Our Hong Kong-based client engaged CHERN & CO. to resolve a significant complication surrounding their purchase of a luxury home in Genting Highlands, which they had acquired through a sales agency in Hong Kong.
Our Jonathan K represented our client in this matter before the Kuala Lumpur High Court.
Case Overview
At the time our client sought our assistance, they had already paid the full purchase price of approximately HKD 3 million to the Genting Developer’s sales agency in Hong Kong (“HK Sales Agent”). However, six months later, the Genting Developer informed our client that they had received only RM5,000 of the payment, alleging that no further funds had been transferred by the HK Sales Agent. The developer then warned our client that unless further payments were made directly, their Sale and Purchase Agreement (SPA) would be terminated, risking the loss of the property.
Complications and Legal Disputes
This case became more complex as both the Genting Developer and the HK Sales Agent issued public statements in Hong Kong, each accusing the other of fraudulent conduct. Both parties lodged police reports against each other in Hong Kong:
- Genting Developer claimed to be the victim of an elaborate fraud, alleging that the HK Sales Agent had received purchaser funds without authorization and issued falsified receipts and documents.
- HK Sales Agent maintained that, although no longer representing the Genting Developer, they had no authority to refund the purchase money to purchasers.
The Genting Developer further denied any receipt of funds from purchasers, including our client, and claimed no responsibility for the transactions conducted by the HK Sales Agent.
Strategic Legal Action
Given the circumstances, our legal team advised the client to pursue legal action via an Originating Summons—a strategic choice designed to expedite the legal process and minimize costs compared to a traditional Writ of Summons.
Understanding Originating Summons
An Originating Summons is a streamlined method of commencing civil action, characterized by:
- Affidavit-Based Proceedings: The case is presented through detailed affidavits, supported by documents, with no requirement for witness testimony. In this instance, our client’s case was supported by nine volumes of documentation.
- Efficiency: The process is faster and more cost-effective, with hearings conducted in chambers between lawyers.
Court’s Decision
On July 6, 2023, the Kuala Lumpur High Court ruled in favor of our client, granting the following:
- Declaration of Validity: The Sale and Purchase Agreement between our client and the Genting Developer remains valid, binding, and effective.
- Recognition of Ownership: Our client is confirmed as the lawful purchaser of the property in Genting Highlands.
- Compliance with Obligations: The Court acknowledged that our client had fulfilled all obligations under the Letter of Intent to Purchase and the SPA, including full payment of HKD 2.9 million.
- Costs Awarded: The Court ordered that costs be paid to our client.
This ruling not only secured our client’s property rights but also set a precedent for handling complex international property disputes.
Speak To Us
To discuss any points raised in this article or to inquire about the most cost-effective way to commence legal action, please contact us at +603 6419 9511 or email info@chernco.com.my.
Note: This article is for informational purposes only and does not constitute legal advice. For further assistance, please reach out to our Kuala Lumpur office.