JUDGMENT

Hishamudin Yunus J:

[1] This case was originally heard before Hashim Yusof J (as he then was). At the commencement of the hearing, before the trial could proceed the defence raised a preliminary objection. After hearing submissions, the learned judge dismissed the preliminary objection and ordered the case to proceed to trial.

[2] The case then was adjourned to another date for the trial. However, before the trial date, Hashim Yusof J was transferred to another court. When I subsequently took over conduct of this case on 24 December 2003, it was agreed by parties that I should hear this case de novo.

[3] The plaintiff in the present case is a company duly appointed as an agent by the registered proprietors of a building known as 'Wisma SCA' to rent out, collect rent and manage the said building.

[4] The defendant is a private educational institution running a private college at Wisma Sim Lim in or about early 1988, and was considering alternative premises for its private college.

[5] The defendant intimated to the plaintiff that it was interested to rent Wisma SCA to be used as its private college. There was a meeting between the representatives of both sides. On 12 February 1988 the plaintiff issued a letter of offer setting out the terms of which the plaintiff was willing to rent out the 2nd floor of Wisma SCA. On 1 April 1988 the defendant moved in into the 2nd floor of Wisma SCA. But at that stage the formal tenancy agreement was yet to be finalized. However, in principle parties were in agreement that the monthly rentals were to comprise of two elements (or components), namely:

(1) The basic rental; and

(2) The commission rental.

[6] The parties were in agreement as to the amount of the monthly basic rental. The parties also were able to agree that the monthly commission rental was to be linked to the gross monthly revenue of the defendant. But parties found it difficult to agree on the formula to be used to compute the monthly commission rental. So the parties carried out negotiations to work out a formula that would be acceptable to both sides. On 27 June 1989 (do note that this is more than a year after the defendant had occupied the 2nd floor of Wisma SCA). The plaintiff forwarded a copy of the draft tenancy agreement to the defendant. On 22 September 1989, the defendant's solicitors returned the draft tenancy agreement to the plaintiff with amendments. While parties were still in the midst of negotiating to arrive at an agreed formula for determining the monthly commission rental, the plaintiff, on 19 August 1989, wrote to the defendant offering the renting of the 3rd floor in the terms as set out in the letter the defendant accepted the offer and on 1 November 1989, the defendant occupied the 3rd floor of Wisma SCA. But the parties were yet to arrive at an agreed formula on the computation of the monthly commission rental. On 23 February 1990, the plaintiff wrote to the defendant setting out the terms of offer for the rental of the 3rd floor Then on 24 April 1990 the defendant's solicitors wrote to the plaintiff's solicitors asking whether the plaintiff intended to continue with the tenancy. There was no response from the plaintiff. So on 16 July 1990, the defendant's solicitors wrote to the plaintiff's solicitors asking whether the plaintiff intends to execute the tenancy agreement. Again there was no response. Finally on 16 March 1991, the defendant served a notice to the plaintiff terminating the renting of Wisma SCA with effect from 15 April 1991. On 15 April 1991, the defendant vacated the premises.

[7] In this writ action, the plaintiff claims against the defendant for an alleged breach of a tenancy agreement between the parties for the rental of the 2nd and 3rd floors of Wisma SCA. The plaintiff, in the present case, takes the position that although the parties never entered into a formal tenancy agreement, nevertheless, there exists a written tenancy agreement between the plaintiff and the defendant. From the