Icon City Development Sdn. Bhd. (DAHULU DIKENALI SEBAGAI SIERRA PENINSULAR DEVELOPMENT SDN BHD) v Ros Azlin Bin Sabawi

Case Significance

Confirms that the computation of the LAD period for late delivery of vacant possession under a standard sale and purchase agreement is governed by binding Court of Appeal authority, and a first-appellate court applies that settled interpretation under stare decisis rather than revisiting it.

This High Court decision at Shah Alam is an appeal concerning liquidated ascertained damages (LAD) for the late delivery of vacant possession of a property, and it turns on contractual interpretation constrained by binding appellate authority. The respondent purchaser had succeeded before the Magistrate, after a full trial, in a claim against the appellant developer for LAD for late delivery of vacant possession, with costs of RM5,000. The developer appealed to the High Court. The dispute centred on the interpretation of clause 35A and section 10 of Schedule A of the sale and purchase agreement — in particular, the point from which the 42-month period for computing LAD begins to run — and on the deeming provision by which a purchaser is treated as having taken delivery of vacant possession on the expiry of the relevant period after a vacant-possession notice.

The court held that it was bound by the Court of Appeal's decisions on the current position of the law in dispute. Applying the doctrine of stare decisis, it declined to depart from the settled interpretation of the LAD provisions that the appellate court had already laid down in similar cases. On the facts, it accepted that under the deeming provision (clause 13.2.2 of the agreement) the purchaser was deemed to have taken delivery of vacant possession on the expiry of the fourteen-day period from the date stated in the vacant-possession notice, and it found that the Magistrate had not misdirected herself and had sufficiently evaluated the evidence.

The court upheld and affirmed the Magistrate's decision and dismissed the appeal with costs of RM5,000 to the respondent, subject to allocator. The judgment illustrates that the computation of the LAD period under a standard sale and purchase agreement is governed by binding Court of Appeal authority, and a first-appellate court will apply that settled interpretation rather than revisit it.