Developer’s Late Delivery and LAD Claims in Malaysia: City of Green Case (2025)
Summary
- The High Court in 2025 reaffirmed key principles under Malaysia’s Housing Development (Control and Licensing) Act 1966 (HDA) and Schedule H Sale and Purchase Agreements (SPAs).
- Late delivery of vacant possession (VP) is calculated from the date of booking fee, not SPA signing — following PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah [2021] 2 CLJ 441.
- Developers may deliver VP with a valid Certificate of Completion and Compliance (CCC) — a partial CCC (Form F1) alone is insufficient.
- Purchasers who have accepted LAD settlements are generally barred from further claims, consistent with Pinpoint Consortium (M) Sdn Bhd v Mammoth Empire Land Sdn Bhd [2020] 10 MLJ 60.
- Developers must still comply with SiFUS and strata title applications, but delays alone may not imply bad faith.
- The case demonstrates the High Court’s balanced approach — protecting homebuyers while recognising developers’ compliance with statutory and contractual duties.
Introduction
In Malaysia’s rapidly growing property market, disputes over late delivery of condominium units and liquidated ascertained damages (LAD) have become increasingly common. These issues are particularly complex where developments involve multiple phases, stakeholder lawyers, and delays in strata title applications.
In August 2025, the High Court of Malaya at Shah Alam delivered a detailed and significant judgment in Wong Sii Ling & Ors v BJ Homes Development Sdn Bhd & Ors [2025] CLJU 1992 — often referred to as the City of Green Case. The decision provides vital clarification on the legal rights and obligations of developers, homebuyers, and stakeholder solicitors under the Housing Development (Control and Licensing) Act 1966 (HDA) and Housing Development (Control and Licensing) Regulations 1989 (HDR).
For both developers and purchasers, this judgment is a timely reminder that clarity, documentation, and compliance remain crucial in housing development projects.
At JY Ko Advocates & Solicitors, our litigation team regularly advises clients across Kuala Lumpur and Selangor on property disputes, LAD recovery, and developer–purchaser litigation. This article breaks down the City of Green decision in a clear and accessible way, explaining its implications for developers, purchasers, and professionals in the housing industry.
Background of the Case
The dispute arose from two consolidated suits (BA-22C-21-07/2020 and BA-22C-30-09/2020), collectively involving 74 plaintiffs — purchasers of condominium units in the City of Green development in Bukit Jalil, Selangor.
The plaintiffs had purchased their respective units under Schedule H Sale and Purchase Agreements (SPAs). Their claims were directed against:
- BJ Homes Development Sdn Bhd — the developer (1st Defendant),
- Lee Su Ha — the registered landowner (2nd Defendant), and
- Messrs Ganesh & Co and its partners (3rd to 5th Defendants) — appointed stakeholder solicitors.
The plaintiffs were divided into three main groups:
- Group 1: Purchasers who did not accept any LAD payments;
- Group 2: Purchasers who accepted LAD settlements;
- Group 3: Purchasers who took delivery of VP within 48 months of their SPA.
The plaintiffs alleged, among others, that:
- The vacant possession was delivered late, and the developers wrongfully calculated time from the SPA instead of the booking fee;
- The developers had wrongfully issued a partial CCC (Form F1) instead of a full CCC (Form F);
- The stakeholder solicitors prematurely released 5% of the purchase price contrary to SPA terms;
- The developers delayed strata title applications; and
- Purchasers were entitled to additional LAD, despite some having already accepted prior settlements.
The defendants disputed these claims, arguing compliance with the SPA and regulatory framework.
Key Legal Issues Before the Court
The High Court identified several central issues:
- Whether there was any cause of action against the landowner (2nd Defendant).
- Whether the SPA’s 48-month delivery period (for VP) was lawful, or whether it should be read as 36 months under Schedule H.
- When was vacant possession truly delivered — upon issuance of Form F1 (partial CCC), Form F (full CCC), or actual handover?
- Whether LAD should be calculated from booking fee or SPA date.
- Whether purchasers who had accepted LAD settlements could claim additional amounts.
- Whether stakeholder solicitors had breached their obligations.
- Whether developers had properly initiated strata title applications (SiFUS).
Court’s Findings and Legal Reasoning
1. No Cause of Action Against Landowner (2nd Defendant)
The Court found that the landowner was not liable merely for being named in the SPA. Under Clause 25(3) of Schedule H, the party responsible for delivery and LAD is the vendor (developer), not the proprietor.
