Schedule
Schedule H: “AND WHEREAS the Vendor has, at its own cost and expense, obtained the approval of building plans (hereinafter referred to as “the Building Plan”) from the Appropriate Authority (A copy of the Floor Plan, Storey Plan and Site Plan as certified by the Vendor’s architect are annexed in the First Schedule) [see: regulation 11(1) Housing Development (Control and Licensing) Regulations 1989] [29] Being one which is not governed under the HDA or any other law for that matter, parties to the agreement are indeed free to negotiate, draw and finalise their own terms and conditions to be incorporated into the agreement which was what the Plaintiff and Defendant appears to have done here in the SPA. [30] Thus, upon perusing the SPA particularly paragraph ‘E’ and ‘F’ under the ‘Preamble’, it is obvious that at the time of execution of the SPA, parties were aware that the approval of the proposed building plan (annexed as Second Schedule in the SPA) had yet to be obtained by the Defendant when it is stated in the said paragraph ‘E” that “The vendor will at its own cost and expense, apply and obtain the approval of the building plans…” as opposed to the statutory wordings “the Vendor has, at its own cost and expense, obtained the approval of building plans...” in both Schedule G and Schedule H agreement. The said Preambles ‘E” and ‘F’ in the SPA are reproduced below as follows: - [31] Next, this Court also finds that there is nowhere in the SPA which imposes obligation or duty to the Defendant to inform the Plaintiff about the approval of the proposed building plan prior to the commencement of the construction works or to the making of any payment claim for any or all of the works done. In this regard, I agree with the Defendant counsel’s submission that the learned SCJ had fallen into error in imposing such obligation when no duty for such is prescribed in the SPA (see also: Low Keang Guan v Sin Heap Lee-Marubeni Sdn Bhd [2005] 1 MLJU 286). [32] On the other hand, the Plaintiff’s duty to make payment appears to be based solely on the construction works done which is independent from any condition for MBJB approval. Reference is made to Clause 6 of the SPA which reads as follows: - “6. Schedule of Payment 1. The Purchase Price shall be paid by the Purchaser to the Vendor by instalments and at the time and in the manner as prescribed in the Third Schedule thereto. Each and every instalment payment shall be paid by the Purchaser to the Vendor within Fourteen (14) days commencing from the date of the written notice from the Vendor requesting for such payment. 2. Each written notice referred to in the Third Schedule hereto requesting for payment shall be supported by a certificate signed by the Vendor’s Architect or Engineer in charge of the Development (as the case may be) and every such certificate to signed shall be proof of the fact that the works therein referred to have commence” [33] In respect of the Defendant’s obligations relating to the construction of the building, the same has been specified in Clause 14 SPA which reads as follows: - “14. Construction of the said Property (1) The Vendor shall cause to be constructed the said property in a good and workmanlike manner in compliance with generally recognized building standards and practices, in accordance with the proposed building plan as duly approved by the Appropriate Authorities and in accordance with the specifications annexed hereto as the Fourth Schedule (hereinafter referred to as “the specification”) and the Proposed Building Plan and the specifications have been accepted by the Purchaser who hereby acknowledges and confirms the same.” [34] Although I have to admit that on plain reading of Clause 14, there is no doubt the Defendant is under duty to construct the building as per the proposed building plan approved by MBJB. However, when Clause 6 is read together with the ‘Proviso’ in Clause 24 and Preamble ‘E’ as discussed earlier, it is more consonant and harmony to hold that the phrase ‘in accordance with the proposed building plan as duly approved by the Appropriate Authorities’ in Clause 14 refers to MBJB’s approval as it is expected to be obtained in the future which at the time of the execution of the SPA was still pending. [35] Thus, since it is trite that a contract must be construed as at the date it was made and not in the light of what happened later, I hold that combined effect of the aforesaid clauses would lead to a single conclusion; that the approval of the proposed building plan from MBJB is to be the deciding factor in determining the effective period for actual or deemed delivery of vacant possession of the property in so far as Clause 24 of the SPA is concern. [36] In this regard, it must be recapped from the earlier part of my judgment that there is no detail explanation by the SCJ on what bearing that such failure to inform and construct without approval had influenced the SCJ in coming to his decision. Be that as it may and in view of my aforesaid findings, I have to say with due respect, that the SCJ had committed his first error of law in construing the SPA in the way that he did. [37] Next, although it is not disputed that the Defendant had commenced construction works without waiting for MBJB’s approval, that by itself in my view cannot be construed to mean the Defendant had represented to the Plaintiff that the said approval had been duly obtained when the Defendant started to commence the construction works. Such proposition of fact has even gone too far from its truest sense when the SCJ ultimately decided to invoke estoppel against the Defendant when the so-called constructions without approval was neither the cause nor reason that induced the Plaintiff to enter into the SPA with the Defendant. [38] The width of the doctrine of estoppel as has been summed up by Lord Denning in the Amalgamated Investment case [1981] 3 All ER 577 and applied in our shores vide Boustead Trading (1985) Sdn Bhd v Arab-Malaysian Merchant Bank Bhd [1995] 3 MLJ 331 are as follows: - “…When the parties to a transaction proceed on the basis of an underlying assumption – either of fact or of law – whether due to misrepresentation or mistake makes no difference – on which they have conducted the dealings between them – neither of them will be allowed to go back on that assumption when it would be unfair or unjust to allow him to do so. If one of them does seek to go back on it, the courts will give the other such remedy as the equity of the case