This document discusses conditions and restrictions on land under the National Land Code 1965. It defines implied conditions for agricultural, building, and industrial land regarding allowed uses and timelines to commence activities. Express conditions and restrictions in interest can be imposed by the State Authority. Breach of conditions can result in forfeiture of the land to the State. The State Authority also has options to impose fines or temporarily take possession in lieu of forfeiture in some cases.

1. REM 159
LAW OF PROPERTY
CHAPTER 6
CONDITIONS AND RESTRICTION.

2. LEARNING OUTCOMES
At the end of this topic students are expected to be
able to:
 Ability to understand the concept of condition and
restriction under National Land Code (NLC) 1965
 Ability to differentiate express condition, implied
condition and restriction in interest.

3. IMPLIED CONDITION
Implied
Condition
Agriculture
(S115)
Building
(S116)
Industrial
(S117)

4. INTERPRETATION - AGRICULTURE
 Sec 5, NLC 1965
 "agriculture" includes the cultivation of any crop
(including trees cultivated for the purpose of their
produce), market gardening, the breeding and
keeping of honey-bees, livestock and reptiles, and
aquaculture;

5. IMPLIED CONDITION – AGRICULTURE LAND
Section 115 (1)
(1) Where any alienated land is subject by virtue of any
provision of this Act to the category "agriculture", the
following implied conditions shall, subject to sub-section (3),
apply thereto-
(1) no building shall be erected on the land other than a building or
buildings to be used for one or more of the purposes specified in
subsection (4);
(2) a bona fide cultivation of the land shall commence on the land
within 12 month of the relevant date, i.e. the date the land is
made subject to the category of agriculture
(3) the whole area of the land, other than any part thereof which is
occupied by or in conjunction with a dwelling house is brought
fully under cultivation within three years of the relevant date
(4) the area of the land shall be maintained and cultivated according
to the rules of good husbandry; and
(5) The area shall be continuously cultivated:

6. IMPLIED CONDITION – AGRICULTURE LAND
 Section 115 (4)
 The purposes referred to in paragraph (a) of sub-section
(1) are the following-
 Dwelling house for the proprietor or his servants engaged in
agricultural work (provided that the size of the area so utilized
shall not exceed 1/5th of the land or two hectares whichever is
lesser)
 Extracting or processing raw material from any agricultural
produce
 Preparing for distribution any such material or produce, or any
livestock or fish, or the produce of any livestock
 Providing educational, medical, sanitary or other welfare
facilities
 Any other purpose which the SA may deem fit to authorize in
the circumstances of any particular case

7. INTERPRETATION - BUILDING
 Sec 5, NLC 1965
 "building" includes any structure erected on land;

8. IMPLIED CONDITION – BUILDING LAND
 Section 116 (1)
 a building must be erected on the land within two years of
the relevant date, i.e. the date the land is subject to that
category;
 no part of the land shall be used for agriculture or
industrial purposes;
 every building thereon shall be maintained in repair;
 no such building shall be demolished, altered, or
extended without the prior consent in writing of the
appropriate authority

9. IMPLIED CONDITION – BUILDING LAND
 Section 116 (4)
 The permitted purposes for which a building can be
erected on the land are
 residential purposes
 administrative or commercial purposes
 purpose of exhibiting, selling by retail, repairing or
otherwise dealings in any goods or commodities, or of
providing any services
 purposes of providing any educational, medical, sanitary
or other welfare facilities
 purposes of entertainment, refreshment or recreation
 any other purpose deemed fit by the state authority

10. INTERPRETATION - INDUSTRIAL
 Sec 5, NLC 1965
 "industrial purposes" has the meaning assigned
thereto by paragraph (a) of sub-section (1) of section
117;

11. IMPLIED CONDITION – INDUSTRIAL LAND
 Section 117 prescribes that the lands shall be used
only for industrial purposes, for the purposes of
erection or maintenance of factories, workshops,
foundries, warehouses, docks, jetties, railways or
other buildings or installation for use for, or in
connection with, one or more of the following
purposes :
 manufacture
 smelting
 the production of power
 the storage, transport or distribution of goods or other
commodities
 such other purposes as may be prescribed by the State
Authority

