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FEDERAL COURT PUTRAJAYA
SPM MEMBRANE SWITCH SDN BHD – Appellant
Versus
KERAJAAN NEGERI SELANGOR – Respondent
Key Points: - A notice of termination must specify reasons if the contract provides for a review process before termination is valid (!) (!) (!) . - The review procedure under the contract must be completed before termination under cl 8.1(b) may be validly exercised (!) (!) (!) . - Upon wrongful termination, the non-breaching party may be entitled to compensation for loss of profit as a natural and probable result of the breach (!) (!) (!) .
| Table of Content |
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| 1. court must determine necessity of providing reasons for contract termination. (Para 1 , 14 , 15) |
| 2. interpretation of clauses in relation to termination rights. (Para 2 , 6 , 68 , 83) |
| 3. discusses judicial findings on contract performance and termination. (Para 10 , 11 , 12) |
[1] Leave for the appeal before us was unanimously granted on 11 April 2013 on the question of law of "whether a notice to terminate a concession/ privatisation agreement which is vague, unspecific and uncertain is defective and bad in law".
The Facts
[2] Kerajaan Negeri Selangor ("the respondent") and SPM Membrane Switch Sdn Bhd ("the appellant"), entered into an agreement ("the agreement") on 27 September 2001 in which the respondent appointed the appellant to assist them in collecting outstanding annual quit rent in Selangor (particularly in the districts of Petaling, Kuala Langat, Hulu Langat, Sepang and Hulu Selangor).
[3] A supplemental agreement was entered into on 9 July 2003.
[4] Pursuant to the agreement, the appellant was responsible for the collection of arrears of quit rent. There were a number of obligations the appellant had agreed to, which amongst others, included the
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