Background

[1] The Plaintiff was given a right by the 1st Defendant to carry out logging activities at the Hutan Simpan Bukit Gading and Bukit Belata for an approximate area of 9000 hectares. The approval for the logging activity was contained in a letter of approval issued by the 1st Defendant on 30 September 1999 containing various terms and conditions. This terms and conditions were accepted by the Plaintiff who commenced the logging activities.

[2] No formal agreement was executed between the Plaintiff and the Defendants although the parties exchanged draft formal agreements, the final Draft Formal Agreement was vide the 1st Defendant's letter dated 10 May 2003.

[3] A dispute between the Plaintiff and the Defendants arose when the Defendants directed the Plaintiff by way of a letter dated 5 October 2005 to cease logging operation in 5 compartments at Hutan Simpan Gading. The Plaintiff was nevertheless given a choice to choose alternative areas to replace the existing areas.

[4] Both parties could not agree on the alternative site for the logging and on the failure of the Defendants in replacing the existing area agreed upon, prompted the Plaintiff to commence a civil