Ujana Mutiara Sdn. Bhd. v Tribunal Tuntutan Pembeli Rumah (WA-25-241-04/2022)

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1 DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN KUALA LUMPUR, MALAYSIA (BAHAGIAN KUASA-KUASA KHAS) PERMOHONAN SEMAKAN KEHAKIMAN NO.: WA-25-60-02/2022 Dalam perkara mengenai Award bertarikh 29.12.2021 yang diberi oleh Tribunal Tuntutan Pembeli Rumah di Putrajaya dalam Tuntutan No. TTPR/W/1014/21; dan Dalam perkara mengenai permohonan Ujana Mutiara Sdn. Bhd. (No. Pendaftaran Syarikat: 1126138-A) untuk suatu Perintah Certiorari; dan Dalam perkara mengenai

Schedule

Jadual H Peraturan-Peraturan Pemajuan Perumahan (Kawalan & Pelesenan), 1989; dan Dalam perkara mengenai Seksyen 25(2) dibaca bersama Perenggan 1 dalam Jadual kepada Akta Mahkamah Kehakiman, 1964; dan Dalam perkara mengenai Seksyen 44 Akta Relief Spesifik, 1950; dan Dalam perkara mengenai Aturan 53 Kaedah-Kaedah Mahkamah, 2012. ANTARA UJANA MUTIARA SDN. BHD. (NO. PENDAFTARAN SYARIKAT: 1126138-A) ...PEMOHON DAN 1. TRIBUNAL TUNTUTAN PEMBELI RUMAH 2. CHEA CHEN NEE (NO. K/P: 760507-14-5586) 3. TAN CHEE KUAN (NO. K/P: 761226-10-5769) …RESPONDEN-RESPONDEN DIDENGAR BERSAMA DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN KUALA LUMPUR, MALAYSIA (BAHAGIAN KUASA-KUASA KHAS) PERMOHONAN SEMAKAN KEHAKIMAN NO.: WA-25-241-04/2022 Dalam perkara mengenai Award bertarikh 15.03.2022 yang diberi oleh Tribunal Tuntutan Pembeli Rumah di Putrajaya dalam Tuntutan No. TTPR/W/0007/22; dan Dalam perkara mengenai permohonanUjana Mutiara Sdn. Bhd. (No. Pendaftaran Syarikat: 1126138-A) untuk suatu Perintah Certiorari; dan Dalam perkara mengenai

Schedule

Jadual H Peraturan-Peraturan Pemajuan Perumahan (Kawalan & Pelesenan), 1989; dan Dalam perkara mengenai Seksyen25(2) dibaca bersama Perenggan 1 dalam Jadual kepada Akta Mahkamah Kehakiman, 1964; dan Dalam perkara mengenai Seksyen 44 Akta Relief Spesifik, 1950; dan Dalam perkara mengenai Aturan 53 Kaedah-Kaedah Mahkamah, 2012. ANTARA UJANA MUTIARA SDN. BHD. (NO. PENDAFTARAN SYARIKAT: 1126138-A) ...PEMOHON DAN 1. TRIBUNAL TUNTUTAN PEMBELI RUMAH 2. LEE SHET LEE (NO. K/P: 650804-10-7394) 3. LIM JIA XIN (NO. K/P: 930626-05-5670) …RESPONDEN-RESPONDEN JUDGMENT [1] This application for judicial review WA-25-60-02/2022 is consolidated with related cases in WA-25-58-02/2022, WA-25-65- 02/2022, WA-25-116-03/2022, WA-25-120-03/2022, WA-25-121- 03/2022, WA-25-123-03/2022, WA-25-128-03/2022, WA-25-130- 03/2022, WA-25-139-03/2022, WA-25-199-04/2022, WA-25-200- 04/2022, WA-25-202-04/2022, WA-25-203-04/2022, WA-25-204- 04/2022, WA-25-206-04/2022, WA-25-207-04/2022, WA-25-236- 04/2022, WA-25-237-04/2022, WA-25-242-04/2022, WA-25-243- 04/2022 and WA-25-326-04/2022, WA-25-398-06/2022. The remaining three related cases, WA-25-205-04/2022, WA-132- 03/2020 and WA-23-241-04/2022 are not consolidated. But the remaining three cases were heard together. [2] Parties agreed that JR No. 60 would be used as the anchor case for the purpose of these numerous applications for judicial review. JR No. 60 [3] This is an application for judicial review for an order of certiorari to quash an Award handed down by the Tribunal for Homebuyers Claims (“the Tribunal”), the 1st respondent, on 15.3.2022. [4] The claim brought by the 2nd and 3rd respondents at the Tribunal was in respect of the liquidated ascertained damages (“LAD”) for the alleged late delivery of vacant possession. [5] Leave to commence this judicial review application was granted by this Court on 14.6.2022. [6] The factual background of the case in JR No. 60 is as follows. [7] On 21.5.2018, the applicant as the developer and the 2nd and 3rd respondents as the purchasers entered into a sale and purchase agreement (“SPA”) in respect of the property known as Parcel No.12-01, Tingkat 12, Blok B, in a project known as The Hermington, Kuala Lumpur. The agreed purchase price was RM482,000. [8] Pursuant to cl 25 of the SPA, vacant possession ought to be delivered within 36 months from the date of the SPA. [9] Prior to entering into the SPA, the applicant company collected booking fees from the 2nd and 3rd respondents on 16.9.2017. [10] According to the applicant company, vacant possession was delivered to the 2nd and 3rd respondents on 29.10.2021, though this is disputed by the 2nd and 3rd respondents. [11] The 2nd and 3rd respondents then filed a claim for LAD at the Tribunal. At the Tribunal [12] The two issues before the Tribunal are as follows: (a) Whether the 36-month stipulated in cl 25 of the SPA is to be calculated from the date of the payment of the booking fees, which is on 16.9.2017 or the date of the SPA, which is on 21.5.2018. (b) The date of vacant possession. When does time start to run [13] On the first issue, the learned President of the Tribunal took cognisance of the 2nd and 3rd respondents’ reliance on the judgment of the Federal Court in PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah & Or Appeals [2021] 2 CLJ 441 FC. The 2nd and 3rd respondents contended that the calculation of the 36-month period should be from the date stated in the receipts of the booking fees. [14] There were two receipts issued by the applicant company, both dated 16.9.2017. The first is No. 03654 for the sum of RM10,000 “being payment of part of 1st 10%”. The second receipt is No. 04351, being payment of the balance of 1st 10%. [15] There were specific references to Unit B-12-01 in both receipts. [16] In his grounds of judgment, the learned President made the following findings: (a) The applicant company did not dispute the booking fees paid by the 2nd and 3rd respondents. (b) The applicant company, being a licensed developer, should not have collected any money from the 2nd and 3rd respondents until and unless a formal agreement is signed. The collection of the money from the purchaser could not be legalised by using creative labels such as booking fees or earnest deposit. (c) Reg 11(2) of the Housing Development (Control and Licensing) Regulations 1989 (“the 1989 Regulations”) prohibits any collection of money. The regulation provides that no housing developer shall collect any payment by whatever name except as prescribed by the contract of sale. (d) The only way that the applicant is allowed to collect the money is a formal contract entered by the parties. The SPA, particularly the Third Schedule, clearly states that the first 10% of the purchase price can only be collected upon signing the SPA. (e) Relying on PJD Regency and Daiman Development Sdn Bhd v Mathew Lui Chin Teck and Anor Appeal [1981] 1 MLJ 56 PC, the learned President was of the view that such payment has been considered sufficient to show the existence of a valid contract. (f) The learned President made a finding that the payment was meant to be utilised as part of 10% of the purchase price. In any event, the booking fees were later utilised as the 10% deposit payment under the SPA. (g) Citing PJD Regency, the learned President further held that the payment of the initial 10% deposit and the signing of the statutory SPA should have been done simultaneously. The applicant had bypassed the statutory prohibition against the collection of booking fees, which meant that a bargain was indeed made at the time of the payment of the booking fee. The initial payments were sufficient to constitute an intention to enter into a contract, given that the SPA would have to be signed at the same time. [17] The learned President then held that the 36-month period should be calculated from the date of the payment of the deposit of 10% in the form of the booking fees, which was on 16.9.2017. On the date of vacant possession [18] As to the date of vacant possession, the learned President referred to cl 27(2) of the SPA, which provides: The delivery of vacant possession by the Developer shall be supported by a certificate of completion and compliance and includes the handing over of the keys of the Parcel to the Purchaser. [19] The learned President took cognisance that the 2nd and 3rd respondents had adduced the Acceptance of Keys Form signed by the representative of the applicant company and dated 26.11.2021. [20] Under the circumstances, the learned President held that the date of vacant possession was on 26.11.2021. [21] The learned President took into account the implication of s 35 of the Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (COVID-19) Act 2020 (“COVID-19 Act”) and held that a total number of 167 days would be deducted from the calculation of the LAD. Findings of the Tribunal [22] Based on the aforesaid grounds, the learned President made the following Award: Oleh itu saya benarkan tuntutan sebanyak RM41,967.02 dibayar dalam tempoh 30 hari dari tarikh award, jika ingkar faedah pada kadar 8% setahun. Tuntutan lain ditolak. At the High Court [23] Aggrieved by the said Award (“the Impugned Award”), the applicant company commenced this application for judicial review to quash