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2020 MarsdenLR 1910
COURT OF APPEAL PUTRAJAYA
DELTA-PELITA SEBAKONG SDN BHD – Appellant
Versus
WONG HOU LIANQ & ORS AND OTHER APPEALS – Respondent
[Civil Appeal Nos: Q-02(NCVC)(W)-22-01-2018 Q-02(NCVC)(W)-90-01-2018 & Q-02(IM)(NCVC)-2001-09-2018]
The court reinforced contract validity principles while ruling wrongful termination led to enforceable claims for damages despite alleged breaches of fiduciary duties not being proven.
Headnote:(A) Companies Act 1965 – Sections 131 and 132 – Appeals from High Court regarding a maintenance agreement – Delta terminated the contract with Golden, which it contended was not validly done – Court found Golden was wrongfully terminated, and the agreement remains valid – All claimed amounts due to Golden were thus granted as reasonable and justified, with nominal damages awarded to Delta for its counterclaim – Breaches of fiduciary duties were not established against Neil Wong and Wong Kie Nai. (Paras 1, 18, 34 to 59)
Facts of the case: Golden Cash Harvest Sdn Bhd entered into a maintenance contract with Delta-Pelita Sebakong Sdn Bhd, which Delta later claimed to have wrongfully terminated. The parties argued over the interpretation of the contract's validity and the claims for damages arising from the termination.
Findings of Court: The court determined the evidence supported Golden's position that the termination was unlawful, validating the contract terms and granting claims to Golden while denying Delta's counterclaims.
Issues: The main issues included the validity of the contract, entitlements to damages by both parties, and breaches of fiduciary duties.
Ratio Decidendi: The court stated that clear evidence negated Delta's claims of contract termination and established that Golden was owed substantial amounts for services rendered. There was insufficient evidence to demonstrate breaches of fiduciary duties.
Result: Appeals dismissed in favor of Golden; counterclaims by Delta found unmeritorious.
[1] The three appeals listed above emanated from a single decision of the learned High Court Judge in respect of a claim filed by Golden Cash Harvest Sdn Bhd ("Golden") against Delta-Pelita Sebakong Sdn Bhd ("Delta") and a counterclaim by Delta against Golden, Wong Hou Lianq ("Neil Wong") and Kathryn Ma Wai Fong ("Kathryn Ma"). The claim of Golden was allowed but not for the full sum of RM14,541,214.91 as prayed whereas the counterclaim was only allowed in part and nominal damages of RM10,000.00 was ordered against the named co-defendants. Hence the filing of these two appeals by the respective aggrieved parties. Following the sequence of their filing, Delta's appeal is the first one listed whereas Golden's is the second one. The third appeal is a consequential one which flowed from the said decision and it is in respect of the assessment of the judgment sum ordered in favour of Golden which was done by the learned Deputy Registrar and heard on appeal, not by the learned High Court Judge who presided over the trial but by the learned Judicial Commissioner. Henceforth, in our judgment the first listed appeal would be referred to as Delta's appeal, the second as Golden's first appeal and the third as Golden's second appeal.
[2] As shown in the intitulement of the action, Kathryn Ma who is also the mother of Neil Wong, was sued in her capacity as the personal representative, executrix and trustee of the estate of the late Datuk Wong Kie Nai ("Wong Kie Nai") who was her husband and the father of Neil Wong. Wong Kie Nai was at the material time when the cause of action in the counterclaim arose, a director of Delta.
The Claim
[3] In gist, the claim is premised on these basic facts. Vide an agreement dated 8 April 2010 ("the agreement"), Delta appointed Golden to do maintenance works on its oil palm plantation which was situated on its two parcels of land described as Lot 24 and Lot 35, both at Mukah Land District and for a period of five years from the date thereof. That agreement was prepared by Messrs Stephen Robert & Wong Advocates. On 6 August 2013, Delta issued a letter to Golden informing it that "a new management team has been formed and will take over management of all affairs of the Company with effect from 16 August 2013" and Golden had to "hand over all matters to the Senior General Manager to ensure a smooth transition".
[4] Golden took this to mean that the agreement has been terminated and said so in its own letter to Delta dated 10 August 2013 and in the same letter Delta was put on notice that Golden would be moving out of the plantation on 16 August 2013. Move out it did with all its staff, labourers, workers, machineries and equipments but without Delta's presence inspite of the above mentioned notice. Delta, through Alan Nee Choong Sing (DW6) who was Senior General Manager (Plantation Operations & Finance) of WTK Management Services Sdn Bhd only came to the plantation the following day and found it deserted.
[5] Why that hard stand was taken by Golden although the agreement specifically states that it was for maintenance of the plantation was because, according to Golden, it had been managing the plantation since 1 March 2010 right down to the date of the impugned letter by Delta. That inaction on Delta's part was expected given that by a letter dated 14 August 2013 and in reply to Golden's letter of the 10 August 2013 as stated above, it, inter alia, had accused Golden of terminating the agreement without just cause and warned Neil Wong that he would be personally liable for all the losses and damages suffered by it, not just for the alleged breaches of the agreement but for a breach of his fiduciary duty to Delta. Golden therefore claimed the sum of RM14,541,214.91 being the amount due under the agreement, that is general damages for loss of contract fees from 16 August 2013 to 7 April 2015 (which is the balance of the contract period) as well as special damages, the particulars of whic
