Does a Licensed Land Surveyor owe a duty of care to a Subsidiary Management Corporation, prior to its formation?

Menara 1 MK Subsidiari Management Corporation v 1 Mont Kiara Dan Kiara 2 Management Corporation & Chuang Kuang Han (Kuala Lumpur Civil Suit: WA-22NCvC-720-11/2024)

FACTS OF THE CASE

The dispute centres on the designation of limited common property, which the Plaintiff, a Subsidiary Management Corporation (SMC), alleges was negligently carried out. The Plaintiff’s concerns arise primarily from the absence of a designated management office for its exclusive use. Consequently, the Plaintiff initiated a claim against the Management Corporation (MC) and the Second Defendant (D2), a licensed land surveyor.

A striking out application was subsequently filed on behalf of D2. In allowing the application, the Honourable Judicial Commissioner (JC), Yang Arif Arziah binti Mohamed Apandi, sitting in the High Court at Kuala Lumpur, held that the Plaintiff’s claim against D2 constituted a clear abuse of process. Accordingly, the claim was struck out as against D2.

FINDINGS OF THE COURT

The Honourable JC has stated the following in her decision;

1. The central issue was whether the suit concerned a matter of public law or private law. The Honourable JC referred to the Federal Court decision in Ahmad Jeffri and held that the Plaintiff’s prayer for a declaration that the special plan be amended amounted to a challenge against the validity of authority approvals under Section 17A of the Strata Titles Act 1985. Accordingly, the substance of the claim was one of public law.
2. The Honourable JC further held that there was no evidence of any private law cause of action brought against D2.
3. Given that the subject matter involved a challenge to an administrative act, it fell within the domain of public law and ought to have been commenced by way of judicial review under Order 53 of the Rules of Court 2012.
4. The Honourable JC also found that there was a contravention of the audi alteram partem principle. Citing the decision in Obata Ambak, Her Ladyship emphasized that all affected parties must be given an opportunity to be heard, and that no binding decision may be made against persons who are not parties to the proceedings. There was therefore a clear non-joinder of necessary parties.
5. The Honourable JC held that JUPEM and the PTG ought to have been joined as parties to the suit, as both entities bore statutory responsibilities not only to accept the special plans but also to review and provide comments on the said plans in relation to the establishment of the Subsidiary Management Corporation (SMC).
6. Her Ladyship reaffirmed that declaratory relief will not be granted unless all persons who would be affected are before the Court.
7. It was further held that there was no legal nexus between the Plaintiff and D2, as D2 had been appointed by the MC, and D2’s scope of work had been completed before the Plaintiff was even established.
8. Relying on the decisions in Steven Phoa and Cosmopolitan Avenue, the Honourable JC held that a duty of care does not extend to professionals whose engagement was by the MC.
9. The Honourable JC found that D2 had complied with all applicable statutory requirements and JUPEM guidelines in the execution of its duties.
10. The evidence also showed that D2 had given a detailed two-hour presentation to the proprietors, explaining the special plan and the designation of common areas.
11. The Honourable JC found that the comprehensive resolution passed by an overwhelming majority of the proprietors could not be unilaterally set aside by the Plaintiff.
12. The Honourable JC also observed that the Plaintiff’s conduct was unreasonable, as all three Subsidiary Management Corporations (SMCs) had operated without dispute for five years. The Plaintiff could not approbate and reprobate, having acquiesced in the implementation of the Special Plan over an extended period.
13. The suit was held to be an abuse of process, filed with the intention of circumventing the limitations applicable to judicial review, which the Plaintiff had failed to pursue in 2019.
14. Accordingly, the Honourable JC struck out the suit against D2, with costs of RM8,000.00 awarded to D2’s solicitors.

TAKEAWAY

The Court held that a licensed professional surveyor cannot be held liable for a special plan that was duly adopted pursuant to a comprehensive resolution passed by the Subsidiary Management Corporation (SMC), particularly where the SMC had not yet been established at the material time. A duty of care cannot be imposed in favour of an entity that did not exist at the time the professional duties were performed.

Furthermore, special plans that have been reviewed and approved by the Land and Mines Office (PTG) and the Department of Survey and Mapping Malaysia (JUPEM) cannot be casually impugned. Any challenge to such plans must be brought by way of a public law action vide judicial review, and the relevant approving authorities must be made parties to the proceedings.