Malaysian Land Law and the National Land Code
Scope and the Torrens system
The National Land Code 1965 (Act 828) applies to Peninsular Malaysia only; Sabah and Sarawak have their own land legislation. Malaysia follows the Torrens system: the register is everything, title passes by registration, not by contract or payment. A sale and purchase agreement gives the purchaser a contractual and caveatable interest, not ownership.
Indefeasibility and its exceptions
Section 340 confers indefeasibility on a registered titleholder, subject to exceptions including fraud, misrepresentation, forgery, registration of a void instrument, and title obtained by an insufficient or void authority. Candidates should be able to name those exceptions.
Dealings
Transfers, charges, easements and leases are effected by prescribed statutory forms, executed, presented with the issue document of title, and registered at the land office. Priority follows the order of presentation and registration. A lease exceeding three years must be registered; a tenancy not exceeding three years is exempt from registration under section 213(3).
Controls and caveats
Each title carries a category of land use (agriculture, building, industry), express conditions and, often, a restriction in interest. Dealings that breach these require State Authority consent, failing which registration may be refused or set aside. A private caveat lodged under section 323 protects an unregistered interest, such as a purchaser's.
Traps
- Thinking the buyer owns the property on signing the SPA or paying the price.
- Confusing a tenancy (three years or less, unregistered) with a lease (over three years, registrable).
- Ignoring restriction in interest and category of land use, and the consent requirement.
- Assuming a caveat gives title; it only protects and gives notice.
Rule of thumb
Ask of every dealing: is it in the right form, properly executed, consented where necessary, presented and registered? If any step is missing, the interest is incomplete.