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EMKO PROPERTIES SDN. BHD. V. LEE CHOONG KHENG

HIGH COURT MALAYA, SHAH ALAM

MAHADEV SHANKAR J

[ORIGINATING SUMMONS NO: 24-540-1990]

11 OCTOBER 1996

Contract: Sale and purchase of property - Townhouse - Application for a declaration that the defendant is laible to pay RM60 per month for maintenance upkeep and repair of communal facilities - Whether the purchaser of a townhouse should pay the developer a charge for the maintenance upkeep - Proper construction of the sale & purchase agreement - Principles applicable - Rules of High Court 1980 O. 7 r. 2

JUDGMENT

Mahadev Shankar J:

This is a test case.

The issue is whether the purchasers of some townhouses in Wangsa Baiduri a private housing estate should pay the developer a charge for the maintenance upkeep and repair of communal facilities.

These purchasers say that because the Majlis Perbandaran Petaling Jaya (the MPPJ) has levied an assessment on their properties, for which they get no tangible return, they should not be penalised by having to pay the developer as well.

The MPPJ provides communal amenities but only up to the external boundary of the housing estate.

It says it is not obliged to provide such services within the housing estate.

Sometime in 1984 Emko Properties Sdn. Bhd. (Emko) applied to the MPPJ for approval of building plans for a mixed development consisting of condominiums and 484 units of townhouses on the land held under Lot 3067 and Lot 1127 owned by the Perbadanan Kemajuan Negeri Selangor (PKNS) with whom Emko went into a joint venture for this project.

James Fredericks, the town planner of the MPPJ has sworn an affidavit (see encl. 13 deposed on 4 September 1991 in UP 25-58-1990) in which he asserts that the MPPJ approved the Wangsa Baiduri project on the principle that it was a condominium complex which would have a management corporation.

He asserts that the MPPJ approved the project without insisting on infrastructure facilities such as a recreational area, and allowing very narrow internal roads without the necessary "clearance" required to be provided by the Streets Drains and Buildings Act 1974for the passage of the MPPJ refuse collection trucks.

He claims that the project was treated as a condominium project because the entire area was to be fenced in and guarded.

Fredericks further states that the MPPJ approved the Wangsa Baiduri project in the middle of 1985 as a condominium concept subject to the following conditions:

(a) the area had to follow the MPPJ's guidelines for condominiums;

(b) the club house to be provided had to have the required facilities;

(c) all the conditions in the approved plan had to be fulfilled;

(d) all the infrastructure facilities like drains, road lights and sewerage systems had to be provided as per the requirements of the MPPJ (in accordance with a condominium concept).

In accordance with these requirements he says the MPPJ gave its approval on the basis that the entire project could be administered by a management corporation as a condo style of living.

The MPPJ wrote a letter dated 27 June 1985 to Emko in connection with this submission.

For reasons best known to Emko and the MPPJ this letter has not been produced in evidence.

Emko's Counsel says their copy is lost and he has not been able to obtain a copy from the MPPJ! Neither of them have said why!

The only evidence the MPPJ has produced of these assertions apart from the bare word of Fredericks is a letter dated 19 July 1985, not from the MPPJ but from Emko to the MPPJ. The letter is reproduced here in full:

Tuan,

Pindaan keatas pelan cadangan pembangunan kondominium yang telah disokong secara prinsip dari segi perancangan disebahagian Lot 1127 dan 3067, Subang Jaya, Selangor untuk Perbadanan Kemajuan Negeri Selangor dan Emko Properties Sdn. Bhd.

Merujuk kepada surat tuan bertarikh 27hb June 1985 berkenaan dengan perkara tersebut diatas, kami sebagai pemaju bagi pihak PKNS mengucapkan ribuan terima kasih diatas sokongan tuan.

Didalam surat tuan ada mengandungi lima syarat-syarat yang tertentu.

