Justice Wong Kian Kheong said Baiduri Heights Development Sdn Bhd, developer of CHOGM Villa, was not the rightful owner of these facilities under the Strata Titles Act 1985 (STA) and approvals granted by the Langkawi municipal council.
Delivering the court’s broad grounds of judgment, Wong explained that Section 4 of the STA defines “common property” as any land or space in a building or development area reflected in an approved strata plan.
“The High Court judge did not err in law or in fact by deciding that the swimming pool and clubhouse constituted ‘common property’ of the development area,” he said.
In a unanimous decision, the appeals court affirmed the High Court’s ruling which allowed the management corporation’s counterclaim.
In its counterclaim, the management corporation had sued 11 parties, including the developer, its property management subsidiary, the Langkawi land administrator, the Kedah land and mines director, and the state government.
Wong noted that the approved layout plan designated the swimming pool and clubhouse, among other amenities, as part of the development’s “facilities”.
The panel, which included Justices Azimah Omar and Ismail Brahim, also rejected the developer’s appeal from the dismissal of the main suit brought against the management corporation, the land administrator, the land and mines director, and the state government.
Wong said the management corporation had legal standing to bring the counterclaim and was not time-barred under either the STA, the Limitation Act 1953 or Section 2(a) of the Public Authorities Protection Act 1948.
He said the case involved a “continuance of injury or damage” suffered by the management corporation arising from the acts and omissions of the land administrator and the land and mines director as regards the swimming pool and clubhouse.
Wong also said the High Court judge was correct in finding that the land administrator and the lands and mines director were liable for misfeasance in public office in issuing two additional strata titles for the two spaces.
“Consequently, the Kedah state government was vicariously liable to the management corporation for this tort committed by the land administrator, and the lands and mines director,” he said.
Wong said the High Court was also correct in holding that the developer and the property management company had committed the tort of conversion, fraud, breach of trust and unjust enrichment.
The bench also ordered the developer and three individuals to pay RM85,000 in costs to the management corporation.
CHOGM Villa — a development built on a plot of land known as Lot 421 and consisting of 208 townhouses, the clubhouse and a swimming pool — obtained its certificate of fitness in 1998.
The developer had collected RM9,000 per month from the maintenance fees for the rental of the clubhouse and swimming pool.
At its first annual general meeting held on Nov 24, 2013, the management corporation discovered that the clubhouse and swimming pool were being claimed by the developer as their private property.
The management corporation also discovered that the developer had in total collected RM1.6 million as rental for use of the clubhouse and swimming pool.
It also discovered that 210 strata titles were issued by the Langkawi district land office although the development consisted of only 208 townhouse units.
Lot 421 was registered in the name of the management corporation. The land office was of the view that the clubhouse and swimming pool formed part of the common property and could not be held by the developer in its own name.
In 2014, the developer filed a suit seeking to have title to the clubhouse and swimming pool transferred to its own name.
In response, the management corporation filed its counterclaim, claiming that the club house and swimming pool were common property and that only 208 townhouses had been approved based on the planning permission, building plan and certificate of fitness.
The High Court ruled in the management corporation’s favour, giving rise to the present appeal.
Lawyers Karin Lim, M Murgan and Clifford Ong appeared for the management corporation, while Lily Chua and Farah Farhana Effendy Onn represented the developer.
Nor Hayati Ibrahim acted for the land administrator and the state government, and Rozman Azwan Osman acted for Majlis Perbandaran Langkawi.