Casa Venicia Joint Management Body v 1. ) Ideal Heights Properties Sdn Bhd (BA-22NCvC-81-02/2022)

IDEAL HEIGHTS PROPERTIES SDN BHD

PENTADBIR TANAH DAERAH GOMBAK EFENDAN-DEFENDAN GROUNDS OF JUDGMENT Introduction [1] In this action, the Casa Venicia Joint Management Body ( ) invoked section 143(2) of the Strata Management Act 2013 ( ) to sue the 1st Defendant ( Developer ) on behalf of some or all parcel owners in the strata development, essentially to claim title to land on which the Developer had constructed a clubhouse and facilities ( ), on grounds that the Clubhouse is part of the common property of the strata development. 13/06/2025 09:09:23 BA-22NCvC-81-02/2022 Kand. 91 [2] The problem is that the Developer is the registered proprietor of the Clubhouse land, a fact that the Plaintiff says it was unaware of until

In 2021, the Developer proposed to re-develop the Clubhouse land and build a 33-storey service apartment tower there. This entails demolishing the clubhouse building, a swimming pool, jogging paths and foot bridges over parts of the lake. Background facts [3] The Clubhouse is part of a larger development called Casa Venicia Lakeview Condominium Bukit Idaman, comprising Blocks A, B, C, D, E, F, G (Greenview Condo), H (Greenview Tower), Casa Venicia Tower and Clubhouse, all constructed around a man-made lake ( ). [4] The sale and purchase agreements for the individual parcels of condominium units in the Development were standard Schedule H form of contracts per regulation 11 of the Housing Development (Control and Licensing) Regulations 1989 made under the Housing Development (Control and Licensing) Act 1966 ( ). [5] Based on specimen sale and purchase agreements tendered in evidence, the original purchasers signed the standard sale and purchase agreement ( SPA ) together with a supplementary agreement relating to the use of the Clubhouse ( Supplementary Agreement ) with the Developer. These were mostly signed in the 1990s before the Building and Common Property (Maintenance and Management) Act 2007 came into force on 12-4-2007 and well before the SMA came into force in Selangor on 1-6-2015. [6] The Plaintiff was formed on 29-3-2008 under section 7(2) of the BCPA (now repealed) in respect of HS(M) 12917, HS(M)12982, HS(M)12983 and Lot PT No. 21623, 21688 and 21689 which, as determined in the course of the trial, corresponded to Blocks A-G of the Development. It is also recognized as the joint management body of the Casa Venicia Tower block at HS(H) 20553 PT No. 34410. [7] The original 4 master titles comprised in the Development have undergone a series of amalgamation and sub-divisions into the 7 separate titles that exist today. The Development currently sits on these 7 separate titles as follows (collectively, the Development L ): Block Title/Date Issued Registered Owner/Address Date Registered G PM 246, Lot 52015, Mukim Batu, Daerah Gombak, KM 15, Jalan Rawang 22-2-1994 Perbadanan Pengurusan Casa Venicia Greenview 1/1 bahagian. No. 1-2, Jalan Bkt Idaman 8/1, Bkt Idaman Selayang, 68100 Selangor 13-7-2011 H PM 247, Lot 52013, Mukim Batu, Daerah Gombak, KM 15, Jalan Rawang 22-2-1994 Perbadanan Pengurusan Casa Venicia Greenview Tower, 1/1 bahagian. Ideal Heights Properties Sdn Bhd, No. 1-2, Jln Idaman 8/1, Bkt Idaman Bt Caves, 68100 Selangor 13-7-2011 E, F PM 319, Lot 52140, Bandar Selayang, Daerah Gombak, KM 15, Jalan Rawang 18-3-1996 Perbadanan Pengurusan Casa Venicia Blk E,F, 1/1 bahagian. Ideal Heights Properties Sdn Bhd, No. 1-2, Jln Bkt Idaman 8/1, Bukit Idaman Selayang, 68100 Selangor 9-4-2014 B, C, D PM 320, Lot 52141, Bandar Selayang, Daerah Gombak, KM 15, Jalan Rawang 18-3-1996 Perbadanan Pengurusan Casa Venicia Blk B,C,D, 1/1 bahagian. Ideal Heights Properties Sdn Bhd, No. 1-2, Jln Bkt Idaman 8/1, Bukit Idaman Selayang, 68100 Selangor 9-4-2014 A PM 326, Lot 52133, Bandar Selayang, Daerah Gombak, KM 15, Jalan Rawang 9-7-1996 Perbadanan Pengurusan Casa Venicia Blk A, 1/1 bahagian. Ideal Heights Properties Sdn Bhd, No. 1-2, Jalan Bukit Idaman 8/1, Bukit Idaman Selayang, 68100 Selangor 9-4-2014 Clubhouse PM 378, Lot 60292, Bandar Selayang, Ideal Heights Properties Sdn Bhd, 1/1 bahagian. 30-12-1998 Daerah Gombak, KM 15, Jalan Rawang 30-12-1998 KM 15, Jalan Ipoh, Bukit Idaman, Batu Caves, 68100 Selangor Tower PM 379, Lot 60293, Bandar Selayang, Daerah Gombak, KM 15, Jalan Rawang 30-12-1998 Perbadanan Pengurusan Casa Venicia 1/1 bahagian, No. 1&2, Jalan Bukit Idaman, Bukit Idaman Selayang, 68100 Selangor. 5-3-2021 [8] On 1-8-2014, the Plaintiff and the Developer entered into a Clubhouse/Community Centre/Facilities Operation and Management Agreement ( ) by which the Plaintiff was obliged to manage these facilities, bear all operational costs of the facilities and pay the Developer RM1.00 annually. The recital in the Clubhouse Management Agreement states that: [9] On 16-3-2021, the Plaintiff sent the following query to the Developer: [10] Despite several reminders, there was no response until 5-4-2021, when the Developer responded as follows: [11] In 2021, the Developer submitted a proposal to the Plaintiff on the re-development of the Clubhouse land. Based on a slide deck of the proposal, the 33-storey service apartment tower was to be built on the Clubhouse land and directly adjacent to the existing Tower block and block views of the lake: [12] The proposal was objected to by the Plaintiff and it led to this action. Analysis and Findings [13] The core issue in this case is whether the Clubhouse which is on land owned exclusively by the Developer, was unlawfully extricated from what was understood to be the common property of the Casa Venicia Lakeview Condominium Bukit Idaman development, sleight of hand in subdividing the Clubhouse land and naming itself as the registered proprietor. Preliminary issue of locus standi [14] Although the applicability of section 143(2)(a) of the SMA was pleaded by the Developer, it was apparently abandoned in post-trial submissions. Evidence for the Plaintiff was given through Sharon Loo binti Abdullah (Loo Peoy Ha) (PW1), the Chairman of the Plaintiff and Harjit Singh a/l Sohan Singh (PW2), a committee member. Both are sub-sale purchasers of units in the Tower block. [15] By virtue of sections 7 and 38 of the SMA, Part IV of the SMA applies to the Development Lands as vacant possession of parcels in all the blocks have been delivered to purchasers before the commencement of the SMA. The Plaintiff is deemed to have been established under the SMA. [16] According to section 143(2)(a) of the SMA, it is possible for the Plaintiff to sue in a representative capacity on behalf of all or some of the The provision reads as follows: parcels in a development area-

