Overview

Conveyancing is an act of transferring the ownership (legal title) in a property from one person to another. The conveyancer (solicitor) generally assists the parties in the sale and purchase transaction from the point negotiation begins until the title of the property is transferred to the purchaser.

A typical conveyancing transaction can be divided into three stages namely, pre-contract, before completion and after completion.

Land ownership in Malaysia is contained in four primary pieces of legislation – namely, the National Land Code 1965 (Act 56 of 1965); the National Land (Penang and Malacca Titles) Act 1963; the Sarawak Land Code; and the Sabah Land Ordinance. Due to historical and political developments, the National Land Code 1965 applies to Peninsula Malaysia, the National Land (Penang and Malacca Titles) Act 1963 apply only to the states of Penang and Malacca and the Sarawak Land Code and the Sabah Land Ordinance apply to the states of Sarawak and Sabah respectively.

The National Land Code is not available online and therefore practitioners will require a paper copy for reference purposes.

These four primary pieces of legislation are supplemented by subsidiary legislation passed by the respective states in Malaysia.

Land in Malaysia is vested in the ruler or governor of the state. Although land is a state matter upon which only the state legislature may make laws in respect thereto, the Federal Government may nevertheless make laws in respect of land matters in a state if such laws are enacted to ensure uniformity of law and policy in respect of land matters in all the states.

The case of East Union (Malaya) Sdn Bhd. v. Government of the State of Johor & Government of Malaysia [1981] 1 MLJ 151 held that Article 76 of the Federal Constitution empowers parliament, for the purpose only of ensuring uniformity of law and policy, to pass legislation with respect to inter alia, collection of land revenue.

It should also be noted that there is a specific law governing Malay holdings known as the Malay Reservation Enactment (one uniform legislation covering the states of Perak, Pahang Selangor and Negeri Sembilan and five separate pieces of legislation covering the remaining five states of Johor, Terengganu, Kelantan, Kedah and Perlis). The basic objective of these laws is to restrict any form of dealings affecting these lands by non-Malays.

Apart from this, certain state authorities make it a policy (which they implement when approving development projects) of insisting that a certain percentage of the houses being built by the developer can be sold only to Bumiputra (defined by the Constitution) buyers.

The operation of the four primary pieces of legislation above provides for the Torrens system of title registration which was invented by Sir Robert Torrens an Australian. Under the Torrens system (where “the land register is everything”), ownership is evidenced by having one’s name on the title.

There are three paths to land ownership. The first is by dealings, which concerns sale and purchase transactions. This is done in the prescribed form which is later registered in the land registry upon the completion of the transaction. The second is through inheritance, and the third is acquisition through alienation from the state authority.

Other key legislation that is pivotal in Malaysian conveyancing includes:

• Contracts Act 1950 (Malaysia) 
• Housing Development (Control and Licensing) Act  1966 (Malaysia) 
• Strata Titles Act  1985 (Malaysia) 
• Building & Common Property (Maintenance & Management) Act  2007 (Malaysia) 
• Real Property Gains Tax Act  1976 (Malaysia) 
• Stamp Act 1949 (Malaysia) 
• Solicitors Remuneration Order 1991
• Specific Relief Act 1950

This preview is an excerpt from the following publication. this publication for access to all the commentary and precedents.

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