KC Chan Brothers Development Sdn Bhd

- vs -

Tan

1. These are 26 appeals filed by the same defendant against 26 decisions of the learned Magistrate Temerloh made on January 29, 2000 in favour of 26 different plaintiffs arising from 26 separate civil suits. The defendant has filed 26 appeal notices on February 10, 2000 and later followed by 26 memorandum of appeal in respect of each decision.

   FACTUAL BACKGROUND

2. All the plaintiffs were house buyers for low-cost houses built by the defendant at Taman Seraya, Triang, Pahang Darul Makmur. For that purpose, all the plaintiffs had entered into their respective agreements with the defendant. Out of the 26 plaintiffs, 13 of them were buyers for single-storey low-cost houses while the other 13, were buyers for double-storey low-cost houses. All the plaintiffs filed their claims separately against the defendant in the Magistrate's Court Temerloh, claiming for compensation on the ground that their houses were not built in accordance with the specifications provided in the approved plans, which were part of the agreements. They claimed that the defendant had breached the agreements between them.

3. For the single-storey houses, the approved plan provides for the following:

   1. the height of the house shall be 10 feet from floor to ceiling;

   2. asbestos ceiling - to be installed;

   3. water PCC vent - 2 layers;

   4. roof rafters shall be from hardwood-size 2" x 4";

   5. "hardcore" flooring;

   6. septic tank wall - 9 inches thick.

4. On delivery of the said houses, the plaintiffs found the following:

   1. the height of the house, from floor to ceiling was only 9 feet;

   2. no asbestos ceiling installed;

   3. water PCC vent - only I layer;

   4. roof rafters - were of various sizes and not from hardwood;

   5. no "hardcore" flooring;

   6. septic, tank wall - only 4¾ inches thick.

5. For the double-storey houses, the approved plan provides for the following:

   1. the height of the house shall be 20 feet from floor to ceiling;

   2. asbestos ceiling to be installed;

   3. septic tank wall - 9 inches thick.

6. On delivery, the plaintiffs found the following:

   1. the height of the house from floor to ceiling was only 18 feet;

   2. no asbestos ceiling installed;

   3. septic tank wall - only 4¼ inches thick.

7. The defendant disputed the claim. The first case went on for full trial where the plaintiff (in that case) has called 16 witnesses. At the end of the plaintiff's case, (in that case) counsels for both the plaintiff and the defendant agreed that the facts and evidence adduced in that first case be applied to the other 25 cases. Along that line, the defence who has called three witnesses in the first case, was also to be applicable to all the other 25 cases agreed by the parties.

8. At the end of the trial, the learned Magistrate decided in favour of all the plaintiffs and found that the defendant was in breach of the respective agreements. In respect of the single-storey houses, the respective plaintiffs' were awarded a sum of RM8,400 as compensation together with costs and interests (for each of them). While in respect of the double-storey houses, each of the respective plaintiffs were awarded a sum of RM4,500 as compensation together with costs and interests.

9. The defendant, not being satisfied with all the 26 decisions, appealed to this court against all the 26 decisions separately and thus had filed 26 notices of appeal.

10. At the hearing of this appeal, both parties agreed to submit their written submissions which would be applicable for all the 26 appeals, as all the appeals involved the same set of facts and issues.

    WHETHER THE SAID DECISIONS ARE APPEALABLE:

    S.28(1) OF THE COURTS OF JUDICATURE ACT 1964

11. It is not disputed that each and everyone of the 26 decisions involved awards of less than RM10,000. The amount in dispute or the value of the subject matter is less than RM10,000.

12. The appellate civil jurisdiction of the High Court in respect of appeals from subordinate courts is governed by ss 27 and 28 of the Court of Judicature Act 1964. Section 27 of the Act provides:

    The appellate jurisdiction of the High Court shall consist of the hearing of appeals from subordinate courts as hereinafter provided.

13. Section 28(1) of the same Act provides:

    Subject to any other written law, no appeal shall lie to High Court from a decision of a subordinate court in any civil cause or matter where the amount in dispute or the value of the subject-matter is ten thousand ringgit or less except on a question of law.

