BAYU SEMPURNA SDN. BHD. v 1. ) PANG CHEE HUN @ PHANG CHEE HUN 2. ) LIEW SHIN LIAN 3. ) CHAI NYUK JIN 4. ) MERCES BUILDERS (S) SDN. BHD. (IN LIQUIDATION) 5. ) LAND CUSTODY AND DEVELOPMENT AUTHORITY

q-02ncvcw-1365-08-2023 Court of Appeal (Mahkamah Rayuan) 8 January 2026 • Q-02(NCvC)(W)-1365-08/2023 • 21 min read

9 cases cited (0 SG, 9 foreign)

Catchwords

Whether the original purchasers (1st, 2nd, and 3rd Respondents) or the subsequent purchaser (Bayu Sempurna Sdn Bhd) of the subject properties has better title - developer/1st Defendant in liquidation - constructive trusts - whether purchase price must be paid in full - laches - limitation - cross-appeals.

Practice Areas

Land Law Equity & Trusts Limitation

Judges (3)

Azman bin Abdullah Coram Azmi bin Ariffin Coram Lim Hock Leng Delivered

Counsel (10)

Alvin Yong Advocates Kuching Firm Andy and Associates Firm Wung & Co., Kuching Firm Alvin Yong Sze Lung Counsel Appellant Anastasia Chin Mengxing Counsel Respondent Andy Tan Tung Sii Counsel Respondent James Lo Kuin Chuan Counsel Respondent Liew Sheau Kie Counsel Respondent Nicholas Wung Duk Ying Counsel Respondent Shirleen Ong Counsel Appellant

Parties (6)

BAYU SEMPURNA Sdn Bhd Appellant LAND CUSTODY AND DEVELOPMENT AUTHORITY Respondent MERCES BUILDERS Sdn Bhd. (IN LIQUIDATION) Respondent Chai Nyuk Jin Respondent Liew Shin Lian Respondent Pang Chee Hun @ Phang Chee Hun Respondent

Case Significance

Confirms that an original purchaser's interest may take priority over a subsequent purchaser of the same property after the developer's liquidation, and illustrates the appellate court's reluctance to disturb a trial judge's findings on constructive trust, laches and limitation absent plain error.

This Court of Appeal decision concerns the cross-appeal, heard together with a related appeal, arising from competing claims to title over subject properties in Kuching after the developer's liquidation. In this appeal the appellant was Bayu Sempurna Sdn Bhd, the subsequent purchaser, which challenged the High Court's decision preferring the original purchasers — the first to third respondents — who had bought the same properties from the developer before Bayu Sempurna acquired them. The developer, Merces Builders (S) Sdn Bhd, was in liquidation and represented by the Official Receiver, and the Land Custody and Development Authority was also a party to the proceedings.

The central question was whether the original purchasers or the subsequent purchaser held the better title, which engaged whether a constructive trust arose in favour of the original purchasers, whether the purchase price had to be paid in full, and the defences of laches and limitation. The High Court had decided in favour of the original purchasers. On appeal, the Court of Appeal applied the principle that an appellate court will not interfere with a trial judge's findings unless he was plainly wrong. Having considered the various issues advanced by all counsel, it found that the High Court Judge had not been plainly wrong in arriving at his decision, so that appellate intervention was not warranted.

The Court of Appeal dismissed the appeal and the cross-appeals. On costs, it ordered that the appellant, Bayu Sempurna Sdn Bhd, pay total costs of RM50,000.00 to the first to third respondents, subject to the allocatur fee, and made no order as to costs against the Official Receiver, who had taken no part in the hearing. The judgment confirms the priority of the original purchasers' interest over that of the subsequent purchaser and illustrates the limited scope for disturbing concurrent findings of fact on appeal.

Summary

Bayu Sempurna, a subsequent purchaser, appealed against the High Court's decision favouring original purchasers who held constructive trust interests in properties from a developer now in liquidation. The Court of Appeal dismissed the appeal with RM50,000 costs, finding the High Court correctly applied constructive trust principles to protect the original purchasers' beneficial interests.

What was the outcome of the subsequent purchaser's appeal?

The appeal by Bayu Sempurna Sdn Bhd, the subsequent purchaser, was dismissed. The Court of Appeal held that the High Court Judge had not been plainly wrong in preferring the original purchasers' title, and it declined to interfere, ordering Bayu Sempurna to pay RM50,000.00 costs to the first to third respondents.

What issues determined which party had the better title?

The court considered whether a constructive trust arose in favour of the original purchasers, whether the purchase price had to be paid in full, and the defences of laches and limitation. On these, the High Court's decision in favour of the original purchasers was upheld as not being plainly wrong.