The court affirmed a binding sponsorship agreement exists despite signing delays, dismissing claims of undue influence and breach due to lack of evidence.

Evrol Mariette Peters JC:

The Claims

[1] The Plaintiff is a company that operates, manages and organises the Sepang F1 Circuit including the race team Moto3 that races under the team name "SIC Racing Team". The Plaintiff's claim against the Defendant company was for payment of the balance sum of MYR3,320,000 pursuant to a 2016 Sponsorship Agreement ("the 2016 Sponsorship Agreement") dated 19 September 2017 (exhibited at pp 297-352 of Part B of the Common Bundle of Documents ("CBD")).

[2] The Defendant's counterclaim against the Plaintiff was for the return of the amount of MYR650,000, paid by the Defendant pursuant to two agreements, namely the 2016 Sponsorship Agreement as well as an earlier 2015 Sponsorship Agreement dated 1 January 2015 (exhibited at pp 243-296 of Part B of the CBD), both of which it claimed were void; and alternatively, for damages in the amount of MYR33,176,109, arising from the Plaintiff's alleged breach of both Agreements.

[3] I allowed the Plaintiff's claim and dismissed the Defendant's counterclaim for the following reasons:

The Plaintiff's Case

[4] The Plaintiff's narrative began in 2014, when the Defendant expressed an intention to promote its brand name and logo with the SIC Racing Team, and to benefit from various other promotional and marketing opportunities as an official partner of the SIC Racing Team.

[5] The Plaintiff claimed that for a total consideration fee of EUD2,025,000, the Defendant had agreed to become the official partner and sponsor for the 2015 race season, with the option to renew the sponsorship for a further two seasons. The Defendant, however, had delayed in responding to the draft sponsorship agreement, and since the Plaintiff had, by March 2015, already commenced performance of its obligations, the Defendant proceeded to pay an initial sum of MYR300,000 on 8 July 2015 as a commitment fee towards the Plaintiff's racing team programme, pending the signing of the 2015 and 2016 Sponsorship Agreements (collectively "both Agreements").

[6] The Defendant requested to defer payment to 31 December 2015, and consequently to extend the sponsorship to the 2016 race season. The Defendant then proposed a reduction of the sponsorship fee for both the 2015 and 2016 race seasons, which further delayed the signing of both Agreements.

[7] The parties ultimately agreed to a sponsorship fee of EUD900,000 (MYR4 million) ("the Agreed Fee"), in consideration for the following rights:

a) Team Partner Rights for the race season from 1 January 2016 until 30 November 2016 ("the 2016 Sponsorship Term"); and

b) Title sponsorship of the SIC Racing Team, whereby the SIC Racing Team was to be named "DRIVE M7 SIC RACING TEAM" for the duration of the 2016 Sponsorship Term.

[8] As a result of the renegotiations, caused by the delay on the part of the Defendant to make payment, the parties had agreed to treat the 2015 race season as an incentive year for a nominal fee of MYR1, with the sum of MYR300,000 paid in July 2015 as part payment towards the Agreed Fee. Although two separate sponsorship agreements were prepared respectively for the 2015 and 2016 race seasons, the delay in payment by the Defendant resulted in the signing of both Agreements only in May 2017 by the Plaintiff and in July 2017 by the Defendant.

[9] Schedule 4 to the 2016 Sponsorship Agreement prescribed the manner in which the Agreed Fee was to be paid by the Defendant, with monthly installments payable from October 2016 to December 2019. The Defendant, however, made sporadic payments throughout November 2016 to January 2018 in the total amount of MYR350,000. A final amount of MYR30,000 was made on 25 July 2018, after the Defendant had proposed to reschedule the instalment payments.

[10] The Plaintiff's claim against the Defendant was for failing to make payment of the balance Agreed Fee amounting to MYR3,320,000 due and payable, as listed in Schedule 4 to the 2016 Sponsorship Agreement.

[11] The Plaintiff further claimed that all the allegations by