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DALAM MAHKAMAH RAYUAN MALAYSIA

(BIDANG KUASA RAYUAN)


RAYUAN SIVIL NO: B-02-(NCVC)(W)-186-01/2013

ANTARA

ANGELANE ENG
... PERAYU
DAN

BANDAR ECO-SETIA SDN BHD


... RESPONDEN

[Dalam Perkara Guaman Sivil No. 22-NCvC-428-2011


dalam Mahkamah Tinggi Malaya di Shah Alam

Antara
Bandar Eco-Setia Sdn Bhd
... Plaintiff
Dan
Angelane Eng
... Defendan]

CORAM:

ZAHARAH BINTI IBRAHIM, JCA


ANANTHAM KASINATHER, JCA
MAH WENG KWAI, JCA

1
ANANTHAM KASINATHER, JCA
DELIVERING JUDGMENT OF THE COURT

BACKGROUND FACTS

1. The appellant purchased a vacant bungalow lot in the project


located in Phase 1B of Precinct 3 in the Mukim of Bukit Raja,
Selangor Darul Ehsan from the respondent. The purchase was
to facilitate the construction of a bungalow house on the vacant
lot. The vacant lot is located within a gated and guarded
housing project managed by the respondent. To this effect, the
parties executed 2 agreements of the same date:-

a) A Sale and Purchase Agreement dated 17th


December 2004; and

b) A deed of Mutual Covenants dated 17th December


2004 (DMC).

2. The DMC contains terms and conditions and various


covenants, the purpose of which is to:-

a) Promote communal lifestyle, enjoyment and


beneficial occupation by all homeowners;

2
b) Promote harmonious use and enjoyment of facilities
and services;

c) Specify rules and regulations for purchasers to


comply and follow; and

d) Regulate the relationship between the respondent


developer and the purchasers, as well as to
regulate the relationship between the appellant and
other purchasers of vacant lots in the housing
project.

3. The provisions in the DMC relevant to this appeal are the rules
and regulations set out in the Design, Building and Construction
Guidelines (Building Guidelines) appended as Schedule 5 to
the DMC. The Building Guidelines required the appellant inter
alia to construct the bungalow house on her vacant lot to a
particular height. The height of the house from the top of the
roof to the original ground level was not to exceed 12 meters.
To ensure compliance with the DMC, purchasers of vacant lots
were required to submit building plans to the respondent prior
the commencement of the construction of the proposed
bungalow on the vacant lot. The further requirement being that
the subsequent construction must be in accordance with the
approved plans.

3
4. Section 9 of the DMC permitted the appellant to exceed the
aforesaid height limit of 12 meters inter alia in respect of
buildings in Precinct 3 upon obtaining the consent of a Review
Panel established by the respondent pursuant to the DMC. The
Review Panel was authorized to grant a relaxation of the
building height on a case by case basis.

5. In accordance with this requirement, the appellant did submit


building plans for the construction of the bungalow lot on its
vacant lot. The respondents Review Panel granted a relaxation
of the height by allowing the roof to be built to a height of
12.192 meters. The matter of controversy in this appeal arises
from the fact that the ultimate height exceeded even the
approved limit of 12.192 meters.

6. It appears that the original approved plans provided for the


construction of a flat roof. However, during the course of
construction, the appellant ascertained that such a roof was
incompatible with the feng shui for the building. Hence the need
to change the roof to a pitched roof from the original flat roof.
This caused the appellant to stop work on the house during the
construction stage, redesign the roof beyond the height limit
prescribed in the Building Guidelines and thereafter complete
the construction of the bungalow lot in December 2009.

7. It is not in dispute that the appellant is not alone in having


constructed a bungalow exceeding the height limit approved by

4
the respondent. The evidence revealed that some 40 houses
out of the total number of 66 completed houses in Precinct 3
have exceeded the height limit of 12 meters, with the
respondent only having commenced legal action against some
10 of the owners. The appellant produced the survey plan and
photographs of these houses to substantiate this claim.