(a) are jointly entitled to take proceedings for or with respect to the common property in that development area against any person or are liable to have such proceedings taken against them jointly; the proceedings may be taken-

(A) in the case of paragraph (2)(a), by or against the joint management body or management corporation; as if the joint management body, management corporation or subsidiary management corporation, as the case may be, were the [17] The Federal Court in Datuk Bandar Kuala Lumpur v Perbadanan Pengurusan Trellises & Ors and other appeals [2023] 5 CLJ 167 ) held that a joint management body and a management corporation, cannot act beyond that which is authorised by the specific legislation creating them. [18] The relevant provisions of the SMA on the duties and powers of the Plaintiff, are in section 21 of the SMA, and are insofar as relevant, those duties and powers are limited to the maintenance and management of the building or land intended for subdivision into parcels, and the common property. In its broadest terms, these include the duty:

(i) to do such other things as may be expedient or necessary for the proper maintenance and management of the buildings or lands intended for subdivision into parcels and the common property. [19] It was held in Datuk Bandar that the joint management body and management corporation who represented parcel proprietors in developments close to or neighbouring the subject land who were adversely affected by a Development Order that contravened the Kuala Lumpur Structure Plan had no capacity to commence judicial review proceedings to quash it. However, Datuk Bandar also held:

(a) Declarations

(i) that the Supplementary Agreement and Clubhouse Management Agreement are void for non-compliance with the HAD [Para (a) to (c) of the Statement of Claim]

(d) to (e) of the Statement of Claim]

(b) Orders

(i) name from the titles to the [Development Lands] and register them to the Plaintiff or the Management Corporation [Para (g) to (i) of the Statement of Claim]

(a) in relation to his parcel (in the case of a parcel proprietor), the powers conferred by the National Land Code on a proprietor in relation to his land; and

