LEASES AND TENANCIES (WHS said to focus on calculation of bill, he simply touch n go

the rest in lecture)

Lease
S. 5 NLC: Lease = registered lease/tenancy in excess of 3 years.
S. 221 (2) NLC: A proprietor of alienated land may grant leases for a term exceeding 3 years in
respect of the whole or any part of his land.
S. 221 (3) NLC: Where the lease relates to the whole piece of land e.g whole unit the maximum
duration is 99 years. Where a lease is only of a part of the land e.g. sublease one of the rooms in
a unit, the maximum duration is 30 years.
S. 221 (4) NLC: Instrument for lease = Form 15A, instrument for sublease = Form 15A + 15B.
S. 223 (1) NLC: Proprietor/lessee/sublessee/tenant/subtenant can grant tenancies of max 3 years
subject to S. 225 and 226.
S. 227 (1) NLC: Interest of lessee/sub lessee vests in him upon registration of lease/sublease.
Effect of non-registration of lease
Rights based on contractual rights in personam, but if later register your rights will be at rem
(against world). Means it’s merely equitable lease, cannot bind parties not privy to agreement.
Landlord
S. 206 (3): Void as lease but can be enforceable as agreement via equity.
Margaret Chua v Ho Swee Kiew & Ors [1961] 1 MLJ 173
Failure to register a 25 year agreement to lease rendered it an equitable lease. Lessee could sue
for specific performance to order the lessor to register the lease.
May be enforceable in equity, i.e. good and valid as an agreement for a lease.
Wan Salimah b Wan Jaafar v Mahmood b Omar [Lanim b Abdul Aziz – Intervener] [1998]
5MLJ 162
Defendant entered into a written agreement for a lease for 15 years of his share of the land to the
Plaintiff for 15 years. However the lease was not registered as D refused to sign the Form 15A.
Meanwhile D entered into a SPA with the Intervener. P applied to court for specific performance
that the D be ordered to execute the Form 15A. Court allowed application by way of equity.
Third party
S. 228 (2): Oral option not enforceable.
Hotel Ambassador S/B v Seapower S/B 1991 1 MLJ 404 (refer bottom)
Tan Kiaw v Gan Chye Koon [1983] 2 MLJ 109
An oral tenancy is not binding on the subsequent purchaser.
Ho Ying Chye v Teh Cheong Huat [1965] 2 MLJ 261
Effect on third party by unregistered lease is that it will not bind the future unregistered
proprietor. If the lease property is sold, the new registered proprietor will not be bound by the
unregistered lease.
Ong Heng Hwa Realty Sdn Bhd v Teoh Chai Siok [1977] 1 MLJ 124
A purchaser with notice that the vendor is not in possession of the land takes subject to the right
or interest of a tenant in possession notwithstanding the fact that the tenant may have entered
under an unregistered lease.
Siew Soon Wah v Yong Tong Hong [1973] 2 W.L.R. 713
Where a claim subsequent to the unregistered lease has been registered, the claimant will not be
adversely affected nor be bound by the agreement for the lease unless the claimant is a volunteer,
in which case, the agreement will be enforceable against him.
Can lessee lodge caveat? (not covered by WHS)
Inter-Continental Mining Co Sdn Bhd v Societe Des Etains De Bayas Tudjuh [1974] 1 MLJ
145
A caveatable interest is not necessarily confined to a registered interest under the National Land
Code. (lol under this logic tenant can lodge caveat too but cases below state that tenant cannot
lodge caveat)
Woo Yok Wan v Loo Pek Chee [1975] 1 MLJ 156.
The right of a lessee in these circumstances may be protected by the entry of a caveat pending
the trial of his action for specific relief or, to put it in slightly different parlance, the lessee has a
caveatable interest
POK KEW CHAI v YEOH THIAN SENG & ANOR [1975] 1 MLJ 220
Although the agreement with the applicant in this case was void as a lease it was valid as an
agreement for a lease and therefore the applicant was entitled to apply for the entry of a private
caveat under section 323(1)(a) of the National Land Code.
