guidelines on the 3 rd schedule of the standard sale

GUIDELINES ON THE 3rd SCHEDULE OF THE STANDARD SALE & PURCHASE AGREEMENTPAM Continuing Professional Development CPD Seminar7th April 2011 PAM Northern Chapter Penang.

Pertubuhan Akitek Malaysia

Ar Chan Seong AunM Arch (Distinction), B Arch (Hons), B Bdg Sc (VUW, NZ), APAM, AIPDM, TAM

Architect’s Certification for Stage Completion

1. Housing Development Act 1966

2. Schedule-G – Landed Properties

3. Schedule-H – Subdivided Buildings

4. Issuance of CCC – Certificate of Completion and Co mpliance


5. FAQs – Frequently Asked Questions

Pertubuhan Akitek MalaysiaPertubuhan Akitek Malaysia

HOUSING DEVELOPMENT ACT 1966

Overview of the Housing Process

• One Stop Submission & Approval - OSC• Four Stage Process• Conversion & Sub -Division


• Conversion & Sub -Division• Planning approval• Building Plan approval• Issuance of CCC• More than 12 laws• 8 Approving Authorities

COMMITTEE MEMBERS OF THE OSCCHAIRMAN : MAYOR / YDPSECRETARY : OSC DIRECTOR / PLANNERMEMBERS AS BELOW

• 1. Deputy Mayor

• 2. Four Ordinary Members of the Council

• 3. Director of State Urban and Town Planning

• 4. Director of Mineral and Land


• 4. Director of Mineral and Land

• 5. Land Administrator

• 6. Director of Public Works

• 7. Director of Department of Drainage and Irrigation

• 8. Director of Department of Environment

• 9. Director of Department of Fire Fighter and Life Saving


• 10. Director of Department of Sewage Services

• 11. Manager of Tenaga Nasional Berhad

• 12. Manager of Telekom Malaysia Berhad

• 13. Manager of Department of Planning

• 14. Manager of Department of Building

• 15. Manager of Department of Engineering


• 16. Manager of Department of Landscape

• 17. Manager of Department of Health

• 18. Technical Departments that are related are invited

Laws Controlling the Housing Development Process

• National Land Code (Act 56) 1965

• Town & Country Planning Act

• Drainage Works Act (Act 354), (Revised 1988), 1954


• Drainage Works Act (Act 354), (Revised 1988), 1954

• Sewerage Services Act

• Street, Drainage & Building Act (Act 133), 1974

• Uniform Building By-Laws 1984

• Housing Developers (Control and Licensing) Act 1966 (Act 118)

• Housing Developers (Control and Licensing) Regulati ons 1989

• Housing Developers (Housing Development Account) Regulations 1991

• Housing Developers (Control and Licensing) (Amendme nt) Act 2002

• Housing Developers (Control and Licensing) (Amendme nt) Regulations 2002


Regulations 2002

• Housing Developers (Housing Development Account) (Amendment) Regulations 2002

• Strata Titles Act 1985 (ACT 318)

• Strata Titles (Federal Territory of Kuala Lumpur) R ules 1988

•Part I defines what is “housing development” – more than 4 lots•Part II requires Developers to be licensed and minimum paid up capital•Part III defines the basic duties of a housing developer including the opening and maintenance of the Housing Development Account•Part IV Investigation and enforcement•Part V Powers of Minister to give directions to safeguard the interest of purchasers

Principal HDA 1966


•Part V Powers of Minister to give directions to safeguard the interest of purchasers•Section 13A Controller to report the conduct of and Architect or Engineer•Part VI Tribunal for Home Buyers Claims•Part VII Miscellaneous covers fines for offences and liability of directors, managers and other officers•Section 24 empowers the Minister to make regulations

Housing Development Act 1966

Housing Dev Account Reg 1991

Tribunal forHouse Buyers

Housing Dev Regulation


Account Reg 1991Reg 2002

Strata Titles Act1985

1989

Strata Titles Act2007

•Regulation 11 – standard contract of sale – required that the Standard Sales and Purchase Agreement (Schedule G & H) must be used.•Schedule-G Standard Sale and Purchase Agreement f or land and building•Clause 4 – Schedule of Payment•Part 1 Installment payments in the time and manner set out in Third Schedule of the SPA

