Court DecisionMY-HC

WA-22NCvC-656-11/2023

Oishii Wasabi Sdn Bhd v Topz Sdn Bhd (WA-22NCvC-656-11/2023)

High Court of Malaysia30 Apr 2026

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[1] This commercial tenancy dispute between Oishii Wasabi Sdn Bhd (the Tenant) and Topz Sdn Bhd (the Landlord) centers on whether the Landlord fulfilled specific conditions regarding the physical state of the premises before the tenancy was to commence. The premises in this case is a shop lot with an address at No. 1, Jalan SS15/4E, 47500 Subang Jaya, Selangor. [2] The Landlord’s suit against the Tenant (Suit 336) is for losses of RM1,295,000.00 with 8% interest calculated daily from 1.11.2022 until full and final settlement, this Court’s declaration that he is entitled to forfeit RM129,500.00 deposit paid by the Tenant, and costs. [3] The Tenant’s suit (and also its directors (the Guarantors)) is for the opposite - declarations that the Tenancy Agreement has been validly terminated by it on 16.11.2022 and consequently the Personal Guarantees and Indemnities, the return of the deposit of RM166,500.00, damages, aggravated damages, interests and costs. [4] Both Suit 336 and Suit 656 were jointly heard. It was a one-day trial with the Landlord calling its former legal solicitor who had prepared and revised the Tenancy Agreement and its director. While the Tenant call its two directors (Guarantors) who had executed the Personal Guarantees and Indemnities; who are named as litigants in this case. The Tenant’s Core Arguments [5] The Tenant, along with its directors (the Guarantors), argues that the Tenancy Agreement was contingent upon several oral agreements and conditions precedent. The Tenant claims the Landlord agreed during meetings on 5.9.2022 and 3.10.2022 to deliver the premises in a specific physical state. This included removing external glass panels, making the exterior façade bare, and covering up any resulting cavities or holes at the Landlord’s expense. [6] It contends that because these works were not completed, the premises remained unsuitable for their business operations. The Tenant argues the Landlord unilaterally fixed the commencement date as 1.10.2022 without fulfilling its obligations, The Tenant also alleges the Landlord backdated the agreement from its actual execution date (5.9.2022) to 29.9.2022 to justify this commencement date. [7] Based on these alleged breaches, the Tenant maintains it validly terminated the agreement on 16.11.2022 and is entitled to a full refund of its RM166,500.00 deposit and advance rental. The Landlord’s Core Arguments [8] The Landlord denies the existing of binding oral agreements and relies strictly on the terms of the written Tenancy Agreement. The Landlord asserts that the written contract, which both parties signed, contains no mention of the alleged oral conditions. Under the parole evidence rule, it argues that evidence of such oral negotiations is inadmissible to vary the written terms. [9] The Landlord points to clause in the agreement stating the premises were to be taken on an “as is where is” basis as of the commencement date. It argues that Clause 1.1 gives the Landlord the sole discretion to determine the commencement date, and there was nothing irregular about fixing for 1.10.2022. [10] The Landlord claims they only agreed to remove a portion of the facade on a goodwill basis to accommodate the Tenant’s signage, and this did not constitute a contractual obligation to restore the entire façade to a bare state. It contends that the Tenant’s refusal to accept vacant possession and its subsequent notice of termination were wrongful and constituted a breach of contract. Due to the breach, the Landlord claims they are entitled to forfeit the deposits and recover the full rental for the unexpired 35-month term totaling RM1,295,000.00. The Landlord maintains that the Tenant’s directors are personally and jointly liable for these sums as principal debtors under the signed Guarantee and Indemnities. Factual Matrix [11] The Tenancy Agreement is a written agreement purportedly dated 29.9.2022 for a term of three years. While the document is dated so, evidence shows that it was executed by the Tenant’s directors on 5.9.2022. The Tenant’s directors also signed Personal Guarantees and Indemnities dated 29.9.2022, where they agreed to be liable as principal debtors for the Tenant’s obligations. [12] Clauses 1 and 1.1 of the Tenancy Agreement expressly state that the Tenant accepts the premises in its current state as of the commencement date. Clause 6 of the Tenancy Agreement states that the written document constitutes the entire agreement and supersedes all previous undertakings. [13] The Tenant paid a total of RM166,500.00 on 5.9.2022 which included a RM111,000.00 as security deposit, a RM18,500.00 utility deposit, and RM37,000.00 advance rental for October 2022. [14] The Landlord is claiming RM1,295,000.00 representing the full rental for the remaining 35 months of the unexpired term. It also claims interest at 8% per annum on outstanding sums, as provided in Clause 4(b)(i) of the Tenancy Agreement. [15] Photographs from 7.10.2022 attached to the Landlord’s letter show that two rows of glass panels had been removed from the exterior façade by 1.10.2022. Photographs purported taken by the Tenant on 3.10.2022 were introduced to argue that the façade was not yet in the agreed bare condition. The Tenant attempted to adduce evidence during trial that suggests the previous tenant, Donutes Coffee & Bakery (“Donutes”), paid the Landlord RM300,000.00 to restore the premises to its original condition, which the Tenant argues should have been used to fulfill the Landlord’s alleged work obligations. This piece of evidence was objected to by the Landlord as inadmissible on the grounds of hearsay and irrelevant. [16] The Tenant relies on discussions held during meetings on 5.9.2022 and 3.10.2022 where it claims the Landlord’s representative named Ms. Koh agreed to remove all external glass panels and cover wall cavities at the Landlord’s expense. Both parties finalized negotiations and executed the primary contractual documents for the tenancy. The Landlord’s legal counsel was present. and he had handled the preparation and revision of the contract documents. The Landlord’s director was not present during this meeting where the Tenant executed the Tenancy Agreement on this date. [17] The discussions at the 5.9.2022 meeting when in the end the Tenant executed the Tenancy Agreements, included the bare condition issue. The Tenant repeatedly emphasized that it was essential for the premises, particularly the exterior façade, to be delivered in a bare condition. It was allegedly discussed and agreed that the Landlord would, at its own expense, remove external glass panels and cover up cavities or holes in the outer wall of the first floor. [18] The parties discussed that the interior would be undertaken on an “as is where is” basis, but the Landlord granted the Tenant permission to coordinate directly with the outgoing tenant (Donutes) regarding the interior state before their term ended on 30.9.2022. The Tenant offered a monthly rental of RM37,000.00 which Landlord accepted on the condition that the deposits were paid immediately. The Landlord’s legal counsel through his testimony at trial, confirmed that he drafted and revised the Tenancy Agreement at the meeting. He testified he was not aware of any oral agreements that were meant to be included in the final written contract. He explained that while the Tenancy Agreement was executed on this date - 5.9.2022, it was dated 29.9.2022 to avoid stamp duty penalties for the Tenant. [19] This meeting on 5.9.2022 resulted in several significant resolution and actions. The Tenant’s directors (Guarantors) executed the Tenancy Agreement for the Tenant, which had been revised by the Landlord’s legal counsel during the meeting to reflect the parties’ discussions. The Tenant’s directors (Guarantors) had also signed the Personal Guarantees and Indemnities agreeing to be personally liable as principal debtors for the Tenant’s obligations. The Tenant made an immediate payment of RM166,500.00, which covered the security deposit, utility deposit, and advance rental for the first month. [20] Both the directors (Guarantors) of the Tenant admitted during cross-examination that they read and understood the terms of the Tenancy Agreement and the Personal Guarantees before signing of the same. All the witnesses for both parties admitted that the specific obligations regarding the exterior facade and wall cavities were not written in the agreed Tenancy Agreement. [21] The Meeting on 3.10.2022 was arranged to resolve the Tenant’s dissatisfaction regarding the physical state of the premises, specifically the exterior façade. Ms. Koh again attended the meeting as representative for the Landlord. The representative of Donutes was also in attendance, whom the Tenant’s directors (Guarantors) claimed had informed them that Donutes had paid the Landlord an estimated RM300,000.00 for restoration works. The Landlord’s legal counsel was present. This time the Tenant’s trial counsel - the lawyer on record conducting the examination of witnesses was also present. [22] At this meeting, the Landlord informed Donutes that they were obligated to return the premises in a condition acceptable to the Landlord before possession could be delivered to the Tenant. According to the Tenant, the meeting concluded with the Landlord agreeing to remove the external glass panels, cover up the wall cavities on the first floor, and take photographs of the façade to establish its bare state and avoid future disputes. The Tenant requested a written confirmation letter to document these oral promises. Such document never came to fruition. [23] Four days after this meeting, the Landlord issued a letter dated 7.10.2022 fixing the commencement date of the Tenancy Agreement as 1.10.2022. The Landlord claimed this was within its sole discretion under Clause 1.1 of the Tenancy Agreement. [24] The Landlord contends there was a follow-up meeting on 7.10.2022 intended to resolve ongoing disputes regarding the physical state of the premises before the Tenant would accept vacant possession. The meeting was held at the premises attended by the Tenant’s director and the Landlord’s legal counsel were present. However, the Landlord’s legal counsel testified multiple times during cross-examination that he could not recall a physical meeting taking place on that specific date. He could not confirm that he personally showed the Tenant that the wall cavities had been covered. [25] The Landlord’s solicitor admitted he was aware of the existence of a dispute between the parties which arose after the Tenancy Agreement was signed concerning an alleged oral agreement regarding the premises’ condition. He clarified that while there were negotiations regarding what the Tenant purportedly stated existed, he was not aware of any binding oral agreement that formed part of the Tenancy Agreement itself. He