Dr Ti

- vs -

The Registrar of Titles

Judgment

Hashim Yeop A Sani J

1. In this Originating motion the applicants are asking for a number of orders the most important among which is an order to set aside the decision of the Registrar of Titles, Selangor, dated 21 February 1981 refusing to accept for registration the memorandum of transfer and a charge in respect of property of the first applicant held under HS(D) 8502 PT No 1 Jalan 14/48 in the Mukim of Petaling Jaya. The applicants also seek for a declaration that the restriction in interest endorsed on the document of title of the said property expired on 17 August 1979.

2. From the affidavit of the lawful attorney of the first applicant, sworn on 10 June 1981, the following facts are disclosed. The first applicant is and was at all material times admittedly the registered proprietor of the property in question. By a sale and purchase agreement dated 25 March 1980 he agreed to sell and the second and third applicants agreed to purchase the property subject to the terms and conditions set out therein. A memorandum of transfer dated 5 May 1980 was duly executed and the second and third applicants also executed a charge in favour of the fourth applicant, a finance company.

3. To digress a little here, the said affidavit also exhibited copy of the title of the said property — “MSY 2”. It can be seen that page 1 of the title carries the following endorsement — 

   Restriction in interest The land hereby leased shall not be transferred or leased for a period of 15 years without the consent of the Ruler in Council.

   At page 2 of the title the following particulars also appear —

   (1)	Tarikh mula-mula diberi milik — 18 August 1964
   (2)	No hakmilik asal (tetap atau sementara) QT(R) 2742.

4. The said memorandum of transfer and charge were thereafter presented for registration to the respondent and these documents were in fact registered but subsequently, however, the registration was cancelled. In his letter dated 21 February 1981 the respondent wrote to the solicitors of the applicants to the effect that the application for registration was rejected on the grounds that the restriction in interest on the said property was according to the respondent still in force. The respondent was of the opinion that the restriction in interest commenced on 9 November 1967 and the 15 years period will expire only on 8 November 1982 — see affidavit of respondent dated 5 September 1981. It is obvious that the respondent relied on the calculation that the period of 15 years commenced on 9 November 1967, being the date which the alienation of the said land was registered after full payment of premium and other fees was made.

5. It can be seen clearly that the central and only issue in this case is on what date the restriction in interest commenced. The applicant relies on the particulars appearing on page 2 of the title which states that the application was given the title on 18 August 1964 and if the restriction in interest commenced on that date it therefore expired on 17 August 1979. Based on this calculation therefore the respondent would be wrong in rejecting the application for registration.

6. The respondent, on the other hand, relies on s 78(3) of the National Land Code which states that the alienation of State land shall take effect upon registration and the date of registration being 9 November 1967 the period of 15 years has not ended.

7. It is not disputed that the proper registering authority under the Land Code has the right to reject any instrument on the ground that it is unfit for registration. Counsel for applicant argued that for purposes of calculating the period for the operation of the restriction in interest in this case the question of registration is irrelevant. With respect I totally disagree. Registration is central in the Torrens system and in any statute like the National Land Code which carries the Torrens system. As Edwards J said in delivering the judgment of the Court of Appeal in Fels v Knowles (1906) 26 NZLR 604:

   The cardinal principle of the statute is that the register is everything ....

8. It is registration that gives and extinguishes title under the National Land Code. Registration is the cornerstone of the Torrens system.

9. According to s 105 of the National Land Code, restriction in interest starts to run from the date of alienation. Section 105(1) reads as follows:

   Every condition or restriction in interest imposed by or under this Act shall, except where it is otherwise provided by this Act or the context requires, commence to run from the date of alienation of the land to which it relates.

10. In my opinion the word “alienation” is crucial for the proper interpretation of s 105. Section 78(3) of the Code determines when an alienation of State land shall take effect and it is clear from that subsection that alienation takes effect upon registration.

11. Section 78(3) of the Code reads as follows:

    The alienation of State land shall take effect upon the registration of a register document of title thereto pursuant to the provisions referred to sub-s (1) or (2), as the case may be; and, notwithstanding that its alienation has been approved by the State Authority, the land shall remain State land until that time.

12. It is to be observed in the second limb of that subsection until the date of registration the land shall remain State land.

13. The importance of registration is again and again emphasised in the Code. Thus in the definition of “restriction in interest” in s 5 of the Code the expression is defined to mean any limitation imposed by the State authority or any conditions imposed on a proprietor in Pt 9 and Div IV of the Code. The definition of “proprietor” in the same section of the Code describes a proprietor to mean any person or body for the time being registered as proprietor of any alienated land.

14. Thus it is clear in law that for the purposes of the National Land Code the first applicant was never the “proprietor” of the said property prior to the date of registration. There can be no question therefore of any property in the said land being vested in the first applicant prior to the date of registration although the said land was approved for alienation as stated in the letter of the Assistant Collector of Land Revenue, Petaling Jaya, addressed to the first applicant informing him of the approval for alienation and setting out the fees to be paid and setting out also the express conditions and the restrictions in interest. For the same line of argument please see also the judgment of Thomson CJ (as he then was) in Malayan Borneo Building Society Ltd v M Ramachandran [1959] MLJ 182

15. Looking at the second limb of s 78(3) of the Code it seems clear to me that the restriction in interest could not have commenced before the date of registration because the land remained State land and the restriction could not have meant to operate on the State authority.

16. Counsel for the applicant argued also that if we construe the date of commencement of the restriction in interest to be later than the date that the first applicant paid the fees due upon the approval for alienation which is incidentally also the date endorsed on page 2 of the title which is 18 August 1964, then the first applicant would in theory be free to deal with the said property before the date of registration and therefore would be contrary to the very object of the restriction in interest. I think this line of argument is purely hypothetical and does not arise at all in this case. Furthermore it is to be observed that when the first applicant was informed that his application for land was approved the same letter which conveyed the approval also conveyed the express conditions and the restriction in interest imposed on the land.

17. It would seem clear that as a result of the endorsement at page 2 of the title there was a mistake on the part of the applicants as to the expiry date of the restriction in interest on the land. But as Salmond J said in Boyd v Mayor etc. of Wellington [1924] NZLR 505:—

    I can see no difference in this respect between an instrument which is void because ‘unknown to the parties’ it is a forgery and one which is void executed by an infant or by an attorney without authority or by mistake or ultra vires.

18. My conclusions are therefore as follows:—

    1. Since registration is the cornerstone of the Torrens system the restriction in interest on the land in question commenced from the date of the registration of the register document of title i.e. 9 November 1967 and will cease to operate only after 15 years from that date;

    2. Section 105(1) of the National Land Code (providing for the commencement of a restriction in interest) must be read together with s 78(3) of the Code (providing how alienation is effected) to give a proper interpretation as to when the period of restriction in interest begins to run;

    3. In determining the period during which the restriction in interest is in force according to law, the endorsement purporting to show the date on which title of the said land was granted (18 August 1964) appearing at page 2 of copy of title being an administrative act should be ignored.

19. Application is dismissed with costs.

Cases

Fels v Knowles (1906) 26 NZLR 604; Malayan Borneo Building Society Ltd v M Ramachandran [1959] MLJ 182; Boyd v Mayor etc of Wellington [1924] NZLR 505

Representations

C.T. Khaw for the applicants.

Abdul Malik Salleh, Legal Adviser, Selangor for the respondent.