the same. [24] This application for judicial review is supported by the affidavit of Lee Chan Kuen in Encl 3 (“AIS-3”). Encik Lee is the Chief Operating Officer of the applicant company. [25] In para 23 of AIS-3, the applicant asserted that the learned Chairman had erred in law and acted illegally, in excess of jurisdiction, unreasonably, irrationally and took irrelevant matters into consideration: (a) in granting the Impugned Award, which implicitly provides that the period of 36 months to deliver vacant possession commences from the date of the 2nd and 3rd respondents’ payment of RM10,000.00 and/or RM14,100.00 and/or in failing to adequately consider and/or find that that the period of 36 months to deliver vacant possession commences from the date of the SPA; (b) in granting the Impugned Award, contrary to the clear, unambiguous provisions of, amongst others, cl 25 of the SPA; (c) In granting the Impugned Award, contrary to the clear, unambiguous provisions of cl 29 Schedule H of the 1989 Regulations; (d) In granting the Impugned Award, in circumstances where the formation and conclusion of a contract between the 2nd, 3rd respondents and the applicant took place on 21.05.2018 vide the SPA; (e) in granting the Impugned Award, in circumstances whereas at 16.9.2017: i. the 2nd and 3rd respondents’ offer had not been accepted; and ii. the SPA had not been executed by the Applicant. (f) in granting the Impugned Award, which implicitly provides that there was a valid and binding agreement upon payment of RM10,000.00 and/or RM14,100.00 by the 2nd and 3rd respondents to the applicant; (g) in failing to adequately consider or give effect to the provisions of the COVID-19 Act, in particular, s 35(1) and (2) for purposes of calculating the LAD; (h) in failing to adequately consider the impact of the COVID- 19 pandemic on the applicant and/or the manner in which the applicant’s performance of its obligations and liabilities pursuant to the SPA was affected owing to strict compliance with all applicable guidelines and standard operating procedures at the material time including, but not limited to, the Guidelines for the Practice of COVID-19 Preventive Measures Practice Guidelines on Construction Sites; (i) in granting the Impugned Award, thereby unjustly enriching the 2nd and 3rd respondents; (j) in granting the Impugned Award, thereby completely ignored the clear and express intentions of the applicant and the 2nd and 3rd respondents as to the manner in which the LAD is to be calculated, and thus disregarded the parties’ fundamental right to freedom of contract; (k) in granting the Impugned Award, the 1st respondent failed to consider that in law, such an award is tantamount to endorsing a penalty provision prohibited by s 75 of the Contracts Act 1950. [26] Before me, learned counsel for the applicant highlighted three main issues to be determined by this Court. They are as follows: (a) When is the starting date for the delivery of vacant possession? (b) The implication of the Minister’s exemption to the 36-month timeframe. (c) Deprivation of the right to be heard by the Tribunal in JR No. 139. The date for delivery of vacant possession [27] Learned counsel for the applicant submitted that the ratio in PJD Regency is premised on all of the foundations of a contract being present when the applicant received the 1st payment. Learned counsel’s understanding of PJD Regency is that where: (a) The parties; (b) The price; (c) The subject matter (i.e. unit, layout and description of the property); and (d) The legal obligation for the purchaser to purchase the property, are determined with finality, then the initial payment to a developer will result in a valid contract being formed. [28] Applying the said proposition to the instant case, learned counsel for the applicant submitted that the fundamental features or the terms of the contract had not been finalised or determined on the payment of the booking fees. For one, in some cases, the initial payments were made by the third parties and not the purchasers. [29] Learned counsel for the applicant cited Toh Ai Shi v Talent Team Sdn Bhd & Anor [2023] 7 MLJ 262 as an authority. In that case, the first payment was made to a third party and stranger to the SPA. According to learned counsel, this was sufficient for the learned Judge to distinguish PJD Regency. [30] Secondly, in all 27 cases, no legal obligation was placed on the proposed purchasers, requiring them