Court finds Selangor land office negligent, orders RM1.1mil award for land fraud victim

New Straits Times

17-07-2025

SHAH ALAM: A senior citizen was awarded more than RM1.1 million in damages by the High Court here after falling victim to a land scam involving an impostor who fraudulently sold him a property using a fake identity card.
Judicial Commissioner Indra Nehru Savandiah ruled in favour of Ng Kin Song @ Ng Thian Song, finding that negligence and statutory breaches by the Selangor Land and Mines Department and the Klang Land Office had enabled the fraudulent transaction.
According to court documents, Ng unknowingly purchased a parcel of land in the Klang district in 2016 from an individual impersonating the rightful owner, Yeoh Ah Guan.
The actual Yeoh only discovered the fraud when he visited the Klang Land Office on Aug 30, 2018, to pay quit rent and found that the land had been transferred to Ng's name. He lodged a private caveat on Sept 5 of the same year.
On Sept 14, 2018, Ng was informed by the police that he had unknowingly purchased the land from an impostor, and that the real Yeoh was never involved in the transaction.
Ng later filed a lawsuit naming, among others, the Selangor Land and Mines Department, the Klang Land Office, and the state government as defendants, claiming they had breached their statutory duties under the National Land Code 1965 and acted negligently by issuing the computerised title document (DHKK title) on May 8, 2017.
The defendants denied the plaintiff's allegations, arguing that their role was purely administrative and that there was no evidence to show they had acted in bad faith.
They further contended that it would be unfair to hold them liable for negligence over the fraudulent transaction involving the 13th defendant's land, as they were not directly involved in any fraudulent conduct.
The court, however, disagreed with the defendants on the grounds that the state authorities failed in their legal and procedural duties, resulting in two concurrent titles being issued for the same piece of land.
"It is an undisputed fact that the land office failed to follow its standard operating procedure by issuing a computerised DHKK title without retrieving the manual title from the Yeoh.
"Yeoh was never informed to surrender his original manual title to the land office. Schedules 14 and 16 of the National Land Code 1965 have been compromised by the land office.
"The land office did not explain why they failed to notify Yeoh to surrender his manual title in exchange for the computerised DHKK title," Indra said in her judgment dated April 30 this year.
The court said Ng's purchase of the land in 2016 was made in good faith, based on standard legal procedures, including a land search, but was later found to be based on false documentation submitted by the impersonator.
The court further took issue with the land office's refusal to disclose the identities of staff members who had processed the fraudulent transaction.
"It is important to note that the Klang Land Office's refusal to disclose their personnel's names to the plaintiff constitutes bad faith conduct."
Indra said the defendants could not rely on statutory immunity to escape liability for their mismanagement and failure to act on red flags.
"They cannot rely on Section 22 of the National Land Code 1965 to avoid the consequences of the mess they have caused, which ultimately resulted in an innocent man losing ownership of his land and another elderly man losing his money over a fraudulent transaction involving the same land.
"The simple failure to follow the statutory requirements under the National Land Code 1965 to keep accurate records constitutes a breach of the common law duty of care," she added.
The court awarded Ng RM1,188,631 in special damages, with general, aggravated, and exemplary damages to be assessed.
The defendants were also ordered to pay RM30,000 in costs and five per cent annual interest until full settlement.
Yeoh's counterclaim to be declared the rightful owner of the land was also allowed.
The defendants have since filed an appeal at the Court of Appeal against the High Court's decision.