A contract aiming to influence public decision-making is void if against public policy, according to Section 24(e) of the Contracts Act 1950.

[1] The question upon which leave was granted to appeal against the order of the Court of Appeal in respect of the matter decided by the High Court in the exercise of its original jurisdiction, reads:

"Whether an agreement to provide services to influence the decision of a public decision maker to award a contract is a contract opposed to public policy as defined under s 24(e) of the Contracts Act 1950 and [is] therefore void?"

[2] The background facts could be summarised as follows. Evidently, there was a plan by the Government of Malaysia for a bridge to replace the Johore- Singapore causeway (hereinafter referred to as the bridge project), and that the Economic Planning Unit of the Prime Minister's Department, by its letter dated 25 June 1998, awarded, in principle, the execution of the bridge project to one Suria Kalbu Sdn Bhd in which the 2nd appellant had an equity of 60%. Hitherto, the appellants had requested the respondent "to render his services to procure and secure the award" of the execution of the project from the Government of Malaysia", for which services the appellants had agreed to pay RM20 million to the respondent. Those "facts" appeared in the following letter of undertaking dated 3 July 1998 of the 1st appellant to the respondent, which was countersigned by the respondent in agreement.

LETTER OF UNDERTAKING

To:

MR SHAZRYL ESKAY BIN ABDULLAH

IC 600216-02-5215

22 JALAN BRUAS

DAMANSARA HEIGHTS

50490 KUALA LUMPUR

"WHEREAS the Procuror has at our request agreed to render his services for the purpose of procuring and securing from the Government of Malaysia the award of the project known as "Cadangan Pembinaan Jambatan Menggantikan Tambak Johor secara Penswastaan" (hereinafter referred to as the "Project") in favour of the Consortium called SURIA KALBU SDN BHD OF No 3, Jalan 222, 46000 Petaling Jaya (Company Registration No 452586-U) (hereinafter called the "Consortium") of which we have a 60% equity participation in the issued share capital."

WHEREAS through the Procuror's services aforesaid the Unit Perancang Ekonomi Jabatan Perdana Menteri by letter dated 22th June 1998 has awarded in principle the project to the consortium.

In consideration of the services aforesaid rendered by the Procuror we Merong Mahawangsa Sdn Bhd (Company Registration No 463227-X) a company incorporated in Malaysia and having its registered address at No 3372, Jalan 18/31, Taman Sri Serdang, 43300 Seri Kembangan, Selangor Darul Ehsan hereby undertakes and agrees to pay you sum of Ringgit Malaysia Twenty Million only (RM20,000,000.00) being the agreed remuneration payable on or before 3rd November, 1998.

This undertaking shall remain valid so long as the award for the project remains valid and subsisting and should the award be withdrawn and or terminated for any reasons whatsoever the aforesaid sum of RM20,000,000.00 or any part thereof shall be refunded without interest immediately.

Dated this 3rd day of July 1998

sgd

...................................

YAHYA BIN A JALIL

Pengarah Eksekutif

Merong Mahawangsa Sdn Bhd

I confirm my agreement to

the Undertaking aforesaid

sgd

.........................................

SYAZRYL ESKAY BIN ABDULLAH

[4] The pleaded defence of the 1st appellant was two-pronged. First, the 1st appellant pleaded that the asserted procurement of the bridge project on account of the respondent's close relationship with the Government of Malaysia and Dato' Seri Megat Junid was against public policy and that the said letter of undertaking was illegal and void. Then again, the 1st appellant also pleaded that the respondent had not secured any project from the Government of Malaysia for the 1st appellant, that on 11 August 2003, the bridge project, which was redesigned, was awarded to one Gerbang Perdana Sdn Bhd, that on 12 April 2006, the Government of Malaysia wholly scrapped the bridge project, and that the letter of undertaking could not be put into effect as the bridge project had not materialised. Suffice it to say that t