Setelah dikaji dengan mendalamnya kami bersetuju dengan hampir kesemua syarat-syarat tersebut kecuali dengan syarat yang kelima (v) iaitu:

Pihak pemaju dikehendaki merujuk kepada Jabatan Pelajaran Selangor samada pihak ini memerlukan tapak bagi sekolah untuk kawasan ini.

Kami merayu kepada tuan supaya syarat tersebut dapat dikecualikan dengan sebab-sebab seperti berikut:

(i) Didapati bahawa disekitar rancangan tersebut mempunyai beberapa sekolah yang berdekatan.

(ii) Sebagai satu rancangan kondominium kami akan mengadakan suatu Pengurusan (Management Corporation) untuk mengendalikan segala-galanya seperti:

(a) menjaga kebersihan kawasan - termasuk pembuangan sampah-sarap.


(b) memperbaiki dan menjaga jalan-jalan, parit-parit dan lain-lain disekitar projek.

(c) kawasan ini akan dipagar keseluruhannya.

(d) mempunyai kawalan dipintu masuk (guard house).

(iii) Rancangan ini juga mempunyai sebuah Kelab Keluarga yang agak luar biasa.

Dengan adanya kemudahan-kemudahan ini kami berpendapat bahawa pihak kami dapat meringankan segala-gala beban yang ditanggung oleh MPPJ mengikut kelazimannya dan bagi pihak kami pula tujuan mengadakan kemudahan-kemudahan ini adalah sebagai gaya penarik kepada pembeli-pembeli dimana pasarannya agak lembab pada masa ini disamping memberi ertikata kondominium yang sebenarnya.

Sekiranya sekolah menjadi satu syarat maka segala-gala rancangan kami akan tergendala oleh kerana semasa perundingan dengan pihak PKNS projek ini dikehendaki menjadi suatu projek yang luar biasa daripada projek-projek PKNS yang lain.

Keinginan ini juga telah disampaikan oleh YAB Dato Menteri Besar sebagai Pengerusinya sendiri.

Dengan alasan-alasan ini kami harap agar pihak tuan dapat menimbangkan semula syarat untuk mengadakan sekolah di rancangan ini.

Sekian, terima kasih.

Yang benar,

Emko Properties Sdn. Bhd.

t.t. (Haji Zaini Haji Idris) Pengarah Urusan

So it was Emko which proposed that it should be relieved of the burdens of having a school within the project because it was going to provide the facilities set out in para. 4(ii) and (iii) of this letter, which was to include sanitation and refuse collection and the provision of a family club extraordinaire.

Precisely in what respect Emko/PKNS wished to amend the plan for the proposed project has not been made known to this Court.

The application was approved by a letter dated 10 March 1986 from the MPPJ to the chief executive of the PKNS. It reads as follows:

Tuan,

Permohonan meminda pelan tentang tataatur yang telah di luluskan untuk plan bil.(6)dlm. MPPJ/J/PB/PA/31 Jld.1 untuk cadangan Pembangunan Kondominium di-sebahagian Lot 3067 dan Lot 1127, Taman Subang Jaya untuk PKNS/EMKO Properties Sdn. Bhd.

Dengan segala hormatnya, saya diarahkan merujuk kepada perkara tersebut diatas dan memaklumkan bahawa Majlis menyokong pindaan pelan tersebut yang mengandungi perkara-perkara seperti di bawah dan syarat-syarat kelulusan ke atas pelan pindaan berkenaan adalah seperti berikut:

Jenis Jumlah Unit i) High rise condominiums 288 ii) Medium rise condominiums 451 iii) Point block condominiums 204 iv) Townhouses 486

Jumlah 1,429

Syarat-syarat kelulusan pelan pindaan seperti berikut: i) Pihak pemaju hendaklah menyelaraskan pelan tataatur dengan pelan-pelan disekeliling kawasan dengan bantuan Pejabat Perancang Bandar dan Desa Negeri Selangor. ii) Pemaju hendaklah mengemukakan pelan cadangan sistem jalanraya dan lapuran 'Management Corporation' bagi cadangan ini untuk perhatian Majlis.

