Schedule H Lecture

● Sch G only applies when the buyer buys landed property from developer
● Sch H generally applies when the buyer buys high rise unit (aka parcel) from the
developer
○ NOTE: Parcel in Sch H is intended for housing accommodation
● There are situations where even if the buyer buys a high rise building from the
developer, he does not have to sign Sch H (sch H is not applicable).
○ Situations when Sch H is no longer applicable:
■ When, at the time of signing the agreement, the high rise building is
already completed and the cert of fitness has been issued by local
authority.
■ In that case, the buyer has to sign a sub-sale agreement between him
and the developer. The developer has the right to create his own terms
under the sub-sale agreement.
● S 84 LPA & Msian BC Ruling: Solicitor acting for the developer cannot act for the buyer.
○ You have to make it clear to the purchaser you are acting for the developer.
○ S 84(1) requires solicitor to get certificate signed by the P & it must be attested in
the presence of a commissioner for oaths
■ To ensure the purchaser is well aware that you are acting for the
developer.
○ If the P appoints his own solicitor, the D should send the Schedule H agreements
to the sol for free - reg 11(4) HDR 1989
■ It is very unlikely that the P will engage his own solicitor to act for him in
the schedule H agreement because the D's sol had attended to the P in
the signing of Schedule H agreement and had given stamped copies of
the agreement to the P.
○ Preparing Schedule H Agreement (duty of D’s sol)
■ the D's sol has to fill in the blanks in the recital/Preamble of Schedule H:
● (a) name of the developer and its co. reg. No.
● (b) developer's licence no.
● (c) registered address of the developer
● (d) name of the P, ic no and address
● (e) name and relevant particulars of the RP of the
master/individual title
● (f) tenure of the land (if land is leasehold)
● (g) expiry date of the leasehold land
● (h) particulars of the master title or separate title (if issued)
● (i) area of the master title
● (j) name and registered
● (k) name of the housing project
● (l) the advertising and sale permit number of D
● (m) the unit number of the parcel
● (n) area of the parcel
● (o) the description of the accessory parcel
 ■ Other particulars need to be filled in:
● Clause 3: the purchase price
○ Written in number and full sentences
● Clause 12(3): the compensation price per square metre in the
event the built up area is less than that stated in the SPA
● Third schedule: Schedule payments of the PP
● Fifth schedule: Form of service charge statement (contains list of
items where the D can charge the P)
○ NOTE: Sch G does not have Fifth Sch.

Deed of Mutual Covenants (DMC)

● Apart from Sch H, D’s sol must also prepare DMC
● NOTE: This is different from Sch G, as sol need not prepare DMC for Sch G.
● DMC:
○ DMC consists of a set of regulations governing the use of the building and binds
all the parcels owners and the D
■ To regulate conduct of purchasers as parcels owners
● Prev, the D has the right to set the standard T&C in the DMC but since 2015 it has been
regulated under Schedule 3 of the Strata Management (Maintenance and Management)
Regulations 2015
○ Meaning now, D has to prepare DMC according to the regulation.
● Who signs DMC?
○ The signatory of a DMC include the developer and the purchaser of a unit in the
housing development and/or the management company (if there is a
management company appointed).
● DMC has a binding force over all owners, tenants and users of the building.
● Lifespan of DMC
○ DMC is only valid for a period of not more than 12 months from the date of
delivery of vacant possession to the purchaser.
○ Within these 12 months, the D has to oversee and maintain all the infrastructure
and common facility pending the handover of the management of the
infrastructure to the joint management body (which will be formed in the 12
months).
○ Once a joint management body (JMB) is formed within 12 months from date of
vacant possession, the DMC ceases to apply.
○ The house rules set by the JMB will become the new rules which will bind the
new owners.
● Relevant parties can take legal action against the party who violates the DMC. The
remedies of violations include damages against losses, an injunction order from the
court and a declaration from the court concerning the violating act.

After P has signed Sch H and DMC, the D’s sol has to do the following things:
● Prepare 4 copies of Schedule H & 4 copies of DMC
● Out of 4 copies:
 ○ 1 original & 1 duplicate copy - given to P;
○ 1 copy for the D;
○ 1 copy for the sol's file.
○ *original copy will be kept by the end-Financier
● Issuance of Strata title
○ Strata Titles Act 1985 - upon completion of the building, D has to apply for strata
titles within 6 months of Certificate of Completion & Compliance (CCC) of the
building being issued.
■ Before cert of fitness is issued, within 6 months, the D's would have to
apply for strata title from the land office.
○ When the strata title is issued, the D would ask its sol to inform the P and ask the
P to sign the MOT.
○ At this juncture, a legal fee will have to be paid by the P.
○ At this stage, P has the right to appoint his own sol. So the P may reject the sol
appointed by the D and appoint his own sol.
○ Upon strata title being issued, P’s sol is supposed to:
■ get P's IC
■ prepare MOT to transfer the strata title into the name of the P
■ then execute, adjudicate, register the MOT, title & charge (if the P has
existing loan) at the land office.
■ the duly registered title and charge will be kept by the P's Financier.
● If P is a cash buyer, forward the registered title and charge to P for
his safe-keeping.

