LIMMEWAH DEVELOPMENT SDN BHD V. DR JASBIR SINGH S/O HARBHAJAN SINGH

GROUNDS OF JUDGMENT

By agreement (the contract) made on the 15th day of September 1981, the appellant who was a housing developer (the Developer) contracted with the respondent (the Buyer) to sell the Buyer a bungalow. The contract was governed by the provisions of The Housing Developers (Control and Licensing) Act, 1966 (the Act) and was in the form prescribed by the Rules thereunder. The contract provided inter alia for the purchase price to be paid by instalments and at times, as were set out in a schedule attached thereto, in default the Buyer to pay interest on the sum due and unpaid, the bungalow to be completed and ready for delivery of possession to the Buyer within a certain time if not the Developer was to be liable to pay the Buyer liquidated damages calculable as stipulated in the contract.

The Buyer was a government servant. He made an application to the Government for a loan to buy the bungalow. The Developer knew about this. In fact the Developer had executed a document addressed to the Secretary (the Secretary), Housing Loan Division, Treasury, Malaysia, in reference to the Buyer's application, wherein particulars of the title to the land on which the bungalow was to be built were given together with the price of the land and bungalow, the deposit paid and the balance purchase price payable whereafter in the said document the Developer agreed to transfer the ownership of the land to the Buyer immediately the cost of the land had been settled, charge the same and deliver title thereto to the Government and accept a schedule of progress payments stipulated by the Government (the Government's schedule of payments).

The Buyer claimed the liquidated damages, pleading the Developer's failure or refusal to deliver vacant possession of the bungalow within the contracted time. The Buyer made a further claim of $6,000.00 pleading that the Developer knowing that the Buyer was away in the United Kingdom began harassing the Buyer to pay interest and collect the keys to the bungalow which allegedly was far from completed, resulting in the Buyer, as the Buyer claimed, having to return to Malaysia twice at a cost of $6,000.00.

The Buyer also claimed damages for pain, anxiety, distress and humiliation.

The Developer in its defence denied the Buyer's claim, alleging that on 16 January 1983 the Certificate of Practical Completion was given by the architect and that on 5 February following the Developer had given the Buyer notice by letter that the bungalow was ready for vacant possession. The Developer pleaded that it was the Buyer that delayed the scheduled instalment payments and counterclaimed interest for late payment as provided for in the contract.

The Buyer's defence to the counterclaim was that the schedule of payments and imposition of interest on overdue payments in the contract were varied in writing, as evidenced by the appellant having accepted the Government's schedule of payments, that having accepted the Government's schedule of payments the appellant had waived payment according to and was estopped from relying on the schedule of payments and terms governing payment of interest provided in the contract, that if there was any delay in payment of the purchase price it was caused by the Developer in failing to comply with the requirement of Government relating to completion of the bungalow and transfer of the land to the Buyer.

A trial ensued before the learned Magistrate (the Magistrate) who after hearing witnesses and considering the evidence found for the Buyer on his claim for liquidated damages, but not on his other claims, and dismissed the counterclaim. The Magistrate set out five issues and made express findings in regard to each of them as follows: Firstly, the date for completion and delivery of possession of the bungalow to the Buyer was 25 August 1981, secondly, the date of delivery of vacant possession of the bungalow to the Buyer was 16 January 1985, thirdly the Developer was bound by the Government's schedule of payments as well as the schedule in the contract, fourthly that the Buyer's claims for $6,000.00 and damages for pain, anxiety, distress and humiliation were not allowed by reason of the decision in S.E.A Housing Corporation Sdn. Bhd. v. Lee Poh Choo [1982] 2 M.L.J. 31, and fifthly that the Developer was estopped from claiming interest for late payment based on the decision in Regina Navamoney D/O D.T. Periathamby v. Joseph Varghese [1987] 1 C.L.J. 68 and section 115 of the Evidence Act 1950. The Magistrate also found that there was delay on the part of the Developer in transferring the title to the Buyer and charging the land to the Government which delay was caused by there being a caveat lodged against the same.

Both the Developer and the Buyer were aggrieved by the decision of the Magistrate and appealed and cross-appealed respectively to this Court. By consent counsel filed written submissions in the appeal.

As to the first finding of the Magistrate counsel for the Developer in his submission (the Submission) conceded that the date for completion and delivery of vacant possession of the bungalow was 25 August 1981.

