Costly Lesson of the Unregistered Agent!
ARTICLELAND
Puvarasan Balaiyah
10/17/20252 min read
Hey there, property hustlers and future real estate moguls!Ever wondered what the quickest way is to turn a sweet commission into a bitter, expensive headache? Well, let me tell you the tale of poor Sajad Hussain and his run-in with the law in the case of Sajad Hussain v Crest Worldwide Resources Sdn Bhd. It’s a riot... but one that seriously stings!
The moral of the story, folks, is simple: Get Registered! It’s not just a fancy piece of paper; it’s your golden ticket to legally securing your hard-earned cash!
The Anatomy of a Void Agreement
Sajad, bless his ambitious heart, was hired to find buyers for some swanky apartments at "The Crest" in Kuala Lumpur. He did the work, found the buyers, and even got paid a whopping RM949,845 in commission. High five, right? WRONG.
Here's where the plot thickens and the comedy of errors begins: The vendor (Crest Worldwide) later claimed that Sajad wasn't a registered estate agent under the relevant Malaysian law (the Valuers, Appraisers, Estate Agents and Property Managers Act 1981).
The High Court, after ruling that an agreement did exist between the parties provided a temporary relief for Sajad but then..
Enter Section 24 of the Contracts Act 1950. This section is the ultimate buzzkill, declaring an agreement void if its object or consideration is forbidden by law or would defeat any law.
The Unlawful Agent Role (A.K.A. The Commission-Killer)
The Court found that Sajad, in promoting and marketing the properties, was clearly acting as an estate agent. Since he wasn't registered, it was unlawful for him to carry out that work and, crucially, to earn a commission for the sale.
The conclusion? The agreement's object and consideration were unlawful, making the entire contract void. The result? According to Section 66 of the Contracts Act 1950, when a contract is void, the person who received an advantage (Sajad, with his big commission) must restore it (pay it all back!).
That's right: nearly a million Ringgit, gone! Imagine having to write that check.
This case is a loud, thunderous, slightly-less-than-a-million-Ringgit warning . If you're going to act as an estate agent, you must be registered. Section 22C of the Valuers, Appraisers, Estate Agents and Property Managers Act 1981 explicitly states that an unregistered person is not entitled to recover in any court any fees, commissions, charges or remuneration for any professional advice or services rendered as an estate agent.
**This article is written based on the case of Sajad Hussain v Crest Worldwide Resources Sdn Bhd [2021] MLJU 1526 and in casual format to be understood by everyone.
**For assistance with dispute relating to property, kindly reach us.
Contributed by:
Puvarasan Balaiyah
Principal
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