Malay Reservation Land = Malay Holding?

The concept of Malay Reservation Land was first introduced by the British in the Federated Malay States of Perak, Selangor, Negeri Sembilan, and Pahang in 1913 to prevent lands held by the Malays in those states from being disposed of to the non-Malays.
As land in Malaysia comes under the purview of the respective states and federal territories in Peninsular Malaysia, Sabah and Sarawak, different legislations relating to Malay Reservation apply to different states.
The recent case of Bebe Sakimah binti Mohd Asrof v Pendaftar Hakmilik Negeri Perak [2021] 7 MLJ 701 raised an interesting question of whether a non-Malay can be registered as the proprietor of Malay Reservation Land.
Facts of the Case
The Plaintiff was the successful bidder for a piece of land (“the Property”) at a Court ordered auction.
However, when she tried to register the Property under her name, the presentation was rejected by the Defendant, the Registrar of Land Titles of Perak, on two occasions. The first was by reason that the Plaintiff was unable to provide documents to prove that she or her parents were of Malay descent within the time period specified by the Defendant.
The Plaintiff’s appeal against the aforesaid rejection was also rejected by the Defendant on the ground that the Property was Malay Reservation land which could only be transferred to a Malay and the Plaintiff is not a Malay.
The Plaintiff then sought a Court Order that the Defendant register her as the proprietor of the Property.
General Rule
As the Property is situated in the State of Perak, the principal legislation applicable to the dispute was the Malay Reservation Enactment (FMS Cap 142) (“the MRE”).
From the outset it is clear that Section 8 of the MRE prohibits a Malay holding from being transferred, charged or otherwise disposed of to any person who is not a Malay, and prohibits any memorandum of transfer, charge or lease from being registered in contravention of that section in any Land Office or Land Registry. Further, Section 19 of the MRE provides that dealings contrary to the MRE is void.
The Plaintiff’s race was not a matter of contention as she had conceded that she is not a Malay.
The Plaintiff’s Submissions
The Plaintiff submitted that Malay Reservation land may be classified into two categories, namely “Malay holding” and “non-Malay holding” and that the prohibitions and restrictions against dealings in or disposals of Malay Reservation land in favour of a non-Malay only applies to a “Malay holding”. Although the Property is a Malay Reservation land, the Plaintiff further contended that it was not a “Malay holding” and could therefore be transferred to her even though she is not a Malay.
The Plaintiff cited Sections 8(ii) and 6(vi) of the MRE to show that there may be land included under Malay Reservation where a non-Malay could lawfully be a registered proprietor.
Section 8(ii) reads:
If any land included in a Malay Reservation is sub-divided and sub-divisional titles registered therefor and one or more of the proprietors of such land are Malays and one or more of the proprietors of such land are persons who are not Malays and there are simultaneously presented to the proper registering authority cross-transfers of such sub-divisional titles, such cross-transfers may notwithstanding anything contained in sub-section (i) be registered by such proper registering authority.
Section 6(vi) reads:
Notwithstanding anything hereinbefore in this section contained the proper registering authority shall not make any memorial under this section on the register or issue document of title for any land of which the sole proprietor is not a Malay or of which none of the co-proprietors are Malays.
The Defendant’s Submissions
The Defendant submitted that the Property had been gazetted as Malay Reservation on 25 May 1928 pursuant to the Malay Reservation Enactment 1913 (“the MRE 1913”), which is the predecessor legislation of the MRE. It produced a copy of the Gazette (“the 1928 Gazette Notification”) in support of this contention. The Defendant further submitted that under the MRE 1913, it is sufficient for a memorial to be made on the register document of title stating that the property is Malay Reservation.
It was also argued by the Defendant that it is sufficient for the words “Pengisytiharan Rezab Melayu” (Malay Reservation) to be endorsed on the issue document of title to the Property and there is no requirement for the words “Malay holding” to be endorsed thereon.
The Decision of the High Court
Based on the statutory provisions cited by the Plaintiff, as mentioned above, the learned Judicial Commissioner accepted the Plaintiff’s contention that not all Malay Reservation land is necessarily also a Malay holding.
