Hi,

Few years back, i bought an apartment. My S&P states that it was suppose to be done in April 2020. However, the progress is very slow, end up not able to finish on time. Around 1 year before April 2020, i start to receive notice of force majeure from developer citing delay in completion date. After that, i keep receive a lot of that letter from them. To date, the amounts of days cites is around 90 days. Including the MCO and RMCO days, it will amount to nearly 270 days and counting!

Anyone know if it legal for them to cite so many days of force majeure? At this rate, i am worried the final LAD that i am entitled to would be 0.

Apartment S&P Agreement (SPA) is under Housing Development Act (HDA). So you are protected by the law. Read up your SPA especially on Extention of Time, LAD and Termination.

1. Delivery of Vacant Possession: 36 months from SPA date.

2. Force Majeure: "non performance due to unforeseen circumstances" (such as MCO) can't be used for SPA, as decided by the Federal Court. Your developer has no grounds to use this.

3. Extention of Time: Developer can extend time to VP if you agree. Some developers obtained approval from Ministry of Housing to extend 1 year, but it is ONLY VALID IF they had notified purchaser and obtained their views otherwise it is invalid, as decided by the court. If purchaser agreed for whatever reason, must point out to developer such EOT only for time to complete work but LAD calculation is unchanged.

4. Covid-19 Act: 18 Mar 2020 to 31 Aug 2020 (167 days) excluded from #1. Developer need to apply from Ministry of housing.

5. LAD: Federal Court had decided it is FROM date of payment of booking fee (not date of SPA signing). TO Notice of VP (provided CCC already issued), not date of handover keys. If Notice of VP is issued before CCC then it shall be based on CCC date. DEDUCT #4.

6. Claim at: i) Tribunal of Homebuyers Claims (up to RM50,000) or ii) Court. Claim at Tribunal must be made within 12 months of CCC, of DLP expiry or SPA termination depending what you are claiming.

7. Consult: you can try any of i) Homebuyers Association (HBA), not sure if they are active thou, ii) Tribunal, iii) Ministry of Housing, iv) lawyer

8. Termination: If developer delay or suspend work > 6 months, purchaser can terminate the SPA and get full refund.

You are definitely entitled to LAD. It won't be 0.

At which completion stage when you received the 1st letter and what is the current situation ?

I am more concern whether the developer are in financial stress to complete the project and may throw in the towel and call it a day. That will be financial nightmare for buyers to service the bank loan without VP.

Since you mentioned the VP month is Apr 20, it should be just the final touch up before handing over then as all major work would have completed. Since mco kicked in in Mar 20, it had delayed the work nevertheless, but I dont see how the final touch up can carry on for over 1 year.

Btw, how many units is the project and if a high % are not sold, it may also affect the financial viability to complete the project.

Post #2 had error, info updated below:

4. Covid-19 Act: 18 Mar 2020 to 31 Aug 2020 (167 days) excluded from #1. Developer need to apply from Ministry of housing. They could apply to extend till 31 Dec 2020.

5. LAD: For Delay from Completion Date to Actual VP Date (and deduct #4). Federal Court had decided Completion Date is 36 months from date of payment of booking fee (not date of SPA signing). Actual VP Date is date of Notice of VP (provided CCC already issued), not date of handover keys. If Notice of VP is issued before CCC then it shall be based on CCC date.

Ya, it could be developer financial woes. So whether it will just be delayed or abandoned project, TS need to assess. If late must have valid reason or with purchaser consent. If abandoned, can go for Termination. But developer can play trick, do minor work every 6 months and repeat the cycle to avoid project being labelled as abandoned. It would be good if TS can find fellow purchasers, form a group to share and discuss.

Termination is not an easy option for purchaser as it involved the bank in most cases.

In any abandoned projects, purchasers always get the raw deal. If one is lucky, the receiver might found a white knight to salvage the project which may need additional payment from purchasers. But how long it takes, is difficultt to predict.

Is always a higher risk to buy from developers and because of the various incentives, many are trapped unknowningly or otherwise.