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HHQ Cases & Facts


13 Dec 2022

IB Builders Sdn Bhd V DSS Capital Sdn Bhd & Anor I High Court
The case above involves a claim for specific performance made by the Plaintiff against the Defendants. In essence, the Plaintiff commenced a legal action for an order of specific performance agai[..]
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Federal Court Unanimously Dismissed Purchasers’ Notice of Motion For Leave to Appeal to Federal Court

ALVIN LEONG WAI KUAN & 14 ORS v BLUDREAM CITY DEVELOPMENT SDN BHD AND OTHER APPEALS . Federal Court Civil Application No. 08(f)-337-08/2021(B), 08(f)-339-08/2021(B), 08(f)-344-08/2021(B), 08(f)-345-08/2021(B), 08(f)-346-08/2021(B), 08(f)-347-08/2021(B) Coram: Y.A.A. Tan Sri Datuk  Amar Abang Iskandar Bin Abang Hashim, HBSS, Y.A. Dato Rhodzariah Binti Bujang, HMP, Y.A. Dato’ Mohamad Zabidin Bin Mohd Diah, HMP. Decision delivered on 04.01.2023. Holding Watching Brief: Real Estate and Housing Developers' Association Malaysia (“REHDA”): Represented by of Mr. Thoo Yee Huan of Messrs Halim Hong & Quek     BRIEF FACTS The purchasers and the developer have entered into sale and purchase agreements (“SPA”) after the Controller has granted extension of time to complete the Project within 42 months to the developer (“1st Extension”). Subsequently, there was a 17-months stop work order (“the SW Order”) issued by Majlis Perbandaran Subang Jaya (“MPSJ”) as it was discovered that there were cracks on the school building beside the construction site of the Project. The developer then further applied to the Controller for extension of time to deliver vacant possession from 42 months to 59 months due to the SW Order but the Controller only granted an extension from 42 months to 54 months. The developer appealed to the Minister and the Minister allowed the further extension from 42 months to 59 months (“2nd Extension”). Unsatisfied with the Minister’s decision, the purchasers filed applications for judicial review against the 2nd Extension. The purchasers did not challenge the 1st Extension in the judicial review applications.   HIGH COURT’S DECISION The learned judge in the High Court has allowed the judicial review applications on the basis that he was bound by the decision of the Federal Court in Ang Ming Lee & Ors v Menteri Kesejahteraan Bandar, Perumahan dan Kerajaan Tempatan & Anor and other appeals [2020] 1 CLJ 162 (“Ang Ming Lee”). The learned judge also proceeded to invalidate the 1st Extension despite there being no challenge on the 1st Extension.   COURT OF APPEAL’S DECISION The developer, Minister and Controller then filed an appeal to the Court of Appeal. The Court of Appeal allowed the appeal and set aside the High Court’s decision and has distinguished the current case from Ang Ming Lee as the purchasers in the current case did not challenge against the 1st Extension in the judicial review applications. The court is of the view that : - i. Although the Federal Court in Ang Ming Lee held that Regulation 11(3) of the Housing Development (Control and Licensing) Regulations 1989 is ultra vires the Housing Development (Control and Licensing) Act 1966 (“HDA”), it did not oust the Minister’s power to grant extension of time under Section 24(2)(e) of HDA; ii. The purchasers’ right to be heard by the Minister prior to granting the extension of time is not expressly stated in HDA, shall be determined on a case-by-case basis; iii. Parliament has granted flexibility to the Minister to grant extension of time under Section 24(2)(e) of HDA, which the Minister in granting the 2nd extension had taken into account relevant considerations which includes :- a. Reasonableness, fairness, proportionality and human decency; b. Balancing the competing interests of the parties; and c. Circumstantial facts revolving around the Project.   FEDERAL COURT’S DECISION Unsatisfied with the Court of Appeal’s decision, the purchaser then filed a Notice of Motion for leave to appeal to the Federal Court. Two primary questions of law have been orally submitted and argued by the parties’ counsel including from the Attorney General Chambers representing the Government whereby involving whether the Minister has power to grant extension of time and whether natural justice need to be observed with purchasers being accorded the right to be heard. Upon hearing the parries, the Federal Court has today unanimously dismissed the motion being not able to satisfy the threshold required under the Court of Judicature Act 1964 and with no order as to costs.   COMMENTARY With this refusal to grant leave by the Federal Court, the Court of Appeal decision of this case is now legally binding. It will now bring the closure of the issue whether the Minister has power to grant extension of time based on the circumstances of each case upon taking into account relevant considerations which may include the circumstantial facts revolving around the Project as long as the Minister’s decision was arrived by the light of reason, logic, and the exceptional exigencies even without hearing the rights of the purchasers. Furthermore, there was an expert report justifying the said decision. Even in Ang Ming Lee case, the Apex Court recognises the Minister’s discretion and power to grant such extension.     However, the impact of this Federal Court decision may not resolve/assist the pending cases in courts where the extension of time is granted by Controller. . This case update is an updated version of our case update dated 21 July 2021 . This article is intended to be informative and not intended to be nor should be relied upon as a substitute for legal or any other professional advice. About the Authors Thoo Yee Huan Senior Partner, Dispute Resolution Halim Hong & Quek yhthoo@hhq.com.my . Hee Sue Ann Associate, Real Estate Halim Hong & Quek sahee@hhq.com.my