Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor

[2022] 10 MLJ (Mohd Arief JC) 207

A Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor

HIGH COURT (KUALA LUMPUR) — WRIT SUMMONS

NO WA-22NCVC-778–11 OF 2018
B
MOHD ARIEF JC
4 APRIL 2022

Landlord and Tenant — Tenancy — Breach of agreement — Failure to pay

C rentals — Failure to return vacant possession — Whether there was breach of
tenancy agreement by defendants — Whether obligation to obtain approval from
state authority for the use of premises lay with plaintiff or defendants — Whether
obligation to make payment of rentals were conditional upon the obtainment of
approval to use premises from state authority — Whether defendants had validly
D terminated terms of tenancy — Whether defendants liable for full terms of tenancy
including renewed tenancy — Whether plaintiff entitled to terminate tenancy
when plaintiff elected not to accept earlier termination of tenancy by defendants
— Whether plaintiff entitled to claim full sums due under original tenancy period
and under renewed tenancies period — Whether second defendant liable as
E guarantor and under tenancy agreement — Contracts Act 1950 s 74

The plaintiff and a company known as Nirwana Academy Sdn Bhd (‘Nirwana’)
had entered into a tenancy agreement for the ground floor, mezzanine floor,
ninth floor, 22nd floor and 23rd floor (‘the premises’) of the plaintiff ’s building
F known as Plaza Pengkalan. Due to Nirwana’s failure to pay the rentals to the
plaintiff, the latter instituted proceedings which ended up with the winding up
of Nirwana. Subsequently, the plaintiff and the first defendant entered into a
tenancy agreement regarding the same premises which was secured by a
guarantee given by the second defendant. This new tenancy was for a period of
G 11 months with an automatic renewal of a further two consecutive terms of
three years and a final term of one year and the purpose of the tenancy was for
the defendants to run the Nirwana College. The dispute between the parties
started when the first defendant failed to pay the rentals and attempted to
wrongly terminate the tenancy for the ground floor, mezzanine floor and the
H ninth floor of the building. The plaintiff ’s action against the defendants for
summary judgment was unsuccessful as the court found several issues to be
tried. The plaintiff then terminated the tenancy agreement and demanded
vacant possession of the premises from the first defendant. Due to the breach of
the tenancy agreement by the defendants, the plaintiff filed the present action
I against the defendants and claimed for: (a) rentals for the period between May
2016 to May 2021 — RM7,700,720.80; (b) interest accrued as at 9 June 2021
— RM1,906,212.64; (c) sewerage charges from May 2016 to June 2021 —
RM233,514.48; (d) loss of rentals from 1 June 2021 to 15 April 2024 —
RM5,103,050.06; (e) the defendants to be directed to redeliver the vacant
208 Malayan Law Journal [2022] 10 MLJ

possession of the premises in their original condition and good tenantable A

repair within seven days from the date of judgment; (f ) alternatively, an order
that the plaintiff be at liberty to carry out the restoration work and the costs of
the same to be borne by the defendants subject to the said costs to be assessed
by the court; (g) costs of the proceedings; and (h) interest. The defendants’
defences against the plaintiff ’s action had raised the following issues: (i) whose B
obligation to apply for approval from Dewan Bandaraya Kuala Lumpur
(‘DBKL’); (ii) whether the rentals became due when Nirwana operated again or
whether it was part of the terms of settlement of the earlier dispute between the
plaintiff and Nirwana; (iii) whether the defendants had validly terminated the
terms of the tenancy via its notice dated 12 April 2017; (iv) whether the C
defendants were liable for the full term of the tenancies including the renewed
terms of the tenancy for the premises; (v) whether the plaintiff was entitled to
terminate the tenancy when the plaintiff did not accept the earlier termination
of the tenancy by the defendants — the doctrine of election; (vi) whether the
plaintiff was entitled to claim the full sums due under the original tenancy D
period and under the renewed tenancies period; (vii) the issue of vacant
possession; and (viii) the liability of the second defendant.

Held, allowing the plaintiff ’s claim:

E
(1) The first defendant had failed to pay the rentals and all sums due under
the terms of the tenancy agreement from its inception. Even the second
defendant admitted that the rentals had not been paid. Therefore, the
plaintiff had proven that the defendants did commit a breach of the
tenancy agreement (see paras 20, 25 & 28). F
(2) The court did not find that the statements made by the defendants’
witnesses were correct. The representations of the facts contradicted the
contemporary documents and were contrary to the terms of the tenancy
agreement. It was clear that under the terms of the tenancy agreement,
the obligation to obtain such approvals from any authorities for the use of G
the premises for the needs of the first defendant lay with the defendants
and not with the plaintiff (see paras 34 & 39).
(3) The contemporaneous documents indicated that the rentals were payable
irrespective of the status of the approval from DBKL or the status of H
Nirwana. The tenancy agreement did not provide for any condition
precedent to the obligation to pay the rentals from the defendants to the
plaintiff. This was merely an afterthought on the part of the defendants.
It was not the function of the court to rewrite the terms of the bargain as
recorded in the tenancy agreement (see paras 48 & 55). I
(4) The grounds relied on by the defendants did not justify the termination
of the tenancy for the ground floor, the mezzanine floor and the ninth
floor of the building. As the court had found earlier, the issue of the
continuation or resurrection of Nirwana was not supported by the
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 209

A contemporaneous documents and did not appear in the contract and the
obligation to obtain approval from DBKL lay with the defendants, and it
did not preclude the operation or payment of the rentals by the
defendants. Therefore, the plaintiff was entitled not to accept the
termination of the tenancy agreement by the first defendant. The court
B also found that the defendants did not deliver vacant possession of the
said three floors to the plaintiff despite the notice dated 12 April 2017.
Therefore, the said tenancies continued despite the aforesaid notice from
the first defendant (see paras 63–65 & 72).
C (5) As the court had found earlier, the defendants had failed to pay any of the
rentals due and all outgoings from the inception of the tenancy
agreement. The notice to terminate by the plaintiff was not dependent on
the election made by the plaintiff earlier. The right to terminate arose
independently because of the continued failure by the defendants to pay
D the rentals due. Therefore, the defendants’ argument on the inability of
the plaintiff to terminate on their reliance on the doctrine of election was
incorrect (see para 81).
(6) The court was of the opinion that section 9.05 read together with section
E 9.02 of the tenancy agreement rendered the right to decide whether to
terminate the automatic renewal of the tenancy lay with the plaintiff. The
parties did agree that the tenancy period shall be automatically renewed
at the end of the first period until 15 April 2017. This would then be
renewed for two consecutive terms of three years each and a final term of
F one year. The second tenancy period had since been terminated by the
plaintiff in accordance with section 9.02. The defendants had only
returned possession of the premises to the plaintiff on 8 October 2021
when the keys were returned to the plaintiff ’s solicitors. In the
circumstances, the defendants were required to pay rentals due to the
G plaintiff including all charges, which included but not limited to the
sewerage charges, from May 2016 to 8 October 2021. Further, based on
section 9.02(b), as the plaintiff did terminate the tenancy, the remaining
tenancy came to an end (see paras 87–88 & 90–92).
H (7) There was no clause in the tenancy agreement that entitled the plaintiff to
claim liquidated damages against the defendants, as such, the plaintiff
must prove its entitlement for such losses for the remainder of the
tenancy period under s 74 of the Contracts Act 1950. However, in the
circumstances of the case, the plaintiff was not entitled to claim for the
I full rentals after 8 October 2021 to May 2024 because the plaintiff had
failed to produce evidence of the loss of profits or the difference in the
rentals that it could now obtain based on current market rates compared
to those agreed by the defendants. After all, the premises had already in
the control of the plaintiff and if the court were to grant damages for the
210 Malayan Law Journal [2022] 10 MLJ

full rentals there was a danger that the plaintiff would be doubly A
compensated for the said premises (see paras 93–94 & 99).
(8) Section 7.32 of the tenancy agreement required that the first defendant
must surrender the premises rented in a state of good tenantable repair
and that the first defendant must restore the premises to its original B
condition if any alterations or additions were made. However, based on
the evidence, the defendants had refused to honour the first defendant’s
obligations under section 7.02. In the circumstances, the court found
that the plaintiff was entitled to an order allowing it to make such repairs
on behalf of the defendants and then claim the amount paid by the
C
plaintiff to rectify the premises and units to its original state. The plaintiff
would then be required to file the necessary assessment application to
determine the amount payable for the said rectification work (see
paras 102–105).
(9) As provided under the terms of the tenancy agreement, the liability of the D
second defendant must be preceded by a demand of the sums
outstanding to him. Save for the letter dated 3 October 2018, no other
demands were made against the second defendant. Under the
circumstances, the court was constrained to only grant damages to the
sum of RM4,596,510.40 as demanded in the letter dated 3 October E
2018 against the second defendant (see paras 110 & 112).

[Bahasa Malaysia summary

Plaintif dan sebuah syarikat yang dikenali sebagai Nirwana Academy Sdn Bhd
(‘Nirwana’) telah memeterai perjanjian penyewaan untuk tingkat bawah, F
tingkat mezanin, tingkat sembilan, tingkat 22 dan tingkat 23 (‘premis-premis
tersebut’) bangunan plaintif yang dikenali sebagai Plaza Pengkalan.
Disebabkan oleh kegagalan Nirwana untuk membayar sewa kepada plaintif,
plaintif telah memulakan prosiding yang berakhir dengan penggulungan
Nirwana. Selepas itu, plaintif dan defendan pertama menandatangani G
perjanjian penyewaan berhubung premis-premis yang sama yang dijamin
dengan jaminan yang diberikan oleh defendan kedua. Penyewaan baharu ini
adalah untuk tempoh 11 bulan dengan pembaharuan automatik selama dua
penggal berturut-turut selama tiga tahun dan penggal terakhir selama setahun
dan tujuan penyewaan adalah untuk defendan-defendan mengendalikan Kolej H
Nirwana. Pertikaian antara kedua-dua pihak bermula apabila defendan
pertama gagal membayar sewa dan cuba untuk menamatkan secara salah
penyewaan untuk tingkat bawah, tingkat mezanin dan tingkat sembilan
bangunan tersebut. Tindakan plaintif terhadap defendan-defendan untuk
penghakiman ringkas tidak berjaya kerana mahkamah mendapati beberapa isu I
untuk dibicarakan. Plaintif kemudiannya menamatkan perjanjian penyewaan
tersebut dan menuntut pemilikan kosong premis-premis tersebut daripada
defendan pertama. Disebabkan pelanggaran perjanjian penyewaan tersebut
oleh defendan-defendan, plaintif telah memfailkan tindakan semasa terhadap
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 211

A defendan-defendan dan menuntut: (a) sewa untuk tempoh antara Mei 2016
hingga Mei 2021 — RM7,700,720.80; (b) faedah terakru pada 9 Jun 2021 —
RM1,906,212.64; (c) caj pembetungan dari Mei 2016 hingga Jun 2021 —
RM233,514.48; (d) kehilangan sewa dari 1 Jun 2021 hingga 15 April 2024 —
RM5,103,050.06; (e) defendan diarahkan untuk menyerahkan semula
B pemilikan kosong premis-premis tersebut dalam keadaan asalnya dan dibaiki
dengan elok kepada keadaan asal dalam masa tujuh hari dari tarikh
penghakiman; (f ) sebagai alternatif, perintah supaya plaintif bebas untuk
menjalankan kerja pemulihan dan kos yang sama akan ditanggung oleh
defendan-defendan tertakluk kepada penilaian kos oleh mahkamah; (g) kos
C
prosiding; dan (h) faedah. Pembelaan defendan-defendan terhadap tindakan
plaintif telah menimbulkan isu-isu berikut: (i) siapa yang berkewajipan untuk
memohon kelulusan daripada Dewan Bandaraya Kuala Lumpur (‘DBKL’);
(ii) sama ada sewa tersebut perlu dibayar apabila Nirwana beroperasi semula
D atau sama ada ia adalah sebahagian daripada syarat penyelesaian pertikaian
terdahulu antara plaintif dan Nirwana; (iii) sama ada defendan-defendan telah
menamatkan secara sah terma-terma penyewaan melalui notisnya bertarikh
12 April 2017; (iv) sama ada defendan-defendan bertanggungjawab untuk
tempoh penuh penyewaan termasuk tempoh penyewaan yang diperbaharui
E untuk premis-premis tersebut; (v) sama ada plaintif berhak untuk
menamatkan penyewaan tersebut sedangkan plaintif tidak menerima
penamatan awal penyewaan oleh defendan-defendan — doktrin pemilihan;
(vi) sama ada plaintif berhak menuntut jumlah penuh yang perlu dibayar di
bawah tempoh penyewaan asal dan di bawah tempoh penyewaan yang
F diperbaharui; (vii) isu berkenaan pemilikan kosong; dan (viii) liabiliti
defendan kedua.