maintained that any work done (such as partial removal) was simply the state of the premises on an “as is where is” basis as of the commencement date. [26] The “as is where is” basis is also embedded undisputedly in the Tenancy Agreement. The Landlord’s director testified that he only agreed to remove part of the façade as a goodwill gesture to help the Tenant install its signage, not as a contractual obligation. He also testified that as the owner, he had the absolute right to beautify the building’s façade and that the Tenant had no authority to dictate how that work was done or how it was funded. He stated that he had already beautified the façade to allow for the signboard and that the Tenant’s refusal to accept possession despite these efforts was a breach of contract. [27] The Notice of Termination was issued by the Tenant on 16.11.2022 citing the Landlord’s failure to fulfill the alleged oral conditions. It is undisputed that the Tenant never accepted the keys or took physical possession of the premises. This Court’s Analysis [28] Regarding the RM300,000.00 claim: the Tenant argued that this payment was specifically intended for the restoration of the exterior façade and the covering of wall cavities. The Tenant contended that since the Landlord had received these funds from the outgoing tenant, the Landlord was contractually (or via oral agreement) bound to utilize that money to deliver the premises in the bare conditions as orally promised to the Tenant. [29] The Landlord countered this claim from a few angles. The Landlord’s counsel objected to the testimony of the Tenant’s directors (Guarantors) regarding the payment, having labeled it as inadmissible hearsay because the details of the arrangement between the Landlord and Donutes were being introduced by the Tenant’s witnesses rather than a direct party to that specific agreement. [30] Additionally, the Landlord argued that the RM300,000.00 payment was not included in the Tenant’s original pleadings (Statement of Claim (SoC) or Defence to the Counterclaim) and therefore should be disregarded by this Court. The Landlord maintained that any financial settlement between it and a third party (Donutes) was a private matter that had no legal bearing on the written Tenancy Agreement with the Tenant, which required the Tenant to accept the premises on as “as is where is” basis. [31] This Court’s analysis on this RM300,000.00 restoration claim centers on three primary deficiencies. Firstly, it is dangerous to accept the evidence of the RM300,000.00 payment because it remained hearsay throughout the trial. DW1 and DW2 testified that they were informed during a meeting on 3.10.2022 that the previous tenant, Donutes, had paid this sum to the Landlord for restoration. Neither Ms Koh nor a representative from Donutes was called to testify and verify the payment or its specific purpose. So, the evidence lacked the necessary foundation for this Court to rely upon it as a fact. See the Supreme Court’s decision in Guthrie Sdn Bhd v Trans-Malaysian Leasing Corp Bhd [1991] 1 MLJ 33 at p35, and the Federal Court case of Tengku Dato’ Ibrahim Petra bin Tengku Indra Petra v Petra Perdana Bhd and another appeal [2018] 2 MLJ 177 at p206-207. [32] Secondly, even is such payment existed, it was legally irrelevant to the specific rights and obligations defined in the Tenancy Agreement between the Landlord and the Tenant. Any financial settlement between the Landlord and its former tenant (Donutes) was a private matter totally not related to the current Tenancy Agreement of the Personal Guarantees and Indemnities. Under the parole evidence rule of sections 91 and 90 of the Evidence Act 1950 (EA) the written agreement is the best evidence of the parties’ intentions. [33] A critical procedural barrier for the Tenant is that the RM300,000.00 claim was not part of the Tenant’s pleaded case (either in its Defence or its SoC). This Court accepts the Landlord’s objection that parties are strictly. Bound by their pleadings. The Tenant did not specifically plead the RM300,000.00 payment as a material fact or condition for performance. See Superintendent of Lands and Surveys (4th Div) & Anor v Hamit Bin Matusin & Ors [1994] 3 MLJ 185 and affirmed by the Federal Court in Iftikar Ahmed Khan (as the executor of the estate for Sardar Mohd Roshan Khan, deceased) v Perwira Affin Bank Berhad (previously known as Perwira Habib Bank Malaysia Bhd) [2018] 2 MLJ 292. [34] On the condition of the ‘as is where is’ basis and the condition of the premises, this Court’s reference is Clause 1 of the Tenancy Agreement that states: “The Landlord agrees to let and the Tenant agrees to take a tenancy of the Demised Premises ‘as is where is’ for a fixed term stated in Section 5 of the First Schedule thereto..” [35] This requirement is further solidified in the concluding sentence of Clause 1.1 of the Tenancy Agreement which stipulates: “Parties agree that the Landlord … is only required to deliver the vacant possession of the demise premises as is where is on the commencement date.” [36] This Court noted that the Tenant contended that during meeting on 5.9.2022 and 3.10.2022, oral representations were made by the Landlord’s staff promising to remove the entirety of the exterior façade and cover wall cavities. However, while the meetings had taken place, the said resolved negotiated terms were not incorporated into the final signed Tenancy Agreement. In fact, the Landlord’s counsel’s testimony that he was not aware of anything other than what was stated in the Tenancy Agreement at the material time, remains unshaken. [37] During the cross-examination of both the Tenant’s directors (Guarantors), they admitted that the written Tenancy Agreement they signed did not contain any terms regarding the removal of the façade covering the wall cavities. Furthermore, they concede that they did not request their lawyers to include these purported oral promises into the written contract or any supplemental agreement. [38] Under the parole evidence rule as codified in section 90 and 91 of EA, when the terms of a contract have been reduced to a written document, no extrinsic evidence is admissible to contradict, vary, add to, or subtract from those written terms. This Court relies on the established principles of:
Binding nature of the signed contracts which is a general principle of law that a party who signs a written contract is bound by its terms, regardless of whether they have read or understood them. This was established in the leading case of L’Estrange v F Graucob Ltd [1934] 2 KB 394, Polygram Records Sdn Bhd v The Search & Anor [1994] 3 MLJ 127 and Wee Lian Construction Sdn Bhd v Ingersoll-Jati Malaysia Sdn Bhd [2010] 3 MLJ 425.
The primacy of the written word as ruled by the Court of Appeal in Syarikat Binaan Utara Jaya v Koperasi Serbaguna Sungai Gelugor Bhd [2009] 1 CLJ 786. It held that where the language of a document is clear and unambiguous, its nature is to be determined solely by looking at its contents, uninfluenced by any alleged prior intentions.
The Entire Agreement Clause which is contained in the Tenancy Agreement - Clause 6 expressly states that the document constitutes the entire agreement between the parties supersede any previous agreement or understanding. As noted in Master Strike Sdn Bhd v Sterling Heights Sdn Bhd [2005] 2 CLJ 596, such a clause precludes parties from relying on collateral warranties or assurances made during negotiations.
Oral evidence cannot be used to impose additional obligations such as façade restorations, that would contradict the ‘as is where is’ delivery term found in the written contract. It was emphasized in United Overseas Bank (China) Limited, Chengdu Branch v. Siow Kwang Joon @ Siow Kwong Shang [2024] MLJU 507 that the absence of a written term means the formal agreement is silent, and oral collateral agreements that are inconsistent with the formal terms cannot be permitted. See Seven Seas Industries Sdn Bhd v Philips Electronic Supplies (M) Sdn Bhd & Anor [2008] 5 MLJ 157; Bank Pertanian Malaysia Berhad v. Fiskal Fantasi Sdn Bhd and Anor [2011] CLJU 678. [39] In light of the clear and unambiguous wording of Clause 1.1, this Court finds that the Landlord’s only obligation was to deliver the premises in its existing state as of the commencement date. Ten Tenant’s reliance on purported oral agreements is legally unsustainable as these terms were never reflected in the written and executed Tenancy Agreement and are prohibited by the parole evidence rule. [40] This Court rules that the Tenant was contractually bound to accept the premises on an ‘as is where is’ basis as of the commencement date, regardless of how the Landlord funded any beautification works. [41] The commencement date matter that arose when the Landlord’s letter of 7.10.2022 to the Tenant stated that it exercised its discretion under Clause 1.1 of the Tenancy Agreement and determined 1.10.2022 as the commencement date for the purpose of the tenancy. The letter stressed that this date applied regardless of when the Tenant actually collected the keys. [42] The primary authority for determining the start of the tenancy is found in Clause 1.1 of the Tenancy Agreement that states with clarity: “The tenancy contemplated herein shall commence on such date to be determined by the Landlord at the reasonable discretion of the Landlord … “ [43] Evidence borne at trial shows that both the directors (Guarantors) of the Tenant confirmed that they had respectively read and understood the terms of the Tenancy Agreement before signing, particularly this contractual power vested in the Landlord. Accordingly, this Court rules in favour of the Landlord on the issue of the commencement date. The Landlord possessed the sole discretionary power to determine the date, and its exercise of that power was valid under the Tenancy Agreement. [44] Consequent to this ruling, the Tenant’s termination is found to be invalid and constitutes a material breach of the Tenancy Agreement.
Suit 336 is allowed
Suit 656 is dismissed
The Tenants and the Guarantors are jointly and severally ordered to pay the Landlord the sum of RM1,295,000.00, representing the outstanding rental for the unexpired term of the tenancy
Late payment interest is awarded on the sum of RM1,295,000.00 at the rate of 8% per year, calculated on daily rest from 1.11.2022 until the date of full settlement
A declaration is granted that the security and utility deposits totaling RM129,500.00 are absolutely forfeited to the Landlord
The Personal Guarantees and Indemnities executed by the Guarantors (the Tenant’s directors) are declared valid and binding
Costs are awarded to the Landlord in the sum of RM55,000.00, subject to allocator. DATED 30 APRIL 2026 ROZ MAWAR ROZAIN JUDGE HIGH COURT OF MALAYA KUALA LUMPUR For the Plaintiff (suit 336) & Defendants (suit 656): Peter Neik Xiang Cheng together with Jazz Cheah Jeay Ying Neik & Partners (Petaling Jaya) For the Defendants (suit 336) & Plaintiff (suit 656): Tey Hoo Nee Chai & Company (Kuala Lumpur)