Bersama-sama ini disertakan 6 salinan pelan bil. 1265/L(--)001 d yang telah disahkan oleh Majlis untuk tindakan tuan selanjutnya.

Sekian.

Berkhidmat Untuk Negara

Saya yang menurut perintah,

t.t. (James Fredericks) b.p. Yang Dipertua Majlis Perbandaran Petaling Jaya

The body of this letter describes condominiums and townhouses differently, but the second condition imposed by the MPPJ requires the developer to submit a report about the management corporation for the proposed project.

So the approval was given before the report was called for.

This report if it was prepared and/or submitted has not been put in evidence by Emko.

After the approval aforesaid, the developer commenced to market the accommodation in the proposed project.

Since it came within the scope of the Housing Developers (Control and Licensing) Act 1986 , the sale & purchase agreements produced by Emko followed exactly the standard format prescribed by Form E of the Housing Developers (Control and Licensing) Regulations 1982 (the said regulations). Wangsa Baiduri was advertised as the "first townhouse condominium concept" in the Malay Mail on 19 July 1986.

As on that day there were only 26 units left out of the 2275 storey townhouses and 48 units two storey townhouses.

So 412 units had already been sold.

This advertisement states that Emko is the developer, Fimco Management Sdn. Bhd. the project manager, and PKNS is the landowner.

Very special features inter alia were:

Total Privacy Concept - Security wall surrounds the whole project. - 24 hour security patrol.

"Show" townhouses were made available for viewing on 19 and 20 July 1986.

On 27 August 1986 Lee Choong Kheng (the defendant) and his wife Chin Fah Yew signed a sale & purchase agreement (the said agreement) with Emko to buy a 2275 storey townhouse.

Only the defendant has been sued in these proceedings and he is so referred to hereafter.

The defendant says he entered the said agreement on the strength of representations contained in a brochure (the said brochure). I have compared this brochure carefully with the said advertisement.

The brochure does not use the words "condominium concept" but it does refer to "complete security facilities that include guard house at the main gate, night patrol and perimeter fencing wall." Both documents were published under the same advertising permit and the pictures of the 2275 storey townhouse which appear in both appear to be the same.

Yap Kiang Liang, a director of Emko, asserts that the defendant's house was in Phase 1A and that the brochure does not refer to his house at all but he does not say why the details given in the brochure do not equally apply to the Phase 1A houses when all the details are otherwise the same.

The sale & purchase agreement is a very formal agreement and was very comprehensive in its terms. I must hold that both parties intended that the totality of their obligations to each other should be reflected in this document.

As I said earlier it is a replica of the statutory Form E.The recitals and in particular Recital No. 4 and cll. 17 and 24 would have made it crystal clear to the defendant that Wangsa Baiduri was being developed as an integrated housing estate which was the subject of a single layout plan in which the roads, drains, pipes, cables and wires laid or constructed by Emko were to be in accordance with the specifications approved by the MPPJ and were to be enjoyed by the Wangsa Baiduri residents in common.

The point is made to demonstrate that the defendant cannot claim that merely because he was buying one plot No. 270 for which a subdivided title was to be issued thereafter, his house was not an integral part of this entire housing estate.

The townhouses consisted of over 1/3 the total number of units and near 2/3 of the ground area.

This case turns upon a proper appreciation of the effect of cll. 14 and 22 of the sale & purchase agreement.

They read as follows:

14. The vendor shall at its own cost and expense construct or cause to be constructed the roads, driveways, drains, culverts, water mains or sewerage mains or sewerage plants, serving the said housing estate in accordance with the requirements and standards of the appropriate authority.

The vendor shall also bear all costs and expenses charged by the appropriate authority in connection with the provision of facilities and amenities including but not limited to street lighting. On completion of the constructions of the infrastructure hereinbefore mentioned, the vendor shall do everything possible within its power to have the same taken over and maintained by the appropriate authority but until they are so taken over the purchaser shall from the issue of notice to take vacant possession of the property contribute from time to time a fair and justifiable proportion of the cost and expense of their maintenance, upkeep and repair excluding areas reserved for roads, open spaces, electricity, substations, septic tanks and other communal amenities, such apportionment to be made by a licensed surveyor appointed by the vendor.