14. For the purpose of s 28(1), the amount in dispute or value of the subject matter shall not include interests and costs. It only refers to the main award. This finding is supported by the decision of Penang High Court in Kannaya v Teh Swee Eng [1994] 2 AMR 1105 where it was held that:

    The value of the subject matter referred to in s 28(1) of the Act does not include interest and costs. To interpret otherwise would be to place an unnecessary burden on a plaintiff who would have to decide in the first instance in which court to institute proceedings and further to guess as to when his case would be disposed of and its outcome. It cannot have been the intention of the legislature to have enacted this provision to invite the plaintiff to first indulge in a guessing game as to the ultimate outcome of his action for the purpose of deciding in which court to institute proceedings.

15. Thus, based on the above-finding, it is clear that the amount in dispute or the value of the subject matter in all the 26 appeals before this court is below RM10,000. It is also clear that by virtue of ss 27 and 28(1) of the Courts of Judicature Act 1964 the High Court has no jurisdiction to hear these appeals except on a question of law. This is a question of jurisdiction which must be complied with strictly. It goes to the very core of the court's power in dealing with the appeal. Non-compliance with the provisions is fatal and would nullify the appeal. It is not a mere irregularity which can be cured by any other existing rules. It is a vital question to be determined and decided by the court at the beginning of the proceedings whether or not the respondent or any other party has raised it. The fact that the respondent does not raise the issue at the beginning of the proceedings does not mean that the court has the jurisdiction to hear the appeal even though the conditions set under s 28(1) of the Act are not fulfilled.

16. That being the case, it is necessary at this stage for this court to be satisfied that the appeal is only on a question of law - i.e. it involves issues on questions of law raised by the defendant to be determined and decided by this court. It only covers issues on questions of law alone, nothing else.

17. Issues involving questions of fact or that relate to the application of the law to the facts are clearly outside the jurisdiction of this court. (See Mohamad Safuan Wasidin v Mohd Ridhuan Ahmad [1994] 2 MLJ 187; and Tiang Kwong Eee v Ing Kai Hong (S) Sdn Bhd [2000] 5 MLJ 756.)

18. For that purpose, the court has to scrutinize the notice of appeal as well as the memorandum of appeal to see whether any question of law has been raised by the appellant. There must be some form of indication (i.e. general indication) in the notice of appeal as well as the memorandum of appeal that a question of law has been raised. It need only be in general and need not be specific. In Sulaiman Mohamad v Malayan Banking Bhd [1992] 2 MLJ 116 Lamin J (as he then was) held:

    I am of the view that in the case of an appellant intending to appeal on a question of law, the notice of appeal in Form 140 must state at least in general form the question or questions of law that he wishes to appeal on.

19. In another case, Mohamad Safuan Wasidin (supra), Abdul Malik Ishak JC (as he then was) has also ruled:

    In my judgment, in the case of an appellant intending to appeal from the decision of the subordinate court where the quantum is less than RM10,000, the notice of appeal in Form 140 must state generally the question or questions of law that he wishes to appeal on. Any failure to conform to this basic statutory requirement would strike at the very core of the appeal and, consequently, would nullify the appeal. For the reasons adumbrated above, I dismissed the appeal with costs.

20. The same ruling was also made by Tee Ah Sing J in Tiang Kwong Eee v Ing Kai Hong (S) Sdn Bhd, (supra). He concluded:

    The failure to state in the notice of appeal in Form 140 the question or questions of law involved was fatal and would nullify the appeal.

    The Judge dismissed the appeal with costs on the ground that the appellant's notice of appeal did not state generally the question or questions of law that he wishes to appeal on.

21. In what format then, the question of law needs to be stated in the notice of appeal? All the above authorities have stated that the question of law must be stated at least in general form in the notice of appeal, but none has touched on the format of the statement. Form 140 itself does not help in this matter. The counsel for the plaintiffs contended that the question of law must be formulated in the form of 'question' to be answered by the court by using the opening word "whether ...". He further contended that the questions of law should not be in the form of a statement which says that "The learned Magistrate has erred in law ..." or "The learned Magistrate did not take into consideration issues and question of law ...".

