Tenaga Nasional Berhad v 1. ) SIME DARBY PLANTATION BERHAD 2. ) Pentadbir Tanah Daerah Klang

b-01im-67-02-2023 Court of Appeal (Mahkamah Rayuan) 21 January 2025 • B-01(IM)-67-02/2023 • 18 min read
7 cases cited (0 SG, 7 foreign)

Outcome

For the aforesaid reasons, we allow the appeal and we set aside the decision of the learned Judge. Accordingly, we order Sime Darby (the 1st Respondent) to pay costs of RM20,000.00 to TNB (the Appellant), subject to allocatur. There will be no order of costs against the PTG (the 2nd Respondent).

Quoted verbatim from the judgment of Court of Appeal (Mahkamah Rayuan) (b-01im-67-02-2023). Read the full judgment on the official Malaysia Courts portal for the complete decision.

Catchwords

Compensation — Land reference — Intervention — Application by Tenaga Nasional Berhad (TNB) as paymaster to intervene in land reference proceedings initiated by landowner — Whether paymaster has legal standing to participate without filing Form N — Whether paymaster is a "person interested" under Section 37 of the Land Acquisition Act 1960 — Right of paymaster to safeguard interests against claims for increased compensation — Impact of Article 13 of the Federal Constitution. Intervention — Order 15 rule 6(2)(b) of the Rules of Court 2012 — Application to be added as a party in land reference proceedings — Whether filing of Form N is the sole procedural mode for participation — Applicability of the Rules of Court where the Land Acquisition Act 1960 is silent — Proper mechanism for an interested party who has accepted the Land Administrator's award to participate in proceedings initiated by another party. Stare decisis — Conflicting decisions of the Federal Court — Whether to follow Tenaga Nasional Bhd v Unggul Tangkas Sdn Bhd [2018] or Spicon Products Sdn Bhd v Tenaga Nasional Berhad [2022] — Principle that the later decision of the apex court prevails over the earlier decision — Duty of the High Court to follow the latest established legal propositions. Land Administrator's award — Nature of land reference proceedings — Whether the Land Administrator "defends" the award — Role of the Land Administrator as a provider of justification rather than a traditional defendant — Right of participation for parties whose financial interests are affected by the reference. "Person interested" — "Paymaster" — "Form N" — "Land reference" — Meaning and application under the Land Acquisition Act 1960.

Practice Areas

Constitutional Law Land Acquisition Civil Procedure

Judges (3)

Ahmad Fairuz bin Zainol Abidin Coram Azimah binti Omar Coram Azizah binti Haji Nawawi Delivered

Counsel (11)

Penasihat Undang-Undang Negeri Selangor Firm Steven Thiru & Sudhar Partnership Firm Zain & Co. Firm David Ng Yew Kiat Counsel Appellant Etty Eliany Tesno Counsel Respondent Hani Aziza Ismail @ Aziz Counsel Respondent Isabella Cheah Chooi Mun Counsel Respondent Leah Samuel Counsel Appellant Norfariza Binti Ridzuanhani Aziza Counsel Respondent Raneesha Thayalan Counsel Respondent Steven Thiru Counsel Appellant

Parties (3)

Pentadbir Tanah Daerah Klang Respondent SIME DARBY PLANTATION BERHAD Respondent TENAGA NASIONAL BERHAD Appellant

Case Significance

Confirms that a paymaster who bears the financial burden of a compulsory acquisition may be recognised as a 'person interested' under section 37 of the Land Acquisition Act 1960 and permitted to intervene in the land reference to protect its position on the compensation payable.

This Court of Appeal decision concerns whether a utility that funds an acquisition — a paymaster — may intervene in land-reference proceedings to protect itself against an increased compensation award. The underlying land reference arose from the compulsory acquisition of portions of two parcels of land owned by the first respondent, a plantation company, in Mukim Kapar, Daerah Klang. The appellant, the national electricity utility, was the paymaster funding the acquisition. It applied in the High Court to intervene in the land reference, or alternatively to be granted the right to appear and be heard, but the High Court dismissed that application, and the utility appealed.

The Court of Appeal addressed whether the paymaster had legal standing to participate in the land reference without filing Form N, and whether it was a "person interested" within the meaning of section 37 of the Land Acquisition Act 1960. The paymaster's concern was practical and financial: because it would ultimately bear the cost of any compensation, it had a direct interest in resisting the landowner's claim for increased compensation, an interest the court considered against the backdrop of the constitutional protection of property in Article 13 of the Federal Constitution. The court accepted that a paymaster in that position has a legitimate interest to safeguard in the proceedings.

The Court of Appeal allowed the utility's appeal, with costs awarded to the appellant subject to allocatur and no order of costs against the district land administrator. The effect was to permit the paymaster to participate in the land reference so as to protect its position on quantum. The judgment illustrates that a paymaster who bears the financial burden of a compulsory acquisition may be recognised as an interested party entitled to be heard in the land reference, notwithstanding arguments about the formal mode of entry into the proceedings.

Summary

TNB, as the paymaster for a land acquisition, appealed the High Court's refusal to allow it to intervene in land reference proceedings initiated by Sime Darby Plantation, where the landowner sought substantially increased compensation for land acquired for a 132kV transmission line. The Court of Appeal allowed TNB's appeal, following the Federal Court's decision in Spicon Products which established that Order 15 rule 6(2)(b) of the Rules of Court is the proper mechanism for an interested paymaster to intervene. The Court set aside the High Court's decision and awarded costs of RM20,000 to TNB.

What did the paymaster seek?

The national electricity utility, as the paymaster funding a compulsory acquisition of the landowner's parcels in Klang, sought to intervene in the land-reference proceedings, or to be granted the right to appear and be heard, after the High Court dismissed its application.

What was the legal question?

Whether the paymaster had standing to participate without filing Form N and whether it was a 'person interested' under section 37 of the Land Acquisition Act 1960, given its direct financial interest in resisting an increased compensation award.

How did the Court of Appeal decide?

It allowed the utility's appeal, recognising the paymaster's legitimate interest in the proceedings and permitting it to participate, with costs to the appellant and no order of costs against the district land administrator.

Statutes Cited

Land Acquisition Act 1960 (Cap 486)
s 3(1)(b)
Rules of Court 2012

Cases Cited (7)

MY (7)
[1998] 1 MLJ 125 [2009] 4 CLJ 57 [2011] 2 MLJ 729 [2018] 4 CLJ 285 [2022] 2 MLJ 721 [2022] 4 CLJ 195 [2024] 4 CLJ 1

Judgment

Read the full judgment on the official Malaysia Courts portal.

Read on eJudgment

Source: eJudgment (b-01im-67-02-2023)