A binding contract existed post-expiry due to acceptance of services, entitling the plaintiff to compensation based on quantum meruit principles and prior contract terms.

[1] The plaintiff is a company which was, at all material times, a licensee for technology relating to a specialised fuel marker known as the NanoTag, which is used, inter alia, for the marking of subsidised diesel for the purposes of carrying out inspections to detect cases of abuse of subsidised diesel. The plaintiff's claim against the defendant, the Government of Malaysia, is premised on breach of contract, or alternatively for work done on a quantum meruit basis, for which it claims it remains unpaid.

[2] The background relating to the dispute arose as follows. On 21 September 2006 the plaintiff and the Government of Malaysia entered into an agreement ('the original agreement') whereby the defendant appointed the plaintiff to provide the services of supplying NanoTag proprietary fuel markers pursuant to the plaintiff's NanoTag program to mark subsidised fuel and for other related services. The plaintiff's program was important in the defendant's efforts to control the widespread abuse of subsidised diesel which had caused significant losses to the defendant.

[3] The original agreement was for a term of five years which expired on 31 March 2011. It was fully performed by the plaintiff and the plaintiff received the full contract price for the term of the contract. This is not in dispute.

[4] After the expiry of the original agreement the plaintiff, pursuant to a series of correspondence between the parties continued to provide the services as described under the original agreement to the defendant, notwithstanding the expiry of the original agreement. Such services were provided for a period from 31 March 2011 to 31 October 2011, ie a period of about seven months ('the interim period'). The defendant accepted the plaintiff's services during the interim period.

[5] During the interim period negotiations were conducted between the defendant and, inter alia, the plaintiff, for a fresh or new agreement on terms similar to the original agreement. Other parties were also invited to participate in or to submit tenders for consideration. Eventually, no new contract was awarded to any of the parties, including the plaintiff.

[6] The plaintiff was not paid for its services during the interim period. This is primarily because of a dispute as to the construction to be placed on the correspondence between the parties upon the expiry of the Original Contract. In this context, the plaintiff maintains that it offered to continue to provide services to the defendant notwithstanding that the Original Contract had expired and that a new contract was being negotiated. The plaintiff further maintains that it was implicit at all times that it was to be fully remunerated on terms identical to the Original Contract for the provision of such services.

[7] The defendant on the other hand however, maintains that by reason primarily of the use of the words 'without commitment' in the plaintiff's letter of offer, it is understood that such services were to be provided by the plaintiff entirely without charge. In other words, the defendant understood from the offer that the plaintiff was providing its services free of charge. The defendant insists that it only accepted the plaintiff's offer on those terms, namely that there would be no charge incurred.

[8] The defendant points to the fact that the original agreement had expired on 31 March 2011 and that no agreement was ever reached between the parties to extend the agreement. Neither was any fresh con