(b) in relation to the common property, the right of user which he would have if he and the other proprietors were co-proprietors thereof. [31] The amalgamation and subdivision of the master titles to the Development Lands in this case was premised wholly on representations by the Developer in its application to the land office and as DW1 testified, the Clubhouse land was always intended to be retained by the Developer under a separate title for future development. [32] Prior to the 2013 amendment to the STA, there was no need for the strata plan to set out the common property in the development. Distinguishing Malaysia Land Properties Sdn Bhd v Waldorf and Windsor Joint Management Body [2014] 6 CLJ 821, there is no evidence of a strata plan identifying the Clubhouse land as common property. In any case, there was no legible strata plan in evidence at all that parties referred during the trial to clarify this point. [33] As a matter of law, the Court of Appeal in Perantara Properties Sdn Bhd v JMC Kelana Square & Anor Appeal [2016] 5 CLJ 367 ( ) found that the developer was justified in not handing over carparks to the joint management body formed under the BCPA in that case, because the carparks had been excluded from the common property through the sale and purchase agreements of the commercial units in 1995. The Developer was accordingly allowed to rent the carparks back to the purchasers for a fee. [34] The Court of Appeal in Perantara Properties found that the BCPA which defined common property broadly to expressly include carparks, had no retrospective effect to alter the 1995 sale and purchase agreements entered into by purchasers which excluded carparks from the sale, and that any retrospective application of the BCPA would have the effect of re-writing the contracts and deprive the developer of its property rights. [35] The present development also took place at the time when the HDA and STA were the only applicable statutes governing strata developments. The definitive provision for what constitutes common property were then found in the contractual documents that the purchasers signed. Based on binding authority, the law did not restrict a developer from using, dividing or reserving what might otherwise be understood as common property including the leasing or sale of carparks to a third party. [36] Evidentially, this Court also finds that the available evidence on the contractual documents in this case is sufficiently clear and corroborates of the common property. It was not seriously contested as a matter of interpretation or otherwise that:

(a) the Clubhouse and swimming pool were not included in the in all the SPAs;

(b) the Supplementary Agreement granted the purchasers a license to use the Clubhouse and the club facilities, which according to section 34 of the STA would be unnecessary if it is common property. Thus unlike JMB Silverpark Sdn Bhd v. Silverpark Sdn Bhd [2012] CLJU 1082; [2012] 1 LNS 1082; [2013] 9 MLJ 714 the clubhouse is not a common facility under the Schedule to the SPAs in this case. [37] For completeness, it is noted that the BCPA, STA, SMA and HDA all defined common property differently. The Schedule H definition of common property in Clause 31(c) of the SPAs includes where the context used or enjoyed in common by all the purchasers The Court of Appeal in Sri Keladi Sdn Bhd (In liquidation) v Bukit OUG Condominium Joint Management Body [2022] CLJU 1498 specifically rejected the construction of this clause to mean that all residual unassigned carparks are common property. Extending the rationale to the present case, what is not common property under the SPAs cannot by usage, be converted into common property. [38] The inclusion of the Clubhouse within the ambit of common property by virtue of an expansive interpretation of clause 31(c) of the SPAs would have the effect of disregarding the commercial context and intention of the parties as otherwise evidenced by clause 15 and the Third Schedule to the SPAs. It would seem that the specific contractual provisions in the Schedule to the SPAs and Supplementary Agreement were intended to make it clear that the Clubhouse and its facilities were excluded from the common property (See also Prestaharta Sdn Bhd v Ahmad Kamal Md Alif & Ors [2016] 4 MLJ 39). [39] Thus, this Court finds that the Clubhouse land was lawfully subdivided and registered to the Developer, consistent with the fact that the Clubhouse is not common property, albeit contrary to pre-contractual representations made to purchasers, but that is a separate issue. Fraudulent misrepresentation [40] The Developer argues that it has indefeasible title to the Clubhouse land according to section 340 of the NLC, subject to section 340(2) of the NLC and can do with it as it pleases. [41] This Court finds that there is in fact ample evidence of misrepresentation by the Developer in its pre-contract sales activities. The Developer represented that the Clubhouse was part of the common property knowing full well that it was not, in that the Clubhouse is mentioned in various parts of the brochure without any qualification or explanatory note, including a full-page artistic rendition with following description: The Hub of Social Life-equipped clubhouse on 2-levels, with uniquely designed windows, arches and colonnades hugging the perimeter of the building. An exquisite setting for the pursuit of sports and recreational pastimes, for the discerning few at Casa Venicia. Where lif The site plan in the SPAs for the Tower block, which is located closest to the Clubhouse, also feature the Clubhouse as follows: [42] Based on the above, this Court finds that the Developer did communicate misleading information to purchasers. The possible wrongdoing of the Developer is in the fraudulent pre-contractual misrepresentations to purchasers that the Clubhouse and facilities were part of the common property, knowing that it was not and never intended to be. This Court also noted the subtle actions by the Developer which had the effect of concealing the deception such as the mention of upkeep of the Clubhouse grounds in the SPAs, contribution of sinking fund by purchasers for the maintenance of the Clubhouse in the Supplementary Agreement, having the Plaintiff pay quit rents and the unexplained delay in the release of strata titles and formation of the management corporation. [43] The Plaintiff led evidence and argued fervently in post-trial submissions that the Developer had actively misrepresented to purchasers that the Clubhouse is common property and created a legitimate expectation that the facilities belong to the residents. However, it is only a misrepresentation if the representations are false. The premise to be true i.e. that the Clubhouse is common property. [44] As discussed at the outset, the present action is not a representative claim based on the fraudulent misrepresentation of the purchasers to seek rescission of the SPAs and/or individual claims for damages. Such fraudulent misrepresentations by the Developer to induce purchasers to enter into the SPAs and Supplementary Agreement under a false impression, are not connected in any relevant way to the Developer acquiring title to the Clubhouse land. [45] The objective fact is that prior to the sub-division and amalgamation exercise, the Developer was already the registered proprietor of all the Development Lands and the complaint, in essence, is that it did not vest the sub-divided Clubhouse land to the Plaintiff. The burden is on the Plaintiff to prove that title to the Clubhouse land is vitiated under section 340(2) of the NLC with relevant evidence that the Developer acquired title to the Clubhouse land through fraud or misrepresentation to the land office. [46] The Plaintiff argument of fraud at the land office in that sense can only be premised on a conclusive determination that the Clubhouse is common property. However, this Court has rejected this premise considering the legally permitted and deliberate exclusion of the Clubhouse a in the SPAs and the licensing of access and use of the Clubhouse according to the Supplementary Agreement. Supplementary Agreement and Clubhouse Management Agreement [47] The Plaintiff contended that the Supplementary Agreement is contrary to the HDA because it departs from the standard HDA prescribed form of SPA, imposing additional obligations on purchasers not found in the prescribed form. The Plaintiff referred to:

(a) the exclusion of the Clubhouse from the SPAs and licensing of its use through the Supplementary Agreement;

(b) the imposition of quit rent, maintenance charges imposed by the Developer and a sinking fund to maintain the common property and the Clubhouse;

(c) the prescription of rules and regulations for the use of the common property and the Clubhouse; and

(d) the prohibitions on renovations and other modifications and [48] This Court finds that the Supplementary Agreement is akin to a Deed of Mutual Covenant for the regulation of strata living during the D contradict or take away rights enshrined in the Schedule H SPAs. In particular, at the risk of repetition, the Clubhouse is not listed in the SPAs as common property. [49] There are accordingly no grounds to conclude that the Supplementary Agreement and Clubhouse Management Agreement are illegal and void. In any case, rescission of the Supplementary Agreement and C in any way. They are in fact the quite important instruments that operate to grant parcel owners a perpetual license to use the Clubhouse. Re-development of Clubhouse land [50] As represented by the Developer at all material times and further as undertaken according to the terms of the Supplementary Agreement, the Clubhouse and the club facilities are for the joint usage of purchasers in different phases of the Development. [51] DW1 confirmed that the SPAs do not provide for separate management of or additional cost to purchasers to enjoy the use of the Clubhouse facilities and as this Court has found, there were continuing representations by the Developer that residents in the development enjoyed access to the Clubhouse and its facilities as licensees according to the terms of the Supplementary Agreement. [52] Developer had actively misrepresented to purchasers, through brochures and other marketing materials, that the Clubhouse and common facilities would form part of the common property, this certainly created expectations. As this Court has determined, the expectation that the Clubhouse is common property is negated by the contractual documents. However, premised on purchasers undertook to pay for and did pay for the maintenance of the Clubhouse and further, at the request of the Developer, the Plaintiff also paid the quit rent and assessment on the Clubhouse land. [53] In other words, there is evidence of facts that set up an estoppel to restrain the Developer from denying the purchasers perpetual license to use the Clubhouse as licensees. Such evidence was led without objections. [54] This Court notes that the basis for the injunction sought by the Plaintiff to restrain the Developer from redeveloping the Clubhouse is pleaded to be proprietary in nature, but as further or other relief, there is just reason and sound basis for this Court to invoke the doctrine of equitable estoppel to grant the injunction sought to restrain the Developer from demolishing the Clubhouse and its facilities for so long as the parcel licenses are in place, and thereafter, from doing so without compensation for the deprivation of that equity. Conclusions [55] part. With reference to the prayers in the Statement of Claim: