Lord Hailsham LC (delivering the judgment of the Board):

This is an appeal from a decision of the Federal Court of Malaysia (Ong CJ, Suffian and Ali FJJ) allowing on 26 July 1969 an appeal by the plaintiff from the judgment of Gill J (as he then was) given in the High Court in Malaya at Kuala Lumpur on 25 November 1966.

The question in the proceedings was whether a vendor was entitled to forfeit a deposit paid on a contract for the sale of real property following its noncompletion by the purchaser though the vendor was not in a position to prove actual damage flowing from the purchaser's breach of contract. The appeal raises three points:

(1)Whether on the true construction of the contract the vendor was entitled to forfeit the whole deposit notwithstanding his inability to prove that he had suffered damage by reason of the purchaser's failure to complete.

(2)Whether in the circumstances s. 75 of the Contracts (Malay States) Ordinance of 1950, which is in the same terms as the s. 74 of the Indian Contract Act as amended, applied to the forfeiture in question so as to entitle the purchaser to recover his deposit notwithstanding his failure to complete.

(3)Whether s. 65