Victory for 46 house buyers

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High Court orders housing developer to pay RM4.5 million for negligence and breach of contract

KOTA KINABALU: Forty-six house buyers got their perfect gift for the Chinese New Year after the High Court here yesterday ordered a housing developer to pay RM4.5 million to them for negligence and breach of contract.

Judge Datuk David Wong Dak Wah yesterday allowed a civil suit brought by Lim Chon Jet @ Lim Chon Jat and 45 other house buyers against Yusen Jaya Sdn Bhd.

David ordered the company to pay RM305,681.67 for liquidated and ascertained damages for late delivery of the houses under Clause 18 (2) of the Sale and Purchase Agreements, RM4,148,793 in damages for breach of contract and RM137,989 for costs of investigation, bringing a total of RM4,592,372.67.

He also ordered interest at the rate of eight per cent per annum for the date of judgment to the full settlement of judgment sum and costs to the plaintiffs to be taxed unless agreed.

In his judgment, David held that housing developers in the State or for that matter in the country must realize that the majority of purchasers of houses are first-time home buyers and they utilize their life savings to realize their dreams of owning their home.

“And in doing so, they enter into a lifelong commitment of repaying the housing loan. These purchasers purchase their houses relying on the representation of the developers that the houses will be built with good workmanship and materials and the last thing they expect is to take possession of houses which are defective and requiring massive remedial works.

“In this case, legal action had to be taken which made the situation worse for the plaintiffs. As in other industries, the building industry must embrace its social responsibility of ensuring that it is respected by the society at large.

“This can be only done by not being driven with mindset of profit at any costs,” David said.

The 46 house buyers, who were represented by counsel Alex Decena, Wilson Lai and Christina Liew, filed their suit on May 5, 2008, naming Yusen Jaya Sdn Bhd as the sole defendant to seek a declaration from the court that that they were entitled to liquidated and ascertained damages under Clause 18 of the Sale and Purchase Agreements made between the plaintiffs and the developer.

The plaintiffs were also seeking damages for breach of contract, breach of statutory duty, negligence, distress and inconvenience, loss of amenity value of the houses and or the diminution value of the houses and the maintenance costs throughout the life span of the houses.

In supporting their claims, they said that after the issuance of the Certificate of Fitness for Occupation to the houses, defects due to defective materials or workmanship that were not in accordance with the agreements and or approved plans appeared.

They also claimed the developer breached its contractual duty by carrying out non-conformance works and or defective work not in accordance with the agreements and or using inferior and unsuitable materials.

Counsel Ronny Cham and Grace Chow acted for the company.

After the court delivered the judgement, Dr Kumar, who was the spokesman for the plaintiffs who bought the houses at Taman Bukit Saujana Springfields at Jalan Bantayan, Off Jalan Tuaran Mile 3 1/2 here, said they were happy with the verdict handed down by the judge.

“This verdict delivered by the judge is the verdict that all of us have been waiting for,” he said, adding that it would be a blow for the developer and all developers concerned in Sabah.

In the future, he said the developer would have to be a little concern about delivering properties to house buyers and house buyers here have a good chance of getting a better deliveration.

With the verdict, Kumar added the developer would never play around of house buyers and make sure that the delivering properties should be up to the highest standard.

He also thanked Christina and other lawyers for helping them in the case.

The hearing started on August 24, 2009 where all the house buyers had testified in the court while the company’s development manager, Ng Chee Ming, 44, testified in the court for the defendant.