Specific performance is appropriate where shares are not freely saleable, as monetary compensation would not provide adequate relief, affirming the right to specific performance as per contract terms.

Ong Chee Kwan J:

Introduction

[1] Enclosure 26 was the Plaintiff's application for summary judgment wherein the Plaintiff sought for, inter alia, the following reliefs:

(a) specific performance of the share sale agreement dated 1 September 2023 ("the SSA") for the sale of 119,815 shares ("the Sale Shares") held by the Plaintiff in Ann Heng Sdn Bhd ("the Company") through the following means:

(i) the Defendant to pay the remaining balance of RM4,000,000.00 to the Plaintiff within 14 days from the date of judgment; and

(ii) the parties to complete the sale of the Sale Shares in accordance with cl 4 of the SSA;

(b) alternatively, damages to be assessed for the Defendant's breach of contract as an addition or substitute for specific performance;

(c) the Defendant to procure the payment of Director's Fees by the Company to the Plaintiff at RM2,000.00 per month from August 2024 until the completion of the SSA as agreed and provided under cl 3.4 of the SSA;

(d) interest at a rate of 8% per annum on the remaining balance of RM4,000,000.00, calculated daily, from 1 March 2024 until the actual date of payment of the remaining balance.

[2] Significantly, the Defendant did not dispute that he had breached the SSA but contended that specific performance would not be an appropriate remedy in the circumstance of this case.

Background Facts

[3] The Company, Ann Heng Sdn Bhd, was incorporated on 3 November 1981. At all material times, the Company was a property holding company without any business operation.

[4] The issued and paid up share capital of the Company at the material times comprised of 958,517 ordinary shares of RM1.00 each.

[5] The Plaintiff owned 12.5% equivalent to 119,815 shares whereas the Defendant owned 12.2% equivalent to 117,317 shares of the Company.

[6] Both the Plaintiff and Defendant are directors of the Company.

[7] The controlling stake in the Company (601,574 shares or more than 60%) belonged to members of the Defendant's family ("Teh Family"). At all material times, the Defendant was and still is the Managing Director of the Company.

[8] On 1 September 2023, the Plaintiff and the Defendant entered into the SSA whereby the Plaintiff agreed to sell and the Defendant agreed to purchase all the Sale Shares from the Plaintiff, comprising the Plaintiff's entire 12.5% of the shareholding in the Company for a total consideration of RM5.0 million.

[9] Pursuant to the SSA, the Defendant had paid the Plaintiff RM1,000.000.00 (equivalent to 20% of the total purchase price) as the initial sum ("Initial Sum").

[10] The balance sum of RM4,000,000.00 was to be paid within six (6) months from 1 September 2023, ie on or before 29 February 2024 ("Completion Date") or within the extended further three (3) months, ie on or before 31 May 2024 ("Extended Completion Date").

[11] Quite apart from the sale of the Sale Shares, cl 3.4 of the SSA further provided that the Defendant would procure that the Company makes timely payment of the Plaintiff's director fee of RM2,000.00 per month ("Director's Fee") which shall continue to be paid until Completion.

[12] The Defendant contended that the Plaintiff was aware that although the SSA was executed between the Plaintiff and the Defendant, the Defendant was merely acting as a proxy representing the Teh Family.

[13] The Defendant further contended that he had encountered hardship to perform the SSA as the expected family funding for the purchase was not forthcoming. As a result, despite the extended Completion Date, the Defendant was unable to complete the purchase of the Sale Shares.

[14] It was not in dispute that under the SSA, in the event the Defenda