Housing Development Regulations 1989


Schedule of the SPA•Part 2 Notice to purchaser supported by certificate signed by vendor’s Architect or Engineer and this shall be sufficient proof of completion•Clause 13 – Position and area of the lot•Part 2 states Vendor may claim up to maximum 2% deviations.•Part 4 No alterations are allowed•Clause 14 – Materials and workmanship to conform to description•Building to be constructed in a good workmanlike manner

•Clause 15 – Restriction against variation by purchaser.•Until after CCC/CFO•Clause 16 – Restriction against change of colour scheme•Clause 21 – Compliance with written laws.•Architect has to ensure compliance with UBBL and Street Drainage Building Act



Building Act•Clause 19 – New laws affecting housing development•Developer to absorb any additional costs•Clause 19 – Time for handing over of vacant possession•24 months for landed property•Clause 21 – Manner of delivery of vacant possession•Clause 20 – Defects liability period•24 months from date of handing over vacant possession.

Note•Building description as set out in Fourth Schedule - the specifications of finishes, fixtures and fittings•Approved building plans as in Second Schedule – Key document is the approved building plans•No changes or deviations without the written consent of



•No changes or deviations without the written consent of the purchaser except as required by appropriate authority•If changes or deviations involve the substitution or use of cheaper materials or omission of works, purchaser is entitled to corresponding reduction in price or damages

Further References

Copies of the Housing Development (Control & Licensing ) Acts can be found at the following websites

• www.rehda.org.my

• www.hba.org.my


Relevant Lembaga Arkitek Malaysia circulars:

•General Circular 1/2008 (CCC)

•General Circular 1/2010 (Borang-F1)

•General Circular 3/2008 (Stage Cert Guide AFTER 1-12-07)

Major amendments to the Act on 1st December 2002

• Section 2(1)(a) Includes cooperative societies such as PKNS, etc

• Section 8A – Statutory Termination of S&P Agreement – Works not started after 6 months & >75% Purchasers agree to terminate

• Section 13A – Controller can report unsatisfactory conduct of Architect or Engineer directly to their respective Boards


Architect or Engineer directly to their respective Boards

• Section 16(a) – 16(I) Tribunal for House buyers Claims – Claims up to RM 25,000. Decision of Tribunal to be final. Criminal penalty for failure to comply

• Third Schedule Stage 2(f) changed to 2(f), (g),(h) for sewerage, drains and roads.

Major amendments to the Act on 17th April 2007

• Section 24 Delivey of VP changed from after COF application is accepted by Local Authority to issuance of CCC by Principal Submitting Person

• Section 25 – DLP has been extended from 18 to 24

• SCHEDULE G&H – 2(e) Instead of the plastering which


• SCHEDULE G&H – 2(e) Instead of the plastering which applies to walls only, the “internal & external finishes” have to be completed. This would include, the painting of walls and the floor finishes and the building would be almost completed before Architects can certify for completion of this

• Fourth schedule - Fencing and turfing is now optional under the new amendment. Internal telephone trunking and cabling is not optional

Core Reasons These Laws Were Passed .• The key reason for the Housing

Developer’s Licensing Act is to protect the rights of the purchaser.

• The key objective of the Uniform Building


• The key objective of the Uniform Building by-Laws is the protection of public safety and health .

Preparing for Certification

• Check to whether the project is within the COF or CCC version of the Housing Developers Act. If BP approval condition is COF, then apply for COF and use Circular 4/2003

• Check the details of the S&P Agreements to ensure


• Check the details of the S&P Agreements to ensure compliance with approved building plans and contract documents, especially dimensions, floor areas and description of finishes.

• Check against Lembaga Arkitek Malaysia Circulars 1/2008, 2/2010 & 4/2003 or 3/2008

HOUSING CERTIFICATION


HOUSING CERTIFICATIONSCHEDULE-G LANDED PROPERTIES

Stages of Certification – Schedule -GLanded Properties

STAGE WORKS TO BE COMPLETED

WORKS NEED NOT BE COMPLETED

2(a) The foundation and

Foundation works below lowest floor level

�Retaining wall if it is not part of the foundation


foundation and footing works of the said Building

10%

lowest floor level�Piling & Pilecaps �Raft Slab�Footing�Stumps

part of the foundation�Backfilling�Lowest floor slab NOT part of the foundation�Ground Beams�Services

C&S Engineer is to certify completion and compliance of structuralcomponents before Architect’s Certification

STAGE 2(a) QUESTION

C&S Engineer has confirmed completion of the foundation works. Based on the Engineer’s letter the Architect has certified completion of Stage 2(a) even though the stumps have not been completed. This is a mistake by the Engineer. Will the Architect still be held responsible?