Content

1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR CIVIL SUIT NO: WA-22NCVC-336-06/2023 BETWEEN TOPZ SDN BHD [COMPANY NO.: 200801040408 (841759-U)] … PLAINTIFF

And

OISHII WASABI SDN BHD [COMPANY NO.: 20210107442 (1417742-P)]

TAN DEE HON [NRIC NO.: 880320-14-5187]

TAN LEE TING [NRIC.No: 830705-14-5254] … DEFENDANTS JOINTLY HEARD WITH 05/05/2026 12:25:42 WA-22NCvC-656-11/2023 Kand. 47 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR CIVIL SUIT NO: WA-22NCVC-656-11/2023

Between

OISHII WASABI SDN BHD [COMPANY NO.: 20210107442 (1417742-P)]

TAN DEE HON [NRIC NO.: 880320-14-5187]

TAN LEE TING [NRIC.No: 830705-14-5254] … PLAINTIFFS AND TOPZ SDN BHD [COMPANY NO.: 200801040408 (841759-U)] … DEFENDANT

Decision

para

[1] This commercial tenancy dispute between Oishii Wasabi Sdn Bhd (the Tenant) and Topz Sdn Bhd (the Landlord) centers on whether the Landlord fulfilled specific conditions regarding the physical state of the premises before the tenancy was to commence. The premises in this case is a shop lot with an address at No. 1, Jalan SS15/4E, 47500 Subang Jaya, Selangor. [2] The Landlord’s suit against the Tenant (Suit 336) is for losses of RM1,295,000.00 with 8% interest calculated daily from 1.11.2022 until full and final settlement, this Court’s declaration that he is entitled to forfeit RM129,500.00 deposit paid by the Tenant, and costs. [3] The Tenant’s suit (and also its directors (the Guarantors)) is for the opposite - declarations that the Tenancy Agreement has been validly terminated by it on 16.11.2022 and consequently the Personal Guarantees and Indemnities, the return of the deposit of RM166,500.00, damages, aggravated damages, interests and costs. [4] Both Suit 336 and Suit 656 were jointly heard. It was a one-day trial with the Landlord calling its former legal solicitor who had prepared and revised the Tenancy Agreement and its director. While the Tenant call its two directors (Guarantors) who had executed the Personal Guarantees and Indemnities; who are named as litigants in this case. The Tenant’s Core Arguments [5] The Tenant, along with its directors (the Guarantors), argues that the Tenancy Agreement was contingent upon several oral agreements and conditions precedent. The Tenant claims the Landlord agreed during meetings on 5.9.2022 and 3.10.2022 to deliver the premises in a specific physical state. This included removing external glass panels, making the exterior façade bare, and covering up any resulting cavities or holes at the Landlord’s expense. [6] It contends that because these works were not completed, the premises remained unsuitable for their business operations. The Tenant argues the Landlord unilaterally fixed the commencement date as 1.10.2022 without fulfilling its obligations, The Tenant also alleges the Landlord backdated the agreement from its actual execution date (5.9.2022) to 29.9.2022 to justify this commencement date. [7] Based on these alleged breaches, the Tenant maintains it validly terminated the agreement on 16.11.2022 and is entitled to a full refund of its RM166,500.00 deposit and advance rental. The Landlord’s Core Arguments [8] The Landlord denies the existing of binding oral agreements and relies strictly on the terms of the written Tenancy Agreement. The Landlord asserts that the written contract, which both parties signed, contains no mention of the alleged oral conditions. Under the parole evidence rule, it argues that evidence of such oral negotiations is inadmissible to vary the written terms. [9] The Landlord points to clause in the agreement stating the premises were to be taken on an “as is where is” basis as of the commencement date. It argues that Clause 1.1 gives the Landlord the sole discretion to determine the commencement date, and there was nothing irregular about fixing for 1.10.2022. [10] The Landlord claims they only agreed to remove a portion of the facade on a goodwill basis to accommodate the Tenant’s signage, and this did not constitute a contractual obligation to restore the entire façade to a bare state. It contends that the Tenant’s refusal to accept vacant possession and its subsequent notice of termination were wrongful and constituted a breach of contract. Due to the breach, the Landlord claims they are entitled to forfeit the deposits and recover the full rental for the unexpired 35-month term totaling RM1,295,000.00. The Landlord maintains that the Tenant’s directors are personally and jointly liable for these sums as principal debtors under the signed Guarantee and Indemnities. Factual Matrix [11] The Tenancy Agreement is a written agreement purportedly dated 29.9.2022 for a term of three years. While the document is dated so, evidence shows that it was executed by the Tenant’s directors on 5.9.2022. The Tenant’s directors also signed Personal Guarantees and Indemnities dated 29.9.2022, where they agreed to be liable as principal debtors for the Tenant’s obligations. [12] Clauses 1 and 1.1 of the Tenancy Agreement expressly state that the Tenant accepts the premises in its current state as of the commencement date. Clause 6 of the Tenancy Agreement states that the written document constitutes the entire agreement and supersedes all previous undertakings. [13] The Tenant paid a total of RM166,500.00 on 5.9.2022 which included a RM111,000.00 as security deposit, a RM18,500.00 utility deposit, and RM37,000.00 advance rental for October 2022. [14] The Landlord is claiming RM1,295,000.00 representing the full rental for the remaining 35 months of the unexpired term. It also claims interest at 8% per annum on outstanding sums, as provided in Clause 4(b)(i) of the Tenancy Agreement. [15] Photographs from 7.10.2022 attached to the Landlord’s letter show that two rows of glass panels had been removed from the exterior façade by 1.10.2022. Photographs purported taken by the Tenant on 3.10.2022 were introduced to argue that the façade was not yet in the agreed bare condition. The Tenant attempted to adduce evidence during trial that suggests the previous tenant, Donutes Coffee & Bakery (“Donutes”), paid the Landlord RM300,000.00 to restore the premises to its original condition, which the Tenant argues should have been used to fulfill the Landlord’s alleged work obligations. This piece of evidence was objected to by the Landlord as inadmissible on the grounds of hearsay and irrelevant. [16] The Tenant relies on discussions held during meetings on 5.9.2022 and 3.10.2022 where it claims the Landlord’s representative named Ms. Koh agreed to remove all external glass panels and cover wall cavities at the Landlord’s expense. Both parties finalized negotiations and executed the primary contractual documents for the tenancy. The Landlord’s legal counsel was present. and he had handled the preparation and revision of the contract documents. The Landlord’s director was not present during this meeting where the Tenant executed the Tenancy Agreement on this date. [17] The discussions at the 5.9.2022 meeting when in the end the Tenant executed the Tenancy Agreements, included the bare condition issue. The Tenant repeatedly emphasized that it was essential for the premises, particularly the exterior façade, to be delivered in a bare condition. It was allegedly discussed and agreed that the Landlord would, at its own expense, remove external glass panels and cover up cavities or holes in the outer wall of the first floor. [18] The parties discussed that the interior would be undertaken on an “as is where is” basis, but the Landlord granted the Tenant permission to coordinate directly with the outgoing tenant (Donutes) regarding the interior state before their term ended on 30.9.2022. The Tenant offered a monthly rental of RM37,000.00 which Landlord accepted on the condition that the deposits were paid immediately. The Landlord’s legal counsel through his testimony at trial, confirmed that he drafted and revised the Tenancy Agreement at the meeting. He testified he was not aware of any oral agreements that were meant to be included in the final written contract. He explained that while the Tenancy Agreement was executed on this date - 5.9.2022, it was dated 29.9.2022 to avoid stamp duty penalties for the Tenant. [19] This meeting on 5.9.2022 resulted in several significant resolution and actions. The Tenant’s directors (Guarantors) executed the Tenancy Agreement for the Tenant, which had been revised by the Landlord’s legal counsel during the meeting to reflect the parties’ discussions. The Tenant’s directors (Guarantors) had also signed the Personal Guarantees and Indemnities agreeing to be personally liable as principal debtors for the Tenant’s obligations. The Tenant made an immediate payment of RM166,500.00, which covered the security deposit, utility deposit, and advance rental for the first month. [20] Both the directors (Guarantors) of the Tenant admitted during cross-examination that they read and understood the terms of the