Amended law is more protective of house buyers
NST - 14/11/2002: WE refer to L.C.F.’s letter (NST, Nov 7, 2002) and we
sympathise with the problems that his son is facing after being told to
take possession of his house.
On his refusal to take over the house due to a leaking roof, flooding in
certain parts of the house and warping of the parquet, we have this to
say.
The Housing Developers' Act, 1966, Schedule G (this is the stipulated
standard Sales and Purchase Agreement for landed properties) Clause 21 (2)
and Schedule H (this is the stipulated standard Sales and Purchase
Agreement for Subdivided buildings) Clause 23 (2) both state: "Upon the
expiry of 14 days from the date of a notice from the Vendor requesting the
Purchaser to take possession of the said property, whether or not the
Purchaser has actually entered into possession or occupation of the said
Property, the Purchaser shall be deemed to have taken delivery of vacant
possession." Hence there is no question as to whether L.C.F.'s son wants
to take vacant possession of the house. Fourteen days after being notified
by the Vendor, he is deemed to have taken over the house whether he likes
it or not. Ridiculous? Yes, but that's exactly the situation as stipulated
by the Housing Developers' Act 1966.
Based on this clause, certain developers are forcing house buyers to take
over vacant possession even before the Certificate of Fitness for
Occupation (CFO) is issued.
Perhaps one can now see why certain cynical remarks were made that the Act
is indeed the Housing Developers' Act because it was designed to benefit
housing developers at the expense of house buyers. For more details on the
subject of the mystical CFO, please surf our website: http://
www.hba.org.my.
Yes, irresponsible developers will play a game of patience with their
buyers. They keep delaying defect rectification work until the buyers run
out of patience and rectify the defects themselves.
However, Clause 23 of the Act also states that after 30 days written
notice of any defect and if the developer still does not make good the
defect: "The purchaser shall be entitled to recover from the Vendor the
cost of repairing and making good the same and the Purchaser may deduct
such costs from any sum which has been held by the Vendor's solicitor as
stakeholder for the Vendor.
"Provided that the Purchaser shall, at any time after the expiry of the
said period of 30 days, notify the Vendor of the cost of repairing and
making good the said defects, shrinkage or other faults before the
commencement of works and shall give the Vendor an opportunity to carry
out the work himself within 14 days from the date the purchaser has
notified the Vendor of his intention to carry out the said works." The law
seems very clear about what the Purchaser can do to seek rectification to
the defects in his house while under the defect liability period. But we
have reservations when it comes to practical implementation. For one, the
stakeholder who is holding the five per cent of purchase price is the
developer's solicitor, not the Purchaser's. And he knows full well who is
paying him! However, L.C.F. can take consolation that the amendments to
the Housing Developers' Act 1966 have been gazetted on Jan 31, 2002. For a
start it is no longer called the Housing Developer's Act but is now called
The Housing Development (Control and Licensing) Act revamped 2002. The
amended Act is certainly more protective of house buyers although there
are some clauses that can still be exploited by errant developers. We are
anxiously awaiting our Minister of Housing and Local Government to
announce its implementation.
CHANG KIM LOONG
Secretary-General
National House Buyers Association, Malaysia
