The Housing Tribunal Blunder: another
great disservice of the Minister of Housing and Local Government
Speech
- at the DAP forum "The great housing TRIBUNAL blunder"
by Ronnie Liu Tian Khiew
(Kuala Lumpur, Tuesday):
The portfolio of Minister of
Housing and Local Government was traditional held by MCA leaders for the
past few decades. It has been held by MCA leaders such as Michael Chen, Neo
Yee Pan, Ng Choon Kiat, Lee Kim Sai, Ting Chew Peh and now Ong Ka Ting.
Nothing could be said very much
about their contributions as the minister for housing. All these years,
homebuyers in the country have been subjected to all kind of injustices and
problems, and they usually get very little or no help from these ministers.
The recent great blunder is
just another disservice committed by MCA housing minister. Datuk Seri Ong Ka
Ting could have avoided the huge embarrassment if he has listened carefully
to DAP MPs like Chong Eng and Teresa Kok. Both have pointed out to him in
the Parliament that the legislation for the Tribunal has no provision for
retrospective effect.
It is hard for us to believe
that the minister and the law officers with the ministry and the Attorney
General's chamber could have made such a glaring mistake. It is equally hard
to believe that the minister could drag his feet for so long on this matter.
If he has made a mistake in
drafting the regulations for the Tribunal, he should be bold enough to admit
it and apologise to all homebuyers and all Members of Parliament. If he
believe that he has done no wrong, he should immediately take the necessary
steps to resolve the matter.
A friend of mine, who's a
lawyer, has pointed out to me that there are two matters in Section 16 of
the Act: that of a civil claim/ liability and that of a criminal liability.
He said while the criminal aspect is clearly not the purview of the
Tribunal, the civil aspect is simply a restatement of the existing
rights/liabilities and therefore is retroactive/ retrospective in nature.
He argues that the Chief
Justice can and has the authority to call up the matter as soon as possible
for review, since the matter is of such public import.
He also argues that the
minister and the AG have the rights to get the lawyers to bring this up in
court immediately, instead of dragging their feet.
In fact, Ong as the housing
minister, in the first place, should have directed his lawyers to hold
watching brief to assist the court, since the legislation drawn up by his
ministry and subsequently passed in the Parliament was challenged in court.
Coming back to the problems and
hardship of the homebuyers thanks to the MCA housing ministers all these
years.
Before the coming into force of
the regulations pertaining to the Tribunal, there existed rights of the
Homebuyer to sue the Developer for breaches in accordance with the Housing
Development {Control & Licensing} Act 1966.
For these rights to be
enforced, especially for late delivery claims, these claims used to be filed
into the Magistrate Courts or Sessions Courts, which are under the
jurisdiction of The High Court of Malaya.
The Tribunal was set up in
2002, simply to speed up the claim process and to make it easier and cheaper
for the homebuyers. Which is why under Section 16U of the Act, advocates and
solicitors are not allowed to attend the hearings of the Tribunal, unless
in the opinion of the Tribunal, there are complex issues of law.
The S&P Agreement that is
supposed to follow the standard in the Act, more often than not, seems to be
abused. Here are just some of the problems frequently encountered:
a. Claims by Developer
for maintenance etc. Even before the CF is issued, the Developer claims for
maintenance charges.
b. The "management
company". The property and all of the areas belong to the homebuyers. The
Management Company is simply the "trustee" of the owners. They cannot be
charging the homebuyers all kind of fees and maintenance costs.
c. The certificate of
fitness. There has been a whole series of "Temporary CF", where the
Developer uses this to claim against the homebuyers, especially if the
developer is late. These Temporary CFs only valid for 6 months. What is
going to happen if things are still not ready after the 6 months?
The "SQUEEZE"
a. When a Homebuyer buys
the home, he/she usually takes a loan from the Bank.
b. More often than not,
there is no individual title at that time.
c. And nearly always,
the bank is always the provider of financing for the Developer.
d. So, the Homebuyer
signs a loan document, which is called a Deed of Assignment containing a
power of attorney, where the Homebuyer assigns all his /her rights to the
Bank.
e. The Bank then deals
directly with the Developer.
f. As the Developer
completes each and every stage, it demands from the Bank, payment.
g. As the payment is
given to the Developer, the Bank charges interest (to the Homebuyer) on the
amount disbursed to the Developer.
h. When the Developer
issues the Certificate of Practical Completion, the Bank starts to demand
repayment, even when there is no Certificate of Fitness, CF.
i. The Developer also
demands for "outstanding and overdue" maintenance charges.
So, the Homebuyer, when he or
she is forced to collect the keys is faced with two hurdles:
1. Amount "due' to the
Developer.
2. Amount "due" to the
Bank.
But there is no CF, nor is
there the Title!
How about the concept of the
Deed of Assignment/ Power of Attorney?
This document is the most
effective mode of bypassing the strict rules for strata tiles etc. It is
also the most effective mode in favour of the Developer who applies for a
small financing but the homebuyers are made to pay up-front.
It is not in favour of the
Homebuyers simply because the ministry does not enforce the law properly and
effectively.
In the past, many homebuyers
and consumers have urged the ministry to adopt the "build first and sell
later" policy to protect the rights of homebuyers. We have never heard Ong
Ka Ting utter a word on this policy ever since he becomes the housing
minister. This minister, as usual, hides behind his motto- silence are
golden.
(23/9/2003)
* Ronnie Liu Tian
Khiew, DAP national publicity secretary and DAP Selangor chairman
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