The following exemption orders were made pursuant to the announcement of PENJANA initiative by the Federal Government to tackle the recovery of the country’s economy as a result of the COVID-19 pandemic. We have prepared a table below for your easy reference:

Our team of lawyers will be happy to assist you if you require further clarification.

On 23^rd October 2020, the Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (COVID-19) Act 2020 (“COVID Act“) was finally gazetted and came into operation on the same day.

The COVID Act was introduced by the government as an effort to provide temporary measures to individuals and companies to reduce the impact of COVID-19 pandemic.  The COVID Act is split into 19 parts and generally in force for two years from 23^rd October 2020, unless otherwise provided for in each part.

In this article, we focus on Part 11 of the COVID Act on modifications to the Housing Development (Control and Licensing) Act 1966. One must be reminded that the Housing Development (Control & Licensing) Act 1966 cited in the COVID Act is only applicable in West Malaysia. Sabah has its own Housing Development (Control & Licensing) Enactment 1978 and the corresponding Housing Development (Control & Licensing) Rules 2008. Unless and until a separate law is passed in the Dewan Undangan Negeri in Sabah, Part 11 of the COVID Act is not legally applicable in Sabah. 

In Malaysia, only residential developments are regulated under the housing development laws. Commercial developments do not fall within the ambit of these housing laws and are largely reliant on the terms of the contractual agreement signed between the developer and the individual purchaser.

We have nonetheless compiled in this article a summary of the modifications made under Part 11 of the COVID Act:

• Only applicable to agreement in the forms prescribed in Schedules G,H,I & J of the Housing Development (Control & Licensing) Regulations 1989 entered into before 18^th March 2020;[1]
• Developer shall not impose late payment charges if purchaser fails to pay instalment for the period from 18^th March 2020 to 31^st August 2020. Purchaser may apply to the Minister for extension of time, and if satisfied, extend the period up to 31^st December 2020;[2]
• The period from 18^th March 2020 to 31^st August 2020 shall be excluded from computation of the time for delivery of vacant possession and the liquidated damages for developer’s failure to delivery of vacant possession. Developer may apply to the Minister for extension of time, and if satisfied, extend the period up to 31^st December 2020;[3]
• Purchaser shall not be deemed to have taken vacant possession of the residential property if delivered between 18^th March 2020 to 31^st August 2020 if purchaser unable to take possession during that period;[4]
• The period from 18^th March 2020 to 31^st August 2020 shall be excluded from the calculation of defects liability period. Purchaser may apply to the Minister for extension of time, and if satisfied, extend the period up to 31^st December 2020. [5]

Nonetheless, Part 11 shall not have any effect on any legal proceedings which were commenced, or any judgement or award were obtained to recover late payment charges or liquidated damages prior to 23^rd October 2020.[6] Similarly, any late payment charges (by purchaser) or liquidated damages (by developer) which have been validly paid before 23^rd October 2020 shall not be refunded to the other party. [7]

If you have any questions or require any additional information, please contact us.

(Updated as at 19th April 2021 – The Temporary Measures for Reducing the Impact of Coronavirus Disease 2019 (COVID-19) Enactment 2020 (No. 5 of 2020) applicable in Sabah was finally gazetted and came into effect on 14th January 2021. Please click on this article for the details – https://csylegal.com/sabahs-housing-developers-rejoice-the-sabah-covid-enactment/)

[1] Section 33 of the COVID Act 2020
[2] Section 34 of the COVID Act 2020
[3] Section 35 (1), (2) & (3) of the COVID Act 2020
[4] Section 35 (4) of the COVID Act 2020
[5] Section 36 of the COVID Act 2020
[6] Section 37 (1) of the COVID Act 2020
[7] Section 27 (2) of the COVID Act 2020

This case decides that a joint management body (JMB) formed pursuant to the Strata Management Act 2013 (“SMA”) has no power to fix and impose different rates of maintenance charges for different types of parcels comprised in a mixed development project.

The reason is that the share units allocated to a parcel is calculated according to formula set out in the First Schedule of SMA which takes into consideration of different weightage factors. The legislative framework under the First Schedule of SMA is intended to avoid inequitable, unfair and discriminatory practice in determining maintenance and maintenance charges rate. Hence, a JMB shall fix one rate of management charges which is applicable to all types of parcels in proportion to the allocated share units.

Commentary:-

• This case is to be viewed with caution in the Sabah’s context as the SMA is not applicable in the State of Sabah.
• The relevant law governing management of subsidiary titled development in Sabah is the Land (Subsidiary) Title Enactment (Sabah No. 9 of 1972). Under this Enactment, the allocation of share units are allocated by the landowner, as approved by the Director of Lands and Surveys – unlike the share unit computation in Peninsular Malaysia which is based on a set of formula set in stone under the SMA.
• It would also be interesting to note that in Sabah, it is not mandatory to compute the management charges based on share units.
• It has yet to be seen on any court’s interpretation in light of the provisions of the Enactment  in terms of the relationship between the allocated share units and different rates of management charges. Although the share units are assigned by the landowner in Sabah’s context, it is a prudent approach to adopt an equitable, fair and non-discriminatory practice in determining maintenance or management charges rate.

Should you have any queries as to how these developments may affect your business, please do not hesitate to get in touch with us at csylegal.kk@gmail.com