The court ruled that an implied term regarding regulatory approvals was not specifically pleaded and could not be raised on appeal, and even if it were, the plaintiff's failure to provide necessary documents negated any breach by the defendant.

Introduction

[1] The appellant plaintiff in this case, Bestinet Sdn Bhd, engaged the respondent defendant, GHL e-Payments Sdn Bhd, for the latter to develop an e-wallet application for foreign workers. Bestinet operates a centralised system to manage foreign worker applications into Malaysia. It was common ground that Bestinet's operations involve the department of immigration and that consequently its activities are overseen by the ministry of home affairs (Kementerian Dalam Negeri, frequently referred to by its acronym KDN).

[2] No formal contract was entered into between the parties. The parties had proceeded upon the basis of a quotation issued by GHL e-Payments on 5 April 2017. The agreed one-time fee was RM875,000, with separate annual payments for data hosting and maintenance. Bestinet paid RM371,000.00 to GHL e-Payments, pursuant to two invoices issued by the latter to the former.

[3] In their claim, the Bestinet alleged breach of contract and misrepresentation. It claimed, among others, that GHL e-Payments had represented to it that:

(a) GHL e-Payments was an e-wallet services provider that was licensed by Bank Negara Malaysia, the Malaysian banking and finance industry regulator; and

(b) GHL e-Payments was able to obtain the approval of Bank Negara for the proposed e-wallet application.

[4] It transpired that GHL ePayments had engaged a third party called MRuncit Commerce Sdn Bhd to provide the e-wallet services. In its suit, Bestinet claimed that it had not been told of this fact by GHL e-Payments.

[5] Bestinet's case was that the parties had agreed to a timeline of the end of January 2018 for the e-wallet application to be operational. It was not in dispute that this timeline was not met. Bestinet terminated the contract between it and GHL e-Payments on 1 August 2019.

[6] Bestinet claimed for the return of the RM371,000.00 paid by it to GHL e-Payments. GHL e-Payments in turn counterclaimed (among others) for a declaration that the termination of the contract by Bestinet was unlawful and for loss of profits amounting to RM1,855,000.00.

At The High Court

[7] The High Court dismissed Bestinet's claim. The decision of the High Court may be summarised as follows:

(a) as regards the claim for misrepresentation, the trial Judge made a finding of fact that Bestinet had failed to establish that GHL e-Payments made the relevant representations to Bestinet prior to the contract coming into existence. The trial Judge observed that Bestinet's witnesses at trial only came to be employed by it after the contract was entered into, and thus could not have had personal knowledge regarding any pre-contract representations;

(b) as regards the claim for breach of contract, the trial Judge made a finding of fact that the reason why the timeline was not met was because Bank Negara was not given certain further information and documents that Bank Negara had required in order to approve the increase in the e-wallet size from RM200.00 to RM1,500.00, and that the responsibility for providing these information and documents had lain with Bestinet. It followed that, if Bestinet had failed to provide the information and documents required, it would not be open to it to claim that GHL ePayments had committed a breach of contract by failing to adhere to the agreed timelines.

[8] The High Court also partially allowed GHL e-Payments'