22. The vendor shall provide services including refuse collection, cleaning of public drains and grass cutting on the road reserves as from the date of delivery of vacant possession until the same are taken over by the appropriate authority and the purchaser shall meanwhile make an appropriate monthly contribution to the vendor.

Upon completion of the project the defendant paid an advance towards the monthly contribution of RM60 demanded and thereupon was handed the keys and went into possession of the premises.

Initially he paid the monthly contribution of RM60 requested by Emko.

But from November 1987 onwards he refused to pay anything.

On 16 January 1988 Emko sent a solicitors' letter demanding payment.

The defendant replied denying liability on the grounds that by promoting Wangsa Baiduri as a condominium project Emko had misrepresented the position because what he bought was a townhouse.

It was further contended that the service fee of RM60 per month was arbitrary, that no details had been provided as to how this figure had been arrived at and that the services provided were not to the defendant's satisfaction.

The request for a breakdown was not complied with and a further demand by Emko's solicitors on 9 March 1988 was rebuffed.

Around this time it appears that Emko was trying to get the MPPJ to take over the maintenance, servicing and the repairs of the infrastructure they had provided.

In this they totally failed.

On 6 February 1988 the MPPJ in reply to Emko's letter dated 12 January 1988 (not produced) stated that because the Wangsa Baiduri project was owned by the landowners they should provide the services and that the MPPJ would only provide services to public property used by the public.

Emko had also taken their problems to the controller of housing who interceded with the MPPJ. The controller wrote to the MPPJ on 17 May 1985.

The MPPJ replied four years later on 27 May 1989 to say that the project had been approved as a condominium concept and that therefore the responsibility of providing the communal services like roads, drains etc. was the responsibility of the management corporation.

As to how the service charge was quantified, Emko has put in a letter dated 18 November 1987 from M/s. Henry Butcher to say that RM60 per month was very reasonable and projected an increase of 25% every five years to cover inflation.

Their computation referred to in this letter was not disclosed.

Another quotation was obtained from Jones Lang Wooton (JLW) dated 29 January 1988.

Emko's invitation dated 21 January 1988 to JLW was not put in evidence. JLW's quotation for the "management" of the development was RM15 per unit per month for two years rising to RM19 per unit per month in the fifth year.

Whilst not absolutely clear, I infer from a reasonable interpretation of this letter that this money was only a management fee to engage and supervise other contractors to provide the required services and that these charges would be passed on to Emko.

Emko also obtained a quotation from WTW Property Services Sdn. Bhd. dated 20 February 1988 at RM95 per unit per month.

These quotations covered the "management of the Wangsa Baiduri condominium Development." I must take this to mean the entire area covered by this description i.e. townhouses, apartments and all.

The invitation by Emko to these real estate agents obviously contained a detailed description of the total number of units to be serviced and a precise description of the kind of services to be provided.

Since Emko has chosen not to disclose the invitation I must assume that they must have covered the services referred to in the sale & purchase agreement.

What emerges from the dates of the quotations received from the real estate agents aforesaid is that Emko decided to charge RM60 per month before these quotations were received.

The residents resisted the service charges and set up the Wangsa Baiduri Residents Association. (WBRA)

The solicitors' demands for payment were ineffective.

Following upon the refusal letter of the MPPJ to take over dated 6 February 1988, the controller of housing was also rebuffed by the MPPJ's letter dated 27 May 1989.

The MPPJ was not going to take over the responsibility for the infrastructure since Wangsa Baiduri was a condominium concept project and that was that.

Meanwhile the drain on the resources of Emko to provide these services continued.

As regards the townhouses there was another step to completion.

The subdivided titles were leaseholds for 99 years commencing 15 October 1985.

