Friday, January 22, 2010

Indefeasibility of Land Title

I remember reading this case a few years back and felt sad for the land owner, Sun Yok Eng @ Boonsom Boonyanit. She was a Thai national who resided in Thailand but visited Penang from time to time, who lost a plot of land in Tanjung Bungah, Penang to an imposter who forge a report that "she" lost her land title and managed to obtain a certified copy of the title from the Land Office.

This imposter then sold the land to a 3rd party, Adorna Properties Sdn. Bhd. When the real owner found out about it; it was too late as according to the law: Adorna had obtained an indefeasible title notwithstanding the forgery because it was a bona fide purchaser (not knowing it was a forgery) based on Section 340(2) of the National Land Code.

Imagine that - you can lose your land when an imposter steals it from you and quickly sells it to a 3rd party who is unaware of the forgery.

Many people advice putting your land on a caveat or using it to apply a loan to avoid anything like this to happen. When there is a caveat by the bankers, no other transfer of land title can happen without the permission of the bankers. (Did I understand the concept correctly?)

Anyway, I'm happy to read the ruling now is in favour of the original owner and if you google about these cases; this is a landmark to many other cases of forgery by transfering the land title to a third party who is unaware of the fraud.

Background story on the Adorna Properties vs Boonsom Boonyati
Other cases: Heirs fighting fraud land case , Taiwanese loses land in KL

Here is the article on the reversal of the ruling and other links.

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