to purchase the proposed units. Instead, according to learned counsel, the proposed purchasers filled in the Purchase Application Form to be accepted by the developer. Until and unless the developer accepts this Purchase Application Form, it is open to the proposed purchaser not to proceed with the purchase and secure a refund of the amount paid. [31] Thirdly, learned counsel for the applicant highlighted that 25 out of 27 proposed purchasers had instructed their respective solicitors to hold the SPA in escrow pending confirmation and acceptance by the applicant as the developer. The escrow letter inter alia authorised the solicitors to hold the signed SPA in escrow pending “confirmation by the Developer in regard to the execution of the Sale and Purchase Agreement by them and stamping thereafter”. Learned counsel submitted that this goes to show the purchasers had taken an additional step to defer the formation of a contract by placing the SPA in escrow with the purchasers’ solicitors. [32] As alluded to by its learned counsel, the applicant's position is that a contract can only be formed when the terms are agreed with sufficient certainty; MN Guha Majumder v RE Donough [1974] 2 MLJ 114. In short, according to learned counsel for the applicant, if the terms are unsettled or indefinite, there will be no contract. The implication of the Minister’s exemptions [33] Learned counsel for the applicant further submitted that even if the date starts to run from the payment of the booking fee on 16.9.2017, the applicant would still be well within the 36-month timeframe. [34] It is the applicant’s case that the Minister of Local Government had granted the applicant an exemption and specifically excluded: i. 122 days; and ii. 365 days. These exemptions are in addition to the 167 days granted under the COVID-19 Act and the 36 months stipulated under the SPA. [35] The applicant contended that if we take this into account, and time starts to run from 16.9.2017, the date of vacant possession ought to be delivered would be 2.7.2022. Since the applicant’s position is that the date of vacant possession was 29.10.2021 (though the learned President held it to be 26.11.2021), the questions of late delivery and LAD do not arise. Deprivation of the right to be heard – JR No. 139 [36] In so far as JR No. 139 is concerned, learned counsel raised the issue that the Impugned Award ought to be quashed as the Tribunal delivered its decision in spite of the fact that the time limited for the filing of Defence has not lapsed as at the date of hearing on 30.12.2021. The 2nd respondent in this case is Lai Khee Fatt. [37] According to learned counsel, Form 1 was only served on the applicant on 20.12.2021, although this is disputed by the 2nd respondent. During the hearing on 30.12.2021, the applicant’s representative sought for the hearing to be adjourned as the Defence had not been filed. Unfortunately, the Tribunal denied the applicant’s request for an adjournment and proceeded to deliver its decision. [38] The applicant’s position is that the applicant ought to be given the 14-day period specified under reg 10(1) of the Housing Development (Tribunal for Homebuyer Claims) Regulations 2002 (“2002 Regulations”). It provides as follows: If the respondent who has been duly served with Form 1 disputes the claim, he shall deliver his defence in Form 2 within fourteen days after the service of the statement of claim. [39] Since the Tribunal had failed to exercise its discretion to adjourn the hearing and give the applicant an opportunity to file its Defence, the applicant’s contention is that the Tribunal had committed a breach of natural justice that is amenable to judicial review. [40] For the reasons aforesaid, learned counsel for the applicant urged this Court to conclude that the Impugned Award was tainted with illegality, irrationality, unreasonableness and procedural impropriety that made it reviewable by this Court. Analysis [41] Learned counsel for the applicant invited me to conclude that the Tribunal’s reliance on PJD Regency was misguided. [42] The applicant’s contention is that in PJD Regency, the ratio was premised on the foundations of a contract being present when the first payment was made by the purchasers to the developer. While learned counsel did not dispute the ratio in PJD Regency, her line of argument is that no such contract was concluded on 16.9.2017. [43] Citing Daiman Development as an authority, learned