YES. LAM can only hold the Architect responsible. LAM can not hold the Engineer responsible no more than LAM can hold the Architect’s staff responsible for any mistakes made by them.


The Engineer may be disciplined later by LJM but the Architect is not absolved of the responsibility of checking for the completion of the works.



2(b) The Reinforced concrete framework of the said building

15%

�All Primary RC structural elements above lowest floor level�Beams, Columns & suspended slabs�Roof Beams�Structural walls

�Non-structural ground floor slabs w or w/o BRC�Stiffeners�Lintols�Non-structural RC�Hoods, aprons, gutters, parapets


�Structural walls �Retaining walls forming part of the structure

parapets�RC staircases�RC walls not part of the frame

Formworks do NOT need to be removedRoof beams must be completed

C&S Engineer is to certify completion and compliance of structuralcomponents before Architect’s Certification


If the roof structure doe not have sloping RC beams as in this structure, then the RC structure has been completed and stage 2(b) certificate can be issued. If however there is a sloping RC roof beam, then this beam must be cast before RC structure can be considered to be completed.

STAGE 2(b) QUESTION

The RC frame of a bungalow project has been completed. A week later the first floor beams observed to have some structural cracks. Engineer issues additional structural drawings. Can the stage 2(b) certificate be issued prior to the completion of the additional works / rectification works?

If the Architect has been kept informed about the status of the structural works, it is obvious that the structural works had NOT been satisfactorily


works, it is obvious that the structural works had NOT been satisfactorily completed. NO certificate under stage 2(b) can therefore be issued.



2(c) Walls of the said Building with with Door & Window Frames placed in position

10%

�Non-structural walls �All Party Walls including Stiffeners�TIMBER Door & Window Frames�FRAMEWORK for Partitioning excluding lining

�Metal Frames�Door leaves�Window Panels�Window Louvres�Parapet walls�Timber door & window frames where sub-frames are provided


lining frames are provided�Boundary walls�Fence Walls�Closing up of construction openings

The above is for Circular 3/2008

Although metal window frames need not be installed at this stage, Architects often face complaints and queries from Purchasers



2(d) Roofing, Electrical wiring, plumbing,gas piping, internal telephone trunking and cabling to the said building

�Roof structure, roofing & flashing including car porches

�Electrical wiring �Water piping �Sanitary piping incl bends joints & traps

�Ceiling boards�Switch Boards�Switches�Electrical fixtures & Fittings�Sanitary & Tap fixtures & Fittings�Hot Water heaters


said building

10%

bends joints & traps�Gas piping �Telephone trunking

�Hot Water heaters�Water tanks�Rain water down pipes�Gutters�Window Hoods



2(e) Internal & External Plastering of the said Building

10%

�All plastering to walls, soffits, slabs, beams, columns where specified�Wall tiles�Linings, boards and panels to framed partitions�Ceiling

�Floor screeding and floor finishes�Painting and other finishes except wall tiles�Closing up of temporary construction openings�Tiling or plastering to side of staircases


�Ceiling side of staircases�Ceiling to water tank area


STAGE 2(e) QUESTION

“Wall tiling” is not included in the S&P wording – why does the LAM guideline specifically only tiling. What about other forms of tiling like marble, stone, etc. and other new wall finishing materials?

The LAM guidelines were formulated to reduce uncertainty for Architects in their certification. Since the wall tiles are normally installed to replace the plastering, it would be logical that these must also be completed along with the plastering. The same would apply for any marble, stone and new


finishes that replace the plastering.

Note that wall paper, spray tiles, etc which replace painting are not include in this phase as they do not replace the plastering but are applied on top of it.



