Yew Huoi, How & Associates | Leading Malaysia Law Firm

Menu

PROPERTY LAW– DEVELOPERS – LATE DELIVERY OF HOUSES – HOUSE BUYERS – LIQUIDATED ASCERTAINED DAMAGES – LATE DELIVERY OF HOUSES

I went to a showroom and I’ve decided to purchase a house. They asked me to fill up a form and pay an amount of RM10,000. Is the collection legal?

No.

  • Regulation 11(2) Housing Development (Control & Licensing) Act 1989 (‘HDA 1989’): “Everyone, not just developers, is prohibited from collecting booking fees”.
  • The scope of prohibition is wide enough to include lawyers, estate agents and any third parties purportedly acting as stakeholders for the housing developer in respect of collection of the booking fees.
  • The first 10% of the purchase price is only payable immediately upon signing of sale and purchase agreement (‘SPA’).
  • When it comes to interpreting social legislation, the courts must give effect to the intention of Parliament and not the intention of parties.

What to do when a developer fails to deliver the property in accordance with the timeline provided in the SPA?

  • The vacant possession of the house must be delivered to the house buyer in accordance with the timeline provided in the SPA.
  • Developers are required to deliver the vacant possession of a landed home with an individual title within 24 months from the SPA date whereas for strata-titled properties such as condominiums, serviced apartments has to be delivered within 36 months.
  • Pursuant to Clause 24(1) of Schedule G of the Housing Development (Control and Licensing) Act 1966 (‘HDA 1966’), developer ought to pay liquidated ascertained damages (‘LAD’), which is late delivery payment to the house buyer for the period of delay.

How is LAD calculated?

  • Many people might think that the calculation for LAD to house buyers begins when the SPA is signed.
  • In recent case of Tribunal PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah @ Ng Chee Kuan, the Federal Court has decided that the LAD should be calculated from the date the booking fee is collected, not the date the SPA is signed.

Whether house developers can be exempted from paying LAD during MCO?

  • Section 35 of the Covid-19 Act 2020 provides that house buyers cannot claim from developers the LAD incurred during the period of 18.3.2020 – 31.8.2020.
  • Under section 35(2), the developer is allowed to seek for an extension up to 31.12.2020.

late delivery

Back to Latest Legal Updates

Recent Post

JURISDICTION – CHOOSING THE RIGHT COURT: THE SEA JUSTICE CASE HIGHLIGHTS WHERE MARITIME DISPUTES SHOULD BE HEARD

In The Sea Justice cases [2024] 2 Lloyd’s Rep 383 and [2024] 2 Lloyd’s Rep 429, the Singapore courts tackled a key question: which country should handle a maritime dispute when incidents span international waters? After examining the location of the collision, existing limitation funds in China, and witness availability, the courts concluded that China was the more appropriate forum. This ruling highlights that courts will often defer to the jurisdiction with the closest ties to the incident, ensuring efficient and fair handling of cross-border maritime disputes. This approach is also relevant in Malaysia, where similar principles apply.

Read More »
17 11 月 ,2024 尚無留言

BREACH OF CONTRACT – FORCE MAJEURE – FORCE MAJEURE UNPACKED: WHEN ‘REASONABLE ENDEAVOURS’ DON’T BEND CONTRACT TERMS

The UK Supreme Court clarified the limits of force majeure clauses, ruling that “reasonable endeavours” do not require a party to accept alternative performance outside the agreed contract terms. This decision emphasizes that force majeure clauses are meant to uphold, not alter, original obligations – even in unexpected circumstances. The case serves as a reminder for businesses to define alternative options explicitly within their contracts if flexibility is desired.

Read More »
17 11 月 ,2024 尚無留言

NEGLIGENCE – MEDICAL NEGLIGENCE – HOSPITAL ACCOUNTABILITY REINFORCED: COURT UPHOLDS NON-DELEGABLE DUTY IN MEDICAL NEGLIGENCE

In a landmark ruling, the court reinforced the hospital’s non-delegable duty of care, holding that even when services are outsourced to independent contractors, the hospital remains accountable for patient welfare. This decision emphasizes that vulnerable patients, reliant on medical institutions, must be safeguarded against harm caused by third-party providers. The ruling ultimately rejected the hospital’s defense of independence for contracted consultants, underscoring a high standard of duty owed to patients.

Read More »
17 11 月 ,2024 尚無留言

CONTRACTS – CONTRACT FOR THE SALE OF GOODS FOB – REMOTENESS OF DAMAGES IN BACK-TO-BACK CONTRACTS – COURT DEFINES LIMITS ON LIABILITY

In a complex dispute involving back-to-back contracts, the court clarified the boundaries for assessing damages, emphasizing that a chain of contracts does not automatically ensure liability passes through. Although substantial losses resulted from delays and disruption, the court highlighted the importance of the remoteness of damages, noting that each contract’s unique terms ultimately limited liability. This decision emphasise the need for parties in chain contracts to carefully define indemnity and liability provisions, as damages are assessed based on foreseeability rather than simply the structure of linked agreements.

Read More »
17 11 月 ,2024 尚無留言

TORT – BREAKING CONFIDENTIALITY – COURT CRACKS DOWN ON INSIDER LEAKS AND CORPORATE CONSPIRACY

In a recent ruling on corporate confidentiality, the court held two former employees liable for disclosing sensitive business information to a competitor, deeming it a breach of both employment contracts and fiduciary duties. This case highlights the serious consequences of unauthorized sharing of proprietary data and reinforces that such disclosures can lead to substantial legal and financial repercussions, even for the receiving parties if they knowingly benefit from confidential information.

Read More »
17 11 月 ,2024 尚無留言
zh_TWZH
en_USEN ms_MYMY zh_TWZH
× 联系我们