TRIBUNAL
TUNTUTAN PEMBELI RUMAH V. WESTCOURT CORPORATION SDN BHD & OTHER APPEALS
COURT OF APPEAL, KUALA LUMPUR
[CIVIL APPEAL NOS: W-01-55-2003, W-01-54-2003, W-02-758-2003, W-02-759-2003
& W-02-760-2003]
RICHARD MALANJUM JCA, HASHIM YUSOFF JCA, TENGKU BAHARUDIN SHAH JCA
6 APRIL 2004
JUDGMENT
Richard Malanjum JCA:
On 18 December 2003 we allowed the appeals by the appellants. And upon
agreement of the parties we made no order as to costs. In giving our short
oral judgment we stated that we were unanimous in our decision. We expressed
our view that the Tribunal has the jurisdiction to entertain and to
adjudicate upon claims lodged with it notwithstanding the sale and purchase
agreements were entered into before 1 December 2002. And accordingly the
issue of retrospectivity of s. 16AD vis-a-visan award given by the Tribunal
should not arise. We also stated that we would give our reasons later. We do
so now.
These appeals arose from the decision of the court below granting the
respondents, inter alia, an order of certiorari to quash the awards handed
down by the Tribunal in respect of several claims lodged by the
claimants/homebuyers, a declaration that the said awards given were invalid,
ultra vires, null and void and of no consequence, that the Tribunal had no
jurisdiction to hear and determine the claims lodged by the
claimants/homebuyers thereof and an order prohibiting the Tribunal from
hearing such claims.
Since the issue of jurisdiction of the Tribunal in relation to sale and
purchase agreements entered into before 1 December 2002 was common to all
the appeals it was therefore agreed that we should hear them together.
We emphasize here that the issue of jurisdiction of the Tribunal is being
questioned only in relation to sale and purchase agreements entered into by
the claimants/homebuyers before 1 December 2002, a crucial date, since that
was when the Tribunal began to function vide gazette notification P.U.(B)
353/2002 ('the appointed date').
Now, it was not in dispute that the claimants/homebuyers lodged their claims
with the Tribunal for liquidated damages in connection with the late
delivery of homes purchased by them from the respective respondents, being
the licensed housing developers.
As background, the Tribunal came into existence with the passing of the
Housing Developers (Control and Licensing) (Amendment) Act 2002 (the
Amending Act). The principal statute is the Housing Developers (Control and
Licensing) Act 1966 ('the Principal Act'). And for clarity the sections
referred to in this Judgment are sections of the Principal Act as amended.
Prior to the orders rendered by the court below the Tribunal heard claims
which were brought before it irrespective of the dates of the sale and
purchase agreements. However the respondents herein held a view otherwise.
Several applications were therefore filed by way of notice of motion for
judicial review.
With the agreement of all parties the learned judge in the court below heard
one application with binding effect on the others. And on 4 September 2003
the learned judge rendered judgment wherein he granted the relief sought for
by the respondents with the net effect that the Tribunal was for all intents
and purposes rendered incapable to hear claims based on sale and purchase
agreements entered into before the appointed date.
The gist of the decision of the learned judge is that in the absence of any
express provision to the contrary the Amending Act has no retrospective
effect on sale and purchase agreements entered into before the appointed
date. He held that to do so would be an infringement of art. 7 of the
Federal Constitution in view of the provision whereby penalty could be
imposed for any failure to comply with an award handed down by the Tribunal.
Indeed the learned judge considered that any failure to comply with an award
granted by the Tribunal would merely be an extension of the breach upon
which the award was given. The learned judge was also of the view that to
allow retrospective effect of the jurisdiction of the Tribunal would result
in the substantive rights of the respondents being affected to their
prejudice.
Before us the learned Attorney General argued, inter alia, that the Tribunal
has the jurisdiction to hear and determine claims based on a sale and
purchase agreement entered into prior to the appointed date. He referred to
s. 16N(2) thereof. And he contended that s. 16R admits the possibility of a
retrospective application of the said section. He went on to point out that
assent to the Amending Act was given on 23 January 2002 followed by the
publication on 31 January 2002 but it only came into force on 1 December
2002 together with the Regulations providing for the procedure to be
observed by the Tribunal. That according to him indicates the intention of
applying s. 16N(2) retrospectively.
The reference by the learned judge to s. 32(2) of the Amending Act which
extended the application of the new s. 22C in the Principal Act as being a
specific indication of retrospective intention as opposed to the absence of
similar provision in s. 16N(2) thereof was noted by the learned Attorney
General as erroneous in view of the limited purpose of that section.