8. The purchasers of the remaining houses who had constructed


their houses within the height limit prescribed by the respondent
complained vide a letter dated 18th March 2009 concerning the
breach of the terms of the DMC by the aforesaid 40 purchasers.
The complaints from the other purchasers and the fact that the
majority of the bungalows had exceeded 12 meters caused the
respondent to convene a meeting sometime in June 2009. This
is evident from the respondents letter of 24th June 2009 and the
appellants letter of appeal of 14th September 2009.
Notwithstanding that the appellants bungalow lot was still
under construction at this point of time, the respondent took no
steps to stop the construction of the appellants bungalow lot.
Indeed, apart from allowing the construction to proceed, the
respondent provided the appellant with a 5 percent early
completion rebate on 30th September 2009 and allowed the
appellant to move into its completed bungalow on 20th
December 2009. The appellants entry into the bungalow being
authorised by the respondent executing an owner occupancy
registration form dated 12th December 2009 and in which form

5
the respondent authorised the appellant to move in by 20th
December 2009.

9. According to the appellant, the first time the respondent


expressed any objection to the construction of her bungalow
exceeding the height limit, after the initial objection raised at the
meeting at 12th June 2009, was when she received a stop work
order on 31st December 2009. Thereafter the respondent took a
further one year and four months before filing the writ forming
the subject matter of this claim on 12th April 2011.

JUDGMENT OF THE HIGH COURT

10. The breach on the part of the appellant was first brought to the
attention of the respondent by other purchasers in March 2009
(see page 459 of Jilid 2 (2). The Learned Trial Judge
acknowledged that by June 2009, the main frame and other
structural works including the super structure of the building
had been constructed and was close to completion. The
respondent upon being so alerted, caused its staff to conduct a
site inspection to investigate the nature and extent of the
breach. Following such inspection, according to the Learned
Trial Judge, the appellant was adviced that the construction of
the house was not in accordance with the approved plans
during a meeting between the parties on 12th June 2009.

6
11. The Learned Trial Judge observed that the respondent after the
receipt of the appellants letter of appeal of 14th September
2009 containing its explanation for this breach, proceeded to
order the appellant to suspend all construction work vide its
letter of 31st December 2009. The Learned Trial Judge then
proceeded to make the following finding of fact:

Despite the issuance of the stop work notice, the


defendant continued with the construction on the lot
and completed her house beyond the height limit
permitted by the Plaintiff.
(see page 4 of the judgment of the Court)

12. Relying on the above finding of fact, the Learned Trial Judge
proceeded to reject the defences of equitable estoppel and
acquiescence and instead ruled:

It is clear that except in the circumstances of fraud,


misrepresentation, coercion or undue influence
which can vitiate a contract, the Court is duty bound
to enforce a contractual provision (in this case the
height requirement for a bungalow in Phase 1
Precinct 3 as stipulated in Appendix 2.1 of the 5th
Schedule of the DMC) which has been validly
entered into on the own free will and consent of

7
both contracting parties, regardless of its harshness
or unreasonableness.

13. The legal principle governing Her Ladyships aforesaid


conclusion appears to be the pronouncements of Justice Ze Li
to the following effect:

Furthermore, disregarding the inherent powers of


an owners incorporated enforcing the DMC with
omnicompetent statutory authority, I am inclined to
think that the applicant as the estate manager
operating solely under a DMC is a trustee, not an
agent, of the interests of all the owners in the
estate. As such, the applicant cannot waive or lay to
waste the rights of all the owners in the estate that
are enshrined in the DMC. In fact, all the English
authorities so often relied upon as applying the
equitable defence of acquiescence seem to involve
disputes between parties who are principals of their
respective rights. I have not yet been able to
discover any reported English authority which
considers the position acquiescence by a collection
of principals against their individual private rights
through proxy or agency. Even if the applicant is to
be treated as agent, in the absence of clear
evidence to the contrary, it would be perverse to
hold that all the owners of the estate would
8
authorise the agent to suffer breaches of their rights
enshrined in the DMC.

in the case of Taikoo Shing (Management) Ltd v. Trillon (HK) Ltd


[1997] 4 HKC 304.

14. Accordingly, the Learned Trial Judge inter alia granted specific
performance of the Building Guidelines by requiring the
construction of the building on the appellants lot to be limited to
the maximum approved height of 12.192 meters and,
additionally, granted a mandatory injunction requiring the
appellant to demolish so much of the building that exceeded the
maximum approved limit of 12.192 meters within three months
of the order of Court.

