BADAN PENGURUSAN BERSAMA BOTANIKA v BAYOU BAY DEVELOPMENT SDN BHD
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Judges (1)
Case Significance
Confirms that a joint management body, whose functions under the Strata Management Act 2013 concern the common property, lacks locus standi to sue a developer on the individual purchasers' sale and purchase agreements, such claims being personal to the purchasers under the doctrine of privity.
This High Court decision at Johor Bahru concerns a developer's application to strike out a claim brought against it by a joint management body, made under Order 18 rule 19(1)(a), (b) and (d) of the Rules of Court 2012. The plaintiff, the joint management body of a strata development, had sued the defendant developer over alleged misrepresentations and breaches connected with the sale of units in the development. The central question was whether the joint management body had the locus standi to bring such a claim. Reviewing the scope of a joint management body's powers and functions under section 143(2) of the Strata Management Act 2013 — which are concerned with the management and maintenance of the common property — and following authorities such as Dua Residency Management Corporation v Edisi Utama Sdn Bhd and Dr Looi Mun Choon v Paragon Promenade Sdn Bhd, the Court held that although a joint management body has legal personality, it has no substantive right in the sale and purchase agreements made between the developer and the individual purchasers. By the doctrine of privity of contract, only the parties to a contract may sue or be sued on it, and the sale and purchase agreements here were between the developer and the individual buyers, not the joint management body, which comes into existence only after a meeting of the proprietors following completion of the development. Any misrepresentation or deceit alleged to have been practised on individual purchasers before the joint management body was formed was therefore an injury to the purchasers personally, not an injury to the body corporate, and was not the joint management body's to sue upon. The Court further agreed that promotional statements in the development's brochures and website were mere puff or an invitation to treat, carrying no contractual force. Concluding that the plaintiff lacked locus standi to claim relief founded on misrepresentation and breach of the individual sale and purchase agreements, the Court struck out the claim.
Did the joint management body have standing to sue the developer over the sale of units?
No. The Court held that although a joint management body has legal personality under the Strata Management Act 2013, it has no substantive right in the sale and purchase agreements between the developer and individual purchasers. By the doctrine of privity, only the parties to those contracts may sue on them, so the claim was struck out for want of locus standi.
Whose injury were the alleged misrepresentations to the purchasers?
The Court held that any misrepresentation or deceit practised on individual purchasers before the joint management body was formed was an injury to the purchasers personally, not an injury to the body corporate. It also treated promotional statements in brochures and on the website as mere puff or an invitation to treat, carrying no contractual force.
Cases Cited (1)
Judgment
Read the full judgment on the official Malaysia Courts portal.
Read on eJudgmentSource: eJudgment (ja-22c-1-02-2025)