Good Intentions Didn’t Save the JMB: Court of Appeal Imposes Liability for Obstructing Developer’s Works

In a significant decision on economic torts and strata management duties, the Court of Appeal in Saujana Triangle Sdn Bhd v Armanee Terrace Joint Management Body & Ors [2025] CLJU 2851 has partially allowed the Developer’s appeal, overturning the High Court’s dismissal and awarding nominal damages for unlawful obstruction of access by the Joint Management Body (JMB) and its committee members.

When the scope of powers is exceeded, even a well-intentioned motive is no defence. Though JMB and its committee members derive their authority from the Strata Management Act 2013 (SMA), such authority is strictly limited to the maintenance and management of common property and parcels that have already been delivered with vacant possession. It was unequivocally held by the Court of Appeal that a JMB has no lawful authority under the SMA to obstruct a Developer’s reasonable access through common property to complete an incomplete phase of a single-title development — irrespective of how sincerely they believe they are safeguarding resident security. As ruled in the case, such deliberate and concerted obstruction over several years constituted unlawful means conspiracy and tortious interference with trade. Significantly, predominant intention to injure is not required; knowledge that the obstruction would inevitably delay vacant possession and crystallise substantial LAD liability is sufficient for liability to attach. This decision serves as a stark warning to all JMBs, Management Corporations, and individual committee members — exceeding statutory powers exposes both the body and its office-bearers personally to liability in economic torts, regardless of motive. Good faith may be irrelevant when the means used are unlawful.

A victory on liability is bittersweet without proof of quantum. While the Developer succeeded in establishing the JMB’s tortious conduct, they were only awarded nominal damages because the Developer failed to adduce the essential evidence required to quantify its loss: (i) Sale & Purchase Agreements to prove contractual completion dates, (ii) a proper delay analysis linking specific periods of obstruction to the late delivery, and (iii) documentary proof (payment vouchers, bank statements, or audited accounts) that LAD had actually been paid to purchasers. In our view — and this is the key lesson for every Developer — the claimant in this case should have called experts (whether from a quantity surveyor, forensic accountant, planning/delay expert, or even an experienced solicitor) to establish causation and compute the precise financial impact of the obstruction. Given that the Court ruled that liability was established against the JMB, the Developer had an indisputable right of access and clear contractual obligations to its purchasers, the opportunity to succeed in obtaining a court order for the full measure of its losses may have been feasible. This outcome underscores a fundamental litigation principle: winning liability is merely the opening act; recovering substantial damages demands meticulous, contemporaneous evidence from the outset.

Background of Facts

The Developer of Armanee Terrace, completed Block A in 2005 but faced delays in Block B due to contractor issues. Block A provided the sole access route to Block B. From 2013–2017, the JMB of Armanee Terrace (1st Respondent) and its office-bearers (2nd–8th Respondents) repeatedly denied or severely restricted the Developer’s contractors from passing through Block A to carry out essential infrastructure works, and later restricted access to unsold Block B units. The Developer claimed the restriction has caused late delivery of vacant possession (2016 instead of 2014), triggering liquidated ascertained damages (LAD) of over RM100 million to Block B purchasers, and subsequently, lost sales and rental income.

Arguments by Parties:

• Developer (Appellant): The JMB committed (i) unlawful interference with trade/business, (ii) unlawful means conspiracy, and (iii) breach of statutory duty under the SMA by obstructing access despite the directions from the Commissioner of Buildings (COB) and court orders.
• JMB & Committee Members (Respondents): It was the JMB’s contention that they were protecting the security, safety and interests of occupied Block A residents. Moreover, access was refused until documents were provided and there was no intention to injure the developer. The claims barred by res judicata from earlier proceedings.

Rulings

High Court: Entire suit filed by the Developer was dismissed. The learned trial judge found obstruction occurred but held there was no intention to cause loss or breach of statutory duty as the acts were to protect and prioritize Block A. Thus, the claim was res judicata from prior litigation.

Court of Appeal: Developer’s appeal was unanimously allowed in part:

• Overturned the High Court on the economic torts: The JMB and committee members had acted in concert and used unlawful means as they had no legal basis to block access through common property. It was highlighted that although intention to injure need not be predominant in unlawful means conspiracy, knowledge of inevitable harm which is to trigger the LAD was sufficient.
• Statutory Duty under Section 21 of the Strata Management Act 2013: Dismissing the Developer’s argument — it was upheld that there was no breach of statutory duty under the said provision. The statutory duties relate to maintenance of existing common property would only arise upon delivery of vacant possession and not pre-vacant-possession works on Block B, which was unoccupied at the moment.
• Rejected res judicata: The earlier suits dealt with different issues (previously was regarding unhindered access to its own purchased units) and damages had not crystallised then.
• Failure to Prove Quantum: The Developer failed to bring forward SPAs and other documentary evidence to prove quantum of loss and damages incurred due to JMB’s obstruction. Therefore, there is no evidence linking specific delays to JMB’s obstruction, and no proof actual LAD payments were made.

As a result, the Court of Appeal awarded nominal damages of RM10,000 for clear infringement of the Developer’s rights with costs of RM80,000 (JMB) + RM100,000 (individual respondents).

Key Takeaways for JMBs & Developers

1. JMB’s authority to block Developer’s access: A JMB has no lawful authority to block a Developer’s legitimate access through common property to complete an incomplete phase, even if residents demand it for “security”.
2. Clarification of Unlawful Means: Obstructing access can constitute unlawful means conspiracy and unlawful interference with business in which predominant intent to injure is not required. Prioritizing resident interests does not absolve liability when unlawful means are used.
3. Duty of Claimants: Claimants must still prove causation and quantum rigorously. Failure to produce SPAs, delay analyses and payment evidence will limit recovery to nominal damages even when liability is clear. Alternatively, Developer may commission an independent delay and quantum expert report.