counsel for the applicant submitted that the purchasers and developer had not been determined with finality at the time of the payment of the booking fee. The extension of the argument is that the dramatis personae, the parties to the contract, must have been clearly identified before one can conclude that the payment was made as part of the 10% deposit referred to in the SPA. [44] Learned counsel, therefore invited me to distinguish the instant case (and other remaining cases) with PJD Regency. In short, since there is no finality, no initial payment to the developer will result in a valid contract being formed. This is so since it is open for the purchaser to secure a refund of the amount paid. [45] With respect, I do not find this line of argument to be persuasive. As held by the High Court in EUPE Bangsar South Development (JV) Sdn Bhd v Lam Sai Yih [2023] 1 CLJ 194, the status of the refundability of the booking fee is of no consequence. It is settled law that the calculation of LAD must be from the date of payment of the booking fee, however it is described or whatever its refundability status is, instead of from the date of the SPA. [46] In any event, even if a contract is concluded, it does not prevent a party from obtaining a refund from the other party in the event of a breach. [47] As to in some cases, where the initial payments were made by the third parties and not the purchasers, learned counsel for the applicant relied on Toh Ai Shi to highlight her point that there is no certainty in the contracting parties. What are the facts in Toh Ai Shi? With respect, the facts are materially different from the instant case. In that case, unlike in the instant case, there was never any booking form. The purported “booking form” claimed by the purchaser was merely a receipt from Messrs Soh Hayati & Co to the purchaser. The receipt clearly stated that the sum of RM5,000 was made “being payment of stakeholder sum”. There was no mention of any booking fee as in the instant case. Since the payment was made to the solicitors as a stakeholder, it was not a booking deposit that was paid to the developer’s pocket. [48] In contrast, the booking fees paid by the 2nd and 3rd respondents in the instant case were in the applicant's account and remained as part of the first 10%. This was clearly stated in the receipts issued by the applicant. [49] Toh Ai Shi is, therefore, distinguished. [50] By the same token, the instructions issued by certain purchasers to their respective solicitors to hold the SPA in escrow pending confirmation and acceptance by the applicant as the developer did not alter the fact that money has changed hand to the applicant’s account. On the authority of PJD Regency, for the purpose of determining the LAD, the reference completion period ought to be calculated from the date of the booking fee payment. The developer could have delayed the preparation of the SPA or its execution. The purchaser could have instructed his solicitor to hold the SPA in escrow. All these do not alter the legal proposition that the date starts to run from the payment of the booking fee. [51] In any event, as held by the learned President, the details in the receipts issued by the applicant are sufficient to identify the unit and the purpose of the payment. A contract was therefore concluded. [52] On the issue of the Minister’s exemptions, two relevant facts should be highlighted. First, while it is not disputed that the applicant obtained the 122-day and 365-day exemptions, they were granted after the 2nd and 3rd respondents took vacant possession and filed LAD claims at the Tribunal. [53] Secondly, the applicant should have pleaded the purported 2. Ministerial exemptions in its Defence before the Tribunal in Borang I have gone through Borang 2 in Exh LCK-11, and save for the averment on the exemption under s 35 of the COVID-19 Act, which the learned President accepted, there was no mention of the purported Ministerial exemptions, let alone for the number of 122 and 365 days mentioned by the applicant. [54] The Federal Court in Ranjit Kaur v Hotel Excelsior (M) Sdn Bhd [2010] 8 CLJ 629 FC held that: However, as rightly pointed out by learned counsel for the respondent s 30(5) of the Act cannot be used to override or circumvent the basic rules of pleading. The Industrial Court, like the civil courts must confine itself to the four corners of the pleading. [55] There is an exception to this rule. It is