JCW

[Assessment of Damages – effect of previous consent order, abandoned medium costs apartment replaced by high end condominium, unjust enrichment, etc] This is an Appeal emanating from an assessment of damages, where the Court of Appeal dismissed the Appeal against the High Court decision where the Learned High Court Judge agreed with the respondent's/defendant's expert valuation report and rejected the appellant's /plaintiff's expert valuation report and the High Court also dismissed the appellant's/plaintiff's claim for liquidated ascertained damages (LAD) or alternatively loss of rental. After a series of litigation and appeal leading to the Federal Court , the Plaintiff did not succeed on specific performance and merely obtained damages against the Defendants The Grounds of Judgment of the Court of Appeal involves the important consideration of the question of law as to amongst others : (i)the effect of a Consent Order earlier entered by parties on the assessment of damages and whether it has now become academic and/or superseded (ii) unjust enrichment and whether the valuation should be based on a medium costs apartment (project abandoned) or a high end condominium ( built) (iii) effective date of valuation i.e. whether it should be based on the date of breach of contract or the Federal COurt decision binding parties (iv) whether the Plaintiff can still claim for LAD and/or rental when they are not entitled to specific performance The Court of Appeal held amongst others as follows :  (1)  Upon analysing the contemporaneous matters of the Court of Appeal Grounds of Judgment in Antara Vista Sdn Bhd v Rumaya Properties Sdn Bhd [2017] MLJU 1964; the Broad Grounds of the Federal Court decision and also the terms of the Consent Order, the Court is of the considered view that the Court of Appeal Order which was affirmed by the Federal Court should be the basis of assessment of damages before the High Court. (2) Based on the Court of Appeal Grounds of Judgment, the Court agree with learned counsel for the defendants' submission that the Court of Appeal  had directly ruled and held that "a monetary compensation would be the appropriate remedy to be awarded to the plaintiff in relation to the 18 units of medium-costs apartments that formed the subject matter of the 18 principal agreements". By this specific reference, the only inference that can be drawn is that the Court of Appeal is of the view the damages to be assessed should be based on the value of the medium- cost apartment in Vista Damansara and not the high -end condominium in Boulevard Residence. (3) It is pertinent to note that the Court of Appeal in Antara Vista did consider the issue of unjust enrichment and the differences between the development of Vista Damansara and Boulevard Residence. From the excerpt of the  of the Federal Court's Broad Grounds, the Federal Court took into account relevant factors to award damages in lieu of specific performance to the Plaintiff including amongst others "the present status of the subject matter" and "the element of unjust enrichment" (4) As to the element of "unjust enrichment"  it is crystal clear that the order of specific performance would unjustly enrich the Plaintiff. From the undisputed facts, the plaintiff paid a total sum of RM2,657,950 under the SPAs to purchase the medium costs apartments and If the order of specific performance is allowed, the value of 18 high end condominium as certified by the Plaintiff's valuer is in the whopping sum of RM12,822,0000 a nearly five fold increase comparing to the transacted value. (5) The Consent Order should be read in a purposive manner. From the choice of words used in the Consent Order, it's obvious that the 1st defendant desires to proceed with the development of Boulevard Residence and at the same time agreed to preserve the Plaintiff's right to make a claim against the 2nd defendant. Based on the scheme the intention was to preserve the status quo in the event that the Plaintiff succeeds in getting the specific performance order of the SPAs (6) Once the Court of Appeal and the later Federal Court disallowed the Specific Performance Order to the Plaintiff, the purpose of the Consent Order  can no longer stand. It has became academic or superseded by the apex court's decision. The Consent Order is no longer enforceable in the assessment of damages since the purpose of the order is overtaken by event or in other words became obsolete. (7)  The effective date of valuation for the assessment of damages should be as at the date the contract is lost i.e. the date when the land was transferred on 11/3/2008 and not the date of the Federal Court decision on 28/8/2019 (9) The Plaintiff's claim for LAD and/or alternatively rental of the 18 medium costs apartment do not arise at all in view of the fact that the plaintiff is not entitled to specific performance of the units. In other words, the claim for LAD or loss of rental is only possible if the Plaintiff is entitled to physical possession of the units and there is a delay in the delivery of vacant possession, which is not the case here. It is not disputed the 2nd defendant has abandoned Vista Damansara's development and no longer has the ability to deliver vacant possession of units to the Plaintiff under the SPAs.