Introduction
In the recent case of Ng Kong Onn & 170 Others v Menteri Kesejahteraan Bandar, Perumahan Dan Kerajaan Tempatan & Anor [Judicial Review No.: WA-25-434-07/2022], purchasers of parcels in a residential project known as Aera Servis Residensi @ Aera sought several legal remedies. They applied for:
An order of certiorari to quash an approval letter by the Minister dated 11.04.2022, which exempted 153 days from the calculation of the date for delivery of vacant possession under the respective sales and purchase agreement.
A declaration that the exemption was null and void, being ultra vires Section 38C of the COVID Act.
Grounds for Judicial Review
The purchasers presented the following grounds for their judicial review:
The developer filed the application for the exemption after the allowed time period had lapsed.
The purchasers were not given a right to be heard.
The Minister considered irrelevant factors.
The Minister did not consider relevant factors.
The Minister did not provide reasons for his decision.
Decision of the Court
The Court first examined Section 38C of the COVID Act, which states:
“(1) In relation to a housing development, notwithstanding any agreement entered into between a developer and a purchaser, the developer may apply to the Minister for any period from 1 January 2021 to 31 December 2021 to be excluded from the calculation of the time for delivery of vacant possession of a housing accommodation or completion of common facilities, as the case may be, in the housing development.”
The only acceptable reason for the Minister to grant an exemption, as stated in Section 38C(2), is:
“if the Minister is satisfied that due to measures prescribed, made or taken under the Prevention and Control of Infectious Diseases Act 1988 to control or prevent the spread of COVID-19, the developer was unable to deliver vacant possession of a housing accommodation or complete the common facilities in accordance with the agreement.”
The language of the Act is clear and unambiguous. Additionally, Section 38C(3) stipulates that the application must not be made after the expiry of the time for delivery of vacant possession or the completion of common facilities as specified in the sale and purchase agreement:
“The Minister shall not consider an application under subsection (1) if the application is made after the expiry of the time for delivery of vacant possession or the completion of common facilities specified under the agreement.”
The wording “shall not consider an application” is mandatory and leaves no room for exceptions. The last date for the developer to deliver vacant possession was 26.12.2021, but the application was only made on 24.01.2022. Therefore, the exemption given after the expiry date was illegal and ultra vires Section 38C of the COVID Act.
Secondly, the Court determined that the Minister should have given the purchasers the right to comment on the exemption application, despite the COVID Act not expressly providing for such a right. Established law, as seen in Ketua Pengarah Kastam v Ho Kwan Seng [1977] 2 MLJ 152 and Menteri Kesejahteraan Bandar, Perumahan dan Kerajaan Tempatan & Anor v Ang Ming Lee & Ors and other appeals [2018] 4 MLJ 545, supports the necessity of a right to be heard even if not explicitly stated in the statute.
The purpose of the scheduled contracts is to protect the purchasers' interests. The Minister's decision deprived the purchasers of their right to claim liquidated damages. The failure to afford the right to be heard constituted procedural impropriety.
Ultimately, the Court granted the orders sought by the purchasers.
Conclusion
This decision is groundbreaking as it clarifies that any exemption granted to a developer under the COVID Act can be set aside if the purchasers were not given a right to be heard.
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