Developer Late? How to Work Out Your LAD Claim in Malaysia

Say your condo handover is 200 days late. Counted from your booking fee date, the claim in this guide's example is about RM32,877. Counted from the SPA date, it is only about RM22,849.

Usually, yes. For most new homes in Peninsular Malaysia, the payout for late delivery is already written into the standard SPA. It is called liquidated ascertained damages (LAD), and this guide explains the formula, when the clock starts, what can stop it and where to claim.

Near the end you will find practical tips for buyers claiming late delivery compensation.

What is LAD and why don't you have to prove loss?

LAD is compensation a developer must pay when it delivers vacant possession later than the SPA allows. Private housing projects under the Housing Development (Control and Licensing) Act 1966 must use a standard SPA set out in the Housing Development (Control and Licensing) Regulations 1989.

• Schedule G is the standard SPA for landed homes.
• Schedule H is the standard SPA for stratified homes such as condos and apartments.

Because the rate is fixed by law, you do not need to show what the delay actually cost you. The amount is agreed in advance, which is why it is called liquidated and ascertained. If your SPA is not on Schedule G or H, these rules may not apply, so check the form first.

The Act covers Peninsular Malaysia. Sabah and Sarawak have their own housing laws.

When are the keys due, and how is LAD calculated?

• Landed (Schedule G): vacant possession within 24 months.
• Strata (Schedule H): vacant possession within 36 months.

If the developer misses the deadline, LAD runs for every day of delay until vacant possession is delivered or the SPA is terminated, whichever comes first. The rate is 10% a year of the purchase price, calculated day by day rather than in whole months.

1. 1Take the purchase price stated in your SPA.
2. 2Multiply it by 10% to get the yearly LAD.
3. 3Divide by 365 to get the daily rate.
4. 4Multiply by the number of days the handover was late.

When does the LAD clock start?

In PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah, decided in January 2021, the Federal Court held that the delivery period runs from the date you paid the booking fee, not the later date you signed the SPA.

That matters because many buyers pay a booking fee weeks or months before the SPA is signed. Counting from the SPA date would quietly give the developer extra time. Dig out your booking fee receipt, because it may move your deadline earlier than you think.

Can the developer get more time?

For years, developers obtained extensions from the Controller of Housing under regulation 11(3) of the 1989 Regulations. In Ang Ming Lee & Ors v Menteri Kesejahteraan Bandar, Perumahan dan Kerajaan Tempatan, decided on 26 November 2019, the Federal Court ruled that the Controller had no valid power to grant them.

That left a big question over older extensions. On 26 July 2024, in Obata-Ambak Holdings Sdn Bhd v Prema Bonanza Sdn Bhd, the Federal Court held that Ang Ming Lee applies prospectively. Controller extensions granted before the 2019 ruling still protect the developer for the extended period.

The same court also refused LAD to buyers who had signed their SPAs knowing about the extended period, raised no objection and took vacant possession before claiming. It treated the six-year limitation period as running from the date the SPAs were signed.

Projects caught by the 2020 movement control order have one more adjustment. Covid-19 temporary measures law excluded the period from 18 March 2020 to 31 August 2020 from the delivery count, and some developers received further extensions under it.

Where can you claim, and how long do you have?

The cheapest route is the Tribunal for Homebuyer Claims (Tribunal Tuntutan Pembeli Rumah). Filing costs RM10, and the Tribunal aims to make its award within 60 days. Awards can be enforced like a court order.

• Limit: section 16M of the Act caps each claim at RM50,000. A 2024 proposal to raise it to RM250,000 drew objections from buyer groups, so check the current limit when you file.
• Above the limit: you can abandon the excess to stay at the Tribunal, or sue for the full amount in court.
• No splitting: you cannot break one LAD claim into smaller claims. The Federal Court has held that the cap applies per claim, so a separate claim on a different issue, such as defects, is assessed on its own.
• Deadline: file within 12 months of the earliest of the certificate of completion and compliance (CCC), the end of the defect liability period, or termination of the SPA before CCC.

What it looks like in real numbers

Here is an illustration. Say you buy a RM600,000 condo under Schedule H.

You pay the booking fee on 1 March 2022 and sign the SPA on 1 May 2022. Vacant possession is delivered on 17 September 2025.

• Yearly LAD: 10% of RM600,000 = RM60,000.
• Daily rate: RM60,000 / 365 = about RM164.38.
• Counted from the booking fee date, the 36-month deadline is 1 March 2025, so the handover is 200 days late: about RM32,876.71.
• Counted from the SPA date, the deadline is 1 May 2025, so it is only 139 days late: about RM22,849.32.

The booking fee date adds about RM10,027 to your claim in this example. Both figures sit under RM50,000, so the Tribunal would be the natural route.

What are the best tips for claiming LAD from a late developer?

Seven steps that protect your claim:

1. 1Find your booking fee receipt. The Federal Court held that the delivery period runs from the booking fee date, not the SPA date.
2. 2Check which SPA you signed. These rules apply to the standard Schedule G (landed) or Schedule H (strata) forms.
3. 3Know your deadline. Landed homes get 24 months and strata homes 36 months.
4. 4Work out your own figure. Price x 10% / 365 x days late, then compare it with any number the developer offers.
5. 5Check for extensions. Controller extensions granted before the 26 November 2019 ruling can still protect the developer.
6. 6File within 12 months. The Tribunal charges RM10 and caps each claim at RM50,000.
7. 7Do not split one claim. You cannot break one LAD claim into smaller ones to get round the cap.

Bottom line

LAD is not a favour from the developer. It is a fixed term of the standard SPA, worth 10% a year of your price for each day of delay, counted from the booking fee date.

Work out your own figure, check whether any extension applies to your project, then file at the Tribunal within 12 months. If the amount is above RM50,000 or the facts are messy, take your papers to a lawyer early, as time limits apply.