Although the plaintiffs argued that the landowner was the alter ego of the developer, this was not pleaded, and the Court cited Samuel Naik Siang Ting v Public Bank Bhd [2015] 8 CLJ 944, reiterating that parties are bound by their pleadings. The claim against the 2nd Defendant was dismissed.
This part of the judgment emphasises the importance of pleadings and contractual clarity — a key reminder for litigation lawyers and developers alike.
2. Whether the Delivery Period Should Be 36 or 48 Months
The plaintiffs contended that delivery of VP should follow the 36-month limit under Schedule H of the HDR, not the 48-month period stated in their SPA.
However, the Court applied the Federal Court’s decision in Obata-Ambak Holdings Sdn Bhd v Prema Bonanza Sdn Bhd [2024] 8 CLJ 519, holding that the earlier Ang Ming Lee & Ors v Menteri Kesejahteraan Bandar [2020] 1 CLJ 162 decision — which had declared Regulation 11(3) ultra vires — applied only prospectively.
Therefore, since the developer’s SPA was signed before the Ang Ming Lee decision, the 48-month delivery period remained valid.
This reaffirmed the principle that developers are entitled to rely on the law as it stood at the time of contracting, preventing retrospective disruption to the housing industry.
3. Date of Delivery of Vacant Possession (VP)
A central dispute revolved around whether VP delivered with Form F1 (partial CCC) was valid. The plaintiffs claimed Form F1 implied the property was incomplete, and therefore, VP was not properly delivered.
The Court reviewed Chau Chee Sing & 143 Others v R & F Development Sdn Bhd [2021] 1 LNS 1799, which held that VP based on partial CCC was invalid.
However, in this case, evidence showed that Form F1 was issued in error — not because the building was incomplete, but due to a technical misstep later corrected by Form F dated 3 July 2018.
Judge Sumathi Murugiah J found that Form F1’s issuance was purely technical, and that the property was already safe and fit for occupation when VP was handed over on 20 June 2018.
Thus, the Court ruled that VP was effectively delivered on 3 July 2018, the date of the full CCC (Form F).
This nuanced finding underscores that each case depends on the facts — a mere clerical error in certification does not automatically invalidate VP delivery.
4. When Does the 48-Month Period Begin? Booking Fee or SPA Date?
The Court aligned with the Federal Court’s decision in PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah & Anor [2021] 2 CLJ 441, holding that:
“Where there is a delay in the delivery of vacant possession, the date for calculation of LAD begins from the date of payment of the booking fee, not from the date of the SPA.”
This means that developers must calculate the 36- or 48-month completion period from the booking date — not the SPA execution date.
For developers, this case reinforces the need for precise record-keeping and internal tracking of booking payments, as these dates directly affect potential LAD exposure.
For homebuyers, this decision strengthens their right to claim LAD from the earliest point of commitment, closing loopholes that previously disadvantaged purchasers.
5. Entitlement to LAD and Interest
The Court ordered the 1st Defendant (developer) to pay LAD to purchasers in Group 1 and Group 3 for delivery of parcels exceeding 48 months from the date of booking fee to 3 July 2018.
Additionally, the Court directed the developer to pay LAD for delay in completion of common facilities, at 10% per annum of 20% of the purchase price — again calculated from booking date to 3 July 2018.
Interest was awarded at 5% per annum on both categories of LAD, from the date of judgment until full settlement.
This finding reaffirms the Court’s consistent stance that LAD is a statutory right, not a discretionary one. Developers must be cautious when managing multiple project timelines to avoid costly cumulative LAD liabilities.
6. Purchasers Who Accepted LAD Settlements Cannot Claim More
A major point of contention involved plaintiffs who had previously accepted partial LAD settlements.
They argued that such settlements were less than the statutory entitlement (10% p.a. of purchase price) and thus invalid, citing Ang Ming Lee and Loh Tina & Ors v Kemuning Setia Sdn Bhd [2020] 7 CLJ 720*.
However, the Court distinguished these cases, holding that entering a settlement agreement does not constitute “contracting out” of a statutory right.
Relying on Pinpoint Consortium (M) Sdn Bhd v Mammoth Empire Land Sdn Bhd [2020] 10 MLJ 60, the Court reaffirmed that parties are free to enter settlement agreements under Section 64 of the Contracts Act 1950, so long as there is no misrepresentation, duress, or illegality.