APPELLANTS CASE

15. Before us learned counsel for the appellant submitted that the
judgment of the Learned Trial Judge was flawed because Her
Ladyship made an error on a fact critical to the application of
the equitable doctrine of estoppel and acquiesce. According to
counsel, it is not true that the completion of the roof to the
offending height was subsequent to the issue of the stop notice
on 31st December 2009. It was also the submission of counsel
that proceeding from this false premise, Her Ladyship assumed
that the appellant had completed the roof in complete disregard

9
of the stop work notice, thereby causing Her Ladyship to
exercise her discretion in terms of the order for specific
performance sought by the respondent.

16. With reference to the document bearing the caption (owner


occupancy registration form) dated 12th December 2009,
learned counsel for the appellant highlighted the fact that the
building was completed by the appellant on or before 12th
December 2009 as evidenced by the contents of this document.
Indeed, with reference to the words move in by 20/12/2009
learned counsel claimed that it was an unchallenged fact that
the appellant had moved into the house by 20th December 2009
whereas the stop work notice was only served on the appellant
on 31st December 2009. Counsel also made reference to
photographs incorporating the date when the photographs were
taken to substantiate his submission that the offending roof was
in an advanced stage of construction in June 2009. This also
explains why the appellant was called for a meeting in June
2009, followed by a letter dated 24th June 2009 from the
respondent requiring the appellant to demolish the offending
roof, a fact noted by the Learned Trial Judge at page 4 of Her
Ladyships judgment.

17. It is the submission of learned counsel for the appellant, that


the Learned Trial Judge erred in assuming that the stop work
notice of 31st December 2009 followed the failure of the
appellant to act by demolishing the roof following the letter of

10
24th June 2009. In fact, following the letter of 24th June 2009,
the appellant had lodged a notice of appeal on 14th September
2009 with the Review Panel and submitted a revised plan
incorporating the pitched roof to the offending height approved
by the MBSA. Learned counsel for the appellant submitted that
due to this error on the part of the Learned Trial Judge, Her
Ladyship failed to adequately address the equitable defences of
estoppel, acquiescence and laches relied upon by the
appellant. Neither did the Learned Trial Judge take into account
the fact that the primary remedy pursued by the respondent in
the form of a declaration and specific performance were
equitable in nature and consequently attracted the equitable
defences relied upon by the appellant.

18. As regards the Learned Trial Judges reliance on the Hong


Kong case of The Incorporated Owners of Hoi Luen Industrial
Centre & Anor Ohashi Chemical Industries (Hong Kong ) Ltd
[1952] 2 HKC 11, learned counsel for the appellant submitted
that Her Ladyship ought to have followed the principles of law
enunciated by the Hong Kong Court of Appeal in the case of
Cheung Yuat & Another v The Incorporated Owners of Oriental
Gardens [1979] HKLR 536. It was also the submission of learned
counsel for the appellant that the two cases relied upon by Her
Ladyship can be distinguished because in both cases, the
Court was of the view that the equitable doctrine of estoppel
and acquiescence were not relevant because under the
Building Management Ordinance Cap 344, the incorporated
11
owners were under a statutory duty to enforce the mutual deed
of covenants thereby precluding the purchasers from relying on
equitable defences. In the absence of any such equivalent
legislation in this country, learned counsel contended that the
appellants property having a separate title, the mutual deed of
covenants is enforceable only as a contract thereby rendering
the equitable defences of estoppel and acquiescence to be
available to the appellant.

RESPONDENTS CASE

19. Learned counsel for the respondent submitted that once the
appellant acknowledged that it was bound by the terms of the
mutual deed of covenants, then, it must follow that she was
under an obligation to comply with the terms of the same. In
this respect, according to counsel, the appellant had signed the
declaration agreeing to be bound by the terms and conditions of
the mutual deed of covenants. Learned counsel for the
respondent submitted that since the appellant does not dispute
being bound by the terms of the DMC and also admits to not
having complied with the terms of DMC, the Learned Trial
Judge was right in law to order the relief sought by the
respondent under the Specific Relief Act 1950.

20. As regards the relief ordered by the Learned Trial Judge,


learned counsel for the respondent submitted that since the
12
project was being developed as a gated community concept,
the Learned Trial Judge was right in adopting the position that
strict enforcement of the terms of DMC is vital, as otherwise the
floodgates would be open to other purchasers to come out with
private excuses for not complying with the covenants in the
DMC. Finally, learned counsel for the respondent submitted
that the fact that other purchasers may have also undertaken
construction in breach of the height limit does not afford a
defence to the appellant.

