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2022 MarsdenLR 1215
HIGH COURT MALAYA KUALA LUMPUR
SWISS PLANNER SDN BHD – Appellant
Versus
PLUSH DOLLAR (M) SDN BHD & ANOR – Respondent
[Writ Summons No: WA-22NCVC-778-11/2018]
The tenant is bound by the written terms of the tenancy agreement, including payment obligations, regardless of external approval processes.
Headnote:(A) Contracts Act 1950 – Section 9.05 – Tenancy Agreement – The plaintiff claims for unpaid rentals for 2016-2021 and repairs post-termination of tenancy agreement – First defendant breaches tenancy by failing to pay and deliver premises in good condition – Court found defendants liable for unpaid sums and damages for breach of contract. (Paras 14, 75, 108)
(B) Tenancy Obligations – Defendants' arguments on mitigation of damages and obligation to obtain DBKL approval deemed unfounded under contract terms – Condition of premises upon return held against First defendant as per tenancy obligations. (Paras 39, 106)
Facts of the case: The plaintiff, landlord of Plaza Pengkalan, entered into a tenancy agreement with the First defendant following the winding up of Nirwana Academy, which failed to pay dues. Subsequent agreements saw continued breach leading to lawsuits. The Second defendant acted as a guarantor but was also found liable.
Findings of Court: The plaintiff is entitled to receive both the unpaid rentals and damages as outlined in the tenancy agreement despite the defendants’ attempts to counter the claims based on false premises.
Issues: Whether defendants had valid grounds to terminate the tenancy and their liability for unpaid rentals.
Ratio Decidendi: The court ruled that the plaintiffs' claims were substantiated and that the obligations of the defendants under the tenancy agreement were clear and binding. The claims for damages and overdue rentals were thus granted.
Result: The defendants are ordered to pay the plaintiff the outstanding sums along with costs of the proceedings.
Introduction
A.1 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.
[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, mezannine Floor, 9th, 22nd, and 23rd floor of the Plaza Pengkalan.
[3] The above-referred tenancy was for a period of 3 years from 16 April 2014 to 15 April 2017.
A.2 Plaintiff's Claim Against The Defendants
[4] However, Nirwana Academy Sdn Bhd ("Nirwana Academy") failed to pay the rentals due to the plaintiff and caused theplaintiff 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 binti Badaruddin J in the Companies (Winding-Up) Petition No: 28NCC-650-08/2015.
[5] Thereafter, a new tenancy agreement was entered between the plaintiff and the First defendant. The said tenancy agreement was also secured by a guarantee given by the Second defendant.
[6] This new tenancy was for a period of 11 months beginning from 15-2016 to 15 April 2017 with an automatic renewal of a further 2 consecutive terms of 3 years each and a final term of 1 year. The new tenancy was also 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 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 First defendant had attempted to terminate the tenancy for the ground floor, mezzanine floor and the 9th 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.
[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 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.
[11] Since then, the plaintiff chose to terminate the Tenancy Agreement as 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.
[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.
[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 3-72019 in the Bankruptcy Proceedings bearing number WA-29NCC- 3520-08/2016.
[14] Due to the breach of the Tenancy Agreement, the plaintiff claims the following against the defendants:
(i) Rentals for the period between May 2016 to May 2021 - RM7,700,720.80;
(ii) Interest accrued as at 9 June 2021 - RM1,906,212.64;
(iii) Sewerage charges from May 2016 to June 2021 - RM233,514.48;
(iv) Loss of rentals from 1 June 2021 to 15 April 2024 - RM5,103,050.06;
(v) The defendants is d