The Court then considered the circumstances in which a Malay Reservation land is a “Malay holding” under the MRE.
According to the learned Judicial Commissioner, Sections 6(i) and 2(a) of the MRE provide a three step process for land declared under Malay Reservation (not being State land included within a Malay Reservation which is alienated and is deemed to be a Malay holding under Section 7 of the MRE) to be considered a Malay holding. The three steps are as follows:
(a)  first step - a publication is made in the gazette making notification of the alienated lands that are included in a Malay Reservation;
(b)  second step - the collector of the district in which such lands are situated shall then present to the proper registering authority a requisition in Form A in the First Schedule containing a list of all alienated lands included in and affected by such declaration to note in his registers of titles the fact of the inclusion of such lands in such Malay Reservation; and
(c)  third step - the proper registering authority shall then make a memorial upon every register of document of title included in the lands declared as Malay Reservation.
As regards the third step, the Court cited Zaleha bte Sabri v Pendaftar Hak Milik Johor [1996] 2 CLJ 14 as an example of the particulars that are to be memorialised on a document of title under Section 6(v) of the MRE, namely the date of the declaration and the gazetting of the inclusion of the scheduled land as Malay Reservation.
In view of the clear requirement in Section 2(a) of the MRE that no interest shall be deemed to be a Malay holding until the requisition in Form A in the First Schedule has been registered against the register document of title, it was imperative that evidence be furnished to the Court to prove that this requirement has been satisfied for the Property to be deemed a Malay holding.
The learned Judicial Commissioner, relying on Sections 101, 102, 103 and 106 of the Evidence Act 1950, held that when there is a challenge (as in the present case) as to whether the first and second steps have been complied with, the legal and evidential burden to prove that the Property is a Malay Reservation Land and a Malay holding lie with the Defendant.
After considering the 1928 Gazette Notification closely, the Court was not satisfied that the Property formed part of the lands listed in the 1928 Gazette Notification that had been declared to be Malay Reservation. Accordingly, the Court opined that the 1928 Gazette Notification did not prove that the Property is a Malay Reservation land and the Defendant’s reliance on this notification was misplaced. 
The Court noted that based on Sections 16(ii)(b) and 16(iii) of the MRE, a Malay holding subject to a sale by an encumbrancer, such as a chargee, falls within the ambit of Section 2(a) which requires the three step process to be complied with. As the Property was sold by the chargee, Bank Islam Malaysia Berhad, pursuant to a charge registered on 8 March 2003, the Judicial Commissioner was of the view that the declaration and gazetting must have been carried out after the MRE came into force on 15 December 1933.
The Defendant’s omission to produce evidence of Form A and its registration led the Court to conclude that the first and second steps had not been carried out to confer upon the Property the status of a Malay holding.
The Court therefore concluded that the Property was not a Malay holding and ordered the Defendant to register and issue a document of title in the Plaintiff’s name.    
It is clear that under the MRE, “Malay Reservation land” is not necessarily synonymous with “Malay holding”. Based on the decision in Bebe Sakimah, a non-Malay can be registered as a proprietor of Malay Reservation land which has been declared and gazetted as such under the MRE if the three step process set out in Section 6 has not been carried out to confer the status of “Malay holding” on the subject land. However, this decision must be accepted with caution as it is subject to the limitations set out below.
First, the decision is based on the provisions of the MRE which apply only to the State of Perak. As each state and territory in Malaysia has its own Malay Reservation enactment, the legal position in these states and territories may differ if the provisions in their respective Malay Reservation enactments differ substantially from those in the MRE.
Second, even in respect of the MRE, it must be noted that the three step process does not apply to alienated land included in a Malay Reservation which has been duly declared and gazetted under the provisions of the MRE 1913.  
Having said that, it is also clear from Bebe Sakimah that mere endorsement of the words “Pengisytiharan Rezab Melayu” on an issue document of title does not conclusively prove that the three step process under Section 6 of the MRE has been carried out so as to confer the status of a Malay holding on a property.
Case commentary by Oon Hooi Lin (Partner) of Real Estate Practice of Skrine.