Dario, thank you for your reply.

Vendor's lawyer mentioned that there have been scenerios whereby consent took up to 9 months. Said he has to protect vendor's rights and insist on 1 year. (this is even with an additional 3 months extension) My lawyer agreed. Reason why I am concerned is that I get the impression that vendor thinks he can take his time through the paperwork. Because he's not living in Malaysia, he mentioned that he'll come back around end of Feb to sign the snp. And this is only snp stage....sigh...

Is there really no win win situation in this matter? Is there any clause I can add to protect myself. My lawyer is not being very helpful...

15 months is too long,brother! 
Thanks for the input.

Bro, clause (1) is redundant is there is no need to ask for an undertaking by the vendor. If you don't mind me asking respectfully, do you understand the nature of an undertaking? It is a well-abused term which even lawyers use for no basis whatsoever. You'd be surprised!

For things like consent, it is the vendor's DUTY to do so within the stipulated period. If he fails and an extension is needed, the completion date would be automatically extended, to the benefit of the purchaser. The vendor doesn't need to UNDERTAKE to do it. He HAS to do it. It's compulsory.

Clause (2) must be there in every agreement. If consent is not granted the agreement is of no further effect and parties are restored to their previous position. Status quo, essentially.

Clause (3) would be of no effect as the vendor has a total of (for example) 6 months to obtain consent. It doesn't matter even if he undertakes to apply within 14 days.

Clause (4) - it is still the vendor. No changes there. Standard procedure.

Now, in an S&P, the underlying assumption and general rule is that the vendor would want to dispose off his property soonest possible and thus, you would notice that any delay by the vendor would result only in an extension of time to the purchaser, but any delay by the purchaser would entail a late penalty interest.

Some people might suggest that the vendor would want to 'delay' things and 'take his own sweet time to obtain state consent', but such arguments does not really hold water in reality because:

1) The purchase price is fixed. If during the period in which consent is pending, the market value increases, the vendor loses out. This is the BIGGEST risk that the vendor faces  ;
2) The vendor would still have to make his monthly instalment payments to his financier while consent is pending  ;
3) The reality of inflation and the depreciation in money - the longer it takes for the transaction to complete, the longer it would take for the vendor to obtain the balance purchase price to commit himself to a new purchase. There is a possibility that his intended new purchase would've increased in price as well during that period  !

Hope the above clarifies things. What do you think? 

My lawyer asked me to pay stamp duty for 5 copies of S&P, is it a normal practise for 5 copies ?

One copy for seller and one copy for buyer so why need 5 copies ?

Why 4 copies when only 2 is enough ?

wow dario...very good legal advice....are you a lawyer in practice?

What do you mean by blanket approval,bro?

Hi, need some advice on my Loan Documentation fees charge from the lawyer. My loan amount is RM400k and i manage to deal at RM6k, is it still expensive?

I'm trying to purchase a shop lot.
can i know how is the s&p + stamp duty, loan legal fee +stamp duty, MOT will be calculated?
what else shall i aware of when signing s&p?

as from what i read here mostly are on resident property
Pls advise.

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Added on January 26, 2011, 11:20 pmshop lot i meant is the shop lot in a shopping mall

Also, from my previous understand. the s&p for shop lot is non standard, can i know what shall i notice in s&p doc? as i'm lack of knowledge in law. Lots of agreement just sign with no so understand.

oic.. dario is professional in s&p? when he is coming back?

if for the property i put my wife name and i me is the borrower for the loan

is there any diff if i put property with mywife and my name? and also for the loan?

heard that it iwll be cheaper if put both name? is that right?

Tsuyoshi, the delay in replying to your query is because I can't seem to get my hands on a copy of the Malay Reservations Enactment of any State, for that matter. 

Generally, the requirements around disposal of a Malay Reservation Land (MRL) is very very strict.

The developer must be a 'Malay holding' within the definition of the respective Enactment. The chargee bank must also be within the similar definition.

When it comes to purchasers, it must be strictly only those who fall under the definition of Malay. From what I remember reading ages ago, the Selangor Enactment does not give any right to dispose a MRL to a non-Malay. The Kelantan Enactment, in contrast, has a provision for disposal to a non-Malay, subject to the consent of the Ruler-in-Council. Not too sure as to the actual wording of the provision, though.

As such, the issue of blanket authority/blanket consent in such developments does not arise as it will contradict the strict requirement of the Enactment, rendering it redundant and academic.

I'm not sure if there are many developments on MRL. As far as I know, it is mostly individual lots given to individuals. A lot of MRL are in rural areas. I doubt if there are MRL in hotspots or developing areas. Correct me if I'm wrong though.

In reality, you do find certain developments with a bumi quota, probably around 30%, of a high-rise development, for example. What happens if the quota is unsold and you want to open it to non-bumis? Then that particular purchaser has to apply for consent from the state authority. You can look at the 30% as somewhat of a MRL as well, but this time, the requirement is not stringent. It can be transferred to a non-bumi as long as state authority's consent has been given. 

First thing which you must understand is that the terms of a contract is based on the understanding and mutual agreement of both parties. So, there's nothing the law can do to 'remove' that paragraph if it is merely unfair or unjust to you. If parties have executed it, then parties would be bound by it.

There are exceptions, of course - if there was undue influence, duress, mistake, or if the contract itself is based on something illegal.

Coming back to the issue at hand - what you have now is a Condition Precedent. It means that the contract will only kick off when you have obtained a loan within the time frame stipulated. If you can't obtain a loan an extension of time may be granted subject to the agreement of both parties.

Unless this condition is fulfilled, the contract would not kick off. The Ringgit XXXX sum would most probably be the balance 7% or 8% deposit.

So, unless you get a loan within the time period, the balance deposit would not be given to the vendor.

However, this clause is poorly drafted as it doesn't state the consequences if you fail to obtain a loan OR if the vendor does not want to grant you an extension of time after the 21 days have lapsed.

Unless there is another clause somewhere, or if there's a clause 3.3 which you have not inserted here.

What happens if you fail to obtain a loan? Would the 2% or 3% earnest deposit be refunded? Would the vendor be entitled to forfeit it? Perhaps you can check with the lawyer if it is not covered elsewhere in the contract.

On a final note - If you think that you need more than 21 days to obtain a loan - tell your lawyer to amend the draft and see if the vendor agrees to it. 

1. Your 10% would be forfeited, unless there is a clause which provides for a refund in the event you fail to obtain a loan for the 90%. Check your SPA. You must note that the vendor has the option to go for specific performance against you, i.e. to compel you to proceed to purchase the property at the price of RM550K as agreed in the SPA.