Diputuskan, membenarkan tuntutan plaintif:

(1) Defendan pertama telah gagal membayar sewa dan semua jumlah yang
G perlu dibayar di bawah terma-terma perjanjian penyewaan sejak dari
awal lagi. Malah defendan kedua mengakui bahawa sewa masih belum
dibayar. Oleh itu, plaintif telah membuktikan bahawa
defendan-defendan telah melakukan pelanggaran perjanjian penyewaan
tersebut (lihat perenggan 20, 25 & 28).
H
(2) Mahkamah tidak mendapati bahawa kenyataan yang dibuat oleh
saksi-saksi defendan adalah betul. Penyataan fakta yang dibuat
bercanggah dengan dokumen kontemporari dan bertentangan dengan
terma-terma perjanjian penyewaan. Adalah jelas bahawa di bawah
I terma-terma perjanjian penyewaan, kewajipan untuk mendapatkan
kelulusan sedemikian daripada mana-mana pihak berkuasa bagi
penggunaan premis untuk keperluan defendan pertama terletak pada
defendan-defendan dan bukan pada plaintif (lihat perenggan 34 & 39).
(3) Dokumen kontemporari menunjukkan bahawa sewa perlu dibayar tanpa
212 Malayan Law Journal [2022] 10 MLJ

mengira status kelulusan daripada DBKL atau status Nirwana. Perjanjian A

penyewaan tersebut tidak memperuntukkan apa-apa syarat terdahulu
kepada kewajipan membayar sewa daripada defendan-defendan kepada
plaintif. Ini hanyalah pemikiran terkemudian di pihak
defendan-defendan. Bukan fungsi mahkamah untuk menulis semula
syarat-syarat tawar-menawar seperti yang direkodkan dalam perjanjian B
penyewaan tersebut (lihat perenggan 48 & 55).
(4) Alasan yang disandarkan oleh defendan-defendan tidak mewajarkan
penamatan penyewaan untuk tingkat bawah, tingkat mezanin dan
tingkat sembilan bangunan tersebut. Seperti yang didapati oleh C
mahkamah sebelum ini, isu-isu penerusan atau kebangkitan Nirwana
tidak disokong oleh dokumen kontemporari dan tidak terdapat dalam
kontrak dan kewajipan untuk mendapatkan kelulusan daripada DBKL
terletak pada defendan-defendan, dan ia tidak menghalang operasi atau
pembayaran sewaan oleh defendan-defendan. Oleh itu, plaintif berhak D
untuk tidak menerima penamatan perjanjian penyewaan oleh defendan
pertama. Mahkamah juga mendapati bahawa defendan-defendan tidak
menyerahkan milikan kosong bagi ketiga-tiga tingkat tersebut kepada
plaintif walaupun notis bertarikh 12 April 2017 telah diberikan. Oleh
itu, penyewaan tersebut telah diteruskan tanpa mengira notis daripada E
defendan pertama (lihat perenggan 63–65 & 72).
(5) Seperti yang telah didapati oleh mahkamah sebelum ini,
defendan-defendan telah gagal membayar mana-mana sewa yang perlu
dibayar dan semua perbelanjaan dari permulaan perjanjian penyewaan F
lagi. Notis penamatan oleh plaintif tidak bergantung kepada pemilihan
yang dibuat oleh plaintif sebelum ini. Hak penamatan tersebut timbul
secara bebas disebabkan oleh kegagalan berterusan defendan-defendan
untuk membayar sewa yang perlu dibayar. Oleh itu, hujah
defendan-defendan mengenai ketidakupayaan plaintif untuk G
menamatkan sewaan berdasarkan pergantungan mereka pada doktrin
pemilihan adalah tidak betul (lihat perenggan 81).
(6) Mahkamah berpendapat bahawa seksyen 9.05 dibaca bersama seksyen
9.02 perjanjian penyewaan tersebut memberikan hak kepada plaintif
untuk memutuskan sama ada untuk menamatkan pembaharuan H
automatik penyewaan tersebut. Pihak-pihak bersetuju bahawa tempoh
penyewaan akan diperbaharui secara automatik pada penghujung
tempoh pertama sehingga 15 April 2017. Ini kemudiannya akan
diperbaharui untuk dua penggal berturut-turut selama tiga tahun setiap
satu dan penggal terakhir selama satu tahun. Tempoh penyewaan kedua I
kemudiannya telah ditamatkan oleh plaintif mengikut seksyen 9.02.
Defendan-defendan hanya memulangkan pemilikan premis tersebut
kepada plaintif pada 8 Oktober 2021 apabila kunci dikembalikan kepada
peguamcara plaintif. Dalam keadaan tersebut, defendan-defendan
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 213

A dikehendaki membayar sewa yang terhutang kepada plaintif

merangkumi semua caj, termasuk tetapi tidak terhad kepada caj
pembetungan, dari Mei 2016 hingga 8 Oktober 2021. Selanjutnya,
berdasarkan seksyen 9.02(b), memandangkan plaintif telah menamatkan
penyewaan, baki tempoh penyewaan telah tamat (lihat perenggan 87–88
B & 90–92).
(7) Tiada klausa dalam perjanjian penyewaan tersebut yang melayakkan
plaintif menuntut ganti rugi tertentu dan ditetapkan terhadap
defendan-defendan, oleh itu, plaintif mesti membuktikan kelayakannya
C untuk menerima ganti rugi tersebut untuk baki tempoh penyewaan di
bawah s 74 Akta Kontrak 1950. Walau bagaimanapun, dalam keadaan
kes, plaintif tidak berhak untuk menuntut sewa penuh selepas 8 Oktober
2021 hingga Mei 2024 kerana plaintif telah gagal untuk mengemukakan
keterangan berkenaan kehilangan keuntungan atau perbezaan dalam
D sewa yang boleh diperolehnya sekarang berdasarkan kadar pasaran
semasa berbanding yang dipersetujui oleh defendan-defendan. Lagipun,
premis tersebut telah pun berada dalam kawalan plaintif dan jika
mahkamah memberikan ganti rugi untuk sewa penuh terdapat bahaya
bahawa plaintif akan diberi pampasan dua kali ganda untuk
E premis-premis tersebut (lihat perenggan 93–94 & 99).
(8) Seksyen 7.32 perjanjian penyewaan tersebut menghendaki defendan
pertama mesti menyerahkan premis yang disewa dalam keadaan baik
pulih yang boleh disewakan dan defendan pertama mesti memulihkan
F premis tersebut kepada keadaan asalnya jika terdapat apa-apa perubahan
atau penambahan dibuat. Bagaimanapun, berdasarkan keterangan,
defendan-defendan telah enggan untuk mematuhi kewajipan defendan
pertama di bawah seksyen 7.02. Dalam keadaan tersebut, mahkamah
mendapati bahawa plaintif berhak untuk mendapat perintah yang
G membenarkannya membuat apa-apa pembaikan bagi pihak
defendan-defendan dan kemudian menuntut jumlah yang dibayar oleh
plaintif untuk membetulkan premis-premis dan unit-unit tersebut
kepada keadaan asal. Plaintif kemudiannya dikehendaki memfailkan
permohonan penilaian yang diperlukan untuk menentukan jumlah yang
H perlu dibayar untuk kerja pembaikan tersebut (lihat
perenggan 102–105).
(9) Seperti yang diperuntukkan di bawah terma-terma perjanjian
penyewaan tersebut, liabiliti ke atas defendan kedua mesti didahului
dengan tuntutan jumlah yang tertunggak kepadanya. Selain daripada
I surat bertarikh 3 Oktober 2018, tiada tuntutan lain dibuat terhadap
defendan kedua. Di bawah keadaan tersebut, mahkamah terkekang
untuk hanya memberikan ganti rugi bagi jumlah RM4,596,510.40
seperti yang dituntut dalam surat bertarikh 3 Oktober 2018 terhadap
defendan kedua (lihat perenggan 110 & 112).]
214 Malayan Law Journal [2022] 10 MLJ

Cases referred to A
Armagas Ltd v Mundogas (The Ocean Frost) [1985] 1 Lloyd’s Rep 1, HL (refd)
Bank Islam Malaysia Bhd v Lim Kok Hoe & Anor and other appeals [2009]
6 MLJ 839; [2009] 6 CLJ 22, CA (refd)
Berjaya Times Squares Sdn Bhd (formerly known as Berjaya Ditan Sdn Bhd) v M
Concept Sdn Bhd [2010] 1 MLJ 597; [2010] 1 CLJ 269, FC (refd) B
Cahaya Berlian Sdn Bhd v Bandar Kuala Lumpur [2021] 1 LNS 839, CA (refd)
Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] 2 MLJ 441; [2015]
2 CLJ 453, FC (refd)
Gestmin SGPS SA v Credit Suisse (UK) Ltd and another [2013] EWHC 3560
(Comm), QBD (folld) C
Koperasi Kastam Diraja Malaysia Bhd v Yi Go Group Sdn Bhd [2021] 5 MLJ
590; [2021] 10 CLJ 31, CA (refd)
Lee Soh Hua v Kow Lup Piow & Ors [1984] 2 MLJ 101; [1984] 1 CLJ Rep 191,
FC (refd)
Mintye Properties Sdn Bhd v Yayasan Melaka [2006] 6 MLJ 420; [2006] 4 CLJ D
267, CA (refd)
Mumtaz Properties Ltd; Wetton (as liquidator of Mumtaz Properties Ltd) v Ahmed
and others, Re [2011] EWCA Civ 610, CA (refd)
Simetra Global Assets Ltd and another company v Ikon Finance Ltd and others
[2019] EWCA Civ 1413, CA (refd) E
Wong Yee Boon v Gainvest Builders (M) Sdn Bhd [2020] 3 MLJ 571; [2020]
2 CLJ 727, FC (refd)

Legislation referred to
Contracts Act 1950 s 74 F
Evidence Act 1950 ss 91, 92
Tharminder Singh (with Melissa Jacob Thomas) (Izral Partnership) for the
plaintiff.
Rajenthira Kumar (with Hiu Yeat Fong) (Kumar & Assoc) for the defendants. G

Mohd Arief JC:

INTRODUCTION
H
Background facts

[1] The plaintiff is the landlord and the owner of the building known as
Plaza Pengkalan located at Batu 3, Jalan Ipoh, 51100 Kuala Lumpur.
I
[2] The plaintiff and a company known as Nirwana Academy Sdn Bhd had
entered into a tenancy agreement dated 27 February 2014 regarding the
ground floor, mezzanine floor, ninth, 22nd, and 23rd floor of the Plaza
Pengkalan.
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 215

A [3] The above-referred tenancy was for a period of three years from 16 April
2014 to 15 April 2017.

Th plaintiff ’s claim against the defendants

B [4] However, Nirwana Academy Sdn Bhd (‘Nirwana Academy’) failed to

pay the rentals due to the plaintiff and caused the plaintiff to institute
proceedings against the said company. Nirwana Academy was wound up on the
application of by the plaintiff as seen in the order dated 2 February 2016 by
Noorin bt Badaruddin J in the Companies (Winding-Up) Petition
C
No 28NCC-650–08 of 2015.

[5] Thereafter, a new tenancy agreement was entered between the plaintiff
and the first defendant. The said tenancy agreement was also secured by a
D guarantee given by the second defendant.

[6] This new tenancy was for a period of 11 months beginning from 1 May
2016 to 15 April 2017 with an automatic renewal of a further two consecutive
terms of three years each and a final term of one year. The new tenancy was also
E for the same premises that were originally rented to Nirwana Academy.

[7] The plaintiff alleges that the defendants did not pay the rentals and all
sums due to it under the terms of the above-referred tenancy from its inception
till to date despite reminders and monthly statements have been issued to the
F
first defendant.

[8] The plaintiff further alleges that the first defendant had attempted to
wrongly terminate the tenancy by issuing the letter dated 12 April 2017, the
G first defendant had attempted to terminate the tenancy for the ground floor,
mezzanine floor and the ninth floor but chose to retain the tenancy for the
22nd and 23rd floor. The plaintiff has since rejected the said termination by
letter dated 14 June 2017.

H [9] The plaintiff through its solicitors did issue a letter of demand dated
3 October 2018 demanding that the defendants pay to the plaintiff the sum of
RM4,596,510.20 being the outstanding rentals, sewerage charges, and interest
due pursuant to the terms of the above-referred tenancy agreement. The sum of
RM4,596,510.20 is allegedly due for the period between May 2016 to
I September 2018 from the first defendant to the plaintiff.

[10] The plaintiff had earlier attempted to obtain a summary judgment

against the defendants. This application was dismissed by this court as the
defendants have shown several issues that should be determined at trial.
216 Malayan Law Journal [2022] 10 MLJ

[11] Since then, the plaintiff chose to terminate the tenancy agreement as A
seen in the letter dated 28 April 2021 issued by its solicitors. The plaintiff has
also demanded that the first defendant redeliver vacant possession of the rented
premises in their original condition. The plaintiff further requires that the said
premises must be delivered in good and tenantable condition as required under
the terms of the tenancy agreement. B

[12] The plaintiff further contends that the defendants have since failed to
redeliver vacant possession of the premises in the manner prescribed by the
tenancy agreement. C

[13] The second defendant has since been adjudicated bankrupt. The
plaintiff has obtained leave from court to proceed with the claim against the
second defendant pursuant to the order dated 3 July 2019 in the Bankruptcy
Proceedings bearing number WA-29NCC-3520–08 of 2016. D

[14] Due to the breach of the tenancy agreement, the plaintiff claims the
following against the defendants:
(a) rentals for the period between May 2016 to May 2021 — E
RM7,700,720.80;
(b) interest accrued as at 9 June 2021 — RM1,906,212.64;
(c) sewerage charges from May 2016 to June 2021 — RM233,514.48;
(d) loss of rentals from 1 June 2021 to 15 April 2024 — RM5,103,050.06; F

(e) the defendants is directed to redeliver vacant possession of the premises

in their original condition and good tenantable repair within seven days
from the date of judgment;
G
(f) alternatively, an order that the plaintiff be at liberty to carry out the
restoration work and the costs of the same to be borne by the defendants
subject to the said costs to be assessed by this court;
(g) costs of this proceedings; and
H
(h) interest.

The defendants’ arguments — Defence presented

[15] The defendants defence is summarised as follows: I

(a) the tenancy entered by the defendants was forced upon them to ensure
that they were able to run Nirwana Academy Sdn Bhd and was part of
the settlement of the earlier dispute between the plaintiff and Nirwana
Academy Sdn Bhd (defence 1);
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 217

A (b) the obligation to pay the rentals under the current tenancy agreement
will only begin from the date on which the DBKL authorises the
defendants to operate its institute of higher education at the said
premises and the proposed amendments to the building plans relating to
the said units (defence 2);
B
(c) the first defendant had validly terminated the tenancy agreement for the
three floors on 12 April 2017 and it is wrong for the plaintiff to reject the
said termination (defence 3);
(d) it is inequitable for the plaintiff to claim for the rentals for the duration
C
of the whole tenancy as well as the renewed tenancy period under cl 9.05
of the tenancy agreement (defence 4);
(e) the plaintiff cannot now claim damages as it had elected earlier to
continue with the tenancy instead of termination (defence 5);
D
(f) the defendants could not deliver vacant possession of the premises as the
plaintiff did not allow them access to the premises (defence 6);
(g) the automatic renewal of the tenancy period should not be allowed or
approved by court as the defendants did breach the terms of the tenancy
E by failing to pay the rentals and sums due (defence 7); and
(h) the sums claimed for the three-tenancy period are unfair, inequitable,
and constitute a penalty instead of a genuine liquidated amount
(defence 8).
F
DECISION OF THIS COURT

[16] This matter was fixed for trial on 1 to 2 November 2021 and
2 December 2021. The following witnesses were called by the parties to give
G evidence and to present their version of events:
(a) plaintiff ’s witness SP1: Tee Yew Boon;
(b) plaintiff ’s witness SP2: Ar Dr Vadiveloo a/l S Chinnthamby;

H (c) defendant’s witness SD1: Dato’ Manimaran a/l Kanappram; and

(d) defendant’s witness SD2: Mr Thanabalan a/l Srimayan.

[17] After considering the written submissions, pleadings, documents, and

oral evidence presented to this court, I find that the plaintiff has proven its
I
claim against the defendants. I am of the opinion that the defendants have
failed to prove any of their defences raised in the amended defence dated
13 September 2021.
218 Malayan Law Journal [2022] 10 MLJ

[18] My reasons for allowing the plaintiff ’s claim and for refusing to accept A
the defence of the defendants are explained in the following paragraphs.

