C3347/UNIT7/1

UNIT 7

LAND ACQUISITION THE LAND ACQUISITION

ACT 1960, ACT 486

OBJECTIVES

General Objective

To understand the concepts and procedures of acquisition of land under the Land
Acquisition Act 1960, Act 486.

Specific Objectives

At the end of the unit you will be able to:

identify the authority which has been empowered to acquire land compulsorily,
state the purposes of compulsory acquisition,
identify the types of land that may be acquired,
identify the state officers that are allowed to enter land scheduled for compulsory
land acquisition,
describe the general steps in the acquisition of land,
review the detail steps in the acquisition of land,
discuss the rights of dispossessed proprietors and interested persons to appeal,
discuss the role of Court in the land acquisition process,
explain compulsory land acquisition for temporary occupation or use of land.
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INPUT

The Land Acquisition Act (LAA) 1960, Act 34 came

into enforcement on the 13th . October 1960. Since
then, many amendments have been made to the
act. In 1992 the act was revised and was known as
LAA 1960, Act 486. In 1998, the act once again
was amended with the enforcement of Act 999.

The purpose of LAA 1960, is to process land acquisition and pay equitable
compensation. The creation of this act is in accordance to the specification of
Item 13(2) which states that no law is allowed to make provision for compulsory
acquisition or taking of properties without paying equitable compensation.

Although land may be purchased from the proprietor for development purposes,
compulsory acquisition is preferred by the government. This may due to the fact
that:

a) It is difficult for both the proprietor and the party that needs the land to
come to an agreement over the price of land.
b) The land purchased is subject to condition contrary to the use that is
intended. Therefore the condition needs to be changed. This can cause a
lot of inconvenience.
c) The land bought may also be subjected to encumbrances like charge, lien
and tenancy that are exempted from registration.

By compulsory acquisition, the land can be obtained even if the proprietor does
not agree to sell it and no bargaining over the price is necessary. Once a memorial
under section 23 of the LAA is made with respect to any land, that land shall vest
in the State Authority as State Land free from encumbrances.
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7.1 AUTHORITY TO ACQUIRE LAND COMPULSORILY

Under the LAA 1960, the State Authority is the only authority empowered to
acquire land compulsorily. In exercising its power, the State Authority can
delegate it to certain person such as the Menteri Besar under the Delegation of
Powers Ordinance, 1956.

7.2 PURPOSES OF COMPULSORY ACQUISITION

Section 3 of LAA 1960, provides that the State Authority may acquire land which
is needed:-

a) for any public purposes,

b) by any person or corporation undertaking a work which in the opinion of
the State Authority is beneficial for the economic development of the
whole of or some part of Malaysia or to the public or a section of the
public, or
c) for the purpose of mining or residential, agricultural, commercial,
industrial or recreational or the combination of any of the uses mentioned.

The term public purpose can be said to include a purpose in which the general
interest of the community, rather than for a particular interest of a person, is
directly or vitally concerned. In this respect, acquisition of land for school,
hospital, community hall and road is regarded to be for a public purpose.

7.3 LAND THAT CAN BE COMPULSORILY ACQUIRED

As defined in section 2(1), land that can be compulsorily acquired may be one of
the following:

a) Alienated land within the meaning of the State land law,

b) Land occupied under customary right,
c) Land occupied in expectation of title such as Approved Application (AA)
or Surat Akuan,

Note that land held under a

mining certificate or a
mining lease cannot be
acquired compulsorily.
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7.4 RIGHT OF STATE OFFICERS TO ENTER LAND INTENDED FOR

COMPULSORY ACQUISITION

Section 5 of the LAA, 1960, provides that any officer or person, together with
servants and workmen authorized by the State Director by virtue of written
authority in Form B, shall have the right at all reasonable times to enter any land
for the purpose of the Act.