22. Since there is no specific provisions or guidelines as to how a question of law needs to be stated in the notice of appeal, then the court has to peruse the notice of appeal as well as the memorandum of appeal in detail in order to be satisfied that in substance a question of law alone has been raised. How and in what format the question was raised or stated is not that important. The substance is what matters. In this regard, I am in full agreement with Selventhiranathan JC (as he then was) in Kannoya (supra) where at pp 1109-1110 he said:

    I also found that the second ground of objection to the appeal by learned counsel for the respondent has merit. I have perused the memorandum of appeal in detail and compared it with the grounds of judgment of the learned Magistrate. Having done so, I am satisfied that all the grounds of appeal in the memorandum at best relate to the application of the law to the facts and do not involve any question of law alone for decision. Labelling the grounds of appeal as involving questions of law does not metamorphose what are essentially questions of fact into questions of law. The substance is what matters, not the label.

23. In the present case, after going through the notices of appeal as well as the memorandums of appeal in detail, I am satisfied that, in substance, there are questions of law raised by the defendant for this court's decision. The issues are as follows:

    1. whether the plaintiffs must have complied with the provisions of Clause 23 of the sale and purchase agreements first before initiating their claims in court;

    2. whether the Magistrate can award compensation exceeding the maximum amount specified in the statement of claim;

    3. whether, based on the interpretation of Reg 11(1) of the Housing Developers (Control and Licensing) Regulations 1982, a copy of the approved building plan must be attached/annexed to the sale and purchase agreements; and

    4. whether, upon issuance of the certificate of fitness for occupation (CFO), the plaintiffs are entitled to claim compensation from the defendant for non-compliance with the specifications or any other defect to the house.

24. The defendant has listed 12 issues in the notice of appeal and 21 issues in the memorandum of appeal. Except for the four issues which I have listed above that involved questions of law alone, all the other issues raised by the defendant do not involve any pure question of law for decision. At best, those issues relate to the application of the law to the facts on the case. To my mind all those issues involve questions of fact which were decided by the learned Magistrate after having heard all the witnesses. Whether to accept or reject their evidence, is a matter clearly within his province as long as he had valid reasons to do so. So, by virtue of ss 27 and 28(1) of the Courts of Judicature Act 1964, this court has no jurisdiction to entertain and to consider those issues. For the purpose of these appeals, I shall only deal with the four issues which I have cited above.

    FIRST ISSUE:

    Whether plaintiffs must have complied with Clause 23 of the

    sale and purchase agreements before initiating their claims in court

25. Clause 23 deals with defect liability period. In full. Clause 23 provides:

    Any defects, shrinkage or other faults in the said Building which shall become apparent within a period of twelve ( 12) calendar months after the date of handing over of vacant possession, with connection of water and electricity supply to the said Building, to the Purchaser and which are due to defective workmanship or materials or the said Building not having been constructed in accordance with the plans and description as specified in the Second and Fourth Schedule as approved or amended by the Appropriate Authority, shall be repaired and made good by the Vendor at its own cost and expenses within thirty (30) days of its having received written notice thereof from the Purchaser and if the said defects, shrinkage or other faults in the said Building have not been made good by the Vendor, the Purchaser shall be entitled to recover from the Vendor the cost of repairing and making good the same and the Purchaser may deduct such costs from any sum which has been held by the Vendor's solicitor as stakeholder for the Vendor: PROVIDED THAT the Purchaser shall, at any time after expiry of the said period of thirty (30) days, notify the Vendor of the cost of repairing and making good the said defects, shrinkage or other faults before the commencement of the works and shall give the Vendor an opportunity to carry out the works himself within fourteen (14) days from the date the Purchaser has notified the Vendor of his intention to carry out the said works.

26. Ground (c) of the notice of appeal states that [translation][a]:

    The Learned Magistrate did not consider the issued concerning the plaintiffs failure to comply with clause 23 of the Agreement and the question of law on whether the Plaintiffs are entitled to claim damages under clause 23.

27. I have studied the grounds of decision by the learned Magistrate (at pp 508-535 of the appeal records) and am fully satisfied that the learned Magistrate has appropriately considered the issue relating to Clause 23 and has ruled that the plaintiffs need not issue the said notice under the clause before taking their actions to court. The defendant also argued that all the plaintiffs have failed to give any notice to the defendant under Clause 23, thus they are estopped from taking any action against the defendant in court. With respect I cannot agree with this argument.