Since no evidence of undue influence or coercion was presented, the Court found the settlements valid and binding, dismissing further LAD claims.
This is a vital precedent for developers, confirming that amicable settlements reached in good faith are enforceable — provided the process is transparent and voluntary.
7. Strata Title and SiFUS Application Compliance
Another issue concerned whether the developer had genuinely initiated the SiFUS (Formula Unit Share) application and subdivision for strata titles as required under the Strata Titles (Amendment) Act 2013.
The plaintiffs alleged that the SiFUS application was filed only to trigger the release of stakeholder monies, not for actual strata title processing.
However, the developer produced credible evidence — including testimony from a land surveyor — proving that a RM1.9 million deposit was paid to the Land Surveyors Board in February 2019 and that the application was indeed genuine.
Although there had been a withdrawal and later resubmission in March 2024 due to corrections (conversion of tandem to side-by-side car parks), the Court accepted that the delay was administrative, not fraudulent.
Importantly, the Court clarified that the SiFUS process was not even a legal requirement before 2015 — it only became mandatory following the 2013 amendments. Hence, the Court found the developer had complied in substance with the SPA and statutory obligations.
For both developers and purchasers, this part of the judgment provides valuable context:
- Developers must ensure proper documentary evidence of every procedural step (SiFUS, submission, payment receipts).
- Purchasers should verify progress via official land office records rather than relying on assumptions of delay.
8. Stakeholder Solicitors’ Duties and Liability
One of the most sensitive aspects of the City of Green case involved the stakeholder solicitors, Messrs Ganesh & Co and its partners, who were sued for allegedly prematurely releasing 5% of the purchase price in breach of the SPA’s stakeholder clause.
The Court carefully reviewed the evidence and the terms of the Third Schedule of Schedule H SPA, which specifies the timeline and conditions under which stakeholder monies can be released.
Since the delivery of VP was held to be valid as of 3 July 2018, and the SiFUS application had been properly made in March 2019, the Court concluded that the release of stakeholder monies was lawful and justified.
Justice Sumathi Murugiah also emphasised that stakeholder solicitors owe a professional duty to release funds only in accordance with the SPA. Any deviation would expose them to serious legal and disciplinary risks (Toh Theam Hock v Kemajuan Perwira Management Corporation Sdn Bhd [1988] 1 MLJ 116).
The Court also reaffirmed that stakeholder monies cannot be used to pay LAD claims, referencing Toh Ai Shi v Talent Team Sdn Bhd [2023] 7 MLJ 262, where the Court held that such funds are held in trust for all purchasers and cannot be diverted to satisfy one party’s claim.
Ultimately, the plaintiffs were ordered to pay RM40,000 each to the 3rd–5th defendants (the solicitors), reinforcing the need for clear evidence before alleging professional misconduct.
9. Final Orders and Outcome
After considering all arguments and evidence, the High Court made the following orders (summarised):
- Delivery of VP — within 48 months from the date of booking fee, not the SPA date.
- Common facilities — also within 48 months from the booking fee.
- LAD for Groups 1 & 3 purchasers — payable for delays beyond 48 months (from booking fee to 3 July 2018).
- LAD for common facilities — payable to all purchasers, calculated on 10% per annum of 20% of the purchase price.
- Interest — 5% per annum on LAD amounts from the date of judgment until full settlement.
- Costs — RM60,000 payable by the developer to the plaintiffs; each group of stakeholder solicitors awarded RM40,000 costs.
- Landowner (2nd Defendant) — no liability; to bear own costs.
The final judgment (delivered on 15 August 2025) provides one of the most comprehensive treatments of late delivery, LAD computation, and stakeholder responsibility in recent Malaysian jurisprudence.
Implications of the Judgment
A. For Homebuyers
This judgment reinforces several protective principles for Malaysian homebuyers:
- Booking Fee Is the Trigger Point – LAD begins from the booking fee, ensuring purchasers aren’t disadvantaged by delays between booking and SPA signing.
- Form F Is Essential – Developers must ensure that VP delivery is supported by a full CCC (Form F), not just a partial CCC (Form F1).
- Evidence Matters – Purchasers must keep payment receipts, booking records, and correspondences; these documents are critical in proving timelines.
- Settlement Agreements Are Binding – Once purchasers accept LAD settlements, further claims are barred unless there’s proof of misrepresentation or coercion.
