The document summarizes key aspects of land acquisition law in Malaysia, including: 1) The finality of the Land Administrator's award of compensation and circumstances where it can be challenged. 2) How compensation is assessed based on market value principles and other factors in the First Schedule such as severance. 3) The process for objecting to a land acquisition award, including statutory criteria for locus standi, grounds for objection, and procedures upon filing an objection. 4) Case law addressing issues like delays invalidating acquisitions, standards for determining compensation amounts, and constitutional challenges.

1. LAND ACQUISITION 2
Sharifah Zubaidah
LAW 3111- March 2009

2. Coverage:
• 1) Award of Compensation
• 2) Assessment of Compensation
• 3) Challenging Land Acquisition Proceedings
• 4) Special Provisions for Acquisition by Private
Sector

3. Award of Compensation

4. Finality of Award of Compensation
• See s.14(2) LAA.
• Every award prepared…shall be final and
conclusive evidence of :
• 1) the area of any scheduled land,
• 2) its value in the opinion of the LA,
• 3) apportionment of the compensation awarded.
• See however s.37, giving a right to persons
interested to apply to court to object against the
amount of compensation.

5. Issue: Whether the LA must give
reasons for his award?
• PHT Daerah Barat Daya Pulau Pinang v Kam
Gin Paik [1983] (FC):
• No, so long as there is an award made in Form
G, there is no need for the LA to give reasons for
his award. (See s. 14(2) – finality and
conclusiveness of award.)

6. Can a person object if area of land is
actually larger than the area assessed?
• See s.14(3) LAA.
• Any difference in the area of land assessed will
not invalidate the award unless the difference is
larger than ¼ of a hectare or 1% of the
scheduled land, whichever is greater.

7. Oliver Young v CLR Batu Pahat [1972]
• Issue: Whether it was proper for one Collector to
hold the enquiry in the acquisition proceedings
and for another to make the award?
• Held:
• From s.12 LAA, the Collector who conducts the
enquiry must assess the compensation.
• Thus, the assessment of award was invalid and
there should be an new enquiry done by another
Collector.

9. Assessment of Compensation
• The assessment of compensation to be awarded
is done by referring to Principles Relating to the
Determination of Compensation in the First
Schedule. (Please refer.)
• 4 Matters:
• 1) ‘Market Value’.
• 2)Matters to consider.
• 3) Matters to neglect.
• 4) Limitation.

10. How is Market Value Ascertained?

11. Market value as of when? (para. 1(1))
• ‘Reference date’:
• a) Date of publication of Form A. (if followed 12
months thereafter by Declaration under s.8);
• b) In any other cases, at date of publication s.8
Declaration.(Form D)

12. Method of Valuation? (para. 1(1A))
• ‘any suitable method’.
• May refer to prices paid
for recent sales of lands
with similar
characteristics as the
scheduled land within
same vicinity, particularly
the last transaction
within 2 years of the
reference date.

13. Other Matters as regards Market
Value:
• If part only of land is acquired,
refer to market value of whole
land but consider also
particular features of that part.
(1B)
• If leasehold property can have
regard to date of expiry of
lease but not any subsequent
alienation. (1D)
• Must consider any implied or
express condition restricting
the use of land. (1(2))
• If Malay Reservation land or
Malay holding or customary
land – such status not to be
considered. (1(2A)
• Must consider specific land
use of land as indicated in the
development plan prepared by
the town planning authority.
(1(2BA))

14. 1st
Schedule Now Recognises the
Reinstatement Principle
• In Lembaga Amanah Sekolah
Semangat Malaysia v CLR
Dindings [1978], the school
(OBS)objected to the amount
of compensation and argued
that the principle of
reinstatement should be
applied – the cost of placing
the claimant in the same
position to that he occupied
when he was dispossessed.
• Held: The LAA does not
provide for the reinstatement
principle.
• Now, it does. See para 1(2C) –
added in 1998 Amendment.
• If land is presently used for a
purpose that has no general
demand/market for the
purpose (e.g. training centre,
recycling centre, etc.)
assessment shall be made on
the basis of reasonable cost to
the proprietor of using or
purchasing other land for the
same purpose.