MY GROUNDS IN DETAIL — WHY I ALLOWED THE PLAINTIFF’S

CLAIM AGAINST THE DEFENDANTS
B
[19] I will deliberate on each of the defence raised by the defendants in the
following paragraphs.

The plaintiff has proven the breach of the tenancy agreement

C
[20] Firstly, I find that the plaintiff has proven that the defendants did
commit a breach of the tenancy agreement.

[21] As I have alluded earlier, parties did enter into a tenancy agreement after D
Nirwana Academy Sdn Bhd was wound up on the petition of the plaintiff.

[22] This new tenancy was undertaken after the representatives of the
plaintiff and the first defendant had attempted to resolve the dispute and the
amount outstanding to the plaintiff from Nirwana Academy Sdn Bhd. For the E
defendants, this settlement is essential to enable it to continue running the
institute of higher learning in the name of Nirwana Academy.

[23] I shall however not deliberate as to the merits of the issue concerning the
F
settlement of the dispute concerning the first tenancy between Nirwana
Academy and the plaintiff as that is within the purview of the High Court
hearing the pending claim of Niwarna Flexi Capital Venture Sdn Bhd v Swiss
Planner Sdn Bhd; Mutaya Sdn Bhd and Master Platform Sdn Bhd (Writ
No WA-22NCC-131–103 of 2021). G

[24] The material terms of the tenancy agreement between the plaintiff and
the defendants are as stated in annexure 1.

[25] I find that the defendants, in particular the first defendant, had failed to H
pay the rentals and all sums due under the terms of the tenancy agreement from
its inception.

[26] This is apparent in the invoices issued by the plaintiff to the first
defendant from 1 May 2016 to 1 April 2021, the statement of accounts issued I
from 1 March 2017 to 26 April 2021 and the letters of demand by the
plaintiff ’s solicitors dated 3 October 2018 issued to both the first and second
defendants.
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 219

A [27] Having agreed to pay the rentals for the premises and the other sums
due as provided in the tenancy agreement, it is for the defendants to pay the
said sums in accordance with the said agreement. I refer to sections 6.01, 7.01,
7.02, 7.03 and 7.05 as well as: (i) sections 4, 5, 6, 7 and 10 of the Second
Schedule; and (ii) the Third Schedule of the tenancy agreement.
B
[28] Even the second defendant, Manimaran a/l Kanappram admits that the
rentals have not been paid. This appears to the answer to question 26 of his
witness statement.
C
[29] I will now deal with the defences raised by the defendants.

Defences 1 and 2 — Whether the obligation to pay starts from the date when DBKL
grants the approval to operate or when the defendants could operate Nirwana
D College again

Whose obligation to apply for approval from DBKL

[30] The defendants contend that the rentals are only due from the date
E when DBKL grants its approval for the first defendant to operate its institute of
higher learning.

[31] To support the arguments put forward, the defendants refers to the
application filed by the first defendant through its architect, Ar Dr Vadiveloo
F
a/l Chinnathhamby to convert the basement, ground floor, mezzanine, 6, 16
and 17 of Plaza Pengkalan from its current approved use to be utilised for the
purpose of operating the said college.

G [32] Several documents were produced by the defendants to support this

defence:
(a) the application for approval by Ar Dr Vadiveloo a/l Chinnthhamby to
DBKL to convert the said floors that were endorsed by the plaintiff, as
owners of the building;
H
(b) the official receipt from DBKL for the sum of RM100 paid by the
above-referred architect;
(c) DBKL’s letter dated 18 October 2016 refusing to grant the approval to
I change the use of the basement and the hawker’s center on the sixth
floor. DBKL decided to maintain the current use of the said floors in
accordance with the plan approved by the local authority dated 12 April
1985;
220 Malayan Law Journal [2022] 10 MLJ

(d) DBKL’s second letter dated 19 October 2016 refused the application to A
change the use of the said floors as requested by the aforesaid architect
on behalf of his client;
(e) letter dated 24 November 2016 issued by the first defendant and the
email dated 17 November 2016 requesting for the amended plans as B
approved by DBKL from the plaintiff relating to the basement and the
sixth floor;
(f) email from the plaintiff dated 29 November 2016 to the first defendant
informing the first defendant that (a) they had liaised directly with the
C
aforementioned architect; (b) forwarded a copy of DBKL’s conversion
approval dated 22 April 1997; (c) informing the first defendant that
DBKL’s earlier approval did not include the basement and that this may
risk non-approval from DBKL; (d) there is no tenancy with regard to the
basement between the plaintiff and the defendants; and (e) seeking D
payment of the deposits from the first defendant. The plaintiff attached
a copy of the building plans as approved by DBKL dated 22 April 1997;
(g) email dated 31 March 2017 issued by Thana Sri Mayan on behalf of the
first defendant to the plaintiff seeking the latter to issue the letter drafted
by the first defendant on the letterhead of the plaintiff to DBKL. The E
draft letter is again seeking conversion approval of the floors at issue
from its original plan;
(h) the letter dated 31 March 2017 on the letterhead of the plaintiff to
DBKL seeking the approval of the said conversion; F
(i) DBKL’s letter dated 26 April 2017 to the plaintiff granting approval to
the said conversion and requesting that the building owner to execute an
amended approved plan in accordance with the terms of DBKL’s
consent; and G
(j) DBKL’s letter dated 18 May 2017 to the Ar Dr Vadiveloo granting
approval for the said conversion with conditions to be complied with.

[33] The defendants also relied on the evidence of the second defendant and
H
Thanabalan a/l Srimayan. I have considered the evidence presented by the
aforesaid witnesses:

Manimaran a/l Kanappam:

(a) it was the obligation of the plaintiff to obtain the consent or approval I
from DBKL to allow the use of the premises rented as centers of higher
education based on the application by Ar Dr Vadiveloo (the architect);
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 221

A (b) failure of the plaintiff to convert the said premises, including the
basement, did not allow the first defendant the ability to utilise the said
premises for its intended purpose;
(c) therefore, the first defendant did not have to pay the rentals due to the
plaintiff under the terms of the tenancy agreement; and
B
(d) see answers to questions 23, 24, 25, and 27 of Manimaran a/l
Kanappam.

Thanabalan a/l Srimayan:

C
(a) the first defendant could not utilise the premises as the requisite
approvals was not forthcoming;
(b) it was the plaintiff who had applied for the said approval through Ar Dr
Vadiveloo; and
D
(c) see answers to questions 13 and 14 of the Thanabalan’s witness
statement.

[34] However, having considered the evidence referred to at para 33 earlier,

E I do not find that the statements made by Thanabalan and Manimaran are
correct. The representations of the facts contradict the contemporary
documents and are contrary to the terms of the tenancy agreement.

[35] I refer to the often-quoted dicta of Robert Goff LJ in Armagas Ltd

F v Mundogas (The Ocean Frost) [1985] 1 Lloyd’s Rep 1 at p 57 where he stated:
Speaking from my own experience, I have found it essential in cases of fraud, when
considering the credibility of witnesses, always to test their veracity by reference to
the objective facts proved independently of their testimony, in particular by
reference to the documents in the case, and also to pay particular regard to their
G motives and to the overall probabilities. It is frequently very difficult to tell whether
a witness is telling the truth or not; and where there is a conflict of evidence such as
there was in the present case, reference to the objective facts and documents, to the
witnesses’ motives, and to the overall probabilities, can be of very great assistance to
a judge in ascertaining the truth. I have been driven to the conclusion that the judge
H did not pay sufficient regard to these matters in making his findings of fact in the
present case.

[36] Arden LJ (as she then was) in Re Mumtaz Properties Ltd; Wetton (as
liquidator of Mumtaz Properties Ltd) v Ahmed and others [2011] EWCA Civ
I 610, emphasised at para 14 of her judgment that:
… contemporaneous written documentation is of the very greatest importance in
assessing credibility. Moreover, it can be significant not only where it is present and
the oral evidence can then be checked against it. It can also be significant if written
documentation is absent. For instance, if the judge is satisfied that certain
222 Malayan Law Journal [2022] 10 MLJ

contemporaneous documentation is likely to have existed were the oral evidence A

correct, and that the party adducing oral evidence is responsible for its
non-production, then the documentation may be conspicuous by its absence and
the judge may be able to draw inferences from its absence.

[37] I am further guided by the decision of Leggatt J (as he then was) in B

Gestmin SGPS SA v Credit Suisse (UK) Ltd and another [2013] EWHC 3560
(Comm) where:
22. In the light of these considerations, the best approach for a judge to adopt in the
trial of a commercial case is, in my view, to place little if any reliance at all on witnesses’ C
recollections of what was said in meetings and conversations, and to base factual findings
on inferences drawn from the documentary evidence and known or probable facts. This
does not mean that oral testimony serves no useful purpose — though its utility is
often disproportionate to its length. But its value lies largely, as I see it, in the
opportunity which cross-examination affords to subject the documentary record to
D
critical scrutiny and to gauge the personality, motivations and working practices of
a witness, rather than in testimony of what the witness recalls of particular
conversations and events. Above all, it is important to avoid the fallacy of supposing
that, because a witness has confidence in his or her recollection and is honest,
evidence based on that recollection provides any reliable guide to the truth.
(Emphasis added.) E

[38] It is also worth quoting the judgment of Males LJ in Simetra Global

Assets Ltd and another company v Ikon Finance Ltd and others [2019] EWCA
Civ 1413 where he stated: F
… I would say something about the importance of contemporary documents as a
means of getting at the truth, not only of what was going on, but also as to the
motivation and state of mind of those concerned. That applies to documents
passing between the parties, but with even greater force to a party’s internal
documents including emails and instant messaging. Those tend to be the G
documents where a witness’s guard is down and their true thoughts are plain to see.
Indeed, it has become a commonplace of judgments in commercial cases where there is
often extensive disclosure to emphasise the importance of the contemporary documents.
Although this cannot be regarded as a rule of law, those documents are generally
regarded as far more reliable than the oral evidence of witnesses, still less their demeanour H
while giving evidence. The classic statement of Robert Goff LJ in The Ocean Frost
[1985] 1 Lloyd’s Rep 1 at p 57 is frequently, indeed routinely, cited …
…
It is therefore particularly important that, in a case where there are contemporary I
documents which appear on their face to provide cogent evidence contrary to the
conclusion which the judge proposes to reach, he should explain why they are not
to be taken at face value or are outweighed by other compelling considerations.
(Emphasis added.)
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 223

A [39] It is clear to me that under the terms of the tenancy agreement that the
obligation to obtain such approvals from any authorities for the use of the
premises for the needs of the first defendant lies with the said defendant and
not with the plaintiff. I refer to sections 2.02(a), 2.02(c), and 9.01 of the
tenancy agreement.
B
[40] I further note that the said witnesses did complain that the said tenancy
agreement was drafted by the solicitors for the plaintiff and allege that they
were forced to agree to the terms. They repeat that the defendants were not
given adequate opportunity to consider the terms and the conditions that
C appear in the said tenancy agreement. This theme appears in answers to
questions 7 and 8 of the witness statement of Thanabalan and answers to
questions 10–17 of the witness statement of Manimaran.

[41] The above testimony of the Manimaran and Thanabalan are contrary to
D
the terms of the agreement. I refer to s 9.17 of the tenancy agreement which
clearly indicates that the defendants had been given sufficient opportunity to
seek independent legal advice and that the terms of the agreement would be
binding on the defendants.
E
[42] I also find that the application for approval for the use of the relevant
premises was undertaken by the first defendant and not by the plaintiff. The
architect, Ar Dr Vadiveloo was appointed by the first defendant and not by the
plaintiff. The plaintiff had only assisted in the application to enable the
F defendants to operate the institute of higher learning at the premises rented.
This was explained by Ar Dr Vadiveloo in his evidence in chief which sustained
cross-examination by the learned counsel for the defendants.

[43] Another important factor that I have taken into account is that the said
G premises were originally rented to Nirwana Academy Sdn Bhd. The defendants
admit that they had attempted to settle the terms of the earlier dispute between
Nirwana Academy Sdn Bhd and that part of this settlement lead to the
execution of the tenancy agreement currently at issue.

H [44] If indeed the obligation was with the plaintiff to undertake the said
application for approval with DBKL then even at the time, as the approval was
not even forthcoming, the defendants should not have proceeded with the new
tenancy. Even as of the date of the winding up, after spending substantial sums
of monies, the required approvals were not forthcoming from DBKL.
I
[45] I chose to believe the evidence presented by the plaintiff ’s witnesses, Tee
Yew Boon and Ar Dr Vadiveloo to that of the defendants’ witnesses. I refer to
the answers to questions 35–47 and 53–67 of Tee Yew Boon’s witness statement
and from the notes of proceedings of the examination in chief and
224 Malayan Law Journal [2022] 10 MLJ

cross-examination of Ar Dr Vadiveloo. The evidence of Tee Yew Boon was A

unscathed by the substantial cross-examination by the defendants’ counsel and
his testimony is consistent with contemporaneous evidence on this issue.

Whether rentals become due when Nirwana Academy Sdn Bhd operates again
or whether it was part of the terms of settlement B

[46] I do not find that there is any credible evidence that indicates that
parties had agreed that the settlement agreement requires that the plaintiff is
required to ensure that the defendants were able to run Nirwana Academy Sdn
Bhd and that the defendants could utilise the premises as an institute of higher C
education. This condition did not appear in the said tenancy agreement. If
indeed this condition is important, then the defendants would have ensured
that it appears in the tenancy agreement. No such clause exists or appears in the
said agreement.
D
[47] Even if it was the second defendant’s intention that the tenancy
agreement was to enable him to reinvigorate Nirwana Academy, that remains
his unilateral intent and this did not appear in the tenancy agreement or any
correspondence between parties. As admitted by Mr Manimaran, he was E
desperate and wanted to reinvigorate the said company from the ashes of
winding up and agreed to the proposal by the plaintiff. There is no evidence
indicating that the plaintiff agreed to withhold rentals until such time the said
institution becomes operational again. The defendants’ contention is clearly
contrary to the terms of the tenancy agreement. F

[48] It is not the function of this court to rewrite the terms of the bargain as
recorded in the tenancy agreement.

