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LAW CASE: Raja Lob Sharuddin

b. Raja Terzali & Ors v Sri

Seltra Sdn Bhd

1.0 Introduction

In Malaysia, housing development is an industry that inclines and declines through

time. Housing development in Malaysia revolves the acquisition of land state, the planning
stage, the application for approval, the construction stage, the sales stage, the completion
stage, the post-completion stage and the defect liability stage. There are many cases
pertaining to housing development, and this assignment later to discuss case Raja Lob
Sharuddin b. Raja Ahmad Terzali & Ors v Sri Seltra Sendirian Berhad in planning law

2.0 Case Background

The 45 plaintiffs, who bought double storey terrace houses in Taman Nirwana Fasa
2, Ampang, Selangor claimed that their houses were not built according to specifications
and suffered from poor workmanship. The plaintiffs therefore engaged a registered
engineer to prepare a report detailing the defects. However, the defendant testified had
obtained all the required planning and development approvals from the relevant
government agencies and had also engaged professional consultants. But, the defendant
failed to adduce any professional evidence to dispute the engineering report by the
plaintiffs. In fact, the defendant questioned the credibility of the report and alleged that
the defects in the plaintiffs’ houses appeared well after the defects liability period which
therefore the plaintiffs had no cause of action against the defendant. The High Court judge
agreed that the engineering report is lack in credibility. The judge thus ruled that the
plaintiffs had failed to prove their case and dismissed their claims with costs. The plaintiffs
appealed to the Court of Appeal, and it is allowed with costs.

3.0 Inter-relation between planning and the case

This case can be related to several legal acts pertaining to housing development,
such as Street, Drainage and Building Act 1974 and Housing Developer (Control and Licensing
1996 (Act 118). From this case, clearly be seen that Uniform Building By Law 1984 Act 138
(fall under the principle law of Street, Drainage and Building Act 1974) is the most dominant
legal document to be referred as a substantiation. Act 138 consists of nine parts which are:
LAW CASE: Raja Lob Sharuddin
b. Raja Terzali & Ors v Sri
Seltra Sdn Bhd

Part I: Preliminary
Part II: Submission of Plans For Approval.
Part III: Space, Light, and Ventilation.
Part IV: Temporary Works in Connection with Building Operations.
Part V: Structural Requirements.
Part VI: Constructional Requirements
Part VII: Fire Requirements.
Part VIII: Fire Alarms, Fire Detection, Fire Extinguishment, and Fire Fighting Access.
Part IX: Miscelleneous.

The engineering report prepared by the professional civil engineer after do the
inspection regarding the defects of construction in 45 houses respectively. Comparison
between built houses and the drawing plan prepared by architect, engineer, and
specification contract are the basis in the report preparation. From the case background,
the defendant claimed that he did received approval for the development plan from
government agencies. This is one of the compulsory stages to acquire approval, as the
developer must submit several plans such as subdivision, earthworks, layout, building,
engineering and landscape. Only after they receive approval they can start land clearing
on the project site. Ironically, the houses built did not comply with the specification given
and even different from the plan submitted to the government agencies before. Some of
the defects found in the plaintiffs’ houses that contradict with the original submitted plans

i. The house buildings do not conform to prepared plan – for example the difference
floor level measurement between master bedroom and bathroom floor is 2inch at
minimum but it was done less than 0.5 inch.
ii. The floor thickness do not fulfill the practiced specification
iii. Wall separating the houses do not comply with Uniform Building By Law where the
stated thickness is 9inch and there is a hole in the ceiling between two houses that
do not satisfy safety aspect during fire.
iv. Wrong technique arrangement of floor results unstable floor
LAW CASE: Raja Lob Sharuddin
b. Raja Terzali & Ors v Sri
Seltra Sdn Bhd

Those are some defects from the 10 types listed in the report. The defects were
serious defects and they were structural defects to the houses. Such defects were the type
that would only become apparent at a late stage. However, the defendant argued they
engaged professional consultant and the materials used followed the appropriate
materials according to the advice given by the architect. The plaintiffs’ action failed
because the defects were discovered after the expiry of the defects liability period.

The question that we have to determine is whether the clause 23, about defects
liability in Sale and Purchase Agreement should be construed and applied against
purchasers of houses. It began with the passing of the Housing Developers (Control and
Licensing) Act 1966. In 1982, the Housing Developers (Control and Licensing) Regulations
came into force. Regulation 12(1) provides that no amendment to any contract of sale shall
be made except on the ground of hardship or necessity and with the prior approval of the
controller. In other words all the provisions in the sale and purchase agreement are actually
statutory requirements which must be strictly complied with. Clause of 23 is meant to be an
additional protection for house buyers, without affecting or limiting their rights under the
common law.

Latest amendment 2007, Section 25(4) Uniform Building By Law state “Nothing
contained in this by-law shall prevent the local authority or any officer authorized by it in
writing for the purpose, from inspecting any building works at any stage thereof and
calling attention to any failure to the building or non-compliance with these By-laws which
he may observe and, giving notice in writing to the principal submitting person ordering
such failure or non-compliance to be rectified.”

The above section shows that local authority can always supervise the development
under their territory to avoid incongruence between on the ground project and approved
plans submitted. Some developers as this case for instance, may take advantage to reduce
cost in housing delivery process by using low quality of building material and later give
adverse effect to the house buyers.
LAW CASE: Raja Lob Sharuddin
b. Raja Terzali & Ors v Sri
Seltra Sdn Bhd

4.0 Conclusion

The major players involved in the housing production process are government,
developers, professionals or consultants, contractors or builders. Each of these key players
plays a very important role in the various stages of the housing production process. More
important than their individual roles is degree of co-ordination also checks and balances in
the relationships of these players that would determine the efficiency and transparency of
the housing delivery system.

There are quite a few amendments to related law on housing development and the
latest on 2007, amendments to The Street, Drainage and Building Act (Act A1286) and
amendments to The Uniform Building By-Law. As many aspect need to be improved and
added, those amendments are vital in planning realm. This may help to protect the rights
of users especially the house buyers.
LAW CASE: Raja Lob Sharuddin
b. Raja Terzali & Ors v Sri
Seltra Sdn Bhd

5.0 References

Malayan Law Journal (2008), Raja Lob Sharuddin bin. Raja Ahmad Terzali & Ors v Sri
Seltra Sendirian Bhd. Malaysia.

Mohamad A. Mohit (2008), Housing Studies Lecture. Malaysia.

Roslan Omar (2008), Uniform Building By Law Presentation. Malaysia: JKR

Headquarters, KL.

The Association of Consulting Engineers, Malaysia.