Amm A/L Joy (Suing As Chairman Committee Of Members Of Wat Boomyaram) v Chuan Seng Sdn Bhd [2018] 5 MLJ 255

AMM A/L JOY (SUING AS CHAIRMAN COMMITTEE OF MEMBERS OF WAT BOONYARAM) v CHUAN SENG SDN BHD

Court of Appeal (Putrajaya)

Trespass to Land

Facts

1.    Two pieces of property, Lots 2813 and 76, are involved in the case (hereinafter referred       to as the Land)

2.    The Appellant is the registered owner of Lot 76, while the Respondent, who was the plaintiff in the proceedings before the High Court, is the owner of Lot 2813, Mukim AH, Daerah Kubang Pasu, Kedah. In the centre of Lot 2813 is the Appellant’s lot. Both plots share a common border.

3.    The Land was jointly owned by the Appellant and the Respondent.

4.    The Respondent’s property covered a total size of 3.8251 hectares.

5.    The Appellant used Lot 76 as a place of worship known as “Wat Boonyaram,” and he or she constructed a number of structures there, including a columbarium, a crematorium, a library, restrooms, and hostels. Yet these structures encroached into Respondent’s Lot 2813.

6.    The Appellant was successfully sued for trespass by the Respondent. On appeal, the High Court’s decision to award trespass damages was upheld, and permission to appeal to the Federal Court was denied.

7.    The Appellant then appointed a licensed land surveyor to conduct a survey on the Land and discovered that there is a retention pond on the Land and other permanent structures, measuring 9.554 acres of the Land.

8.    The senior assistant registrar (the “SAR”) was mandated to determine the amount of damages due after the High Court granted the Respondent’s trespass suit against the Appellant.

9.    Reports on valuation were submitted by both parties for the assessment process.

10.  According to the Respondent’s submission, the market rental value of its entire parcel of land was RM8,200.00 per month. The amount of RM782,200.00, or RM8,200.00 times 96 months, was claimed as its loss.

11.  On the other hand, the market rental value of the Respondent’s land was estimated at RM2,000 per month in the Appellant’s valuation report.

12.  In any event, the Appellant contended that even if the Respondent’s assessment is utilized, the total damages should be only RM57,623.04 based on the real area trespassed.

13.  The SAR then accepted the Respondent’s valuation and granted damages of RM782,200.00 for the Respondent’s loss of rental income for the entire 96-month period.  Accordingly, the learned judge upheld the same in the appeal.

14.  The learned court then ruled that the SAR had the right to choose one valuation assessment over another “so long as the report was sufficiently acceptable given the facts of the case”.

15.  The learned judge also read the valuation report and assessed that the market value of RM8,200.00 per month was “fair” and that there is “no basis to vary from the judgement made by the SAR since comparisons had been made with another six nearby houses. The learned court remarked that the sum was ‘fair considering the surrounding circumstances of this case’.

16.  The surrounding circumstances are as follows;

(a) that the Appellant had not acted in a timely manner to remove the infrastructures following receipt of a demand from the Respondent;

(b) that the infrastructures built by the Appellant could not be easily removed; removal of the columbarium and crematorium “would be very difficult and it could possibly spark public outcry; and

(c) that there was evidence elicited during the trial that the Appellant had obtained undue financial advantage.

Issue Whether the learned SAR is entitled to choose one valuation report over the other in assessing damages for trespass of land.
Ratios

1.    The legal principles in allocating damage

(a) While the learned judge may have begun well in defining the proper legal principles, the Court of Appeal found that the learned judge erred in its application and in his use of the appellate power.

(b) It was incorrect because when figuring up how much the trespassed land is worth as a rental, the actual proof of ‘loss of rental’ or a reasonable estimation of such a ‘rental return’ is taken into account.

(c)  Not only were the issues raised by the learned judge is unrelated to the respondent’s allegations, but the court had no intention of imposing any punitive or exemplary damages.

(d) The court then made reliance to the Court of Appeal’s decision in Othman Bin Ali & 290 Ors v Bukit Lenang Development Sdn Bhd [2016] 3 MLJ 708; at para [31] where;

“It was undeniable that in a normal case where once a trespass to land or a deprivation of use of land had been established, the normal measure of damages to be applied would be the actual proof of ‘loss of rental’ or a reasonable estimation of such a ‘rental return’ that was directly attributable and flowing from a lawful use of the land but denied by that wrongful action. This was consistent with the two underlying principles in law which required that any damage awarded would, so far as money can, put the affected or deprived party in the same position as he would have been if the tort had not occurred subject to the further overriding consideration that such damages to be awarded was in any event not too remote or speculative in nature.”