[49] I refer to the decision of the Court of Appeal in Bank Islam Malaysia Bhd G
v Lim Kok Hoe & Anor and other appeals [2009] 6 MLJ 839; [2009] 6 CLJ 22
where Raus Sharif JCA (as he then was) stated:
It is trite law that the court should not rewrite the terms of the contract between the
parties that it deems to be fair or equitable. This principle has been clearly expressed
in numerous cases (see Shell Malaysia Trading Sdn Bhd v Lim Yee Teck & Ors [1982] H
2 MLJ 181; [1982] 1 LNS 11; Wong Pa Hock v American International
Assurance [2001] MLJU 688; [2002] 2 CLJ 267; M Paikan v YP Devathanjam
[1952] MLJ 58; [1952] 1 LNS 60 and Charter Reinsurance Co Ltd v Fagai [1996]
2 All ER 46).
I
[50] It is also trite law that ss 91 and 92 of the Evidence Act 1950 prohibit the
addition may be adduced to contradict, vary, add or substitute the terms of the
written instrument unless agreed upon between the parties. I refer to the
decision of the Federal Court in Lee Soh Hua v Kow Lup Piow & Ors [1984]
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 225

A 2 MLJ 101; [1984] 1 CLJ Rep 191.

[51] An objective test of the above-referred clause/sections under the tenancy

agreement indicates that the obligations lie not with the plaintiff but that of the
defendants. The defendants take the risk of renting out the said premises and
B even if they could not obtain the approvals from the requisite authorities, the
obligation to pay the rents and all sums outstanding to the plaintiff remains
binding on the defendants. The whole agreement does not indicate that such
an obligation lie with the plaintiff.
C
[52] I refer to Azahar Mohamed FCJ’s judgment (as he then was) in Wong Yee
Boon v Gainvest Builders (M) Sdn Bhd [2020] 3 MLJ 571; [2020] 2 CLJ 727
where he stated:
[8] As a starting point, it is important to bear in mind the basic principle of
D construction of contracts. The basic rule is that effect must be given to the intention
of the parties. This requires an objective test and not a subjective approach. It is an
objective approach which is required and a solution should be found which is both
reasonable and realistic (see Berjaya Times Square Sdn Bhd v M-Concept Sdn Bhd
[2010] 1 MLJ 592; [2010] 1 CLJ 269). The intention must be sought from the
E document itself. To ascertain the intention of the parties, the court reads the terms
of the contract as whole, giving the words used their natural and ordinary meaning.
We have explained this basic principle in the case of Lucy Wong Nyuk King & Anor
v Hwang Mee Hiong [2016] 3 MLJ 689; [2016] 4 CLJ 813; [2016] 3 AMR 101 as
follows:
F [34] … In this regard, the point which has a strong bearing on the matter is that
it is an established principle of construing a contract that, among others, a
contract must be construed as a whole, in order to ascertain the true meaning of
its several clauses, and also, so far as practicable, to give effect to every part of it.
Each clause in an ordinary commercial contract should be so interpreted as to
G bring them into harmony with the other clauses of the contract (see National
Coal Board v WM Neill & Son (St Helens) Ltd [1984] 1 All ER 555 which was
cited in Royal Selangor Golf Club v Anglo-Oriental (M) Sdn Bhd [1990] 2 MLJ
163; [1990] 3 CLJ Rep 37 and Mulpha Pacific Sdn Bhd v Paramount Corp Bhd
[2003] 4 MLJ 357). In Australian Broadcasting Commission v Australasian
H Performing Right Association Limited [1973] 129 CLR 99, it was held that the
whole of the contract has to be considered, since the meaning of any one part of
it may be revealed by other parts, and the words of every clause must if possible
be construed so as to render them all harmonious one with another.
[35] Professor McMeel in The Construction of Contracts (Interpretation, Implication
I and Rectification) (2nd Ed, 2011) explains in clear words this long-standing canon
of construction at para 1.73 as follows:
Both the traditional and the modern approaches to construction stress the
importance of having regard to the instrument as a whole. It is important not to
fixate on one particular word or phrase and thereby neglect the overall purpose
226 Malayan Law Journal [2022] 10 MLJ

of the document or to give disproportionate importance to one phrase or clause. A

This is a long-standing rule.
[36] As stated by Lewison in The Interpretation of Contracts (5th Ed) at para 7.02
that in order to arrive at the true interpretation of a document, a clause must not be
considered in isolation, but must be considered in the context of the whole of the
B
document. In Chamber Colliery Company Ltd v Twyerould (1893) [1915] 1 Ch 268
(note) (which was cited by Lewison), Lord Watson said:
I find nothing in this case to oust the application of the well known rule that a
deed ought to be read as a whole, in order to ascertain the true meaning of its
several clauses; and that the words of each clause should be so interpreted as to C
bring them into harmony with the other provisions of the deed, if that
interpretation does no violence to the meaning of which they are naturally
susceptible.

[53] I also refer to the letter issued by the first defendant to the plaintiff dated D
12 April 2017. In the said letter, the first defendant did state that they wanted
to terminate the ground, mezzanine and the ninth floor but chose to retain the
22nd and 23rd floor based on the rates as provided in the tenancy agreement.
The first defendant also wanted to utilise the basement to store their assets but
at a reduced rate. There was no mention of any obligation that the rentals will E
only be paid upon approval being obtained from DBKL.

[54] The response from the plaintiff clearly indicates that the rentals were
due and payable irrespective of the pending approval from DBKL. The plaintiff F
issued a letter dated 14 June 2017 refusing to accept the proposed termination
and at the same time informed the defendants that the rentals were outstanding
and the applicable interest that would be imposed on the defendants. There
was no rebuff from the defendants to indicate or state that these rentals are only
due once DBKL approves or when Nirwana is reinstated or reinvigorated. G

[55] In the circumstances, I find that contemporaneous documents indicate

that the rentals are payable irrespective of the status of the approval from
DBKL or the status of Nirwana. The tenancy agreement did not provide for
any condition precedent to the obligation to pay the rentals from the H
defendants to the plaintiff. I find that this is merely an afterthought on the part
of the defendants.

[56] Given the above and based on the documents referred above, I find that
the defendants have failed to prove the above defences. I reject the said defences I
and find on the said issues in favor of the plaintiff.

Defence 3 — Whether the defendants had validly terminated the terms of the
tenancy via its notice dated 12 April 2017
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 227

A [57] The next issue raised by the defendants concerns the termination of the
tenancy for the ground floor, mezzanine floor and ninth floor of Plaza
Pengkalan. The defendants refers to the letter issued by the first defendant to
the plaintiff dated 12 April 2017.
B [58] I have summarised the contents of the said letter, in the earlier
paragraphs, but I will reproduce the contents of the letter for convenience:
We wish to inform to you that we hereby terminating the Tenancy for the following
floor:
C …
However, we wish to retain 22nd and 23rd floor for renewal in the interim pending
approval from DBKL, based on the same rates as mention in the our previous
Tenancy.
D
[59] The witnesses for the defendants explained that the first defendant
decided to terminate the tenancy for the said floors on the grounds as stated in
the letter that: (i) Nirwana Academy Sdn Bhd, the holding company, was
wound up; (ii) the inability to obtain approval from DBKL; and (iii) that
E company has suffered substantial renovation costs which could not be utilised
or were under-utilised.

[60] Manimaran, the defendant’s first witness also stated that he wanted the
company to terminate the tenancies for the above referred floors on the ground
F
that the plaintiff had failed to obtain the approvals to convert the floors to be
used by the first defendant as a teaching center for its college of higher learning.
As I have said earlier, I do not agree that this obligation lies with the plaintiff,
and I do not agree that this is a pre-condition before the rentals become due and
G payable from the defendants.

[61] I will now deal with the issue of whether the notice to terminate by the
first defendant is valid and whether the plaintiff was wrong not to accept the
said termination.
H
[62] The plaintiff contends that the grounds given by the first defendant for
the said termination is not valid and that there exists a valid tenancy with an
automatic renewal in section 9.05(a) of the said tenancy agreement. I refer to
Tee Yew Boon’s answer to question 69 of his witness statement.
I
[63] I agree with the arguments raised by Tee Yew Boon as to the grounds for
the termination of the three floors by the first defendant. The grounds relied on
by the defendants do not justify the termination of the said tenancy for the
three floors.
228 Malayan Law Journal [2022] 10 MLJ

[64] As I have found earlier, the issue of the continuation or resurrection of A

Nirwana Education Sdn Bhd is not supported by contemporaneous
documents and does not appear in the contract. I have also dealt with the issue
of pending approval from DBKL. That obligation lies with the defendants, and
it does not preclude the operation or payment of the rentals due to the
defendants. This court cannot add or vary the terms of the written instrument B
as suggested by the defendants.

[65] Therefore, the defendants do not have any valid reason to terminate the
said tenancy agreement pertaining to the above referred floors.
C
[66] It is trite law that where an innocent party is faced with a breach of a
material term of the contract by their counterpart, it is open for the former to
either terminate the contract and seek damages or affirm the contract and seeks
its performance. D

[67] Gopal Sri Ram FCJ in Berjaya Times Squares Sdn Bhd (formerly known as
Berjaya Ditan Sdn Bhd) v M Concept Sdn Bhd [2010] 1 MLJ 597; [2010]
1 CLJ 269 held:
[11] At the heart of this appeal lies the question: what are the rights of an innocent E
party where there is a breach of contract? The question is one upon which there has
been much discussion for about 150 years and the cases decided during that period
of time have settled the applicable principles. See Philpot v Evans [1839] 151 ER
200, p 202 Ripley v M’Clure [1849] 154 ER 1245, p 1251. Nevertheless, cases do
arise from time to time that question these settled principles necessitating the courts F
to re-state them. This case presents us with such an opportunity.
[12] The starting point is to recognise that in an action for breach of contract it is the
court that determines who is the innocent party and who is the guilty party. That
problem does not arise in the present case because the appellant has freely admitted
throughout the proceedings that it is the party that is guilty of having breached the G
contract. The only issue that remains is whether — as held by the learned trial judge
— the respondent as the innocent party is entitled to rescind, the contract, that is to
say, to have the parties restored to a position where they will stand as if the contract
had never been made.
[13] The doctrine of repudiation is based on the proposition that where a promisor H
wrongfully repudiates a contract in its entirety, the promisee has a choice. He or she
may elect to accept the repudiation, treat the contract as at an end and sue for damages.
The rationale is that the primary obligation to perform the promise made is substituted
with a secondary obligation to compensate the promisee for the breach. See Moschi v Lep
Air Services Ltd [1973] AC 331. Alternatively, he or she may elect to reject the I
repudiation and treat the contract as subsisting. Whether the one or the other course was
adopted by the promisee — the innocent party — is a fact that is to be inferred by the
court from the objective facts, including the words and conduct of the parties. An election
once made is irreversible. See Sargent v ASL Developments Ltd [1974] 131 CLR 634,
p 655. But it is the essence of the doctrine of repudiation that the breach must go to
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 229

A the root of the contract. See Mayson v Clouet & Anor [1924] AC 980; Bowes v
Chaleyer [1923] 32 CLR 159; Hongkong Fir Shipping Co Ltd v Kawasaki Kisen
Kaisha [1962] 2 QB 26. In the absence of an express refusal to perform, the test is
whether the conduct of the contract-breaker is such that a reasonable person would
say of it that he has breached his promise in its entirety. See Freeth v Burr [1874] LR
B 9 CP 208; Rasiah Munusamy v Lim Tan & Sons Sdn Bhd [1985] 1 CLJ 541; [1985]
CLJ Rep 266.
[14] There is another way of stating the proposition. If a promisor does not perform
his promise in its entirety, the promisee may terminate the contract. This right of
termination was referred to by the common law lawyers of the 19th century as a
C right to rescind. So they wrongly described a broken contract as being voidable. This
was incorrect as the breach of a contract does not render it voidable.

[68] I also refer to Mintye Properties Sdn Bhd v Yayasan Melaka [2006] 6 MLJ
420; [2006] 4 CLJ 267 where Gopal Sri Ram JCA (as he then was) stated:
D
[8] To paraphrase in less eloquent language the words of Mohamed Azmi SCJ in
Rasiah Munusamy v Lim Tan & Sons Sdn Bhd [1985] 2 MLJ 291; [1985] 1 CLJ
541; [1985] CLJ Rep 266, there was an absolute refusal on the part of the
defendant to be bound by the original contract (Freeth v Burr [1874] LR 9 CP 208
E at p 214). And, in any event, the action of the defendant is to quote from the same
learned judge in that case — ‘such as to lead a reasonable person to conclude that he
no longer intends to be bound by its provisions’.
[9] But a breach is not an actionable breach unless it is accepted by the innocent
party to the contract — here the plaintiff. As Seah FJ observed in Ganam v Somoo
F Sinniah [1984] 2 MLJ 290; [1984] 2 CLJ 268; [1984] 1 CLJ Rep 123:
A wrongful repudiation by one party cannot, except by the election of the other
party, so to treat it, put an end to an obligation; if the other party still insists on
performance of the contract the repudiation is what is called brutum fulmen that
is, the parties are left with their rights and liabilities as before. A wrongful
G repudiation of a contract by one party does not of itself absolve the other party
if he sues on the contract from establishing his right to recover by proving
performance by him of conditions precedent (per Lord Wright in Edridge v
Sathna [1933] 60 IA 363).

