Putrajaya residents demand full compensation from govt-linked developer over late delivery of homes

KUALA LUMPUR, March 23 — A group of residents in Malaysia’s administrative capital Putrajaya are seeking full compensation from a government-linked developer over late delivery of completed homes bought, insisting that the compensation be calculated from when the deposit was paid instead of when the agreement to buy the homes were signed.

In a statement today, the Persatuan Penduduk Presint 12 Murayya Putrajaya (PPP12P) sought help from Housing and Local Government Minister Datuk Zuraida Kamaruddin and her ministry (KPKT) to push for developer Putrajaya Homes Sdn Bhd to pay the full amount of Liquidated Ascertained Damages (LAD) or compensation to the homebuyers of completed units in the Pinevalley and Turnberry projects in Precinct 12, Putrajaya.

“Therefore, in this present scenario involving a housing developer of elite status owned by a government subsidiary, PPP12P pleads for intervention from YB Minister and KPKT to instruct the developer to pay the remaining LAD that has yet to be paid.

“The calculation of total days of delays for the LAD should take into account the movement control order (MCO) period and also start from the date deposit was received by the housing developer,” the association said in a statement today.

The association noted that the Federal Court had on January 19, 2021 ruled in cases involving three other housing developers that the calculation of LAD to be paid by them for late delivery of vacant possession of housing units is to start from the date of payment of booking fees, instead of from the date of the sale and purchase agreement.

However, the Putrajaya residents’ association PPP12P said that developer Putrajaya Homes Sdn Bhd — which comes under Putrajaya’s master developer Putrajaya Holdings Sdn Bhd — has denied the right of Pinevalley and Turnberry homebuyers to full compensation through the LAD. (Putrajaya Holdings Sdn Bhd’s website said its shareholders comprise national oil firm Petronas, Kumpulan Wang Amanah Negara and Khazanah Nasional Berhad.)

Instead, these housebuyers were only paid LAD from the date of the sale and purchase agreement’s signing until the date of delivery of keys, but excluding the MCO period, the association said.

“No explanation or apology from the developer was given over the shortfall in LAD payment,” the association said, adding that the housebuyers had no choice but to bring this matter to the Tribunal for Homebuyer Claims to protect their rights and claim for the full LAD payment.

Although the sales and purchase agreement stated that the LAD had to be paid immediately, the housebuyers said no payment was made when the keys were delivered, the association said.

The association said the housebuyers were disappointed with the developer’s attitude as they had to bear costs due to the delayed completion of houses amid the Covid-19 pandemic, on top of delays in repairs of defects.

According to the association, the housebuyers had filed their claims at the tribunal before the government gazetted a new law which would allow housing developers to not include the March 18 to August 31, 2020 period when calculating LAD to be paid to housebuyers.

The new law is the Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (Covid-19) Act 2020, which was gazetted on October 23, 2020. Under the new law, Section 35 excludes the period of March 18 to August 31, 2020 from the period used to calculate LAD that has to be paid by developers over the delay in delivering vacant possession of houses to buyers, regardless of what was written in the agreement between developers and housebuyers.

Also under Section 35, a housing developer can apply for extension of time (EOT) from the housing and local government minister, while the minister can grant the developers’ applications for EOT by extending the period up to December 31, 2020 for the delivery of vacant possession of the houses to buyers.

The Putrajaya Precinct 12 residents’ association said the housebuyers had objected to the National Housing Department over the developer Putrajaya Homes’s application for an EOT to exclude the MCO period from being used to calculate the LAD amount, but said no response has been forthcoming from the housing and local government ministry.

The tribunal later heard the housebuyers’ claims and on September 22, 2020 rejected the claims by the housebuyers’ against Putrajaya Homes for the full LAD amount.

This was despite Section 37 of the new law which was highlighted to the tribunal, the association said.

Section 37 states that the modifications in provisions such as Section 35 shall not affect any legal proceedings to recover LAD payable by the developer during the period from March 18 until the new law’s October 23 publication date.

The association then concluded by appealing for an intervention by Zuraida and her ministry.