Issues in Abandoned Housing Projects in Peninsular Malaysia: Variation of Conditions, Restrictions in Interest and Land Use – Part Two

Given that one of the requirements for the application of licence was the proof of the conversion and variation of the category of land use concerned, before the application could be processed and approved, why had MOH granted the application for housing developer’s licence and its renewal, when the application for conversion and variation of the category of land use had yet been finalized and was still pending?

The above situation is further worsened, as Schedule A (Application For a Housing Developer’s Licence), has been repealed in 2007.  Among the requirements for applying for the licence according to the previous Schedule A, was that the applicant developer has to provide a copy of an approval for the conversion and proof of subdivision of the lands.  However, with the new amendment in 2007, these obligations, may not be required.  With this new amendment, the Housing Controller has full discretion whether to impose conditions or not for the application.  This may mean, the Controller would be in a position to exempt proof of conversion and subdivision of land, for approving the housing developer licence’s application.

The second issue is a situation, whereby the grant of the purported application for variation and conversion of land is subject to certain conditions.  If the conditions cannot be met, the said application will be refused.  This can be illustrated in Khau Daw Yau v. Kin Nam Realty Development Sdn. Bhd [1983] 1 MLJ 335.  In this case, the land authority had imposed a condition that the sale of the land, together with buildings to be built on it, which would be subject to conversion, should be reserved to at least 30% of bumiputra purchasers.  As the purchases were all made by the non-bumiputra purchasers, the application for conversion, thus, could not be effected.  This left the non-bumiputra purchasers without any remedy except by way of damages.  It is opined, the condition was more appropriate for the local planning authority to issue as it involved planning and development policy and did not concern the land use.  Thus, on this footing, it is opined that, the decision of the land authority was not reasonable and was unfair, which may warrant its nullity.

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