CAN AN AUSTRALIAN COURT DECREE THE TRANSFER OF A

MALAYSIAN PROPERTY WITHOUT THE NEED TO ENFORCE THE

FOREIGN JUDGMENT IN MALAYSIA?

Hardial Singh Khaira∗

Recently a judgment was given in the Court of Appeal of the Supreme Court of Western
Australia that seems to suggest that the provisions of the Malaysian National Land Code
1965 can be evaded and bypassed by a foreign court if it gives a judgment in personam
and then decrees the transfer of the Malaysian property consequent to that judgment. The
parties involved would then be required to sign the requisite transfer form in Australia
and the property transferred in Malaysia without recourse to the High Court of Malaya
and the need to enforce a foreign judgment. It is a judgment that can have grave
consequences. The case of Singh v Singh [2009] WASCA 53 concerned a commercial
dispute between two brothers. The appellant consequently became bankrupt. Although
the Trustee in Bankruptcy had already investigated the transactions and decided that there
were no grounds to proceed further, the respondent was seeking to declare that the
transfer of the Malaysian property was fraudulently done to defeat the claims of the
creditors. There was also a prior trust deed made in Malaysia, witnessed by a Malaysian
lawyer, which gave the beneficial interest in the property to a third party. The appellant
and other defendants filed conditional appearances challenging the jurisdiction of the
Australian courts. It was submitted by the appellant (who appeared in person and argued
the case against a Queen’s Counsel and a solicitor representing the respondent) that:

1. The title to the immovable property could be acquired, passed, and lost only
according to the lex rei sitae (i.e. Malaysian land law).

2. There was no evidence to justify the inference that, by the comity of nations, the
jurisdiction to determine the right over the immovable property had been allowed by
Malaysia to Australia. An Australian Court could therefore not pass judgment on
Malaysian law or direct the transfer of a Malaysian property.

3. An Australian court was the forum non conveniens as it was clearly the inappropriate
forum in that:

3.1. It involved immovable property situated in Malaysia and only the High Court
of Malaya had the jurisdiction, under section 340(2) and 417 of the Malaysian
National Land Code 1965, to determine if the transfer of property to the

∗
LL.B(Hons) (UM); LL.M (UWA), Honorary Research Fellow, Murdoch University, Western Australia

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 registered proprietors was fraudulent and to make any relevant orders relating to
the property.

3.2. The Writ of Summons in Australia was brought under section 89(1) of the
Property Law Act 1969 (WA), which had no extra-territorial jurisdiction to
apply in Malaysia or to override the express provisions of section 340 of the
Malaysian National Land Code 1965.

3.3. The continuation of the proceedings in Australia would be vexatious and

oppressive to the Appellant as there was no chance that the respondent could
enforce the order, decree and judgment made by an Australian court in
Malaysia.

4. It was submitted by the appellant that the Reciprocal Enforcement of Judgments Act
1958 (Revised 1972) did not apply as Australia is not a country granted reciprocal
rights under Schedule 1 of the Act. It however did reflect the common law of
Malaysia. Pullin JA, delivering the judgment of the Court of Appeal of the Supreme
Court of Western Australia, decided that:

4.1. It was clear from section 5(2)(a)(iv) of the Reciprocal Enforcement of

Judgments Act 1958 (Revised 1972) that according to the legislation there is no
reason why the judgment of a Western Australian court would not be
recognised in Malaysia if the judgment of the Western Australian court is a
judgment in personam and the judgment debtor was resident in this State when
the proceedings were instituted.

4.2. In coming to that conclusion the Court of Appeal of the Supreme Court of
Western Australia ignored the next provision, i.e. section 5(2)(b), which
basically provides that even in the case of an in personam judgment a Western
Australian court shall not be deemed to have jurisdiction if it involved
immovable property not situated in Western Australia.

4.3. Also ignored by the Court of Appeal of the Supreme Court of Western
Australia was section 5(3) which also basically states that the Western
Australian Supreme Court shall not be deemed to have jurisdiction if the subject
matter of the proceedings was immovable property outside Australia.

5. Comity of Nations.

5.1. The Court of Appeal of the Supreme Court of Western Australia ignored the
rule on the comity of nations, which provides that the courts of the adjudicating

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 state would recognise the legitimate laws of other states, in the expectation that
the other states would in turn also recognise the laws of the adjudicating state
when the need arises. It is recognised as a courteous sentiment that is used to
explain one country's motives for recognising legal rights acquired in another.

6. Malaysian National Land Code versus Property Law Act of Western Australia

6.1. The respondent was seeking a declaration that the transfer of the Malaysian
property was with intent to defraud creditors within the meaning of section
89(1) of the Property Law Act 1969 of Western Australia and the appellant
argued that the Malaysian National Land Code 1965 that grants indefeasibility
of title governs transactions and dealings involving land in Malaysia and not
section 89(1) of the Property Law Act 1969 of Western Australia which had no
extra-territorial jurisdiction to apply in Malaysia.

6.2. The appellant further argued that the registered owner of a property can only be
divested of the property by directions given to the Registrar of Titles by the
High Court of Malaya under section 417 of the Code.

6.3. The Court of Appeal of the Supreme Court of Western Australia however
concluded that section 89(1) of the Property Law Act 1969 of Western Australia
had extra-territorial jurisdiction as it confers a right on certain persons to avoid
fraudulent dispositions of property carried out with fraudulent intent and that
right extended to immovable property out of the jurisdiction.

7. Enforcement of a Western Australian Judgment in Malaysia

7.1. The appellant submitted that any judgment obtained in Australia in relation to
the transfer of land in Malaysia would be brutum fulmen (an empty judgment)
and would render the proceedings futile. While the Court of Appeal of the
Supreme Court of Western Australia accepted the respondent’s admission that
any judgment obtained in the Supreme Court of Western Australia could not be
registered in Malaysia, it concluded that parties could be coerced into signing
the necessary transfer form and the transfer taken to Malaysia and registered in
the Malaysian Office of Titles. There would be no need to enforce the
judgment in Malaysia. It effectively seeks to evade and bypass the National
Land Code 1965 and the authority of the High Court of Malaya.

8. Doctrine of Renvoi

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 8.1. The appellant also pointed out that it was important to note that the doctrine of
renvoi, which normally has very limited application in private international law,
nevertheless does apply in relation to questions of title or succession to
immovable property located in another country. Under the doctrine, the court
would look at the private international law of the country where the immovable
property is situated and apply the law the other country would apply. The
rationale for this doctrine is that it was important to decide a case just as it
would be decided under the lex situs because any inconsistent judgment would
be of questionable validity. TUnfortunately, the Court of Appeal of the
Supreme Court of Western Australia made no reference to or mention of the
doctrine of renvoi that obviously needed to be considered.

Judgments regarding immovable property located in a foreign jurisdiction, as foreign

judgments, have no validity and they are non est so far as the area outside the jurisdiction
of the adjudicating court is concerned, if they do not conform to the principles of private
international law. Such judgments are an absolute nullity in the international sense.

In making the ruling, the Court of Appeal of the Supreme Court of Western Australia did
not consider at all the provisions of the National Land Code 1965 and the numerous
Malaysian cases that have ruled on the relevant provisions of the Code. The ruling of the
Court of Appeal of the Supreme Court of Western Australia that it can decree a transfer
of the property and it can bypass the provisions of the National Land Code 1965 is
audacious and an affront to the sovereignty of Malaysian law, against the comity of
nations and does not comply with established private international law principles.

* For a full discussion of this topic see: Khaira, Hardial Singh, Enforcement of Foreign
Judgments over Immovable Property in Malaysia [2007] 1 QLR 34.