Kilang Kelapa Sawit Morib Sdn. Bhd. (GRN 251531) v Pentadbir Tanah Kuala Langat

Case Significance

Illustrates how a court in a land reference under the Land Acquisition Act 1960 selects reliable comparable transactions and adjusts a compensation award, disregarding a comparable whose per-unit value could not be isolated from a bundled sale and raising the land value with additional severance compensation.

This High Court decision is a land-reference proceeding in which the landowner objected to the compensation awarded by the Land Administrator for the acquisition of part of its estate for a 500kV power-transmission line project in Kuala Langat, Selangor. The applicant, the beneficial owner of a large parcel of permanent-tenure land without any category of land use, had part of that land acquired, and objected to the award on the value of the land, on the failure to compensate for injurious affection, and on incidental costs, claiming a land value of RM130 per square metre. The reference was heard with the assistance of a government assessor and a private assessor. Central to the dispute was the choice of comparable transactions: the applicant's valuer relied on a particular lot as the most appropriate comparison, but the court accepted the view of the government assessor and valuer that this comparable was unsuitable, because the lot had been sold together with several other properties and assets for a lump sum under a supplemental agreement, so that its true per-unit value could not reliably be isolated, and the applicant's valuer had no information about that agreement. Preferring the common comparison adopted by both assessors, and taking their adjustments into account, the court fixed the land value within the range they indicated and adopted the figure most favourable to the applicant. It allowed part of the objection, raising the land value from the awarded RM83 to RM100 per square metre, and ordered additional compensation for the land value together with additional compensation for the severance of two portions and a late-payment charge at 5% per annum from the date of the Form K. The court's approach reflects that in a land reference the reliability of a comparable turns on whether its transacted price can be attributed to the subject property alone, and that a bundled sale of several assets for a single lump sum offers no safe basis for a per-unit valuation. The judgment illustrates how a court in a land reference selects reliable comparables and adjusts a compensation award, with the assistance of assessors, to arrive at a value most favourable to the landowner within the supportable range.