The email reads as follows:
I have read many articles from you blog with regards to abandoned housing development. I am writing to seek your advice regarding my situation and also on behalf of the to other purchasers.
If you don’t mind, let me explain the brief story. We bought a semi D house in mukim … in 2008. There are only 10 houses in the development called taman … and the developer was …. Subsequently the developer was liquidated and …. has been appointed as the liquidator. At this juncture the houses were completed up to 75% except for electrical , water pump house and roadwork.
It has been more than a year but the liquidator has not made any progress. Latest news we heard that the liquidator is now applying to the court for a scheme to revive development but with the condition that we need to top up almost RM 30 000 on top of the original purchased price. Some purchasers are not able to do so due to financial constraints.
In such a scenario, do we have any rights to demand that the liquidator complete the houses without any additional payments required from purchasers? Should they refuse , what other options do we have ?
I apologize that this email may disturb you but we would be very grateful to hear your opinion
Thank you so much for the prompt reply. I have another few questions if you don’t mind. If the S and P is terminated , I am not sure whether the liquidator will return our money because the title has been transferred .
If the liquidator terminate and give us the half completed house (as is where is basis) , I am not sure how to continue the development on individual basis since it is a Semi D. I would appreciate your knowledge sharing on such case.
I sympathize with your fate.
My advice is this:
If you have an option, you should terminate the sale and purchase agreement and request the liquidator to repay all your moneys paid to the wound up developer. You can apply to the court to terminate sale and purchase agreement and ask the liquidator to repay all you moneys paid to the previous developer. Buy a new completed house. Full stop.
I think the liquidator has no source of money to rehabilitate the project. So that he asked you to top up. He also needs to get profit from the project as fees. If you think that you have adequate patience, please bear with the liquidator to complete the rehabilitation. If not, ie if your feel that this is not worthwhile, terminate the sale and purchase agreement and ask the liquidator to repay back all your moneys.
This email is my personal opinion and made on without prejudice basis.
All the best.
Assoc. Prof. Dr. Nuarrual Hilal Md Dahlan, UUM, Kedah
If you want the completed house, you have to add up RM 30 k. You have to cooperate with the liquidator in order to complete. Nonetheless, you will be required by the liquidator to sign a waiver letter which states that the liquidator will not be responsible to any liability and faults of the wound up developer company. The waiver letter also may contain a statement that you waive all damages/compensations arising from the losses you suffered due to the abandonment. New S&P agreement may need to be entered into between you and the liquidator. The terms may be different from the original S&P and that your rights may be marginalized in order to protect the interests of the liquidator.
Question: Whether this new S&P has been approved by the Ministry of Housing?
If you are not agreeable to have your abandoned unit be revived due to complications and other troubles, you can/may terminate the S&P and claim for all the moneys paid to the developer, including damages until full settlement. In this case, you also need to file proof of debts and submit it to the liquidator. You will be considered as an unsecured creditor of the wound up housing developer company and may entitle to a refund of all your moneys and other damages.
The question whether the land has been transferred into your name does not matter as the contract imposes the developer to complete the house with vacant possession and with the CCC obtained. Even though the title has been transferred into your name, the developer is still in breach of the contract in that he has not yet completed the house, deliver vacant possession and provide the CCC.
I think in certain circumstance, it is appropriate for you to terminate the S&P and claim for refund and ask for damages. All these must be supported with court judgment.
This advice is made on a without prejudice basis.