H [10] So in the state of affairs in which the plaintiff found itself on 29 May 1996, it
had a choice: either to treat the contract as at an end or to elect to perform the new
contract. This is in accordance with s 40 of the Contracts Act 1950 which reads:
When a party to a contract has refused to perform, or disabled himself from
performing, his promise in its entirety, the promisee may put an end to the
I contract, unless he has signified, by words or conduct, his acquiescence in its
continuance.
It has been held that the section merely re-enacts English common law. See Sooltan
Chund v Schiller [1878] ILR 4 Cal 252; Choo Yin Loo v Visuvalingam Pillay [1930]
7 FMSLR 135.
230 Malayan Law Journal [2022] 10 MLJ

[11] For an election to be effective and binding, the innocent party must by words A
or conduct communicate his decision to the contract breaker. In other words it may
be express or implied from conduct. To quote Mason J (later CJ Australia) in Sargent
v ASL Developments Ltd [1974] 131 CLR 634 at p 655:
Essential to the making of an election is communication to the party affected by
words or conduct of the choice thereby made and it is accepted that once an B
election is made, it cannot be retracted (The Queen v Paulson [1921] 1 AC 271
at p 284; Tropical Traders Ltd v Goonan [1964] 111 CLR 41 at p 55). No doubt
this rule has been adopted in the interests of certainty and because it has been
thought to be fair as between the parties that the person affected is entitled to
know where he stands and that the person electing should not have the C
opportunity of changing his election and subjecting his adversary to different
obligations.
[12] Absent an express election, the test for deciding whether the innocent party
elected one way or the other is objective. Put another way, it is for the court to infer
from the surrounding circumstances of each case as to whether the innocent party D
elected to affirm in the continuance of the contract or to treat the contract as at an
end. So, if, for example, a buyer informs a seller that he will not accept the goods
sold and the seller nevertheless attempts delivery, this latter act may be held to be
conduct evincing an intention to affirm the contract because the seller is exercising
his rights under the contract. See ABB Distribution Sdn Bhd v GKM Development E
Development Sdn Bhd [1998] 7 MLJ 292; [1998] 1 CLJ 1053. However, ‘mere
inactivity after breach does not of itself amount to affirmation, nor (it seems) does
the commencement of an action claiming damages for breach’. See Chitty on
Contracts, (26th Ed) at para 1702, citing General Billposting Co Ltd v Atkinson
[1909] AC 118. See also Desa Teck Guan Koko Sdn Bhd v Sykt Huo Foh Hing [1994]
2 MLJ 246; [1994] 3 CLJ 172, per Ian Chin J. F

[13] To quote once again from Mason J in Sargent v ASL Developments Ltd:
If a party to a contract, aware of a breach going to the root of the contract, or of
other circumstances entitling him to terminate the contract, though unaware of
the existence of the right to terminate the contract, exercises rights under the G
contract, he must be held to have made a binding election to affirm. Such
conduct is justifiable only on the footing that an election has been made to affirm
the contract; the conduct is adverse to the other party and may therefore be
considered unequivocal in its effect. The justification for imputing to the
affirming party a binding election in these circumstances, though he be unaware
H
of his alternative right, is that, having a knowledge of the facts sufficient to alert
him to the possibility of the existence of his alternative right, he has acted
adversely to the other party and that, by so doing, he has induced the other party
to believe that performance of the contract is insisted upon. It is with these
considerations in mind that the law attributes to the party the making of a
choice, though he be ignorant of his alternative right. For reasons stated earlier, I
the affirming party cannot be permitted to change his position once he has
elected.

[69] The above propositions remain good law till to date as seen in the
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 231

A judgment of the Federal Court in Dream Property Sdn Bhd v Atlas Housing Sdn
Bhd [2015] 2 MLJ 441; [2015] 2 CLJ 453.

[70] Another important fact that I have taken into account is that the
defendants did not deliver vacant possession of the said floors to the plaintiff.
B If the defendant was adamant in terminating the tenancies for the ground,
mezzanine and ninth floors then they should have insisted that vacant
possession is given back to the plaintiff. This was confirmed by the Manimaran
a/l Kannappram when questioned by this court. He confirms that despite the
C
notice dated 12 April 2017, the keys to the units remain in the possession of the
first defendant and were not returned to the plaintiff.

[71] I have also taken into account, the defendants’ own conduct after
12 April 2017. There was no instruction given to their architect, Ar Dr
D Vadiveloo to stop the application for approval from DBKL. In fact, DBKL gave
its approval to the proposed changes as seen in the letter dated 18 May 2017
that was addressed to the said architect.

[72] Given the above, I find that the plaintiff is entitled not to accept the
E termination of the tenancy agreement by the first defendant. I also find that the
defendants did not deliver vacant possession of the said three floors to the
plaintiff despite the notice dated 12 April 2017. Therefore, the said tenancies
continued despite the aforesaid notice from the first defendant.
F Whether the defendants are liable for the full term of the tenancies including the
renewed terms of the tenancy for the premises

[73] The plaintiff had earlier applied to enter summary judgment against the
G defendants. This application was dismissed by this court as the defendants had
successfully shown a triable issue.

[74] Since then, the plaintiff decided to terminate the tenancy agreement by
its solicitor’s letter dated 28 April 2021. In the said letter, the plaintiff informed
H the defendants that:
(a) as of 26 April 2021, the sums of RM9,606,209.19 is due and payable by
the defendants to the plaintiff. This sum includes the rentals from May
2016 to April 2021 to the sum of RM7,566,261.49, interest as of
I 26 April 2021 to the sum of RM1,813,787.70, and sewerage charges of
RM226,160;
(b) the plaintiff has chosen to terminate the tenancy due to the default in
accordance with section 9.01(ii) of the tenancy agreement; and
232 Malayan Law Journal [2022] 10 MLJ

(c) the defendants are required to deliver vacant possession and to redeliver A
the premises to the original condition in accordance with section 7.32 of
the tenancy agreement.

[75] The plaintiff has since amended its statement of claim and sought the
following remedies from this court: B

(i) an order that the first and second defendants shall pay the plaintiff for
the said sum of RM7,700,720.80 being the outstanding rentals for the
period from May 2016 to May 2021;
C
(ii) an order that the first and/or second defendants shall pay the plaintiff
the said sum of RM1,906,212.64 being the interest accrued on the
outstanding rental calculated as at 9 June 2021 under the tenancy
agreement;
(iii) an order that the first and/or second defendants shall pay the plaintiff D
the said sum of RM233,514.48 being the sewerage charges for the
period from May 2016 to June 2021 (and continuing until redelivery of
the vacant possession of the demised premises in their original condition
and good and tenantable repair to the plaintiff );
E
(iv) an order that the first and/or second defendants shall pay the plaintiff
the said sum of RM5,103,050.06 being the loss of rental from 1 June
2021 until 15 April 2024 suffered by the plaintiff;
(v) an order that the first and/or second defendants shall redeliver vacant F
possession of the demised premises in their original condition and good
and tenantable repair to the plaintiff within seven days from the date of
the judgment;
(vi) in the event of default of the above paragraph, an order that the plaintiff
shall be at liberty to carry out the restoration works on behalf of the first G
and/or second defendants to restore the demised premises to their
original condition and good an tenable repair with the costs of such
restoration works to be assessed by a proper officer of this honourable
court, as and when arising, and paid by the first and second defendants
H
to the plaintiff;
(vii) an order that the first and/or second defendants to pay the plaintiff the
costs of this action and all other incidental costs arising thereby on a full
indemnity basis;
I
(viii) interest on the judgment sum in prayer (i) from 10 June 2021 until the
date of full realisation at the rate of 10%pa to be paid by the first and/or
second;
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 233

A (ix) interest on the judgment sum in prayer (ii) from the date of the
judgment until the date of full realisation at the rate of 5%pa to be paid
by the first and/or second defendant; and
(x) interest on the judgment sum in prayer (iii) from the date of the
B judgment until the date of full realisation at the rate of 10%pa to be paid
by the first and/or second defendant.

[76] As the plaintiff has amended its claim, I am of the opinion that the issue
of whether the defendants should be required to pay the full rentals up to its
C final date should be dealt together with the other defenses raised by the
defendants.

Defence 5 — Doctrine of election — Whether the plaintiff is entitled to terminate

the tenancy
D
[77] An interesting argument put forward by the defendants concerns the
doctrine of election. The defendants contends as the plaintiff did not accept the
earlier termination as stated in the letter dated 12 April 2017, it cannot now
terminate the tenancy and claim the damages that arose because of the
E
termination.

[78] This legal proposition is correct in law as seen in the judgment of Gopal
Sri Ram JCA (as he then was) in Berjaya Times Square Sdn Bhd v M Concept Sdn
F Bhd. It is worth repeating what His Lordship stated in that case:
Essential to the making of an election is communication to the party affected by
words or conduct of the choice thereby made and it is accepted that once an election
is made, it cannot be retracted (The Queen v Paulson [1921] 1 AC 271 at p 284;
Tropical Traders Ltd v Goonan [1964] 111 CLR 41 at p 55). No doubt this rule has
G been adopted in the interests of certainty and because it has been thought to be fair
as between the parties that the person affected is entitled to know where he stands
and that the person electing should not have the opportunity of changing his
election and subjecting his adversary to different obligations.

H [79] However, the application of the aforesaid legal proposition is

fact-sensitive. In this case, the plaintiff is not changing its position regarding
the earlier termination. To the plaintiff they continue to not accept the earlier
termination attempted by the first defendant as seen in the letter dated 12 April
2017.
I
[80] I find, based on the facts of this case, that the plaintiff ’s decision to
terminate as contained in its solicitor’s letter dated 28 April 2021 is valid and is
premised on the continued failure by the defendants, in particular the first
defendant, to pay the rentals and outstanding due to the plaintiff under the
234 Malayan Law Journal [2022] 10 MLJ

tenancy agreement. This right is enshrined in section 9.02(a)(iii) and section A

9.02(b) of the tenancy agreement. When the first defendant fails to pay the
rentals and all sums due to the plaintiff, the plaintiff is entitled to terminate the
said tenancy by issuing the appropriate notices in accordance to the aforesaid
clauses.
B
[81] As I have found earlier, the defendants have failed to pay any of the
rentals due and all outgoings from the inception of the tenancy agreement. The
notice to terminate in the solicitor’s letter 28 April 2021, is not dependent on
the election made by the plaintiff earlier. The right to terminate arose
independently because of the continued failure by the defendants to pay the C
rentals due. Therefore, I find that the defendants’ argument on the inability of
the plaintiff to terminate on their reliance on the doctrine of election is
incorrect and I reject the same.

Defences 4, 7 and 8 — The plaintiff cannot claim for the full sums due under the D
original tenancy period and under the renewed tenancies period

[82] The remaining issue raised by the defendants concerns the issue of
whether the plaintiff is entitled to claim the full damages sought as reproduced
in para 75. E

[83] The defendants’ argument revolves on the issue of whether: (i) the
plaintiff should not be allowed to consider the tenancy automatically renewed
in accordance with section 9.05 of the tenancy agreement; and (ii) that the F
plaintiff should have terminated the said agreement and reclaimed possession
at the end of the first or original tenancy period.

[84] The defendants also argue that the said damages sought are inequitable
and unfair as the plaintiff should have mitigated its damages by terminating the G
said tenancy and repossess the parcels from the first defendant.

[85] I will first deal with the issue of whether the said tenancy is renewed or
otherwise in accordance with section 9.05 of the tenancy agreement. Section
9.05 is reproduced in Annexure 1. H

[86] As I have alluded earlier, it is trite law that the terms of a contract must
be considered holistically and must be interpreted objectively. Each of its terms
must be considered to determine the meaning of the terms and conditions that
appear in the instrument. No terms or provisions appearing in the instrument I
should be read in a vacuum, they must be harmonised and read in context. This
is to ensure that no term be rendered superfluous or meaningless.

[87] After considering the above, I am of the opinion that section 9.05 read
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 235

A together with section 9.02 renders the right to decide whether to terminate the
automatic renewal of the tenancy lies with the plaintiff. Parties did agree that
the tenancy period shall be automatically renewed at the end of the first period
until 15 April 2017. This will then be renewed for two consecutive terms of
three years each and a final term of one year.
B
[88] The second tenancy period has since been terminated by the plaintiff in
accordance with section 9.02. I have considered the correspondence exchanged
between the plaintiff ’s solicitors and the defendants’ solicitors dated 28 April
2021, 7 May 2021, 5 August 2021, 13 September 2021, 17 September 2021,
C 22 September 2021, 29 September 2021, 30 September 2021, 1 October
2021, 8 October 2021 and 12 October 2021.

[89] I find that the keys to the said premises were only delivered back to the
plaintiff on 8 October 2021. The defendants did attempt to deliver the keys
D back on 4 October 2021 at the joint inspection of the premises but was rejected
by the plaintiff due to the condition of the premises. This was also recorded by
Thana Sri Mayan in his email dated 6 October 2021 to the plaintiff and the
defendants’ solicitors letter dated 8 October 2021.
E
[90] Therefore, the defendants had only returned possession of the premises
to the plaintiff on 8 October 2021 when the keys were returned back to the
plaintiff ’s solicitors.

F [91] In the circumstances, I find that the defendants are required to pay
rentals due to the plaintiff including all charges, which includes but not limited
to the sewerage charges, from May 2016 to 8 October 2021. The obligation of
the defendants to pay such sums remains until 8 October 2016 when the
plaintiff obtain the keys to the said premises back from the defendants.
G
[92] On the issue of the remaining tenancy period, I find as the plaintiff did
terminate the tenancy, in accordance with section 9.02(a)(iii) of the tenancy
agreement, the remaining tenancy period comes to an end. This is in
accordance with section 9.02(b) of the tenancy agreement. The right of the
H plaintiff to collect rentals and be paid the sums due to it continues until the
possession of the premises or property is given back to the plaintiff by the
defendants. As I have said earlier possession was given on 8 October 2021.

[93] I however do not find any clause in the tenancy agreement that entitles
I the plaintiff to claim liquidated damages against the defendants.

[94] Under such circumstances, the plaintiff must show to this court that it
is entitled to claim for such losses for the remainder of the tenancy period under
s 74 of the Contracts Act.
236 Malayan Law Journal [2022] 10 MLJ

[95] I refer to s 74 of the Contracts Act and the decision of the Court of A
Appeal in Cahaya Berlian Sdn Bhd v Bandar Kuala Lumpur [2021] 1 LNS 839,
where Nor Bee Ariffin JCA stated:
[25] Section 74 of the Contract Act 1950 governs the law on compensation for loss
or damage caused by breach of contract (Toeh Kee Keong v Tambun Mining Company B
Ltd [1968] 1 MLJ 39; [1967] 1 LNS 197; the Supreme Court case of Bank
Bumiputra Malaysia Bhd Kuala Terengganu v Mae Perkayuan Sdn Bhd & Ors [1993]
2 MLJ 76; [1993] 2 CLJ 495; Malaysian Rubber Development Corporation Berhad
v Glove Seal Sdn Bhd [1994] 3 MLJ 569; [1994] 4 CLJ 783; Nikmat Masyhur Sdn
Bhd v Kerajaan Negeri Johor Darul Ta’zim [2014] 1 MLJcon 213; [2008] 9 CLJ 46).
C
[26] In Malaysian Rubber Development Corporation Berhad, the Supreme Court held
that at p 790:
… It is important to bear in mind that the normal measure of damages for breach
of contract in this country is prescribed by s 74(1) of the Contracts Act 1950,
which is the statutory enunciation of Hadley v Baxendale [1854] 9 Exch 341; D
Toeh Kee Keong v Tambun Mining Company Ltd [1968] 1 MLJ 39; [1967] 1 LNS
197; Bank Bumiputra Malaysia Bhd Kuala Terengganu v Mae Perkayuan Sdn Bhd
& Anor [1993] 2 MLJ 76; [1993] 2 CLJ 495 (SC). In essence, the section states
that the party may recover any loss or damage for any breach which (a) naturally
arose in the usual course of things or (b) which the parties knew, when they made
the contract, to be likely to result from the breach of it. For the sake of E
completeness, it should be mentioned that our courts have treated the position
under the second limb of the section to be similar to the second limb of Hadley
v Baxendale, which is, the party may recover damages which may ‘reasonably be
supposed to have been in contemplation of both the parties, of the time they
made the contract …’. F
[27] In Nikmat Masyhur Sdn Bhd, Vernon Ong Lam Kiat JC (as he then was)
explained at p 54:
[7] In short, the common law rule in the assessment of damages consists of two
limbs. The first limb concerns damages flowing naturally, ie, in the normal G
course of things from the breach. The second limb concerns the damages that the
parties at the time of the making of the contract may reasonably be supposed to
have contemplated, as the probable result of the breach. This court is also
mindful that in the assessment of damages for breach of contract, the general rule
is that the aggrieved party be put in the same as if the contract had been
performed; so that normally he is entitled to recover from the contract breaker H
his loss of profits, or the benefit of the bargain, as it is often called (see Central
Malaysia Development Company Ltd v Chin Pak Chin [1967] 2 MLJ 174; [1967]
1 LNS 15.)
[28] It is elementary that the burden of proving damages or the loss claimed lies with I
the appellant (see Guan Soon Tin Mining Company v Wong Fook Kum [1969] 1 MLJ
99; [1968] 1 LNS 43; Tan Sri Khoo Teck Puat & Anor v Plenitude Holdings Sdn
Bhd [1994] 3 MLJ 777; [1995] 1 CLJ 15; Popular Industries Ltd v Eastern Garment
Manufacturing Sdn Bhd [1989] 3 MLJ 360; [1990] 2 CLJ Rep 635; [1990] 1 CLJ
133).
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 237

A [29] It must also be borne in mind that it is trite law that in event the appellant failed
to adduce sufficient evidence to sustain the appellant’s case on the appropriate
quantum, the appellant ought to be awarded nominal damages.

