JUDGMENT

Lim Chong Fong J:

Introduction

[1] The subject matter of this appeal originated from the Sale and Purchase Agreement (SPA) of the respondents' shophouse (the property). The respondents are husband and wife. The appellant is the purchaser and the respondents are the vendors. The agreed purchase price of the property is RM1.2 million. The appellant has paid a deposit of RM800,000.00 as part payment of the purchase price. The SPA was subsequently cancelled by the respondents.

[2] This cancellation of the SPA means, the respondents had to refund back to the appellant the deposit sum of RM800,000.00. Pursuant to the terms of the SPA, the respondents also had to pay to the appellant 10% of the purchase price amounting to RM120,000.00 as agreed liquidated damages.

[3] To resolve the outstanding payments issue between them, the appellant and the respondents entered into a Settlement Agreement (SA) and Friendly Loan Agreement. Under the SA, parties agreed that the respondents owed the appellant the sum of RM1.3 million (Settlement Sum). The detailed figures as to how RM1.3 is derived at is stated in the SA.

[4] It is not in dispute that the respondents had paid the appellant RM850,000.00