Court of Appeal rules Minister may grant extension of time to complete housing development

30 March 2022

Bludream City Development Sdn Bhd v Kong Thye & Ors and other appeals [2022] 2 CLJ 829

In Bludream City Development Sdn Bhd v Kong Thye & Ors and other appeals, the respondents (“Purchasers”) were purchasers of units of serviced apartments developed by Bludream City Development Sdn Bhd (“Developer”). After being granted a six-month extension from the Controller of Housing (“Controller”), the Developer made a second application to extend the 42-month time period to 59 months as, throughout the 17-month stop work order (“SWO”) period, no work could be done. As the Controller only allowed the Developer’s second application in part, the Developer made an appeal to the Minister of Urban Wellbeing, Housing and Local Government (“Minister”). The Minister agreed to amend Schedule H to the Housing Development (Control and Licensing) Regulations 1989 (“Regulations”) to extend the time period to complete the units and granted an extension of time of 17 months (“Minister’s decision”).

At the High Court, the Purchasers commenced a judicial review application challenging the Minister’s decision. The High Court allowed the application based on its understanding of the binding effect of the Federal Court’s case of Ang Ming Lee & Ors v Menteri Kesejahteraan Bandar, Perumahan Dan Kerajaan Tempatan & Anor and other appeals (“Ang Ming Lee”) that regulation 11(3) of the Regulations was ultra vires the Housing Development (Control and Licensing) Act 1966 (“Act”). The Developer, the Minister and the Controller appealed.

In allowing the appeals, the Court of Appeal held as follows:

  • In the present case, unlike in Ang Ming Lee, it was the Minister that made the decision to extend the time. The fact that the Controller had no power to make a decision under regulation 11(3) of the Regulations did not take away the power of the Minister to make a decision under regulations 11(3) or 12 of the Regulations. The power of the Minister must necessarily include the power to modify the Schedule H contract.
  • The Minister is empowered under section 24(2)(e) of the Act to “regulate and prohibit the conditions and terms of any contract” between the developer and the purchaser. The expression “regulate and prohibit” is wide enough to include “waive and modify” any provisions under regulation 11(3) and the Minister’s decision to amend Schedule H to the Regulations was therefore rational, reasonable and not illegal, and certainly not infected by Wednesbury irrationality (a reasoning or decision is Wednesbury unreasonable (or irrational) if it is so unreasonable that no reasonable person acting reasonably could have made it per the English Court of Appeal decision in Associated Provincial Picture Houses Ltd v Wednesbury Corporation
    (1948) 1 KB 223).
  • In the present case, there was a genuine need for the extension of time corresponding to the period of delay caused by the SWO which was not through any fault of the Developer.