British couple who lost their home suing developer too, says lawyer
V Anbalagan
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December 29, 2018 8:54 AM
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PETALING JAYA: A British couple who lost their home, which was under construction, as a result of mishandling by a bank, have filed a suit against a developer for refund of money due to them, their lawyer said.
Counsel Ong Yu Jian said the High Court was scheduled to hear the suit next year since the couple’s action against CIMB Bank Bhd had been finally determined by the Federal Court.
“We are seeking a refund from the developer for whatever is due under the sale and purchase agreement (SPA),” he told FMT.
Ong, however, said the developer was entitled to forfeit the 10 % deposit of the purchase price paid under the SPA.
Last week, the Federal Court ruled in favour of Anthony Lawrence Bourke and his wife Alison Deborah Essex Bourke as CIMB was attempting to rely on an exemption clause in a housing loan agreement to evade a civil suit.
The couple, who are living in the United Kingdom, had asked the bank for special damages amounting to RM273,996.24, being the total amount of loan payments that they paid to CIMB under the facility.
They had also asked for RM747,481.42 being the total losses suffered due to the termination of the SPA and RM10,975.30 being all other miscellaneous costs and expenses incurred due to the bank’s breach.
They have also asked for general, aggravated and exemplary damages to be assessed by a High Court judge.
The couple filed the suit in 2015 but the High Court dismissed the action on grounds that CIMB was shielded from any liability due to an exemption clause in the loan agreement.
Two years ago, the Court of Appeal reversed that decision and last week the Federal Court, in a landmark ruling, affirmed the finding – a small win for bank customers.
Ong said the couple wanted to buy a property as they were participants of the “Malaysia My Second Home programme” where the government allows foreigners to live in the country on a long-stay visa of up to 10 years.
The bank, in 2008, granted them a term loan facility of RM715,000 to purchase the property in Kuala Lumpur from a developer.
The property in Jalan Sultan Ismail was still under construction and payment was to be made progressively by the bank based on the certificate of completion issued by the architect to the developer.
In early 2014, the developer sent an invoice seeking a progress payment of RM25,557.12 but CIMB did not release the money as it needed to conduct site visit inspections on the property.
A year later, the developer terminated the SPA with the couple as the bank had not paid the money.
The couple filed a claim against the bank for breach of contract, negligence and breach of fiduciary duty, seeking for damages suffered resulting from the termination of the SPA.
The three-member Federal Court said the exemption clause in the agreement was against public policy as Section 29 of the Contracts Act 1950 prohibited the right to sue.
Justice Balia Yusof Wahi, who delivered the ruling, said the agreement was patent unfairness and injustice to the plaintiffs.
He said the right of access to the courts had always been jealously guarded by the common law and the general principle remained that contracts which sought to oust the jurisdiction of the courts were invalid
