermore, those dealings that arecontrary to the MRE, shall be declared asnull and void in almost all the FMS MRE s19(i) In addition, no action for breach ofcontract shall lie in respect any dealing ordisposal or any attempt to deal in ordispose of any Malay holding contrary tothe provisions of the FMS MRE 19(ii) Inaddition, any rent paid in pursuance of thecontrary dealing would not be recoverablein the Court see FMS MRE 19(ii).
06/14/13 Ainul Jaria Maidin 2013 121Risk Forfeiture by theState “If at any time it shall appear to thesatisfaction of the Ruler-in-Council thatany Malay or Siamese has attempted tovest in any person any Reservation landheld by him under any document of title,contrary to the provisions of MRE S 6, theRuler-in-Council may, by order in writing,signed by the Menteri Besar, direct allinterest of such Malay or Siamese as thecase may be,
06/14/13 Ainul Jaria Maidin 2013 122 in such land shall be forfeited and upon theregistration of such written order in themanner prescribed in Enactment No.56(Land) such land shall vest in the Sultanabsolutely; provided that one month’snotice to show cause against suchforfeiture shall have been served uponsuch Malay or Siamese, as the case may be,and cause shall not have been shown to thesatisfaction of the Ruler-in-Council withinthe period prescribed in the notice.
06/14/13 Ainul Jaria Maidin 2013 123 Before Ruler-in-Council can forfeit theMRL, he must make sure that: a. The Malays or Siamese has attempted tovest the Reserve land to Non-Malay or toall those Malay companies, which have notbeen declared as Malay. b. It is a MRL held under document of title. c. The dealing is contrary to the MRE d. Order shall be in writing, signed by theMenteri Besar;
06/14/13 Ainul Jaria Maidin 2013 124 e. Follow procedures prescribed inNLC f. One month notice to be given toproprietor to show cause why the saidland could not be forfeited. g. The Ruler-in-Council unsatisfiedwith the reason given. h. Forfeiture takes effect.CHAPTER 142.docx