15. Outward Bound School, Lumut

16. Definition and Concept of
Market Value
• Defined in Nanyang Manufacturing Co. v CLR
Johor [1954]:
• “The market value of the land may be roughly
described as the price that an owner willing and
not obliged to sell might reasonably expect to
obtain from a willing purchaser with whom he
was bargaining for the sale & purchase of land.”
• (per Buhagiar, J.)

17. Ng Tiou Hong v CLR Gombak [1984]
• Federal Court observed:
• 1. Market value means the compensation must
be determined by reference to the price a
willing vendor might reasonably expect to
obtain from a willing purchaser.
• 2. Market price can be measured by considering
the price of sales of similar lands in the
locality.

18. Cont.:
• 3) Its potentialities must be taken into account.
i.e. land use and future development
potential. (See also Bukit Rajah Rubber Co. v
CLR Klang [1968] on this point.)
• 4) The location of the land, whether near a
developed town, access roads, etc.
• 5) Estimates of value by experts.

19. Syed Agil Barakbah in
Ng Tiou Hong:
• “the elements of unwillingness or sentimental
value on the part of the vendor to part with the
land and the urgent necessity of the purchaser to
buy have to be disregarded and can’t be the basis
for increasing the market value.”

20. Matters to Be Considered In Determining
Compensation in 1st
Schedule
• 6 Factors:
• a) Market Value
• b) Increase in value of other land belonging to the
person as a result of acquisition.
• c) Severance
• d) Injurious affection
• e) Forced change of residence or place of business.
• f) Where only part of land is acquired, an undertaking
to build roads, drains, walls, fences, etc. benefitting
part of land not acquired.

21. CLR v Looi Lam [1981] 1 MLJ 300
• Govt acquired part of the Resp.’s land to change
the course of Sg. Benus that passed through Kg.
Bahru.
• As a result of the river deviation work done by
the Govt. after the acquisition, the house
belonging to the Resp. was badly damaged and
required extensive repair.
• No compensation was paid in the award for
damage to the house.

22. • Resp. applied to the court which then awarded a
further RM8101 as compensation for severance
damage and a further RM40, 185 as
compensation for damage of the house.
(‘injurious affection’).
• Court referred to para 2(d) of First Schedule:
“damages likely to be sustained” – thus, may
claim.

23. Consolidated Plantation Bhd. V Pemungut
Hasil Tanah Kelang [1984] 1 MLJ 273
• Govt acquired a portion of the land belonging to
the appellant co. for a housing scheme.
• At the enquiry, the app. Co. asked for a total
compensation as follows:
• a) value of land.
• b) diminished value of land not acquired.
• c) accomodation
• d) loss of water supply and consequential
closing down of mill.

24. • e) surveyor’s fee.
• Collector’s award only on market value and
nothing else.
• High Ct. allowed claim for b, d and e as there
was no dispute as to the injurious affect of the
acquisition on the App.’s oil palm mill as they
lost a part of the catchment area for their water.

25. 6 Matters to be Neglected in
1st
Schedule:
• a) degree of urgency
• b) disinclination of the
person to part with
the land.
• c) damage sustained
that will not be a good
cause of action.
• f) Outlays, additions,
improvements to the
land after Form D
is gazetted.
• d) depreciation in value
of land likely to result
from the use it is
acquired.(e.g. solid
waste site)

27. Can a person accept compensation
under protest?
• Yes, see s.30(a) and s.37(1) LAA 1960.
• Such application to refer the matter to the court
must be made within 6 WEEKS of the LA’s
award (if applicant was present) and is made in
Form N under s. 38 LAA.
• The grounds of the objection must be stated fully
in Form N. (s. 38(2))

28. Locus Standi to File Objection
• S. 37(1) states :
• “any person interested who… has received any
notice under ss. 10 or 11 … has made a claim to
the LA in due time and who has not accepted the
LA’s award/ has accepted under protest…”
• Thus, the claimant must fulfill the following
criteria:

29. Statutory Criteria:
• 1) Must be ‘a person interested’ (see s.2)
• 2) Must have received the notices in either s. 10
or 11. (Form E or Form F)
• 3) Must have made a claim to the LA in due
time (see s. 38) as regards objecting to the
award or accepting the award under protest.
(s. 30).

30. ‘person interested’ (s.2)
• “Includes every person claiming an interest in
compensation to be made on account of
acquisition of land under this Act but does not
include a tenant at will.”
• CR: s. 37(3) LAA as regards a government
agency/company undertaking work of public
utility where award exceeds RM15,000.

