New launch delivered late? How to claim LAD (late delivery compensation) in Malaysia
If your new launch is delivered late, the statutory sale and purchase agreement under the Housing Development (Control and Licensing) Act 1966 (Act 118) — Schedule G for landed, Schedule H for strata — entitles you to liquidated ascertained damages (LAD) of 10% per annum of the purchase price, calculated day by day from the contractual deadline until actual delivery of vacant possession. On a RM500,000 unit, that is RM50,000 per year, roughly RM137 a day — a six-month delay works out to about RM25,000 (RM500,000 × 10% × 182 ÷ 365 = RM24,932).
LAD is not paid automatically. You claim it: demand letter first, then the Tribunal for Homebuyer Claims (up to RM50,000), then court above that. The steps, the traps, and the case law that moved the goalposts are below.
How is LAD calculated — and when does the clock start?
The formula, as set out in the statutory schedules and published by housing lawyers (e.g. Lui & Bhullar): purchase price × 10% × days of delay ÷ 365. A separate LAD (Schedule H: 10% per annum of the last 20% of the purchase price) applies to late completion of common facilities.
| Schedule G (landed) | Schedule H (strata/high-rise) | |
|---|---|---|
| Delivery deadline | 24 months | 36 months |
| Counted from | The date you paid the booking fee — not the SPA date | |
That last row is the Federal Court's doing. In PJD Regency Sdn Bhd v Tribunal Tuntutan Pembeli Rumah (2021), the apex court held that where a booking fee was collected before the SPA was signed, the delivery period — and therefore LAD — runs from the date of that payment. Developers used to leave SPAs unsigned for months to push the deadline back; that practice is dead. Dig out your booking fee receipt: it may be worth thousands of ringgit.
What counts as "delivered"? Keys alone are not enough
The LAD clock stops at valid delivery of vacant possession — which requires more than a key-collection ceremony. Under the statutory SPA, vacant possession comes with the certificate of completion and compliance (CCC) and the unit ready for occupation. The Federal Court went further in Remeggious Krishnan v SKS Southern Sdn Bhd (2023): "ready for connection" means there must be actual water and electricity supply to the unit at handover. A developer who hands over keys to a unit with no working utilities has not properly delivered — and remains exposed to damages even if the paper deadline was met.
So when computing your delay, the end date is the date of a valid vacant possession notice backed by CCC and live utilities — not the date the sales office first invited you to collect keys. What happens after handover has its own rules and deadlines: see our handover and defect liability guide.
What if the developer got an extension of time (EOT)?
An EOT granted by the housing authorities extends the delivery deadline — and erases LAD for the extended window. This is the most litigated corner of housing law, so here is the citable state of play:
- Ang Ming Lee v Menteri Kesejahteraan Bandar (Federal Court, 2019): the Controller of Housing had no power to grant EOTs under regulation 11(3) — the regulation was held ultra vires the Act. EOTs granted that way were invalid, and buyers could claim LAD as if no extension existed.
- Obata-Ambak Holdings v Prema Bonanza (Federal Court, July 2024): Ang Ming Lee applies prospectively only. EOTs granted before the Ang Ming Lee decision (26 November 2019) cannot be unwound retrospectively — buyers relying on those older EOTs being "invalid" lost their claims.
Practical translation: if your SPA carries an EOT, its date matters enormously, and the law here has shifted twice in five years. Do not self-assess an EOT case — have a housing lawyer read the actual documents. This is one of several traps covered in our legal pitfalls guide.
How do you actually claim LAD?
- Assemble the paper: SPA, booking fee receipt (your start date), the vacant possession notice, and the CCC date. Compute the delay: price × 10% × days ÷ 365.
- Send a written demand to the developer with your calculation. Some developers pay; many counter-offer with "free maintenance fees" or rebates — do the arithmetic before accepting anything in kind.
- File at the Tribunal Tuntutan Pembeli Rumah (Tribunal for Homebuyer Claims) if your claim is within its RM50,000 jurisdiction — filing is cheap and no lawyer is needed.
- Go to court for amounts above RM50,000, with a lawyer.
- Watch the clock: a Tribunal claim must be filed within 12 months of the CCC date, the expiry of the defect liability period or termination of the SPA (section 16N(2), Act 118), while in court LAD is a contract claim subject to the six-year limitation period under section 6(1)(a) of the Limitation Act 1953 (as law firm Azmi & Associates notes in its post-Obata-Ambak commentary). Do not sit on a claim.
One warning about handover day: waivers and "letters of undertaking" sometimes appear in the key-collection stack, worded as mutual settlements of all claims. Read every page before signing — signing away accrued LAD in exchange for keys you were already entitled to is a bad trade, and it is exactly what such documents are drafted to achieve. If you have already signed one, show it to a lawyer; its enforceability depends on its wording. The full delivery sequence is in our step-by-step new property guide.
Facts, statutory rates and reported case law — not legal advice. EOT disputes and waiver questions turn on your specific documents; for those, engage a housing lawyer. Act 118 and its schedules apply to Peninsular Malaysia; Sabah and Sarawak have separate housing ordinances.
Frequently asked questions
How much LAD do I get for a one-year delay on a RM500,000 unit?
RM50,000 — 10% per annum of the purchase price under the statutory SPA, which also happens to be the Tribunal's jurisdiction cap. Delays are counted daily: about RM137 per day at that price.
I already collected my keys. Can I still claim LAD?
Yes. LAD accrues from the missed deadline up to the date of valid vacant possession — collecting keys ends the accrual, it does not erase what accrued before. Claims filed after key collection are routine at the Tribunal. Mind the deadline - the Tribunal only takes claims filed within 12 months of the CCC date or the expiry of the defect liability period - and check whether anything you signed at handover purports to waive claims.
The developer offered free maintenance fees instead of cash LAD. Should I take it?
Only after doing the arithmetic. Compare the real value of the offer (months × monthly fee) against your computed LAD. On a RM500,000 unit six months late, LAD is about RM25,000 — a year of "free" maintenance fees rarely comes close.
Does LAD start from the SPA date or the booking fee date?
From the booking fee payment date, where a booking fee was collected before the SPA was signed — the Federal Court settled this in PJD Regency (2021). Keep that receipt.
Does this apply in Sabah and Sarawak?
Act 118 and Schedules G/H cover Peninsular Malaysia. Sabah and Sarawak housing developments fall under their own state ordinances with their own delivery and compensation terms — check which schedule your SPA actually follows.