Federal Court Deals with Property Scam

Lady Justice depicts justice as equipped with three symbols: a sword symbolizing the court's coercive power; a human scale weighing competing claims in each hand; and a blindfold indicating impartiality.

I have almost lost faith in the Malaysian Judiciary System. This did not happen recently. It was built up over the years. However, the landmark ruling by the Federal Court on 21 January 2010 made me rethink the direction our Judiciary System is heading. This ruling will put a stop to illegal property transfers in the country. There may yet be hope.

Previously, the Federal Court had ruled that owner whose property was transferred via fraudulent means could not take legal action against the third party who bought the property from the fraudster. Unscrupulous people will falsify tittles transfer and documents to themselves and then sell the properties. Once the property is sold, the law could not protect the rightful owner as long as it can be proven that the third party buyer bought the property on good faith. This resulted in property fraud victims being unable to recover their property. Since the ruling about 10 years ago, fraudulent transfer has become a thriving business for some. After a decade, this has finally been corrected.

The landmark ruling on 21^st Jan 2010 meant that if it can be proven that a title has been obtained by forgery or misrepresentation, then the claim can be defeated. This will help curb forgery incidents and property scams and protect owners from losing their property. In this rare joint effort by the entire legal fraternity including the 4 highest ranking judges, it is no longer legal for anyone to buy a piece of property from someone who got hold of the property through fraudulent means.

This will also give us assurance that our property will not be easily stolen and we can take legal action if it happens. I think it will also increase investors’ confidence in Malaysia.

This is just a dose of Justice served. Many, many, many more doses are required. We are still far away from an effective and efficient Judiciary System. The beginning of a long journey, maybe.

Boonsom Boonyanit has purchased an 8,000 sq m plot of land in northern Penang in 1967. In 1989 she found out that her land was sold to Adorna Properties Sdn Bhd by someone. An imposter has forged documents to obtain her land title and sold it.

Boonsom initially sued Adorna for the return of her land but lost as the High Court decided that Adorna had purchased the property in good faith. To her joy, in 1997 the Court of Appeal overturned the High Court's decision.

However in 2000, Adorna appealed to the Federal Court, which ruled it favour of Adorna because it had obtained an indefeasible title to the land even though the land title was forged. This ruling came after Boonsom's death. So she passed away believing that she has won the case.

Then in 2010, a dose of Justice was served where five Federal Court judges overturned the erroneous precedent in Boonsom's case. The judgment in Tan Ying Hong v Tan Sian San case declared that a registered owner’s claim to a land title can later be defeated if it can be shown that the title was obtained by forgery, closing the loophole in the law.

To this day, the third generation of Boonsom Boonyanit’s family is still fighting her case. Her grandsons Piya and Prithep Sosothikul are pursuing Boonsom case so that others will not suffer their grandmother’s fate.

Case References:

Tan Yin Hong vs Tan Sian San

Adorna Properties Sdn Bhd vs Boonsom Boonyanit

• Federal Court overturns 'blatant error'

  PUTRAJAYA: The Federal Court this morning overturned a highly criticised judgment said to have wreaked havoc in land transactions for the past nine years

• A 10-year legal wrong finally righted Business Times Singapore

  Ten years ago, Malaysias apex court made a decision that many considered bizarre and introduced much uncertainty into investors decisions.

• 8 Feb 2010 : Adorna overturned a beginning, not the end

  Euphoria over the Federal Courts decision to consign Adorna to the judicial dustbin should not obscure the fact that more needs to be done to resolve several related issues.