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2025 MarsdenLR 1935
HIGH COURT MALAYA KUALA LUMPUR
SKY BLUE MEDIA SDN BHD – Appellant
Versus
GOH SIN TECK – Respondent
[Suit No: WA-22NCC-568-12/2021]
Termination of contracts cannot be justified on grounds of impossibility of performance when the terminating party is aware of such impossibility and their conduct demonstrates waiver of rights.
Headnote:(A) Contracts Act 1950 - Termination of contracts - A Billboard Advertising Agreement was terminated unlawfully; SBM sought various reliefs related to the validity of the contract, damages, and loss of revenue - The court found that the defendant's termination was based on an impossible requirement - Goh's acceptance of a smaller billboard size demonstrated waiver of rights to claim breach. (Paras 1, 5, 6, 29, 71)
(B) Unlawful Termination - The court ruled that termination due to legal impossibility cannot stand; waiver through conduct established that the defendant had acquiesced to the smaller size requirements. (Paras 19, 34, 60)
(C) Misrepresentation - Misrepresentation by Goh regarding the legality of billboard dimensions vitiated his right to terminate the contract. (Paras 48, 53, 74)
(D) Force Majeure - The conditions imposed by DBKL constituted a force majeure, justifying the plaintiff's contract performance despite claims of breach. (Paras 61, 69)
Facts of the case:
The plaintiff claimed unlawful termination of a Billboard Advertising Agreement by the defendant, arising from the construction of a 60'x40' billboard instead of the contracted 60'x60'. The defendant argued the plaintiff's failure to comply with the size requirement justified termination. (Paras 1-4)
Findings of Court:
The court determined that the defendant's termination was unlawful; recognition of the impossibility of performance led to a dismissal of the counterclaim for losses. The plaintiff was granted declarations and compensation for damages sustained due to unlawful termination. (Paras 71, 76)
Issues: The court identified whether the termination of the Agreement by the defendant was lawful, particularly in light of the impossibility due to licensing regulations and conduct indicating waiver of rights. (Paras 5, 60)
Ratio Decidendi: The court reiterated that a party cannot terminate a contract for non-performance that was legally impossible, particularly when the terminating party had knowledge of such impossibility and had acted in a way that demonstrated waiver of rights. (Paras 34, 71)
Result: The termination of the Agreement was ruled unlawful; the plaintiff was awarded a declaration, damages, and costs. The defendant's counterclaim was dismissed.
| Table of Content |
|---|
| 1. unlawful termination of agreement (Para 1 , 2) |
| 2. reliefs sought by sbm (Para 3 , 4) |
| 3. core issue: legality of termination (Para 5) |
| 4. licensing and regulatory compliance (Para 6 , 7 , 8) |
| 5. credibility of witness testimony (Para 9 , 10 , 11 , 12) |
| 6. legality of 60'x60' billboard (Para 13 , 14) |
| 7. knowledge of goh concerning compliance (Para 15 , 16 , 17 , 18) |
| 8. waiver and conduct of goh (Para 19 , 20 , 21 , 22 , 23 , 24 , 25 , 26 , 27 , 28) |
| 9. effect of waiver on termination rights (Para 29 , 30 , 31 , 32 , 33 , 34) |
| 10. unproven dbkl letter defense (Para 35 , 36 , 37) |
| 11. misrepresentation claims (Para 38 , 39 , 40 , 41 , 42 , 43 , 44 , 45 , 46) |
| 12. misrepresentation impacts on termination (Para 47 , 48 , 49 , 50 , 51 , 52 , 53 , 54) |
| 13. timelines for performance of contract (Para 55 , 56 , 57 , 58 , 59) |
| 14. force majeure and its applicability (Para 60 , 61 , 62 , 63 , 64 , 65 , 66 , 67 , 68 , 69) |
| 15. dismissal of goh's counterclaim (Para 70 , 72 , 73 , 74 , 75) |
| 16. conclusion and reliefs awarded (Para 71) |
Introduction
[1] This is a claim by the Plaintiff, Sky Blue Media ("SBM") for an unlawful termination of Billboard Advertising Agreement ("the Agreement"). At the conclusion of the trial, I ruled that the Defendant's termination of the Agreement was unlawful and awarded damages to SBM. In so doing, I dismissed the Defendant's counterclaim.
The Claim
[2] SBM, a company involved in the provision of advertisement billboards, entered into an agreement to build a 60' wide x 60' tall LED billboard (60'x60' LED billboard) on a property purportedly belonging to the Defendant, Goh Sin Teck ("Goh"). In return, a revenue sharing arrangement between the two parties was agreed on. A LED billboard for a size of 60'x40' (60'x40' LED billboard) was however constructed by SBM. The Agreement signed on 19 September 2017 and a notice of termination by Goh issued on 28 August 2018. Goh then terminated the Agreement for alleged breach by SBM as SBM failed to deliver a 60' x 60' LED billboard. The LED billboard was thereafter brought down by the local authority, Dewan Bandaraya Kuala Lumpur ("DBKL").
[3] SBM contended that the Agreement was unlawfully terminated and sought the following reliefs:
a) a declaration that the notice of termination by Goh dated 28 August 2018 is false and/or unlawful;
b) a declaration that the Agreement remain valid and continuous;
c) an order for "specific performance" against Goh for the performance of the Agreement and to do all such actions necessary to re-establish the billboard on the site until the date of the auto-renewed extension;
d) an order to prevent the Goh from taking possession and/or interfere with the commercial use and/or use of billboard on the site in any way until the completion of this action and/or as the Court deems fit;
e) damages due to the removal and destruction of the billboard be assessed and paid by Goh;
f) damages for the loss of revenue of the billboard be assessed and paid by Goh;
g) alternatively, the order that the deposit of RM50,000.00 be returned to SBM; and/or
h) reimbursement of RM1,092,652.00 and all monies spent by SBM to perform the obligations in the Agreement.
i) general damages assessed by the Court;
j) further and/or alternatively indemnity for loss of revenue, goodwill assessed by the Court;
k) further and/or alternatively damages for economic duress;
l) general damages or sums assessed by this Court in respect of losses suffered by SBM as a result of the billboard's being removed and destroyed;
m) costs;
n) interest; and
o) such other further reliefs deemed appropriate and appropriate by the Court.
[4] Goh filed a counterclaim alleging that he suffered losses amounting to RM3,491,505.54 due to SBM's continuous and wrongful occupation on the billboard site.
The Issue
[5] There were several issues listed by the parties as issues to be tried. However, I am of the view that the sole issue to be determined is:
Whether The Termination Of The Agreement By Goh Was L
