This document discusses the concept of indefeasibility of title (IoT) under Section 340 of the National Land Code. It contains the following key points: 1. Section 340 establishes that the title or interest of a registered proprietor is indefeasible, subject to certain exceptions. These exceptions include fraud, misrepresentation, forgery, insufficient or void instruments, and unlawfully acquired titles. 2. IoT can take two forms - immediate indefeasibility where registration confers a guaranteed title, or deferred indefeasibility where the title remains potentially open to attack until transferred. Malaysian law follows the doctrine of deferred indefeasibility. 3. Subsequent purchasers who acquire

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PM Dr Jady
jady@ukm.edu.my
14 November 2019
Indefeasibility of Title (IoT)
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Scope of
s. 340
s. 340 (1)
s. 340(2)
s. 340(3)
Concept
Categories
Issues
Limitation Period
Adverse Possession
s. 340(2)(a)
s. 340(2)(b)
s. 340(2)(c)
Fraud
Misrepresentation
Forgery
Void Instrument
Unlawfully acquired
s.340(3)(a)(b)
Proviso
s. 340(4)
Power of forfeiture
or OFS (Order)
Operation of law
PBN/Court
s. 4(2) Customary/
Islamic Law
s. 380 -
Registrar
s. 417 -
Judge
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Subsequent purchaser
“Any” Bona Fide Purchaser

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DIVISION 5, PART 20 - s. 340(1)
Concept Title or Interest
Any person/body
Proprietor
Whose name
registered
WHAT?
Definition
Frazer vWalker A convenient of the immunity from attack by adverse
claim to the land or interest
Title to the land – statutory estate
Interest in the land – statutory interest
s. 205(2), s.43 and s. 433A
Include s. 342, s. 344 and s. 345
The proprietor of the interest (lessee,
chargor, easement) upon registration
renders the land liable to legal or
statutory interest .
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Alienation s. 92 (1)
-final title
Registered Dealing s. 92(2)(c) (transfer etc) read with s. 89 (conclusiveness)
Teh Bee v K. Maruthamuthu – any alienated land approved by
PBN when registered becomes indefeasible and remains
so unless and until declared otherwise by the court. (Read
s. 180)
Read :YapTeck Ngian v Mobile Oil Msia Sdn Bhd – being an administrator of the estate
cannot claim ownership or right over the land.
How IOT
Effective?
When?
Muhammad bin Buyong v Pemungut HasilTanah Gombak [1982] 2 MLJ 53
Registration by Collector merely directory and not mandatory. The making of a
prescribed memorial of the dealing is under his hand and seal of the registering
authority. If no, there would be no registration. – DavidWong, p. 319
M & J Frozen Food Sdn Bhd v Siland Sdn Bhd [1994] 1 MLJ 294
On registration and after the issuance of a certificate given under s. 259(3)(a).

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5
Category
Immediate
Deferred
Test
Frazer vWalker [1967] 1 AC 569
Doshi vYeohTiong Lay [1975] 1 MLJ 85
Boonsom Bonyanit (FC)
Boonsom Bonyanit (COA)
M&J Frozen Food v Siland
Muhammad b.Buyong v PHT Gombak
the validity of the instrument prior to registration (new)
He registers as proprietor using valid
instrument, then the register establish his
title (state guaranteed)
He registers as proprietor but subject to s.
340(2)
3rd party bona
fide purchaser
Effect: valid
transaction /
IOT
Effect: registered but he
is liable to be displaced
only by other
statutory exceptions
or equity.
Effect: registration has removed
imperfection in that instrument –
the issue of validity of instrument
is immaterial
Proprietor
Immediate
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why IMMEDIATE IOT
Frazer vWalker [1967]
1 AC 569
Registration ..confers upon a registered proprietor a title; immune
from adverse claims.
Right of a plaintiff to bring claim in personam is allowed but not
caveated
s. 7 Registration ofTitles Regulation 1891 (Selangor)
‘ certificate issued by Registrar upon a genuine transfer shall be taken to the court as conclusive evidence; that the
person named therein as proprietor is the absolute and indefeasible owner’.
Doshi v YeohTiong Lay
[1975] 1 MLJ 85
Read the fact: s.42 of Land Code
The registration of the transfer to the respondent was effective to
vest title in him as a registered proprietor notwithstanding that he
acquired his interest under an instrument that was void.
Boonsom Bonyanit
[2001] 2 CLJ 133 FC
Read the fact: forged documents
Federal Court panel (Eusoff Chin CJ, Wan Adnan CJ and Abu
Mansor FCJ held that a registered proprietor (purchaser) obtains
immediate indefeasibility..even if the instrument of transfer was
forged.