31. Lembaga Lebuhraya Malaysia v Cahaya
Develpmt S/B (COA) [2011] 2 MLJ 729
• P’s land acquired u-
s.3(109a) for public
purpose to build the
Senai-Pasir Gudang-
Desaru Expressway.
• Form D stated that the
acquisition was for the
Ministry of Public Works.
• RM30 million plus was
awarded as
compensation.
• D’ raised objection to the
amount of compensation
as they (LLM) had been
given responsibility to
supervise and execute the
project.

32. Cont.:
• P contended that the D
was not a ‘person
interested’ and thus may
not file an objection.
• HC held that as the
acquisition was not made
under s. 3(1)(b), therefore
the D was not a ‘person
interested’ to file an
objection.
• D appealed to COA’
• COA held:
• “As the ‘paymaster’ of the
highway project, and
being served with Form E
as a person interested,
and read with s. 37(3)
LAA, the App. was a
person interested that
was entitled to make a
claim.”

33. Grounds: (s. 37(1))

34. Whether the period of 6 weeks to file Form
N in s. 38(4) can be enlarged by the court?
• Yes, if the applicant can
show ‘special
circumstances’.
• See: Singapore Para
Rubber Estate Ltd. v PTD
Rembau, Negri 9 [2008]
6 MLJ 763
• App. had accepted
compensation under
protest as to its amount
and filed Form N but it
was out of time.
• Issue:
• Whether the Resp.’s non-
compliance with certain
statutory requirements
under the Act and Article
13 of the FC when making
the award constituted
‘special circumstances’
entitling the court to
enlarge the time for
submission of Form N?

35. Held:
• The burden was on the App. to establish ‘special
circumstances’ thereby entitling the court to
exercise its discretion to enlarge time under s.
38(4) of the Act.
• This discretion must be exercised sparingly.
• No special circumstances in this case.

36. Procedure upon Receipt of Form N
• 1) LA will require a deposit from the applicant
of either RM3000 or 10% of the amount
claimed as security for costs of reference and
appeal. (s.39(1))
• 2) LA will refer the matter to the court within 6
months through Form O.
• 3) Court will issue Form P (s. 43) notifying the
applicant, the LA and all interested persons
on the date hearing.

38. Draman b. Kassim v Land Administrator,
Hulu Terengganu [1990] 3 MLJ 465
• App.’s MR land ws acquired for a ‘store site for
the PWD of Hulu Terengganu.’
• App. dissatisfied with the quantum of
compensation as 2 parcels of land in the same
district had been rejected as comparisons to
determine market value.
• HC increased the compensation fr RM4800 per
acre to RM7000 per acre. App. Appealed to the
SC for RM16000 per acre. Appeal dismissed.

39. Jitender Singh v PTD Wilayah
Persekutuan [2008] 7 MLJ 479
• Held:
• Where the court is aided with 2 valuers and both
valuers had applied similar factors to assess
compensation, the court should elect to adopt
the valuation in favour of the landowners.
Consonant with spirit of Art. 13 of the Federal
Consti.

40. Other grounds from case law:
• 1) Delay in holding
enquiry.
• 2) Delay in making
award and
payment.
• 3) Ultra-vires the
constitution.
• 4) Breach of natural
justice.
• 5) Non-compliance
with the Act/ legal
impropriety.
• 6) Acquisition was
‘mala fide’.

41. Judicial Review
• Applications under grounds other than s. 37, is
done by way of judicial review.
• Usually application is for a declaration and a
writ of certiorari to quash the decision of the
State Authority to acquire the said land.

42. Delay in making enquiry
• Oriental Rubber & Oil
Palms S/B v PHT
Kuantan [1983]
• Form D was gazetted in
1975 but enquiry was only
held 5 years later. (1980).
• App. applied for
certiorari to quash the
award.
• Held:
• Court granted certiorari
to quash the award.
• The delay caused Form D
to be exhausted and of no
effect.
• See also: PHT Daerah
Barat Daya P. Pinang v
Ong Gaik Kee (7 years
delay – certiorari granted
to quash award.)