- Professional Advice Is Crucial – Before accepting settlements or signing waivers, purchasers should consult a lawyer experienced in housing development disputes to evaluate actual entitlements.
At JY Ko Advocates & Solicitors, our team often assists purchasers in verifying whether their LAD payments were properly computed and whether any contractual or statutory breaches exist. We also act in negotiation and litigation for LAD recovery, delivery disputes, and post-handover defects.
B. For Developers
For developers, the case offers valuable compliance guidance:
- Documentation Is Key – Maintain dated records for booking fees, CCCs, and correspondence. The burden of proof often shifts to the developer in LAD disputes.
- Avoid Contracting Errors – Ensure all SPA clauses align with Schedule H and that any modification has written approval from the Controller of Housing.
- Settlement Agreements – When settling LAD claims, ensure that the settlement is transparent, documented, and voluntarily accepted. Courts will uphold genuine settlements.
- Strata Title Compliance – Developers must not only commence SiFUS and strata applications but also maintain evidence of deposits and submissions to authorities.
- Stakeholder Coordination – Work closely with stakeholder solicitors to ensure all release conditions are met; premature releases can expose both parties to risk.
The High Court’s approach shows an appreciation for commercial realities — it protects compliant developers while penalising negligence or deliberate noncompliance.
C. For Conveyancing Lawyers and Stakeholders
The decision also underscores the professional obligations of lawyers acting as stakeholders.
Stakeholder solicitors are fiduciaries; their duty is to hold and release monies strictly under the terms of the SPA and relevant legislation.
Failure to do so could constitute a breach of trust and expose them to civil suits or Bar disciplinary proceedings. However, the City of Green case confirms that when stakeholders act in accordance with the SPA and official approvals, courts will not lightly interfere.
For law firms handling large housing projects, this judgment reinforces the importance of meticulous escrow management and transparency in communication with developers and purchasers alike.
Legal and Commercial Significance
The City of Green judgment is one of the most important housing development rulings since PJD Regency and Obata-Ambak. It harmonises several competing principles:
- It protects homebuyers by reaffirming that booking fees start the LAD clock.
- It protects developers from retrospective legal uncertainty caused by evolving Federal Court precedents.
- It balances fairness and commercial practicality, ensuring the law does not unduly punish administrative errors or good faith settlements.
This pragmatic approach strengthens the integrity of Malaysia’s housing industry — promoting accountability while recognising real-world challenges in project delivery.
Expert Commentary by JY Ko Advocates & Solicitors
At JY Ko Advocates & Solicitors, we view the City of Green decision as a vital precedent for civil litigation and property law practice in Malaysia.
Our legal team has handled numerous disputes involving:
- Late delivery of condominiums and landed properties,
- LAD and compensation negotiations,
- Stakeholder release and breach of trust claims,
- Strata title and SiFUS compliance issues, and
- Developer–purchaser disputes under Schedule H and G SPAs.
This judgment reflects many of the practical issues our firm advises on daily — from ensuring compliant delivery procedures to protecting clients’ contractual rights.
We believe it offers clear legal guidance and greater predictability for both developers and purchasers navigating the Malaysian housing market.
Whether you are a property developer, purchaser, or legal professional, understanding this decision will help you anticipate potential disputes and structure your transactions more securely.
Conclusion: Moving Forward After the City of Green Case
The High Court’s decision in Wong Sii Ling & Ors v BJ Homes Development Sdn Bhd & Ors [2025] CLJU 1992 has reshaped how Malaysian courts interpret LAD, CCC delivery, and stakeholder obligations.
It sends a clear message:
- Compliance with statutory contracts matters;
- Transparency and record-keeping protect both sides; and
- Good faith settlements remain enforceable.
For developers, this means embedding robust compliance systems from the booking stage to strata title issuance.
For purchasers, it highlights the importance of obtaining professional legal advice before signing or settling claims.
At JY Ko Advocates & Solicitors, our mission is to help clients resolve complex property and housing disputes with clarity, precision, and strategic foresight.
If you are facing a late delivery, LAD, or strata title issue, our lawyers can provide tailored legal solutions — whether through negotiation, mediation, or court action.
Contact JY Ko Advocates & Solicitors to make an appointment
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Disclaimer: The above proposition is subject to actual facts and circumstances and shall never be referred as the actual law without seeking legal advice. Consult us for more information!