JUDGMENT OF THE COURT

21. The evidence is overwhelming that the offending roof was in an


advanced stage of construction in June 2009 and completed, at
the latest by 12th December 2009. First, there is the
respondents Owner Occupancy Registration Form indicating
that the building was completed on 12th December 2009.
Second, there is the respondents agreement authorizing the
appellant to take possession on 20th December 2009. Thirdly,
the appellants claim to being in possession after 20th
December 2009 was not challenged during trial. Fourthly, there
are pictures bearing dates which indicate that the roof was in an
advanced stage of construction in June 2009. Fifthly, the fact
that the respondent was required to demolish the offending roof
vide the respondents letter of 24th June 2009, illustrates that
the roof must have been in an advanced stage of construction
13
even as of that date. As against this, it is an undisputed fact
and the finding of the Learned Trial Judge that the notice to
stop work was only served on the appellant on 30th December
2009. In the face of this evidence, with respect, we agree with
the learned counsel for the appellant that the Learned Trial
Judge erred in Her Ladyships finding that the appellant
proceeded to complete the construction of the roof after the
service upon her of the stop work notice on 30th December
2009.

22. This error on the part of the Learned Trial Judge is critical
bearing in mind that the equitable defences of estoppel,
acquiescence and laches are primarily based on the conduct of
the parties. For instance, estoppel is widely understood to
operate in equity;

If one party by his conduct, leads another to


believe that the strict rights arising under the
contract will not be insisted upon, intending that the
other should act on that belief, and he does act on
it, then the first party will not afterwards be allowed
to insist on strict legal rights when it would be
inequitable for him to do so.

per Lord Denning in WJ Alan & Co Ltd v El Nasr Export and


Import Co [1972] 2 QB 189.

14
23. Acquiescence is generally understood in two senses. In Glasson
v. Fuller [1922] SASR 148 Poole J had alluded to the different
meaning of the terms when he said:

Acquiescence is used in two senses. If one stands


by while he sees the violation of his right in
progress, and takes no steps to intervene, he is said
to acquiesce in the violation, and he may be thereby
debarred from his remedy in respect of it. This is
acquiescence in the true sense, but its effect has
nothing to do with the lapse of time, and it has no
relation to laches. In another sense, acquiescence
is used to denote that some equitable right of A has
been violated, as where he has been induced to
make a gift by undue influence, or where there is a
cestui que trust, and his trustee has purchased the
trust property, and that after the influence has
ceased or the violation has been brought to his
knowledge he assents to the continuance of the
state of affairs resulting from the violation, to the
retention of the gift by the donee, or of the property
by the trustee. The lapse of time without
proceedings being taken by A is evidence of such
assent, and upon acquiescence of this latter kind
the doctrine of laches is based. Acquiescence in the
strict sense implies either that the party acquiescing
has abandoned his right, or that he is estopped from
15
asserting it. Acquiescence in this sense is no more
than an instance of estoppel by words or conduct.
Laches, acquiescence in the second sense, is no
defence if there is a statute of limitation in operation,
unless it exceeds the period allowed by the statute.
(at page 278)

24. Applying the aforesaid principles of law to the facts of this case,
it must follow that the defences of estoppel and acquiescence
will not avail the appellant if she undertook the construction of
the roof to the offending height after the service upon her of the
stop work notice. On the other hand, these equitable defences
will avail the appellant if there is evidence that between the
period of the commencement of the construction of the roof to
the offending height and being allowed into possession of the
house by the respondent, the respondent conducted itself in a
manner which caused the appellant to reasonably conclude that
the respondent will not enforce the building guidelines to the
letter by requiring the appellant to either limit the height of her
building to the originally approved limit of 12.97 meters or
require the appellant to demolish the offending roof of the
building upon being allowed unconditional possession of the
completed house.

25. Additionally, in our opinion, the Learned Trial Judge erred, in


law, in failing to properly and adequately consider the equitable
defences raised by the appellant. We opine to this effect by
16
reason of the summary nature in which these defences were
dismissed by the Learned Trial Judge as evidenced by this
passage in the judgment of the Court:

In regard to the defences of acquiescence,


estoppel and or waiver and laches raised by the
defendant, suffice to state that for reasons given by
learned counsel for the plaintiff in her written
submissions, this Court is of the opinion that these
defences are unsustainable both in fact and in law.

