Just to share the info with memember sekapal. This is a recent Court decision in relation to your right as a purchaser in a Sale & Purchase Agreement.

Case : Tan Sri G Darashan Singh v Loke Kee Development Sdn Bhd & Anor (2009) 7 MLJ 157

In this case, plaintiff purchased a condominium unit from the 1st Defendant. The 1st Defendant failed to complete the project within the time frame i.e 36 months and the project was abandoned. The plaintiff had fully paid the purchase price. The 1st Defendant then appointed another company to revive the project and in the agreement between the two company also provides the 1st Defendant were procuring waivers from the purchasers for the LAD at the rate of 10% per annum as they were entitle to under the sale agreement. In the agreement, the 1st Defendant will also be liable to late payment interest. The project was completed by 2nd Defendant and delivered to the plaintiff.

The plaintiff claimed for LAD from the 1st and the 2nd Defendants as he had never agreed to waive his rights to the LAD. The 1st Defendant argued on financial crisis in 1997 which caused the project to be abandoned and the fact that the Plaintiff had made no complaint of 2nd defendant continuing the project amounted to acquiescence.

The court rejected the 1st Defendant argument and referring to Housing Developers (Control and Licensing) Regulations 1989 and HELD as follows:-

The 1st Developer cannot vary or modify any clause in the sale agreement without approval from the Controller of Housing as the terms in the sale agreement were prescribed by statute and furthermore application cannot be made after the expiry of time of delivery of vacant possession. The financial crisis or the appointment of 2nd Defendant did not exempt the 1st Defendant from its statutory obligations to pay the LAD to the Plaintiff. It also held that the 2nd Defendant was not liable to the Plaintiff.

From this case, we highlight the 2 important points as follows:-

Developers cannot simply change or modify the terms of the Sale & Purchase Agreement which you've already signed without first applying to the Controller of Housing and such application can ONLY be made in special circumstances.. Even if you had given your consent to waive, in the absence of the Developer having made the application to the Controller of Housing, your consent is not valid.

The is because the terms and conditions of the Sale & Purchase Agreement are imposed under the Housing Developers (Control and Licensing) Regulations 1989 and no changes can be made without approval from the relevant authority.

The developer cannot run from its responsibilities from paying LAD to the purchasers even when the project was abandoned due to economic crisis. Therefore, do make sure claims are made to the developers as per the Sale & Purchase Agreement once the property has been handed over to you.