A contract founded on illegal actions, due to lack of required licenses, is void and unenforceable.

Enclosure 10

[1] Enclosure 10 is the Defendant's Application to strike out the Plaintiff's Writ of Summons and Statement of Claim under O 18 r 19(b), (c) and/or (d) of the Rules of 2012 ("ROC"), and for costs ("the Application").

Background Facts

[2] The Plaintiff is a company carrying on a business which includes preparing the site for construction, cut and fill works, site clearance, mineral extraction and the mineral export business.

[3] The Defendant is the registered owner of a parcel of land known as Lots 1, 2, 3, 4, 9, 12 and 18 located at Mukim Sungai Karang, Daerah Kuantan, Pahang Darul Makmur measuring approximately 500 acres ("the Land").

[4] Vide a Letter of Intent dated 3 December 2014 ("LOI 1") issued by the Defendant to the Plaintiff, the Defendant invited the Plaintiff to venture into a contract for the Plaintiff to do site clearance, extract mineral, and undertake a proper cut and fill works for the purpose of future development ("the works") over an approximate 100 acres of the Land area (at Lot 1 and portion of Lot 9 of the Land). The Plaintiff accepted the offer.

[5] On 5 February 2015, the Defendant issued a Letter of Award dated 5 February 2015 ("LOA 2") to the Plaintiff awarding the Plaintiff with the same works as in LOI 1, but for a larger area ie on Lot 18, Lot 12 and a portion of Lot 9 of the Land measuring approximately 200 acres. Under LOA 2, the award given to the Plaintiff is two-fold, as follows:

(1) First part, the Plaintiff's obligations under the agreement are:

(a) to perform site clearance and preparation on Lot 18, Lot 12 and a portion of Lot 9 of the Land for future development purposes;

(b) to ensure that the Land is duly leveled and suitable for future development; and

(c) to undertake and perform cut and fill works.

For these works, the proposed payment to be paid by the Defendant to the Plaintiff is in the total sum of RM10.8 million.

(2) Second part, the Defendant granted the Plaintiff rights to extract and dispose of the minerals, ie bauxite, found on site. For these works, the Plaintiff would pay the Defendant a lump sum fee of RM20 million as tribute payment according to the timelines agreed to by both parties.

(Note: Under LOA 2, the total tribute payment payable by the Plaintiff to the Defendant is RM30.8 million. However, a portion of the tribute in the sum of RM10.8 million (payable to the Defendant) shall be utilized by the Plaintiff to offset the cost incurred for the works referred to in the First part above, leaving a balance of RM20 million to be paid by the Plaintiff to the Defendant).

[6] Upon agreement by both parties, the Plaintiff entered a formal written agreement backdated to 1 December 2014 with the Defendant ("Agreement"). By a Variation Letter dated 2 March 2015 from the Defendant to the Plaintiff ("Variation Letter"), the Defendant and the Plaintiff agreed to vary the terms of the Agreement dated 1 December 2014 which, inter alia, include the following:

(1) The commencement date of the Agreement shall be 18 February 2015, instead of 1 December 2014;

(2) The Appointment and Duration of the Agreement under cl 2 of the Agreement shall be a term of 2 years from the commencement date, with an option to extend for a further 1 year from the expiry of the initial term.

(3) The termination notice period under cl 5 of the Agreement shall be 60 days.

(4) The Payment Schedule for the tribute payment of RM20 million to the Defendant was amended.

[7] On 5 June 2015 the Defendant issued another Letter of Intent ("LOI 3") to the Plaintiff for the same works, and to prepare the access road, make ready and/or prepare trench borders, and to do the necessary landfills over the contiguous area to the portion o