Upon payment in full under the sale & purchase agreement each purchaser was entitled to have the title transferred to him.

In the case of this defendant lot 260 was transferred and registered in his name on 31 December 1988.

The same day the property was charged to the Malaysia Borneo Building Society Bhd. These transactions required the consent of the Exco which had been given on 18 June 1988.

Commencing from 1 July 1988 the MPPJ commenced to levy assessment on the titles upon which the townhouses stood.

The townhouse residents complained that they were paying assessments to the MPPJ without getting anything in return. A "townhouse" was just a terrace house.

Terrace houses owners outside the perimeter also paid assessment but they got their refuse carried away and had their roads and drains serviced by the MPPJ.

Emko's letter to the MPPJ dated 19 July 1985 promised a superior family club but a letter dated 30 December 1988 sent by the WBRA to the MPPJ complained that the townhouse residents had no "recreational facilities". Almost a year later on 2 November 1990 the MPPJ replied to them to say that on future plans of Emko for development the MPPJ would impose a condition that recreational facilities should be provided for townhouse development as well.

There is a suggestion here that the true condo dwellers alone in Wangsa Baiduri were entitled to use the club house if there was one.

It will be recollected that the advertisements for the remaining Phase 1 townhouses referred to Fimco Management Sdn. Bhd., as project managers.

At some point in time Emko formed a subsidiary company called Emko

Management Services Sdn. Bhd. (Emko Management). A written agreement dated 12 February 1990 (the service charge agreement) between Emko Management and Mr. and Mrs. Urudra has been put in evidence.

According to this document Mr. and Mrs. Urudra entered into a sale & purchase agreement with Emko on 21 June 1989 for townhouse Lot No. 233.

Clauses (a), (b) and (c) of the service charge agreement between the purchasers and Emko Management reads as follows:

Whereas: a) By and agreement dated the day and year stated in s. II of the first Schedule Emko Properties Sdn. Bhd. (hereinafter called "the developer") of the first part and the purchaser of the second part, the developer has agreed to sell and the purchaser has agreed to purchase the townhouse described in s. III of the First Schedule hereto (hereinafter called "the townhouse") in the condominium-concept housing development known as Wangsa Baiduri (hereinafter referred to as "the condominium Estate"). b) The developer shall be in accordance with the terms and conditions of approval the development of the condominium Estate by Majlis Perbandaran Petaling Jaya provide services more particularly described in the second Schedule hereto to the condominium Estate (hereinafter referred to as "the said services"). c) The developer has requested the company and the company has agreed to provide the said services to the condominium Estate.

Emko has not produced in evidence the precise details and the date on which the MPPJ imposed the terms and conditions relating to the requirement of providing the services to the condominium estate, nor has it given details of the date and the terms on which Emko requested Emko management to function.

The second schedule reads as follows:

The service to be provided by the company are as follows:

A. Maintenance, upkeep and repair of public amenities such as:

1 roads 2 street lightings 3 sewerage system 4 monier pavements 5 pond 6 perimeter security wall 7 guardhouse 8 drains 9 electronic control gate

B. Maintenance and upkeep of trees, shrubs and grass including pruning of trees, shrubs and grass cutting within the common areas;

C. Scavenging services namely cleaning of public drains, roads and pavements; fogging of drains to prevent insect breeding and rubbish/garbage disposal.

D. Security services including guard patrol, issuance of magnetic passcard and screening of visitors/non-residents.

E. Placement of capital items such as roads, street lightings, pavers, sewerage system, trees, shrubs and electronic control gate.

The service charge agreement requires Mr. and Mrs. Urudra to pay RM60 per month for the first four years and thereafter rises to RM100 per month from 13th to 30th year.

Clause 4 provides for a residents committee, and the third schedule for "house rules". It may be inferred from this that by June 1989 Emko insisted that new purchasers must also sign the service charge agreement.

This agreement apparently did not deter Urudra from refusing to pay also.

His name appears as No. 233 on the trade debtors list dated 30 June 1991.