2(e) Internal & External Finishesof the said Building including the wall finishes

10%

�All plastering to walls, soffits, slabs, beams, columns where specified�Wall tiles & Other wall finishes�Linings, boards and panels to framed partitions

�Closing up of temporary construction openings�Door & Window panels


partitions�Floor screeding & other floor finishes�Painting to internal & external Walls Floors & Ceiling



Under the CCC system, ALL Building works have to be completed under stage 2(e) except external works



2(f) Sewerage works serving the said building

5%

�Sewerage reticulation connected to�Completed Sewage Treatment Plant temp or Permanent approved by the relevant authority

�Testing & commissioning�Water & electricity connection


•Sewer Treatment Plant may be Permanent or Temporary•Sewer line must be connected to last manhole•Last Manhole must be completed. Inspection Chambers need NOT be completed



2(g) Drains serving the said building

5%

�Drains & Main Drains connected to outfall

�Metal gratings & drain covers


•Alignment of drains and outfall may be Permanent or Temporary as approved by JPS or relevant Local Authority•Perimeter drains serving the said building



2(h) Roads serving the said building

�Paved Road leading to building from existing road�Permanent roads around the building �Entrance culvert serving the said building�Kerbs

�Footpaths�Roadside tables�Final wearing course to pre-mixed roads�Road markings�Road signages


�Kerbs

•Alignment of Roads may be Permanent or Temporary access as approved by Local Authorities

HOUSING CERTIFICATION


HOUSING CERTIFICATIONSCHEDULE-H STRATA PROPERTIES

Stages of Certification – Schedule -HSub-divided Building



2(a) The Work Below Ground Level of the said

Foundation works below lowest floor level�Piling & Pilecaps

�Retaining walls if not part of the foundation�Backfilling


Level of the said Buildingcomprising the said parcel including foundation of the said building

10%

�Piling & Pilecaps� Stumps�Raft Slab�Footing & Stumps

�Backfilling�Lowest floor slab NOT part of the foundation�Ground Beams�Services

C&S Engineer is to certify completion and complianc e of structural components before Architect’s Certification

STAGE 2(a) QUESTION

The development consists of 4 wings of apartments interlinked to common service cores. Do the works below ground level of all 4 wings have to be completed before we certify for stage 2(a) or can they be certified on a wing by wing basis.

If the 4 wings are “structurally independent” and they have been defined as 4 independent buildings / blocks they can be certified on a “building” by “building” basis. If however they all sit on a common structural podium and


is one integral structure, then the whole podium foundation must be completed for certification for stage 2(a)



2(b) The structural framework and floor slab of the said parcel

15%

All primary structural elements above lowest floor level including�Beams�Columns�Suspended slabs�Structural walls

�Non-structural ground floor slabs with or without BRC�Wall stiffeners & Lintols�Non-structural RC�Hoods, aprons, gutters, parapets


�Structural walls�Roof Beams

�Retaining walls forming part of structural element

Of the said parcel

parapets�Staircases including that in the common area�RC walls that do not form part of the structural framework

Formworks do NOT need to be removed


Shear walls form part of the primary RC structure and must be completed under stage 2(b)


Ground, 1st, 2nd and 3rd floor can be certified under stage 2(b)



2(c) Walls of the said parcel with Door & Window Frames placed in position

10%

�All non-structural walls within parcel�All Party Walls inclusive of wall Stiffeners�TIMBER Door & Window Frames where there are no sub-frames�All FRAMEWORK for

�Metal Frames�Door leaves�Window Panels�Window Louvres�Parapet walls�Boundary walls�Fence Walls�Closing up of


�All FRAMEWORK for dry Partitioning excluding lining of partition

�Closing up of construction openings�Timber door & window frames where sub-frames are provided


Parapet walls need NOT be completed for stage 2(c)

Walls required for construction access need NOT be completed for stage 2(c)




2(d) Roofing/Ceiling, Electrical wiring, plumbing,gas piping, internal telephone trunking and cabling to the

�Roof structure, roofing & flashing, or�Floor slab soffits & ceiling framing of the said parcel

�Electrical wiring within parcel

�Ceiling boards�Switch Boards�Switches�Electrical fixtures & Fittings�Sanitary & Tap fixtures & Fittings�Hot Water heaters


cabling to the said parcel

10%

parcel�Water piping within parcel�Sanitary piping within parcel�Gas piping within parcel�Telephone trunking & cabling within parcel

�Hot Water heaters�Water tanks�Rain water down pipes�Gutters�Window hoods


1st floor has been completed to stage 2(d) if services are complete



2(e) Internal & External Finishes of the said parcel including the wall finishes

10%

�All pastering to walls, soffits, slabs, beams, columns where specified�Wall tiles & other wall finishes�Linings, boards and panels to framed partitions

�Closing up of temporary construction openings�Door & window panels


partitions�Floor screeding and/or other floor finishes�Painting to internal & external walls, floors and ceilings (if any)