demands.” [39] Thus, when preambles (E) and (F), Clause 6 and Clause 14 referred to earlier have been incorporated into the SPA, the Plaintiff cannot later turn around and say that that there was an ‘underlying assumptions’ that MBJB approval had been obtained by the Defendant at the time the Defendant started to commence the construction works on the property. In this regard, I have to say with due respect again, that the SCJ had committed another error of law, this time for invoking the maxim estoppel on a set of facts that do not justify for estoppel to be imposed... [40] To my mind, the learned SCJ must have been laying too much concern over the fact that the construction works were commenced without first obtaining approval from MBJB which is the relevant authority in the instant matter under the Town & Country Planning Act 1976 (“TCPA”) and Street, Drainage and Building Act 1974 (“SDBA”). In this regard, I am of further view that although the Defendant’s action in commencing construction works without MBJB approval may have violated TCPA or SDBA as submitted by the Plaintiff’s counsel, to hold that since such action is illegal, thus the maxim ex turpi causa (one cannot benefit from one’s wrong) must be injected in construing Clause 24 so as to militate against the Defendant’s defence is clearly misplaced. [41] Our Courts have been consistent in holding that not all actions by a party to a contract that violated the law would result in illegality of the said contract. Suffice to cite Beca (M) Sdn Bhd v Tan Choong Kuang & Another [1986] 1 MLJ 390 as an authority for that proposition of law, it was held by the Supreme Court then that - “… Not every breach of a statutory prohibition would render an agreement illegal or void though such breach may attract criminal penalty. The fundamental question is whether the Enactment means to prohibit the agreement. It is important that the courts should be slow to imply the statutory prohibition of agreement, and should do so only when the implication is clear. Whether an agreement is implicitly forbidden depends upon the construction of the statute, and for this purpose no one test is decisive. Persons who deliberately set out to break the law cannot expect to be aided in a court of justice. It would be a different matter when the law is unwittingly broken. An agreement for the sale of, say, frozen food, is not to be considered illegal or void merely because the premises in which the frozen food is sold does not comply with the law. We recognise that each case must be decided by reference to the relevant statute.” [42] Although it was not the Plaintiff’s case here that the SPA ought to be declared as illegal, but the legal effect the Plaintiff was trying to impose towards the Defendant’s so-called illegal action is somewhat similar, in that the Defendant cannot be allowed to benefit from its own wrong. The question then is, what wrong have the Defendant committed against the Plaintiff by commencing the construction works without first obtaining approval from MBJB? [43] Based on the facts and circumstances of the instant matter, my straight answer to that question is ‘nothing’. I am even prepared to hold further that even if such action by the Defendant may attract criminal penalty under TCPA or SDBA, there is still no sufficient nexus between the Defendant’s criminal penalty and the Defendant’s breach of contractual obligations in the SPA. [44] Finally, by incorporating indemnity clause as per Clause 21 in the SPA that the Defendant would indemnify the Plaintiff against all fines, penalties or losses in the event of non-compliance of any laws relating to the work constructions, I hold that the said clause is not just mere ornaments. It was the last straw that breaks the camel’s back to the Plaintiff. Clause 21 forms an acknowledgement on the part of the Plaintiff that matters relating to MBJB’s approval is actually not of the Plaintiff’s concern right from the beginning. Perhaps it will not be harsh for me to evenly conclude that it is the Plaintiff who should be estopped from now raising the issue of such non-conformity of law in order to gain unfair advantage against the Defendant under the purported late delivery claim. For the sake of completion, Clause 21 of the SPA is reproduced below as follows: - “Compliance with written laws (1) The vendor shall in relation to the said Property to be erected, conform to the provisions and requirements of any written law for the time being in force affecting the Development and shall keep the purchaser indemnified against all fines, penalties or losses incurred by reason of any breach of the provisions of any written laws from the Vendor.” [45] Defendant in fact had paid its dues to MBJB for the said non-compliance in the sum of RM 95,542.68. The Plaintiff had knowledge about it and never disputed it. [46] Thus, based on the overall assessment of evidence and after revisiting the approach taken by the SCJ in construing contract clauses vis-a-vis the SPA, I am satisfied that the learned SCJ had fallen into error in his interpretation of Clause 24 and other relevant clauses in the SPA that had resulted with his conclusion to be plainly wrong in law, and so I hold accordingly. Conclusion [47] Based on the reasons as adumbrated above, I allowed the appeal by the Defendant, set aside the decision of the SCJ and finally dismissed the Plaintiff’s claim against the Defendant with costs. Dated: 15th APRIL 2024 …………………………………………. (NOOR HISHAM BIN ISMAIL) Judicial Commissioner High Court, Johor Bahru Counsels for Appellant Mr Christopher Yeo Wee Choon together with Ms Angie Tan Yi Chuin Messrs Christopher Yeo & KP Chang Kuala Lumpur Counsels for Respondent Mr Kuthubul Zaman bin SNS Bukhari together with Ms Anis Syarizad binti Kuthubul Zaman Messrs Syarizad Zaman & Seah Johor Bahru Cases referred to: 1. SPM Membrane Switch Sdn Bhd v Kerajaan Negeri Selangor [2016] 1 MLJ 464 2. Lucy Wong Nyuk King (F) & Anor v Hwang Mee Hiong (F) [2016] 3 MLJ 689 3. Perbadanan Kemajuan Negeri Selangor v Selangor Country Club Sdn Bhd [2017] 2 MLJ 819 4. Low Keang Guan v Sin Heap Lee-Marubeni Sdn Bhd [2005] 1 MLJU 286 5. Boustead Trading (1985) Sdn Bhd v Arab-Malaysian Merchant Bank Bhd [1995] 3 MLJ 331 6. Town & Country Planning Act 1976 (“TCPA”) and Street, Drainage and Building Act 1974 7. Beca (M) Sdn Bhd v Tan Choong Kuang & Another [1986] 1 MLJ 390 Legislation referred to: 1. Housing Development Act 1966 2. Town & Country Planning Act 1976 3. Street, Drainage and Building Act 1974