Our HK Client engaged CHERN & CO. to help them resolve a “complication” regarding their purchase of a luxury home in Genting Highlands which they bought through a Sales Agency in Hong Kong.
Our Jonathan Khaw represents our HK Client in this matter before the Kuala Lumpur High Court.
Brief Facts
At the time our Client came to us, it is noteworthy that they had FULLY PAID the purchase price of approximately HKD 3 million to the Genting Developer (or equivalent to almost 1.8 million Ringgit Malaysia as of this writing). The full purchase money was paid to the Genting Developer’s Sales Agency based in Hong Kong (referred to as “HK Sales Agent”).
Nevertheless, six months after full payment, our Client was informed by the Genting Developer that they had yet to receive any payment from our Client other than a mere RM5,000.00. Our Client was further informed that the Genting Developer had formally terminated their agency relationship with their HK Sales Agent. The Genting Developer then explicitly warned our Client to make further payments to secure their property or risk having their Sale and Purchase Agreement terminated- which would mean losing the property indefinitely.
As if this is not interesting enough by itself, the following events then ensued:-
- Genting Developer and its HK Sales Agent had both issued separate Public Statements relating to the said project in Hong Kong, levelling severe accusations against each other for dishonest and fraudulent conduct;
- Both sides also lodged police reports against each other in Hong Kong;
- Genting Developer claimed that it was a victim of an elaborate fraudulent scheme whereby it alleged, among others, that its HK Sales Agent had received purchaser’s monies without authorization (including our Clients’) and issued false receipts and “doctored” documents to purchasers in Hong Kong;
- Genting Developer denied receipts of any purchase money from purchasers in Hong Kong, including our Clients’;
- HK Sales Agent took the position that although they were no longer the Sales Representative of the Genting Developer, they had no authority to refund any of the purchase money to the Purchasers in Hong Kong;
- Genting Developer assumed the position that they were unaware of what transpired between our Client and the HK Sales Agent, as HK Sales Agent had breached the Agency Contract and committed a fraudulent act against the Genting Developer;
- Genting Developer clarified that they would not recognize our Client as their purchaser as they have never dealt with our Client and, therefore, should not be held liable for their losses, if any.
Mode of Commencement of Legal Action: Originating Summons
Our Jonathan Khaw advised our HK Client to pursue legal action against the parties concerned through Originating Summons instead of the usual Writ of Summons, which would consume substantial time that leads to higher legal fees.
What is Originating Summons?
It is one of the two modes of commencing a civil action. The features of Originating Summons are as described below:
- Our Client’s case is made through Affidavits, by way of exhibiting supporting documents to support their position, which in this case, ran into 9 thick volumes of documents!;
- No witnesses or oral testimony are required, unlike a Writ of Summons Action where witnesses must be called to give evidence in Court and to be examined by counsels.
- The legal process can be fairly quick and hence, save on expensive legal fees;
- Hearings are in chambers between lawyers.
On the morning of 6th July 2023, the Kuala Lumpur High Court allowed our HK Client’s Originating Summons and further ordered and granted the following in favour of our HK Client:-
- A declaration that the Sale and Purchase Agreement between our HK Client and the Genting Developer is still subsisting, valid, binding, and effective between the parties;
- A declaration that our HK Client are the lawful purchaser of their unit in Genting Highland;
- A declaration that our HK Client has complied with all their obligations under relevant terms, namely, Clause 3 of the Letter of Intent to Purchase and both Clause 4 and 5 of the Sale and Purchase Agreement whereby a full sum of HKD2,900,000.00 was duly paid as full consideration for the purchase of the said Property under the Sale and Purchase Agreement; and
- Costs to be paid to our HK Client.
Speak To Us
To discuss any points raised in this Article, or you wish to inquire which mode you should use to commence legal action to save Costs, please call us at +603 6419 9511 or email us at info@chernco.com.my.
Note: This Article does not constitute legal advice. For further information, don’t hesitate to contact our Kuala Lumpur office.