JUDGMENT

Gan Techiong JC:

Introduction

[1] This appeal is all about the interpretation of a Service Agreement made between the parties. The Appellant/Plaintiff filed a Notice of Application pursuant to O 14A of the Rules of 2012 on 25th June 2024, raising 2 questions for determination. The learned Sessions Court judge answered those 2 questions and dismissed the Appellant's claim with costs. Hence, this appeal was filed by the Appellant/Plaintiff.

[2] After hearing submissions by learned counsel, I decided that this Court ought to dismiss the appeal as the learned Sessions Court judge had interpreted the clauses correctly. There is no appealable error.

Background Facts

[3] The Appellant is in the business of providing, inter alia, warehouse services.

[4] On 16th June 2023 the Appellant/Plaintiff and the Respondent/Defendant entered into a warehouse service agreement in which the Appellant as the service provider was to provide warehouse services as specified in Schedule III of the said agreement ("the Service Agreement") to the Respondent.

[5] Even though the Service Agreement was dated in June 2023, the contract term was stated to commence earlier, from 15th August 2022 to 31st December 2023 ("the Term").

[6] On 29th July 2023, the Respondent/Defendant issued a Notice of Termination to terminate the Service Agreement. Reliance was placed on cl 12.1 thereof, to be effective from 1st October 2023, ie by giving 60 days' notice.

[7] The Appellant disputed the termination, taking the position that the said cl 12.1 was inapplicable arguing that the Respondent could not terminate without cause under cl 12.1.

The Appellant's Interpretation Of Cl 12.1

[8] The Appellant reads cl 12.1 to be applicable only upon or subject to the occurrence of events stated under paragraphs (a) to (d) of cl 12.1.

[9] In other words, the Appellant contends that the Respondent does not have the right to unilaterally terminate the Service Agreement without cause by merely giving 60 days prior notice without the occurrence of any events as stipulated under cl 12.1 (a) to (d).

Analysis Of The Law And The Service Agreement

[10] It is trite that if the words used in a contract are clear, the courts must give effect to the ordinary meaning of those words. This was reiterated by the Federal Court in SPM Membrane Switch Sdn Bhd v. Kerajaan Negeri Selangor; [2016] 1 MLJ 464; [2016] 1 CLJ 177.

[11] And in cases of there being two competing interpretations, the Court should apply a commercial sense approach. In Catajaya Sdn Bhd v. Shoppoint Sdn Bhd & Ors; [2021] 2 MLJ 374; [2021] 3 CLJ 159, Hasnah Hashim FCJ (as the Rt. Hon. Chief Judge of Malaya then was) held as follows:

"[65] In interpreting a clause in an agreement it is pertinent to take into consideration the context of the agreement as a whole, to examine the relevant clauses in detail and to consider the relevant factual matrix to give guidance as to the true intent of the parties. When one has to choose between two rival interpretations, the one which made more commercial sense should be preferred if the natural meaning of the words were unclear. In this case the provisions of the SSA are clear and unambiguous.

Lord Hodge in Wood v. Capita Insurance Services Ltd [2017] UKSC 24 summarised the Court 's task in the construction of the terms of a contract:

10. The Court 's task is to ascertain the objective meaning of the language which the parties have chosen to express their agreement. It has long been accepted that this is not a literalist exercise focused solely on a parsing of the wording of the particular clause but that the Court must consider the contract as a whole and, depending on Catajaya Sdn Bhd v. Shoppoint Sdn Bhd & Ors; [2021] 2 MLJ 374; [2021] 3 CLJ 159 at 398 the nature, formality and quality of drafting of the contract, give more or less weight to elements of the wider context in reaching its view as to that objective meaning. In Prenn v. Simmonds [1971] 1 WLR 1381 (1383H-1385D) and in Reardon Smi