28. All the relevant sale and purchase agreements in these appeals were signed between the plaintiffs and the defendant in 1990. These agreements were governed by the provisions of the Housing Developers (Control and Licensing) Act 1966 and the regulations made thereunder. At that time (1990), the relevant regulations were the Housing Developers (Control and Licensing) Regulations 1982 (the 1989 Regulations only come into force after 1990). Regulation 12(1) of the 1982 Regulations provides that every contract of sale for the sale and purchase of a housing accommodation together with the subdivisional portion of land appurtenant thereto shall be in the form prescribed in Schedule E. Regulation 12(2) further provides that no amendment to any such contract of sale shall be made except on the ground of hardship or necessity and with the prior approval of the Controller. In other words, all provisions in the sale and purchase agreement are actually statutory requirements which must strictly be complied with. Clause 23, particularly is meant to be as an additional protection for house buyers, without effecting or limiting their rights under the common law. This finding was clearly confirmed by the Privy Council in City Investment Sdn Bhd v Koperasi Serbaguna Cuepacs Tanggungan Bhd [1988] 1 MLJ 69 where Lord Templeman has expressed (at p 72):

    But the Act of 1966 and the Rules were designed to improve and supplement common law remedies and do not expressly or by implication deprive a litigant of a contractual remedy which is not dealt with under the Rules.

29. The same Clause 23, has been dealt with by Peh Swee Chin FCJ in Teh Khem On v Yeoh & Wu Development Sdn Bhd [1995] 2 AMR 1558 where he has said:

    I share the view espoused by Lord Denning in Hancock v B W Brazier Ltd [1966] 2 All ER 901; [1966] 1 WLR 1317, to the effect that such clause similar to Clause 23 in our instant appeal about making good structural defects discovered within six months, would not take away the right to sue in respect of such defects which were not discoverable within such six months, and that further in regard those defects discovered within the six months, the provision of an express remedy of making good the same defects will not ipso facto take away the rights of any purchaser which normally follow at common law in the case of a breach of contract. It is pertinent to mention that our Clause 23 provides for 12 months instead of six months. The same principle would apply. Thus the said line of defence also fails.

30. On those authorities, I am of the view that the failure on the part of the plaintiffs as house buyers to issue any notice under Clause 23 of the sale and purchase agreements did not preclude them from initiating their civil claim under the common law for breach of contract against the defendant in court. Consequently, the question of estoppel as raised by the defendant does not arise.

    SECOND ISSUE:

    Whether the Magistrate can award compensation exceeding

    the maximum amount specified in the statement of claim

31. Originally, all the plaintiffs had limited their claim to not more than RM5,000 as stated in their respective statements of claim. Thus on that ground, the defendant contended that the Magistrate cannot award compensation exceeding the amount. The defendant further submitted that the Magistrate had erred in law when he awarded a sum of RM8,460 as compensation to each of the 13 plaintiffs who are house buyers in respect of single-storey houses. I have scrutinized the notes of evidence as well as the grounds of decisions of the learned Magistrate and the pleadings, and I found out that even though initially all the plaintiffs have limited their claim to not more than RM5,000 each, however, in paragraph 5 of the amended statements of defence, the defendant has stated that the plaintiffs have no right to limit their claim as specified in paragraph 8 of their statements of claim.

32. On that ground, the counsel for the plaintiffs, at the Magistrate's Court stage, admitted and agreed that the plaintiffs have no right to limit the amount of their compensation and submitted that the court then should be at a liberty to consider the amount of compensation based on the civil jurisdiction of a Magistrate Court to make an award of up to RM25,000, if damages are proven. In the premise, the limit initially stated by the plaintiffs in paragraph 8 of their respective statements of claim, has been abandoned and of no effect. Thus, the learned Magistrate, after being satisfied that damages have been proven, was entitled to make an award of up to RM25,000. Therefore, the allegation that the learned Magistrate has given awards of compensation exceeding the amount specified in the statements of claim should not arise at all.

