Dato Sri' Tan Hoe Beng v Lee Ean Lean (BA-12B-116-10/2024)

1.

ZCM MINERALS SDN BHD … APPELLANTS AND LEE EAN LEAN ... DEFENDANT (No. K/P: 541004-07-5447)

This is my judgment in respect of the appeal filed by the Appellants against the decision of the Sessions Court, Shah Alam, delivered on 15 October 2024, wherein the learned Sessions Court Judge entered judgment for the Plaintiff (now Respondent) in the sum of RM360,500.00 together with costs of RM10,000.00.

The Respondent’s claim in the Sessions Court concerned the alleged existence of three consultancy and project management contracts between him and the Appellants. The trial court held that the Plaintiff had adduced sufficient documentary and oral evidence to establish the existence of enforceable agreements, and that the Defendants failed to rebut such evidence.

Aggrieved, the Defendants filed this appeal, contending primarily that (i) no contract existed, written or otherwise; (ii) the email correspondence relied on by the Respondent was merely preliminary communication lacking essential terms required for contract formation; and (iii) the learned Sessions Court Judge erred in both fact and law in holding both Defendants jointly liable.

Having carefully considered the Records of Appeal, the parties’ submissions, and the authorities cited, I find no merit in the appeal. My reasons follow. A.

The Respondent is a consultant who claims to have been engaged by the Appellants for three separate work assignments between 2015 and 2018. The assignments, broadly summarised, are as follows:

Initial Assignment – RM75,000 Relating to consultancy work involving corporate structuring and documentation. The Respondent relied heavily on an email dated 18.8.2015 where the 1st Appellant allegedly offered consultancy duties at RM15,000 monthly.

(ii) Subsequent Assignment – RM229,500 Involving property and project management work at Teluk Cempedak and Bukit Pelindung. The Respondent referred to emails dated 12.1.2016 and 13.1.2016 as evidence of instructions and engagement.

(iii) Final Assignment – RM56,000 (RM8,000 x 7 months) Between September 2017 and June 2018, the Respondent claimed he was engaged to oversee various corporate matters and that he had been paid RM24,000 for three months, leaving RM56,000 unpaid.

The Respondent produced numerous documents including email correspondence, reports generated for the Appellants, EA forms, and bank statements evidencing payments received from the Appellants.

The Appellants maintained throughout the proceedings that no contract existed, written or verbal, and that any payments were ex gratia or unrelated to the alleged consultancy works.

After a full trial, the Sessions Court Judge allowed the Respondent’s claim in full, accepting that contracts existed for all three assignments and that the Appellants had breached their payment obligations. B. ISSUES FOR DETERMINATION The appeal raises the following issues: Issue 1 Whether the learned Sessions Court Judge erred in finding that there existed valid and enforceable contracts between the Respondent and the Appellants. Issue 2 Whether the Respondent had discharged the burden of proof in establishing the scope of work and entitlement to payment. Issue 3 Whether the Sessions Court erred in holding both Defendants jointly liable notwithstanding the principle of separate legal personality. Issue 4 Whether appellate intervention is warranted in light of the established standard of appellate review. I shall address these issues collectively where appropriate. C.

The Appellants submit that the trial court erred in concluding that the email correspondence constituted binding contracts. Their submissions may be summarised as follows:

No Clear Agreement / Uncertainty of Terms

It is argued that the emails relied on by the Respondent amounted only to preliminary discussions, lacking certainty as to scope, remuneration, deliverables, and duration. Essential terms were allegedly not agreed upon.

The Appellants rely on Petron Malaysia Refining & Marketing Bhd v Magna Enigma Sdn Bhd [2024] MLJU 1588 to argue that contracts must have consensus ad idem on all essential terms to be enforceable.

No Offer or Acceptance

It is contended that none of the emails evidenced unequivocal offer or acceptance as required under Sections 2(a) and 2(b) of the Contracts Act 1950.

Payments Were Not Evidence of a Contract

The Appellants state that payments made to the Respondent were for unrelated reasons and cannot be construed as acceptance of contractual obligations.

Corporate Separateness

It is further submitted that even if a contract existed, the 1st Appellant cannot be personally liable because the company, ZCM Minerals Sdn Bhd, is a separate legal entity. Reliance is placed on Semesta Insurance Underwriting Agency Sdn Bhd v Koperasi Insurance (M) Bhd [2011] 3 MLJ 379.