Tenancy Agreement and the Personal Guarantees before signing of the same. All the witnesses for both parties admitted that the specific obligations regarding the exterior facade and wall cavities were not written in the agreed Tenancy Agreement. [21] The Meeting on 3.10.2022 was arranged to resolve the Tenant’s dissatisfaction regarding the physical state of the premises, specifically the exterior façade. Ms. Koh again attended the meeting as representative for the Landlord. The representative of Donutes was also in attendance, whom the Tenant’s directors (Guarantors) claimed had informed them that Donutes had paid the Landlord an estimated RM300,000.00 for restoration works. The Landlord’s legal counsel was present. This time the Tenant’s trial counsel - the lawyer on record conducting the examination of witnesses was also present. [22] At this meeting, the Landlord informed Donutes that they were obligated to return the premises in a condition acceptable to the Landlord before possession could be delivered to the Tenant. According to the Tenant, the meeting concluded with the Landlord agreeing to remove the external glass panels, cover up the wall cavities on the first floor, and take photographs of the façade to establish its bare state and avoid future disputes. The Tenant requested a written confirmation letter to document these oral promises. Such document never came to fruition. [23] Four days after this meeting, the Landlord issued a letter dated 7.10.2022 fixing the commencement date of the Tenancy Agreement as 1.10.2022. The Landlord claimed this was within its sole discretion under Clause 1.1 of the Tenancy Agreement. [24] The Landlord contends there was a follow-up meeting on 7.10.2022 intended to resolve ongoing disputes regarding the physical state of the premises before the Tenant would accept vacant possession. The meeting was held at the premises attended by the Tenant’s director and the Landlord’s legal counsel were present. However, the Landlord’s legal counsel testified multiple times during cross-examination that he could not recall a physical meeting taking place on that specific date. He could not confirm that he personally showed the Tenant that the wall cavities had been covered. [25] The Landlord’s solicitor admitted he was aware of the existence of a dispute between the parties which arose after the Tenancy Agreement was signed concerning an alleged oral agreement regarding the premises’ condition. He clarified that while there were negotiations regarding what the Tenant purportedly stated existed, he was not aware of any binding oral agreement that formed part of the Tenancy Agreement itself. He maintained that any work done (such as partial removal) was simply the state of the premises on an “as is where is” basis as of the commencement date. [26] The “as is where is” basis is also embedded undisputedly in the Tenancy Agreement. The Landlord’s director testified that he only agreed to remove part of the façade as a goodwill gesture to help the Tenant install its signage, not as a contractual obligation. He also testified that as the owner, he had the absolute right to beautify the building’s façade and that the Tenant had no authority to dictate how that work was done or how it was funded. He stated that he had already beautified the façade to allow for the signboard and that the Tenant’s refusal to accept possession despite these efforts was a breach of contract. [27] The Notice of Termination was issued by the Tenant on 16.11.2022 citing the Landlord’s failure to fulfill the alleged oral conditions. It is undisputed that the Tenant never accepted the keys or took physical possession of the premises. This Court’s Analysis [28] Regarding the RM300,000.00 claim: the Tenant argued that this payment was specifically intended for the restoration of the exterior façade and the covering of wall cavities. The Tenant contended that since the Landlord had received these funds from the outgoing tenant, the Landlord was contractually (or via oral agreement) bound to utilize that money to deliver the premises in the bare conditions as orally promised to the Tenant. [29] The Landlord countered this claim from a few angles. The Landlord’s counsel objected to the testimony of the Tenant’s directors (Guarantors) regarding the payment, having labeled it as inadmissible hearsay because the details of the arrangement between the Landlord and Donutes were being introduced by the Tenant’s witnesses rather than a direct party to that specific agreement. [30] Additionally, the Landlord argued that the RM300,000.00 payment was not included in the Tenant’s original pleadings (Statement of Claim (SoC) or Defence to the Counterclaim) and therefore should be disregarded by this Court. The Landlord maintained that any financial settlement between it and a third party (Donutes) was a private matter that had no legal bearing on the written Tenancy Agreement with the Tenant, which required the Tenant to accept the premises on as “as is where is” basis. [31] This Court’s analysis on this RM300,000.00 restoration claim centers on three primary deficiencies. Firstly, it is dangerous to accept the evidence of the RM300,000.00 payment because it remained hearsay throughout the trial. DW1 and DW2 testified that they were informed during a meeting on 3.10.2022 that the previous tenant, Donutes, had paid this sum to the Landlord for restoration. Neither Ms Koh nor a representative from Donutes was called to testify and verify the payment or its specific purpose. So, the evidence lacked the necessary foundation for this Court to rely upon it as a fact. See the Supreme Court’s decision in Guthrie Sdn Bhd v Trans-Malaysian Leasing Corp Bhd [1991] 1 MLJ 33 at p35, and the Federal Court case of Tengku Dato’ Ibrahim Petra bin Tengku Indra Petra v Petra Perdana Bhd and another appeal [2018] 2 MLJ 177 at p206-207. [32] Secondly, even is such payment existed, it was legally irrelevant to the specific rights and obligations defined in the Tenancy Agreement between the Landlord and the Tenant. Any financial settlement between the Landlord and its former tenant (Donutes) was a private matter totally not related to the current Tenancy Agreement of the Personal Guarantees and Indemnities. Under the parole evidence rule of sections 91 and 90 of the Evidence Act 1950 (EA) the written agreement is the best evidence of the parties’ intentions. [33] A critical procedural barrier for the Tenant is that the RM300,000.00 claim was not part of the Tenant’s pleaded case (either in its Defence or its SoC). This Court accepts the Landlord’s objection that parties are strictly. Bound by their pleadings. The Tenant did not specifically plead the RM300,000.00 payment as a material fact or condition for performance. See Superintendent of Lands and Surveys (4th Div) & Anor v Hamit Bin Matusin & Ors [1994] 3 MLJ 185 and affirmed by the Federal Court in Iftikar Ahmed Khan (as the executor of the estate for Sardar Mohd Roshan Khan, deceased) v Perwira Affin Bank Berhad (previously known as Perwira Habib Bank Malaysia Bhd) [2018] 2 MLJ 292. [34] On the condition of the ‘as is where is’ basis and the condition of the premises, this Court’s reference is Clause 1 of the Tenancy Agreement that states: “The Landlord agrees to let and the Tenant agrees to take a tenancy of the Demised Premises ‘as is where is’ for a fixed term stated in Section 5 of the First Schedule thereto..” [35] This requirement is further solidified in the concluding sentence of Clause 1.1 of the Tenancy Agreement which stipulates: “Parties agree that the Landlord … is only required to deliver the vacant possession of the demise premises as is where is on the commencement date.” [36] This Court noted that the Tenant contended that during meeting on 5.9.2022 and 3.10.2022, oral representations were made by the Landlord’s staff promising to remove the entirety of the exterior façade and cover wall cavities. However, while the meetings had taken place, the said resolved negotiated terms were not incorporated into the final signed Tenancy Agreement. In fact, the Landlord’s counsel’s testimony that he was not aware of anything other than what was stated in the Tenancy Agreement at the material time, remains unshaken. [37] During the cross-examination of both the Tenant’s directors (Guarantors), they admitted that the written Tenancy Agreement they signed did not contain any terms regarding the removal of the façade covering the wall cavities. Furthermore, they concede that they did not request their lawyers to include these purported oral promises into the written contract or any supplemental agreement. [38] Under the parole evidence rule as codified in section 90 and 91 of EA, when the terms of a contract have been reduced to a written document, no extrinsic evidence is admissible to contradict, vary, add to, or subtract from those written terms. This Court relies on the established principles of:

