COUNTRY GARDEN DANGA BAY SDN BHD V HOUSING TRIBUNAL & HO CHEE KIAN
[2022] 1 LNS 662 (FEDERAL COURT)
Coram: Zaleha Yusof FCJ, Zabariah Mohd. Yusof FCJ, Rhodzariah Bujang FCJ
Brief facts:
The 2nd Respondent (Purchaser) entered into a Sale and Purchase Agreement (“SPA”) under Schedule H of the Housing Development (Control and Licensing) Regulations with the Appellant (Developer) on 23.8.2013 to purchase a unit with parcel no. Block 11-A-3402 (“the Unit”). Vacant possession was subsequently delivered to the 2nd Respondent on 01.11.2017 wherein he accepted the vacant possession by signing on the inspection form and thereafter proceeded to renovate the Unit.
Unhappy with his Unit, the 2nd Respondent filed a claim against the Appellant to the 1st Respondent (Tribunal for Homebuyer’s Claim) on 02.01.2018 alleging that the 2nd Respondent was given the wrong unit because it came with an open balcony and not the covered balcony that he has requested for and therefore sought for damages.
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Tribunal’s Decision
The Tribunal found in favour of the 2nd Respondent by giving a ruling to amend the Unit’s specifications in the SPA to a Unit with covered balcony as the feature of the display model under section 16Y (2) of the Housing Development (Control and Licensing) Act 1966 (“HDA 1966”) and awarded the sum of RM50,000.00.
The Appellant aggrieved by the decision has filed for judicial review at the High Court to quash the decision of the Tribunal and subsequently appealed to the Court of Appeal. Unfortunately, both Courts upheld the decision of the Tribunal and hence, this appeal by the Appellant to the Federal Court.
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Federal Court’s Decision
The appeal raises four (4) questions of law namely: –
- (a) The extent of the Tribunal’s jurisdiction under Section 16N (2) HDA 1966;
(b) The extent of the Tribunal’s power under Section 16Y(2)(e) HDA 1966;
(c) Estoppel issue; and
(d) Natural justice issue.
The Federal Court held that the Tribunal does not have the jurisdiction to consider the balcony issue raised by the 2nd Respondent because it was not a term in the statutory SPA. Tribunal’s jurisdiction shall be limited to a claim based on a cause of action arising from the express terms contained in the SPA and exclude any other collateral contracts outside the SPA. (Section 16N (2) of HDA 1966)
The Tribunal also does not have the power to rectify the SPA to include terms which are inconsistent with the statutory SPA. The Federal Court held that the Tribunal’s power to vary or set aside the contract under Section 16Y(2)(e) of HDA 1966 shall be exercisable only in situation where there is inconsistency with the statutory SPA.
On the estoppel issue, the Federal Court held there was an estoppel by conduct on the part of the 2nd Respondent when he accepted the vacant possession and exercised his right to ownership by renovating the unit. As such, the 2nd Respondent is estopped from claiming that he was given the wrong unit.
Lastly, the Federal Court found there was no breach of natural justice as they are of the view that the Appellant had been given ample opportunity to examine the documents where they had some 2 months before the hearing to respond to the 2nd Respondent’s allegations that the SPA had been modified without consent and hence there was no issue of surprise.
The appeal by the Appellant was allowed accordingly with cost of RM30,000 and the award of the Tribunal was therefore set aside.
This Case Update is intended to be informative & is not intended to be nor should be relied upon as a substitute for legal or any other professional advice.
Written by:
TEOH ZI HAN
LL.B (Hons) Cardiff University
ASSOCIATE (REAL ESTATE)
zhteoh@hhq.com.my