    THIRD ISSUE:

    Whether, based on Reg 11(1) of the Housing Developers

    (Control and Licensing) Regulations 1982, a copy of the approved building

    plan must be annexed to the sale and purchase agreements

33. On this issue, the defendant cited Reg 11(1) of the Housing Developers (Control and Licensing) Regulations 1989 as the basis of the argument. In actual fact, the 1989 Regulations only came into force after 1990 i.e. after all the relevant sale and purchase agreements were duly signed by all the parties. Thus the 1989 Regulations were not applicable to those sale and purchase agreements. The relevant Regulations that were applicable at the time when those sale and purchase agreements were signed, were the 1982 Regulations, i.e. the Housing Developers (Control and Licensing) Regulations 1982. However the provisions of Reg 11(1) of

34. the 1989 Regulations which was cited by the defendant, was in effect, the same with Reg 12(1) of the 1982 Regulations; and the form of the sale and purchase agreement as prescribed in Schedule G in the 1989 Regulations is the same with the form of the sale and purchase agreement as prescribed in Schedule E in the 1982 Regulations.

35. By virtue of Reg 12(1) of the 1982 Regulations, every contract of sale for the sale and purchase of a housing accommodation shall be in the form prescribed in Schedule E. Thus the sale and purchase agreements are not merely private contract between the developer and the house buyers, but are contracts in statutory form, containing statutory requirements which must be fully and strictly complied with; and as provided under Reg 12(2), no amendment to any such contract of sale shall be made except on the ground of hardship or necessity and with prior approval in writing of the Controller. Regulation 14 of the 1982 Regulations further provides that any person who contravenes any of the provisions of the Regulations shall be guilty of on offence and shall be liable on conviction to a fine not exceeding RM5,000 or to a term of imprisonment not exceeding three years or both. In the present case, there is no evidence to show that the Controller has given his written prior approval to amend the form of the sale and purchase agreement as prescribed in Schedule E. Thus, the original Schedule E is applicable. One of the recitals to the said Schedule E states:

    AND WHEREAS the Vendor has obtained the approval of the building plans (hereinafter referred to as "the Building Plan") from the Appropriate Authority, a copy of which is annexed as the Second Schedule, [emphasis added]

36. From this recital, it is clear that the approved building plans must be attached or annexed to the sale and purchase agreements and form part of the agreements as Second Schedule. It is a mandatory requirement. RK Nathan J in dealing with Reg 11(1) of the 1989 Regulations (which in effect is the same as Reg 12(1) of the 1982 Regulations) in Chua Eng Hong v Palm Springs Development Sdn Bhd [2001] 6 CLJ 298 has made the same ruling i.e. that the sale and purchase agreement was in the statutory form and must be complied with and cannot be waived or modified except with the approval in writing from the Controller.

37. Since the sale and purchase agreement was in the statutory form and by law, the approved building plan need to be annexed to the sale and purchase agreement, therefore the said approved building plan must be deemed to have been annexed and incorporated into the sale and purchase agreement although in actual fact the plan was not annexed to the sale and purchase agreement at all. Thus the provisions and specifications contained in the approved building plan must be deemed to form part of the agreement and bind the parties concerned.

38. Hence, the maxim "equity treats as done that which ought to have been done" must apply to the present case. This was supported by Shanker J in Tan Yang Long v Newacres Sdn Bhd [1992] 1 MLJ 289, when he said:

    There was an immediate legal duty upon the part of Metroplex to reassign their rights under the agreement which they failed to do. Equity in this respect must regard that as done which ought to have been done.

39. In the present case, there was no evidence to show that the approved building plan, which was prepared by the defendant's architect, has been annexed to the sale and purchase agreements. The defendant may have committed an offence under Reg 14 of the 1982 Regulations. Thus, the defendant should not be allowed to take advantage of his own wrong doing. In any event it is the law that no man can take advantage of his own wrong doing: nullus commodum capere potest defendant injuria suapropria (see Hock Hua Bank (Sabah) Bhd v Lam Tat Ming [1995] 4 MLJ 328).

    FOURTH ISSUE:

    Whether, upon issuance of the certificate of fitness for occupation (CFO), the

    plaintiffs as house buyers, are entitled to claim compensation from the

    defendant for non-compliance with the specifications or any defect to houses.

