Exclusive jurisdiction clauses must be upheld unless exceptional circumstances are shown, emphasizing the burden of proof on the party challenging the clause.

Matter Before This Court

[1] This is a decision on two (2) appeals each brought by the Plaintiff in appeals No MA-12ANCC-1-01/2024 and MA-12ANCC-2-01/2024 against the decision of the Sessions Court under civil suit no: MA-B52-NCC-32-08/2023. Appeal case 1-01 is against the decision of the Sessions Court under encl 6 to stay all proceedings pending adjudication of the Plaintiff's claim in a foreign forum. Appeal 2-01 is against the decision of the Sessions Court under encl 8 to not hear the Plaintiff's application for summary judgment against the Defendant following the Sessions Court decision to grant the stay.

Background Facts

[2] The core contention in both these appeals centers around the effect of a provision in an agreement called Memorandum of Understanding dated 17 March 2023 entered into between the parties for the purchase and takeover of 50,000 metric tons of Ultra Low Sulphur Diesel EN590 ('MOU'). The Plaintiff is the purchaser whilst the seller is the Defendant. That provision in issue appears as cl 9 titled Applicable Law which provides that the MOU shall be interpreted in accordance with the law and in the event of any dispute incapable of amicable solution, the dispute shall be submitted to the International Chamber of Commerce London and the London High Court will make the final judgment.

[3] It is the Plaintiff's case that at the request of the Defendant the Plaintiff had paid to the Defendant the amount of USD150,000 as deposit for security guarantee payment for re-routing cost of the Product and the Plaintiff then took over title of the Product. In breach of the terms of the MOU the Defendant failed to deliver the Product to the Plaintiff. The Plaintiff demanded refund of the said sum and an amount of RM65,000.00 was paid by the Defendant leaving a balance of USD135,555.55 (RM610,000.00 equivalent).

[4] The Defendant on the other hand claims that it was the Plaintiff who failed to take delivery or secure purchasers of the Products after it arrived at OPL ('Off Port Limit') Singapore and therefore the deposit payment was forfeited. As for the partial payment of RM65,000.00 the Defendant claims that the money was paid as a financial assistance to the Plaintiff who had taken out loans to raise the security deposit. It was not a partial refund. Since the Plaintiff failed to lift the Products it was the Plaintiff who committed a breach of the MOU.

[5] The Defendant contends that by operation of cl 9 of the MOU the dispute must be referred to the High Court in London since it was an express and agreed contractual term between the Parties.

Decision Of The Session Court

[6] In deciding in favor of allowing the stay, the Sessions Court held that the decisions of the Court of Appeal in United Overseas Bank Limited v. United Securities Sdn Bhd & Ors ; [2021] 6 MLJ 897 ; and Open Country Dairy Limited v. Able Food Sdn Bhd ; had clearly held that where there is a contractually agreed exclusive jurisdiction clause requiring parties to adjudicate any dispute in the agreed foreign jurisdiction then such clause must be upheld. The Learned Judge opined that the express provisions of cls 9 and 11 of the MOU clearly obligated parties to submit any dispute to the High Court in London. The Learned Judge also found that to refuse the stay would amount to condoning a breach of the agreement by the Plaintiff.

The Law

[7] To begin with this Court refers the Court of Appeal decision in World Triathlon Corporation v. SRS Sports Centre Sdn Bhd ; [2019] 4 MLJ 394 ; [2018] 6 AMR 122 CA where it was held that Malaysian Co