12. IMPLIED CONDITION – INDUSTRIAL LAND
 Section 117 also prescribed that
 industry shall commence its operation within three years
of the relevant date
 every building or installation erected thereon shall be
maintained in repair.
 no such building or installation shall be demolished,
altered or extended without the prior written consent of
the appropriate authority

13. Lands Alienated before NLC
 Section 53 provides until a category of land
imposed under section 54, the land shall be
subjected to implied conditions as follows :
 Country, town or village land under Land Office title,
will be subjected to an implied condition for
agricultural purposes
 Other land (town & village land) under Registry titles
will be subjected to an implied condition that it shall
not be used either for agricultural or industrial
purposes
 Case Garden City Development Berhad v
Collector of Land Revenue, Federal Territory

14. Express Conditions &
Restrictions in interest
 Section120
 Empowers State Authority to impose express
conditions & restrictions in interest
 These condition and restrictions are determined by
the SA at the time the land is approved for alienation
 Must be endorsed on or referred to in the document
of title of the land

15. PENGARAH TANAH DAN GALIAN,WILAYAH PERSEKUTUAN
v. SRI LEMPAH ENTERPRISE SDN. BHD [1979] 1 M.L.J 135
 The Respondents owned a piece of land in the Federal
Territory, held in perpetuity. The Company had applied to
the authorities for sub-division and conversion of their
land for the purposes of constructing a hotel thereon.
 Approval was given subject to the conditions, inter alia,
the respondents must agree to accept back a lease for
99 years in exchange for their Property.
 The company rejected the conditions and applied to the
High Court for an order that the authorities approve their
application subject to the usual terms and condition.
 The Federal Court upheld the decision

16. Express Conditions &
Restrictions in interest (cont’d)
 Determined by State Authorities at time of alienation
 Must be endorsed on or referred to in the document of
title
 May require continuous performance or subject to fixed
term
 Bind with land
 Bind with the Proprietor
 If in conflict with Local authority by-laws, conditions shall
prevail
 Every condition or restriction in interest commence from
the date of alienation

17. Dr. Ti Teow Seow & Ors. v. Pendaftar Geran-Geran
Tanah Negeri Selangor (1982) 1 MLJ 38
 Restriction in interest “could not be transferred or
leased for 15 years without the consent of the
Ruler in Council
 Date of commencement of title-18/8/1964
 Date of alienation-9/11/1967
 Sold the land-25/3/1980
 MOT executed -5/5/1980
 Registration of MOT rejected-restriction in
interests still subsisting

18. Dr. Ti Teow Seow & Ors. v. Pendaftar Geran-Geran
Tanah Negeri Selangor (1982) 1 MLJ 38
S. 78(3) NLC
“ The alienation of State land shall take effect upon the
registration of a register document of title
thereto…and, notwithstanding that its alienation has
been approved by the State Authority, the land shall
remain State land until that time.”

19. Breach of Conditions
 Section 125
 Divided into 2 :
 Non-payment of quit rent
 The breach of implied or express conditions
 if any condition consists of two or more separate
obligation or liabilities-failure to fulfill any of those
obligation or liabilities shall constitute a breach of
condition

20. LIABILITY TO FORFEITURE
FOR BREACH OF CONDITION
 S127-Any breach of any condition to which
alienation land is subject –become liable to forfeiture
to the State Authority

21. EFFECTS OF FORFEITURE
 Section 131
 The land shall revert to and vest in, the State
Authority as State land, freed and discharge from
all titles and interests subsisting
 Shall also vest in the State Authority, without
payment of compensation, any building existing
on the land
 Any item of land revenue then due to the State
Authority in respect of the land shall be
distinguished

22. OPTIONS TO FORFEITURE
 By an amendment in March 25, 1985 the SA has two
more courses of action
 S127(1A) &(1B)-Imposing a fine on the Proprietor
not less than RM500 and in the case of a continuing
breach, a further fine of not less than RM100 for
each day during which the breach continues
 S129(4) State Authority can take temporary
possession of the land with a view to remedying the
breach itself at the State expenses.

23. FORFEITURE
 In any case, if the Proprietor has been able to
remedy his breach in due time after being notified by
the State Authority, forfeiture proceedings will not be
continued against him
 Forfeiture shall take effect upon notification in the
Gazette.
 Land administrator as soon as may be after the
notification is published, register or cause to be
registered a memorial thereof