this. Where a matter or material facts are not pleaded but the evidence is led without objections at the hearing, the court, in this case, the Tribunal, is duty bound to consider such evidence, although it may be a departure from the pleading. If any authority is needed for the aforesaid proposition, it can be seen from the judgment of the Federal Court in Iftikar Ahmed Khan v Perwira Affin Bank Bhd [2018] 1 CLJ 415 FC. [56] I have also gone through the notes of proceedings in Encl 15, and I do not find any reference to the Ministerial exemptions made by the applicant’s representatives at the hearing before the Tribunal. In short, the Ministerial exemptions, if at all, were not only not pleaded but also no evidence was led to establish the fact at the hearing. [57] The applicant comes to this Court for me to review the Award made by the Tribunal. In short, the applicant is saying that the Tribunal had committed an error that made its decision reviewable. If, on the other hand, the Tribunal is not appraised of the material fact on the purported Ministerial exemptions either in Borang 2 or at the hearing, how could we conclude that it had committed an error justifying a curial intervention? [58] It is patently unfair to challenge the decision of the Tribunal based on unpleaded averments, for which evidence was not even adduced at the hearing. The law in judicial review, as I alluded to earlier, prohibits the inclusion of new facts, which has the consequence of changing the goalposts unless it comes within the exceptions outlined by Dunn LJ in R v Secretary of State for Environment & Anor, ex p Powis [1981] 1 WLR 584 CA. I do not find any of the exceptions applicable here. [59] For the aforesaid reasons, I cannot respectfully accede to the submission by learned counsel for the applicant for me to consider the Ministerial exemptions. JR No. 139 [60] As to the issue that there was a breach of the principles of natural justice in JR No. 139, the 2nd respondent, Encik Lai, in para 17 of his affidavit in reply in Encl 15 (“AIR-15”), asserted that he had served Borang 1 on the applicant on 17.12.2021. Even if this is true, the applicant has until 31.12.2021 to file its Defence in Borang 2 under reg 10(1) of 2002 Regulations. [61] Unfortunately, the hearing was held on a day before the last day that the applicant is permitted to file its Defence. [62] The Tribunal had, therefore, committed a breach of the principle of natural justice by denying the applicant the right to be heard. The Supreme Court in Shamsiah bte Ahmad Sham v Public Services Commission [1990] 3 MLJ 364 SC held that the 1st respondent had infringed the rule of natural justice in not affording the appellant the opportunity to explain or controvert her record of service, which played a part in influencing its decision to impose the severest punishment permissible. [63] In the instant case, the situation is more severe since the Tribunal had acted against the clear provision of reg 10(1) of the 2002 Regulations. That is a clear case of procedural impropriety. [64] I have gone through the notes of proceedings in Encl 19 and take cognisance that the learned President did not even address the issue of pleadings or whether the applicant had any counterclaim against the 2nd respondent when the applicant had one more day before the close of the pleadings. There was no opportunity given to the applicant at all. [65] This calls for curial intervention. Findings [66] Except for JR No. 139, these applications for judicial review are dismissed. The Impugned Award is not tainted with any illegality, irrationality, unreasonableness or procedural impropriety that made it reviewable by this Court. [67] An order of certiorari is hereby issued to quash the Award of the Tribunal in JR No. 139, which is tainted with procedural impropriety and breach of the principles of natural justice. [68] There shall be no order as to costs. Tarikh: 8 Mac 2024 (WAN AHMAD FARID BIN WAN SALLEH) Hakim Mahkamah Tinggi Kuala Lumpur. Pihak-pihak: Bagi Pihak Pemohon : Loh Suk Hwa Tetuan Joshua Aaron Keet Bagi Pihak Responden : Harneshpal Singh & Parvinder Kaur JR No. 58, 60, 65, 116, Tetuan Parvin & Co. 120, 121, 123, 128, 130, 139, 199, 200, 202, 203, 204, 206, 207, 236, 237, 242, 243, 326 and 398 JR No. 61 : Sabrina Rusdi Tetuan Tay Chai Huat & Co. JR No. 241 : Sandra Lee Yen Peng Tetuan Azwar & Associates JR No. 132 : Chuah Kim San In person JR No. 205 : Kong Juan Jian In person