The LAA 1960 defines State Director as

a State Director of Lands and Mines
appointed under the State land law and
includes a Deputy State Director of Lands
and Mines. Please review sec. 1.7.2 of this
module or sec. 12 of NLC to refresh your
memory on state officers.
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Activity 7a

TEST YOUR UNDERSTANDING BEFORE YOU CONTINUE WITH THE NEXT

INPUT.!

Circle the correct answer

7.1 The _______________is the only authority empowered to acquire land compulsorily.
A) Menteri Besar
B) State Authority
C) State Government
D) Federal Government

7.2 Compulsory acquisition, rather than purchase of land is preferred by the government
because of the following reasons except
A) agreement over the price of land is difficult to reach.
B) the land bought may also be subjected to encumbrances that are
exempted from registration.
C) payment of compensation in the case of land acquisition is normally
cheaper than the market value of the land.
D) the land may be subjected to conditions contrary to the use that is
intended and changing this can cause a lot of problems.

7.3 The following types of land may be compulsorily acquired except

A) mining land
B) alienated land
C) customary land
D) land occupied in expectation of title

7.4 Identify the state officers that are allowed to enter land intended for compulsory
acquisition by virtue of written authority in Form B.
I. Workmen III. Settlement Officer
II. Survey Officer IV. Land Administrator

A) I, II and III
B) I, III and IV
C) II, II and IV
D) I, II, III and IV
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Feedback to Activity 7a

7.1 B
7.2 C Well done!Weve gone
7.3 A through the answers, if you
7.4 D
are still confused,come and
see me after the class

TttTttt
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INPUT

7.5 PROCEDURES OF COMPULSORY LAND ACQUISITION

Application for land acquisition may be made to the Land Administrator. Upon
receiving any application for land acquisition, the Land Administrator shall
transmit the application and the accompanying documents to the State Economic
Planning Unit or in the case of an application made in the Federal Territory of
Kuala Lumpur, to the Committee if he is satisfied that they are in order.

The State Economic Planning Unit or the Committee for the Federal Territory of
Kuala Lumpur shall, after it has considered each application transmit the
application with the accompanying documents and a report of negotiations, if any
to:
a) the Committee, in case of a State, or
b) the State Authority, in case of the Federal Territory of Kuala Lumpur.

On receiving the application, the Committee, in the case of a state shall evaluate
the appropriateness of the application and shall no later than two months from the
date of receiving the application, transmit it to the State Authority together with
such recommendation as it thinks fit.

The final decision on whether to approve or reject the application is made by the
State Authority.

The detail procedures for land acquisition can be divided into six categories
namely:

a) Request for acquisition, investigation and gazetting

b) Enquiry and order
c) Payment of compensation
d) Formal possession of the land
e) Reference to court
f) Revision of rent, resurvey and issue of title in continuation where part of
the land is taken.
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7.5.1 Request For Acquisition, Investigation And Gazetting

The request for acquisition of land can be from Federal Department, State
Department or from a Federal or State statutory body or from private person or
body. The request must be made in a form that is specified under KPTG Circular
3/79. Relevant documents must also be accompanied (see sect 3(3), LAA 1960).

In some situations the land must first be investigated for its suitability for a certain
project and to avoid any ultra vires intention of unscrupulous party with regard to
the amount of compensation. To carry out this investigation, gazetting under
section 4 is made by notification in Form A. Land Administrator shall publicized
the notification by displaying public notice board of the Land Office where the
land affected is situated or other places that the Land Administrator thinks fit.

If it is necessary to carry out detail investigation on the land, the State Director
will issue permission letter in Form B to allow relevant officers to enter the land
to conduct site suitability study.

If it is not necessary to carry out any investigation on the land or if the land has
been gazetted under section 4, a paper prepared for the EXCO will be forwarded
to the State Authority for approval. This will be gazetted under section 8 of LAA
1960. The paper will be attached with Form C which contains the list of land
involved, the name of proprietors and a plan of the land to be acquired.

When the State Authority approves the acquisition, a declaration under section 8
is made by using Form D and is published in the Government Gazette together
with a copy of Form C. This declaration will be ineffective after two years if
during this period Land Administrator does not carry any investigation and offer
any compensation.