[96] I also refer to the recent decision of the Court of Appeal in Koperasi
B Kastam Diraja Malaysia Bhd v Yi Go Group Sdn Bhd [2021] 5 MLJ 590;
[2021] 10 CLJ 31.

[97] Lee Swee Seng JCA in that case held:

C [21] To begin with, there are no agreed liquidated damages clauses in the contract.
Even if there had been such a clause to the effect that the agreed damages shall be
based on the rentals for the unexpired period, that would not necessarily mean that
the plaintiff would succeed for the defendant would have the opportunity to adduce
evidence to show that such an award would be unreasonable in the circumstances of
the case in that it would be over and above the loss suffered by the plaintiff for the
D
defendant’s breach. See the Federal Court case of Cubic Electronics Sdn Bhd (in
liquidation) v MARS Telecommunications Sdn Bhd [2019] 6 MLJ 15; [2019] 2 CLJ
723 at paras 70 and 71.
[22] Here, there is evidence to show that the storage containers and the two
E machines had been removed by the plaintiff from the defendant’s premises in early
January 2018. See text message at p 51 of encl 3 affidavit in reply of Yap Yee Cheng,
a director of the plaintiff.
[23] Surely it would be overcompensating the plaintiff if damages is calculated
based on the whole five-year contract period at the agreed rate because the plaintiff
F now had the benefit of the ten used storage containers and the forklift and crane in
its possession which it could let out to others.
[24] The nature of the items let out appeared to be in high demand where the
plaintiff ’s stock is concerned for it was stated both for the containers and the
machine that the supply is subject to availability as can be seen in the first quotation
G and second quotation at pp 13 and 15 of encl 3.
[25] On top of that, the plaintiff in being granted the whole of the rentals for the
five-year period, would have the benefit of the whole of the contract sum payable
under the contract being paid upfront even before the expiry of the contract and just
after three months into the contract. That cannot be right and does not compute
H with the established principles of assessment of damages for a breach of contract.
[26] What we can say here, and we do so with the greatest of respect to the learned
High Court Judge, is that the assessment of damages based on the entire period of
the contract and the agreed rates had the contract been carried through to its
completion, would be far in excess of the loss suffered and thus inappropriate as
I there is no evidence led that the plaintiff could not let out the ten used storage
containers, the forklift and the crane after repossession from the defendant.
[27] The Federal Court in Cubic Electronics referred to the principle of
proportionality in assessing damages and though it was spoken of in the context of
a sum stated as agreed damages in the event of a breach, the proportionality
238 Malayan Law Journal [2022] 10 MLJ

principle would cut evenly across all claims for damages where to grant damages A
based on loss of revenue for the unexpired balance term of the contract would be
excessive and disproportionate to the actual loss that may be suffered. It
propounded as follows:
[68] Consequently, regardless of whether the damage is quantifiable or
otherwise, it is incumbent upon the court to adopt a common sense approach by B
taking into account the legitimate interest which an innocent party may have
and the proportionality of a damages clause in determining reasonable compensation.
This means that in a straightforward case, reasonable compensation can be
deduced by comparing the amount that would be payable on breach with the loss
that might be sustained if indeed the breach occurred. Thus, to derive reasonable C
compensation, there must not be a significant difference between the level of
damages spelt out in the contract and the level of loss or damage which is likely
to be suffered by the innocent party. (Emphasis added.)
[28] We are of the considered view that to allow damages based on the amount to be
D
collected for the entire term of the contract of five years would be disproportionate
and excessive. Instead of compensating the plaintiff for its loss, it would be causing
the plaintiff to profit from its loss which is not the principle in awarding damages
upon a breach of a contract.
E
[98] His Lordship went on to state:
[31] The first limb of s 74(1) of the Contracts Act 1950, deals with direct loss and
the second limb with indirect loss. Here we are concerned only with direct loss, for
it was not alleged that the plaintiff ’s loss falls within that which the parties knew,
when they made the contract, to be likely to result from the breach. F
[32] The Federal Court in Toeh Kee Keong v Tambun Mining Company Ltd [1966]
1 MLJ 39; [1967] 1 LNS 197 at p 40 (MLJ) expounded the s 74(1) of the Contracts
Act 1950 as follows:
The rule lays down the main principles as follows: G
Where two parties have made a contract which one of them has broken, the
damages which the other party ought to receive in respect of such breach of
contract should be such as may fairly and reasonably be considered as either
arising naturally, ie according to the usual course of things, from such breach of
contract itself, or such as may reasonably be supposed to have been in the H
contemplation of both parties, at the time they made the contract, as the
probable result of the breach of it.
In more compendious terms the rule has been restated by Asquith LJ in Victoria
Laundry (Windsor) Ltd Newman Industries Ltd [1949] 2 KB 528 539 in a passage
which I shall quote in full: I
(a) It is well settled that the governing purpose of damages is to put the
party whose rights have been violated in the same position, so far as
money can do so, as if his rights had been observed: (Sally Wertheim
Chicoutimi Pulp Co [1911] AC 301.) This purpose, if relentlessly
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 239

A pursued, would provide him with a complete indemnity for all loss
de facto resulting from a particular breach, however improbable,
however unpredictable. This, in contract at least, is recognised as too
harsh a rule. Hence,
(b) In cases of breach of contract the aggrieved party is only entitled to
B recover such part of the loss actually resulting as was at the time of
the contract reasonably foreseeable as liable to result from the
breach.
(c) What was at that time reasonably so foreseeable depends on the
C knowledge then possessed by the parties or, at all events, by the party
who later commits the breach.
(d) For this purpose, knowledge ‘possessed’ is of two kinds; one
imputed, the other actual. Everyone, as a reasonable person, is taken
to know the ‘ordinary course of things’ and consequently what loss is
D liable to result from a breach of contract in that ordinary course.
This is the subject matter of the ‘first rule’ in Hadley v Baxendale. But
to this knowledge, which a contract-breaker is assumed to possess
whether he actually possesses it or not, there may have to be added in
a particular case knowledge which he actually possesses, of special
circumstances outside the ‘ordinary course of things’, of such a kind
E
that a breach in those special circumstances would be liable to cause
more loss. Such a case attracts the operation of the ‘second rule’ so as
to make additional loss also recoverable.
(e) In order to make the contract-breaker liable under either rule it is
F not necessary that he should actually have asked himself what loss is
liable to result from a breach. As has often been pointed out, parties
at the time of contracting contemplate not the breach of the
contract, but its performance. It suffices that, if he had considered
the question, he would as a reasonable man have concluded that the
loss in question was liable to result (see certain observations of Lord
G du Parcq in the recent case of Monarch Steamship Co Ltd Karlshamns
Oljefabriker (A/B) [1949] AC 196).
(f) Nor, finally, to make a particular loss recoverable, need it be proved
that upon a given state of knowledge that defendant could, as a
reasonable man, foresee that a breach must necessarily result in that
H loss. It is enough if he could foresee it was likely so to result. It is
indeed enough, to borrow from the language of Lord du Parcq in the
same case, at p 158, if the loss (or some factor without which it
would not have occurred) is a ‘serious possibility’ or a ‘real danger’.
For short, we have used the word ‘liable’ to result. Possibly the
I colloquialism ‘on the cards’ indicates the shade of meaning with
some approach to accuracy.
[33] The burden of proof is on the party claiming damages. In Ban Chuan Trading
Co Sdn Bhd v Ng Bak Guan [2004] 1 MLJ 411; [2003] 4 CLJ 785, the Court of
Appeal reiterated as follows:
240 Malayan Law Journal [2022] 10 MLJ

The burden of proving the damages is always on the parties claiming the A
damages. In Tan Geok Khoon & Gerard Francis Robless v Paya Terubong Estate Sdn
Bhd [1988] 2 MLJ 672; [1987] 1 LNS 79 at p 680, Edgar Joseph Jr J (as he was
then) said:
This brings to my mind the famous words of Lord Goddard in Bonham-Carter v
B
Hyde Park Hotel (1948) 64 TLR 177:
Plaintiffs must understand that if they bring actions for damages it is for them to
prove their damage; it is not enough to write down the particulars and, so to
speak, throw them at the head of the court, saying: This is what I have lost, I ask
you to give me these damages’. They have to prove it. C
Thus, in Ashcroft v Curtin [1971] 1 WLR 1731, a plaintiff claiming for diminution
in the profits of his one man business could not succeed in this claim though the
evidence pointed to a decrease in profitability which ‘was due to the injury, the
records kept being too rudimentary and the accounts too unreliable to quantify the
loss’. D

[34] The compensation here is for the loss or damage which naturally arose in the
usual course of things from the breach. Under s 74(1) of the Contracts Act 1950 and
the first limb thereof, the plaintiff is allowed to claim for losses that arise naturally
from the breach. That would involve the loss arising from not being able to let out
E
the items repossessed to another customer or perhaps letting them out at a lower rate
or perhaps only being able to let out intermittently.
[35] Instead, the plaintiff here is claiming for the loss of revenue as general damages
for the revenue it would have grossed in if the contract has been allowed to operate
for its full five-year term. F
[36] The question is whether that is allowed in law in the circumstances of this case.
…
[42] This may include the costs incurred in advertising for letting these containers
and machines and the number of days that these items were left idling in the G
warehouse. In a case where the plaintiff had let these items out but at a lower price
than that quoted for and agreed to by the defendant, the plaintiff could produce
evidence of it and sue for the difference in the rates. However, there was no such
evidence.
[43] Even in cases where the containers and the machines are not let out at all H
because there was no demand for them at all, the plaintiff would only be able to
claim the loss of profit and not the loss of revenue from the rental, which it could
have obtained for as stated earlier, there is the costs element in all businesses,
whether it be fixed or variable costs or a combination of them.
I
[44] The ordinary meaning of profit is that one should deduct one’s costs from the
revenue to be collected. Here the plaintiff had not disclosed his costs which may well
include the costs of financing of the containers, the forklift, the crane, insurance and
maintenance. After all, the containers are used containers and not brand new ones
tailored to the defendant’s needs.
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 241

A [45] There is also the element of costs for operating the forklift and the crane
because the rental rates quoted include the plaintiff ’s appointed staff who alone can
operate the machine as stated in Appendix 1A under ‘general terms and conditions
of supply and service’ under ‘B Operator’ where is it stated: ‘Only Yi Go Group Sdn
Bhd appointed staff/operator can operate the equipment/machine’.
B …
[47] Time and again, this approach of claiming for the balance of the amount that
could be collected for the balance period of a contract for work to be done or rental
to be collected or a combination has come before our courts. The Court of Appeal
C in Lay Hong Food Corporation Sdn Bhd v Tiong Nam Logistics Solutions Sdn Bhd
[2018] 2 MLJ 66; [2017] 10 CLJ 680, when presented with such a claim, had this
to say:
[48] On another note, the basis of the claim by the plaintiff (TN Logistics) for
damages for loss of profits is based on an average of sales multiplied by six
D months. The plaintiff (TN Logistics) is relying on the average gross sum of the
invoice value. This cannot be an accurate figure as overhead costs such as petrol,
the costs of hiring of drivers, operation costs and maintenance has to be factored
in, to arrive at a net figure. Only then can a realistic profit figure be arrived at. To
allow such a manner of calculation as adduced by the plaintiff (TN Logistics)
would be to allow the plaintiff (TN Logistics) to claim for more than what it was
E entitled to, which is plainly wrong. The Federal Court in SPM Membrane Switch
Sdn Bhd v Kerajaan Negeri Selangor [2016] 1 MLJ 464; [2016] 1 CLJ 177 had
occasion to deal with this point when it held that:
However, we do not approve of the appellant’s method of calculation for
the loss of profits …This calculation does not reflect the principles of
F
compensation for loss of profits and will put the appellant in a position
well beyond that which it would rightfully be in, had the contract been
properly performed. A calculation based on ‘commissions’, that is to say
receipts, is very different from a calculation based on ‘profits’. To award
damages based on commissions would completely disregard the fact that had
G the contract been properly performed the appellant would have had to incur
expenses and costs of operation, among other things. The proper sum should
therefore be net of all the expenses that would be reasonable incurred in the
remaining 20 month period. To do otherwise would give the appellant
more than they would have obtained had the contract been performed,
H and therefore more than what they rightfully deserved. (Emphasis added.)
[48] The Federal Court in SPM Membrane Switch Sdn Bhd v Kerajaan Negeri
Selangor [2016] 1 MLJ 463; [2016] 1 CLJ 177 further explained the need to
determine the loss of profit for an unexpired term of a contract as follows:

I [119] This calculation (based on commission) does not reflect the principles of
compensation for loss of profits and will put the appellant in a position well
beyond that which it would rightfully be in, had the contract been properly
performed. A calculation based on ‘commissions’, that is to say receipts, is very
different from a calculation based on ‘profits’. To award damages based on
commissions would completely disregard the fact that had the contract been
242 Malayan Law Journal [2022] 10 MLJ

properly performed the appellant would have had to incur expenses and costs of A
operation, among other things. The proper sum should therefore be net of all the
expenses that would be reasonably incurred in the remaining 20 month period. To do
otherwise would give the appellant more than they would have obtained had the
contract been performed, and therefore more than what they rightfully deserved.
However, contrary to the respondent’s submission and the judgment of the trial B
judge, the mere fact that the formula was the appellant’s own formulation
(presumably in contradistinction with a formula provided for within the
contract) is not a ground for rejecting the formula. The agreement did not
stipulate a formula for calculating loss of profits, and as such the general
principles of the common law will apply and a formula that best estimates the
future loss of profits will be preferred by the court. (Emphasis added.) C

[49] The plaintiff had steered clear in not disclosing that and preferring to be put in
a position where the contract had not been breached. If that be the case then the
plaintiff should not have taken back possession of the containers and the machines
but just to sue based on the rental that it could have obtained but being able to get D
it in advance and before the expiry of the contract term for breach by the defendant.