For the respondents it was submitted that s. 16N(2) has no application to
the notion of retrospectivity. That section simply serves to limit the
jurisdiction of the Tribunal where it has jurisdiction by virtue of s. 16M.
And it was further submitted that if it was the intention of Parliament to
allow retrospective effect, it would have done so by inserting a similar
provision to that of the new s. 22C of the Principal Act.
Learned counsel for the respondents gave the reasons why this court must not
construe the jurisdiction of the Tribunal as having retrospective effect.
Firstly it was contended that to do so would effectively be allowing a
criminal provision enacted into the Principal Act videthe Amending Act to
have retrospective effect in the absence of any specific enabling provision.
Learned counsel of course was referring to the provision whereby there would
be a penalty imposed for failing to comply with an award granted by the
Tribunal. Secondly the fact that a criminal provision was incorporated
should indicate that there was no intention to legislate with retrospective
effect bearing in mind the strong presumption against statutes with criminal
consequence to operate retrospectively.
The diametrically opposed contentions of the parties before us demand close
scrutiny of the relevant provisions brought about by the Amending Act. And
having done so we agree that whilst there is no provision expressly
specifying the jurisdiction of the Tribunal in respect of sale and purchase
agreements entered into before the appointed date, we do not think such fact
should be taken as affirming the argument of the respondents. To do so would
be contrary to a settled principle of law that statutes must be read as a
whole. (See: Kesultanan Pahang v. Sathask Realty Sdn Bhd [1998] 2 CLJ 559).
And literal interpretation of a statute is not applicable in all cases.
There are circumstances where the nature and purpose of a particular
legislation must be considered when construing its various provisions so as
not to defeat the intention of Parliament. (See: Akberdin Hj Abdul Kader &
Anor v. Majlis Peguam Malaysia [2002] 4 CLJ 689; SEA Housing Corporation Sdn
Bhd v. Lee Poh Choo [1982] CLJ 355; [1982] CLJ (Rep) 305).
In the instant case we are of the view that the Principal Act as amended by
the Amending Act is a piece of social legislation and hence its provisions
should be given liberal and purposive interpretation. In the case of
Kesatuan Kebangsaan Wartawan Malaysia & Anor v. Syarikat Pemandangan Sinar
Sdn Bhd & Anor [2001] 3 CLJ 547 the Federal Court speaking through his
Lordship Steve Shim CJ (Sabah and Sarawak) on the Industrial Relations Act
1967 said this at p. 554:
Quite clearly, the IRA is a
piece of social legislation whose primary aim is to promote social justice
and industrial peace and harmony in the country. As such, the approach to
interpretation must be liberal in order to achieve the object aimed at by
Parliament. This had been described by Lord Diplock as the 'purposive
approach', an approach followed by Lord Denning in Nothman v. Barnet
London Borough Council[1978] 1 WLR 220, who reiterated that in all cases
involving the interpretation of statutes, we should adopt a construction
that would promote the general legislative purpose underlying the
provision. We accept that to be the correct approach.
A similar view was also expressed
by the Federal Court in the case of Hoh Kiang Ngan v. Mahkamah Perusahaan
Malaysia & Anor [1996] 4 CLJ 687 where it was said at p. 707:
Now, it is well settled that
the Act is a piece of beneficent social legislation by which Parliament
intends the prevention and speedy resolution of disputes between employers
and their workmen. In accordance with well settled canons of construction,
such legislation must receive a liberal and not a restricted or rigid
interpretation. If authority is required for this proposition, it is to be
found in the decision of the Court of Appeal in Syarikat Kenderaan Melayu
Kelantan Bhd v. Transport Workers' Union[1995] 2 CLJ 748. The three
interconnected definitions which were cited by Salleh Abas LP in his
judgment in Inchcape as well as s. 20 (under which the instant
respondent's case was referred to the Industrial Court) appear in a
statute requiring liberal interpretation and for that reason should
themselves be liberally interpreted. per Gopal Sri Ram JCA.
Applying therefore the liberal
and purposive approach to the statutory provisions that deal with the
jurisdiction of the Tribunal we find that the argument advanced for the
respondents is premised on at least two assumptions. Firstly, that the date
in a sale and purchase agreement is material in determining the jurisdiction
of the Tribunal. Secondly, any award given for a breach of a sale and
purchase agreement entered into prior to the appointed date, particularly
where the breach was before that date, would tantamount to allowing criminal
law to operate retrospectively since it is now punishable being an offence
for any failure to comply with or satisfy such award. This argument of
course relates to the legal principle that criminal law cannot be made to
operate retrospectively unless specifically stipulated. (See: Dalip Bhagwan
Singh v. PP [1997] 4 CLJ 645).