The applicant's interest was based on equity but as between the applicant and the first respondent
it was the first respondent's interest which should take precedence. (implies that even though
unregistered lessee can lodge caveat, you are not the priority, be careful hahahaha)
Tenancy (equals to tenancy not exempt from registration)
S. 213 (1) and 223 NLC: A proprietor of land or a lessor may grant a tenancy – i.e. a right to
occupy land for a term not exceeding 3 years.
S. 223 (1) NLC: Proprietor/lessee/sublessee/tenant/subtenant can grant tenancies of max 3 years
subject to S. 225 and 226.
S. 227 (1) NLC: Interest of tenant vests in him upon granting of the tenancy.
**If q is > 3 years and registered = lease. Q < 3 years, done orally/by written agreement =
tenancy.
Procedure for Endorsement of Tenancy
S. 316 (1) NLC: Application for endorsement can be made by any person/body claiming to be
entitled to the benefit of a tenancy.
S. 316 (2) (a) and (b) NLC: Application to be accompanied by a plan and description sufficient
to allow the tenancy part to be identified. If the property is subject to charge, charge must give
consent first because chargee has priority rights over everyone. Relevant documents could be
copy of tenancy.
S. 317 (1) (a) and (b) NLC: Upon receiving application under S. 316, registrar to note date and
time when it was received, and he has to make a note of this in Presentation Book. Registrar will
put a note on when does it become effective e.g. 15 Sept 4 p.m.
S. 317 (1) (c) NLC: Registrar to note that “exempt tenancy claimed”.
*** Its just like giving notice to third party that there is a tenant or tenancy under this title. Does
not give rights to claim or anything to third party.
S.317 (2) NLC: The Registrar shall not deal with any such application until he has finally
disposed of every instrument of dealing or like application presented or received prior thereto
and relating to the same register document of title.
S. 317 (3) NLC: Registrar has the right to reject if tenancy claim defeated by
transfer/sale/chargee’s consent x provided. For example, landlord has already sold property to
someone else, and landlord told new buyer I don’t want to continue the tenancy. If confirmed
that tenancy not continued, new buyer can reject because this application is done by tenant, or if
the tenant cannot product the chargee’s consent.
S. 317 (4) NLC: Rejection to be noted in Presentation Book.
S. 317 (5) NLC: Registrar will not enquire into validity of tenancy claim except as in (3).
S. 317 (6) NLC: Every endorsement made under S. 317 (1) (c) shall be signed and sealed.
Effect of tenancy that is not endorsed
Hotel Ambassador Sdn Bhd v Seapower Sdn Bhd [1991] 1 MLJ 404
No tenancy exempt from registration granted by the chargor after the date of registration of the
charge shall be binding on the purchaser, unless prior to the date of registration of the certificate
of sale, the tenancy had become protected by an endorsement on the register document of title
Than Kok Leong v Low Kim Hai 1983 1 MLJ 187
Oral tenancy, unregistered. D claimed that former landlord had an agreement with him for a
tenancy of 3 years.
Held that if the tenant fails to endorse, it will not bind any subsequent lessee, sub lessee, tenant,
charge or lien holder. Means that failure of tenant to endorse = tenant cannot claim that SPA
subject to tenancy, proprietor can sell without taking into consideration the rights of tenant.
Luggage Distributors Sdn Bhd v Tan Hor Teng [1995] 1 MLJ 719
Under S. 323 (1) (a) of NLC, a private caveat may be entered by any person or body who claims
either the title to land or any registrable interest in land. Tenancy x registrable so it x qualify as a
caveatable interest. Only protection for tenants is an endorsement.
HOWEVER, even if x endorse, but vendor reveal to new purchaser that got tenant for certain
years and new purchaser is willing to bound, the tenancy can be accepted e.g put in SPA that
vacant possession is subject to tenancy, or else purchaser will not be bound if he does not accept
it.
