(delivering the judgment of the Court): The plaintiff (respondent before us) wanted to buy a shophouse on lot 25602 1,680 sq. ft. in area in phase 5 in SEA Park, Petaling Jaya, from the defendant who is a licensed developer (appellant before us).

It is common ground that the transaction between the two is governed by the Housing Developers (Control) and Licensing) Act 1966 ("the Act") and the Housing Developers (Control and Licensing) Rules 1970 ("the rules") published as P.U.(A) 268/70.

On January 2, 1974 by a written agreement (AB1) the plaintiff agreed to buy from the defendant the shophouse at the price of $ 175,000. Under the agreement the defendant was to complete the said building within 18 months from the date of the agreement, i.e. on or before July 1, 1975. The plaintiff paid a deposit and paid the rest of the purchase price progressively. In fact the building was not completed until June 16, 1977. It is a term of the said agreement that the defendant should pay liquidated damages at the rate of 8% per annum on the purchase price for any delay in the completion of the said building up to the date of actual completion and delivery of possession.

The