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Read the fact: forged power of attorney and forged instrument of
charge. Registered owner not aware until after 3rd party issued
notice of demand. FC misconstrued s. 340 and gave recognition to
the concept of immediate IOT. Once it was satisfied the charge
using void instrument, it automatically be set aside.
why
DEFERRED IOT
s. 42 FMS Land Code 1928
A registered proprietor may himself have a title which is impeachable and yet
be able to give an unimpeachable title to a bona fide purchaser for value.
Boyd v Mayor ofWellington
[1924] NZLR 1174
Salmond J:Void instrument remains equally null until the rights of
third person purchasing in good faith and for value.
Dixon J:A prior registered estate or interest ..is not destroy unless
afterwards a persons, gives a registrable instrument which is taken
bona fide for value and registered.
Clements v Ellis [1934] 51
CLR 217
M&J Frozen Food v Siland
[1994] 1 MLJ 294
Read the fact: public auction
Conclusion of certain aspects of the sale ..but the proprietary right
has yet to be conveyed from the vendor to the purchaser.
Muhammad b.Buyong v
PHT Gombak [1982] 2 MLJ
53
Read the fact: Form 14A presented and recorded but no original
IDT – Collector (A) decided to reject the instrument
Appellant cannot claim IOT since there is no registration.
TanYing Hong vTan Sian
San [2010] 2 CLJ 273
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Point to ponder: whether 340 provides for deferred or immediate indefeasibility?
HashimYeop A Sani J in Mohammad bin Buyong v Pemungut HasilTanah Gombak & Ors, [1982] 2
MLJ 53 ‘... The doctrine carried in s 340 is the doctrine of indefeasibility.What that section protects is that the
title or interest of any person for the time being registered as proprietor of any land shall be
indefeasible. Subsection (2) of the section provides for the exceptions in that the title or interest shall not be
indefeasible in any case of fraud or misrepresentation or where registration was obtained by forgery or by means of
an insufficient or void instrument or where the title or interest was unlawfully acquired.This provision deals with
what is called deferred indefeasibility ...’
Judith Sihombing in her article 'Indefeasibility' [1979] 1 MLJ explained:
‘The principle of deferred indefeasibility means that on registration the title of the registered owner obtained,
without fraud, remains potentially open to attack, if certain circumstances exist, until the title is
transferred to another’.
David Wong,Tenure and Land Dealings in the Malay States (p. 346) stated that: 'Section 340 clearly
admits of no room for argument in favour of immediate defeasibility'. And in p. 348, '... many
Torrens systems have gone the way of Frazer vWalker [1967] 1 All ER 649 [meaning immediate indefeasibility],
while the MalaysianTorrens system stays quite apart at the extreme end of the other direction'.

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IOT 2: Exceptions – s. 340(2)
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s. 340(2)
(a)
(b)
fraud
(c) Unlawful acquired
Insufficient / void instruments
misrepresentation
forgery
(1)Statutory
(2) Equity
Kesarmal&AnorvValliappa
Chettiar
liabletobedefeated
(3) Custom and Islamic Law
(4) Power of StateAuthority
s. 206(3)
ContractAct1950,
Specific ReliefAct1950
Equitable Right
Equitable Charge
Equitable Lien
Equitable Lease
Tenancy Coupled with Equity
s. 4(1)
Acquisition of land
Forfeiture
EXCEPTIONS
Oh Tiam v Tham Kong

