Govt ordered to transfer Duta land to Semantan Estate liquidators

• High Court judge Datuk Ahmad Shahrir Mohd Salleh allowed Semantan Estate’s application, to give effect to the order the company had obtained since 2009 — in one of the longest-standing civil land disputes since Merdeka — back to the liquidator after the court dismissed the government’s application for an adjournment of Tuesday’s hearing pending a proposed settlement by the government on the issue.

KUALA LUMPUR (Aug 7): In a decision that is expected to affect the land industry in the city and the government, the High Court on Tuesday has allowed the application by the liquidator of Semantan Estate (1952) Sdn Bhd for the 263.27-acre land in Mukim Batu — known as the “Duta enclave” that currently houses various government complexes and facilities — to be transferred back to the company.

High Court judge Datuk Ahmad Shahrir Mohd Salleh allowed Semantan Estate’s application, to give effect to the order the company had obtained since 2009 — in one of the longest-standing civil land disputes since Merdeka — back to the liquidator after the court dismissed the government’s application for an adjournment of Tuesday’s hearing pending a proposed settlement by the government on the issue.

“The court orders the defendants to carry out the terms sought within three months of today,” the judge said in his decision after hearing oral submissions from lawyers representing the liquidator and government representatives from the Attorney General’s Chambers, after rejecting the application for adjournment.

Ahmad Shahrir ordered the government to pay costs of RM50,000.

The 263.27 acres were acquired by the government in 1956 to be transformed into what they called “the Duta enclave”. Currently, it houses government buildings that include the Tun Razak hockey stadium, the Malaysian Institute of Integrity, the National Archives, the Kuala Lumpur Syariah Court, the government complex building along Jalan Duta (the Inland Revenue Board building), the Malaysian Anti-Corruption Commission Academy, and possibly portions of the Federal Territory mosque.

In 2009, High Court judicial commissioner Zura Yahya ruled that the liquidator of Semantan Estate is the beneficial owner of the 263.27-acre land, and that the government had taken unlawful possession of and trespassed on the land.

The Court of Appeal and the Federal Court in 2013 had upheld the High Court’s decision. The apex court had also dismissed the government’s review application in November 2018.

The decision on Tuesday for the transfer of the 263.72-acre land within three months, free of encumbrances and liabilities from today, does not include the liquidators’ application for mesne profit damages sought by the plaintiff which is still pending.

Ahmad Shahrir, in allowing the application, also instructed:      

*An order for the government and its agency to have the liquidator of Semantan Estate to be registered as the proprietor of the land that is free of encumbrances,
*Execution of the instruments of the land transfer,
*Issue and cause to be issued of the land title to the plaintiff,
​*The returning and handling of the possession of land to the plaintiff as the lawful proprietor.

The company had named the Registrar of the Federal Territory of Kuala Lumpur Land as the defendant.

Govt tried to adjourn hearing by three months

Before the decision, Senior Federal Counsel Mohammad Al-Saifi Hashim, who appeared with Senior Federal Counsel Shamsul Bolhassan, had sought an adjournment of Tuesday’s hearing for about three months, citing a possible settlement.

However, Ahmad Shahrir said there has been talks of settlement since 2013.

Semantan Estate senior counsel Ira Biswas, who appeared with Janet Chai Pei Ying and Alexie Ng from Messrs Chooi & Co, admitted that the government had tried to settle the matter since 2013 until 2016, but to no avail.

“However, it (the government) filed a review of the Federal Court’s decision made in 2012, which upheld the High Court’s decision. This has resulted in our client filing proceedings in 2017 before the apex court to dismiss the review by the government in November 2018,” Biswas said.

Ahmad Shahrir also noted that proceedings had been adjourned since May, following talks of settlement.

Similar reasons were cited at the Court of Appeal proceedings to this case.

Following this, Ahmad Shahrir directed the proceedings to begin and directed that oral submissions be made.

He asserted that he had already read all submissions on the matter.

Biswas reminded the court of Zura’s decision that had been upheld by the Court of Appeal and the Federal Court, and the dismissal of the government’s review by the apex court.

She said that their client was entitled to have the transfer of the land be done, as the courts had ruled that the government had trespassed (on the land).

Shamsul in reply said that they stood by the submission and that the liquidator did not hold beneficial interests.

Following the end of the submissions, Ahmad Shahrir allowed for the transfer of the land to be made as sought.

When met after the decision, Shamsul and Mohammad Al-Saifi said they would seek instructions (from the attorney general) over the matter. The government is likely to apply for a stay of Tuesday’s decision.

Background to the dispute

The land was acquired by the government in 1956 for the price of RM1.32 million under the then-Land Acquisition Enactment, for the purpose of developing a diplomatic (Duta) enclave.

In 2009, the High Court ruled that the government had trespassed on the land, and in 2012, this decision was upheld by the Court of Appeal and the Federal Court.

In November 2018, a Federal Court bench, led by then-Court of Appeal president Tan Sri Ahmad Maarop, dismissed the Malaysian Government’s application to review the 2012 decision, resulting in that judgement remaining intact.

Semantan Estate claimed it had retained its beneficial interest in the 263.27 acres of land in Mukim Batu, which it alleged the government had taken unlawful possession of, and that the government should pay the company mesne profits as damages for trespassing, with the said damages to be assessed by the court.

Mesne profits are “the rents and profits which a trespasser has, or might have, received or made during his occupation of the premises, and which therefore, he must pay to the true owner as compensation for the tort which he has committed”.

During ongoing trials before Ahmad Shahrir, the company’s valuation of the mesne profit from 1957 to 2021 amounted to between RM3.1 billion and RM6.646 billion with simple interest, and RM13.242 billion with compound interest.

The government valuer from the Valuation and Property Services Department in the Ministry of Finance disputed the sum, and claimed that the compensation should be RM290 million.

The matter with regard to mesne profit is still pending.

Looking to buy a home? Sign up for EdgeProp START and get exclusive rewards and vouchers for ANY home purchase in Malaysia (primary or subsale)!