[Emphasis is added]

(e)  The court held that it is possible to draw the conclusion that actual proof of loss is still necessary even though damages for trespass are granted.

(f)   As the illegal occupation has adversely affected the intention or capacity to lend or lease out the subject land, that usually takes the form of rental. As for that, damages would be based on ‘a fair calculation of such a ‘rental return’.

(g) In either scenario, the loss must also be directly related to and resulting from the loss of a permitted use of the property absent the trespass or illegal occupation.

(h)  This indicates that the damages that will be granted shouldn’t be too speculative or far off.

(i)    Furthermore, it is sufficient for the Court to conclude that the user principle is in effect and that the Appellant is obligated to pay damages for the use that it has made improperly of the Respondent’s property.

(j)    As such, the Court that it would be the price of using the land.

(k)  What that cost will be depends on the evidence. While the Respondent may be entitled to damages ‘without bringing evidence that he could or would have let the property to someone else in the absence of the trespassing defendant’, the Respondent is not necessarily entitled to ‘have as damages for the trespass the value of the property as it would fairly be calculated’.

(l)      The court also made reliance in the words of Nicholls LJ in Stoke-on-Trent City Council v W & J Wass Ltd [1988] 3 All ER 394 where –

“It is an established principle concerning the assessment of damages that a person who has wrongfully used another’s property without causing the latter any pecuniary loss may still be liable to that other for more than nominal damages. In general, he is liable to pay, as damages, a reasonable sum for the wrongful use he has made of the other’s property”

(m)  The court then concluded that even though the appellant must pay “a reasonable sum for the improper use he has made of the other’s property, the responsibility of proving what that reasonable amount should be always rests with the Respondent, who must present information on any unusual circumstances in the specific case in order to decide the amount of damages.

(n)  It would be pure supposition or guessing on the part of the court to determine what the “reasonable rent” or “fair rent” is to be in any specific circumstance if no evidence were presented to the court.

(o)  The Respondent however is still required to present evidence to substantiate damages and establish the appropriate fair rent.

(p) The court found further found that according to the user principle, the Respondent’s loss is based on the circumstances equates to a rental fee or cost associated with the Appellant’s use of its land. In addition to the affidavits submitted, valuation reports were created by both parties to address the estimation and calculation of damages for loss of use.

(q) Nevertheless, the lower court did not appear to have examined either of the two valuation reports, other than to say that the SAR was free to select one over the other.

(r)   Unfortunately, such approach incorrect. It is not a personal preference issue.

(s)   According to sound judicial standards, there must be an examination and justifications for acceptance, denial, or preference.

(t)   If there is none, the learned judge sitting in appeal must review the facts and come to a well-thought-out conclusion.

(u)  If the learned judge had gone through the same process as in the appeal, the learned judge would have discovered relevant evidence concerning the features of the land and its surroundings that have a determining impact on the fair value of rental.

(v)  The court also believe that it is necessary to look into the respondent’s actions in the case.

(w) As a matter of fact, the court would have considered acquiescence important to the assessment of the reasonable rental price for the land.

Decision

1.    The Court of Appeal unanimously allowed the appeal, as the learned judge who was hearing the appeal from the SAR’s ruling clearly abused his or her discretion.

2.    The learned judge had made a mistake by failing to assess and take into account whether any loss was actually demonstrated.

Key Take Away

1.     There are two forms of trespass to land –

(a) The trespasser is there physically, either person A must physically be on person B’s property without person B being aware of it, or person B is aware of person A’s existence but objects to person A’s presence on his property.

(b) The second type of trespass does not require that person A to be physically present on person B’s property; rather, it just requires that person A interferes with how person B uses his own land or denied him the right to use it as he sees fit.

2.    A claim against a person who has been occupying land without the rightful owner’s consent might be made on two different grounds. Firstly, it is for the loss incurred as a result of the defendant’s trespass. Secondly, the assessment may be made based on the value of the benefit that the occupier may have gained. The plaintiff must decide either of the two grounds as both of it are mutually exclusive.

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