As to the Magistrate's second finding which was one of fact, the onus was on the Developer to establish before this Court that the finding was perverse or plainly wrong. See Mulkh Raj Sharma v. Shanti Sroop [1983] 2 M.L.J. 396 a decision of the Federal Court. The Developer could have done so, for example, by demonstrating that there was no evidence upon which such a finding of fact could be made. The Developer failed completely to discharge that onus. Such being the case it was not open to this Court to disturb the finding. In truth a perusal of the record disclosed ample evidence upon which the Magistrate was able to make his finding. The Buyer had testified to delay in completion of the bungalow, failure on the part of the Developer to transfer title to the land by reason of a caveat and failure or refusal of the Developer to give possession of the bungalow including requests by the Buyer's solicitors for such possession and that it was only on 16 January 1985 that possession was given. The Buyer's testimony corroborated the evidence of an officer from the Government who had earlier testified to delay on the part of the Developer in completing the bungalow, transferring title and charging the land to the Government. A third witness namely the Buyer's solicitor testified to repeated demands in writing for delivery of possession of the bungalow which demands were not met. The Magistrate made express reference to this witness saying that it was on 16 January 1985 that the key was received by the solicitor. The Magistrate properly observed that the evidence of the solicitor was not challenged by the Developer. That being the case it is not surprising that the Magistrate accepted the evidence of the solicitor. See the decision of Raja Azlan Shah, C.J., now D.Y.M.M. Yang DiPertuan Agong in Wong Swee Chin v Public Prosecutor [1981] 1 M.L.J. 212 at page 213.

Then it was argued on behalf of the Developer relying on the case of Kanching Realty Sdn. Bhd. v. Leong Kok Chin & Anor. [1990] 1 C.L.J. 1144 that the Magistrate should have decided when the bungalow was completed and ready to be delivered and not when vacant possession was given to the Buyer. I do not agree. It is elementary law that every case must be decided on its own facts. In the Kanching case the learned Judge found that the developer should have completed the house and had it ready for delivery of vacant possession on 1 April but only had it so ready in October following and accordingly the Judge held the developer liable to pay liquidated damages to the buyer for the period of delay between April and October. That was not the case in this instance where it would appear that the bungalow was finally ready sometime in October 1984 but the Developer failed or refused to deliver possession till 26 January 1985. It was not just a question of the Developer having the bungalow ready for delivery of vacant possession. Coupled with that obligation was a requirement on the part of the Developer to deliver vacant possession to the Buyer. There was no question of the Buyer entering into possession of the bungalow on his own and without reference to the Developer. Such a course would have amounted to the Buyer taking the law into his own hands, a course of conduct which is to be discouraged.

As to the Magistrate's third finding it was conceded in the Submission that the Developer had agreed to the Government's schedule of payments. Yet it was argued that the Developer's obligation was to complete the works as stated in the contract and not as stated in the Government's schedule of payments and a number of reasons was submitted by counsel for the Developer. Those reasons were considered but with respect it is not necessary to refer to them. Suffice it to say that the learned Magistrate rightly followed the decision in Regina Nevamoney's case which I do respectfully adopt and follow. There is ample authority to indicate that the Act was passed to protect buyers, often individuals with limited financial resources, from victimisation by developers who usually have far more financial resources than the buyers. It was stated by Suffian L.P. in the S.E.A. Housing Corporation case that a developer cannot contract out of the obligations placed upon him by the Act and regulations made thereunder. Thus the Developer whilst free to bind himself to terms outside the contract such as the terms imposed by Government in this case was not free to do so in breach of the Developer's obligations under the contract. Accordingly it seemed to me that the Developer was duty bound either to fit whatever he undertook outside the terms of the contract within his obligations under the contract or alternatively, independently of such undertakings, the Developer should have honoured his obligations under the contract and having done so then gone ahead to seek payment or other remedy flowing from that which he so undertook.

In any event it was conceded in the Submission that as at 25 August 1981 the date for completion and delivery of vacant possession the glass doors, pipes and basins were not fitted and the drains were not done. That being the case it cannot be seen how it can be argued that the bungalow was completed and ready for delivery of vacant possession on the completion date. The reason given for non completion was that these items were likely to be vandalized or stolen. To my mind, that was not a legally binding reason for not fulfilling the Developer's obligation under the agreement. The Developer could easily have saved the situation by employing a watchman to guard its housing development. Then it was argued that the Developers' architect had in evidence given an undertaking to install these fittings as soon as the Buyer moved in promising that the installation could be done in one day. Again in my view there was no legal obligation on the part of the Buyer to accept the undertaking and assurance.

It had to follow that the Developer's appeal against the second, third and fifth findings of the Magistrate had to fail.

As to the Magistrate's fourth finding, it seemed to me that the Magistrate was perfectly right in following the S.E.A. Housing Corporation case where at page 35 it was said in regard to the contractual provision for damages for delay by the developer in delivery of vacant possession of a house, that such provision was intended to be comprehensive and precluded the purchaser from recovering under any other head damages in the event of delay in delivery as happened there. Thus in this case the Buyer was entitled only to the liquidated damages provided for in the contract and nothing else. It had to follow that the Buyer's claim for $6,000.00 and damages for pain and so on was bound to fail and the Magistrate was again right in disallowing the same.

For the reasons above stated, the appeal and the cross-appeal are both dismissed with costs, to be taxed.