40. The defendant argued that since the CFO to those houses were issued by the relevant authority, certifying that the houses were fit for occupation, the plaintiffs are not entitled to claim that the houses were defective for non-compliance with the specifications, and also not entitled to claim compensation from the defendant. However, the defendant did not cite any authorities to support this argument.

41. With respect, I cannot agree with this argument. I am of the view that the CFO, which in the present case, was issued by the relevant authority on April 30, 1991 (according to PW4), is to certify that the house in question is deemed fit for occupation. It is issued upon completion of the house by the developer and after the relevant authority is satisfied that the relevant provisions of the Uniform Building By-Laws 1984 (GN5178/85) (UBBL) c haw been complied with. The UBBL sets the minimum standards and specifications for the houses in question. However, the sale and purchase agreements together with the approved building plans are separate documents. The specifications to the houses as contained in the sale and purchase agreements and the approved building plans may be different (but shall not be less favourable) compared to the specifications in the UBBL. So, if the developer has satisfied the specifications in the UBBL, it does not necessarily mean that he has also satisfied or fulfilled the specifications in the sale and purchase agreements and the approved building plans.

42. The rights of the house-buyers to claim compensation for any defect or non-compliance with the specifications, do not depend on the issuance of the CFO. These rights are provided under Clause 23 to the sale and purchase agreements as well as under the common law for breach of contract. Clause 23 provides for defect liability period of (12) months after the date of delivery of vacant possession to the house-buyers. Manner of delivery of vacant possession is provided under Clause 19 i.e. upon the issue by developer's architect of a certificate certifying that the construction of the building has been duly completed and the purchaser having paid all monies payable and performed or observed all the terms and covenants on his part under the sale and purchase agreements. However, such possession shall not give the purchasers the right to occupy and the purchasers shall not occupy the said house until such time as the CFO is issued. It is the duty of the developer to procure the issue of the CFO from the appropriate authority as provided under Clause 20 of the sale and purchase agreements. In reality, some defects or non-compliance of specifications can only be discovered when the purchasers have occupied the house for sometime. That is why, Clause 23 gives a grace period of 12 months for the purchasers to discover the defects and non-compliance of specifications. After that 12 months period, purchasers may still enforce their rights under the common law for breach of contract. If the defendant's argument is to be accepted, then the rights and protection granted to house-buyers under Clause 23 as well as under the relevant laws (particularly the Housing Developers (Control and Licensing) Regulations 1982 (now as amended in 1989) and the common law for breach of contract, would be useless and serve no purpose at all.

    CONCLUSION

43. In view of the foregoing, I dismiss all the 26 appeals against all the plaintiffs with costs. The decision of the learned Magistrate in all the 26 cases are upheld.

City Investment Sdn Bhd v Koperasi Serbaguna Cuepacs Tanggungan Bhd [1988] 1 MLJ 69; Hock Hua Bank (Sabah) Bhd v Lam Tat Ming [1995] 4 MLJ 328; Kannaya v Teh Swee Eng [1994] 2 AMR 1105; Tan Yang Long v Newacres Sdn Bhd [1992] 1 MLJ 289; Teh Khem On v Yeoh & Wu Development Sdn Bhd [1995] 2 AMR 1558; Chua Eng Hong v Palm Springs Development Sdn Bhd [2001] 6 CLJ 298; Mohamad Safuan Wasidin v Mohd Ridhuan Ahmad [1994] 2 MLJ 187; Sulaiman Mohamad v Malayan Banking Bhd [1992] 2 MLJ 116; Tiang Kwong Eee v Ing Kai Hong (S) Sdn Bhd [2000] 5 MLJ 756.

Courts of Judicature Act 1964: s.27, s.28(1)

Housing Developers (Control and Licensing) Act 1966

Housing Developers (Control and Licensing) Regulations 1982: Reg.11(1), Reg.12(1), (2), Reg.14

Housing Developers (Control and Licensing) Regulations 1989: Reg.11(1)

Uniform Building By-Laws 1984

Sebastian & Bastian Pius Vendargon (Anthony Sebastian & Co) for Appellant / Defendant

Francis Tan (Rosni, Francis Tan & Ho) for Respondents / Plaintiffs

[a] Translation into english texts is not a part of the original judgment.

This decision is also reported at [2001] 4 AMR 4533