Immediately after the declaration, section 9 requires that Land Administrator to

cause the areas affected by the acquisition to be marked out upon the land. He
should also make a note of intended acquisition in the register document of title or
other appropriate record.

Next, under section 10 the Land Administrator will issue a public notice in Form
E indicating that early steps on the hearing of all enquiries on payment of
compensation have started. The date of hearing will also be fixed. The date must
be more than 21 days from the date of issuance of Form E.

Any applicant may withdraw from the acquisition of any land before the
publication of the declaration under section 8 by giving a notice in writing to the
Land Administrator.
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7.5.2 Enquiry And Order

The procedure for enquiry is governed by section 12. On the date of enquiry,
Land Administrator will:
a) investigate on the valuation of land to be acquired,
b) assess the amount of compensation,
c) enquire on the interest of all persons claiming compensation or who in his
opinion are entitled to compensation and objections, if any.

Section 13 gives Land Administrator the power to get a written report on the
valuation of land and to call and question witnesses in order to administer oaths or
affirmations. He may also order that relevant documents be submitted to him.

The Land Administrator may for a sufficient reason postpone any enquiry or
adjourn any hearing of enquiry from time to time. Written award in Form G
should be prepared upon conclusion of the enquiry. The award should specify:
a) the amount of compensation
b) total area being acquired
c) apportionment of compensation payment
d) cost and expenditure, if any

7.5.3 Payment Of Compensation

Having prepared the written award, the Land Administrator shall serve or cause to
be served the notice of award and offer of compensation in Form H on each
interested person. The notice should also be served on the applicant and the
proprietor.

The proprietor and interested person,

has three choices upon receiving Form
H, ie. to duly accept the award, to
accept it with objection or to object
it. The applicant can only either accept
it or object it.
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If during the enquiry, the Land Administrator decided that:

i. there is no one eligible for compensation or
ii. the person has objected upon receiving Form H, or
iii. there is a dispute as to the right or title of the person to receive the
compensation, or as to the apportionment of compensation,

The Land Administrator must as soon as possible deposit the compensation

money to the Court. This is done ex-parte by using the Land Administrators
affidavit.

If the applicant objected, 25% of the amount of the award will be retained by the
Land Administrator. The Land Administrator shall make payment of only
seventy-five per cent of the amount of the award. He shall withhold twenty-five
percent of the award until the expiration of appeal period or if there is further
appeal, the amount of compensation is finally determined by Court. If there is no
reference to Court, the remaining 25% must be paid immediately.

When the amount of any compensation awarded under this Act is not paid or
deposited on or before the due date, late payment charges at the rate of eight per
cent per annum from the due date until the time of such payment or deposit is
payable by the Land Administrator.

7.5.4 Formal Possession Of The Land

Formal possession of the land can only be done in two situations:

a) when Form H is being served,
b) when Certificate of Urgency of Form I is issued.

According to section 19, The Land and Mines Department can issue Certificate
Of Urgency 15 days after the issuance of Form E provided that no building is
involved in the area being acquired.

Formal possession of the land is done under section 22 by issuing a notice of

Form K to the occupier of land. A copy of this notice is sent to the proprietor if he
is not the occupier and the proper registering authority to be endorsed in the
corresponding document of title. When Form K is officially registered in the title,
the State Authority will automatically take formal possession on the scheduled
land.

As provided by section 35, the State Authority may withdraw from acquisition of
any land that has not been taken possession. Notification of every withdrawal
from acquisition shall be published in the Gazette. The Land Administrator has to
take a number of actions as stated in section 35(2) and 35(4) of the Act.
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7.5.5 Reference To Court

Reference to Court may only be made by the Land Administrator either by:
i. His own initiative, or
ii. Application by person interested in any scheduled land.

