I have sent queries as follow ....

Dear Propsocial Legal,

What are the duties and responsibilities of a liquidator taking over a bankrupt developer?

What are the obligations of a liquidator to unit owners of an apartment?

What is the role of the liquidator in the process of getting the individual title of an apartment which is now under the master title?

What are charges owners need to pay the liquidator on individual title related matters?

Are these charges fixed or negotiable?

· What are the duties and responsibilities of a liquidator taking over a bankrupt developer?

The first and foremost duties of the liquidator are to accumulate and realise the assets of the insolvent company and run the affairs of the wound up company for the purposes of settling the debts of the secured or unsecured creditors and other stakeholders.

If the property has not been completed, the liquidator is not statutorily bound to rehabilitate abandoned project as after paying all the creditors, there may not be enough funds left to rehabilitate the project. In some instances, even if there are enough funds, the liquidators may not have the expertise to carry on such a project. Hence, the best they could do is to sell the project to other developers. In such instances, the purchasers have no choice but to enter into a new sale and purchase agreement with new developers if they wish to. Otherwise, the purchasers may just have to settle to claim for damages from the company liquidator.

· What are the obligations of a liquidator to unit owners of an apartment?

A liquidator will be subjected to the duties and responsibilities imposed by Housing Development (Control & Licensing) Act, 1966 (HDA). He will act as a ‘de facto’ housing developer and assume all the obligations of the developer to the purchasers.

· What is the role of the liquidator in the process of getting the individual title of an apartment which is now under the master title?

In the event if a developer undergoes liquidation before applying for strata title in the first place, a court-appointed liquidator is obligated to issue strata titles to unit owners of an apartment by opening a Book of Strata with the Land Office. The liquidator on behalf of the developer will inform the purchasers when the strata titles are out.

To get the strata titles, the purchaser will then appoint a lawyer to assist in the transfer of title from the developer’s name to the purchaser. The appointed lawyer will write to the liquidator for the necessary information and the liquidator is required to provide the said information.

· What are charges owners need to pay the liquidator on individual title related matters?

Are these charges fixed or negotiable?

HDA provides that a developer is only allowed to collect fees not exceeding RM50 for issuing a written confirmation. Hence, a liquidator should not be allowed to charge or impose any administrative fees above the cap set out in HDA when carrying out his duties since he is assuming the affairs and responsibility of the bankrupt developer.

Dear MyLEGAL ResponseMyLEGALResponse,

Thank you very much for your reply.