In the quiet mukim of Batu, a parcel of land once stood as a widow’s last remaining legacy. Wong Har was not a rich woman—just someone who had held on to her little piece of Kuala Lumpur since 1975, when she bought it from a man named Yeap for RM55,000.
For decades, she paid her taxes, kept her receipts, and let time trickle past. Eventually, she passed on. Then one day, her children—now her beneficiaries—noticed something disturbing.
A letter never came.
Instead, the City Hall’s records showed that her mailing address had been changed… not by her, but by someone else. A signature, allegedly hers, sat on a change-of-address form. But it was not hers. The form, like the scheme behind it, was a forgery.
So began a tale worthy of Kafka.
The Shadow Moves
Unbeknownst to Wong Har, someone named Chia Moy had filed a legal claim against her, pretending to act for a woman called Lim Moy, who claimed that she was the true owner of the land.
How could that be?
Chia Moy spun a story: decades ago, Lim Moy had borrowed RM30,000 from Wong Har and used the land as collateral. The land, said Chia Moy, had always belonged to Lim Moy. But now, after over 30 years, she “suddenly remembered” to reclaim it.
None of this made sense. There was no registered interest. No caveat. No documents. Yet the court—unaware of the forgery and deception—granted a judgment in default, as Wong Har never appeared in court (because she was never notified).
With that judgment in hand, Chia Moy approached the Land Office and got the land transferred into Lim Moy’s name.
The trap had been sprung.
The Fast Hand of Profit
Within weeks, the land was sold to a company called Paragon for RM15 million, cash. But Paragon was a shell—barely a month old, run by two young men, with no money in its accounts and no loans taken to finance the purchase.
It didn’t matter. The land was then quickly resold to another company—Setiakon Engineering—for RM17 million.
And just like that, the title was transferred.
On paper, Setiakon was now the owner of a valuable tract of land. But in truth, they stood atop a house of cards built on forgery and fraud.
The Long Climb Back
Wong Har died in 2017, aged 90. Her children, as executors of her estate, dug up the history.
They applied to set aside the original judgment in default. The court agreed: the service had been defective, the documents dubious, the OS never properly served. The judgment that had allowed the land transfer was wiped clean.
And then the court did more.
It declared that everything done based on that fraudulent judgment—the transfer to Lim Moy, the sale to Paragon, and the resale to Setiakon—was void ab initio. Null from the very beginning. Like shadows in the sun.
The Law Speaks
Setiakon fought back. Their argument? They were innocent. They had paid good money. They had no idea about the fraud. Surely, their title was protected under Malaysia’s National Land Code, specifically section 340(3).
But the Federal Court, in a majority decision, disagreed.
The key issue was good faith. The court said: yes, registration confers title—but not necessarily indefeasibility. The shield of section 340(3) only protects bona fide purchasers for value without notice of fraud. And good faith must be proven, not presumed.
Here’s what the court saw:
- Paragon had no financial capacity to buy the land, yet claimed to have paid RM15 million in cash.
- The transaction moved suspiciously fast.
- No independent valuation was done.
- Documents and resolutions were missing or not disclosed.
- The earnest deposit was paid before any land search.
To the court, it all stank.
Setiakon had taken comfort in the conclusiveness of the land register (under section 89 of the NLC), but failed to ask the right questions. They closed their eyes, when the law demanded they look.
Thus, the court ruled: the title was defeasible. And the land must return to the heirs of Wong Har.
🎓 Legal Reflections: A Lesson in Indefeasibility
The Setiakon case is a sobering reminder for lawyers, buyers, and land professionals. In Malaysia, while registration under section 89 of the National Land Code gives rise to a presumption of title, this presumption is not absolute.
Indefeasibility—under section 340—can be defeated where:
- There is fraud or forgery in obtaining the title (s 340(2)),
- Or where the purchaser is not bona fide or fails to give valuable consideration (s 340(3)).
The Federal Court emphasized:
- Mere registration does not protect a title obtained through fraud.
- A purchaser must prove actual good faith, not just reliance on the title register.
- Courts will examine the entire chain of transactions to determine if the final buyer was complicit—or willfully blind.
Practitioners should take note: title searches alone are not enough. When the purchase price is high, the chain of ownership short, and the vendor’s history unclear, the buyer must (should) ask questions. Otherwise, the title—however official—may not be safe.
Epilogue: Fact and Fiction
The article you are reading was written as a creative nonfiction piece based on the Federal Court decision in Setiakon Engineering Sdn Bhd v. Mak Yan Tai & Anor [2024] 5 MLRA 791.
It is a landmark case in modern Malaysian land law. A reminder that fraud, however cleverly disguised, leaves a trail. And that the law, though sometimes slow, catches up.
The land belongs once again to the family who never stopped believing that the truth would prevail.
Important Notice
This article was prepared to provide education and entertainment to our readers. Please do not consider it as a substitute for competent legal advice from a licensed lawyer. The photograph that appears at the top of this page is merely for illustration, and was gotten for free from Pexels.
Thanks for reading. For questions on indefeasibility, fraud, or land transactions, you may contact our office for assistance.