Sessions Court’s Factual Findings Were Wrong

The Appellants argue that the learned Judge failed to appreciate the evidence in full and improperly inferred contractual intention based on unchallenged documents. D.

The Respondent’s position, sustained through written and oral submissions, may be summarised as follows:

Existence of Implied or Oral Contracts

The Respondent asserts that Malaysian law recognises oral and implied contracts when conduct, correspondence, and actions demonstrate offer, acceptance, and consideration. Reliance is placed on Woon Kim Choy v Acexide Technology Sdn Bhd [2025] 1 MLRA 495.

Emails Contain Explicit Instructions

Emails relied upon are said to contain explicit requests for work, acknowledgement of services, and instructions for ongoing tasks. They are not preliminary negotiations but form part of a continuous and functioning working relationship.

Payments Confirm Contractual Relationship

Payments of RM24,000 and other transfers were made directly by the Appellants. The Respondent submits that such payments demonstrate acceptance of contractual obligations. d) Pleadings and Evidence Consistent

The Respondent argues that at trial, the Appellants never provided an alternative explanation as to why payments were made nor presented evidence rebutting the Respondent’s detailed documentary trail.

Sessions Court’s Findings Should Not Be Disturbed

The Respondent relies on Gan Yook Chin v Lee Ing Chin [2004] 4 CLJ 309, reminding the Court that appellate intervention is limited to instances where the lower court is plainly wrong. In this case, the Sessions Court’s findings are said to be fully supported by evidence. E.

I now turn to my analysis, having considered the Record of Appeal, the submissions of both parties, and the applicable legal principles.

Legal Principles

Under Sections 2 and 10 of the Contracts Act 1950, a contract may be written, oral, or implied through conduct. Malaysian law does not require a written document unless the statute mandates one. For a valid contract, four elements must exist: i) an offer (s.2(a)); ii) an acceptance (s.2(b)); iii) consideration (s.2(d)); and iv) an intention to create legal relations.

This reflects the longstanding principle that courts look at substance rather than form, particularly where parties have acted upon their communication.

The Respondent relies on Woon Kim Choy v Acexide Technology Sdn Bhd [2025] 1 MLRA 495, where the Court of Appeal affirmed that oral and implied contracts are enforceable if conduct and agreed expectations demonstrate contractual intention. The absence of a formal written agreement is not fatal where there exists: i) identifiable terms; ii) clear conduct demonstrating engagement; and iii) mutual performance.

The Appellants, however, rely on Petron Malaysia Refining & Marketing Bhd v Magna Enigma Sdn Bhd [2024] MLJU

That case emphasises the requirement of consensus ad idem, particularly where terms are unclear. Yet that case involved a situation where material terms were admittedly unsettled, and the parties were still negotiating fundamental obligations.

The distinction is critical: courts must examine all communications holistically, including subsequent conduct, to determine whether an agreement was actually reached.

Thus, the legal principles are well settled: i) Courts may infer contracts from conduct; ii) Emails can constitute offers and acceptances; iii) Certainty of terms is judged by “reasonable business efficacy,” not technical perfection.

(ii) Evidence of Offer and Acceptance

The emails dated 18.8.2015, 12.1.2016, 13.1.2016, and 7.8.2017 demonstrate specific instructions, scope of work, and confirmation of tasks. These were not hypothetical or exploratory discussions. The tone, content, and structure of the emails supported by attachments, instructions, follow-ups, and deadlines show operational exchanges rather than negotiations.

The Respondent’s evidence illustrates that he executed the instructions and updated the Appellants regularly. The Appellants’ silence or failure to object, in the face of performance, is relevant under s.7 of the Evidence Act as conduct inconsistent with their present position.

The Appellants presented no contrary evidence showing the emails were preliminary or conditional. In Perry v Suffields Ltd [1916] 2 Ch 187 the English courts held that conduct following communications may crystallise contractual intention, even when earlier communications were inconclusive.

Here, the Respondent not only acted but the Appellants benefited and even paid him. That is powerful evidence of acceptance.

(iii) Certainty of Terms

The Appellants contend that the terms were uncertain because there was: i) no signed agreement; ii) no definitive start dates; iii) no complete list of deliverables.

