Orchard Circle Sdn Bhd v Pentadbir Tanah Daerah Hulu Langat: Section 8 of the Land Acquisition Act 1960
by Rajasingam Gothandapani, Lynette Tan Hui Ling
Published: January, 2021
Submission: January, 2021
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A case note by Rajasingam Gothandapani and Lynnette Tan Hui Ling.
It is trite that a declaration in Form D under section 8(1) of the Land Acquisition Act 1960 (“LAA”) lapses and becomes ineffective by effluxion of time if no award is made within two years from the date of its publication in the Gazette.
But what if there is an award of the Land Administrator that is made within the stipulated two-year period, but that award is subsequently quashed resulting in a subsequent award that is made outside the two-year period?
The Federal Court had the opportunity to consider this question in Orchard Circle Sdn Bhd v Pentadbir Tanah Daerah Hulu Langat1.
THE LEGAL BACKDROP
The significance of Form D is to be found in section 8(1) of the LAA. When the State Authority decides that a land is to be compulsorily acquired, it shall publish in the Gazette a declaration in Form D.
Section 8(4) of the LAA reads:
“A declaration under subsection (1) shall lapse and cease to be of any effect on the expiry of two years after the date of its publication in the Gazette in so far as it relates to any land or part of any land in respect of which the Land Administrator has not made an award under subsection 14(1) within the said period of two years, and, accordingly, all proceedings already taken or being taken in consequence of such declaration in respect of such land or such part of the land shall terminate and be of no effect.”
Prior to the introduction of section 8(4) of the LAA in 1984 through the Land Acquisition (Amendment) Act 1984 (Act A575), the delay occasioned by the relevant authority in compulsorily acquiring land was dealt with at common law according to the facts and circumstances of each case.
With the introduction of the subsection, Parliament intended to place a definite time limit within which the State Authority must act to effect an acquisition of land. The legislative purpose was to put an end to uncertainty and protracted litigation resulting from long delays between the publication of a declaration in the Gazette and the making of an award of compensation.
Thus, the Court of Appeal in Pengarah Tanah dan Galian Negeri Kedah v Emico Development Sdn Bhd2 had held that a declaration in Form D under section 8(1) of the LAA lapses and becomes ineffective by effluxion of time if no award is made within two years from the date of its publication in the Gazette.
FACTS OF THE CASE
The appellant (“Orchard Circle”) was the registered owner of two parcels of land which were compulsorily acquired by the State Authority. On 10 December 2001, Form D of the LAA was issued to compulsorily acquire the lands for the purpose of building the Kajang Traffic Dispersal Highway (“SILK Highway”).
On 24 December 2002, an inquiry before the Land Administrator was held in respect of the acquisition of the lands. Orchard Circle was awarded a nominal sum of RM1 as award for the compulsory acquisition. Reason being that a portion of the lands had already been surrendered to the State Authority. Form G (“Written Award of Compensation”) and Form H (“Notice of Award and Offer of Compensation”) dated 24 December 2002 were issued in relation to the first land inquiry (“First Award”).
FIRST JUDICIAL REVIEW PROCEEDINGS
On 30 January 2003, Orchard Circle filed an application for judicial review for an order, amongst others, to quash the First Award of compensation and alternatively for a declaration that the acquisition of the lands is null and void (“first judicial review application”). Orchard Circle alleged that it was not given a right to be heard at the first land inquiry.
On 10 December 2010 (after nine years from the date of Form D and seven years from the date of filing of the first judicial review application), the High Court in Shah Alam allowed the first judicial review application and made the following orders:
An inquiry was conducted by the Land Administrator on 17 February 2011 to 17 November 2011 (the “second land inquiry”) pursuant to the order of the High Court dated 10 December 2010.
At the second land inquiry before the Land Administrator, Orchard Circle raised the issue that Form D had lapsed because no award was made within two years from the date of Form D (premised on section 8(4) of the LAA).
On 20 April 2012, the Land Administrator in the second land inquiry proceeded to make the award in the second land inquiry. The Land Administrator’s answer to Orchard Circle’s objection was that the issue in relation to a lapsed Form D did not arise as the award was but an extension of the First Award when the High Court on 10 December 2010 in the first judicial review application ordered for a fresh land inquiry.
