Per Edgar Joseph Jr FCJ (Mohd Jemuri Serjan CJSS concurring):

[1] In this appeal, the essential facts which are not in dispute may be shortly stated.

[2] By an agreement in writing dated 13 September 1984 ("the agreement"), entered into by the respondent/plaintiff ("the seller") and the appellant/defendant ("the buyer"), the seller had agreed to sell to the buyer and to install a Jaques crushing plant at the premises of the buyer, at Pedas, Negeri Sembilan, at a price of RM1,167,000.

[3] By cl 3 of the agreement, the buyer had agreed to pay to the seller, an initial sum of RM116,700, being 10% of the purchase price, expressly stipulated therein as a deposit, to be paid upon signing the agreement.

[4] It is noteworthy - in view of the discussion which follows - that the agreement distinguishes between the initial payment of the sum of RM116,700 expressly stipulated in cl 3 therein as a "deposit", and payment of four subsequent sums, namely:

RM 408,450 - "on delivery of prime equipment ie all crushers and screens in this project;"

RM 408,450 - "on delivery of the essential steel structures for crushers and screens support, chuteworks, conveyor frames and ancilliaries;"

RM 175,050 - "on completion of erection and ready to test and commissioning;" and

RM 58,350 - "30 days after commissioning and acceptance of the plant."

[5] The seller was ready, able and willing to install the Jaques crushing plant pursuant to the agreement and, indeed, did manufacture the custom-made fabrication steel work, but, in breach of cl 3 thereof, the buyer, although obliged to pay the sum stipulated as a deposit, upon signing the agreement, had failed to pay the same or any part thereof, by reason whereof, the seller had terminated the agreement on the ground of breach by the buyer. Thereupon, the seller had sued the buyer, for recovery of the sum stipulated in the agreement as a deposit and consequential reliefs.

[6] The primary defence pleaded by the buyer in its Statement of Defence appears in paras 2 and 3 thereof, the material portions of which read as follows:

2. ... it was specifically agreed by both parties that no payments would be made on signing the agreement as:

(a) the title for the quarry had not been released to the defendants which was to be used as collateral to raise funds to buy the crushing plant;

(b) no quarry licence had been issued to the defendant;

(c) no power supply had been approved for the quarry plant;

(d) no license had been obtained from the police to store explosives in the quarry.

3. It was further agreed by both parties that payments would only be made after the provisions stated in para 2(a), (b), (c) and (d) herein have been obtained and the plaintiffs were fully aware of and agreed to these.

[7] It was further pleaded, by para 5 of the statement of defence, that the buyer had never at any time instructed the seller to commence work as the requirements spelt out in para 2(a) to (d) of the statement of defence (quoted above) had not been complied with. There was also the usual omnibus denial save except where there had been express admission.

[8] At the trial, in the High Court at Seremban, the uncontradicted testimony of the seller's General Manager, Dennis Khoo Chong Phoe - which the Judge had accepted - was as follows (at p 31A, Appeal Record):

Shown PI ms 3. Yes, asked for 10% deposit RM116,700. No payment made of 10% deposit. Defendant asked for a few days time. Defendant reminded of the urgency of commencement and asked me to proceed with the contract. We proceeded with the contract despite non-payment of 10% of deposit. My company reminded defendant verbally, asked them since work was in progress.

[9] And later, in cross-examination, the same witness said this (at p 33):

Defendant told us to commence and sign the agreement and collect the deposit but after signing the agreement he told us to come and collect the cheque for 10% a few days later because they were still negotiating with the bank.

[10] And, still later at p 34A h