With respect, we find the first assumption to be without any basis. There is
nothing in the provisions establishing the Tribunal or related thereto which
can be said to support it. In our view while s. 16M sets out the general
jurisdiction of the Tribunal, it is s. 16N and in particular sub-s. 16N(2)
thereof that provides the perimeter of the jurisdiction of the Tribunal.
Section 16N(2) reads:
Limitation of jurisdiction.
(1) Except as expressly ...
(2) The jurisdiction of the Tribunal shall be limited to a claim that is
based on a cause of action arising from the sale and purchase agreement
entered into between the homebuyer and the licensed housing developer
which is brought by a homebuyer not later than twelve 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 the sale and purchase agreement.
Sub-section 16N(2) does not
stipulate a cut off point by reference to date of agreement vis-a-vis
jurisdiction. All that is required of the Tribunal in assuming jurisdiction
to hear a claim presented before it is to verify whether it is within the
ambit of sub-s. 16N(2), that is to say:
(a) whether the claim is based
'on a cause of action arising from the sale and purchase agreement entered
into between the homebuyer and the licensed housing developer; and
(b) whether the claim is 'brought by a homebuyer not later than twelve
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 the sale and purchase agreement.'
We do not think there should be
any additional or prerequisite term to be read into the provision. To do so
would tantamount to adding what is not in the statute. And that should not
be done since judges are not legislators. That was echoed in NKM Holdings
Sdn Bhd v. Pan Malaysia Wood Bhd [1986] 1 LNS 79; [1987] 1 MLJ 39 with these
words:
It must always be borne in mind
that we are Judges, not legislators. The constitutional function of the
courts is not only to interpret but also to enforce the laws enacted by
Parliament. In enforcing the law we must be the first to obey it. It
should be noted that the power of a Court to proceed in a particular
course of administering justice, was one of substance and not merely of
form. The duty of the Court, and its only duty, is to expound the language
of the Act in accordance with the settled rules of construction. The Court
has nothing to do with the policy of any Act which it may be called upon
to interpret. per Seah SCJ at page 39.
In fact the need for a sale and
purchase agreement as a condition-precedent in filing a claim has also been
waived by sub-s. 16N(3) thereof which states that '(N)otwithstanding sub-s.
(2) no claim shall be affected or defeated on the ground that no sale and
purchase agreement has been entered into between the homebuyer and the
licensed housing developer at the time when the cause of action accrues if
there exists a previous dealing between the homebuyer and the licensed
housing developer in respect of the acquisition of the housing
accommodation.'
To limit therefore the
jurisdiction of the Tribunal to claims based on sale and purchase agreements
entered into after the appointed date would tantamount to restricting the
jurisdiction of the Tribunal which Parliament never intended to do so. It is
absurd in our view to say that Parliament proceeded to legislate for the
establishment of the Tribunal well aware that it would only begin to serve
its purpose a few years later since it would be inconceivable for claims to
arise on breaches of sale and purchase agreements entered into as recent as
the appointed date. Meanwhile the claims of homebuyers based on breaches of
sale and purchase agreements entered into prior to the appointed date would
continue to languish under the present set up. Surely that must have been
the very mischief which Parliament intended to address when it legislated
for the establishment of the Tribunal. As stated earlier, being a piece of
social legislation a liberal and purposive approach should be adopted when
construing the legislative provisions governing the threshold jurisdiction
of the Tribunal.
In respect of the second assumption, such approach came about in view of s.
16AD. It reads:
Criminal penalty for failure to
comply.
(1) Any person who fails to comply with an award made by the Tribunal
within the period specified therein commits an offence and shall on
conviction be liable to a fine not exceeding five thousand ringgit or to
imprisonment for a term not exceeding two years or to both.
(2) In the case of a continuing offence, the offender shall, in addition
to the penalties under subsection (1), be liable to a fine not exceeding
one thousand ringgit for each day or part of a day during which the
offence continues after conviction.
However, that section should be
read in its proper perspective and should be given a purposive
interpretation as well. At any rate nothing stipulated therein could be
understood to mean that a breach of a sale and purchase agreement between a
homebuyer and a licensed housing developer is a crimeper se. A breach only
gives a homebuyer the right to claim against a licensed housing developer.
And prior to the establishment of the Tribunal such claim could only be
filed in the civil court. In fact a claim that is not within the ambit of ss.
16M and 16N remains outside the jurisdiction of the Tribunal though s. 16O
is an exception.
