Can the government grant an extension of time to developer to hand over vacant possession of condominium units contrary to the terms of the sale and purchase agreement?
MENTERI KESEJAHTERAAN BANDAR, PERUMAHAN DAN KERAJAAN TEMPATAN & ANOR V ANG MING LEE & ORS AND OTHER APPEALS  6 MLRA 463
- BHL Construction Sdn Bhd (“Developer”) is the developer of a project to build a condominium (“Condo”).
- Ang Ming Lee and others were purchasers of units in the Condo (“Purchasers”).
- The sale and purchase agreements (“SPAs”) between the Developer and the Purchasers stipulate that the time period for delivery of vacant possession of the units in the Condo shall be thirty-six (36) months from the date of signing of the SPAs.
- The Developer had applied for an extension of time for delivery of vacant possession to the Controller of Housing of the Ministry for Urban Wellbeing, Housing and Local Government (“Controller”) pursuant to regulation 11(3) of the Housing Development (Contol and Licensing) Regulations 1989.
- The Controller rejected the Developer’s application for extension of time and the Developer appealed to the Minister for Urban Wellbeing, Housing and Local Government (“Minister”) in accordance with Regulation 12.
- The Developer claimed that the Minister had approved its appeal for extension of time by its letter dated 17 November 2015, granting an extension of twelve (12) months.
- There was a delay in the completion of the Condo and the Developer became liable to pay damages to the Purchasers for late delivery of the Condo.
- However, the decision of the Minister in allowing the extension of time removed the Purchasers’ right to claim for damages.
- The Purchasers therefore filed an application in Court to quash the decision of the Controller/Minister which amended the time period of delivery of vacant possession from thirty-six (36) months to forty-eight (48) months.
- The High Court granted the application on the main basis that Regulation 11(3) was ultra vires Housing Development (Control and Licensing) Act 1966 (the “Act”).
- The Developer appealed to the Court of Appeal.
COURT OF APPEAL DECISION – EXTENSION OF TIME NOT ALLOWED!
The Court of Appeal did not allow the appeal for extension of time for the following reasons:
- The Controller had the power to exercise his discretion as granted under Regulation 11(3) which the Controller had exercised in rejecting the Developer’s application for extension of time.
- However, the Court found that the letter purportedly from the Minister dated 17 November 2015 granting the appeal for extension of time was not valid.
- The Court ruled that the letter dated 17 November 2015 which should have been signed by the Minister was actually signed off on behalf of the Controller.
- So, the Court ruled that the appeal from the decision of the Controller was decided by the Controller himself and not by the Minister, in contravention of Regulation 12 which provides that any appeal to the decision of the Controller shall be made to the Minister whereupon the decision of the Minister is final and shall not be questioned in any court.