Chapter 9 - Housing Developers

Question 1

HOUSING DEVELOPERS

Overview

Answer 1

1) Developer
2) SPA
3) VP
4) Defects liability
5) Power of attorney
6) Assignment under HDA
7) JMB
8) Sale of commercial properties by developer
9) Strata titles

Question 2

DEVELOPER

Overview

Answer 2

1) What is developer
2) Purpose of HDA
3) Duty of licensed developer

Question 3

DEVELOPER

What is developer

Answer 3

S.3 HDA

• Housing accommodation:
• Housing development:
• Housing developer:

Question 4

DEVELOPER

Purpose of HDA

Answer 4

1) City Investment v Koperasi Serbaguna Ceupacs Tanggungan Bhd:

• HDA is designed to protect the buyer;
• Any attempt to contract outside HDA is an open defiance of HDA.

2) Example - PP v Annamaly a/l Narayanan:
- When the housing market collapsed & buyers seek for refund, the court ordered the developer to pay refund to the buyers.

Question 5

DEVELOPER

Duties of licensed developer

Answer 5

1) S.5 - apply for license from Controller
2) S.7 - main duties
3) S.7A - open & maintain Housing Development Account
4) S.12 - powers of Minister to issue directions

Question 6

SPA

Overview

Answer 6

1) Forms of SPA

2) Rights of termination

Question 7

SPA

Forms of SPA

Answer 7

• Standard SPA: schedule G & H

- Non-standard SPA: sub-sale property, drafted by solicitors

Question 8

SPA

Rights of termination - overview

Answer 8

1) Statutory rights of termination

2) Doctrine of total failure of consideration

Question 9

STATUTORY RIGHTS OF TERMINATION

The law

Answer 9

Right to terminate - S.8A:

• Consent: must be sought;
• End financier: must not withhold consent unnecessarily;
• Right to terminate:
• Refund:

Offence - S.18A:

-

Question 10

DOCTRINE OF TOTAL FAILURE OF CONSIDERATION

The law

Answer 10

1) Part-performance is sufficient - Berjaya Times Square v M-Concept Sdn Bhd:

• If there is part-performance, S.40 is not invoked & parties may not put an end to the contract.
• In such a case, there is no total failure of consideration.

cf.
2) Part-performance of no value is valueless - Bungsar Hill Holdings v Damansara Realty Sdn Bhd:

• There is total failure of consideration if the work completed is of little or no value at all;
• There is a right to terminate in such a situation.

Question 11

VACANT POSSESSION

Overview

Answer 11

1) Ready for occupation
2) Water & electricity
3) CF or CCC
4) Time & manner of delivery
5) Remedies for late delivery

Question 12

VACANT POSSESSION

Ready for occupation

Answer 12

Limmewah Development Sdn Bhd v Dr. Jasbir Singh:

• the basic of VP is that the premise is ready for occupation.

Question 13

VACANT POSSESSION

Water & electricity

Answer 13

Salmah Sulaiman & Anor v Metroplex Development:

• Additionally, the water & electricity supply is ready for CONNECTION in the said building.

Question 14

VACANT POSSESSION

CF or CCC

Answer 14

Sykt Lian Hup (Liew Bros) Sdn Bhd v Chew Khong Chai:

• CF or CCC is not a condition for the delivery of VP;
• Application made for CF or CCC is sufficient.

Question 15

VACANT POSSESSION

Time & manner

Answer 15

• Schedule G: 24 months

- Schedule H: 36 months

Question 16

VACANT POSSESSION

Remedies for late delivery - option 1

Answer 16

Terminate the contract & claim for damages - S.56(1) CA

Question 17

VACANT POSSESSION

Remedies for late delivery - option 2

Answer 17

Affirm the contract & claim for LAD:

1) LAD how calculated

• GJH Avenue Sdn Bhd v Tribunal Tuntutan Pembeli Rumah
• Kompobina Holding v Tribunal Tuntutan Pembeli Rumah

– LAD shall be calculated from the actual date the SPA is entered into.

• Recent: PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah (FC) - LAD claim should be calculated from the date the booking fees are paid/payment of deposit/not from the date of SPA literally.
  2) Limitation period to claim for LAD
• 12 months from:
• – date of issuance of CCC
• – expiry date of the defects liability
• – date of termination of SPA

Question 18

DEFECTS LIABILITY

the law

Answer 18

Ding Cha Hee v Tan Wan Eng & Hong Kok Cheong:

• major defects of the work has not been proved to the satisfaction of the court.
• the minor defect proved cannot be a good reason for termination.

Question 19

CHARGES

the law

Answer 19

Lai Soon Cheong v Kien Loong Housing Development Sdn Bhd:

• There is no law which provides that before a chargee can accept a charge on lands, the said chargee must ensure that no sale of the subdivided lots has yet been carried out or that no sale and purchase agreement has been executed by the chargor.

Question 20

ASSIGNMENT UNDER HDA

Overview

Answer 20

1) Conditions for assignment
2) Notice to developer
3) Right to initiate or maintain action
4) Agreement vs assignment
5) Enforcement of assignment
6) Information from developer

Question 21

ASSIGNMENT UNDER HDA

Overview

Answer 21

1) Conditions for assignment
2) Notice to developer
3) Right to initiate or maintain action
4) Agreement vs assignment
5) Enforcement of assignment
6) Information from developer

Question 22

ASSIGNMENT UNDER HDA

Conditions for assignment

Answer 22

S.22D:

• writing:
• notice:
• date of effect:

Question 23

ASSIGNMENT UNDER HDA

Notice to developer

Answer 23

S.22D(2):

• by whom:
• when:
• together with:

Question 24

ASSIGNMENT UNDER HDA

Right to initiate or maintain action

Answer 24

S.22C:

• what matters:
• notification:

Question 25

ASSIGNMENT UNDER HDA Assignment vs agreement

Answer 25

Tan Yan Long v Newacres Sdn Bhd: - the agreement entered between P & metroplex is a loan agreement as opposed to assignment; - P therefore has the right & locus to maintain action.

Question 26

ASSIGNMENT UNDER HDA Enforcement of assignment

Answer 26

Damai Freight Sdn Bhd v Affin Bank Bhd: - lender may proceed to sell the property under the assignment w/o need to create charge under NLC & obtain OFS from the court.

Question 27

ASSIGNMENT UNDER HDA Information from developer

Answer 27

S.22D(4): - what: - to whom: - fees:

Question 28

JMB overview

Answer 28

1) what 2) duties 3) powers 4) application

Question 29

JMB what

Answer 29

S.17 SMA: - a body corporate having perpetual succession & a common seal. - comprises of developers and purchasers; - responsible for maintenance & management of the building.

Question 30

JMB duties

Answer 30

S.21(1) SMA

Question 31

JMB powers

Answer 31

S.21(2) SMA

Question 32

JMB application

Answer 32

Innab Salil & Ors v Verve Suites Mont Kiara: - whether can prohibit short-term rental: yes - whether it is in violation of Strata Management Act: no, as long as the short-rentals amount to licenses & not tenancies.

Question 33

SALES OF COMMERCIAL PROPERTIES BY DEVELOPER The law 101

Answer 33

1) Developer's consent 2) Administration fees 3) Nature of commercial properties: - not protected by HDA; - defects liability 12 months; - T&C under SPA is stated by developer.

Question 34

STRATA TITLES duty of developer

Answer 34

Sor Kok Wah & Others v Draland Sdn Bhd: - To make application for issuance of strata titles ; - Developer is bound by the statutory requirement to make the application; - Breach: liable to compensate the house buyer in respect of any damages arising from not having the strata title.