The obligation to pay land premium is independent from the obligation to deliver vacant possession, and a failure to provide possession constitutes a breach of contract.

[1] This is a contract action for breach of a joint venture agreement to develop a housing and industrial project in Sepang, Selangor.

[2] The Plaintiff is a private limited company involved in the business of industrial property development.

[3] The First Defendant is an incorporated body of the Selangor State Government pursuant to the Selangor State Enactment.

[4] The Second Defendant is a private limited company owned by the Selangor State Government.

The Trial Process

[5] By consent of the parties, the trial at this stage is on liability only with damages to be subsequently assessed depending on the outcome of the trial.

[6] The trial was conducted on 9 and 10 June 2014. The trial documents were marked as bundles A to D with the documentary evidence wholly contained in bundle B.

[7] The following witnesses testified at the trial for the respective parties:

i) Kenny Lim Kah Joo (PW1) who is a director of the Plaintiff; and

ii) Md Yunus @ Iskandar bin Md Noor (DW1) who was the project manager of the Defendants.

[8] After the conclusion of the trial, the Parties submitted their respective closing written arguments. There was oral clarification with counsel held on 12 July 2014.

Background Facts

[9] By a written joint venture agreement dated 7 April 1995 ("Joint-Venture Agreement") the parties agreed to jointly carry out housing and industrial development ("Project Development") on the land at Lot 5317, Mukim Dengkil, Daerah Sepang, Selangor Darul Ehsan ("Land"). At that time, sand mining activities were being carried out on the Land.

[10] The First Defendant is the beneficial owner of the Land for which separate documents of titles were in the process of issuance by the State Authority. The First Defendant assigned all its rights, benefits and obligations of the Land to the Second Defendant.

[11] The material terms of the Joint-Venture Agreement (where the Plaintiff is referred to as the Company and the First Defendant as the Corporation therein respectively) are as follows with the necessary emphasis added:

Formal Approval By The Corporation Of Plans

2(i) The Company shall within Three (3) months from the date of this Agreement at their own cost and expenses prepare and submit to the Corporation for the Corporation's formal approval the layout plans, elevations, sections, drawings and other relevant plans, if any, in duplicate of the buildings, erections and structures to be put up on the Land together with an outline of the specifications of the proposed method of construction to be employed and the materials to be used.

Submission Of Layout Plan To The Government Authorities

2(ii) The Company shall immediately upon the Corporation having formally approved the plans as in sub-clause (i) above submit the layout plans of the Housing & Industrial Development to the relevant Government Authorities and shall endeavour to obtain such Authorities approval of the plans. The Corporation undertakes to assist the Company and its endeavour to obtain necessary approvals from the relevant Authorities if its assistance in necessary. Provided that where a delay is occasioned through no fault of the Company the Corporation shall allow the Company such further time as may be reasonable to obtain such approval. Such extension of time given hereunder shall be writing.

Submission Of Building Plan Etc To Government Authorities

2(iii) Upon the relevant Government Authorities approval as in sub-clause (ii) above having been obtained the Company shall submit to the Authorities for t