2(f) Sewerage works serving the said building

5%

Sewerage works including manholes from the building containing the said parcel connected to a completed sewerage treatment system ( The treatment system may be permanent or temporary

�Testing & commissioning�Water & electricity connection�Refer page 18/18 of circular


permanent or temporary as approved by the relevant authority)

Sewer Treatment Plant may be Permanent or Temporary



2(g) Drains serving the said building

5%

Drains & Main Drains connected to outfall(The alignment of drains and outfall may be Permanent or Temporary as approved by the local authority)

�Metal gratings & drain covers


Perimeter drains serving the said building must be completed



2(h) Roads serving the said building

�Paved Road leading to building containing the said parcel from an existing road.(The alignment of Roads may be Permanent or Temporary access as approved by Local

�Footpaths�Roadside tablets�Final wearing course to pre-mixed roads�Road markings�Road signages


approved by Local Authorities)�Permanent roads around the building containing the said parcel�Entrance culvert serving the building�Kerbs


Vacant possession can not be issued yet as the bulk meter has not been installed yet

CCC


CCCCERTIFICATE OF COMPLETION & COMPLIANCE

CCC can only be issued by the Principal Submitting Person (PSP) after the following have been secured:1. All the certifications by the respective parties (professionals, contractors and licensed tradesmen) based on the prescribed ‘Form Gs’ under the Matrix of Responsibility (Forms G1 – G21); and

4.1 ISSUANCE OF CCC


2. Clearances from the following authorities :•Tenaga Nasional Berhad (TNB)•Water Authority•Sewerage Services Department (JPP)•Fire and Rescue Department (except for residential buildings of not more than 18 meters high)•Department of Safety and Health (where applicable),•Relevant authorities/Public Works on Roads and Drainage.

•The local authorities still maintain their rights and power to enter the siteduring construction and issue an order to stop the issuance of CCC by the PSP if the construction on site is found to have br eached the approved building plans and/or against the provision of UBBL or conditions of building plans approval on health and safety issues until su ch time the fault is corrected.•The issuance of CCC is restricted to only technical issues concerning

ISSUANCE OF CCC


•The issuance of CCC is restricted to only technical issues concerning health, safety and essential services. The non-tech nical issues such as bumiputra quota, low cost provision and contributio n for public facilities etc are outside the purview of PSP and will have to be resolved between the Owner and the Local Authorities at the planning and building plans approval stage or via other mechanism.•There will be only CCC (Form F) and Partial CCC (Fo rm F1). There will be NO Temporary CCC similar to Temporary CF.•The issuance of CCC will only apply to projects in which building plans are submitted after CCC came into force.

4.2 BUILDING QUALITY AND CCC

• Can Architects issue the CCC when there are still outstanding defects?


• Can an Architect decide that a minor defect is acceptable under the Standard S&P?

ARCHITECT

HOUSE BUYERTRIBUNAL

Contractual relationship of parties in Housing Sell then Build


CONTRACTORHOUSING

DEVELOPERHOUSEBUYER

STDSPA

PAMCONTRACT

STANDARD SALES & PURCHASE AGREEMENT FOR HOUSING

Clause (14) Materials and Workmanship to Conform to Description states “….shall be constructed in a good and workmanlike manner in accordance with the description set out in the Fourth Schedule and in accordance with the plans approved by the Appropriate Authority

�The approved Building Plan is a very important point of reference


�The approved Building Plan is a very important point of reference as far as quality is concerned�The Architect does not have the powers under the standard S&P to make the final decision regarding quality - Tribunal for House has that power

UNIFORM BUILDING BY-LAW 1984

UBBL in itself does not mention quality requirements and so long as the quality of the building element does not affect the “safety and health” aspect of the building , there is no directly implied responsibility for the quality aspect of the building.


CERTIFICATE OF COMPLETION & COMPLIANCE

Why BCA issue Temporary Occupation Permit (TOP) whe re workmanship is poor?

The TOP signifies that the completed building works have complied with the provisions of the building regulation, which focus primarily on human safety, and with the requirements of the various technical authorities, so that the completed building can be occupied.


However, TOP does not ensure that materials have been accordance to the Sale & Purchase (S&P) agreement or quality of works as promised in sales document. These disputes should be brought directly to and resolved with the developer.