[99] Similarly, in this case, I find that the plaintiff is not entitled to claim for
the loss of rentals for the remainder of the outstanding tenancy period. The
plaintiff should have produced evidence to indicate the difference or the loss of E
profits that it would have had if the tenancy agreement was brought to its
eventual fruition and the defendants had complied with the terms. The
plaintiff is not entitled to claim for the full rentals after 8 October 2021 to May
2024. It should have produced evidence of the loss of profits or the difference
in the rentals that it could now obtain based on current market rates compared F
to those agreed by the defendants. After all, the premises are now in the control
of the plaintiff and if this court were to grant damages for the full rentals there
is a danger that the plaintiff would be doubly compensated for the said
premises.
G
[100] Given the above, I agree with the defendants’ counsel arguments that
damages should not be granted for the full tenancy period. I limit it up to
8 October 2021 as the plaintiff has failed to show the loss of profits for the
remainder of the period of the renewed tenancy up to May 2024.
H
Defence 6 and the issue of vacant possession

[101] I also note that the plaintiff contends that the state of the premises
returned by the defendants is not to the standard expected under the terms of
the tenancy agreement. Section 9.01 of the tenancy agreement indicates the I
admission by the defendants that when the premises were given to the first
defendant, the units were in good order and satisfactory condition. This clause
also appeared in the earlier tenancy agreement entered between the plaintiff
and Nirwana Academy Sdn Bhd.
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 243

A [102] Section 7.32 of the tenancy agreement also requires that the first
defendant must surrender the premises rented in a state of good tenantable
repair and that the first defendant must restore the premises to its original
condition if any alterations or additions were made. I also note that
Manimaran a/l Kanappram admits that Nirwana Academy Sdn Bhd did
B undertake substantial alterations and renovation work to the said premises in
particular to the 22nd and 23rd floor of the building. The invoices issued by
Axisjaya Sdn Bhd and SY Design Sdn Bhd to Nirwana Academy Sdn Bhd were
also produced by the defendants.

C [103] The list of defects to the premises and unit rented were also produced in
the letter dated 12 October 2021 from the plaintiff ’s solicitors to the
defendants’ solicitors. The list of defects shows the damage to the premises and
to the units rented out by the defendants. Pictures of the defects were also
shown and produced to this court to show the extent of the damage done to the
D premises.

[104] I note that the defendants have refused to honor with the first
defendant’s obligations under section 7.32.
E
[105] In the circumstances, I find that the plaintiff is entitled to an order
allowing it to make such repairs on behalf of the defendants and then claim the
amount paid by the plaintiff to rectify the premises and units to its original
state. The plaintiff will then be required to file the necessary assessment
F application to determine the amount payable for the said rectification work to
be undertaken due to the default by the first defendants.

[106] On the issue of vacant possession, the defendants contend that they
were not given access to the premises. They refer to the email exchange between
G Thanabalan and the plaintiff to remove the items that were retained on the
22nd and 23rd floor.

[107] I find that those issues are now academic as the plaintiff has since
terminated the tenancy. The defendants have also released the premises back to
H the plaintiff. What remains are the rentals, outgoings and all such sums payable
to the plaintiff and the repairs that must be undertaken to the said units by the
defendants. These issues have been dealt with by me in the earlier paragraphs.

Liability of the second defendant

I
[108] I now turn to the issue of the liability of the second defendant. As the
first defendant did fail to comply with its obligations under the terms of the
tenancy agreement, the plaintiff is entitled to demand payment from the
second defendant in accordance with section 9.22 of the said agreement.
244 Malayan Law Journal [2022] 10 MLJ

[109] The second defendant agreed to pay on demand the sums outstanding A
from the first defendant, if the latter fails to comply with its legal obligations.
This is clearly provided in section 9.22 of the tenancy agreement that was also
executed by the second defendant.

[110] However, as provided under the terms of the tenancy agreement, the B
liability of the second defendant must be preceded by a demand of the sums
outstanding to him. Save for the letter dated 3 October 2018, no other
demands were made against the second defendant. The clause also makes it
clear that the sums due first defendant must be preceded by a demand to the
second defendant before it becomes due and payable by the second defendant. C

[111] I also note that in the subsequent demands issued by the plaintiff ’s
solicitors to the defendants’ solicitors, no demands were issued personally to
the second defendant in the capacity as guarantor and neither did this issue was
D
raised by the plaintiff ’s solicitors.

[112] Under those circumstances, I am constrained to only grant damages to

the sum of RM4,596,510.40 as demanded in the letter dated 3 October 2018
against the second defendant. E
ORDERS OF THIS COURT

[113] I find that the plaintiff has shown based on the statement of accounts
that the first defendant should be ordered to pay: F
(a) the sum of RM7,700,720.80 being the outstanding rentals for the
period up to 31 May 2021;
(b) the sum of RM573,593 being the outstanding rentals for the period
from 1 June 2021 to 8 October 2021; G
(c) the sum of RM1,906,212.64 being the interest accrued on the
outstanding rental calculated as at 9 June 2021 under the tenancy
agreement;
(d) the sum of RM233,514.48 being the sewerage charges for the period H
from May 2016 to June 2021;
(e) interest on the total judgment sum from the date of the judgment until
the date of full realisation at the rate of 5%pa to be paid by the first
defendant;
I
(f) I also make the order that the second defendant be ordered to pay the
plaintiff the sum of RM4,596,510.40;
(g) the defendants pay to the plaintiff costs of the proceedings to the sum of
RM50,000 subject to allocator; and
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 245

A (h) I further make the order that the plaintiff shall be at liberty to carry out
the restoration works on the premises rented out to restore the demised
premises to their original condition and good tenable repair with the
costs of such restoration works to be assessed by this court on an
application by the plaintiff, as and when arising, and paid by the first and
B second defendants to the plaintiff.

ANNEXURE 1
(i) Section 2.01
C DECLARATIONS
The parties hereto declare that;
(a) there exist no other agreement (s) which can, may or shall be capable of
amending, varying, cancelling, enlarging, restricting, annulling, waiving
D or altering any of the terms and conditions hereinbefore and hereinafter
contained or as a condition precedent or subsequent to this Agreement;
(b) the Schedules and Annexure annexed hereto shall constitute and form
integral part of this Agreement and shall be read together with this
E Agreement;
(c) no acts of the Landlord or its agents and/or servants, irrespective the
nature of the act, including acts or condonation, acquiescence, waiver,
extension, deferment, or novation shall be capable of converting,
varying altering, amending, enlarging, cancelling, annulling, restricting
F or waiving any of the terms and conditions herein set out and shall not
be capable of being or tantamount to an estoppel in law or in equity.
(ii) Section 2.02
The Tenant hereby declares that The Tenant has:-
G
(a) obtained and shall maintain at its own expense all the requisite
governmental approvals, permits, registrations, licenses and other
complements (including trade name) necessary to carry on the Tenant’s
Business and warrants that it has complied with all the requirements and
H impositions of the law and the appropriate authorities and if the Tenant
fails to obtain or maintain the licenses, permits or any other consents for
the operation of its business before, during or at any time of this
Tenancy, the Landlord will be at liberty to terminate the Tenancy and let
out the Demised Premises to other parties without further reference to
I the Tenant and in such case the Deposit shall be forfeited to the
Landlord in accordance with Section 5.04 (a) hereto ;
(b) sufficient and adequate insurance coverage with reputable insurance
companies covering all risks (including but not limited to the renovation
works to be conducted at the Demised Premises), inter alia, public
246 Malayan Law Journal [2022] 10 MLJ

liability, fire and any other claims in respect of any injuries caused to any A
visitors or invitees or persons lawfully present in the Demised Premises;
(c) agreed that The Tenant has inspected the Demised Premises and the
floor plan and is satisfied with the accuracy of the same and in assessing,
computing and measuring the area of the Demised Premises, the actual B
area comprising the Demised Premises measured to the external face of
walls enclosing the Demised Premises at floor level including toilets,
staircases and landings, lift well and lobbies, corridors, plant rooms,
cleaners’ room, cupboards, service core, floor space with headroom less
than 1.5 meters, columns, load bearing, and non-load bearing, C
partitions, and other structural constructions and assessment to
determine the area of the Demised Premises PROVIDED ALWAYS that
the Landlord may, at its sole discretion round-up to the nearest unit of
square feet or in the alternative to the nearest decimeter AND
FURTHER PROVIDED ALWAYS that upon and in the event of the D
issuance of the relevant strata titles, the area specified therein shall be
conclusive and binding on the parties hereto.
(iii) Section 4.01
AGREEMENT FOR TENANCY E
The Landlord hereby grants and the Tenant accepts a tenancy of the Demised
Premises together with the use and enjoyment in common with other persons
entitled thereto of the entrances, vestibules, staircases, landings, corridors ,
passage, lifts, water closets, lavatories and conveniences and other like
amenities (during such hours) as the same shall be in operation for a term stated F
in Section 2 (a) and (b) respectively of the Second Schedule hereto subject to
the terms and conditions hereinafter contained (‘the Term’).
(iv) Section 5.01
RENTALS AND REINSTATEMENT OF DEPOSIT G

The Tenant shall on or before the execution of this tenancy agreement pay the
Landlord the Rental Deposit and the Reinstatement Deposit as and by way of
deposit or security for the due performance and observance by the Tenant of all
and singular the several covenants conditions and agreements on the part of the H
Tenant contained herein.
(v) Section 6.01
RENTAL
The Rental for the Demised Premises shall be a sum more particularly I
stipulated in Section 4 of the Second Schedule hereto which monthly rental is
payable in advance, whether formally demanded or nor and without any
deduction or right of set-off whatsoever, the first of such monthly Rental shall
be made on or before the date more particularly stipulated in Section 6a of the
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 247

A Second Schedule hereto and thereafter on or before the date more particularly
stipulated in Section 6b of the Second Schedule hereto.
(vi) Section 6.02
The rental shall be paid by the Tenant to the Landlord or to the property
B managers appointed by the Landlord and as notified to the Tenant in writing.
The parties hereto agree that the said property managers shall be entitled to
communicate with the tenant and to collect the rentals from the Tenant and the
Landlord hereby agrees that a valid and authorised receipt issued by the said
property manager shall be sufficient discharge on behalf of the Landlord.
C
(vii) Section 7.01
PAYMENT OF RENTAL
The Tenant shall pay the reserved or any revised Rental and Deposit at times
D and in the manner aforesaid.
(viii) Section 7.03
PAYMENT OF INTEREST ON ARREARS OF OUTSTANDING
RENTAL AND SERVICE CHARGES
E
The tenant shall pay to the Landlord interest on arrears of outstanding Rental
and Service Charges (which in this context herein, means rental and service
charges not paid in accordance with Section 6.01 above) at a rate stipulated in
Section 7 of the Second Schedule hereto calculated from day to day from the
F date such amount becomes payable until the date of full payment PROVIDED
ALWAYS that such interest shall in no way prejudice the Landlord’s rights and
remedies specified in Section 9.02 (b) thereof.
(ix) Section 7.05

G PAYMENT FOR UTILITIES AND SEWERAGE CHARGES

(a) The Tenant shall pay to the Landlord or the appropriate authority all
charges for electricity and water as shown in the separate meter installed
in respect of the Demised Premises, telephone and telephone
installation charges and any other services supplied separately to the
H Demised Premises and charged against the Tenant.
(b) The Tenant shall pay to the Landlord within seven (7) days from the date
of receipt from the Landlord the sewerage charges payable to Indah
Water Konsortium Snd Bhd and or its successors in title a sum
I calculated in accordance with Section 10 of the Second Schedule and the
Tenant hereby agrees that the Landlord’s determination of such rate of
sewerage charges shall be final and binding on the Tenant.
(c) The Tenant shall upon vacating the Demised Premises is responsible for
payment of all utilities, sewerage charges and outgoings consumed at the
248 Malayan Law Journal [2022] 10 MLJ

Demised Premises and shall indemnify and keep the Landlord A

indemnified against any outstanding due and owing to the Landlord
and/or the relevant Appropriate Authority during the course of the
Tenancy.
(x) Section 7.08 B
STRUCTURAL OR MATERIAL ALTERATIONS
The Tenant shall not make or permit to be made any alterations or additions to
the Demised Premises or any of the Landlord’s fittings of fixtures (including
but not without limiting the generality of the foregoing any partitions and floor C
coverings) in the Building without first obtaining the written consent of the
Landlord. Should any damage be done by the Tenant its agents or servants to
the Demised Premises or any part thereof by the installation use or removal of
any equipment partition sign or other fittings to repair forthwith and make
good for such damage to the satisfaction of the Landlord at the Tenant’s own D
cost and expense.
The Tenant hereby agrees and undertakes to indemnify and keep the Landlord
indemnified at all times and from time to time for and against all claims
demands fines penalties suits proceedings liabilities costs and expenses losses
and damages suffered and or to be suffered by the Landlord arising from or in E
connection with the aforesaid renovation, alteration and or upgrading works.
(xi) Section 7.31
TO PERMIT INSPECTION PRIOR TO DETERMINATION OF
TENANCY F

At any time during the three (3) calendar months immediately preceding the
determination of the Term hereby granted to permit intending tenants and/or
others with written authority from the Landlord or its agents at all reasonable
times of the day and after reasonable notice has been given to enter and view the G
Demised Premises.
(xii) Section 7.32
ON DETERMINATION OF TENANCY
(a) On the determination of the tenancy, the Tenant shall quit and deliver H
vacant possession of the Demised Premises to the Landlord forthwith
and promptly together with all fixtures, fastenings, matters and things in
anyway attached to and belonging or appertaining hereto in such good
and tenantable repair as shall be in accordance with the covenants of the
tenant hereinbefore contained with and all locks and leys complete and I
if so requested by the Landlord to restore the Demised Premises to its
original condition if any alterations or additions have been made. Such
restoration to be carried out by the tenant at its own cost and expense
under the supervision of the Landlord’s Architect or other agent
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 249

