Q.
English Law and Equity is not in contradiction with Torrens System. Briefly provide your view.
A.
The Civil Law Act 1956 expressly provides under Section 6 that English Law and Equity does not apply in Malaysia insofar the Land Tenures are concerned. Indeed, the Torrens System which has long in existence in the various states is not English Law/Land Law, and more of the Australian system of land administration.
However, being a different system, are they in congruence or in contradiction? This is the debate ongoing by academicians and legal practitioners on whether general principles of equity (which are not peculiar to England Land Law) are also excluded.
There are two views:
View No.1, that equitable principles are totally excluded.
View No.2, that general equitable principles are applicable to the extent that they are not precluded by local legislation and are suitable to local circumstances.
View No.1 rests on the premise that the Torrens System as contained in NLC 1965 is a comprehensive system of land law. In the words of Lord Keith of Kinkel, when delivering the opinion of the Privy Council in United Malayan Banking Corporation Bhd v Pemunggut Hasil Tanah, Kota Tinggi:
"The National Land Code is a complete and comprehensive code of law governing the tenure of land in Malaysia and the incidents of it, as well as other important matters affecting land there, and there is no room for the importation of any rules of English law in that field except in so far as the Code itself may expressly provide for this."
View No.2 is based on the contrary proposition that the NLC does not cover everything. The NLC, according to this view is merely professing the idealistic aspiration to be comprehensive.
Under this view, Torrens System has its flaws. In fact, it only regulates the rights and obligations of the parties after the land is registered under the Torrens System. It does not regulate the land matters before registration. Thus, in the absence of any provision, express or implied, prohibiting the application of general equitable principles, such principles may be applied under s.3(1) Civil Law Act 1956.
And, this view is consistent with s.206(3) of the National Land Code 1965, which states that the provisions of the NLC requiring dealings to be effected in the statutorily prescribed manner shall "NOT affect the contractual operation of any transaction relating to alienated land or any interest therein."
In other words, the general principles of law - particularly, contractual principles - that govern land transactions as a whole are not affected by the National Land Code, which covers merely the system of registration of land titles.
In short, the second view of Torrens System as a system of registration of Land Titles and general principles of equity does apply in Land Matters is a more acceptable view at present. At minimum, Section 6 of Civil Law Act 1956 does not exclude general principles of equity in the English Law to be applicable in land matters. Notwithstanding, there may be still doubts to what extent is the application of equity to land matters under the National Land Code.
Ref:
Wan Arfah Hamzah (2009) A First Look at the Malaysian Legal System. Oxford Fajar. Pg: 136-138.