High Court quashes Housing Ministry's decision

Kota Kinabalu: The High Court here quashed the Housing Controller's decision under the Ministry of Local Government and Housing to grant an extension of time (EOT) to a condominium project developer over a delay period of 180 days for the Light Residences, Thursday.The decision was similar to that in West Malaysia, this week where a court also sided with house buyers that EOT should not unfairly deprived buyers of their contractual rights to claim for liquidated assessed damages (LAD).

With this decision, it means that the legal principle now applies to Sabah as well unless overturned by a higher court.

In the Kuala Lumpur High Court case, High Court (Appellate and Special Powers) judge Hanipah Farikullah ruled that the Housing Controller has no power to grant an extension of time to developers who delay completion of housing projects.

This means a developer has to pay compensation to the affected buyers for delays in the delivery of vacant possession.

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Justice Hanipah held that the regulation which empowers the Controller to modify terms of the contract of sale was ultra vires the Housing Development, Control and Licensing Act.

The judge said this in allowing an application for judicial review by 71 buyers of the Sri Istana condominiums in Old Klang Road against the Housing Controller and Urban Well-being, Housing and Local Government Minister.

The developer has to pay the liquidated damages (a pre-determined sum) for late delivery of vacant possession of those condominium units.

The decision was a landmark judgment as many project developers seek extensions to complete their projects in Malaysia. With this ruling, the housing developer can't just go to the Housing Controller for an extension of time to complete the project in order to avoid paying the liquidated damages to house buyers.

Legal firm Lee & Kong counsel Datuk Kong Hong Ming represented the Sabah buyers while the State Attorney Chambers represented the Minister of Local Government and Housing, Sabah, and Goh & Associates represented the developer Ra Concept Development Sdn Bhd.

Kota Kinabalu High Court Justice Ravinthran N. Paramaguru awarded costs of RM15,000 to the buyers listed, among others as:

Chin Kah Weng, Tracy Hon Su Juin, Chiew Tze Ken, Helen Jong, Chan Chee Vui, Lee Chu Yun, Doreen Liau Pei Fui, Chan Han Wey, Liau Shene Yin, Hendry Chin Kui Hen, Tan Suk Hiang, Chong Lee Suan, Soo Tshun Kiong, Chong Shuang Hua, Yap Yann Shiow, Yap Chong Hong, Pang Kim Foo, Chu Pei Lan, Pang Kim Foo, Chu Pei Lan, Chong Chee Tin, Chin Chee Hen, Tsen Fui Tien, Pang Kim Fan, Chee Chaw Foh, Chin Hiong Fui, Liew Vai Heng, Liew Wing Fah @ Liew Kai Ming, Sabina Kinsik and Wong Khar Fei Alvin.

The ministry as the first defendant has to pay RM10,000 and the 2nd defendant, developer RM5,000 to them for costs.

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It was understood that the buyers stand to claim about RM10,000 each more or less in LAD depending on the date of the Sale and Purchase Agreement signed.

Recently, Shareda campaigns for a completion period of 40 months instead of 36 months for strata homes blaming in part the SESB for power outage as part of the delay woes besides material shortage like cement or steel bars at a period in the past as well as manpower shortage. - David Thien

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