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Lia 4002 - Legal Drafting 1 SEM 1 2020/2021 Individual Assignment

Ms. Kamala Biden, head of South-East Asia for Make Malaysia Great, has approached your law firm for advice regarding a lease dispute. Ten years ago, MMG signed a lease with Tan Sri Sungai Emas to build a factory, with an agreement that MMG would own the factory at the end of the lease. However, the land was recently compulsorily acquired by the government due to Tan Sri's bankruptcy and proposed investment in the area. As the legal opinion, you will advise Ms. Biden that under property law, fixtures become part of the land, so ownership of the factory would transfer to the government despite the agreement. You will focus on relevant case law and principles of fixtures and le

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127 views2 pages

Lia 4002 - Legal Drafting 1 SEM 1 2020/2021 Individual Assignment

Ms. Kamala Biden, head of South-East Asia for Make Malaysia Great, has approached your law firm for advice regarding a lease dispute. Ten years ago, MMG signed a lease with Tan Sri Sungai Emas to build a factory, with an agreement that MMG would own the factory at the end of the lease. However, the land was recently compulsorily acquired by the government due to Tan Sri's bankruptcy and proposed investment in the area. As the legal opinion, you will advise Ms. Biden that under property law, fixtures become part of the land, so ownership of the factory would transfer to the government despite the agreement. You will focus on relevant case law and principles of fixtures and le

Uploaded by

Jenn Lee
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd

LIA 4002 - LEGAL DRAFTING 1

SEM 1 2020/2021
INDIVIDUAL ASSIGNMENT

LEGAL OPINION
15 marks

You are a partner in a prestigious law firm in Kuala Lumpur. Ms Kamala Biden, the head of
South-East Asia Division of renowned electrical manufacturer Make Malaysia Great (MMG) has
approached you for some advice in relation to a lease dispute.

Ten years ago her company signed a lease with local landowner Tan Sri Sungai Emas to build
and operate a local factory to design, manufacture and distribute their new line of consumer
products within the East and South-East Asian region.

The land was leased in Negeri Sembilan in an undeveloped land corridor, “Tanah Naik” suitable
for factory development.

As part of the leasing agreement, there was a clause stating in part that “despite any other law,
custom, presumption, equitable principle, statutory provision or otherwise, the ownership of the
factory shall devolve to the tenant at the conclusion, discharge or termination of the lease,
whether by effluxion of time, operation of law, frustration or agreement between the parties.”

At the end of the ten year lease MGM wrote to Tan Sri to exercise its leasing option to renew
the lease. However, unbeknownst to the manufacturer, Tan Sri Sungai Emas had become
bankrupt due to financial problems exacerbated by the covid-19 pandemic. As he was heavily
behind in his tax payments, the tax office effectively took over control of his lands.

Unfortunately for the tenant, the federal government in seizing the situation, saw this as an
opportune time to compulsorily acquire the land in order to take advantage of proposed Chinese
SOE investment in a new bridge and tollway project. It was likely that the announcement of this
project would be popular with the local electorate, which is economically disadvantaged.

The head wants to enforce their contractual right to retain ownership of the factory in order to
either block the new project and negotiate a new lease, or negotiate compensation (A11 Federal
Constitution).

However as a knowledgeable practitioner you are aware of property law principle that fixtures
remain part of the land despite any agreement otherwise and hence ownership of the factory
would result to the government as principal creditor of Tan Sri Emas. The law is clear that any
object that is fixed to the land by more than its own weight, and which is intended to remain
permanently there so long as it is being used is under ordinary principles of property law part of
the land. This will be the main focus of your advice to Ms Biden.
Write a formal legal opinion to Ms Biden/MMG by referring to the following (in order of
importance):

1. Shell Company of Federation of Malaya v Commissioner of Federal Capital of Kuala


Lumpur [1964] High Court 1 MLRH 643
2. General law on fixtures on land and leasing
3. Any other laws that you deem relevant such as compulsory acquisition or bankruptcy
legislation.

INSTRUCTIONS TO YOU:

● You may use your firm’s letterhead, however, please refrain from identifying yourself
(including in the form of signature).

(5 MARKS WILL BE DEDUCTED if you identify yourself anywhere in the


assignment. A number of students do this every year, don't be one of them.)

● MAXIMUM four (4) pages only (11 point font, single-spacing) including letterhead
and signature (cover sheet can be additional).

(MARKS WILL BE DEDUCTED if you go over this limit at a rate of five (5) marks for
any excess, with additional one (1) mark deducted for every 50 words over limit)

● COVER: MATRIC NO ONLY

● FORMAT: PDF

SUBMISSION TIME & DATE: 27 November @ 5pm.

Please submit on SPECTRUM AND MS TEAMS in the designated space.

❖ Contact Mr Simon/Ms Husna immediately (not more than 15 minutes after the
assignment is due) if you are not able to submit as per above.

❖ Failure to contact immediately will be deemed as non-submission and zero (0) marks will
be awarded.

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