Federal Court: Controller of Housing has no power to grant extension of time for housing development projects
27 November 2019
On 26 November 2019, the Federal Court delivered a landmark decision in Ang Min Lee & 34 Ors v Menteri Kesejahteraan Bandar, Perumahan dan Kerajaan Tempatan & Anor and Other Appeals in which it ruled that the Controller of Housing (‘Controller’) has no power to grant an extension of time for a housing developer to complete a housing development project.
In this case, the purchasers of condominium units in a project known as the Sri Istana Condominium in Kuala Lumpur had challenged the validity of a 12 months extension of time from 36 months to 48 months granted by a named individual, purportedly on behalf of the Controller, to the developer, BHL Construction Sdn Bhd, to complete the project.
In allowing the purchasers’ appeal, the apex court of Malaysia held that regulation 11(3) of the Housing Development (Control and Licensing) Regulations 1989, which confers power on the Controller to waive or modify the provisions of a prescribed contract of sale between the developer and a purchaser if the Controller is satisfied that owing to special circumstances or hardship or necessity it is impracticable or unnecessary to comply with the provisions of such contract, was void as it was ultra vires the Housing Development (Control and Licensing) Act 1966.
The learned Chief Justice, Tan Sri Tengku Maimun Tuan Mat, said that the modification and granting of extension of time to the housing developer did not appear to protect or safeguard the purchasers but rather the developer and militates against the intention of Parliament.
A more detailed write-up will be issued in due course.
Summary prepared by Oon Hooi Lin, a Partner in the Real Estate and Banking and Finance Practice Groups of Skrine.