The court confirmed the enforceability of specific performance in contractual agreements when exercised within stipulated terms.

Introduction

[1] The Plaintiff's application for specific performance under O 81 r 1 of the Rules of 2012 (RoC 2012) was allowed by this Court. Aggrieved by the said decision, the Defendant filed this appeal.

Parties

[2] The Plaintiff is a private company incorporated in Malaysia under the provisions of the Companies Act 1965 with its registered address at Level 21, Menara MIDF, 82 Jalan Raja Chulan, 50200 Kuala Lumpur.

[3] The Defendant, Lim Thiam Chye, is an individual has an address for service at No 18-C, Jalan Glugor, Kampung Baru, 08000 Sungai Petani, Kedah Darul Aman and/or at No 8, Jalan Teratai 1/1, Amanjaya, 08000 Sungai Petani, Kedah Darul Aman.

Factual Background

[4] On 13 March 2007 the Plaintiff and a company known as BTS Holdings (M) Sdn Bhd (BHSB) entered into a Subscription Agreement (the Subscription Agreement). By the Subscription Agreement the Plaintiff agreed to subscribe for 500,000 redeemable convertible cumulative preference shares of RM1.00 each in the share capital of BHSB (the Subscription Shares) at a subscription price of RM10.00 only for each share and the total subscription price of RM5,000,000.00 (the Subscription Price) subject to the terms and conditions contained therein.

[5] Also on 13 March 2007 a Shareholders Agreement was entered into between the Plaintiff, BHSB, the Defendant and one Leong Soek Fun to, inter alia, regulate their relationship inter se as shareholders of BHSB. By way of a Supplemental Shareholders Agreement dated 15 April 2016, the parties agreed to amend, vary and/or alter certain terms of the Shareholders Agreement dated 13 March 2007 as set out therein. The Shareholders Agreement dated 13 March 2007 and the Supplemental Shareholders Agreement dated 15 April 2016 are hereinafter collectively referred to as "the Shareholders Agreements".

[6] The Plaintiff then subscribed for the Subscription Shares for the Subscription Price in accordance with the terms and conditions set out therein making the Plaintiff the legal and beneficial owner of the Subscription Shares.

[7] On or about 13 March 2007, the Plaintiff and the Defendant entered into a Put And Call Option Agreement (the Put and Call Option Agreement). The Put and Call Option Agreement provided, inter alia, as follows:

7.1 in consideration of the Plaintiff, at the request of the Defendant, entering into the Subscription Agreement with BHSB, the Defendant irrevocably granted to the Plaintiff a Put Option (as defined therein) to require the Defendant to purchase up to 500,000 redeemable convertible cumulative preference shares of RM1.00 each in BHSB held by the Plaintiff (the Option Shares) from the Plaintiff at the aggregate of the Subscription Price of RM5,000,000.00 and an additional 25% per annum of the Subscription Price (which is inclusive of the cumulative dividend of 10% per annum) (the Put Option Price) on the terms and conditions set out therein;

7.2 the Put Option may be exercised by the Plaintiff at any time during the Put Option Period (as defined therein) by serving a notice in writing on the Defendant (the Put Option Notice);

7.3 upon service of the Put Option Notice by the Plaintiff, the Defendant shall purchase from the Plaintiff, free from all liens, charges and other encumbrances in favour of the Plaintiff and with all rights attaching thereto, all the Option Shares specified in the Put Option Notice at the Put Option Price;

7.4 that upon the Put Option Notice being duly served on the Defendant, completion of the sale and purchase