Binding nature of the signed contracts which is a general principle of law that a party who signs a written contract is bound by its terms, regardless of whether they have read or understood them. This was established in the leading case of L’Estrange v F Graucob Ltd [1934] 2 KB 394, Polygram Records Sdn Bhd v The Search & Anor [1994] 3 MLJ 127 and Wee Lian Construction Sdn Bhd v Ingersoll-Jati Malaysia Sdn Bhd [2010] 3 MLJ 425.

(ii) The primacy of the written word as ruled by the Court of Appeal in Syarikat Binaan Utara Jaya v Koperasi Serbaguna Sungai Gelugor Bhd [2009] 1 CLJ 786. It held that where the language of a document is clear and unambiguous, its nature is to be determined solely by looking at its contents, uninfluenced by any alleged prior intentions.

III

(iii) The Entire Agreement Clause which is contained in the Tenancy Agreement - Clause 6 expressly states that the document constitutes the entire agreement between the parties supersede any previous agreement or understanding. As noted in Master Strike Sdn Bhd v Sterling Heights Sdn Bhd [2005] 2 CLJ 596, such a clause precludes parties from relying on collateral warranties or assurances made during negotiations.

(iv) Oral evidence cannot be used to impose additional obligations such as façade restorations, that would contradict the ‘as is where is’ delivery term found in the written contract. It was emphasized in United Overseas Bank (China) Limited, Chengdu Branch v. Siow Kwang Joon @ Siow Kwong Shang [2024] MLJU 507 that the absence of a written term means the formal agreement is silent, and oral collateral agreements that are inconsistent with the formal terms cannot be permitted. See Seven Seas Industries Sdn Bhd v Philips Electronic Supplies (M) Sdn Bhd & Anor [2008] 5 MLJ 157; Bank Pertanian Malaysia Berhad v. Fiskal Fantasi Sdn Bhd and Anor [2011] CLJU 678. [39] In light of the clear and unambiguous wording of Clause 1.1, this Court finds that the Landlord’s only obligation was to deliver the premises in its existing state as of the commencement date. Ten Tenant’s reliance on purported oral agreements is legally unsustainable as these terms were never reflected in the written and executed Tenancy Agreement and are prohibited by the parole evidence rule. [40] This Court rules that the Tenant was contractually bound to accept the premises on an ‘as is where is’ basis as of the commencement date, regardless of how the Landlord funded any beautification works. [41] The commencement date matter that arose when the Landlord’s letter of 7.10.2022 to the Tenant stated that it exercised its discretion under Clause 1.1 of the Tenancy Agreement and determined 1.10.2022 as the commencement date for the purpose of the tenancy. The letter stressed that this date applied regardless of when the Tenant actually collected the keys. [42] The primary authority for determining the start of the tenancy is found in Clause 1.1 of the Tenancy Agreement that states with clarity: “The tenancy contemplated herein shall commence on such date to be determined by the Landlord at the reasonable discretion of the Landlord … “ [43] Evidence borne at trial shows that both the directors (Guarantors) of the Tenant confirmed that they had respectively read and understood the terms of the Tenancy Agreement before signing, particularly this contractual power vested in the Landlord. Accordingly, this Court rules in favour of the Landlord on the issue of the commencement date. The Landlord possessed the sole discretionary power to determine the date, and its exercise of that power was valid under the Tenancy Agreement. [44] Consequent to this ruling, the Tenant’s termination is found to be invalid and constitutes a material breach of the Tenancy Agreement.

