This article first appeared in The Edge Malaysia Weekly on December 29, 2025 - January 4, 2026

GIVEN the Federal Court’s dismissal of Semantan Estate (1952) Sdn Bhd’s appeal for leave to secure transfer of the Duta enclave land titles in what is regarded as the biggest pre-Merdeka — and arguably post-Merdeka — property dispute, what lies ahead for the parties?

The dismissal of the appeal means that the government gets to keep the land and the titles despite an earlier lower court decision in 2009 that the acquisition was considered illegal as the government was deemed to have trespassed on the land.

Essentially the apex court was of the view that the lawsuit, filed to compel the government to return and register the land to the company, was not enforceable due to provisions in the Government Proceedings Act and Specific Relief Act, which state that proceedings related to a return of land cannot be effected against the government and that the party is only entitled to compensation.

The latest decision was made, notwithstanding that the 2009 High Court decision was upheld by the Court of Appeal and Federal Court in 2012. Moreover, the government had failed in a 2019 review application of the court’s decision that the acquisition was illegal and that the government had trespassed on the land.

Semantan Estate employed three modes, namely a mandamus order to ask the court to physically return the land, an action under the National Land Code to reregister the 38 land titles that had been subdivided back to Semantan, and finally the mesne profit calculation.

The first two modes — the bid for physical return of the land and government buildings, together with the land title — failed all the way to the Federal Court last month. What remains is a temporary reprieve: compensation for the allegedly illegal land acquisition, to be assessed by the High Court at the 1956 rate.

The then government had only paid RM1.32 million in 1956 for the whole tract of land. The calculation and compensation for the illegal acquisition will now be determined by High Court judge Roslan Mat Noor.

In August last year, the High Court had ordered the 38 land titles to be registered back to Semantan, only for its decision to be overturned by the Court of Appeal in July and upheld in November by the Federal Court.

Immediately after the Federal Court’s decision on Nov 13, liquidator Dr Jim Lai Chee Chuen for Semantan Estate indicated that his client is considering a review of the apex court’s decision and that this decision would be made after consulting with the shareholders of the company.

A review of the apex court’s decision could be done under Rule 137 of the Federal Court Rules that the apex court has the inherent powers to allow a review of its own decision made by an earlier bench to prevent injustice and abuse of the court process.

The key word is to prevent injustice and this is what the company lawyers would be arguing over why the previous bench was wrong in not considering the 26 questions posed before the court.

The transfer of the land titles is distinct from the ongoing mesne profit proceedings, where the High Court will determine damages for the government’s occupation of the land until the acquisition is ruled legal.

The case had been ongoing before Judge Datuk Ahmad Shahrir Mohd Salleh in Kuala Lumpur but as he was recently transferred to the Seremban High Court, the ongoing proceedings will now continue there with submissions for the mesne profit sum fixed for Jan 16, 2026.

Mesne profit is the rental loss that could have been obtained by Semantan Estate for the property if it had continued to own the land.

CBRE | WTW’s advisor, Foo Gee Jen estimated the value of total profit in the range of RM3 billion to RM12 billion for the period 1956 to 2021. This large estimate is based on amounts that do not include interest, with simple interest and compound interest.

On the other hand, government valuers from the Valuation and Property Services Department from the Ministry of Finance disputed Foo’s findings and listed mesne profit at a mere RM290 million.

Given such contrasting figures, Ahmad Shahrir may have to call for other expert opinions before deciding on the actual value for damages for mesne profit — a decision he may make early next year.

As such, two major decisions are expected next year: namely the calculation for compensation to be decided by Judge Roslan Mat Nor, based on the 1956 acquisition as directed by the Court of Appeal and upheld by the Federal Court in November.

And, a decision on the long-standing issue of mesne profit to be decided by Ahmad Shahrir.

Whatever the outcome, each separate finding could be subject to an appeal to the Court of Appeal and Federal Court.

This does not include Semantan Estate’s expected filing of a judicial review of the apex court’s November decision to dismiss its appeal to have the land and titles returned.

It remains to be seen whether the long-standing 70-year dispute over the large tract of prime land can be resolved by next year or whether it may take several more years.

“It would be ‘horrendous’ if an order were issued to return the land to Semantan Estate after nearly 70 years. The government took possession of the plot in December 1956, when the area consisted only of old rubber trees,” said Lee Swee Seng, who is now a Federal Court judge, in delivering the Court of Appeal’s ruling in June 2025, noting the area is now a fully developed township.

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