Court: Developer who collected RM1.6m in rent for pool, clubhouse over 14 years had no right to own the facilities

PUTRAJAYA — The Court of Appeal has reportedly ruled that the clubhouse, swimming pool and two additional spaces at Langkawi’s CHOGM Villa are part of the condominium’s common property, ending a decade-long dispute in which residents accused the developer of wrongfully claiming the facilities as its own.

According to a report in Free Malaysia Today, the case began after the management corporation discovered at its first annual general meeting in 2013 that Baiduri Heights Development Sdn Bhd (Baiduri Heights) had been treating the clubhouse and swimming pool as private assets.

The developer had reportedly collected RM9,000 per month in rental fees, accumulating RM1.6 million over the years.

Residents later found that 210 strata titles had been issued by the Langkawi district land office despite the project consisting of only 208 approved townhouse units, and that the developer continued to assert ownership even though the land was registered under the management corporation.

In its unanimous decision, a three-judge panel led by Justice Datuk Wong Kian Kheong affirmed an initial High Court finding that the facilities were always intended as “common property” under the Strata Titles Act 1985 and the approved layout plan, which listed them as part of the development’s amenities.

Wong reportedly said the High Court had correctly held that the developer was not the rightful owner, and that the management corporation had standing to bring its counterclaim, which was not time-barred under any legislation cited.

The panel also ruled that the Langkawi land administrator and the Kedah land and mines director were liable for misfeasance in public office for approving two additional strata titles for the disputed spaces, making the state government vicariously liable.

The court further upheld the High Court’s findings that the developer and its property management subsidiary had committed conversion, fraud, breach of trust and unjust enrichment.

The panel, which also comprised Justices Datuk Azimah Omar and Datuk Ismail Brahim, dismissed the developer’s appeal against the rejection of its main suit and ordered the company and three individuals to pay RM85,000 in costs to the management corporation.

CHOGM Villa, built in 1998 and comprising 208 townhouses, a clubhouse and a swimming pool, was developed by Baiduri Heights and received its certificate of fitness that same year.