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Case Update: Assessors' Opinions in Land Acquisition Cases - Not Just for Courts' Eyes!

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15 March 2024

LAND LAW
Land Acquisition – Assessors – Adequate Compensation – Deprivation of Property

Tegas Sejati Sdn Bhd v Land Administrator Hulu Langat & Anor
Civil Appeal No. 01(f)-46-11/2022(B) | Federal Court
- see the grounds of judgment here

Facts Tegas Sejati Sdn Bhd (the “Appellant”) entered into a joint-venture agreement with Perbadanan Setiausaha Kerajaan Selangor (PSKS) to develop several lots of land in Selangor. Some of the land involved was then acquired by the State Government for a highway project, with Lembaga Lebuhraya Malaysia (LLM) as the paymaster. Arguments later arose over the assessment of compensation for the acquisition, including the date of valuation, whether it should be by reference to the first date of acquisition in 2015 or the later date in 2016; and whether development costs are compensable. The Land Administrator Hulu Langat (the “1st Respondent”) handed down an award for compensation to which both LLM and the Appellant, objected. Both LLM and the appellant filed their respective objections vide Form N and this led to two land reference proceedings before the High Court. Both land reference proceedings were rightly consolidated and heard together. Assessors were appointed to sit in the reference proceedings at the High Court and to give their opinion on the compensation pursuant to section 40C of the Land Acquisition Act 1960. However, the opinion was not made available to the parties. Subsequently, the Appellant filed an application seeking to strike out the 1st respondent’s land reference proceedings. The High Court dismissed the striking out application, dismissed the Appellant’s land reference and allowed LLM’s land reference. The Appellant appealed against both decisions while LLM cross-appealed, seeking to vary part of the High Court’s decision and a return or repayment of an excess sum. The Court of Appeal dismissed the appellant’s appeals, allowed LLM’s cross-appeal and directed a refund of the excess sum together with interest. The Appellants then filed this appeal to the Federal Court.

Issue 1. Whether there was a failure to comply with section 40C of the Land Acquisition Act 1960

Held In allowing the appeal, the Federal Court held that there was non-compliance with section 40C of the Land Acquisition Act 1960 as the written opinions of the assessors were not made available to the parties. The Federal Court emphasized the importance of transparency and fairness in legal proceedings, particularly in land reference proceedings, which are conducted in open court. It stressed that all relevant material, including the written opinions of assessors, must be made available to the parties involved to ensure that their rights are properly addressed. The Federal Court highlighted that failure to provide written opinions to the parties could compromise the adequacy of compensation and contravene the rights enshrined in Article 13 of the Federal Constitution, particularly regarding the deprivation of property without adequate compensation. As a result, the appeal was allowed, and the orders of the lower courts were set aside. The matter was remitted to the High Court for a rehearing before another judge.

Zul Rafique & Partners
{15 March 2024}

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