However, Malaysian law does not demand rigidity. Wisma Sime Darby Sdn Bhd v Wilson Parking (M) Sdn Bhd [1996] 4 CLJ 194 holds that courts will imply terms necessary to give business efficacy where the parties intended to be bound.

Further, Chow Mook Shing v Sai Chen Lai [2006] and Tindok Besar Estate v Tinjar Co [1979] 2 MLJ 229 confirm that contemporaneous documents carry great evidentiary weight. In this case: i) Work tasks were clearly articulated in emails; ii) Payments matched the agreed structure (e.g., RM8,000 monthly); iii) The Respondent produced project deliverables and reports. These facts satisfy the legal threshold for certainty.

The Appellants provided no alternative explanation for the payments made, nor did they identify which aspect of the terms was fatally uncertain. A contract is not void merely because the parties did not formalise it in a polished instrument.

(iv) Conduct of the Parties

The Respondent provided evidence of consistent performance reports delivered, project work undertaken, and email correspondence showing ongoing supervision and instruction by the Appellants. The Appellants’ conduct, including active engagement with the Respondent’s work and issuance of payments, strongly indicates that the relationship was structured, not casual.

Having considered all materials, I agree with the Sessions Court that enforceable contracts existed for all three assignments. The Appellants’ arguments were neither factually supported nor consistent with their own conduct.

The Respondent tendered extensive evidence: i) completed reports; ii) project communications; iii) financial documents; iv) EA forms; v) payment slips. These established a prima facie case of performance.

Under Sections 101 and 104 of the Evidence Act 1950, the burden shifted to the Appellants. However, they: i) tendered no contradictory documents; ii) gave no alternative narrative for the Respondent’s work; iii) failed to rebut performance with evidence. Their defence was bare denial.

The Sessions Court acted correctly in accepting the Respondent’s evidence and finding for him. The lower court did not err in law or appreciation of evidence.

The 1st Appellant asserts separate legal personality. While that doctrine is fundamental (Semesta Insurance [2011] 3 MLJ 379), the facts here justify rejecting his position: i) Emails were sent from his personal account; ii) Instructions came from him personally; iii) Some payments were made via his personal banking; iv) He never clarified in what capacity he was engaging the Respondent.

The Sessions Court held both Defendants jointly liable. This is a factual finding supported by evidence showing joint engagement.

While separate personality shields directors in many situations, it does not apply where the director personally contracts, makes representations, or plays an active individual role in the formation of obligations.

On the evidence, I find the 1st Appellant personally participated in creating and executing the agreements. His liability is therefore engaged.

In Gan Yook Chin v Lee Ing Chin [2004] 4 CLJ 309, the Federal Court reaffirmed the principle that appellate courts must not disturb factual findings unless they are "plainly wrong" or unsupported by evidence.

This Court cannot substitute its own view merely because another interpretation is possible. Intervention is permissible only where the lower court: i) ignored material evidence; ii) misapplied legal principles; or iii) drew conclusions no reasonable tribunal could reach.

The Sessions Court: i. carefully reviewed the documentary and oral evidence; ii. applied correct legal principles relating to contract formation; iii. provided reasoned findings supported by the evidential record.

There was no misdirection. The judgment is consistent with the weight of evidence, legally sound, and not plainly wrong. Thus, appellate interference is not justified. F.

The Respondent established: i) a valid contractual relationship, ii) performance of work, iii) entitlement to remuneration.

The Appellants failed to rebut the Respondent’s evidence, failed to provide alternative explanations for payments made, and relied largely on bare denials.

The Sessions Court’s findings are grounded in facts and settled legal principles. There is no basis for appellate interference.

For all the reasons stated above, the appeal is dismissed.

The judgment of the Sessions Court dated 14 October 2024 is hereby affirmed.

Costs of RM3,000.00 are awarded to the Respondent. Dated this 26th November 2025 -sgd- ………………………………….. Datin Asmah binti Musa Pesuruhjaya Kehakiman Mahkamah Tinggi Malaya Mahkamah Tinggi Shah Alam Counsel for Appellant : Mr. Cheok Swin Meng Messrs. Tan Norizan & Associates Counsel for Defendant: Mr. Paramjothy Pahavan (Ms. Sarainya with him) Messrs. P. Paramjothy & Co.