Accordingly in our opinion s. 16AD only comes into play when there is a
failure on the part of a licensed housing developer to comply with an award
given by the Tribunal. In other words the criminal aspect of the provision
only arises when there is a failure to abide by an award of the Tribunal and
not due to a breach of a sale and purchase agreement upon which a claim is
made. It is in fact equivalent to an execution proceeding as generally
understood in the civil court. Thus we are not persuaded by the argument
that s. 16AD has made an award handed down by the Tribunal synonymous to a
breach of a sale and purchase agreement. A breach is a cause giving rise to
a claim while an award is a relief.
Put in another way, s. 16AD does not penalize a licensed housing developer
for a breach simpliciter of a sale and purchase agreement. The penalty only
comes into play when there is a failure to comply with or satisfy an award
handed down by the Tribunal after adjudicating a claim based on a breach of
a sale and purchase agreement irrespective of its date. That in our view is
a fair, liberal and purposive interpretation of the section. And since the
Tribunal only began to function from the appointed date the question of an
award handed down before that date and the application of s. 16AD for
failure to comply does not arise.
We are conscious of the counter-argument that without a breach in the first
place there is no question of an award being given by the Tribunal and
without an award there is no issue of penalty arising. And if a breach
occurred before the appointed date that would effectively be criminalizing
an act retrospectively.
With respect, a distinction should be drawn between a breach of the sale and
purchase agreement and an award rendered arising from such breach. As we
have stated earlier on it is not the breach of the sale and purchase
agreement that has been criminalized. Rather it is the failure to comply
with or satisfy any award given by the Tribunal in connection with any claim
made pursuant to such breach. At any rate section 16AD does not empower the
Tribunal to impose any penalty. It only provides for a defaulter to be
subject to prosecution which invariably is the task of another authority in
a separate criminal proceeding. And on being prosecuted a defaulter is at
liberty to raise in defence the inapplicability of the section to him. Such
approach was successful in the case ofEnergoprojek (M) Holdings v. PP [1996]
4 CLJ 571. Accordingly, we do not think s. 16AD is intended to take away any
substantive right of any person. Neither is it meant to affect or limit the
jurisdiction of the Tribunal in any manner howsoever.
The reference to s. 22C thereof by way of comparison to indicate the
intention of Parliament is irrelevant in our opinion. That provision is only
an enabling section in relation to another matter and is not related to the
issue of jurisdiction of the Tribunal. Section 22C provides:
Right to initiate and maintain
actions.
Notwithstanding anything contained in any written law or any rule of law,
a homebuyer as defined in section 16A shall be entitled on his own
volition and in his own name to initiate, commence, institute and maintain
in any court or tribunal any action, suit or proceeding against a housing
developer or any other person in respect of any matter arising out of the
sale and purchase agreement entered into between the purchaser and that
housing developer unless a contrary intention is expressed in any
agreement, assignment or charge between the homebuyer and his financier in
which case the prior written consent of his financier must first be
obtained before he exercises any of his rights under this section.
(2) Every agreement, assignment or charge lawfully entered into between a
purchaser and his financier before the appointed date shall be subject to,
and the parties thereto shall be entitled to the benefits of, the new
section 22C of the principal Act as inserted into the principal Act by
subsection (1).
It was also the contention of
learned counsel for the respondents that in view of the penalty attached
with the establishment of the Tribunal, to allow it therefore to hear a
claim based on a sale and purchase agreement entered into before the
appointed date would affect and prejudice the substantive rights of the
respondents.
In our view such argument is focused on the presence of the penalty for
default in complying with an award handed down by the Tribunal. And for the
reasons we have given hereinabove, in particular, on the penalty
vis-a-visthe award issue, we do not think it has any merit.
It is to be noted that the establishment of the Tribunal is in effect a
creation of another forum intended for speedy disposal at a minimum cost of
prescribed claim up to the limit of RM25,000 by a homebuyer against a
licensed housing developer for breach of a sale and purchase agreement
entered into by the parties. There is therefore no question of the rights of
anyone being eroded or removed as was envisaged in The Colonial Sugar
Refining Company, Limited v. Irving[1905] AC 369 (PC). (See also: Lim Phin
Khian v. Kho Su Ming [1996] 1 CLJ 529).
And although it may be argued that the imposition of penalty has a
prejudicial effect, such preposition may be true if it is the breach of a
sale and purchase agreement that has been criminalized. But here it is not
the case.
As regards the other points raised in the course of the argument we have
considered them but in view of our conclusion herein there is no necessity
for us to expressly deal with each one of them. It would not alter our
conclusion in any event.
Accordingly for the foregoing reasons we allowed the appeals.
My learned brothers have read this judgment in draft and agree with its
contents.
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