Sch H - Salient Provisions

● Front page of Sch H is more or less the same as Sch G.
● Purchase price
○ Clause 3 - Purchaser price must be written in full sentences as well as in
numbers
○ Amount of price P has to pay
● Clause 4: Schedule of payments
○ Sch of payments of pp is not paid in lump sum bcos property is still under
construction. Progress payment is based on Third Sch of Sch H/SPA.
○ NOTE: If P buying property under Sch H/G, payment of pp is not lump sum, it’s
based on progress of the construction of the building (installments).
● Clause 5: Loan
○ Ask P whether buy property with cash or by taking loan
○ Ask: Has the loan been attained or still in application?
○ If P needs help, ask P to contact D because D can help P to get a loan.
○ Ask: Whether P wants to get a government loan or a bank loan?
■ If govt loan refer to Clause 6.
■ Govt loan needs to prepare a lot more docs both on P and D part.
■ If P wants to take govt loan, need to let D know cos D needs to prepare
the docs.
● Clause 9: Interest on late payments
○ Once a stage of the construction progress is completed, the D will prepare an
invoice supported w a cert from the engineer and D will demand payment from
the P (if P hasn’t obtained loan) or F (if P has obtained loan)
○ Even though invoice is given to the F, the P still has the responsibility to monitor
that the payment from F to D is done.
○ If not, D can impose late payment interest on P.
○ Usually the billing must be settled within 21 working days. If there is any late
payment, the interest will be calculated on a daily basis at a rate of 10% per
annum.
○ If P has:
■ Failed to pay the progressive payment in accordance with third schedule
more than 28 days after the due date; or
■ Committed any breach/fail to perform any t&c in the agreement; or
■ Been declared as a bankrupt, before payment of full pp is completed.
○ The D has the right to terminate the agreement, and to sell the unit to other P. If
there has been any payments made by the P before termination, D has to deal
with the payment under clause 10.
○ More or less the same as Sch G.
● Clause 11: Separate strata title and transfer of title
○ Since highrise buildings are usually issued with a master title.
○ It is the duty of the D to apply for subdivision of the building at the relevant land
office to issue the strata titles.
○ Once strata titles have been issued, the D has to inform P to sign MOT. Then,
the name of P can be reg in the strata title.
● Clause 12: Consent to assignment/sub-sale
○ If P already obtains the key to the house but still hasn’t obtained the strata title,
can the P transfer/sell his unit to another P?
○ Yes even though the strata title is still pending issuance from the land office. But
he has to get the consent from D. This is called as consent to assignment.
○ In such case, the D cannot withhold any intended sale, transfer or assignment by
the p to any 3P. V shall endorse consent to the assignment.
○ P must pay RM500 (admin fee) so that V can endorse his consent to the
assignment.
○ If the strata title is already issued to P but name of P is still not reg in the strata
title, need to liase with D.
○ But if the strata title is issued and P’s name is reg, then no need consent from D.
● Clause 13: Position and area of parcel
○ If area of unit is different from area stated in SPA, by virtue of Clause 13, P has
the right to adjust the pp. Adjustment of pp must be based on the amount
calculated in Clause 13(3) which is the amount per square metre which is
determined by D.
● Clause 14: Materials and workmanship to conform to description
● Clause 15: Restriction against variation by P
Payments P has to pay after delivery of vacant possession. Prior of which, D will bear the costs.
● Clause 17: Infrastructure and maintenance
○ Infrastructure includes the roads, driveways, drains, culverts, water mains and
sewerage system serving the said Building
○ It is the resp of D to build and maintain the infrastructure
○ P will have to pay the maintenance fees of the infrastructure upon collecting the
keys to the house.
● Clause 18: Common facilities and services
○ Resp of D to construct common facilities e.g. collection of refuse, the cleaning of
public drains, the cutting of grass, and cleaning of swimming pools (if any).
○ The Vendor shall bear all costs and expenses for the maintenance and
management of the said facilities and services until such date when the
Purchaser takes vacant possession of the said Parcel.
● Clause 19: Payment of service charges
○ P have the duty to pay the service charges to maintain/manage the common
facilities. P will have directly to D prior to establishment of a management
operation.
○ Manner of payment in subclause 2 until 6
● Clause 20: Sinking fund
○ Sinking fund an amount where the P has to pay for the purpose of:
■ the painting or repainting of any part of the common property;
■ the acquisition of any movable property for use in relation with the
common property; or
■ the renewal or replacement of any fixture or fitting comprised in the
common property.
● e.g. playground - the JMB/D will lose this fund to fix the
playground.
○ How much the P has to pay with regard to the sinking fund.
■ Usually D will charge at the rate of 10% of service charge. e.g.
Maintenance fees RM150 monthly - so sinking fund is RM15.
■ Usually the sinking fund is joined together with the maintenance fees.
○ The P will have to pay the sinking fund at the time of the delivery of vacant
possession.
● Clause 21: Insurance
○ In the event of any damage to the P’s unit, P has to pay the insurance to the D.
○ Purpose of paying insurance: To ensure unit of P is protected against loss or
damage by fire and against all such other risks as the Vendor may think fit.
● Clause 22: payment of outgoings
○ outgoings including quit rent, rates, taxes, assessment and other charges in
respect of the said Parcel/
○ P has to pay directly to D after getting delivery of vacant possession.

Payment P has to pay even before delivery of vacant possession

● Clause 23: water, electricity, gas piping, telephone trunking
○ V can demand for these payments because V has to pay to relevant authorities.
 ○ E.g. for water connection, V needs to pay to Syabas.

● Clause 26: time for delivery of vacant possession

○ How it differs from Sch G
■ For Sch G, within 2 years the D has to deliver vacant possession to P.
■ For Sch H, the timeline for D to complete construction of the building is 3
years from the date of the SPA/Sch H.
○ If D has not delivered vacant possession in time, P has the right to get liquidated
damages from the D. Compensation will be calculated on a daily basis.
○ The rate of compensation - refer to Clause 26.
● Clause 30: defect liability period
○ If there is any defect on the property, the P has the right to claim and have it fixed
from the D within 18 months from the date the P takes vacant possession of the
parcel.
○ Usually P will list down the defects he has encountered.