JUDGMENT

Abdul Kadir Sulaiman JCA:

The Appeals

All these three appeals, Civil Appeal Nos. W-02-965-2001, W-02-964-2001 and W-02-90-2001 came up for hearing before us on 13 October 2003. With the consent of the parties it was decided that Civil Appeal No. W-02-965-2001 should be heard first and the decision in this appeal shall be binding on the other two appeals. This course was taken because the issues in both the appeals Nos. W-02-965-2001 and W-02-964-2001 have common features and raised common issues and also had identical pleadings. The issues raised in Civil Appeal No. W-02-90-2001 has also been raised in the other two appeals. A similar position was also taken in the High Court below where both cases were consolidated and it was decided that the decision in one case would bind the other case.

These three appeals before us has a historical significance. This panel of the Court of Appeal was the first panel constituted to sit in the new premises of the Court of Appeal in the Palace of Justice in Putrajaya. Hence these three appeals were the first substantive appeals to be heard before us. We had on 16 October 2003 dismissed all these three appeals with costs and we now give our reasons for doing so.

The material facts leading to these appeals before us had been marshalled with clarity by the trial judge in his judgment which was reported as Fortune Wealth (Hong Kong) Ltd v. Maju Holding Sdn Bhd [2002] 3 CLJ 329. In order to avoid wholesale repetition we will only refer to the brief facts of the case.

Brief Facts

The appellant and the respondent entered into a call and put option agreement dated 21 April 1997. Under the terms of this agreement the respondent had granted to the appellant during the call option period, the call option to require the respondent to sell and/or cause or procure the sale by the respondent to the appellant 1,646,000 shares in Ipmuda Berhad free from all restrictions and all other encumbrances at the completion date at the option price of RM7.55 per share. The call option action may be exercised by the appellant by serving an exercise notice on the respondent during the call option period defined in the agreement as a period of 12 months from the date of the agreement.

Under the terms of the agreement the appellant had also granted to the respondent during the put option period, the put option to require the appellant to purchase and/or cause the purchase by the appellant the 1,646,000 shares in Ipmuda Berhad free from all restrictions and all other encumbrances at the completion date at the option price of RM7.55 per share. As provided for in the agreement, the put option may be exercised by the respondent by serving an exercise notice on the appellant during the put option period which is a period of seven days commencing from the date of expiration of the call option period.

It is common ground that the appellant did not exercise the call option to purchase the 1,646,000 shares in Ipmuda Berhad when the call option period of 12 months had expired on 20 April 1998. The respondent then exercised its put option on 27 April 1998 by serving an exercise notice on the appellant requiring the appellant to purchase the 1,646,000 shares in Ipmuda Berhad at the total option price of RM12,427,300 based on the price of RM7.55 per share.

The respondent's exercise notice was dated 27 April 1997 and it was duly served on and acknowledged by the appellant at 5.35pm under the hand of Suzanna Abdul Rahman. This exercise notice made reference to the agreement dated 21 April 1997. The appellant did not respond at all to this exercise notice issued by the respondent. The respondent's solicitors then proceeded to serve a letter of demand dated 13 May 1998 upon the appellant demanding that the appellant purchase or cause to be purchased the option shares at the total option price of RM12,427,300. This letter of demand also made reference to the agreement dated 21 April 1997. The appellant again failed to respond to t