SETIAKON ENGINEERING SDN. BHD. 1. ) MAK YAN TAI 2. ) MAK KHUM PHOI AMICUS CURIE MALAYSIAN BAR

SETIAKON ENGINEERING SDN. BHD. 1. ) MAK YAN TAI 2. ) MAK KHUM PHOI AMICUS CURIE MALAYSIAN BAR

The Federal Court held that setting aside a judgment in default does not automatically annul or render void ab initio subsequently acquired registered titles where those third parties were not party to the setting‑aside proceedings; registered title remains presumptively indefeasible absent a pleaded and proved case of fraud, forgery or a void instrument under s.340, and a purchaser who conducted standard land registry searches, obtained the SPA and financed the purchase was a bona fide purchaser for value within the proviso to s.340(3).

Citation
02(f)-55-09/2023(W) (Mahkamah Persekutuan)
Parties
Appellant: Setiakon Engineering Sdn Bhd; Respondent: Mak Yan Tai; Respondent: Mak Kum Phoi
Court
f
Jurisdiction
Malaysia
Judgment Date
29 July 2024
Case Number
02(f)-55-09/2023(W) (Mahkamah Persekutuan)
Procedural Posture
Civil Appeal / Final Judgment at Federal Court
Outcome
Appeal allowed
Legal Topics
National Land Code, Torrens System, Section 340(2) and 340(3), Indefeasibility of Title, Setting Aside Default Judgment, Fraud Pleading, Due Diligence of Purchaser
Source Language
Malay/English
Property Law Land Law Civil Procedure Equity National Land Code Torrens System Section 340(2) and 340(3) Indefeasibility of Title +3 more

Case Brief

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Parties

Setiakon Engineering Sdn Bhd

Appellant

Mak Yan Tai

Respondent

Mak Kum Phoi

Respondent

Procedural Posture

Civil Appeal / Final Judgment at Federal Court

Legal Issues

  1. 1 Whether setting aside a judgment in default automatically annuls subsequently acquired registered titles
  2. 2 Whether transactions effected during the pendency of a default judgment are void ab initio when the judgment is later set aside
  3. 3 Whether fraud can be relied upon at appellate stage absent a pleaded case and particulars of fraud

Ratio Decidendi

The Federal Court held that setting aside a judgment in default does not automatically annul or render void ab initio subsequently acquired registered titles where those third parties were not party to the setting‑aside proceedings; registered title remains presumptively indefeasible absent a pleaded and proved case of fraud, forgery or a void instrument under s.340, and a purchaser who conducted standard land registry searches, obtained the SPA and financed the purchase was a bona fide purchaser for value within the proviso to s.340(3).

Court Disposition

Appeal allowed

Orders

  • The appeal is allowed
  • The decision of the Court of Appeal is set aside