[LR. 15-18-2010-III]

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M A L A Y S I A

IN THE HIGH COURT IN SABAH AND SARAWAK

AT KUCHING

LAND REFERENCE NO. 15-18-2008-III

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BETWEEN

LEONG CHIN MIN …. OBJECTOR

AND

SUPERINTENDENT OF LANDS &

SURVEYS, KUCHING DIVISION …. RESPONDENT 10

JUDGMENT

This is a Land Reference proceeding under section 56 of the Sarawak Land

Code. The objector, Leong Chin Min was the whole share owner of the 15

subject land which is known as Lot 2239 Block 17 Salak Land District. It is

1.967 hectare mixed zone land. It was acquired for the purpose of

construction of a road. The land was placed under section 48 declaration on

30th October 2003. Pursuant to the inquiry under section 51 of the Sarawak

Land Code, the Superintendent awarded compensation of RM141,200 or 20

RM10.35 per square metre (psm). The objector accepted the award under

protest and hence this inquiry.

Evidence of Objector

Two witnesses testified for the objector; i.e. the objector himself and his

valuer. The objector testified that he bought the subject land in March of 25

2002 for the sum of RM260,000 which works out to RM132,180.00 per

hectare. The government acquired 1.3643 sq. metres of his land which he

said was below the market price. He was told by his valuer that he had

purchased the land below the market price which was around RM205,000.

During cross-examination he was challenged whether he actually purchased 30

[LR. 15-18-2010-III]

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the subject land at RM260,000. The objector offered to produce the sale and

purchase agreement but the offer was not taken up by the counsel for

respondent.

Evidence of valuers

The objector and respondent produced their respective valuation reports and 5

their makers. The objector’s valuer used the comparison method. She

analysed six comparable sales in the area of the subject land. She

determined that sale 1 (RM18.5 psm), sale 5 (RM20.5 psm) and sale 6

(RM18.5 psm) are closest to the subject land and therefore the most suitable

comparable. She also opined that the purchase of price of the subject land at 10

RM260,000 was below market price. After having made minor adjustments

to the value of the comparable sales ranging from 2.5% to 10% in respect of

date of sale, location, size, balance of leasehold term against the subject land,

she calculated the market value of the subject land at RM20.5 psm.

Surprisingly, the government valuer used four comparable sales which were 15

transacted at almost half the market value of the comparable sales used by

the objector's valuer. It is apparent that there have been numerous

transactions in the vicinity of the subject land and the valuers had no trouble

in choosing comparable sales of high price or low price as the basis of their

analysis. The government valuer’s four comparable sales ranged between 20

RM4.37 psm (sale 2) to RM13.22 psm (sale 1). The other sales are RM5.91

psm (sale 3) and RM11.12 psm (sale 4). Incidentally, sale 1 which was used

by the government valuer is the subject land and the transaction in question

is the purchase of the land by the objector in March of 2002. After making

adjustments for location, accessibility, size, shape, term, betterment, time 25

factor, partial transaction against the subject land (sale 1), she concluded that

the market value of the subject land is RM10.35 psm which roughly matches

the award of the Superintendent. Compared to the objector's valuer, the

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government valuer made whopping adjustments which ranged from 1% to -

40%.

Issues

I do not propose to discuss the familiar authorities on the market value and

the approach to be taken in assessing compensation. These are laid out in 5

sections 60 and 61 of the Sarawak Land Code and the cases of Nanyang

Manufacturing Co v Collector Of Land Revenue, Johore [1954] MLJ 69,

Pentadbir Tanah Daerah Petaling v Glenmarie Estate Ltd [1992] 1 MLJ

331, Ng Mui Mui v Indian Overseas Bank [1986] 1 MLJ 203, Collector Of

Land Reveue, Kuantan v Noor Chahaya Binte Abdul Majid [1979] 1 MLJ 10

180 and Chuah Say Hai & Ors v Collector Of Land Revenue, Kuala Lumpur

[1967] 2 MLJ 99. However, I shall briefly address several issues that arose

in this case.

Subject land as a comparable

The first issue would be the use of the subject land as a comparable. During 15

the trial, counsel for respondent challenged the objector that he did not

purchase the subject land at the price of RM260,000. However, she did not

take up his offer to produce the sale and purchase agreement. In her

submission, she took up this issue again. She said that in the absence of the

sale and purchase agreement and the memorandum of transfer, there is no 20

evidence of the said transaction. I shall dismiss this argument for the

following two reasons. My first reason is that the objector gave oral

evidence that he purchased the subject land at the said price. Oral evidence

of this witness is relevant and admissible as he was a party to the transaction.

