Sime Darby Property Berhad & Anor v Ooi Cheng Huat & Ors

Appellant(s): Sime Darby Property (Bukit Jelutong) Sdn Bhd

Respondent(s): Shaiful Hamidi Bin Basirdin

• YAA Datuk Seri Utama Wan Ahmad Farid Bin Wan Salleh
• YAA Datuk Hajah Azizah binti Haji Nawawi
• YA Datuk Azimah binti Omar

• The appeals arose from six consolidated civil suits filed by the purchasers of luxury bungalows against a developer for breaches of Sale and Purchase Agreements (SPAs) relating to numerous patent and latent defects.
• Four bungalow units were purchased under "Sell-then-Build" (STB) terms governed by Schedule G of the Housing Development (Control and Licensing) Regulations 1989, while two units were sold under "Build-then-Sell" (BTS) terms.
• The developer contended that the BTS units were sold on an "as is where is" basis, that all reported defects had been rectified as evidenced by signed forms (which the purchasers alleged were forged), and that many claims were barred as they were made outside the 24-month Defect Liability Period (DLP).

• Whether a developer can legally "contract out" of the statutory protections and warranties of good workmanship provided in Schedule I of the Housing Development (Control and Licensing) Act 1966 (HDA) by using "as is where is" clauses in BTS contracts.
• Whether the statutory 24-month DLP serves as a limitation period that bars a purchaser's right to claim damages for latent defects discovered after the expiry of the said period.
• Whether the Court may apply the "business common sense" rule of contractual interpretation to impose specific quality and capacity obligations on a developer when the descriptions in the statutory SPA schedules are intentionally broad or vague.

• The Court dismissed the appeals, affirming that the HDA is social legislation intended to protect home buyers; consequently, any "contracting out" of statutory forms is void unless the substituted terms are more favourable to the purchaser than the statutory minimum.
• The Court held that the statutory DLP applies exclusively to patent defects discoverable upon reasonable inspection, and it does not extinguish a purchaser’s right to sue for breach of contract regarding latent defects caused by poor workmanship or materials.
• The Court ruled that the developer remained bound by the obligation of good workmanship to provide systems (such as air-conditioning) suitable for the luxury nature and price of the properties, holding that a rigid, literal interpretation of vague specifications that leads to absurdity must yield to business common sense.