The Land Administrator may, by application in Form M refer to the court with
regard to the following matters:
i. The true construction or validity or effect of any instrument
ii. The person entitled to a right or interest in land
iii. The extent or nature of such right or interest
iv. The apportionment of compensation for such right or interest
v. The persons to whom such compensation is payable
vi. The cost of any enquiry under the LAA, 1960 and the persons by whom
such costs shall be borne.

Section 37 states that any person interested in any scheduled land may make
objection to:
i. the measurement of the land
ii. the amount of compensation
iii. the persons to whom it is payable
iv. the apportionment of the compensation

Any objection made under section 37 shall be made by a written application in

Form N to the Land Administrator requiring that he refer the matter to the Court.
It must be noted that no objection can be made on the compensation if the amount
does not exceed three thousand ringgit. It must also be noted that if the amount
exceeds fifteen thousand ringgit, the applicants on whose behalf such land was
acquired shall be deemed to be a person interested in any scheduled land and as
such may make objections on any grounds specified above.

On receiving any application, the Land Administrator shall, within six months
refer the matter to the Court by a reference in Form O. Further actions will be
handled by the Court.

7.5.6 Revision Of Rent, Resurvey And Issue Of Title In

Continuation Where Part Of The Land Is Taken

Where only part of a lot is acquired under this Act, the Land Administrator shall
revise the rent payable by the proprietor and shall cause the part retained by the
proprietor to be re-surveyed. The revised rent (if any) shall be re-calculated by
reference to the area of the part as established by the survey and is payable the
following year.
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Where part of a lot has been re-surveyed, the proper registering authority shall:
i. In the case of land held under Registry title or Land Office title, issue title
in continuation to the part retained by the proprietor as if he were issuing
title in continuation to land as a whole,
ii. In the case of land held under title evidence by an entry in the Interim
Register, issue title in continuation to the part so retained will consist of a
fresh folio of the Interim Register which shall replace and shall be in the
same form as the folio relating to the original lot.

7.6 THE ROLE OF COURT

The LAA 1960 gives a new perspective to the role of the Court in the land
acquisition process through the A999/97 amendment. Where the objection is
regarding the amount of compensation, the Court shall appoint two assessors, one
of whom is a Government valuer, to aid the Judge in determining the objection
and in arriving at a fair and reasonable amount of compensation. If the two
assessors differ on the amount of compensation, the Judge may only elect to
concur with the decision of one of the assessors. Any decision made is final and
there shall be no further appeal to a higher Court on this matter.

In cases that are not related to the amount of compensation the Judge will sit
alone and appeal to higher court is allowed if the persons involved are not
satisfied with the decision made by the Judge.

7.7 TEMPORARY OCCUPATION OR USE OF LAND

Section 57 provides that whenever it appears to the State Authority that the
temporary occupation and use of any land is needed:
i. for any purpose specified in section 3, or
ii. in order to carry out public works on any land,

the State Authority may direct the Land Administrator to procure the occupation
or use of any such land for a period not exceeding three years.

Upon receiving such instruction, the Land Administrator will deal with the
proprietor to establish the terms and conditions of occupation and the amount and
method of compensation.

On the expiration of the term of occupation or use, the land shall be restored to
the condition it was before such occupation or use.
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Activity 7b

TEST YOUR UNDERSTANDING BEFORE YOU CONTINUE WITH THE NEXT

INPUT.!

7.5 Match each form with its function:

Form A Authority to enter survey

Form B Schedule of lands affected by land acquisition
Form C Notice that land is likely to be acquired
Form D Notice of enquiry
Form E Declaration of intended acquisition