Preamble

Pursuant to Clause 4(f) of the Tenancy Agreement, this breach entitled the Landlord to the absolute forfeiture of the RM166,500.00 deposits and a claim for the unexpired term rental amounting to RM1,295,000.00. See Berjaya Times Square Sdn Bhd v Twingems Sdn Bhd & Anor and another action [2012] 9 MLJ 510. [45] This Court also determines on the photographic evidence presented by both parties. On a balance of probabilities, this Court finds that the Landlord’s photographs, attached to the formal letter of 7.10.2022, represent the more recent, advanced state of the premises. A side-by-side comparison of the sets with the Tenant’s reveals a clear physical progression in the work performed on the façade. The Tenant’s photographs show that only one row of the exterior façade had been removed. In contrast, the Landlord’s photographs show that two rows of façade panels had been removed. Because of the removal of the two rows represents a later stage of the ‘beautification’ process than the removal of a single row, it is logically certain that the Landlord’s photographs document the premises at a more recent point in time. [46] This Court finds that the photographs adduced by the Tenant to be legally unreliable and cannot accept the Tenant’s claim that they were taken on 3.10.2022 because the Tenant had failed to produce a certificate under section 90A EA which is a mandatory requirement for the admission of computer-generated documents to verify that they were produced in the ordinary course of use. See Gnanasegaran Parararajasingam v. PP [1997] 4 CLJ 6; Embun Karisma Resources (M) Sdn Bhd v. Nagaraju Vengadesalu [2024] CLJU 3087 The Tenant’s director (DW1) admitted during cross-examination that she no longer possessed the iPhone 13 Pro Max purportedly used to take the pictures, making forensic verification of the metadata impossible. As noted during the trial, digital images are subject to manipulation, such being ‘cut and paste’ or forwarded, and without the source device or proper certification, this Court cannot verify the authenticity of the dates. [47] On the other hand, the Landlord’s director provided credible testimony that the state of the façade shown in its photographs resulted from the work he performed on a goodwill and compromise basis. This Court finds that on a balance of probabilities, they were the more recent ones for this Court to rely on that backed his testimony. [48] The interest applies when an Event of Default occurs under Clause 4(a)(i) which includes the Tenant failing, refusing or neglecting to pay the Monthly Rental or any other monies due on their respective dates. The interest is calculated on a daily rest basis on any outstanding sums until full payment is made. The Tenancy Agreement stipulates that this late payment interest is deemed a debt due and payable by the Tenant to the Landlord. During trial, both the Tenant’s directors (the Guarantors) confirmed their understanding that the Landlord was contractually allowed to claim this 8% interest if the rental payments were not made. [49] Section 114(g) of the Evidence Act 1950 provides that this Court may presume that evidence which could be and is not produced would, if produced, be unfavourable to the person who withholds it. The principle of adverse inference for failure to call material witnesses is well-established for failing to call material witnesses, particularly, Ms Koh, who purportedly gave the Purported Oral Agreements (on behalf of the Landlord). In Jaafar Bin Shaari & Anor v Tan Lip Eng & Anor [1997] 3 MLJ 693, the Supreme Court held that adverse inference ought to be drawn for the failure to call important witnesses when the circumstances appropriately call for such an adverse inference. [50] The Defendants have alleged that there exists an oral agreement (agreed to by the Landlord’s representative, Ms Koh, during meetings held on 5.9.2022 and 3.10.2022) that the Landlord will deliver vacant possession of a bare facade. Without the testimony of Ms Koh, the assertion that there was such an oral agreement given by the Landlord is merely a bare assertion and unsubstantiated. Her absence creates a gap in the Defendants’ evidence that in place of it now, is filled by the legal presumption that her testimony would have adversed to the Defendants’ contention. See Omega Securities Sdn Bhd v Kok Foon Loy [2010] 9 MLJ 224. Issue on Tenant’s Counsel [51] This Court is compelled to address the issue of the Tenant’s counsel, Ms. Chai Sim Ann, which centers on her dual role as a material participant in the negotiations (which this Court only discovered much later during trial) and her subsequent representation of the Tenant at trial. This Court’s ruling, is that the Tenant was precluded from calling her as a witness at the eleventh hour, and her failure to testify leaves critical parts of the Tenant's version of events uncorroborated. [52] It cannot be enough said on conflict of interest and the loss of objectivity that this Court saw happened. It is again emphasized at this junction, that an advocate and solicitor should not appear in a case where they are also a material witness. Ms. Chai was not merely a legal advisor; she was personally involved in the negotiations after the Tenancy Agreement was signed and the relationship "went a bit sour". [53] This Court noted that when counsel is personally involved in the facts of a dispute, their decisions and advice may be clouded. However, counsel is expected to maintain an objective angle to represent their client effectively, which is compromised when their own versions and perhaps ego are at play. [54] The Landlord’s counsel correctly pointed out that under legal profession practice rules, it is inappropriate for an advocate to be a witness in a case where they are currently representing a party. This objection is also an ethical one - calling one’s own colleague as a witness would result in a lack of fairness during cross-examination. [55] Despite Ms. Chai's name surfacing everywhere in the testimonies of other witnesses, the Tenant failed to include her on their original witness list. There was extensive case management before trial. The five pre-trial management sessions involved time and had been active for years to ensure that when it reached trial, it was all systems go. [56] When the Tenant’s counsel (MPL) requested a stand-down at the very end of the trial to take instructions on calling Ms. Chai as a witness and filing an amended list, this Court ruled that it was too late. With the need to maintain procedural Integrity, this Court ruled that the defense had ample time to plan their witness list from the beginning, given that Ms. Chai's involvement was known to the Tenant from the outset. As warned, if Ms. Chai had been allowed to become a witness, the entire legal team for the Tenant might have been required to recuse themselves from the case, further delaying and complicating the proceedings. [57] The Court rules in favor of the Landlord's objection, finding that the Tenant is bound by its initial witness list and procedural conduct. The late application to call Ms. Chai was rejected as it would compromise the integrity of the trial, violate legal profession rules, and cause unfair prejudice. The Tenant must accept the legal consequence that their version of the negotiations remains uncorroborated by the very counsel who participated in them. See Vijayalakshmi Devi Nadchatiram v Saraswathy Devi Nadchatiram [2000] 4 CLJ 870; Mirza Mohamed Tariq Beg Mirza HH Beg v Margaret Low Saw Lui & Ors [2009] 4 CLJ 303; Black v Taylor [1993] 3 NZLR 403. This Court’s Conclusion [58] Premised on the above analysis and findings, this Court concludes that the written Tenancy Agreement remains the sole and definitive governing document between the Landlord and the Tenant as it contains an Entire Agreement clause that supersedes all prior negotiations. Under the parole evidence rule, the Tenant’s reliance on purported oral representations to modify the delivery condition of the premises is inadmissible, as the agreement clearly stipulates an ‘as is where is’ delivery basis. [59] Furthermore, the Landlord validly exercised its contractual discretion under Clause 1.1 of the Tenancy Agreement to fix the commencement date as 1.10.2022. The Tenant’s subsequent refusal to take vacant possession and its unilateral termination of the Tenancy Agreement were unfounded and constituted a material breach of contract. Consequently, the Landlord is entitled to the contractual remedies provided under Clause 4(f) of the Tenancy Agreement, while the Tenant’s claims for the return of deposits and the nullification of personal guarantees lack legal merit. This Court’s Orders [60] This Court makes the following orders:

Suit 336 is allowed

Suit 656 is dismissed

The Tenants and the Guarantors are jointly and severally ordered to pay the Landlord the sum of RM1,295,000.00, representing the outstanding rental for the unexpired term of the tenancy

Late payment interest is awarded on the sum of RM1,295,000.00 at the rate of 8% per year, calculated on daily rest from 1.11.2022 until the date of full settlement

