Landowners, take note

PETALING JAYA (April 21): In a landmark ruling, the Federal Court had yesterday decided that only constitutionally appointed judges can decide on compensation in land acquisitions.

According to a report in theSun daily today, the Federal Court had ruled that a provision in Section 40(A) of the Land Acquisition Act 1960, which gives assessors the right to decide on compensation, was against the Federal Constitution.

Federal Court judge Tan Sri Zainun Ali was quoted as saying that Section 40(A) of the Act is ultra vires to Article 121 of the Federal Constitution on judicial powers and “must be struck down”.

"This provision ignores the role of judges. Compensation should be decided by a judge and no other," she had said in the judgement made by a five-man bench led by Court of Appeal president Tan Sri Zulkelfi Ahmad Makinudin following its unanimous decision for two cases. The other judges on the bench were Tan Sri Hasan Lah, Tan Sri Abu Samah Nordin, Tan Sri Zaharah Ibrahim and Zainun. The ruling only applies to pending and future cases.

Semenyih Jaya Sdn Bhd had sued the Hulu Langat District Land Administrator over compensation after its land was acquired for the construction of a highway in Kajang, Selangor in 1998. The developer was building 57 factory lots when the land was acquired but it was only awarded RM20.8 million. Semenyih Jaya had stated that RM45 million would be a fair amount. The matter was then referred to the High Court where two assessors sat with the judge. The outcome was Semenyih Jaya only received an additional RM160,000 for "injurious affection". In 2013, the Court of Appeal upheld the High Court's decision.

In another case, land owners Amitabha Guha and Parul Rani Paul had also filed a similar suit against the same land administrator.

In allowing Semenyih Jaya’s appeal, the Federal Court’s judgement yesterday also stated that “the sanctity of judicial power is preserved when the single judge who sat with the assessors is not bound by their opinion in arriving at a decision”.

“As such, appropriate compensation by the judge acts also as a safeguard entrenched in the constitution, and must be based on market value at that time.” According the to theSun’s report, the bench had then ordered compensation in both cases to be forwarded before a High Court judge who could consider the opinion of the assessors but would be independent in making his or her ruling.