The Star
by Roger Tan
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Protection needed: It is time for the
government to introduce a legislation or extend the protection currently given
to consumers under the Consumer
Protection act, 1999 to all types of
contracts, including financial dealings and transactions, involving,
particularly, purchasers and borrowers of a housing development.
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In April 2008, a British couple living in the United Kingdom obtained a loan facility of RM715,487 to finance the purchase of their property in Malaysia. It was a term of the loan facility that the bank would make progressive payments to the developer against certificates of completion issued by the architect at each progress billing.
In March 2014, the developer sent a notice for a progressive payment to the bank, supported by an architect’s certificate.
The bank’s disbursement department then sent several internal emails to its branch to conduct site visit inspection on the property.
The branch did not do anything, and meanwhile, the due date for payment had also expired on March 25, 2014.
Neither did the bank notify the developer nor the couple that a site visit inspection was an additional condition precedent to drawdown.
The bank also did not request for any extension of time to make the payment pending the completion of the site visit.
On April 10, 2015, the developer terminated the sale and purchase agreement (SPA), after about one year from the issuance of the invoice.
The couple then sued the bank for breach of agreement and/or negligence.
In March 2014, the developer sent a notice for a progressive payment to the bank, supported by an architect’s certificate.
The bank’s disbursement department then sent several internal emails to its branch to conduct site visit inspection on the property.
The branch did not do anything, and meanwhile, the due date for payment had also expired on March 25, 2014.
Neither did the bank notify the developer nor the couple that a site visit inspection was an additional condition precedent to drawdown.
The bank also did not request for any extension of time to make the payment pending the completion of the site visit.
On April 10, 2015, the developer terminated the sale and purchase agreement (SPA), after about one year from the issuance of the invoice.
The couple then sued the bank for breach of agreement and/or negligence.