A declaration is granted that the security and utility deposits totaling RM129,500.00 are absolutely forfeited to the Landlord

The Personal Guarantees and Indemnities executed by the Guarantors (the Tenant’s directors) are declared valid and binding

Costs are awarded to the Landlord in the sum of RM55,000.00, subject to allocator. DATED 30 APRIL 2026 ROZ MAWAR ROZAIN JUDGE HIGH COURT OF MALAYA KUALA LUMPUR For the Plaintiff (suit 336) & Defendants (suit 656): Peter Neik Xiang Cheng together with Jazz Cheah Jeay Ying Neik & Partners (Petaling Jaya) For the Defendants (suit 336) & Plaintiff (suit 656): Tey Hoo Nee Chai & Company (Kuala Lumpur)

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Malaysian judgment

Case metadata

Court: High Court of Malaysia
Decision date: 30 Apr 2026
Case number: WA-22NCvC-656-11/2023
Coram: YA Puan Roz Mawar binti Rozain
Practice area: This Court concludes that the written Tenancy Agreement remains the sole and definitive governing document between the Landlord and the Tenant as it contains an Entire Agreement clause that supersedes all prior negotiations. Under the parole evidence rule, the Tenant’s reliance on purported oral representations to modify the delivery condition of the premises is inadmissible, as the agreement clearly stipulates an ‘as is where is’ delivery basis. keywords : landlord, tenant, breach of contract Furthermore, the Landlord validly exercised its contractual discretion under Clause 1.1 of the Tenancy Agreement to fix the commencement date as 1.10.2022. The Tenant’s subsequent refusal to take vacant possession and its unilateral termination of the Tenancy Agreement were unfounded and constituted a material breach of contract. Consequently, the Landlord is entitled to the contractual remedies provided under Clause 4(f) of the Tenancy Agreement, while the Tenant’s claims for the return of deposits and the nullification of personal guarantees lack legal merit. This Court makes the following orders: (a) Suit 336 is allowed (b) Suit 656 is dismissed (c) The Tenants and the Guarantors are jointly and severally ordered to pay the Landlord the sum of RM1,295,000.00, representing the outstanding rental for the unexpired term of the tenancy (d) Late payment interest is awarded on the sum of RM1,295,000.00 at the rate of 8% per year, calculated on daily rest from 1.11.2022 until the date of full settlement (e) A declaration is granted that the security and utility deposits totaling RM129,500.00 are absolutely forfeited to the Landlord (f) The Personal Guarantees and Indemnities executed by the Guarantors (the Tenant’s directors) are declared valid and binding (g) Costs are awarded to the Landlord in the sum of RM55,000.00, subject to allocator
Version: Alasan Penghakiman 1
Published: 5 May 2026
Source ID: b0bde6c4-8572-4655-9180-87bbc325a4dc

Catchwords

This Court concludes that the written Tenancy Agreement remains the sole and definitive governing document between the Landlord and the Tenant as it contains an Entire Agreement clause that supersedes all prior negotiations. Under the parole evidence rule, the Tenant’s reliance on purported oral representations to modify the delivery condition of the premises is inadmissible, as the agreement clearly stipulates an ‘as is where is’ delivery basis. keywords : landlord, tenant, breach of contract Furthermore, the Landlord validly exercised its contractual discretion under Clause 1.1 of the Tenancy Agreement to fix the commencement date as 1.10.2022. The Tenant’s subsequent refusal to take vacant possession and its unilateral termination of the Tenancy Agreement were unfounded and constituted a material breach of contract. Consequently, the Landlord is entitled to the contractual remedies provided under Clause 4(f) of the Tenancy Agreement, while the Tenant’s claims for the return of deposits and the nullification of personal guarantees lack legal merit. This Court makes the following orders: (a) Suit 336 is allowed (b) Suit 656 is dismissed (c) The Tenants and the Guarantors are jointly and severally ordered to pay the Landlord the sum of RM1,295,000.00, representing the outstanding rental for the unexpired term of the tenancy (d) Late payment interest is awarded on the sum of RM1,295,000.00 at the rate of 8% per year, calculated on daily rest from 1.11.2022 until the date of full settlement (e) A declaration is granted that the security and utility deposits totaling RM129,500.00 are absolutely forfeited to the Landlord (f) The Personal Guarantees and Indemnities executed by the Guarantors (the Tenant’s directors) are declared valid and binding (g) Costs are awarded to the Landlord in the sum of RM55,000.00, subject to allocator

Parties

1. ) OISHII WASABI SDN BHD - plaintiff - ejudgment_parties
2. ) TAN DEE HON - plaintiff - ejudgment_parties
3. ) TAN LEE TING - plaintiff - ejudgment_parties
TOPZ SDN BHD - defendant - ejudgment_parties

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Oishii Wasabi Sdn Bhd v Topz Sdn Bhd (WA-22NCvC-656-11/2023)