It shows him owing RM1,800 from November 1988 to April 1991.

According to the trade debtors list aforesaid the defaults of 13 purchasers in Phase 1 and another 12 purchasers in Phase 1A dates back to November 1987.

This refusal to pay obviously gathered an ever increasing momentum.

By May 1991 there were 398 defaulters for varying amounts depending on the date of commencement of their refusal.

The total outstanding then to Emko by the residents was RM263,203.

The list also shows RM576,298 owing to Emko Management Sdn. Bhd. (Emko Management). Emko has not disclosed what this is for but since the individual figures are all multiples of RM60 it is reasonable to infer that these are also arrears of service charges from persons who signed a service charge agreement with Emko.

M/s. Lovelace & Hastings came into the picture in 1990 as the new solicitors for Emko.

On 28 May 1990 they made another futile demand for the arrears from the defaulters.

They filed this originating summons on 6 December 1990, along with SP 24-538-90, SP 24-542-90, SP 24-544-90, SP 25-545-90 and SP 25-546-90. These originating summons are all in common form.

Only the identity of the defendants and the amounts of the alleged defaults vary.

Purportedly on the basis of requesting for an interpretation of the true meaning of cll. 14 and 22 of the sale & purchase agreement it prays for a declaration that the defendants are liable to pay RM60 per month till the date of the Court order and for such other relief as the Court deems fit.

The residents retaliated by applying for prerogative relief.

On 12 December 1990 S. Gunaseharan, one of the purchasers and the WBRA (the applicants) filed a motion 25-58-90 against Emko, the PKNS and the MPPJ for leave to apply for a mandamus requiring Emko to hand over the entire infrastructure and facilities of Wangsa Baiduri to the MPPJ and for certiorari to quash an alleged decision of the MPPJ dated 2 November 1990 refusing to take over.

In view of the inordinate delay in giving this judgment I feel constrained to set out the history of this litigation.

It first came before me in chambers on 6 September 1991 after both parties had filed several affidavits raising contentious issues of both fact and law.

By consent of the parties it was agreed that SP 24-540 of 1990 would be taken as a test case, and the parties in SP 24-538 of 1990, 544 of 1990, 545 of 1990 and 546 of 1990 agreed to be bound by the result UP 25-58-90 was directed to be heard together.

On 2 December 1991 the defendants changed their Counsel and filed two lengthy affidavits on 2 and 3 December 1991.

The hearing did not take place on 5 December 1991.

The next date given was 13 February 1992 when SP 24-542-90 was added to the list.

That day Counsel for the applicants withdrew his application for leave against Emko and the PKNS in UP 25-58-90. I therefore dismissed the proceedings against these two respondents.

This application was permitted to proceed against the MPPJ alone.

At the request of the Counsel for the applicants the matter was adjourned to 24 and 25 August 1992.

On 14 August 1992 the applicants in UP 25-58-90 filed a second motion 25- 39-92 against the MPPJ alone praying for mandamus to compel the MPPJ to take over damages, refund or assessment, and other relief.

This is a duplication of the relief prayed for in UP 25-58-90 except that the prayer for certiorari has been dropped and Kalaichelvi a/p Sinnathamny was added as co-applicant with S. Gunaseharan.

Two days before the hearing fixed for 24 August the applicants' solicitors served further voluminous affidavits which necessitated a further adjournment. I ordered the costs thrown away to be paid by the applicants.

On 30 September 1992 and 1 October 1992 the matter finally got under way and the submissions made for Emko and the defendant were partly completed.

By consent the matter was adjourned to 19 February 1993 for continuation.

Then began a series of adjournments which benighted the progress of this case.

Of all the factors which are inimical to the administration of justice, delay must surely be the foremost because it is something that can be avoided if all parties concerned are conscientious about their duty to the clients and to the Court. I hope this will be the last time that a case has to be postponed in this way because Counsel is ill.

If he cannot make himself available it is his duty to pass the brief to somebody else whether his problems are with his neck or with his stomach!

