In this two part series, Liew Siew Pen explains the legal framework and procedures governing compulsory land acquisition
The law of land acquisition is principally concerned with the rules governing the procedures to be followed in acquiring the land by compulsory means and with the awarding of compensation to the dispossessed landowner.
The rights of a property owner in Malaysia are governed by the following legislations:-
1) The Federal Constitution;
2) The National Land Code 1965 /Land Ordinance (Sabah Cap 68) 1950/Sarawak Land Code (Cap.81) 1958;
3) The Land Acquisition Act 1960/Land Acquisition Ordinance (Sabah Cap. 69) 1950/Part IV of the Sarawak Land Code (Cap.81) 1958.
Under Article 13 of the Federal Constitution, the nature and extent of property rights of a person are as follows:
(1) No person shall be deprived of property save in accordance with law.
(2) No law shall provide for compulsory acquisition or use of property without adequate compensation.
The above provisions ensure that a person is not deprived of his property without adequate compensation being made.
The Land Acquisition Act 1960 (“LAA”)
LAA came into force on 13 October 1960 and can be divided into two main parts:
(i) The procedural requirements for the acquisition of land; and
(ii) Reference to Court if there are any objections or disputes arising from the acquisition of land.
Section 3 (1) of LAA provides the purpose of land acquisition which states as follows:-
(1) The State Authority may acquire any land which is needed-
(a) for any public purpose;
(b) by any person or corporation for any purpose which in the opinion of the State Authority is beneficial to the economic development of Malaysia or any part thereof or to the public generally or any class of the public; or
(c) for the purpose of mining or for residential, agriculture, commercial, industrial or recreational purposes or any combination of such purposes.
An application for acquisition of land under Section 3(1) (b) or (c) of LAA shall be made in Form 1 as provided in First Schedule of the Land Acquisition Rules 1998.
It is evident that the discretion to determine the acquisition for purposes under Section 3, especially Section 3(1)(b) is given to the State Authority. However, the procedural guidelines to be followed by the State Authority in exercising their discretion as referred above are not specifically provided for in LAA.
In Pengarah Tanah dan Galian, Wilayah Persekutuan v Sri Lempah Enterprise Sdn Bhd  1 MLJ 135, His Honour, Suffian LP held in relation to whatever powers were given to the authorities, these powers had to be exercised fairly and reasonably. The authorities were not at liberty to use their powers for an ulterior object, however much that object may seem to them to be in the public interest.
The Procedural Requirements
The land acquisition process involves a uniform procedure and the submission of essential forms, and these are summarised in the table below:
|Step||Purposes||Forms||Provisions in LAA|
|1||Whenever the State Authority is satisfied that any land in any locality in the State is likely to be needed for any of the purposes referred to in Section 3.||A notification in Form A shall be published in the Gazette||S4|
|2||The State Director may by written authority generally or specifically authorize any officer or person, together with servants and workmen, to enter upon any land in any locality specified in a notification published under s4, and to do such work as may be specified in such Form .||Form B||S5|
|3||The Land Administrator shall then prepare and submit to the State Authority a plan of the whole area of such lands, showing the particular lands, or parts thereof, which it will be necessary to acquire and a list of such lands in Form C.||
|4||When the State Authority decides that any of the lands referred to in Section 7 are needed for any of the purposes referred to in Section 3, a declaration in Form D shall be published in Gazette||
|5||The Land Administrator shall having completed the action required in Section 9, commence proceedings for the acquisition of the land by giving pubic notice in Form E in the manner prescribed by Section 52 and by fixing the date of an inquiry for the hearing of claims to compensation for all interest in such land.||Form E||S10|
|6||The Land Administrator, in any particular case may also by service of a notice in Form F, require the registered proprietor of any land, specified in any notice in Form E, or any other person who may in the opinion of the Land Administrator have knowledge of the fact referred to therein, within such period as may be prescribed in such notice to furnish a statement in writing of the information required by such Form.||Form F||S11|
|7||On the date appointed under Section 10, the Land Administrator shall make full enquiry into the value of all the scheduled lands and shall as soon as possible thereafter assess the amount of compensation which in his opinion is appropriate in each case, according to the consideration set out in First Schedule of LAA.||S12|
|8||Upon the conclusion of the enquiry under Section 12 relating to any scheduled land, the Land Administrator shall prepare a written award under his hand in Form G.||Form G||S14|
|9||On making any award under section 14(1) in respect of any scheduled land, the Land Administrator shall prepare and serve on each person interested in such land a notice in Form H||Form H||S16|
|10||Where any land, described in any notice in Form E given under section 10, is in the opinion of the State Authority urgently required for use for a public purpose, or for a public utility in the case of an acquisition under paragraph 3(1)(b), the State Director may, on or after the expiration of fifteen days from the date of giving such notice, issue a Certificate of Urgency directing the Land Administrator to take possession of such land, subject to section 20.||Form I||S19|
|11||Where on any scheduled land in respect of which a Certificate of Urgency has been issued there is any building the Land Administrator shall, upon taking formal possession as provided in Section 22 of the land not built upon, other than the main access to the building, serve notices in Form J||Form J||S20|
|12||The Land Administrator shall take formal possession of any scheduled land by serving upon the occupier thereof or, if he cannot be found, by posting thereon, a notice in Form K||Form K||S22|
|13||Where the issue document of title to any scheduled land has not previously been delivered to him, the Land Administrator shall, by a notice in writing in Form L require any person in whose possession such document may be, to deliver such document to the Land Administrator; and upon service of such notice upon him such person shall be legally bound to deliver such document to the Land Administrator.||Form L||S24|
|14||The Land Administrator may, at any time of his own motion by application in Form M refer to Court for its determination any question as to referred in Section 36(2)(a)-(f).||Form M||S36|
|15||Any objection made under Section 37 shall be made by a written application in Form N to the Land Administrator requiring that he refer the matter to the Court for its determination, and a copy thereof shall be forwarded by the Land Administrator to the Registrar of the Court||Form N||S38(1)|
|16||Once receiving any application under Form N, the Land Administrator shall, subject to Section 39, within six months refers the matter to the court by a reference in Form O||Form O||S38 (5)|
|17||On receiving a reference from the land administrator pursuant to Section 38(5), the Court shall cause a notice in Form P, specifying the day on which the Court will proceed to hear and determine the objection contained in such reference, to be served on the following persons, and directing their appearance before the Court at the hearing.||Form P||S43|
|18||On receiving any direction under Section 57 (Temporary Occupation or use of land), the Land Administrator shall give notice in writing in Form Q to the persons interested in such land of the purpose for which the land is needed, and shall make such offer to compensation, or shall negotiate the payment of such compensation, as shall be reasonable in all the circumstances of the case.||Form Q||S58|
As can be seen, Land acquisition is a complex and time-consuming process in which the land owners should have adequate knowledge in order to protect their rights.
Liew Siew Pen – firstname.lastname@example.org
Christina Chia – email@example.com
CCLC Corporate and Commercial ( Real Estate) practice area has vast experience in advising on real estate transactions, housing development projects and tenancies.