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2024 MarsdenLR 218
HIGH COURT MALAYA PULAU PINANG
ANAND PONNUDURAI, J
UNITED PLUMBING AND SANITATION SDN BHD – Appellant
Versus
TAMAN RATU SDN BHD & ANOTHER CASE – Respondent
[Civil Suit Nos: PA-22NCVC-8-01/2022 & PA-22NCVC-9-01/2022]
Specific performance cannot be ordered if it contravenes the law, as established by the Court of Appeal, which overruled prior decisions allowing for such remedies.
Headnote:(A) Specific Relief Act 1950 - Section 18 - Housing Development (Control and Licensing) Regulations 1989 - Specific performance of Sale and Purchase Agreements (SPAs) sought by Plaintiffs for properties not delivered due to landslide - Court of Appeal reversed prior findings, establishing that specific performance cannot be ordered if it contravenes the law. (Paras 12-14, 78-82)
(B) Force Majeure - The Defendant argued that a landslide constituted a force majeure preventing delivery of vacant possession - Court found that the Defendant did not abandon the project and took necessary steps to mitigate the damage. (Paras 29-30, 76)
Facts of the case:
The Plaintiffs purchased properties under SPAs but did not receive vacant possession as agreed due to a landslide in 2017. The Defendant claimed the landslide prevented delivery. (Paras 1-4)
Findings of Court:
The court ruled that the Plaintiffs were not entitled to specific performance or damages in lieu thereof, as the Court of Appeal had overturned the previous ruling which had allowed such claims. (Paras 85-89)
Issues: The main issues were whether the Plaintiffs were entitled to specific performance or damages due to the Defendant's failure to deliver vacant possession. (Paras 58-62)
Ratio Decidendi: The court determined that specific performance could not be ordered if it would contravene the law, following the Court of Appeal's recent ruling. (Paras 78-82)
Result: Claims dismissed with costs awarded to the Defendant.
Introduction
[1] These two claims are by two separate individual purchasers who purchased houses from the same developer Defendant via different Sale and Purchase Agreements (hereinafter referred to as "SPAs") executed on different dates.
[2] As the Plaintiffs were represented by the same set of solicitors and the Defendants are the same and represented by the same set of solicitors, Suit No. PA-22NCVC-9-01/2022 (hereinafter referred to as "Suit No 9") was transferred to be heard together with Suit No PA-22NCVC-8-01/2022 (hereinafter referred to as "Suit No 8"). There is no dispute that pursuant to the SPAs, the Plaintiffs were supposed to receive vacant possession in 2014 and 2016 respectively but the Defendant had failed to do so as per the agreements. However, the main defence of the Defendant is that a landslide had occurred on 5 November 2017 and this has prevented them from delivering the said properties to the Plaintiffs to date.
[3] The Plaintiffs' claims are essentially for specific performance of the SPAs or alternatively damages in lieu of specific performance. The Plaintiffs have also sought a declaration that they are entitled to Liquidated Ascertained Damages (hereinafter referred to as "LAD") and consequently sought various sums as per their calculations and also sought general damages.
[4] However, the Plaintiffs have subsequently withdrawn their prayers for LAD and general damages. In fact, the Plaintiffs have at para 12 of their written submissions agreed that the main issue in this case is whether or not the Plaintiffs are entitled to specific performance of the SPAs or alternatively damages in lieu of specific performance.
[5] This decision to some extent has been delayed by proceedings in a similar case which was decided earlier in a claim brought by a different Plaintiff against the same Defendant herein namely Albert Lim Kok Heng & Anor v. Taman Ratu Sdn Bhd in Suit No PA-22NCVC-161-07/2019 (hereinafter referred to as "Suit No 161").
[6] In that case, there was no trial but a decision rendered by Goerge Varughese JC on 28 October 2021 pursuant to O 33 Rules of 2012. In that case, upon considering the facts which were almost identical to the ones at hand and also relate to the same terms and conditions under Schedule G of Subregulation 11 (1) of the Housing Development (Control and Licensing) Regulation 1989 and considering the case law and the applicability of s 18 of Specific Relief Act 1950 , His Lordship essentially made the following observations and findings in that case:
a. The obligations of the Defendant in the SPAs to deliver vacant possession within 24 months was clear;
b. At para 37, he found that it was not a case of the Defendant refusing to perform the contract but were prevented to do so by the landslide and mitigation works underway;
c. At paras 38 and 39, he then concludes that an Order for specific performance would contravene the law;
d. He however proceeds to Order damages in lieu of specific performance.
[7] There is no disputing that the Plaintiffs herein commenced these proceedings in 2022 placing heavy reliance on the above decision of Albert Lim (supra) in Suit No 161 with the same set of Counsel here.
[8] The Defendant maintained their defence and was of the view that the decision of George Varughese JC was erroneous and which was pending appeal. Notwithstanding such appeal, a trial was conducted in January 2023 for both Suits with each party calling two witnesses.
[9] During trial, the professional engineer, Mr Srinivasan testified as SD2 whereby it was clear that the Defendant have proceeded with mitigation works which encompass four stages with the 1st and 2nd stages being completed and having applied for stages 3 and 4 in October 2023, they were still waiting for approval.
[10] Upon conclusion of trial, I allowed a further document to be added with the consent of the parties which revealed that the MBPP have approved the commencement of the earth works for stage
