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2025 MarsdenLR 2653
SESSION COURT SHAH ALAM
MINSYAM SDN BHD – Appellant
Versus
CHOO LIN (M) SDN BHD – Respondent
[Civil Suit No: BA-B52-3-01/2022]
A periodic tenancy cannot be established without consistent rental payments post-expiration of a fixed-term tenancy; internal disputes among directors can invalidate legal standing to sue.
Headnote:(A) Tenancy Agreement - Breach of tenancy and trespass - The Plaintiff, a manufacturing company, claimed to be the lawful tenant after the expiry of the tenancy agreement on 31 March 2020, alleging the Defendant leased the premises to a third party without consent - The court found no valid periodic tenancy existed post-expiration due to non-payment of rent and internal disputes among directors - The Defendant's new tenancy agreement with a third party was deemed valid. (Paras 34-75)
(B) Legal Standing - The court ruled that the Plaintiff lacked locus standi to initiate the lawsuit as there was no unanimous resolution from the directors authorizing the action. (Paras 61-62)
(C) Indemnity Clause - The court emphasized that the indemnity clause in the tenancy agreement absolved the Defendant from liability for claims arising from the Plaintiff's internal disputes. (Paras 70-76)
Facts of the case:
The Plaintiff and Defendant entered into a tenancy agreement on 5 October 2018, which expired on 31 March 2020. The Plaintiff continued to occupy the premises and made sporadic rental payments, while the Defendant later leased the premises to a third party without notice.
Findings of Court:
The court found no evidence of a valid periodic tenancy post-expiration and ruled that the Plaintiff's claims were dismissed due to lack of standing and contractual obligations.
Issues: The main issues included whether a periodic tenancy existed after the original agreement expired and the Plaintiff's legal standing to sue.
Ratio Decidendi: The court concluded that the tenancy had expired due to non-payment and internal disputes among directors, and the Defendant had the right to lease the premises to a third party.
Result: The Plaintiff's claims are dismissed, with costs fixed at RM20,000.00 to be paid by the Plaintiff to the Defendant.
JUDGMENT
(After A Full Trial)
A. Introduction
[1] This is a case concerning breach of tenancy agreement and trespass.
B. Salient Facts Of The Case
[2] The Plaintiff, Minsyam Sdn Bhd, is a manufacturing company that produces and markets wellness products, while the Defendant, Choo Lin (M) Sdn Bhd, owns the premises in dispute.
[3] The Plaintiff and the Defendant had entered into a tenancy agreement dated 5 October 2018. The Tenancy Agreement ended on 31 March 2020.
[4] After the expiry of the tenancy agreement, the Plaintiff remained operating at the premises with the knowledge of the Defendant.
[5] Plaintiff continued to occupy the premises and paid few monthly rentals after 31 March 2020 whilst the Defendant had accepted the rental. Defendant did not issue any notice for repossession nor did the Defendant give Plaintiff any advance notice to vacate the premises. Therefore, Plaintiff continued to occupy the premises without moving its assets to another place.
[6] On 20 August 2021, one of the Plaintiff's director SP2 was barred from entering the premises.
[7] On 27 September 2021 SP2 came to know that the Defendant had entered into a new Tenancy Agreement dated 1 September 2021 with Rizd Teja Resources Sdn Bhd (RTR).
[8] SP2 alleged that the Defendant had rented the premises to a third party, RTR, without the Plaintiff's knowledge or consent.
[9] SP2 claimed that this is a breach of tenancy and an act of trespass, leading to financial losses due to loss of access to essential equipment.
[10] Plaintiff filed a writ together with a Statement of Claim dated 3 February 2022 against the Defendant for the Defendant to reinstate the Plaintiff's position as the tenant for the premises and other reasonable and appropriate relief.
C. Competing Arguments Of Parties
Submission By The Plaintiff
[11] Plaintiff submitted that it was the lawful tenant and argued that if a landlord continues to accept rent after a fixed-term tenancy expires, a new tenancy from month to month is created (Tan Khien Toong & Ors v. Hong Bee & Co; [1987] 1 MLJ 387; [1987] CLJ (Rep) 353 (Supreme Court ) referred).
[12] Plaintiff contended that evidence, including rental payments and witness testimony, supports that the Plaintiff was still a lawful tenant post 31 March 2020.
[13] Plaintiff insisted that tenancy continued after 31 March 2020 as a periodic tenancy continues indefinitely unless terminated by proper notice (Zakaria Hanafi v. Ibrahim Hanafiah & Ors; [1999] 4 MLJ 568; [1999] 3 CLJ 807; [1999] 4 AMR 4061 - Referring to Prudential Assurance Co Ltd v. London Residuary Body [1992] 2 AC 386).
[14] It was said that the Plaintiff's continued occupancy and rental payments indicate an extension of the tenancy.
[15] Relying on Saadian Karim v. Ong Ting Chai; [1996] 5 MLJ 646, Plaintiff submitted that a valid notice to quit must be unambiguous and adhere to the required notice period and since no notice was given to the Plaintiff before leasing the premises to a third party, the Defendant breached the tenancy Agreement.
[16] Plaintiff cited the case of Low Kwye Ying v. Chan Yek Ying; [1971] 1 MLJ 151 and averred that the right to quiet enjoyment protects tenants from interruptions in possession.
[17] According to the Plaintiff, the Defendant's actions of leasing the premises to RTR disrupted the Plaintiff's business and violated this covenant.
[18] The Plaintiff claimed financial losses from being unable to access essential production equipment and Plaintiff had to outsource manufacturing at increased costs.
[19] The Plaintiff sought damages and reinstatement as the lawful tenant.
[20] Regarding the issue about the locus of the Plaintiff's solicitor to act on behalf of Plaintiff, Plaintiff's solicitor argued that he was properly authorised to act as Plaintiff's Solicitors. Based on Ulimas Sdn Bhd v. Hi-Summit Construction Sdn Bhd & Other Appeals; [2017] 2 MLJ 153; [2017] 2 CLJ 636; [2017] 2 AMR 420, a company can appoint solicitors without a formal board resolution, and a