7.6 Decide whether the following statements are true (T) or false (F).

a. During enquiry, the Land Administrator will only investigate on the valuation
of land to be acquired. _____
b. Written award is made in Form F. _____
c. If there is any objection on the amount of compensation, 75% of the amount
will be retained by the Land Administrator. _____
d. Upon taking formal possession of the land, a copy of Form K is sent to the
registered proprietor of the land if he is not the occupier, the applicant and the
proper registering committee. _____
e. Certificate of Urgency can be issued15 days after the issuance of Form E
provided that no building is involved in the area being acquired. _____
f. Reference to Court can only be made by the land Administrator. _____
g. In cases of appeal on the amount of compensation, if the two assessors
appointed by the Court differ on the amount of compensation, the Judge may
determine the amount himself. _____
h. Temporary occupation and use of any land by under section 57 of the LAA
1960 can only last for a period of 3 years or less. _____
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Feedback to Activity 7b

7.5 Form A Authority to enter survey

Form B Schedule of lands affected by land acquisition
Form C Notice that land is likely to be acquired
Form D Notice of enquiry
Form E Declaration of intended acquisition

7.6 a. F
b. F
c. F
d. F
e. T
f. T
g. F
h. T
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KEY FACTS

1. Proprietors or interested persons of a land cannot object compulsory land

acquisition. They only can object on the items listed out in section 37 of the LAA
1960.
2. Compulsory land acquisition is preferred by the State Authority compared to
purchase of land because it is easier and faster to acquire land compulsorily.
3. The purpose of compulsory land acquisition must be solely for public interests.
Otherwise the validity of land acquisition can be challenged. The Land
Administrator must carry out the land acquisition with due care to ensure that the
action taken does not overrule Item 13 of the Federal Constitution.
4. The LAA 1960 also allows for compulsory acquisition for temporary occupation
or use of land.
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Self-Assessment 7

You are approaching success. Try all the questions in this self-assessment section and
check your answers with those given in the Feedback on Self-Assessment given on the
next page. If you have any problems, discuss it with your lecturer. Good luck.

1. State the purposes of compulsory land acquisition.

2. Describe the general procedures of compulsory land acquisition under
the LAA 1960.
3. Briefly explain the detail steps of land acquisition.
4. Discuss the role of Court in the compulsory land acquisition process.
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Feedback To Self-Assessment 7

Have you tried the questions???? If YES, check your answers now.

1. The purposes of compulsory land acquisition are for:

a) any public purposes,
b) the economic development of the whole of or some part of Malaysia or to
the public or a section of the public, or
c) the purpose of mining or residential, agricultural, commercial, industrial or
recreational or the combination of any of the uses mentioned.

2. Application for land acquisition is made to the Land Administrator. Then, the
Land Administrator will transmit the application and the accompanying
documents to the State Economic Planning Unit or, in the case of an application
made in the Federal Territory of Kuala Lumpur, to the Committee if he is satisfied
that they are in order.

The State Economic Planning Unit, or the Committee for the Federal Territory of
Kuala Lumpur shall, after it has considered each application transmit the
application with the accompanying documents and a report of negotiations, if any
to:
c) the Committee, in case of a State, or
d) the State Authority, in case of the Federal Territory of Kuala Lumpur.

On receiving the application, the Committee, in the case of a State shall evaluate
the appropriateness of the application and shall no later than two months from the
date of receiving the application, transmit it to the State Authority together with
such recommendation as it thinks fit.

The final decision on whether to approve or reject the application is made by the
State Authority.
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3. The brief explanations of the detail procedures for land acquisition are given
below:

a) Request for acquisition, investigation and gazetting

Request for acquisition can be made to the Land Administrator using the correct
form and accompanied by the relevant documents. In some situations the land
must first be assessed for its suitability. If this is the case, then the Land
Administrator will take the necessary steps to allow relevant officers to enter the
scheduled land. If this is not the case, then a paper prepared for the EXCO will be
forwarded to the State Authority for approval. When the State Authority
approves the acquisition, a declaration under section 8 is made by using Form D
and is published in the Government Gazette together with a copy of Form C. This
declaration will be ineffective after two years if during this period Land
Administrator does not carry any investigation and offer any compensation.

Immediately after the declaration, section 9 requires that Land Administrator to

cause the areas affected by the acquisition to be marked out upon the land. He
should also make a note of intended acquisition in the register document of title or
other appropriate record.

