The case of HCL v PTL & Anor [2026] 8 CLJ 675 established a legal precedent regarding the current unenforceability of nuptial agreements in Malaysia. The decision is significant for its interpretation of Section 56 of the Law Reform (Marriage and Divorce) Act 1976 (“LRMDA 1976”), which contemplates the making of rules of court to enable parties to refer matrimonial agreements to the Court.
 
Facts
 
The Appellant Wife (“Appellant”) and the 1^st Respondent Husband (“1^st Respondent”) married on 12 July 1997 and had five children together, in addition to the Appellant’s daughter from a previous marriage. Less than a month after the marriage, they entered into a post-nuptial agreement on 9 August 1997 (“Agreement”). Notably, the Agreement provided for spousal and child maintenance and contained a clause allowing the 1^st Respondent to maintain at least one mistress during the marriage. Following the irretrievable breakdown of the marriage, and on grounds that included an allegation of the 1^st Respondent’s adultery with the 2^nd Respondent, the Appellant commenced divorce proceedings in January 2021.
 
The High Court dissolved the marriage and held that the Agreement was valid and binding. Both sides appealed.¹
 
Decision of the Court of Appeal
 
The Court of Appeal found that the High Court’s decision was generally not plainly wrong, save in respect of three matters: 

Issue 1: Whether the post-nuptial Agreement was valid and enforceable
 
Section 56 of the LRMDA 1976 provides that rules of court may be made to allow any party to a marriage to refer any agreement relating to, arising from or connected with proceedings for divorce which are contemplated or have commenced, to the court for a review of their reasonableness, and for the issuance of an appropriate direction on the enforceability and the effect of the agreement. However, the Court observed that neither the Divorce and Matrimonial Proceedings Rules 1980 nor the present Rules of Court 2012 contain provisions regulating agreements contemplated under Section 56 of the LRMDA 1976.
 
The Court of Appeal held that the legislative intention underlying Section 56 of the LRMDA 1976 could not be fully implemented until the necessary rules were promulgated. A complete procedural mechanism is needed for the Court to properly scrutinise, evaluate or endorse such agreements.
 
The Court of Appeal held that the word “may” in Section 56 of the LRMDA 1976 has a permissive or mandatory effect. It relied on the observations of Lee Swee Seng J (now FCJ) in Maya Maju (M) Sdn Bhd v Putrajaya Homes Sdn Bhd [2018] CLJU 1245, where His Lordship explained that although "may" is generally permissive, it can become mandatory when the option is exercised.
 
As such, the Court concluded that until rules are enacted pursuant to Section 56 of the LRMDA 1976, pre-nuptial and post-nuptial agreements ought not to be regarded as valid, admissible and enforceable for matrimonial proceedings under the LRMDA 1976.
 
Notably, the Court of Appeal’s finding on the invalidity of the Agreement did not disturb the decree of divorce issued by the High Court. The trial judge’s independent finding that the marriage had broken down irretrievably due to irreconcilable differences was sufficient, on its own, to sustain the divorce order.
 
Issue 2: Whether the Appellant was entitled to 25% or 20% of the shares in the companies owned by the 1^st Respondent
 
The second issue concerned the percentage of the Appellant’s entitlement to shares in companies owned by the 1^st Respondent. The High Court had initially pronounced orally that the Appellant was entitled to 25% of the shares but subsequently recorded her entitlement as 20% in the final order without explanation.
 
The Court of Appeal held that this was a mistake which ought to be rectified.
 
Issue 3: Whether the Appellant was entitled to a share in the companies acquired by the 1^st Respondent before the marriage
 
The third issue arose from the 1^st Respondent’s cross-appeal concerning shares in two companies. The High Court had ordered that 25% of the shares in these companies be transferred to the Appellant. However, the Court of Appeal found that the companies had been acquired by the 1^st Respondent before the marriage.
 
The Court referred to Section 76(5) of the LRMDA 1976, which treats premarital assets as matrimonial assets where they have been substantially improved during the marriage by the other spouse or through joint efforts. As the statutory requirement was not satisfied, the High Court’s order transferring 25% of those shares to the Appellant was erroneous.
 
The Court of Appeal allowed the appeal in part and allowed the cross-appeal, varying the High Court’s decision to reflect its decision on Issues 2 and 3 above.
 
Comments
 
The Court of Appeal’s decision, subject to an appeal to the Federal Court, if any, clarifies the current legal position in Malaysia on nuptial agreements.
 
While the earlier High Court decision in Lim Thian Kiat v Teresa Haesook Lim Nee Teresa Haesook [1997] 5 CLJ 358 upheld a post-nuptial deed because it was entered into voluntarily and with legal advice, this recent Court of Appeal ruling significantly shifts the legal focus. It moves away from whether a matrimonial agreement is voluntarily entered into, fair or reasonable on its facts and instead identifies a fundamental procedural barrier, i.e. the absence of statutory procedural rules to facilitate the consideration and recognition of such agreements.
 
Certain quarters in Malaysian society may point out that certain foreign jurisdictions, such as England, recognise nuptial agreements², and Singapore gives weight to nuptial agreements³, and argue that recognising nuptial agreements respects autonomy and provides financial certainty that can protect marital stability. However, unless and until the procedural hurdles outlined by the Court of Appeal in this case are overcome, the legal position in Malaysia is that nuptial agreements are generally unenforceable for the purposes of divorce proceedings.
 
As Section 56 of the LRMDA 1976 applies to agreements which relate to, arise from or are connected with proceedings for divorce which are contemplated or have commenced, an interesting question which the Court of Appeal was not required to address in this case is whether a nuptial agreement entered into voluntarily by the parties would be enforceable when the agreement is entered into voluntarily without any intention to divorce in the first place. Significantly, Section 56 is worded from the perspective of the parties who are allowed to refer any nuptial agreement to the Family Court for review or the issuance of an appropriate direction on the enforceability and the effect of the agreement. However, it arguably does not expressly negative any of the High Court’s statutory powers or powers under its inherent jurisdiction.
 
Further, Section 47 of the LRMDA 1976 permits the Family Court in Malaysia to apply the principles of law which are conformable to the principles of the High Court of Justice in England. In respect of the phrase “conformable to the principles on which the High Court of Justice in England”, the High Court case of Ananda Dharmalingam v Chantella Honeybee Sargon [2006] 6 MLJ 179 explains that Section 47 of the LRMDA 1976 provides for the importation of English principles when the Family Court decides matrimonial cases in Malaysia⁴. This, coupled with its inherent jurisdiction, may arguably be the basis for our Family Court to review and if necessary enforce a nuptial agreement entered into voluntarily by the parties. Indeed, Section 56 of the LRMDA 1976 arguably does not and cannot provide a basis for excluding English matrimonial law principles. However, in view of the Court of Appeal’s decision in this case, it is unlikely that this view would find acceptance by the Malaysian Courts. 
 
 
Case Note by Trevor Jason Mark Padasian (Partner) and Isabelle Chip Oi-Yi (Associate) of the Family Law Practice of Skrine.
 
 

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