JUDGMENT

Introduction

[1] This appeal relates to the appellants'/defendants' use of their apartment units for commercial purposes by letting them out for short-term rental. The dispute arose when the respondent/plaintiff took issue with the appellants/ defendants using their respective premises for such purposes.

[2] The respondent/plaintiff is a management corporation incorporated under the Strata Titles Act 1985 ('the STA 1985') to maintain and manage a development known as "Verve Suits" ('Verve Suites') located at No 8, Jalan Kiara 5, Mont Kiara, 50480 Kuala Lumpur. Verve Suites was built on a plot of land held under GM 8661, Lot 67344, Mukim of Batu, District of Kuala Lumpur ('Land'). The category of land use is 'Building' with the express condition that the Land shall be used for commercial building with the purpose of service apartments and commercial only.

[3] The 1st appellant/1st defendant is a Swedish national and a tenant in Verve Suites. He owns 999,900 shares in the 2nd appellant/2nd defendant. The 3rd and the 4th appellants are the 8th and the 14th defendants respectively in the High Court. The other defendants are parcel owners in Verve Suites who leased out their units to the 2nd appellant/2nd defendant for short and long-term rentals. The other defendants either settled the suit at the High Court or chose not to appeal to this court. The 1st and 2nd appellants/1st and 2nd defendants, in addition to leasing some units, managed the enterprise either for some or all of the other defendants as they originally were in the High Court.

[4] For ease of reference, in this judgment, parties will be referred to as they were in the High Court.

The Background Facts

[5] On 18 November 2015, the Commissioner of Building Kuala Lumpur ('COBKL') issued COBKL Circular 2015/2016 ('Circular'), instructing all joint management bodies or management corporations to curb the prevailing issue of the use of buildings in and around Kuala Lumpur for short-term rental.