Federal Court rejects Purchasers’ Leave Application in Bludream City

The Court of Appeal in Bludream City Development Sdn Bhd v Kong Thye & 184 Others [2022] 2 MLJ 241 held, inter alia, that: 
  1. the powers of the Minister of Urban Wellbeing, Housing and Local Government (now redesignated Minister of Local Government Development) (‘Minister’) to “regulate and prohibit the conditions and terms of any contract” between a licensed housing developer and a purchaser under section 24(2)(e) of the Housing Development (Control and Licensing) Act 1966 (the ‘Act’) is wide enough to include the power to “waive and modify” any provisions, including to grant an extension of time  under Regulation 11(3) of the Housing Development (Control and Licensing) Regulations 1989 (the ‘Regulations’) with respect to the time period to complete the housing unit; and 

  2. there is no express requirement under the Act for the purchasers, whether individually or collectively, to be given a right to be heard before the Minister grants an extension of time; in light of the observation of the majority judges in the Federal Court’s decision in Maria Chin Abdullah v Ketua Pengarah Imigresen & Anor [2021] 1 LNS 7, it suffices that the Minister acts fairly and takes into consideration the interest of the purchasers whose rights he is entrusted under the Act to safeguard. 
In coming to its decision on the ground set out in paragraph 1 above, the Court of Appeal clarified that the Federal Court’s landmark decision in Ang Ming Lee & Ors v Menteri Kesejahteraan Bandar [2020] 1 MLJ 281 decided that the Minister cannot delegate his powers under the Act to grant an extension of time to a developer to complete the units in a housing development to the Controller of Housing (‘Controller’) and did not decide that the Minister does not have the power to grant such extension of time under the Act.
The purchasers sought leave to appeal to the Federal Court on the following questions: 
  1. Whether the Minister is required to afford a right to be heard to the affected party, in this case the purchasers, before making a decision under Regulation 12 of the Regulations, and 

  2. Where the Controller’s decision is null and void by reason of Regulation 11(3) of the Regulations being declared ultra vires, whether the Minister’s decision made under Regulation 12 of the Regulations arising from an appeal against the said decision of the Controller is also null and void? 
In relation to the second leave question, it is pertinent to note that the Minister’s decision to grant a 17-month extension arose from the developer’s appeal against a decision by the Controller granting only a 12-month extension. Hence, the question as to whether the Minister’s grant of an extension is null and void as it arose from an appeal against a decision by the Controller that is ultra vires.
It has been reported on 4 January 2023 that the Federal Court has by a unanimous decision of a three-judge bench, dismissed the purchasers’ application for leave to appeal to the Federal Court on both questions of law as the application did not pass the threshold under section 96 of the Courts of Judicature Act 19641 which, inter alia, permits civil appeals to the Federal Court only if they involve a question of general principle decided for the first time, or a question of importance upon which further argument and a decision of the Federal Court would be to public advantage.
The Federal Court’s dismissal of the purchasers’ application for leave to appeal brings closure to the Bludream City case.
To read our case note on the Court of Appeal’s decision, please click here.
Alert by Jocelyn Lim Yean Tse (Partner) of the Construction and Engineering Practice of Skrine.

1 Apex Court: Minister has power to grant housing developers time extension to deliver vacant possession, theedgemarkets.com, 4 January 2023.

This alert contains general information only. It does not constitute legal advice nor an expression of legal opinion and should not be relied upon as such. For further information, kindly contact skrine@skrine.com.