43. Delay in Payment of Award
• Tan Boon Bak & Sons
Ltd. V Govt of the State of
Perak & Anor. [1983] 1
MLJ 117
• P sued the State of Perak
and the CLR, inter-alia,
on the ground that the
unreasonable delay on
the part of the Collector
in making payment of
compensation awarded
by him contravened
• S. 29(1) of the LAA 1960
and Art. 13 Federal
Constitution.
• There was a delay of 7
years.
• Ajaib Singh, J.: ‘As soon
as may be’ in s. 29 should
be read as meaning..’as
soon as he is in a position
or is able to do so.’

44. Held:
• As in this case the sum awarded was to come
from the Perak State Economic Development
Corporation (SEDC) and it was in the process of
reorganisation, the delay did not render the
acquisition void.
• Special circumstances of the case rendered the
delay reasonable.

45. Ismail b. Bakar & Ors. v Director of Lands
and Mines, Kedah [2011] 5 MLJ 197 (COA)
• Held:
• A 9 year delay in paying compensation is grossly
unreasonable and contravenes s. 29 of the Act
and Art. 13(1) of the Federal Constitution.
• The purported acquisition was invalid, null and
void.

46. Ultra-vires the Constitution
• S. Kulasingam & Anor. v Comm. Of Land,
Federal Territory & Ors. [1982] 1 MLJ 204
• Issue:
• App.s argued that s.3 of the LAA infringes the
equality provision under s.8(1) of the Fed.
Consti. because it does not provide any
guidelines on policy/ principles as to how the
choice of land for such purposes is made.

47. Held:
• S. 3 says that the State Authority may acquire
‘any land’ which is needed for any ‘public
purpose’.
• It does not provide for the acquisition of any
land for ‘any purposes’.
• The acquisition in this case was therefore not
ultra-vires the FC.

48. ‘Mala fide’ (see discussion in your
textbook)
• Syed Omar Alsagoff’s case
• Yeap Seok Pen v Govt of Kelantan [1986]
• Stamford Holdings S/B v Kerajaan Negeri
Johor [1998] 2 AMR 997
• Ahmad bin Seman’s case.

50. Acquisition of land under
s.3(b) and (c) LAA 1960
• LAA 1960 - amended in 1998 to include
provisions on the administrative framework for
land acquisition where it is done by application
of a person/corporation under para. (b) and/or
(c) of section 3(1).

51. Condition:
• An application for land acquisition under s.3(2)
will not be approved if the applicant had already
obtained ‘development approval’ (i.e. planning
permission from the local planning authority,
etc.) and the project is not for public utility.
• (see s.3(6))

52. How to Apply?
• 1) Application is
made in writing to
the Land
Administrator.
• 2) LA transmits
application to the
State Economic
Planning Unit (State
EPU) or the
• FT Special Committee
for Land Acquisition
for land in FT.
• 3)

54. Requirements (s.3(3)):
• a) project proposal
• b) lay out and land acquisition plan
• c) preliminary Government valuation report
• d) fee and deposit required under the LA Rules

55. How will the State EPU/FT Special
Committee decide?
• See s.3A:
• (a) public interest,
• (b) capacity & capability of applicant to carry out
the project,
• (c) feasibility of the project,
• (d) the development approval granted to the
applicant.

56. Possibility for Land Owner to
Participate in Project
• s.3A(2) allows the State EPU/ FT Committee to
consider the participation of the land owner in the
project where development proposal has been
obtained and the project is for public utility.
• S.3A (3) and (4) allows the applicant to negotiate
terms with the land owner on the type of
arrangement for participation.
• If negotiations are successful, no land acquisition.
• If fails, land acquisition may proceed.
• Application then transmitted to the State Authority
with State EPU/FT Committee recomendations.

57. Special Committee for Land
Acquisition (s. 3C)
• Jawatankuasa Khas Pengambilan Tanah
(‘JKPT’).

58. Magnasari Sdn. Bhd. v Kerajaan N.
Perak & Ors. [2013] 7 MLJ 557

59. Special Committee for Land
Acquisition
• See members of this committee listed in s.3C.
• Application for land acquisition will be
considered by this committee (s.3D)before it is
approved by the State Authority under s.3E.

60. Withdrawal of Application for LA
• An applicant for land acquisition under s.3(2)
may withdraw its application before the
Declaration of Intended Acquisition is gazetted
under s.8 LAA 1960 by giving notice in writing to
the LA.
• Persons interested may be compensated for any
inconvenience caused by the initial application
of the applicant from the deposit put in by the
applicant earlier.