Characteristics of Lease
Exclusive possession, parties intention is to create lease, granted for a definite and ascertainable
peiod of time, registered under S. 221 (4) NLC., S. 234 to 240 NLC applies to leases and sub
leases.
Woo Yew Chee v Yong Yong Hoo [1979] 1 MLJ 131
The ultimate test of whether it is a lease/ license is the nature and quality of the occupancy.
Question is whether it is intended that the occupant should have an interest in the premises let or
it is a privilege personal to the occupant only. Respondent in this case was allowed to occupy
premises, provided that bathroom, kitchen etc was shared with the landlord who held the key.
Court held this was a lease.
Lease creates an interest in the land, but license x create interest= you just temporarily there, you
don’t have interest in it.
Breach entitles lessee to recover possession, its like a security. License is a personal privilege, so
if breach, just pay compensation.
Lease is right in rem= against whole world, license right is only personal.
Lease is exclusive possession of land, license is just that you can enter anytime, but anytime can
chase you out too.
Lease must be registered and in writing, license can oral. Because lease must register, cannot
oral.
Lease can be transferred/sublet/charged, but license cannot.
Restrictions on creation of lease
S. 225 (1) NLC: Creation of lease restricted by any prohibition by NLC e.g. the maximum
duration; restricted by any ROI; restricted by the provisions of the lease/sublease.
Above section applies to tenancies as well.
S. 226 NLC: Written consent of chargee is required if land subjected to charge.
KVS Maruguppa Chetty v Low Jow Dun 4 FMSLR 87
It was held that the chargee's consent to a lease was necessary and that as that consent had not
been obtained, the right of the chargee took priority over the rights of the lessee.
Express and implied provisions of lease
Express in Schedule 6: List types of land use e.g agricultural, residential etc.
S. 230 NLC: Implied provision = to pay rent on time in the manner specified.
S. 231 (1) (a) NLC: Pay rent, except rent due to SA and anything payable exclusively by lessor.
S. 231 (1) (b) NLC: Keep the property in good repair except the roof, main walls, drains and
common passages and installations.
S. 231 (1) (c) NLC: Permit the lessor or agent to enter and inspect the property
S. 231 (1) (d) NLC: Not to transfer/charge/sublet without consent of lessor. Lessor cannot
unreasonably withhold consent.
Determination of lease
S. 239 (2) NLC: Can terminate by way of surrender before expiry of lease via Form 15C and
registering Form 15C. Needs written consent of chargee.
Either party may have right to terminate the lease before expiry by serving on the other a valid
Notice to Quit.
S. 239 (5) NLC: The surrender of the lease will not affect any sub lease or tenancy.
S. 240 NLC: Auto terminates upon expiry of the term, may be cancelled by Registrar via S. 313.
In the case of a tenancy exempt from registration the endorsement made on the RDT may be
cancelled.
S. 235 NLC: Landlord can terminate if breach occurs e.g. never pay rent, simply sublet etc. If
purpose is for residential only, you cannot use one room for commercial etc. Lessee becomes
bankrupt also = breach.
Golden Court Hotel v Pemegang Harta Malaysia [1995] 4 MLJ 708
Landlord claimed it did not consent to lease, but it had already collected rent from the lease
hence the conduct = consent.
Lam Kee Ying Sdn Bhd v Lam Shes Tong & Anor [1974] 2 MLJ 83
Covenant was given whereby lessee was not to part with possession, lessee subletted it. Held that
lessee breached the convenant, landlord can terminate.
Effect of forfeiture of lease
S. 240 NLC: Effect of a forfeiture of the lease is to extinguish all interests dependant on the lease
including a charge, sub-lease and tenancy. Differs with SURRENDER OF LEASE!
S. 241 NLC: Lessee can appeal against the forfeiture, relief granted at discretion of court. Relief
granted will not extend beyond original period of the lease.
S. 234 (3) NLC: Any action of the lessor in accepting rent or doing any act evidencing an
intention to treat the lease as subsisting will constitute a waiver of the right to forfeit.
