NG POH HWA v 1. ) HIJAUAN KIARA MANAGEMENT CORPORATION 2. ) BUKIT KIARA PROPERTIES SDN BHD

Case Significance

Illustrates how privity, coupled with a failure to plead estoppel, defeats a specific-performance claim built on a third party's oral agreement: a purchaser could not compel a developer, a stranger to the alleged agreement with the management body, to amend the strata plan and title.

This decision of the High Court of Malaya at Kuala Lumpur concerns applications by two defendants to strike out the plaintiff's writ and statement of claim under Order 18 Rule 19(1) of the Rules of Court 2012. The plaintiff had sued the first defendant, a management corporation, and the second defendant, a developer, in relation to a car-park bay: he claimed to be entitled to a particular bay (P3-26) as an alternative to another bay (P3-27), and sought, in the alternative, specific performance requiring the developer to amend the strata plan and to hand over the strata title to his property with the disputed bay recorded as an accessory parcel. His case rested on an alleged oral agreement with the joint management body. Both defendants applied to strike the claim out, and the court allowed both applications.

The court's reasoning turned on the pleadings and the doctrine of privity. The developer had pleaded that it was not privy to the alleged oral agreement between the joint management body and the plaintiff, and the relief the plaintiff sought against the developer therefore depended on his being able to bind the developer to that agreement notwithstanding the absence of privity. To do so, the plaintiff would have had to plead the material facts giving rise to an estoppel in his Reply to Defence; on examination, he had not pleaded estoppel at all. Without a pleaded basis for fixing the developer with an obligation under an agreement to which it was a stranger, the claim disclosed no reasonable cause of action against it and could not be sustained. Finding the claim liable to be struck out on the grounds advanced, the court allowed both defendants' applications and struck out the writ and statement of claim, leaving the plaintiff to pursue his right of appeal. The judgment illustrates how privity, coupled with a failure to plead estoppel, defeats a specific-performance claim built on a third party's oral agreement.