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Concept
To set aside IoT, the applicant must have locus standi
Cheng Hang Guan v Perumahan Farlim (Pg) S/B
s.340(2)(a)
1.Fraud
2.misrepresentation
Actual fraud and not constructive
to defeat a person title / interest
- Intention to cheat (dishonest)
-The person is party or privy to
fraud
Assets Co v Mene Roihi (1905) PC
Tai Lee Finance v OA [1983] 1 MLJ 81
(FC) – constructive fraud
Datuk Jaginder SinghVTara Rajaratnam
[1983] – actual fraud
Interest
Onus Saminathan v Pappa
Boonsom Boomyanit (COA)
Beyond reasonable doubt
Balance of probabilities
Registered Interest
Unregistered Interest
Dashi vYTL
LokeYew v Port Swettenham Rubber Co
Datuk Jaginder SinghVTara Rajaratnam Fraudulent misrepresentation
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s.340(2)(b)
3.Forgery
4. Insufficient
Instrument
Forgery makes the instrument void
Instrument unfit for registration for not fulfill conditions s. 301
Instrument not attested
Boonsom Boomyanit (COA)
forgeryAND void instrument Separate cause of action / proof
OCBC Bank (M) BhdV Pendaftar
Hakmilik,Negeri Johor DarulTakzim
[1999] 2 MLJ 511
Instrument not stamped
Puran Singh v Kehar Singh
Minor executed instrument Tan Hee Juan vTeh Boon Keat
X approved by PBN – breach of
restrictions
UMBC v Sy.Perumahan Luas
No.2 [1988] 3 MLJ 352
5.Void Instrument
Pemalsuan

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s.340(2)(c)
PBN abuses the statutory power
(ultra vires)
UMBC v Sy. Perumahan Luas
No.2 [1988] 3 MLJ 352
Invalid power of attorney
Title or interest is obtained
through non-compliance of NLC
provisions
Registration by any power / authority conferred by law, and was obtained through the following:
M & J Frozen Food v
Siland S/B
D & C Commercial Bank v
Kim Ming Choon
Example: If PBN abuses power /
non compliance of NLC
Registration not conferred
Registration of certificate
for Order for Sale despite
of late payment
Wrong procedure of
Order for sale
6. Illegally acquired
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s.340(3)
s.340(3)
Subsequent Purchaser
s.340(3)(a)(b)
Proviso
s.340(3)
Where a registered title or interest is rendered indefeasible [s.
340(2)]...
Subsequent transfer of title is STILL liable to be set aside [s.340(3)
(a)] and any interest subsequently granted is STILL liable to be set
aside [s.340(3)(b)].
The protection is ONLY for (next) subsequent purchasers who
acquire title or interest in good faith and for valuable consideration
Kamarulzaman Omar vYakub Husin [2014] 2 MLJ 768 (Fed Crt-Putrajaya)
A defeasible title or interest continues to be defeasible and only become
indefeasible when title is acquired by a subsequent purchaser in good faith and
for valuable consideration, OR by any person or body claiming through or
under such a purchaser.

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s.340(4)
s.340(4)(a)
Determination/Termination
s.340(4)(b)
Power of Forfeiture
Operation of Law
Order For Sale
Any other written law –
i.e. BankruptcyAct
Determination
PBN – s.380
s. 4(2) Customary/
Islamic Law
Court – s.417
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s. 341 - Limitation Period
to ClaimTitle/Interest
s. 9 LimitationAct 1953
Ng Chim & Ors v Low Boon Beng [1994]
s. 340(1) – for the time being registered
s. 341 – by the proprietor...accordingly,
LimitationAct 1953 [s. 9(2)(b)] to any person
registered under NLC..; read with s. 5, means
any person or body for the time being
registered...
The claimant
must currently
be the
registered
proprietor
Concept
Within time
limit
Limitation of actions to
recover land – after the
expiration of 12 years.
s. 21 LimitationAct 1953
Limitation of actions to
recover money secured by
charge / sale of land - after
the expiration of 12 years.
Tan Kong Min v Malaysian Nat.Insurance Sdn Bhd
[2006] 1 MLJ 601
s. 21(1) refers to action in personam; s. 21(2)
refers to foreclosure action in respect of
mortgaged property (in rem)
Adverse
Possession
s. 48 NLC – no title to State land shall be acquired by possession, unlawful
acquisition or occupation under any licence for any period.
Nik Ibrahim Abdul Rahman v PentadbirTanah Jajahan Gua Musang [2001] 5 MLJ 59

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TUTORIAL
1. Discuss the followings:
(a) whether the concept of indefeasibility as adverted to in s. 340
NLC referred to immediate or deferred indefeasibility;
(b) whether the proviso to sub-s. (3) of s. 340 NLC applied only
to that subsection, and not to the provision of sub-s. (2);
(c) whether the Federal Court inAdorna Properties had
misconstrued the provisions of sub-ss. (2) and (3) of s. 340
NLC;
(d) whether the ruling inAdorna Properties was no longer good
law and therefore it was wrong of the Court ofAppeal below
to have followed it.
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— Discuss the following cases:
— Ong Lock Cho v Quek Shin & Sons – forgery
— Puran Singh v Kahar Singh
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