An interim injunction cannot be granted if the applicant has breached the agreement and lacks clean hands; the balance of convenience must favor the party seeking to maintain the status quo.

JUDGMENT

Enclosure 3: Plaintiff's Application For An Injunction To. Amongst Others, Restrain The Defendants From Effecting Or Causing To Effect And/Or Taking Further Steps To Effect The Termination Of Their Agreement

Roz Mawar Rozain JC:

Introduction

[1] On 13 March 2023 this Court had granted an ad-interim injunction pending the hearing of the inter-partes arguments. This Court was comforted that certain safeguards were in place for just over two months whilst awaiting the inter-partes hearing.

[2] The Plaintiffs application under O 29 Rules of 2012 (RoC) to restrain the Defendant from effecting its termination of their agreement until final disposal of this suit extends to restraining the Defendant from evicting the Plaintiff from the mining land known as Lot 30421 held under Individual Title PN48785 Mukim and District of Seremban, Negeri Sembilan.

The Factual Matrix

[3] The Plaintiff mounted this action against the Defendant for a decree of specific performance of the mining agreement dated 22 October 2020. The Defendant is the owner of the mining land. The mining agreement allows the Plaintiff exclusive possession of the mining land and carry on mining activities thereon. The proprietorship of all minerals mined belong to the Plaintiff whilst the Defendant is entitled to the mining tribute.

[4] On 16 February 2024, the Defendant served a notice of default on the Plaintiff pursuant to cl 10.1.2 of the mining agreement. Clause 6.2.1 was also referred to and the Plaintiff was alleged as having failed to pay the tribute payable to the Defendant the sum of RM1,461,748.20. The claim was based on information received from the Malaysian Smelting Corporation (MSC).

[5] On 26 February 2024 the Plaintiff explained in its reply that based on its calculation there was a shortage of RM94,274.65 which was paid by direct transfer earlier.

[6] On 28 February 2024 the Defendant issued its notice of termination and demanded the Plaintiff quit possession of the mining land within 30 days.

Grounds For The Plaintiff's Application For The Interim Injunction

[7] The Plaintiff contended that the purported termination of the mining agreement by the Defendant is wrongful and invalid in law. The Plaintiff submitted that an interim injunction is necessary to preserve the status quo of the mining agreement until the trial of this suit. Without an interim injunction, the Plaintiff will be evicted from the mining site and deprived of its contractual right to mine and sell the tin ores extracted from the Defendant's land. This Court was reminded that the main relief sought for is a decree of specific performance to effect the mining agreement.

The Defendant's Arguments

[8] The Defendant vehemently objected to the Plaintiff's application for the interim injunction. The legal principles laid down in Keet Gerald Francis Noel John v. Mohd Noor bin Abdullah , 1994 MarsdenLR 2101 were referred to. This Court was implored to consider that there were no bona fide serious issues to be tried because it submitted that the termination of the mining agreement was lawful and valid based on the following:

(i) the Plaintiff has breached the mining agreement by failing to pay the full mining tributes promptly based on the agreed formula under cl 6.2.1;

(ii) the Plaintiff has failed to remedy the breaches despite the Defendant's notice of default dated 16 February 2024;

(iii) the Plaintiff cannot unilaterally vary the terms of the mining agreement without the Defendant's consent by virtue of cl 14 thereof; and

(iv) the Defendant has validly terminated the mining agreement in accordance with cl 10.1.2 due to the Plaintiffs failure to remedy the breaches.

[9] The Defendant further submitted that the Plaintiff is not entitled to equitable relief because it did not come with clean hands, having:

(i) fraudulently concealed the actual amount of tin ores mined and sold to MSC; and

(ii) had purportedly colluded with the Defendant's former director, Suhairunizam bin Abu Bakar, to unilaterally reduce