PAM 98 CONTRACT

Quality standards in Architectural components cannot yet be definedabsolutely and requires the discretion of the Architect. The PAM98contract also empowers the Architect to make the final decisionon quality with “ reasonable discretion”.

The powers of the Architect however are not absolute, as theContractor can refer any matter in the contract including qualitymatters to arbitration as outlined in clause 43.1(1) “…..including any


matters to arbitration as outlined in clause 43.1(1) “…..including anymatter or thing left by this contract to the discretion of the Architect”.

Under the PAM form of Contract therefore the Architect decideswhether the quality of works are acceptable and NOT the Employer

PAM 2006 CONTRACT

Quality standards in Architectural components cannot yet be definedabsolutely and requires the discretion of the Architect. The PAM2006contract also empowers the Architect to make the final decisionon quality but refers more to the Contract in clause 6.1 “…shal lbe to the respective quality and standard described in thecontract document and required by the Architect….”

The powers of the Architect however are not absolute, as the


The powers of the Architect however are not absolute, as theContractor can refer any matter in the contract including qualitymatters to arbitration as outlined in clause 34.5(b) “….. any matter leftby the contract to the discretion of the Architect”.

Under the PAM 2006 form of Contract also the Architect decides whether the quality of works are acceptable and NOT

the Employer but quality shall be as described in the contract

• Rising Damp 33%

• Defective Framing 20%

• Illegal Building 30%

• Timber Rot 46%

Typical building faults…Typical building faults…Typical building faults…Typical building faults…


• Timber Rot 46%

• Cracking Brickwork 43%

• Electrical Problems 34%

• Roofing Faults 54%

• Water Problems 15%

Inspection Checklist for Clerk of Works

A comprehensive QC checklist ensures works a properly completed for every stage of works.


CONDITIONS TO BE COMPLIED BEFORE VACANT POSSESSION CAN BE GIVEN

1. Architect has issued CCC - Certificate of Completi on and Compliance

2. Water and electricity supply is ready for connect ion3. Purchaser has paid all monies due under clause 4( 1) in

accordance with the 3 rd schedule4. Purchaser has performed and observed all terms an d convenants

on his part under the S&P


on his part under the S&P

FAQ


FAQFREQUENTLY ASKED QUESTIONS

5.1WHAT ARE THE MOST COMMON HOUSE BUYER COMPLAINS ?

• Late Delivery

• Non- payment of compensation for late delivery


delivery

• Defective workmanship & construction quality

• Non-conformance to approved plans

Number Of Complaints Received by States by Types Fo r Year 2000

No. Types Of Complaints/States

SGR PLS P.P PRK KED N.S MEL JOH W.P KEL TRG PHG TOT AL

1. Defective Workmanship 82 0 26 12 14 14

7 18 28 0 0 11 212

2. Compensation 124 0 28 14 6 4 0 0 60 0 1 10 247

3. Payment 20 0 15 6 4 8 9 7 23 0 0 0 92

4. CFO 47 0 4 3 1 1 0 1 26 2 1 9 95

5. Late Delivery Of Houses 97 0 38 24 15 24

14 24 83 12 1 16 348

6. Interest 40 0 4 1 3 14 5 17 9 0 1 4 98

7. Not Conforming To Plan 14 0 10 6 1 0 1 3 98 0 0 2 135

8. Service 20 0 17 5 2 4 2 3 51 4 2 3 113


9. Cheating 2 0 1 3 1 2 0 0 8 0 0 0 17

10. Deposit/Ownership 21 1 5 2 1 1

4 4 13 0 0 2 54

11. Infrastructure 0 0 3 0 0 1

0 0 1 0 0 1 6

12. Contravene Act/Regulations 12 0 15 7 9 2 0 1 9 1 0 2 58

13. Others 177 1 50 27 15 9

0 5 32 4 3 25 348

Total656 2 216 110 72

84 42 83 441 23 9

85 1823

5.2EOT UNDER HDA CLAUSE 32

• Are Developers entitled to request for waiver of interest on late delivery if their Contractors delay the works or there is a


Contractors delay the works or there is a shortage of materials for construction?

• SEA Housing Sdn Bhd vs Lee Poh Choo [1982](2 MLJ 31) in which the purchaser sued the developer for breach of contract and for delivery of the title to a house he had purchased. The property in question was completed after 23 months, instead


was completed after 23 months, instead of 18 months as stated in the SPA

The developer relied on Clause 32 of the agreement, which purported to exempt it if non-fulfillment of any term was caused by circumstances beyond its control. The High Court trial judge held that the 1966 Act and the 1970 Rules were passed by the authorities to protect the interests of the


authorities to protect the interests of the public and the developer could not contract out of the Rules. The developer's appeal to the Federal Court was dismissed. To date there have been no cases where Developers have been exempted for late delivery penalties.


