KUALA LUMPUR (Sept 11): The High Court last week granted an injunction sought by 46 house buyers of Lakefront Villa @ Cyberjaya in Dengkil, Sepang, barring the developer and its subsidiaries from carrying out commercial development on the said property.

Judicial Commissioner (JC) Leong Wai Hong further granted a declaration that the Lakefront Villa @ Cyberjaya project is to be a housing/residential development project comprising 110 units and that the area is to be used for residential purposes only.

The house buyers named Lakefront Residence Sdn Bhd, Timeless Hectares Sdn Bhd and MCT Bhd (now known as Avaland Bhd) as defendants in the action filed in April last year, where they alleged developers Lakefront Residence and Timeless Hectares as wholly owned subsidiaries of MCT Consortium Bhd.

MCT Consortium is a wholly owned subsidiary of MCT.

The house buyers contended that the defendants had made false representations to them that the “maiden project” would be a “gated and guarded development with only 110 exclusive luxury villas surrounding a panoramic lake".

They further alleged that the developer had breached the sales and purchase agreement (SPAs) they entered with the company between 2014 and 2020. The commercial project was rejected by the local council in 2020. This decision was then overturned by the Selangor Appeal Board in 2021, resulting in its revival.

Leong in his 68-page decision quoted a Malay proverb Kata itu kota, which means a promise made must be honoured, or the English equivalent “A man’s word is his bond”.

Leong went on to say that as the developer and its partners made representations on their websites, newsletters, brochures and in the show model in its showroom, the court assumed the house buyers only had these to go on when making their purchases.

The court said although there were disclaimers on the brochures, it ruled that these cannot be relied on as they were in too fine a print.

“A disclaimer that cannot be read by the normal eyes has no valid legal effect,” Leong ruled, adding that MCT had acted on behalf or in complicity with the two other defendants to make the representations and that the disclaimers have no legal effect.

Although the companies argued the locus standi (legal standing) of the house buyers in filing the suit as they do not represent the joint management body (JMB), Leong ruled the law is settled that an SPA is an individual contract between a house buyer and the developer.

“The house buyer is therefore entitled to pursue his individual contractual rights, as a private cause of action, without the need to rely on the JMB to sue on his behalf. To impose such a burden would, in my respectful view, be a travesty of justice,” he said.

“The court, as the Federal Court holds, must ensure maximum protection for homebuyers,” the JC added.

Following that, Leong allowed the injunction sought by the 46 residents.

The residents were represented by counsel Ravindran Shanmuganathan while Justin Voon and Tan Ko Xin appeared for the defendants.