The crux of this case simply is whether the defendant should be made to pay RM60 per month from November 1987 by reason of the provisions of cll. 14 and 22 of the sale & purchase agreement and if there was such an obligation whether he was exonerated from that liability.

The wording of cl. 14 of the sale and purchase agreement is clear.

Emko had to provide the roads, driveways, drains, culverts, water mains, sewerage plants (compendiously referred to as "the infrastructure") for the entire housing estate in accordance with the requirements and standards of the MPPJ. Then cl. 14 provides that upon completion of the construction of the infrastructure Emko "shall do everything possible within its power to have the same taken over and maintained by the appropriate authorities but until they are so taken over the purchaser shall from the issue of notice to take vacant possession of the property contribute from time to time a fair and justifiable proportion of the costs and expense of their maintenance, upkeep and repair excluding areas reserved for roads, open space, electricity, substations, septic tanks and other communal amenities, such apportionment to be made by a licensed surveyor appointed by the vendor." After excluding areas reserved for roads and other communal amenities specified what we have left are drains, culverts, water mains, sewerage mains or sewerage plants other that septic tanks.

The purchaser's liability was to contribute a fair and justifiable proportion of the cost and expense of their maintenance upkeep and repair.

As the clause says the apportionment was to be made by a licensed surveyor appointed by the vendor.

To fulfill the demands of this clause it is necessary to know first what the total cost was of the maintenance upkeep and repair of the infrastructure and then to establish what would be a fair and justifiable proportion for each purchaser.

The licensed surveyor would have to show how his apportionment was calculated to show it was fair and justified.

This Court has not been supplied with any evidence to show what the total cost was, let alone any apportionment by a licensed surveyor.

Instead, Emko took an arbitrary figure of RM60 per month for every purchaser and sought some justification for this figure after the event by getting quotations from some real estate agents who have not been shown to be licensed surveyors.

The requirements of cl. 14 have not been satisfied.

Clause 22 does impose a similar liability upon each purchaser to make an appropriate monthly contribution for refuse collection, cleaning of public drains and grass cutting but how is one to determine what monthly contribution is appropriate from each purchaser unless the total cost is known and how the purchaser's position is related to the other residents available to contribute.

There is here a parallel to the legal principles relating to claims for damages. A plaintiff cannot simply throw his claim at the head of the Court and say this is what I have lost, so give it to me. He must prove it. (See Lee Sau Kong v. Leow Cheng Chiang[1960] 1 LNS 56). Emko was asking the residents to reimburse it for expenses they had incurred.

They have not told this Court what those expenses were in Ringgit and Sen.The sale & purchase agreements imposes a contractual obligation to tell the residents what the total cost was and how their appropriate contribution has been calculated.

But the contractual liability is there.

All these years Emko must have incurred the required expense to upkeep the infrastructure and maintain the services specified, and this Court must consider whether Emko was guilty of conduct which exonerated the residents from paying altogether.

Only one complaint of the residents is worthy of examination in this regard.

It is their suggestion that at the time the purchasers signed the sale & purchase agreements Emko knew that the MPPJ would never take over the maintenance of the infrastructure and the services referred to in cll. 14 and 22 and therefore had misrepresented a fundamental term of the contract namely (to put it at its highest) that there was a reasonable probability that the MPPJ would take over at some future date.

The onus of proving this assertion is upon the purchasers. I have not seen any concrete evidence to that effect.

Emko has been quite selective as to how much of its correspondence and documentation with the MPPJ it chose to reveal.

The defendant's solicitors have not been adequately energetic in forcing disclosure of the relevant documentation.

In the result all I have before me is a picture of a developer who was anxious to maximise its saleable areas in this housing estate by claiming exemptions from statutory requirements.

Full details have not been made available.

We only know about the school and recreational facilities and unspecified amendments to the layout plan which were passed on 10 March 1986 subject to the submission of a report for the approval of the MPPJ on the formation of a management corporation. I do not know if such a report was submitted and I do not know if and when the MPPJ did impose a condition to provide services as per the second recital in the services agreement.

