Zainun Ali JCA:

[1] The appeal before us is against the decision made on 7 March 2005 by the learned trial Judge of the High Court on the assessment of damages only. The trial Judge had awarded the respondent total damages of RM900,000 together with interest at 8% per annum from the date the action was filed until full realisation.

[2] The trial Judge had thereby set aside the decision of the deputy registrar made earlier on 5 July 2004 who awarded nominal damages of RM500 only to the respondent.

[3] The question of liability was decided by the said trial Judge on 8 June 2001 where he allowed the respondent's claim against the appellant. The trial Judge did not make any order on damages but ordered that damages be assessed by the senior assistant registrar the appellant appealed to the Court of Appeal against both these orders Via Civil Appeals No: P-02-614-2001 and P-02-1077-2001 respectively. On 6 July 2004, the Court of Appeal dismissed both appeals.

[4] Thus the threshold position of the appellant's liability was determined.

Background Facts

[5] The respondent is a Company having its registered office at No: 2683 2nd Floor Jalan Chain Ferry, Taman Inderawasih Butterworth, Pulau Pinang.

[6] The defendant is a Company operating at Prai Trade Zone, Prai Industrial Estate Pulau Pinang.

[7] It is the respondent's case that in or about 1993, one Encik Ramlan b Osman (SPI) (hereinafter referred to as 'Ramlan'), who was then Head of the appellant's Transport Department, was encouraged by the appellant Company's Group Head of Corporate Planning, one Mr Satoshi Hiramoto, that should he (Ramlan) leave the appellant Company, the said Appellant Company will award him the appellant's transport business.

[8] The said Ramlan then left the appellant Company and incorporated the respondent Company.

[9] According to the respondent, the appellant and the respondent entered into a written agreement dated 20 May 1994, wherein the respondent transported goods to and from the appellant's factory premises. The agreement was for 10 years ie, from 4 April 1994 until 4 April 2004.

[10] There were two main services rendered by the respondent to the appellant. They were:-

(a) Milk Run Truck Services (MRTS)

And

(b) Direct Delivery Service (DDS)

[11] The MRTS started in April 1994 and was terminated on 15 February 1996, whilst the DDS started in April 1994 and was terminated in September 1997.

[12] It is the respondent's case that the untimely termination of the agreement by the appellant resulted in losses to the respondent as pleaded in its statement of claim.

[13] The respondent's case for damages as pleaded in the statement of claim dated 10 March 1998 is as follows:-

In para 6, the respondent pleaded that 14 trucks were purchased under hire purchase agreements and lease agreements pursuant to the said agreement.

In para 8, the respondent pleaded that as a result of the appellant's breach of the said agreement, the respondent's creditors had repossessed 5 of their trucks and commenced legal proceeding against the respondent.

the respondent's claim is as follows:-

(a) loss of profits at the rate of RM600,000 per year for eight years - RM4,800,000

(b) balance outstanding to the debtors under the hire purchase agreement - RM1,335,044.42

(c) balance owing to Bank Bumiputra Malaysia Berhad - RM700,000

[14] As the appeal is only as regards quantum of damages, it is now timely to look at the quantum awarded to the respondent.

[15] On 7 March 2005, the learned High Court Judge awarded the following to the respondent:-

(a) Loss of profits - RM750,000

(b) Loss of capital - RM150,000

and interest at the rate of 8% per annum from the date of the action being filed until full realization.

[16] It is the respondent's case that under the 1994 Agreement the respondent was to provide 60 units of 8 ton bonded trucks each month, to transport the appellant's goods to and from the appellant's factory.

[17] Paragraph 5 of the said agreement provides that the agreement is for a duration of 10 y