A concerned. In the event of such restoration not being completed upon

determination of the tenancy the Landlord shall be at liberty to carry out
such restoration and the cost and expense thereto shall payable by the
tenant to the Landlord upon demand together with the rent for such
extra days taken for such restoration calculated proportionately based on
B the monthly rental hereinbefore reserved without prejudice to other
rights and remedies provided herein or available in law to the Landlord.
(b) The Landlord shall not be liable to repay the Tenant the cost and expense
incurred by the Tenant on any improvements made by the Tenant to or
C in the Demised Premises and the Tenant shall not be entitled to claim for
any reduction in the rent on account of such cost and expense incurred
by the Tenant.
(xiii) Section 7.33
D DOUBLE RENTAL
Without prejudice to Section 9.02 (b) hereof, if the Tenant holds over and
continues to occupy the Demised Premises beyond the expiration of the term
hereby created or the termination of this Agreement howsoever without the
E Landlord’s consent, or fails to remove the Tenant’s fixtures or to give up keys to
the Demised Premises, the Tenant shall without prejudice to the rights of the
Landlord in law under this Agreement pay to the Landlord a monthly sum
calculated at double the last prevailing rate of rental under this Agreement until
the Demised Premises is redelivered to the Landlord in the manner provided in
F this Agreement. For the avoidance of doubt, it is hereby understood that there
shall be no renewal of this Agreement by operation of law.
It shall be lawful for the Landlord to call in contractors to remove the fixtures
and partitions on the Tenant’s behalf and all costs of such work shall be debt
G due to the Landlord and recoverable by the Landlord by setting off the said
sums together with other changes for any defects and damage caused to the
Demised Premises against the Deposit referred to in Section 5.01, Section 5.02
and 5.03 hereto PROVIDED ALWAYS that this shall not to be deemed to be
a waiver of any of the Landlord’s rights whether herein contained or by law to
H recover any of the aforesaid sum and costs or balance thereof.
(xiv) Section 7.34
REMOVAL OF FURNITURE ETC
The tenant shall not in any time remove or permit to be removed any furniture
I or fittings from the Demised Premises (whether such furniture or fittings be the
property of the tenant or any other person) except with the prior written
permission of the Landlord, who shall be notified fourteen (14) days in advance
and the Tenant shall make good at its own costs any damage caused to the
Demised Premises or Building due to such removal.
250 Malayan Law Journal [2022] 10 MLJ

(xv) Section 9.01 A

POSESSION OF THE DEMISED PREMISES
(a) The acceptance of physical possession of the Demised Premises by the
Tenant shall be treated as conclusive evidence against the tenant that the
Demised Premises are in good order and satisfactory condition as on the B
date of such possession and as from the date of delivery of the Demised
Premises to the Tenant, the Demised Premises shall be at the sole risk of
the Tenant as regards to any losses or damages by fire or other
accident/perils whatsoever.
C
(b) The Landlord does not expressly or impliedly warrant that the Demised
Premises are now or will remain suitable or adequate for all or any of the
purpose of the Tenant and all warranties (if any) as to suitability and
adequacy of the Demised Premises implied by law are hereby expressly
negated. D
(xvi) Section 9.02
TERMINATION AND DISCHARGE
(a) This agreement and the rights conferred to the parties hereto by virtue of
this Agreement may be determined, discharged, terminated, cancelled, E
withdrawn or annulled in any one or more of the following events:-
(i) effluxion of time;
(ii) any sum(s) of money or part thereof due and payable under this
Agreement remains unpaid for a period of seven (7) days after the F
same have become due and payable (whether demanded or not);
(iii) the Tenant failing to observe or perform any of the terms and
conditions, stipulation and regulation of this Agreement on its part
herein contained; G
(iv) the Tenant, its agents and/or servants failing, neglecting, omitting,
refusing or inadvertently not observing or conforming to all the
rules and regulation laid down by the Landlord from time to time
with regard to the Building;
H
(v) a Receiving Order in bankruptcy being made against the Tenant;
(vi) the Tenant committing an act of bankruptcy, including, execution
of an assignment for the benefit of its creditors or executing a bill of
sale of its effects for the benefit of its creditors;
I
(vii) the Tenant’s goods and effects being attached in the course of an
execution of a judgment, or an attachment being threatened to be
levied or pursuant to an order for distress;
(viii) the Tenant allowing a judgment against it to be unsatisfied;
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 251

A (ix) a petition being presented to wind up the Tenant;

(x) the Tenant resolving being appointed for the Tenant by a creditor;
(xi) the Tenant or its agent(s) and/or servant(s) doing or committing
any act or thing which act or thing, in the sole opinion of the
B Landlord, may directly or indirectly prejudice the Landlord’s rights
and interests;
(xii) the Tenant or its agent(s) and/ or servant (s), permitted assign (s),
successors-in-title, engaging in any activity that the Landlord may
C regard as immoral, illegal or repugnant to the commonly held
beliefs of other tenants in the Building whether such beliefs are
based on social, religious or cultural grounds.
(b) In any one or more of the events set out in Section 9.02 (a) hereabove
D
happening, it shall be lawful for the Landlord, without prejudice to
other rights and remedies provided herein or available in law to the
Landlord, to forthwith re-enter upon and take possession of the
Demised Premises without further reference to the Tenant and the
Landlord shall further be entitled to seal off the entrance to the Demised
E Premises and/or stop all supply of water and electricity to the Demised
Premises and thereupon the tenancy created and granted herein to the
Tenant shall absolutely cease and determine save for the settlement and
adjustments accounts between the parties hereto and without prejudice
to the rights of action of the Landlord in respect of any antecedent
F breach of this Agreement or stipulation and regulations herein
contained and imposed on the Tenant.
(c) Acceptance of rent or any other payment by the Landlord shall not be
deemed to operate as a waiver by the Landlord of any right of action
against the Tenant in respect of any breach of any of its obligations
G hereunder.
(d) The Tenant hereby covenants that in the event that the Tenant intends to
terminate the tenancy hereby created before the effluxion of time, the
Tenant shall pay to the Landlord as agreed liquidated damages the rents
H for the unexpired term and upon payment by the Tenant. The Deposits
mentioned in Section 3 (a) and (b) of the Second Schedule herein shall
thereafter be dealt with in accordance with the provision of this
Agreement.
(xvii) Section 9.05
I
RENEWAL OF TENANCY
(a) The Tenant hereby requests and the Landlord hereby agrees that the Term as
defined in Section 4.01 hereof shall automatically be renewable or further
terms as stipulated in Section 8 of Second Schedule hereof from the expiration
252 Malayan Law Journal [2022] 10 MLJ

of the said Term without the Tenant having to give any notification whatsoever A
to the Landlord and the rental rate an the rental deposit shall upon such
renewal be revised in accordance with / to a rate as mentioned in Section 9 of
the Second Schedule hereof but otherwise containing the like covenants and
provisos as are herein contained with the exception of the present covenant for
renewal Provided at the expiry of the Term hereby created or at the time the B
new tenancy agreement is executed by both the parties hereto (if applicable)
there shall not be any existing breach or non-observance of any covenants on
the part of the Tenant herein contained.
(xviii) Section 9.13 C
NOTICE
Any notice or demand requiring to be served hereunder shall be in writing and
shall be sufficiently served on the Tenant and or the Guarantor(s) if delivered to
him/them/it or forwarded to him/them/it by prepaid registered post or left at D
his/their /its last known address and shall be sufficiently served on the Landlord
or its agents or forwarded to the Landlord or its agents by registered post. This
mode of service shall include service of any court documents and or documents
relating to legal proceedings. Any notice sent by registered post shall be deemed
to have been served at the time of posting the notice. E

(xix) Section 9.17

INDEPENDENT ADVICE
The Tenant and Guarantor and each every one of them hereby covenants and F
declares that the Tenant and the Guarantor have been advised by the Landlord
and seek independent legal advice of the effects and consequence to the Tenant
and the Guarantor and each and every one of them of signing this tenancy
agreement and the guarantee comprised herein shall be binding on the Tenant
and the Guarantor and each and every one of them regardless of whether the G
Tenant and or the Guarantor have resorted to any such advise.
(xx) Section 9.22
GUARANTEE AND INDEMNITY
(a) The Guarantor, in consideration of the Landlord agreeing upon his H
request to let the Demised Premises to the Tenant upon terms and
conditions contained herein, hereby covenant with and guarantee the
Landlord that the Tenant shall pay the rent and other monies hereby
reserved on the days and in the manner aforesaid and the Tenant shall
duly perform and observe all the covenants hereinbefore on the Tenant’s I
part contained and that the Guarantor will on demand pay, make good
to and indemnify the Landlord for and against all losses, damages costs
and expenses thereby arising or incurred by the Landlord PROVIDED
ALWAYS and it is hereby agreed that any neglect or forbearance of the
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 253

A Landlord in endeavoring to obtain payment of the rent and other

monies when the same become payable or to enforce performance or
observance of the several stipulation herein on the Tenant’s part
contained and any time which may be given by the Landlord to the
Tenant shall not release or exonerate or in any way affect the liability of
B the Guarantors under this covenant.
(b) Further to Section 9.22(a) hereof, the Guarantor shall accept from the
Landlord, if required to do so, a tenancy of the Demised Premises for a
term equal in duration to the residue then remaining unexpired at the
C time of the grant of such tenancy to the Guarantor which tenancy shall
contain the same Tenant’s covenants and the same provisions and
conditions in all respects (including the proviso for forfeiture) as are
contained in this tenancy on the happening of any of the events as set
out in Clause 9.02 hereinabove.
D
(xxi) The Second Schedule
(Which is to be taken, read and construed as an essential part of this
Agreement)
E
SECTION ITEM PARTICULARS
1 The term
1st May 2016 or the date of
a) Commencement
2 commencement of business by the Tenant,
F Date
whichever is earlier
b) Expiry Date 15th April 2017
3 The Deposit
Ringgit Malaysia Three Hundred
G Thirty-Nine Thousand Seven Hundred
a) Rental Deposit And Five And Sen Ninety
(RM339,705.90) only which is equivalent
to Three (3) months rental.
Ringgit Malaysia Twenty-Five Thousand
H b) Utilities Deposit
(RM25,000.00) only.
c) Letter Box Key
Ringgit Malaysia Fifty (RM50.00) only.
Deposit
Ringgit Malaysia One Hundred Thirteen
I c) Reinstatement Thousand Two Hundred And Thirty Five
Deposit Sen Thirty (RM113,235.30) only which is
equivalent to One (1) month rental.
Ground Floor
254 Malayan Law Journal [2022] 10 MLJ

Ringgit Malaysia Nineteen Thousand A

Three Hundred And Fifty Nine
(RM19,359.00) only per month payable
monthly in advance which is calculated at
Ringgit Malaysia (RM3.00) only per
square foot; B
Mezzanine Floor
Ringgit Malaysia Seventeen Thousand
Forty Seven and Sen Fifty (RM17,047.50)
only per month payable monthly in C
advance which is calculated at Ringgit
Malaysia Two and Sen Fifty (RM2.50)
only per square foot;
4 d) Rental 9th Floor
Ringgit Malaysia Twenty-Five Thousand D
Six Hundred And Nine and Sen Sixty
(RM25,609.60) only per month payable
monthly in advance which is calculated at
Ringgit Malaysia One and Sen Sixty
(RM1.60) only per square foot; E
22nd Floor
Ringgit Malaysia Twenty-Five Thousand
Six Hundred And Nine And Cents Sixty
(RM25,609.60) only per month payable
monthly in advance which is calculated at F
Ringgit Malaysia One and Sen Sixty
(RM1.60) only per square foot;
23rd Floor
Ringgit Malaysia Twenty-Five Thousand
Six Hundred And Nine and Cents G
Sixty(RM25,609.60) only per month
payable monthly in advance which is
calculated at Ringgit Malaysia One and
Sen Sixty (RM1.60) only per square foot;
Included in the respective Rental H
5 Service Charges stipulated in Section 4 of the Second
Schedule hereof
Manner of a. The first payment shall be made on or
6 payment of the before the execution of this Tenancy
I
monthly Rental Agreement and
b. Thereafter on or before the 7th day of
every succeeding month.
7 Interest Rate Ten Percent (10%) per annum
 Swiss Planner Sdn Bhd v Plush Dollar (M) Sdn Bhd & Anor
[2022] 10 MLJ (Mohd Arief JC) 255

A The term is renewable for further two (2)

consecutive terms of Three (3) years each
Duration of the
(hereinafter be referred to as ‘1st Renewal
8 renewed
Term’ and ‘2nd Renewal Term’
term(Section 9.05)
respectively and a final term of One (1)
B year (hereinafter) called ‘the Final term’.
The rent, deposit
and service charge
payable for the
9 Rental payable for the 1st Renewal Term
C renewed
term(Section 9.05
(a))
Ground Floor — Ringgit Malaysia Three
And Sen Twenty Four (RM3.24) per
D square foot per month
Mezzanine Floor — Ringgit Malaysia Two
And Sen Seventy (RM2.70) per square
foot permonth
9th, 22nd, and 23rd Floor — Ringgit
E
Malaysia OneAnd Sen Seventy (RM1.70)
per square foot per month
Rental payable for the 2nd Renewal Term
Ground Floor — Ringgit Malaysia Three
F And Sen Fifty Six (RM3.56) per square
foot per month
Mezzanine Floor — Ringgit Malaysia Two
And Sen Ninety Seven (RM2.97) per
square foot per month
G
9th, 22nd, and 23rd Floor — Ringgit
Malaysia One And Sen Seventy (RM1.70)
per square foot per month
Rental payable for the Final Term
H Ground Floor — Ringgit Malaysia Three
And Sen Ninety Nine (RM3.99) per
square foot per month
Mezzanine Floor — Ringgit Malaysia
Three And Sen Thirty Three (RM3.33)
I per square foot per month
9th, 22nd, and 23rd Floor — Ringgit
Malaysia Two And Sen Thirteen
(RM2.13) per square foot per month
256 Malayan Law Journal [2022] 10 MLJ

A rate calculated in such proportion as the A

area of the Demised Premises as stated
10 Sewerage Charges
herein bears to the total lettable area and
floor space of the Building.

Plaintiff ’s claim allowed. B

Reported by Dzulqarnain Ab Fatar