In a muddle over Tribunal award
NST-PROP 11/09/2004

GETTING into a legal muddle is not what the average house buyer bargains for, after having spent so much of his hard-earned money on the unit, and paying substantial sums as legal fees and stamp duties as well.

This is why one group of financially aggrieved buyers is sore with the Government, and with the Tribunal for Homebuyer Claims, for being dragged to court on points of law - arising from its success before the Tribunal.

Members of this group - 42 in all - have been named as respondents in a challenge to the Tribunal's award of sums ranging from RM1,000 to RM4,000, handed down in the middle of last year, to 507 apartment buyers in Jinjang Utara, Kuala Lumpur, for the late delivery of their units by Fadason Holdings Sdn Bhd.

However, the developer did not make the payments. Instead, Fadason and another developer challenged the Tribunal's right to hear disputes arising from Sale and Purchase Agreements (SPAs) signed before it came into being on Dec 1, 2002.

The decisive ruling on its powers came on June 14 this year when the Federal Court declared that the Tribunal is empowered to hear all disputes related to SPAs between house buyers and developers brought before it.

This decision of the nation's highest judicial body, said National House Buyers Association Malaysia (HBA) secretary-general Chang Kim Loong, does not seem to satisfy some developers.

"Some developers will abuse the legal process by deliberately appealing on all rulings against them, not for anything else but to buy time to further frustrate the complainants of their entitlement," he said.

The High Court will on Sept 29 in KL hear Fadason's bid to quash the Tribunal's award to the apartment buyers on grounds that:

* There was an error in the calculation of the liquidated ascertained damages. This is on grounds that the Tribunal worked out compensation for late delivery from the date the buyers paid the deposits, not from the dates on which the SPAs were signed; and
* The buyers did not have locus standi to initiate action against Fadason. This is because their properties had been mortgaged to the banks that provided loans for the purchase and they did not have the consent of their bankers for the action.

Said Chang: "Here we see a dilemma where the aggrieved and financially spent buyers who sought redress through the Tribunal have been unwittingly dragged into the legal muddle.

"The Government, by setting up the Tribunal, sought to provide an affordable and more readily accessible avenue for aggrieved house buyers to seek redress from developers. The last thing buyers want is to be involved in court cases, chasing developers for their money."

He added that buyers should not be made to suffer more than what they were going through.

As a matter of public interest, Chang said, a team of lawyers has come forward offering time and expertise to represent the 42 buyers pro bono in the matter.