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10PLANNING & THE LAW“The appellants in this appeal contended that theproceedings were null and void as they say their landswere acquired for purposes other than those for which therespondent was empowered under the Act to acquirethem…The Act imposes no obligation on the acquiring authorityto produce a plan for inspection which shows how theland to be acquired is to be zoned…Section 8(3) … provides that the Declaration shall beconclusive evidence that all the scheduled land isneeded for the purpose specified therein. While it may bepossible to treat a Declaration made . . . as a nullity if itbe shown that the acquiring authority has misconstruedits statutory powers . . . or that the purpose stated in theDeclaration does not come within section 3, in theabsence of bad faith, which in the instant case isnegatived by concurrent findings of fact in the courtsbelow, this sub-section renders it not possible tochallenge the validity by asserting that some of the landto which it relates is not needed by the purposes statedor that the land is in fact wanted for purposes other thanthose specified. Consequently, the fact that the landslisted in the Schedule amounted to some 5,700 acreswhen the total area of the State Development Officer’soriginal requirement was 2,000 acres does not help theappellants, nor can it really be contended that thepurposes stated in the Declaration do not come withinsection 3.” (Emphasis added)Although the Privy Council dismissed the landowner’schallenge, it did acknowledge that an acquisitionproceeding can be successfully challenged if mala fide(bad faith) can be proved.Syed Omar’s case once again reiterated the principle,established earlier in Yeap Seok Pen v. Government ofKelantan 14 that mere suspicion is not enough. In that case,which came from Kelantan, Lord Griffiths held that “badfaith is an exceedingly serious allegation to make and shewho makes it has a heavy burden to discharge the onus ofproving it”.It is indeed regrettable that in Syed Omar’s case, the PrivyCouncil did not (failed to) refer to its own earlier decision inMunicipal Council of Sydney v. Campbell & Ors 15 . In thatearlier case from Australia, the appellants wereempowered by law to acquire land for making or extendingstreets as well as for carrying out “improvements in orremodeling any portion of the city”. They had acquired therespondents’ land to extend Martin Place, an importantthoroughfare in the centre of Sydney. The respondentschallenged the acquisition. In the course of the trial, therespondents admitted that “no plan of improvement orremodeling was at any time before the Council…”In its judgment in favour of the respondents, the PrivyCouncil noted -“No plan for improvement or remodeling was at any timedecided upon; and, indeed, no such plan was everconsidered by or proposed by the Council …Their Lordships think it not reasonably disputed that atthe time of the passing of the resolution in June, theCouncil conceived it to be within its powers to resumelands not needed for the extension itself, but solely forthe purpose of appropriating the betterments arising fromthe extension…A body such as the Municipal Council of Sydney,authorized to take land compulsorily for specifiedpurposes, will not be permitted to exercise its powers fordifferent purposes, and if it attempts to do so, the Courtswill interfere”.The Privy Council, however, remarked that “Where theproceedings of the Council are attacked upon this ground,the party impeaching these proceedings must, of course,prove that the Council, though professing to exercise itspowers for the statutory purpose, is in fact employing themin furtherance of some ulterior object”.Looking back on Syed Omar and the Sydney case, bothdecisions of the Privy Council which are binding onMalaysian courts, the law can be summarized as follows -(1) A compulsory acquisition proceeding can bechallenged on the grounds of mala fide, providedthere are cogent evidence to prove it. The onus ofproof is on the party alleging mala fide.(2) The absence of any plan for the acquired land is anindication of bad faith, although whether it issufficient to convince the court is a separate matter.(3) If the acquiring authority did actually acquire the landfor some other (or improper) purpose, “the Court willinterfere”.Unconscionable or unmeritorious conductIn the recent case of Stamford Holdings Sdn Bhd v.Kerajaan Negeri Johor & Ors 17 , the appellants’ land,measuring 6,600 acres were compulsorily acquired by theGovernment of Johor The appellants challenged theacquisition, claiming it as an unconstitutional means ofdepriving them of their property. They also alleged that theacquisition was outside the ambit of section 3 of the LandAcquisition Act 1960.The facts of the case, as alleged by the appellants, showedthat various people in high places as well as politicallyconnectedpersonalities were somehow involved. Theappellants’ statement of claim was, however, struck out bythe High Court on the ground that there was no cause ofaction. Against that decision, the appellants appealed tothe Court of Appeal.14[1986] 1 MLJ 44915[1925] AC 338.16[1925] AC 338, at p. 343.17[1998] 1 MLJ 607.BERITA PERANCANG
