Mokhtar Sidin JCA:

In the court below, the appellant was the first plaintiff and the respondent was the defendant. The second plaintiff is not a party to the present appeal. I will refer to the parties as they were in the High Court.

According to the amended statement of claim, both the plaintiffs own in equal share a piece of land held under EMR No. 2155 for Lot No. 1189 in the Mukim and the District of Klang (hereinafter referred to as "the said land"). Some time on 17 December 1974, both plaintiffs entered into a written joint venture agreement (hereinafter referred to as "the agreement") with the defendant to develop the said land into a housing estate. Under the said agreement the second plaintiff was to sell 1/2 of his undivided half (1/2) share of the said land to the defendant for RM26,437. By virtue of that, the defendant became the beneficial owner of an undivided 1/4 share in the said land while the first plaintiff remained the owner of an undivided half (1/2) share of the said land. The title to the said land was then handed over to the defendant in order to facilitate him to carry out the obligations under cl. 5 of the agreement:

(a) to apply for conversion of the said Land from agricultural to housing and to pay all the necessary fees for such conversion;

(b) to fill the said Land to a height in accordance with the Town Council stipulations and regulations;

(c) to cause or to take such steps to have the said Land sub-divided and to forward the sub-divisional plans to the Collector of Land Revenue, Klang and on approval being obtained to sub-divide to surrender the Title of the said Land to the Collector of Land Revenue including the payment of all such necessary fees for the said sub-division;

(d) to prepare plans for the construction of single storey terrace houses on the said Land and to construct the houses to a minimum size of 840 sq. feet (20' x 42');

(e) upon the completion of the houses the apportionment or allotment was agreed as follows:

seventy (70%) for the Defendant;

thirty (30%) for the Plaintiffs.

(f) all odd lots after sub-division shall be allotted in the same manner as provided in sub-clause 6 of the said Agreement;

(g) the said Defendant shall complete the construction of the houses within a period of three (3) years from the date of the said Agreement;

(h) sale prices of the houses shall be fixed jointly by the Plaintiffs and the Defendant.

It was not disputed that the defendant was not able to carry out his obligations under the said agreement within the stipulated period and as a result of that the plaintiffs through their solicitors, Messrs K.S. Choo & Company gave notice in writing dated 10 June 1980 to terminate the agreement and demanded the return of the land title. It was also not disputed that at the time when the notice of termination was given, the first plaintiff, at the request of the defendant, had paid the sum of RM17,408 as conversion fees and RM9,000 for drainage and irrigation fees which is the central issue of this appeal.

Upon receiving that notice, the defendant approached the plaintiffs and requested that the said agreement be vacated and in its place proposed a new joint venture agreement. The plaintiffs indicated to the defendant that they would agree to a new joint venture agreement if certain terms be included in the new joint venture agreement which amongst others that the defendant would reimburse the first plaintiff the sum of RM26,408 which was paid by the first plaintiff for conversion, drainage and irrigation fees, the sum of RM27,619.75 paid by the plaintiffs as quit rent and that the defendant deposited the sum of RM60,000 as a security for the completion of the new joint venture agreement. Apparently, the defendant did not agree to those proposals and the new joint venture agreement never came into being. As a result of that breakdown the solicitors for the plaintiffs issued a notice of demand dated 9 February 1983 claiming amongst others the reimburs