In particular, this Court agrees with the Plaintiff that


this action is based on a breach of contract against
the defendant and ought to be confined solely to the
breach complained of and the remedies in this
action. This Court ought not to take into account
other homeowners breach of the DMC which are
executed separately with the Plaintiff and the
determination of which shall form the subject matter
of other actions.

26. In our judgment, the equitable defences raised by the appellant


were clearly relevant and applicable for the following reasons.

a) First, Her Ladyship failed to appreciate that the


remedies sought by the respondent were equitable
in nature, taking the form of declaratory relief and

17
specific performance.Based on the following
pronouncements of Sir Samuel Griffith in Cashman
v 7 North Golden Gate Mining Co. [1897] 7 QLJ 152:

The term acquiescence is not a term of


art. It was used in Courts of equity as a
term to characterize a defence which
may be set up by a person against
whom another makes a claim for
equitable relief. It is a well-known
doctrine of equity that when a person
claiming equitable relief has lain for a
long time and so conducted himself that
it would be inequitable to permit him to
complain of the defendants action, the
Court will refuse to grant the relief. He
never has any right of action, because
he stands by an allows the act to be
done. Acquiescence in the other sense
is a defence to an action for specific
relief, on the ground that the Plaintiff
cannot be reinstated in his original
position without doing injustice to the
defendant, but it is not an answer to a
cause of action already accrued.
(see pages 153-154)

18
the Learned Trial Judge ought to have considered
the equitable defences raised by the appellant
before granting specific performance for the
demolition of the roof;

b) Secondly based on Her Ladyships finding of fact


adverted to in paragraph 21 of this judgment and
the judgment of the Hong Kong Court in Taikoo
Shing (Management) Ltd v. Trillon (HK) Ltd (supra),
the Learned Trial Judge appeared to adopt the
position that the equitable defences raised by the
appellant did not avail her. Her Ladyships
reasoning influenced by the reasoning of the Hong
Kong Court was essentially that the respondent was
a trustee and/or agent of the other purchasers to
enforce the terms of the DMC. Furthermore, to the
extent the appellant had voluntarily executed the
DMC, Her Ladyship ruled that it was no longer open
for the appellant to now complain that the Building
Guidelines are harsh and consequently oppressive
for the respondent to enforce the covenants against
her. In our judgment, Her Ladyship erred in applying
the aforesaid principle of law pronounced in the
case of Taikoo Shing (Management) Ltd v. Trillon
(HK) Ltd (supra) as there is no statutory duty to
enforce the covenants in the DMC, unlike the
position in the case of Taikoo Shing (Management)
19
Ltd v. Trillon (HK) Ltd (supra) (see page 311 of the
reported judgment o the Court). Indeed, in this
case, by virtue of section 35.2 of the DMC, the
respondent is not under an obligation either in law
or in equity to enforce the terms of the covenants
against other non complying Precinct 3 owners.
That the existence of a clause of this nature would
have made a difference is evident from the following
passage in the judgment of the Court:

Even if the applicant is to be treated as


agent, in the absence of clear evidence
to the contrary, it would be perverse to
hold that all owners of the estate would
authorize the agent to suffer breaches of
their rights enshrined in the DMC.
(see page 311 of paragraphs h to i)