PLANNING & THE LAW 11What is peculiar about this case is that the respondentsfailed to file their defence to the appellants’ statement ofclaim. It was argued on behalf of the respondents that thedeclaration under section 14 of the 1960 Act cannot bechallenged in any way. Section 14 states that “Every award… shall be final and conclusive evidence of the area of anyscheduled land, of its value … and of the apportionment ofthe compensation awarded …”In its decision allowing the landowners’ appeal, the Courtof Appeal cited with approval the Privy Council decision inSyed Omar that it is still possible to challenge anacquisition if it can be shown that the acquiring authorityhad “misconstrued its powers” or that it had acted in “badfaith”.The Court of Appeal accordingly held that “On the strengthof these authorities and in the light of the allegations in thestatement of claim, we have no alternative except to agreewith the learned appellants’ contention that, in thecircumstances of this case, the acquisition proceedingsmay be challenged on the ground of mala fide or bad faith.”The Court of Appeal also observed that the acquisitionproceedings in this case “had deprived the appellant of itslegitimate expectation of profit from the development of theaforesaid 6,600 acres of land. These proceedings had infact deprived the appellant of its property which could havebeen at least sold with a profit if the property had not beenacquired - even assuming that the first respondent wouldnever have approved their application for development”.In the concluding part of its judgment, the Court of Appealsaid that -“The facts as stated in the statement of claim … clearlyshow the unconscionable or unmeritorious conduct ofthe respondents. At least those facts are, in the absenceof any defence filed, assumed true, stand unrebuttedand would constitute a good cause of action against therespondents. As such, the respondents’ applicationshould not have been granted by the High Court.”Pursuant to the judgment of the Court of Appeal, the casemust go to full trial on the merits of the appellants’ claim.However, it later transpired that the two parties had agreedto an amicable settlement of RM405 million, which wasduly recorded as a consent Judgment in chambers byZainun J.The lesson we learn from Stamford’s case is that if there isevidence to back up the challenge, a landowner can raiseunconscionable or unmeritorious conduct of the part of theacquiring authority as one of the grounds for rendering theacquisition null and void.SummaryBased on existing case-law, some of which had beenhighlighted above, a landowner wishing to challenge thevalidity of an acquisition proceeding on the grounds ofinordinate delay or mala fide can cite the following –A. Principles derived from Ong Gaik Khee:(i) inordinate delay, if proved, will make the acquisitionillegal, grossly unreasonable;(ii) inordinate delay, if proved to have caused “diminution ofinterests”, will amount to “an abuse of power” and aground for certiorari;(iii)inordinate delay, if proved to have caused thecompensation to become “inadequate”, will bring theinquiry and the award outside the scope of the law;(iv)inordinate delay is “an abuse of power”, rendering theacquisition proceedings “null and void”;B. Principles derived from Kam Gin Paik:(i) inordinate delay had “contravened statutoryrequirements”, making the acquisition not a “validexercise of power”;(ii) if the acquisition is not a valid exercise of power, novalid award had been made; if no valid award had beenmade, no possession can be made; state must “restorepossession”;C. Principles derived from Syed Omar:(i) mala fide, if it can be proved, will render the acquisitionnull and void;(ii) mala fide is difficult (but not impossible) to prove, andonus of proof is on the party who alleges;D. Principles derived from Municipal Council of Sydney:(i) the absence of any plan to carry out stated purpose ofacquisition is evidence of mala fide;(ii) if land acquired was used for a different (improper)purpose, that is evidence of mala fide.E. Principles derived from Stamford Holding:(i) it is possible to challenge an acquisition proceeding if itcan be shown that the acquiring authority had“misconstrued its powers” or that it had acted in “badfaith”;(ii) any unconscionable or unmeritorious conduct on thepart of the acquiring authority, if proven, is evidence ofmala fide.When challenging an acquisition proceeding, landownersusually apply for certiorari. If the challenge is successful,certiorari will be issued by the court to quash theacquisition. Such initial setbacks do not, however, meanthat the State Authority cannot embark on a freshacquisition exercise - except that by this time, the marketprice of the acquired land will be much higher, due to thepassage of time.Apart from certiorari, deprived landowners also apply for adeclaration. In Kam Gin Paik above, the court explainedthat under the Government Proceedings Ordinance, anorder cannot be made against the State Authority torestore possession to the landowners. In such a case, theappropriate remedy is declaration.BERITA PERANCANG
Page 1 and 2: November 2005Beritawww.mip.org.myAs
Page 4 and 5: 4BLOG PERANCANGAN (PLANNING BLOGS)
Page 6 and 7: 6MIP EXCELLENCE AWARDSMIP EXCELLENC
Page 8 and 9: 8PLANNING & THE LAWDELAY AND MALAFI
Page 12 and 13: 12FEATUREViewpoint, New Straits Tim
Page 14 and 15: 14BALANCING ECOLOGY & DEVELOPMENTen
Page 16 and 17: 16CALENDAR OF EVENTSJUNE 20053 Majl
Page 18 and 19: 18ROUND-UPUNITED NATIONS HUMANDEVEL
Page 20 and 21: 20ROUND-UPTHE S-DEV GENEVA 05 - INT
Page 22 and 23: 22MIP COMMITTEESChairman :Md Nazri
Page 24 and 25: 24CAMPUS NEWS - UiTMDEPARTMENT OF T
Page 26 and 27: 26NEWS FROM NORTHERN BRANCH & SARAW
Page 28: 28 PROFILEDATO’ MOHD. FADZIL BINH

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