There is however some evidence to indicate that Emko and the residents themselves tried to get the MPPJ to take over but the first categoric refusal only came on 6 February 1988 (which merely referred to private ownership of the land as the reason). The MPPJ's reply dated 27 May 1989 where the condominium concept reason was advanced came five years after the letter of the controller of housing dated 17 May 1985.

The inference is that prior to 6 February 1988 the position was open to whether the MPPJ would take over. I have not been referred to any law which prohibits the MPPJ from taking over a condominium concept project if both parties agree, and the residents are prepared to pay for local authority services (See s. 116 of the Local Government Act 1976 ).

In the absence of clear evidence that Emko had actual knowledge at the time the sale & purchase agreement was signed that the MPPJ would never take over, it is futile for this Court to speculate on what the legal position would be if Emko knew.

So it is also futile to speculate on whether the purchaser's remedy at that time might have been repudiation or only damages for breach of warranty, since they affirmed the agreement by continuing to reside in the premises.

The defendant has complained that the services provided did not meet the expectations of the residents and provided photographs to show accumulated refuse, clogged drains etc.

If they can be quantified in monetary terms, these complaints go to reduction not exoneration.

The residents however must remember that by refusing to pay anything they have contributed to the lack of enthusiasm of the developer in giving them full satisfaction.

In my view the imposition of assessment by the MPPJ did not by itself exonerate the residents from paying an appropriate service charge because the terms of the sale & purchase agreement made it clear that they had to pay this until the MPPJ took over.

The reasons why the MPPJ did not take over is a separate issue.

Indeed the residents reorganised this when they proceeded against the MPPJ and I have covered this in a separate judgment.

In the result what we have left is a situation where Emko has shown a contractual liability on the part of the residents to make an appropriate contribution but has produced no evidence to sustain the contention that it should be RM60 per month, and the residents have raised possible defences which may be a proper subject for a set off and/or counterclaim which they have not proved.

Both parties knew from the outset that there were serious contests as to the facts which could not be resolved on affidavit evidence alone.

In spite of these they chose to go by way of originating summons rather than by way of an action.

Had this objection been raised at the outset by the defendant I would have readily given the appropriate directions under O. 28 r. 8 of the Rules of the High Court 1980 (See Yip Shou Shan v. Sin Heap Lee-Marubeni Sdn. Bhd. (SP No. 24-120-93 unreported)).

It is too late in the day to do that now.

Emko has totally failed to prove its case that it is entitled to charge a flat rate of RM60 per month from November 1987, and it has not provided any other evidence from which I can determine what other sum, if any, I should order the defendant to pay.

This application is therefore dismissed. I must make it clear that such dismissal is confined to Emko's claims for these charges only up to the date this originating summons was filed i.e., 6 December 1990.

Up to that date therefore the matter will be res judicata and from Emko's point of view a write-off.

In all the circumstances of this case I make no order for costs because the defendant has also raised issues which he has not sustained.

Since this is a test case my order of dismissal applies equally to SP 24-538- 90, 24-542-90, 24-544-90, 24-545-90 and 24-546-90. They are also dismissed with no order as to costs.

It would not be out of place for me to make one final observation.

So long as these defendants and all the other residents continue to live in these townhouses their contractual liability under the sale & purchase agreements will continue.

There is nothing to stop Emko filing a fresh action to recover from these defendants arrears accruing from 6 December 1990 and as against the others such arrears as are not barred by limitation.

Unless an appropriate payment is made it would be unreasonable to expect Emko to continue to provide satisfactory services.

It is to be hoped that this judgment has shown the need for sufficient transparency in the mutual dealings of the parties if a modus vivendi is to be reached.

After all the total cost of the services provided and a fair and justifiable proportion thereof is only a matter of arithmetic for a competent quantity surveyor whose professional integrity is acknowledged by all concerned.

 

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