After a span of 11 months of trial, the Shah Alam Sessions Court today delivered a decision in favour of our Clients in our Clients’ claim for liquidated and ascertained damages (LAD) stemming from late delivery of vacant possession of purchased property in the Empire City @ Damansara (Project) against the developer (Defendant) (“Dispute”).
Our Clients are joint-purchasers of a SOHO-Office-Loft Office at Tower M of the Project (“Purchased Property”) whereby they have entered into a sale and purchase agreement (“SPA”) with the Defendant for the Purchased Property.
The plank of the Dispute lies in the “form” of the SPA given that the SPA signed by parties is a commercial SPA instead of a statutory one i.e. Schedule H SPA.
In this regard, we argued that the Defendant ought to use Schedule H SPA (and consequently, LAD ought to be calculated as if the SPA entered is a Schedule H SPA) because:-
(i) the Purchased Property, SOHO stands for “small office home office” whereby it can be used partly for human habitation (living purposes) and partly for business premises;
(ii) Given such nature, the Purchased Property fulfills the definition of “housing accommodation” spelled under Section 3 of the Housing Development (Control and Licensing) Act 1966) (“HDA”) where it is stated that “housing accommodation” includes any building which is wholly or principally constructed, adapted or intended for human habitation or partly for human habitation and partly for business premises;
(iii) it is irrelevant that the Purchased Property (and the Project) is built upon a commercial land in view of the definition of “housing development” in Section 3 of HDA which states to the effect that housing accommodation can be built upon any land; and
(iv) Lastly, it would be illegal to use a commercial SPA instead of Schedule H SPA as that would tantamount to circumvention of HDA 1966 which clearly states that a statutory SPA ought to be used if a property purchased is a housing accommodation.
Based on the Court’s pronouncement today and pending the Court’s release of grounds of judgment (if any), the Court held that our Clients have successfully proven their cases against the Defendant whereby, amongst others, HDA and Schedule H are applicable and that the LAD ought to be calculated as if the SPA is a Schedule H SPA.
This is groundbreaking in view that this is the very first time a court has held that a SOHO property (which has dual purposes: living and/or commercial) is a housing accommodation and Schedule H SPA ought to be adopted.
However, the Defendant still has an option to appeal against the Sessions Court’s decision within fourteen (14) days from the date of decision.
We shall update if there is any further progress to this case and share the grounds of judgment when it is released.
The Plaintiffs are represented by our Chuar Kia Lin and Lew Wei Shing
