The Plaintiff's claim against the Defendant were for damages arising from the failure on the part of the Defendant to renew the Licence Agreement entered into between the Plaintiff and the Defendant. The brief facts of the case are as follows. By virtue of a Licence Agreement dated 8.7.1991 "the Licence Agreement" the Defendant appointed the Plaintiff to manage and operate the Defendant's ESSO Petrol Service Station situated at 21/2 Mile, Jalan Kelang Lama, 58000 Kuala Lumpur [2] (the petrol station). According to the provisions of the Licence Agreement upon successful completion of one year probationary period the Plaintiff would be granted licence to manage and operate the petrol station for a further period of 5 years. Upon completion of this 5 year period the Defendant is given the option whether to allow the Plaintiff to continue to operate and manage the petrol station for another period of 5 years.

The Plaintiff had successfully completed the one year probationary period and therefore the Defendant allowed the Plaintiff to continue to manage and operate the petrol station for a further period of 5 years.

Upon the completion of this 5 year period the Defendant decided not to exercise its option to allow the Plaintiff to operate and manage the petrol station for another 5 years. Because of this refusal on the part of the Defendant to exercise its option the Plaintiff commenced this action against the Defendant claiming that the Defendant had committed a breach of the Licence Agreement. This led to [3] a full hearing with the Plaintiff calling 2 witnesses and the Defendant calling 3 witnesses. After having heard the evidence of the witnesses and the submissions by both Counsels I was of the view that the crux of this case was centred mainly on the interpretation of Clause 1(ii) of the Agreement which states the procedure for the renewal of the Licence. It reads as follows :-

"Upon completion of the probationary period or such extension(s) thereof to the satisfaction of the Company, the Company may in its sole and absolute discretion renew this Agreement for a further period of five (5) years, (or in the event the station is built on leasehold property, and the remaining unexpired period of the lease is less than 5 years, therefore such further period) commencing on the day after the completion of the probationary period as [4] aforesaid. Thereafter the Company shall have the option to renew the Agreement with the Licence for a further period of five (5) years on such renewed terms and conditions as may be mutually agreed upon or failing which on at least the same terms and conditions as are herein contained save for this clause and save for the licence fee which may be increased by the Company by a reasonable amount. The option herein referred to shall be exercised by the Company by notice in writing given at least (3) months prior to the expiration of the term of this Agreement."

Having considered this clause very carefully I made the following findings. Firstly, I found the Clause to be clearly worded and contained no ambiguity. Secondly, the option to [5] renew the licence for a second 5 year period is given to the Defendant. (In this Clause, the term "Company" refers to the Defendant and the term "Licencee" refers to the Plaintiff). The Clause does not give any option to the Plaintiff to further renew the Agreement. Thirdly, if the Defendant intends to renew the Agreement for a further period of 5 years, it would have to give prior 3 months' notice of such intention to the Plaintiff. It therefore means that the obligation on the part of the Defendant to give the 3 months' notice to the Plaintiff only arises if it decides to renew the agreement for a further period of 5 years. Conversely, if the Defendant does not intend to renew the Agreement it has no obligation to issue the 3 months' notice. In other words, under the terms of this Agreement, the Plaintiff is not given any option to renew the Agreement for a