Dissatisfied with the decision of the Land Administrator in the second land inquiry, Orchard Circle filed the second judicial review application on 30 May 2012.
DECISION OF THE HIGH COURT
The High Court allowed the second judicial review application and held that the validity of Form D was only for a period of two years from the date of its publication in the Gazette and quashed Form D dated 10 December 2001, Form G and Form H, both dated 20 April 2012 and all proceedings following thereon.
DECISION OF THE COURT OF APPEAL
The Court of Appeal allowed the appeal by the respondents, amongst others, on the grounds that section 8(4) of the LAA was complied with when the First Award was handed down by the Land Administrator on 24 December 2002 which was well within the two-year period from Form D dated 10 December 2001. The purpose intended in section 8(4) of the LAA would be defeated if a strict interpretation was adopted since the Land Administrator has no control over the legal challenges mounted by the litigants.
LEAVE APPLICATION TO THE FEDERAL COURT
Orchard Circle sought leave to appeal to the Federal Court against the Court of Appeal’s judgment. Leave was granted on two issues, but this article only considers one. That question is:
“Whether, pursuant to section 8 (4) of the Land Acquisition Act 1960, a declaration in Form D lapses and ceases to be of any effect where an award of the Land Administrator is made within the stipulated two years period but subsequently quashed resulting in a subsequent award made outside the two year period.”
DECISION OF THE FEDERAL COURT
The Federal Court upheld the judgment of the Court of Appeal. The Federal Court observed that the Court of Appeal’s approach was correct and did not warrant any appellate intervention. The Federal Court held conclusively that the Form D in the present case had not lapsed and neither did the order of the High Court on 10 December 2010 quash the said Form D.
The Federal Court opined further that the first land inquiry was within the two-year period from the date stated in Form D. Therefore, Form D was very much valid even until the second land inquiry. Accordingly, the Federal Court declined to answer the postulated question contending that the way it was framed did not reflect or arise from the facts of the present case and neither did it come from the decision of the High Court dated 10 December 2010.
The Federal Court, in arriving at its decision, was of the view that it cannot be said that the Land Administrator in the second land inquiry had contravened section 8(4) of the LAA when it made the second award beyond the two-year period as the second land inquiry was only to substitute the first land inquiry. The issue of the land acquisition and taking possession of the lands and Form D were never declared as null and void by the Court.
The Court further noted that the purpose was to ensure that land proprietors whose lands were compulsorily acquired for public purpose were compensated speedily and that the insertion of section 8(4) of the LAA was in line with the decision of the Federal Court in Pemungut Hasil Tanah Daerah Barat Daya (Balik Pulau), Pulau Pinang v Ong Gaik Kee5.
The Federal Court was persuaded by the fact that not only had the lands already been formally taken possession of by the State Authority when Form K was issued on 20 February 2003 in accordance with section 22 of the LAA, those lands had also vested in the State Authority. There was no provision in the LAA to revert the land to the landowner.
The Federal Court adopted the interpretation by the Supreme Court of India on section 11A of the Indian Land Acquisition Act in two of its cases, namely
Consequently, the Federal Court ruled that section 8(4) of the LAA did not apply when the acquisition proceedings were completed, and the lands were already vested in the State Authority. Instead, it applies to cases where proceedings are taken or being taken within the period of two years if the land acquisition has not been completed.
The Federal Court opined that it would be absurd to claim that the lands had reverted to Orchard Circle in the circumstances because the first judicial review application was decided only after seven years after it was filed. By then the SILK Highway project had been completed. Thus, it cannot be the case that Orchard Circle was still the owner of the land where the highway had been constructed.
The Federal Court was of the view that the determination of the appeal hinged on the interpretation of section 8(4) of LAA. It rejected the argument that section 8(4) ought to be given its literal and natural meaning because, firstly, it ignored the reason as to why the second land inquiry was made beyond the two-year period and, secondly, because a literal and ordinary interpretation of section 8(4) of the LAA in the context of the present case would lead to absurdity. In the upshot, the Federal Court gave deference to the purposive approach of interpretation of the section in line with section 17A of the Interpretation Acts 1948 and 1967.
For further information regarding dispute resolution matters, please contact our Dispute Resolution Practice Group.
1.  1 LNS 1553.
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