Furthermore the Court in the case of Taikoo Shing


(Management) Ltd v. Trillon (HK) Ltd (supra) failed to
follow the ruling of the superior Hong Kong Court of
Appeal in the case of The Incorporated owners of
Oriental Gardens that the equitable defences would
avail the owners, notwithstanding the statutory
provision, so long as the management had allowed
other owners to act in disregard of the covenants to
a like extent; and
20
c) Thirdly, the case of Cheung Yuat & Another v The
Incorporated Owners of Oriental Gardens (supra) is
authority for the proposition that the property
management company vested with the
responsibility to enforce mutual covenants is
capable of acquiescing in a breach so long as the
particular breach does not destroy the whole object
for which the covenants were originally entered into
(see page 540). The Court of Appeal (H.K) also
ruled, in this case, that the question of the
floodgates being opened as a result of this decision
was without basis since the Court will not allow the
breach of a particular owner to exceed that which
other owners have been allowed to do by the
property management company previously. The
Learned Trial Judge was not persuaded by this
decision primarily because she adopted the ruling
in Taikoo Shing (Management) Ltd v. Trillon (HK) Ltd
(supra) that the property management company was
a trustee/agent to enforce the terms of the mutual
covenants and consequently bound to enforce the
terms upon there being a breach as in this case.
With respect, in our judgment, Her Ladyship erred in
treating this case as authority for the proposition
that the equitable defences relied upon by the
appellant ceased to operate if the respondent was a
21
trustee for the enforcement of the covenants on
behalf of the other owners. The fact of the matter is
that Justice Ze Li in Taikoo Shing (Management) Ltd
v. Trillon (HK) Ltd (supra) recognised that the
equitable defences would still avail the appellant as
evidenced by the following passage in the judgment
of the court:

I am not saying that waiver, estoppels


or acquiescence cannot be set up
before the time limited has expired, but I
should think the Court must be slow to
find waiver, acquiescence or estoppels
on the basis of silent or tardiness on the
part of the applicant.

27. In our judgment, if Her Ladyship had fairly considered the


equitable defences raised by the appellant, Her Ladyship would
have reached the conclusion that the defences of estoppel and
acquiescence should have prevailed for the following reasons:

a) First, the respondent had initially objected to the


continued construction of the roof to the offending
height by the appellant pursuant to the meeting of
12th June 2009. For this reason, the respondent was
duty bound to either accept or reject the appeal
originating from the appellant and received by the
22
respondent on 14th September 2009. In this respect,
it must be borne in mind that the Review Panel of
the respondent was vested with the power by the
fellow purchasers under the DMC to extend the
height of the roof beyond the originally approved
height of 12.94 meter. Learned counsel for the
respondent impliedly acknowledged this to be the
case in his submissions in the Court below as
recorded in the judgment of Her Ladyship to the
following effect:

Besides, the Guidelines allow


relaxation to be granted by the Plaintiff
on a case by case basis and in the
present case, relaxation was granted at
the height limit of 12,192 mm / 12.191m
and is solely recognized by the
defendant herself (see Q and A 85 page
163)

Besides, it is clearly provided under


section 35.2 of the DMC that nothing
therein or in the Sale and Purchase
agreement shall be construed to render
it obligatory whether at law or in equity
for the Plaintiff to enforce the terms and
covenants of the DMC against other
23
non-complying homeowners in Precinct
3.

Section 9 of the DMC clearly places the


discretion to grant relaxation on the
Plaintiffs Review Panel. To mount a
challenge on the Review Panels
exercise of its discretion is a second bite
of the cherry as the defendant was
already granted relaxation on the height
limit once.

Yet, there is no evidence that the respondent


rejected the appeal letter of the appellant of 14th
September 2009. Indeed, the evidence of PW 2 is
that together with the appeal letter or shortly
thereafter i.e on 25th November 2009, the appellant
produced fresh plans approved by the MBSA
incorporating the pitched roof to the offending
height. PW 2 acknowledged in Q & A 25 at 164 of
AR that the respondent had requested for a new set
of plans based on the conversion of the roof from
RC-flat roof to a pitched roof. PW 2 also confirmed
not having rejected the new plans following the
receipt of the same notwithstanding that it was
apparent that the height was no longer within the

24
originally approved height limit (see Q and A 30 at
174 AR);

b) Secondly, the respondent provided the appellant


with a five percent early completion rebate on 30th
September 2009. In other words, not only did the
respondent not reject the appeal letter but appears
to have rewarded the appellant with a discount for
early commencement of the building
notwithstanding that at this juncture, it was apparent
that the pitched roof was being constructed not in
accordance with the original prescribed height limit.
Admittedly, PW 2 claimed during the trial that the
discount was for goodwill reasons and that the
respondent treated the breach of the height limit as
a separate issue. With respect, in our judgment, this
may well have be the motive of the respondent but
the fact remains that the appellant as a layperson is
entitled to infer that by providing the discount so
shortly after the receipt of her appeal letter and with
knowledge of her revised plans, that the respondent
was not proposing to enforce the height restriction
in the originally approved plan. This inference no
doubt encouraged by the fact that the Review Panel
considered each case on its merits and a
substantial number of purchasers had constructed