Next, under section 10 the Land Administrator will issue a public notice in Form
E indicating that early steps on the hearing of all enquiries on payment of
compensation have started. The date of hearing will also be fixed. The date must
be more than 21 days from the date of issuance of Form E.

b) Enquiry and order

On the date of enquiry, Land Administrator will:

a) investigate on the valuation of land to be acquired,
b) assessed the amount of compensation,
c) enquire on the interest of all persons claiming compensation or who in his
opinion are entitled to compensation and objections, if any.

The Land Administrator may for a sufficient reason postpone any enquiry or
adjourn any hearing of enquiry from time to time. Written award in Form G
should be prepared upon conclusion of the enquiry. The award should specify:
a) the amount of compensation
b) total area being acquired
c) apportionment of compensation payment
d) cost and expenditure, if any.
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c) Payment of compensation

When the written award is prepared, the Land Administrator will notify the
interested persons, the applicants and the proprietor. The proprietor and interested
persons can either duly accept the award or accept it with objection or object it.
The applicant can either accept or object it. If there is any objection, 25% of the
award will be retained by the Land Administrator. He shall make payment of only
seventy-five per cent of the award and withhold the other twenty-five percent
until the expiration of appeal period or if there is further appeal, the amount of
compensation is finally determined by Court. If there is no reference to Court, the
remaining 25% must be paid immediately.

When the amount of any compensation awarded under this Act is not paid or
deposited on or before the due date, late payment charges at the rate of eight per
cent per annum from the due date until the time of such payment or deposit is
payable by the Land Administrator.

d) Formal possession of the land

Formal possession of the land can only be done in two situations:

c) when Form H is being served,
d) when Certificate of Urgency of Form I is issued 15 days after the issuance
of Form E provided that no building is involved in the area being acquired.

Formal possession of the land is done under section 22 by issuing a notice of

Form K to the occupier of land. A copy of this notice is sent to the proprietor if he
is not the occupier and the proper registering authority to be endorsed in the
corresponding document of title. When Form K is officially registered in the title,
the State Authority will automatically take formal possession on the scheduled
land.

The State Authority may withdraw from acquisition of any land that has not been
taken possession. Notification of every withdrawal from acquisition shall be
published in the Gazette.
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e) Reference to court

Reference to Court may only be made by the Land Administrator either by:
i. His own initiative, or
ii. Application by person interested in any scheduled land.

The matters that may be referred to the Court by the Land Administrator are :
i. the true construction or validity or effect of any instrument
ii. the person entitled to a right or interest in land
iii. the extent or nature of such right or interest
iv. the apportionment of compensation for such right or interest
v. the persons to whom such compensation is payable
vi. the cost of any enquiry under the LAA, 1960 and the persons by whom
such costs shall be borne

Section 37 states that any person interested in any scheduled land may make
objection to:
i. the measurement of the land
ii. the amount of compensation
iii. the persons to whom it is payable
iv. the apportionment of the compensation

It must be noted that no objection can be made on the compensation if the amount
does not exceed three thousand ringgit.

f) Revision of rent, resurvey and issue of title in continuation where part of the
land is taken.

Where only part of a lot is acquired under this Act, the Land Administrator shall
revise the rent payable by the proprietor and shall cause the part retained by the
proprietor to be re-surveyed. The revised rent (if any) shall be re-calculated by
reference to the area of the part as established by the survey and is payable the
following year.

4. Where the objection is regarding the amount of compensation, the Court shall
appoint two assessors, one of whom is a Government valuer, to aid the Judge in
determining the objection and in arriving at a fair and reasonable amount of
compensation. If the two assessors differ on the amount of compensation, the
Judge may only elect to concur with the decision of one of the assessors. Any
decision made is final and there shall be no further appeal to a higher Court on
this matter.

In cases that are not related to the amount of compensation the Judge will sit
alone and appeal to higher court is allowed if the persons involved are not
satisfied with the decision made by the Judge.