The Contractor and House Buyer have NO direct contractual relationship.

5.3CAN A DEVELOPER JUST PASS THE HOUSE BUYER DEFECTS LIST TO THE CONTRACTOR ?


direct contractual relationship. Contractors are therefore NOT obliged to take instructions from house buyers about their defects complains

ARCHITECT

HOUSE BUYERTRIBUNAL

Contractual relationship of parties in Housing Sell then Build


CONTRACTORHOUSING

DEVELOPERHOUSEBUYER

STDSPA

PAMCONTRACT

MORALETHICAL

MANAGING CHANGES & UNCERTAINTY


STUTATORYREQUIREMENTS

CONTRACTURALISSUES

2. I hereby certify that the following amounts are still needed to satisfy the Developer Obligations:-

(a) An amount needed to comply with conditions of Certificate of Fitness (Where Temporary Certificate is issued)

Architect

(b) An amount needed to obtain separate Document of Title

Surveyor

(c) An amount needed for the cost and expenses of Developer

5.4 Release of Residual monies after CCC / CFO


(c) An amount needed for the cost and expenses of maintaining, up keeping and repairing the areas reserved for roads, open spaces, electricity substation, septic tanks and other communal amenities, until the same is taken over by the Appropriate Authority.

DeveloperQS

(d) An amount needed to keep purchasers Indemnified against fines, penalties or looses incurred by reason of any breach of the provision of any written law relating to the Housing Development.

Developer

(e) An amount needed to rectify any defects, shrinkages, or other faults in the said Building, which may become apparent within a period of twelve (12)/ eighteen (18) months after the date of handing over vacant possession (which amount should be in addition to the amount held by the Developer’s Solicitor as stakeholder.)

ArchitectQS

(f) An amount needed as outstanding Developer’s solicitor’s cost.

LawyerDeveloper

(g) Administrative expenses. Developer


(g) Administrative expenses. Developer

(h) Any other cost which has not been spelled out, asabove which the architect may deem necessary.

Balance may deem necessary Architect

Balance of payment to contractor ArchitectQS

Balance of payment to consultant Consultants

Total (a) to (h) Architect

Add 10% for the contingencies and inflation

5.5 NON-COMFORMANCE TO APPROVED PLANS

What if the parcel height is constructed less than that shown in the approved Building Plan? Can the Purchaser NOT accept the apartment?

Clause 11(1) of the S&P allows for “errors” in position and area of the parcel and states “The position. Measurement, boundaries and area of the said parcel as given are believed but not guaranteed to be correct and if its measurement, boundaries and area as shown in the Building Plan shall be different from that shown in the strata title when issued, the purchase price


of the said parcel calculated at the rate stipulated in section 6 of the fifth schedule shall be adjusted accordingly.

Based on this clause, the Purchaser is entitled to pro rata compensation and according to clause 11(2) “Any payment resulting from the adjustment and required to be paid by the party concerned shall be so paid within 14 days of the issue of the strata title.”

TYPE 1999 2000 2001 2002 2003 2004 2005 TOTAL %Certification 32 14 9 17 8 16 12 108 53%Defects 5 9 4 2 2 4 0 26 13%Supplanting 1 3 0 1 0 2 0 7 3%Delay in Obtaining CFO 5 0 0 0 0 0 1 6 3%

Housing Complains Against ArchitectsSource : Lembaga Arkitek Malaysia


Collabration with NonRegistered Person 1 0 0 0 0 0 0 1 0%Non-approved Practice 0 0 0 0 0 0 0 0 0%Unprofessional Conduct 4 4 4 8 9 12 14 55 27%TOTAL 48 30 17 28 19 34 27 203 100%

Housing Complains Against Architects1999-2005Source : Lembaga Arkitek Malaysia

Unprofessional Conduct27%


Certification54%

Defects13%

Supplanting3%

Delay in Obtaining CFO3%

Collabration with NonRegistered Person

0%

Non-approved Practice0%

THANK YOUQ&A


Q&[email protected]

guidelines on the 3 rd schedule of the standard sale

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