25
their houses beyond the approved limit, without any
action having been taken against them;

c) Thirdly, the appellant was allowed to move into the


completed house on 20th December 2009 without
the imposition of any condition as regards the need
to demolish the offending roof. In this respect, when
considering the equitable defences relied upon by
the appellant, the answer of PW 2 to the following
question during cross examination is particularly
relevant:

Q: The point is that you did make this


point in your 24/6/2009 letter, but
after that there have been
development because they have
given you the plan, this time the
plan approved by MBSA. My
question is when you received the
plan and it was immediately
apparent that the height was no
longer within the height
prescription, did you write any
letter to say that this is not
acceptable?

A: No.

26
(See Q and A 30 page 174 Jilid 2 (1)
Bahagian B)

The significance of this question and answer is that


the respondent after being in possession of the
revised plans of the appellants house to the
offending height approved by MBSA unconditionally
acquiesced in the appellant taking possession of the
house. With respect, in our judgment, the appellant
cannot be faulted for assuming that the respondent
had acceded to its appeal when allowed to go into
possession without the imposition of any conditions
and;

d) Finally the fact of the matter is that there have been


similar transgressions of the covenants on the part
of other owners and the evidence suggests that this
has been tolerated by the respondent. The
respondents explanation was essentially that the
discretion was with the Review Panel (see Q and A
11 of PW 1). In our judgment, in the face of this
answer the appellant cannot be faulted for
assuming that the respondent had acquiesced in
her house being constructed beyond the approved
height limit upon not receiving a reply to her appeal,
bearing in mind that other owners had already
committed similar transgressions of the covenant
27
without any action being taken against them at that
juncture. The Court of Appeal in the case of Cheung
Yuat & Another v The Incorporated Owners of Oriental
Gardens (supra) ruled the equitable defence of
acquiescence to be applicable in such
circumstances. With respect, we are of the same
view as regards the applicability of the defence of
acquiescence on the facts of this case.

CONCLUSION

28. In our judgment, if the Learned Trial Judge had properly and
fairly considered the equitable defences raised by the appellant,
the Learned Trial Judge would have come to a different
conclusion from that in Her Ladyships judgment. In our opinion,
the error committed by the Learned Trial Judge in dismissing
these defences summarily on the premise that they were not
relevant because the respondents claim was one based in
contract, is an error of law which warrants appellate
intervention.

Accordingly, we allow this appeal in part. Order of the High


Court on declaratory prayer is hereby maintained. All other
orders of the High Court are hereby set aside. We also hereby
order that the respondent is to be indemnified for all costs and
damages that it may be ordered to pay to other purchasers of
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houses in Precinct 3 by a Court of law, arising from the
appellants breach of the covenant relating to the height of the
house on the appellants land. We make no order as to costs
and order the deposit to be refunded to the appellant.

Sgd.
ANANTHAM KASINATHER
JUDGE
COURT OF APPEAL MALAYSIA
PUTRAJAYA

DATE OF DECISION: 21st JUNE 2013


DATED THIS: 14th OCTOBER 2013

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COUNSEL FOR THE APPELLANT:
Mr. M. Rajendran Navaratnam
(together with Ms. Choo Mun Wei)
Tetuan MK Chen & Leong
Peguambela & Peguamcara
Suite B-9-2, Plaza Mont Kiara
50480 Kuala Lumpur

COUNSEL FOR THE RESPONDENT:


Ms. Olivia Goh
Tetuan Gananathan Loh
Peguambela & Peguamcara
B-06-12 Gateway Kiaramas
No. 1 Jalan Desa Kiara
Mont Kiara
50480 Kuala Lumpur

REFERENCE:

1. Taikoo Shing (Management) Ltd v. Trillon (HK) Ltd [1997] 4 HKC


304

2. The Incorporated Owners of Hoi Luen Industrial Centre & Anor


Ohashi Chemical Industries (Hong Kong ) Ltd [1952] 2 HKC 11

3. Cheung Yuat & Another v The Incorporated Owners of Oriental


Gardens [1979] HKLR 536

4. WJ Alan & Co Ltd v El Nasr Export and Import Co [1972] 2 QB


189

5. Glasson v. Fuller [1922] SASR 148

6. Cashman v 7 North Golden Gate Mining Co. [1897] 7 QLJ 152


30