Breach of Contract
Posted by snowie , Thursday, April 15, 2010 10:26 PM
Today, when I was browsing through the star online website, I found a news that is related to one of my subject which is Business Law. The news article titled: “Malaysian businessman sued for breach of contract”. – The Star Online, 14th April 2010
KUALA LUMPUR: A 49-year-old businesswoman from China is suing Tan Sri Ngan Ching Wen for breach of contract over an agreement which required the Malaysian business tycoon to pay her RM13mil for her efforts in a development project in Xi’an Qujiang, China.
Wang Yunzhen claimed that Ngan, who is the Unico-Desa Plantations Bhd executive chairman, did not fulfil the terms of the agreement after he managed to obtain the project approval from the Xi’an Qujiang authorities as a result from a joint effort with her.
She filed the suit via the firm Messrs Halim Hong & Quek at the High Court registry here at 9.30am on Wednesday.
Wang claimed that Ngan, 78, was interested in cooperating with her on the project, which she initiated and planned and had led her to sign the agreement on Feb 26, 2007.
Under the agreement, Ngan was to pay her RM13mil as remuneration for her cooperation and award her with 25% of the shares in a company called CM Xi’an Qujiang Properties (M) Sdn Bhd.
The company was also named as a co-defendant in the case.
Ngan was also supposed to appoint Wang as a deputy manager or director in the company where she would be given administrative authority.
Wang claimed that the agreement required Ngan to pay her a compensation of RM1mil should he fail to meet the terms of the contract.
She is seeking an order to carry out the agreement, general damages and other costs.
Wang was represented by lawyer Quek Ngee Meng.
There are four remedies for breach of contract:
a) Damages
b) Specific Performance
c) Injunction
d) Quantum Meruit
In this case, the remedy for the breach of contract is damages. RM13mil is the damages or compensation that required by the 49 year old businesswoman from China. She required the Malaysian business tycoon to pay her RM13mil for her efforts in a development project in Xi’an Qujiang, China.
Based on my understanding of the law of contract, as a general rule, performance of a contract must be exact and precise and should be accordance to with what the parties had promised. Section 38(1) of the Contracts Act 1950 provides that the parties to a contract must either perform or offer to perform their respective promises, unless such performance has been dispensed with by any law. In this case, Tan Sri Ngan did not perform his promises as stated in the agreement signed by both Ngan and Wang. Therefore, Wang appointed a lawyer to sue Ngan for the breach of contracts and seek for the compensation as promised in the agreement of RM13mil and other losses. This case is similar with the case of LIM YOH v. ASTANA STRATEGI (M) SDN. BHD. & ANOR[1998] 3 M.L.J 117, High Court.
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