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2022 MarsdenLR 1363
HIGH COURT MALAYA KUALA LUMPUR
EKOVEST CAPITAL SDN BHD – Appellant
Versus
CHOO TEIK SHIONG & ORS – Respondent
[Civil Suit No: WA-12ANCvC-340-11/2021]
The court reaffirmed that extensions of time granted outside statutory limits are ultra vires under the HDA, significantly impacting buyers' rights to claim liquidated damages.
Headnote:(A) Housing Development (Control and Licensing) Act 1966 – Liquidated damages – Sale and Purchase agreements – Extensions of time – Court analyzed the validity of extensions granted beyond statutory periods as ultra vires the HDA, referencing its previous decision in Ang Ming Lee – Issue of effective time-bar raised concerning parties' claims. (Paras 6, 17, 20, 24)
(B)
Natural justice – Right to be heard – Court addressed whether purchasers must be notified of developers' applications for extensions of time, confirming that fairness demands consideration of buyers' interests in decision-making by the Minister. (Paras 62-66)
(C)
Estoppel and unjust enrichment – The court examined if buyers can be estopped from claiming liquidated damages due to prior agreements made under challenged SPAs, weighing doctrine against statutory intent to protect buyers. (Paras 77-82)
(D)
Final decision – Appeal allowed as there exist triable issues regarding the applicability of payment settlements and additional liquidated damages claims. (Para 98)
Introduction
[1] This appeal is one of the many cases filed by apartment and condominium buyers against developers as a result of the Federal Court's landmark decision dated 26 November 2019 in Ang Ming Lee & Ors v. Menteri Kesejahteraan Bandar, Perumahaan dan Kerajaan Tempatan & Anor and Other Appeals, ["Ang Ming Lee"].
[2] The Appellant is the Defendant in the Sessions Court below. The Respondents are the Plaintiffs. Parties will be referred to as they were cited in the Sessions Court.
[3] The Plaintiffs are purchasers of apartments built and sold by the Defendant. The Sale and Purchase agreements ["SPAs"] all stipulated delivery of vacant possession within 48 months from the date of the SPAs failing which the Defendant has to pay liquidated damages. The SPAs also stated that the Defendant was required to complete the common facilities within 48 months from the date of the SPAs failing which the Defendant also has to pay liquidated damages.
[4] The prescribed statutory period of 36 months for completion pursuant to the prescribed form under Schedule H of the Housing Development (Control and Licensing) Regulations 1989 ["Regulations"] had earlier, prior to the SPAs, been extended to 48 months by the Controller of Housing ["Controller"] pursuant to an application by the Defendant.
[5] Vacant possession was delivered to the Plaintiffs after the said 48 months on 16 May 2019. The common facilities were also completed after the said 48 months on 18 December 2018. By three written agreements all dated 16 May 2019 in respect of the late delivery of vacant possession; and three written agreements all dated 27 June 2019 in respect of the late completion of the common facilities the Defendant had paid agreed compensation to the Plaintiffs. For all intents and purposes, the Defendant thought all liquidated damages due to the Plaintiffs here have all been paid and settled.
[6] However, about one year and 9 months later, on 18 March 2021 to be precise, relying on the decision in Ang Ming Lee the Plaintiffs now filed a suit against the Defendant alleging that the Defendant was also liable to pay additional liquidated damages as the Defendant was obliged to deliver vacant possession and also to complete the common facilities within 36 months and not 48 months as granted by the Controller of Housing.
[7] It is pertinent to note the SPAs were signed after the extension to 48 months was granted by the Controller.
[8] The Plaintiffs had filed for O 14 judgment for liquidated damages for the extended 12 months which was allowed by the Sessions Court. The Defendant appealed to me. I allowed the appeal on 14 April 2022. The Plaintiffs have now filed an appeal to the Court of Appeal.
[9] These are my Grounds of Judgment. In my grounds I will review all the significant recent judgments on cases filed by buyers and the legal defences now raised by developers post- Ang Ming Lee.
Background Facts
[10] The six Plaintiffs here are purchasers of apartments in a project known as Ekocheras Service Apartment built and sold by the Defendant. The Sale and Purchase agreement with the 1st Plaintiff is dated 10 April 2014. The Sale and Purchase agreement with the 2nd Plaintiff is dated 31 December 2013. The Sale and Purchase agreement with the 3rd Plaintiff is dated 31 December 2013. The Sale and Purchase agreement with the 4th to 6th Plaintiffs as joint buyers is dated 25 April 2014. ["SPAs"].
[11] The terms of the SPAs are the same. A significant change in the terms of the SPAs is the statutory period for completion of 36 months pursuant to the prescribed form under Schedule H of the Regulations. This has been extended to 48 months by the Controller pursuant to an application by the Defendant on 18 October 2013, before the SPAs here were entered into.
[12] Under cl 25 of the SPAs the Defendant was required to deliver vacant possession within 48 months from the date of the SPAs failing which the Defendant has to pay liquidated damages to the Plaint