Saratogoa Sdn Bhd v Pentadbir Tanah Johor Bahru [J 01 310 07/2012]
Whether the respondent can forfeit the appellant’s land for non-payment of rent assessment when
at the material time of forfeiture the appellant has been wound-up under the Companies Act
1965?
Appeal allowed. The order of forfeiture revoked. Deposit to be refunded to the appellant. It is
well settled that every exercise of statutory power must be in conformity with the express words
of the statute, Sections 97, 100 and 130 of the NLC and with certain express and/or implied legal
requirements and in Section 226 (3) of the CA 1965 and must pass the acid test of
reasonableness.
At the time the SA forfeited the land, the company had already been wound up. Must answer
whether it is reasonable for you to forfeit land.
Tenancy coupled with equity
Occurs when no tenancy agreement but tenant takes possession due to expectation created by
landlord/landlord encourages tenant to expend money on the land. Landlord is estopped from
denying tenancy in such cases.
MPRL Karuppan Chetty v Suah Thian [1916] 1FMSLR 3000 and Devi v Francis [1969]
2MLJ 169.
Tenancy where the landlord has encouraged the tenant to spend his money to improve the land
eg. construction of building, with the expectation of being allowed to remain on the property
may give rise to equitable rights.
Devi v Francis [1969] 2 MLJ 169
It will appear that such an expectation or promise is also binding on a successor-intitle and a
purchaser with notice. Means that third party can be bound by this.
Holee Holdings (M) Sdn Bhd v Chai Him & Ors [1997] 4 MLJ 601
3 elements that must be proved in order to establish a proprietary estoppel = assurance, reliance,
detriment. Question is whether there was 'anything done or left to be done' by the legal owner
which encouraged a belief in the claimant that he would acquire an entitlement in the owner's
land, whether there was belief and reliance by the claimant, whether the claimant relied on the
assurance to his detriment.
Wee Tiang Yap v Chan Chan Brothers [1986] 1 MLJ 47
The estoppel of a tenant is founded upon the contract between him and his landlord. The estoppel
applies to a tenant holding over after a notice to quit. A tenant cannot deny his landlord’s title
however defective it may be unless he has surrendered his tenancy to his landlord.
No matter what happens, you cannot deny the landlord’s title to the land.
Calculations
Order 2 (b) SRO: In respect of tenancies or leases, agreements for tenancies or leases and
agreements reserving rent, the remuneration of the solicitor having the conduct of and
completing the transaction shall be in accordance with the Second Schedule.
Professional fees for tenancy
Second Schedule of SRO
First RM 10k 25%, min fee of RM 300
Next RM 90k 10%
Excess of RM 100k Subject to negotiation, but shall not exceed
10% of such excess.

Example:
RM 5k monthly rental, legal fee = RM 5k x 25% = RM 1250
Professional fees for leases (not covered by WHS)
Second Schedule of SRO
First RM 10k 50%, min fee of RM 600
Next RM 90k 20%
Excess of RM 100k Negotiable on the excess, but shall not exceed
20% of such excess.

Rules under Second Schedule (not covered by WHS)

Rule 1: A solicitor shall act only for the lessor/landlord or the lessee/tenant and the remuneration
of the solicitor shall be in accordance with the applicable scale fee in this Schedule. Means can
only act for one party, cannot act for both landlord and tenant.
Rule 2: Any consideration in the lease or tenancy agreement expressed to be payable other than
by way of rent (e.g. service charge, hire of furniture and fixtures) shall be deemed to be rent for
the purposes of this Schedule.
Rule 3: If there is varying rent, take the highest amount payable.
Rule 5: Where a solicitor represents the lessor or landlord in respect of leases or tenancies of ten
or more units in a building or part of a building in which a standard form of lease or tenancy
agreement is used, or where a lease or tenancy agreement is renewed upon substantially the same
terms and conditions, the remuneration of such solicitor in respect of each of such lease or
tenancy shall be 50% of the applicable scale fee in this Schedule, subject to a minimum fee of
RM600 for leases and RM300 for tenancies.
Same calculation format as the above example for tenancies.