As to the weight to be attached to his evidence, counsel for respondent did 25

not shake his credibility as he was agreeable to produce the transaction

documents. Counsel for respondent did not follow through with his offer.

[LR. 15-18-2010-III]

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My other reason is this. The government valuer used the transaction referred

to by the objector as a comparable. She is a valuer in the Lands and Surveys

Department. It must be assumed that she has authority to access all relevant

records of sales to assist her in her analysis. In the premises, it is odd that

the counsel for respondent is questioning the authenticity of a transaction 5

which has been used as a comparable by her own witness.

Betterment

Counsel for respondent submitted that the road that cut through the land in

question would have increased the value of the land and that this is a factor

to be considered under section 60 of the Sarawak Land Code. I agree with 10

her but in the instant case, the land in question is a mixed zone land for

agricultural use only. The road project ran through the middle of the almost

rectangular land. The result is a moth eaten land for the objector. The

northern portion is too small for even residential use. The southern portion

is slightly bigger but well below one acre in size to be viable for agricultural 15

use. The condition of usage is still agriculture. Therefore, there is very little

betterment for the objector in spite of the road access. Counsel for

respondent submitted that the condition of usage could be converted to

residential. However, it is matter of speculation whether the objector would

succeed in getting his land usage condition changed. In any event this would 20

entail considerable expense. Therefore, it is my opinion that the significant

adjustment of 20% made by the government valuer is not justified.

Opinion of Assessors

The first assessor gave his opinion that the subject land was worth RM18.5

psm. However, he gave no reason whatsoever for his opinion. As the court 25

is not bound by the opinion of the assessors, I exercised my discretion not to

give any weight to his opinion. The second assessor gave detailed reasons

[LR. 15-18-2010-III]

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for his opinion. He had noticed that due to the numerous transactions in the

vicinity of the subject land, similar lands had been sold at diverse prices.

Therefore, he chose the best comparable from the objector’s list of sales and

the respondent’s list of sales for comparison with suitable adjustment. In

respect of the government valuer’s list, he chose the subject land. I note that 5

it has been said in a number of cases that the subject land is the best

comparable. He made a 30% adjustment for severance in favour of the

objector. In my view, this is very high adjustment as the southern part of the

land, although may not be viable for agricultural purposes, may still have

other uses. In my view, a 20% adjustment would have been reasonable. 10

However the 30% adjustment for severance which I disagree is offset by the

10% adjustment in favour of the government in regard to betterment which

in my view is not necessary. He also made a 5% adjustment for time of sale.

After overall adjustment he opined that the subject land was worth RM16.65

psm. In respect of the respondent’s valuer’s list of sales, he used sales 5 and 15

6. In my opinion, sale 5 is not suitable as it is very close to the Matang

township. After adjustment to sale 6 for location and partial transfer, he

arrived at a market value of RM15.75 psm. After comparing both sales, the

2nd Assessor chose the market value based on sale 1 which is the subject land

valued at RM16.65 psm. In my opinion, sale 1 as the subject land is the best 20

comparable as the parties’ valuers have chosen comparable sales with

diverse prices. As I agree with the overall adjustment made by the 2nd

Assessor, in my judgment, the compensation should have been based on

RM16.65 psm. The total compensation for the acquired portion of the

objector’s land should have been RM227,155.95. As the Superintendant has 25

paid RM141,200, the balance payable shall be RM85,955.95 on which 4%

interest is payable from date of acquisition, i.e. 24th January 2006 until

payment. In compliance with section 67(c) of the Land Code, as the amount

claimed does not exceed the amount awarded by 20 per cent, I shall award

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costs to the objector. As the parties have agreed on the costs, I shall award

the objector the agreed costs of RM20,000.

(RAVINTHRAN PARAMAGURU) 5

Judicial Commissioner

Date of Delivery of Judgment: 5.1.2011

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Date of Hearing: 4.3.2009

6.5.2009

23.7.2009

26.8.2009

14.5.2010 15

28.7.2010

29.10.2010

4.1.2011

For Objector: Mr. Arthur Lee 20

Messrs Arthur Lee, Lin & Co. Advocates

Kuching

For Respondent: Ms. Ivy Suli Untup

State Legal Officer 25

State Attorney General Chambers

Kuching

Assessors: Mr. Terence Yap Wei Tzen

Encik A’zmi bin Abdul Latif 30

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Notice: This copy of the Court's Reasons for Judgment is subject to editorial

revision.