KH-BASE ENGINEERING SDN BHD v 1. ) RHB BANK BERHAD 2. ) Pentadbir Tanah Daerah Seberang Perai Tengah

Case Significance

Illustrates the limited grounds on which the High Court will set aside a Land Administrator's Order for Sale of charged land under the National Land Code 1965, and the enquiry and service safeguards that precede such an order.

This High Court decision at Penang concerns a statutory appeal against an Order for Sale of charged land made by a Land Administrator under the National Land Code 1965. The plaintiff, KH-Base Engineering Sdn Bhd, was the registered proprietor of land which it had charged to the first defendant, RHB Bank Berhad, as security for banking facilities. Following a default, RHB obtained an Order for Sale, issued in Form 16H dated 23 January 2025 by the second defendant, the Land Administrator for the District of Seberang Perai Tengah, under sections 257 and 263 of the National Land Code. The plaintiff's originating summons, brought under Order 55A of the Rules of Court 2012, was its appeal against that Order for Sale. Two central issues arose: the validity and sustainability of preliminary objections raised by both sides, including the plaintiff's objection to a correction affidavit (Afidavit Pembetulan) filed after written submissions and after the exchange of affidavits had closed, and the substantive merit of the appeal against the Order for Sale. In examining the substantive challenge, the court set out the statutory scheme governing the Land Administrator's conduct of an enquiry, including the requirements for service of the summons to appear and the discretion to proceed or adjourn where parties do not appear, and found that there had been no breach of statutory duty and no violation of the rules of natural justice in the making of the order. The court accordingly held that the Order for Sale had been validly made in accordance with the National Land Code, and, per Choong Yeow Choy J, dismissed the originating summons with costs assessed at RM5,000 to the first defendant and RM2,000 to the second defendant. The judgment is a useful example of the limited grounds on which the High Court will disturb a Land Administrator's Order for Sale under the National Land Code, and of the strictness of the enquiry and service requirements that precede such an order.