Extra Calculations (he didn’t cover this shit, in case question have)
Fifth Schedule (witness tenancy agreement etc)
Item b: Witnessing execution of document: RM 50 for first copy, RM 10 for subsequent copy.
Applies if you witness execution of tenancy agreement not prepared by you etc.
Item f: Application for consent to lease to SA: RM 200 for consideration of RM 45k and below,
RM 300 for properties with consideration of RM 45k above.
Rule 1 of Fifth Schedule: Not witnessing fees for witnessing a document you prepared.
Sixth Schedule (advise on tenancy agreement not prepared by you)
Rule 1, Fifth Schedule: If client asks you to explain or advise on the contents of document not
prepared by you, you can be remunerated by rule 1 of Sixth Schedule.
Rule 1, Sixth Schedule: The remuneration of a solicitor in respect of non-contentious work for
which no provision is made by means of a scale or fixed fee shall be such sum as is fair and
reasonable having regard to all the circumstances of the case, and in particular the following
circumstances:
(a) the importance of the matter to the client;
(b) the skill, labour, specialised knowledge and responsibility involved on
the part of the solicitor;
(c) the complexity of the matter or the difficulty or novelty of the question
raised;
(d) where money or property is involved, the amount or value thereof;
(e) the time expended by the solicitor;
(f) the number and importance of the documents prepared or perused by
the solicitor;
(g) the place and the circumstances under which the services or business or any part thereof are
rendered or transacted.
Stamp duty
Item 49 (a) under Stamp Act, applies to both tenancies and leases.
Formula is (monthly rental x 12 minus 2400), divided by 250 x year of tenancy period. Round up
to nearest ringgit. Add another RM 10 for each additional copy of agreement.
If your yearly rental x exceed RM 2.4k, you are exempted from stamp duty. So, minus 2.4k
because this one don’t need pay stamp duty.
Example: rental of RM 2k, 2 years tenancy.
So 2k x 12 – 2.4k= 21600. Means that stamp duty payable 21.6k. Can choose to round up at this
point e.g. last 3 digits must be 000, 250, 500 or 750 because calculated on every subsequent 250.
For example, If 21350, round up to 21500.
So, round up to 21750 at this point then only divide by 250 also can. You will get the same
answer as below.
Every 250 paid in excess of the 2.4k pay RM 1.
So 21.6k/250= 86.40. Cannot pay sens. Can pay more but not pay less, so pay RM 87. This is
for one year tenancy. So for 2 years, 87 x 2 = RM 174.
Example: rental of RM 2.5k, 3 years.
2.5 x 12 – 2.4k = 27600
27600/250 = 110.4. Round off to 111
111 x 2 = 22
More than 1 year less than 3 years is x 2.
X 4 only applicable for lease agreement (because only leases will exceed 3 years).
The reasoning for the above formula is as below:

If question is 1 year fixed tenancy with 2 years option = only calculate for 1 year as the 2 years
are optional, so we don’t count this stamp duty yet.

Further note that:

***Even if document x stamped, Rule 58 of LPPER provides that it is contrary to etiquette to
object to the admissibility of any document on the ground that it is not or not sufficiently
stamped, unless such objection goes to the root of the subject matter or the suit.
***For provisions on evasion of stamp duty, refer to duty to be honest, Part 1, Chapter 1.
***S. 63 (1) (a) Stamp Act provides that any person who executes/signs any instrument that is
not duly stamped with the intention to evade payment of stamp duty is liable to be fined RM
1.5k.
***S. 63 (1) (b) Stamp Act provides that any person having drawn, made, executed or signed,
otherwise than as a witness, any instrument whatsoever chargeable with duty without the same
being duly stamped, fails, without lawful excuse, to procure the due stamping thereof within the
time within which such instrument may be stamped without penalty under this Act, shall be
liable to a fine of RM 1.5k. However, (4) provides that a lessor shall not be liable to such a
penalty. Means only lessee will be liable
***Stamp duty for surrender of lease is RM 10, Item 75 Stamp Act.