JUDGMENT

Ahmad Shahrir Mohd Salleh J:

Introduction

[1] This action arises from a commercial property transaction which has resulted in competing claims and counterclaims. The plaintiff seeks special damages amounting to RM1,178,300.00 for alleged renovation and replacement costs together with damages for late delivery of vacant possession totalling RM503,013.70. These claims stem from a sale and purchase agreement ("SPA") executed on 3 February 2021.

[2] The defendant disputes the plaintiff's claims and made a counterclaim for the apportioned outgoings in the sum of RM3,759.90 or alternatively, for damages to be assessed.

[3] Central to the dispute is the construction of the contractual terms governing the delivery of the property on an "as is where is" basis and whether the defendant has committed a breach of its obligations under the agreement.

Brief Background Of Facts

[4] The dispute concerns an industrial property erected on Lot 798, Batu 13, Jalan Balakong, Kawasan Perindustrian Balakong, Cheras, Selangor ("Property"). In the middle of October 2020, Yap Hoon Poh (PW3) arranged for representatives of the plaintiff to visit and inspect the Property. PW3 was a property agent. Following this, on 23 October 2020 the parties executed a Letter of Offer for the sale of the Property.

[5] The sale was expressly stated to be on an "as is where is" basis with vacant possession of the Property. In early February 2021, the parties formalised the transaction by executing a sale and purchase agreement ("SPA") for a total consideration of RM27,000,000.00. The Property had stood on the land for approximately 22 years. The transaction was a sub-sale and no inventory list was provided.

[6] Read together, Recital E and cl 2 of the SPA stipulate that the Property is sold on an "as is where is" basis with inclusion of one overhead hoist crane, tables located in seven penthouse rooms and fixtures affixed to the property. Clause 13.1 states that the defendant was in occupation of the Property and operating its business thereon at the time of agreement. Clause 13.2(a) requires the delivery of vacant possession of Part A and Part C of the Property not later than 17 May 2021. Such delivery is to be in the same state and condition as at the time of the purchaser's inspection. It further obliges the vendor at its own costs to remove all movable furniture and fittings, waste, debris and other items within the Property. Clauses 14A.1 and 14A.2 provide that any delay in delivery caused by reason of any governmental order, policy or directives, including Movement Control Orders, would constitute a force majeure event exempting the vendor from liability.

[7] Prior to the scheduled date of delivery, the plaintiff's solicitors issued a series of letters alleging that the defendant had unlawfully removed a substantial number of items from the Property. Between 12 May 2021 and 14 May 2021, three employees of the defendant tested positive for COVID-19. As a result, the defendant was compelled to cease operations temporarily to carry out sanitisation and quarantine measures in compliance with the Full Movement Control Order then in effect.

[8] On 17 May 2021, the defendant's solicitors delivered to the plaintiff's solicitors 323 pieces of keys and 5 remote controls pertaining to Part A and Part C of the Property. However, the following day the plaintiff's solicitors returned the said items without providing any explanation. Despite numerous attempts by the defendant's solicitors to facilitate the handover, the plaintiff's solicitors continued to reject acceptance of the keys. Eventually, on 13 July 2021 the keys were left at the office of the plaintiff's solicitors.

[9] The plaintiff only proceeded to inspect the Property on 9 August 2021. The plaintiff now contends that this date constitutes the actual date of delivery of vacant possession. The plaintiff's solicitors issued a demand seeking late delivery charges amounting to RM503,013.70 and damages for renovation and rep