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Cabinet and Parliament should conduct urgent post-mortem as to how they could make the colossal blunder in enacting the Housing Development (Control and Licensing) Act 2002 resulting in the indefinite suspension of Tribunal for Homebuyers  Claims and tens of thousands of small-time house-buyers facing losses up to RM250 million

Media Conference Statement
- when visiting the Tribunal for Homebuyers Claims
by Lim Kit Siang

(Kuala Lumpur,  Tuesday): In my media statement yesterday, I posed the following questions consequent to the Kuala Lumpur  High Court judgment last Thursday striking down the jurisdiction of  the Tribunal for Homebuyers Claims to adjudicate  disputes over property bought before December 1 last year:

  • Will the Tribunal for Homebuyers Claims  be guilty of contempt of court if it proceeds to exercise jurisdiction over property transactions before Dec. 1 last year, as all the some  5,000 claims which had been filed by aggrieved home-buyers to date  belong to this category? 
  • Should the Tribunal for Homebuyers Claims close shop temporarily until the outcome of the appeals, with all the staff being paid for no work done in the meantime? 
  • What is the position of the 438 claims involving RM2.4 million which had been settled and awarded by the Tribunal for Homebuyers Claims as of July 3 this year?  Can the  developers who had not paid the awards adjudged by the Tribunal now withhold payment to the housebuyers in view of the High Court decision? Can developers who have paid the awards file civil claims for their return? 
  • What is the position of the some 4,500 cases pending at  the Tribunal for Homebuyers Claims as they should all be affected by the High Court judgment being   properties transacted before Dec. 1 last year.
  • Must the Tribunal suspend all hearings and awards until the outcome of the appeals against the High Court judgment? Can new claims involving properties transacted before Dec. 1 be submitted to the Tribunal or are all new  claims now  suspended? 

Today we have  an answer to one of the questions I posed yesterday, with the Tribunal for Homebuyers  Claims shuttered and suspended  indefinitely, with the prominent notice outside the tribunal” “NOTIS. SEMUA URUSAN PENDENGARAN/KES-KES TUNTUTAN DI TRIBUNAL INI DI TANGGUHKAN HINGGA DIBERITAHU KELAK. Terima Kasih.”

Has the Attorney-General advised the Tribunal to suspend all its functioning indefinitely until the High Court judgment last Thursday could be reversed in appeal at the higher appellate courts? 

Yesterday, the Attorney-General’s Chambers filed a notice of appeal  at the Special Powers and Appellate Court’s registry against the High Court judgment that the Tribunal does not have jurisdiction to adjudicate disputes over property bought before December 1 last year. 

There can be four possibilities in the appeal against the High Court judgment striking down the Tribunal’s  jurisdiction to adjudicate property disputes transacted before December 1 last year, which is most likely to be fought all the way from the Court of Appeal (CA) to the Federal Court (FC). 

  1. Tribunal wins at CA  and wins  at FC.
  2. Tribunal wins at CA but loses at FC.
  3. Tribunal loses at CA but wins at FC.
  4. Tribunal loses  at CA and loses  at FC.

What are the government’s contingency plans to deal with all these four scenarios, including the first scenario?  This is because even if the happy outcome of the first scenario eventuates, with the tribunal vindicated at both the Court of Appeal and Federal Court, what is the position of the tribunal in the intervening months before the first appellate judgment could be handed down?

The situation would be even more serious in the other three scenarios, in particular Scenario 2 and worse of all in Scenario 4.  Even in  Scenario 3 where the Federal Court finally upholds the Tribunal’s jurisdiction despite reverses at the Court of Appeal, there is the pertinent question as to the position of the Tribunal in the six to 12 months,  if not longer, that would be required before a final adjudication from the highest court of the land. 

Such six to 12 month suspension of the functioning of the Tribunal, or even for a longer period, will adversely impact and even extinguish the rights of the home-buyers, as section 16 N(2) of the  Housing Developers (Control and Licensing) (Amendment) Act 2002 stipulates that the jurisdiction of the Tribunal is limited to a claim that is based on a cause of action arising from a sale and purchase agreement which is brought by the homebuyer “not later than 12 months from the date of issuance of the certificate of fitness for occupation for the housing accommodation or the expiry date of the defects liability period as set out in his sale and purchase agreement”. 

If the entire  appeal process to the Court of Appeal and the Federal Court should take, for instance, six or 12 months, if not longer,  and during this period new claims cannot be filed with the Tribunal because of the High Court judgment, time would have begun to run and  the time-limit for  tens of thousands of homebuyers to institute claims with the Tribunal would be lost, adversely affecting their rights. 

It will of course be unmitigated disaster to the tens of thousands of small-time housebuyers to have a cheap and speedy mechanism to address their grievances against unscrupulous and unprincipled housing developers should  Scenario 2 or 4 eventuate.

Cabinet and Parliament should conduct urgent post-mortem as to how they could make the colossal blunder in enacting the Housing Development (Control and Licensing) Act 2002 resulting in the indefinite suspension of Tribunal for Homebuyer  Claims and tens of thousands of small-time house-buyers facing losses up to RM250 million.

Although the claims to the Tribunal are  limited to a maximum of RM25,000 each, (and a house-buyer can make multiple  claims with each claim for each  cause  of action) the total compensations  involved just for 10,000 claims could be in the region of RM250 million – a staggering sum and loss for tens of thousands of small-time house-buyers in their uneven fight for justice against housing developers. I believe that the total claims pre-dating  Dec. 1 could be in the region of 20,000 to 30,000 or even higher. 

I have studied the judgment by Justice Datuk Md Raus Sharif, and although my “heart” is fully with the small-time house-buyers to level the playing field to get cheap and quick justice in their grievances against powerful, wealthy but often unscrupulous and unprincipled housing developers, my “head” is disturbed  that “there is no clear indication in the Amendment Act for a retrospective application” of the Tribunal’s jurisdiction  to before December 1 last year.  

In fact, this glaring omission had been pointed out by the leading authority on property law, Professor Salleh Buang, who asked this question in January this year: “Although the Tribunal commenced operations from Dec. 1, 2002, why can’t we give it jurisdiction to hear disputes arising from SPAs (sale and purchase agreements) signed as far back as Jan. 1, 2000 or even much earlier?  Or did someone in the Housing Ministry forget to consider this point?” 

What is deplorable and inexcusable is that during the debate on the  Housing Developers (Control and Licensing) Amendment Bill 2001  in October  2001,  two DAP MPs Teresa Kok  (Seputeh) and Chong Eng (Bukit Mertajam)  called on the Minister for Housing and Local Government, Datuk Seri Ong Ka Ting to ensure that the Tribunal would have such retrospective jurisdiction to deal with current and not future grievances of the house-buyers – but their calls  fell on deaf ears.  Not a single  BN MP cared about this important point of retrospectivity.

(9/9/2003)

* Lim Kit Siang, DAP National Chairman