High Court of Malaysia30 Apr 2026

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Outcome

What the court ordered

[1] This commercial tenancy dispute between Oishii Wasabi Sdn Bhd (the Tenant) and Topz Sdn Bhd (the Landlord) centers on whether the Landlord fulfilled specific conditions regarding the physical state of the premises before the tenancy was to commence. The premises in this case is a shop lot with an address at No. 1, Jalan SS15/4E, 47500 Subang Jaya, Selangor. [2] The Landlord’s suit against the Tenant (Suit 336) is for losses of RM1,295,000.00 with 8% interest calculated daily from 1.11.2022 until full and final settlement, this Court’s declaration that he is entitled to forfeit RM129,500.00 deposit paid by the Tenant, and costs. [3] The Tenant’s suit (and also its directors (the Guarantors)) is for the opposite - declarations that the Tenancy Agreement has been validly terminated by it on 16.11.2022 and consequently the Personal Guarantees and Indemnities, the return of the deposit of RM166,500.00, damages, aggravated damages, interests and costs. [4] Both Suit 336 and Suit 656 were jointly heard. It was a one-day trial with the Landlord calling its former legal solicitor who had prepared and revised the Tenancy Agreement and its director. While the Tenant call its two directors (Guarantors) who had executed the Personal Guarantees and Indemnities; who are named as litigants in this case. The Tenant’s Core Arguments [5] The Tenant, along with its directors (the Guarantors), argues that the Tenancy Agreement was contingent upon several oral agreements and conditions precedent. The Tenant claims the Landlord agreed during meetings on 5.9.2022 and 3.10.2022 to deliver the premises in a specific physical state. This included removing external glass panels, making the exterior façade bare, and covering up any resulting cavities or holes at the Landlord’s expense. [6] It contends that because these works were not completed, the premises remained unsuitable for their business operations. The Tenant argues the Landlord unilaterally fixed the commencement date as 1.10.2022 without fulfilling its obligations, The Tenant also alleges the Landlord backdated the agreement from its actual execution date (5.9.2022) to 29.9.2022 to justify this commencement date. [7] Based on these alleged breaches, the Tenant maintains it validly terminated the agreement on 16.11.2022 and is entitled to a full refund of its RM166,500.00 deposit and advance rental. The Landlord’s Core Arguments [8] The Landlord denies the existing of binding oral agreements and relies strictly on the terms of the written Tenancy Agreement. The Landlord asserts that the written contract, which both parties signed, contains no mention of the alleged oral conditions. Under the parole evidence rule, it argues that evidence of such oral negotiations is inadmissible to vary the written terms. [9] The Landlord points to clause in the agreement stating the premises were to be taken on an “as is where is” basis as of the commencement date. It argues that Clause 1.1 gives the Landlord the sole discretion to determine the commencement date, and there was nothing irregular about fixing for 1.10.2022. [10] The Landlord claims they only agreed to remove a portion of the facade on a goodwill basis to accommodate the Tenant’s signage, and this did not constitute a contractual obligation to restore the entire façade to a bare state. It contends that the Tenant’s refusal to accept vacant possession and its subsequent notice of termination were wrongful and constituted a breach of contract. Due to the breach, the Landlord claims they are entitled to forfeit the deposits and recover the full rental for the unexpired 35-month term totaling RM1,295,000.00. The Landlord maintains that the Tenant’s directors are personally and jointly liable for these sums as principal debtors under the signed Guarantee and Indemnities. Factual Matrix [11] The Tenancy Agreement is a written agreement purportedly dated 29.9.2022 for a term of three years. While the document is dated so, evidence shows that it was executed by the Tenant’s directors on 5.9.2022. The Tenant’s directors also signed Personal Guarantees and Indemnities dated 29.9.2022, where they agreed to be liable as principal debtors for the Tenant’s obligations. [12] Clauses 1 and 1.1 of the Tenancy Agreement expressly state that the Tenant accepts the premises in its current state as of the commencement date. Clause 6 of the Tenancy Agreement states that the written document constitutes the entire agreement and supersedes all previous undertakings. [13] The Tenant paid a total of RM166,500.00 on 5.9.2022 which included a RM111,000.00 as security deposit, a RM18,500.00 utility deposit, and RM37,000.00 advance rental for October 2022. [14] The Landlord is claiming RM1,295,000.00 representing the full rental for the remaining 35 months of the unexpired term. It also claims interest at 8% per annum on outstanding sums, as provided in Clause 4(b)(i) of the Tenancy Agreement. [15] Photographs from 7.10.2022 attached to the Landlord’s letter show that two rows of glass panels had been removed from the exterior façade by 1.10.2022. Photographs purported taken by the Tenant on 3.10.2022 were introduced to argue that the façade was not yet in the agreed bare condition. The Tenant attempted to adduce evidence during trial that suggests the previous tenant, Donutes Coffee & Bakery (“Donutes”), paid the Landlord RM300,000.00 to restore the premises to its original condition, which the Tenant argues should have been used to fulfill the Landlord’s alleged work obligations. This piece of evidence was objected to by the Landlord as inadmissible on the grounds of hearsay and irrelevant. [16] The Tenant relies on discussions held during meetings on 5.9.2022 and 3.10.2022 where it claims the Landlord’s representative named Ms. Koh agreed to remove all external glass panels and cover wall cavities at the Landlord’s expense. Both parties finalized negotiations and executed the primary contractual documents for the tenancy. The Landlord’s legal counsel was present. and he had handled the preparation and revision of the contract documents. The Landlord’s director was not present during this meeting where the Tenant executed the Tenancy Agreement on this date. [17] The discussions at the 5.9.2022 meeting when in the end the Tenant executed the Tenancy Agreements, included the bare condition issue. The Tenant repeatedly emphasized that it was essential for the premises, particularly the exterior façade, to be delivered in a bare condition. It was allegedly discussed and agreed that the Landlord would, at its own expense, remove external glass panels and cover up cavities or holes in the outer wall of the first floor. [18] The parties discussed that the interior would be undertaken on an “as is where is” basis, but the Landlord granted the Tenant permission to coordinate directly with the outgoing tenant (Donutes) regarding the interior state before their term ended on 30.9.2022. The Tenant offered a monthly rental of RM37,000.00 which Landlord accepted on the condition that the deposits were paid immediately. The Landlord’s legal counsel through his testimony at trial, confirmed that he drafted and revised the Tenancy Agreement at the meeting. He testified he was not aware of any oral agreements that were meant to be included in the final written contract. He explained that while the Tenancy Agreement was executed on this date - 5.9.2022, it was dated 29.9.2022 to avoid stamp duty penalties for the Tenant. [19] This meeting on 5.9.2022 resulted in several significant resolution and actions. The Tenant’s directors (Guarantors) executed the Tenancy Agreement for the Tenant, which had been revised by the Landlord’s legal counsel during the meeting to reflect the parties’ discussions. The Tenant’s directors (Guarantors) had also signed the Personal Guarantees and Indemnities agreeing to be personally liable as principal debtors for the Tenant’s obligations. The Tenant made an immediate payment of RM166,500.00, which covered the security deposit, utility deposit, and advance rental for the first month. [20] Both the directors (Guarantors) of the Tenant admitted during cross-examination that they read and understood the terms of the Tenancy Agreement and the Personal Guarantees before signing of the same. All the witnesses for both parties admitted that the specific obligations regarding the exterior facade and wall cavities were not written in the agreed Tenancy Agreement. [21] The Meeting on 3.10.2022 was arranged to resolve the Tenant’s dissatisfaction regarding the physical state of the premises, specifically the exterior façade. Ms. Koh again attended the meeting as representative for the Landlord. The representative of Donutes was also in attendance, whom the Tenant’s directors (Guarantors) claimed had informed them that Donutes had paid the Landlord an estimated RM300,000.00 for restoration works. The Landlord’s legal counsel was present. This time the Tenant’s trial counsel - the lawyer on record conducting the examination of witnesses was also present. [22] At this meeting, the Landlord informed Donutes that they were obligated to return the premises in a condition acceptable to the Landlord before possession could be delivered to the Tenant. According to the Tenant, the meeting concluded with the Landlord agreeing to remove the external glass panels, cover up the wall cavities on the first floor, and take photographs of the façade to establish its bare state and avoid future disputes. The Tenant requested a written confirmation letter to document these oral promises. Such document never came to fruition. [23] Four days after this meeting, the Landlord issued a letter dated 7.10.2022 fixing the commencement date of the Tenancy Agreement as 1.10.2022. The Landlord claimed this was within its sole discretion under Clause 1.1 of the Tenancy Agreement. [24] The Landlord contends there was a follow-up meeting on 7.10.2022 intended to resolve ongoing disputes regarding the physical state of the premises before the Tenant would accept vacant possession. The meeting was held at the premises attended by the Tenant’s director and the Landlord’s legal counsel were present. However, the Landlord’s legal counsel testified multiple times during cross-examination that he could not recall a physical meeting taking place on that specific date. He could not confirm that he personally showed the Tenant that the wall cavities had been covered. [25] The Landlord’s solicitor admitted he was aware of the existence of a dispute between the parties which arose after the Tenancy Agreement was signed concerning an alleged oral agreement regarding the premises’ condition. He clarified that while there were negotiations regarding what the Tenant purportedly stated existed, he was not aware of any binding oral agreement that formed part of the Tenancy Agreement itself. He maintained that any work done (such as partial removal) was simply the state of the premises on an “as is where is” basis as of the commencement date. [26] The “as is where is” basis is also embedded undisputedly in the Tenancy Agreement. The Landlord’s director testified that he only agreed to remove part of the façade as a goodwill gesture to help the Tenant install its signage, not as a contractual obligation. He also testified that as the owner, he had the absolute right to beautify the building’s façade and that the Tenant had no authority to dictate how that work was done or how it was funded. He stated that he had already beautified the façade to allow for the signboard and that the Tenant’s refusal to accept possession despite these efforts was a breach of contract. [27] The Notice of Termination was issued by the Tenant on 16.11.2022 citing the Landlord’s failure to fulfill the alleged oral conditions. It is undisputed that the Tenant never accepted the keys or took physical possession of the premises. This Court’s Analysis [28] Regarding the RM300,000.00 claim: the Tenant argued that this payment was specifically intended for the restoration of the exterior façade and the covering of wall cavities. The Tenant contended that since the Landlord had received these funds from the outgoing tenant, the Landlord was contractually (or via oral agreement) bound to utilize that money to deliver the premises in the bare conditions as orally promised to the Tenant. [29] The Landlord countered this claim from a few angles. The Landlord’s counsel objected to the testimony of the Tenant’s directors (Guarantors) regarding the payment, having labeled it as inadmissible hearsay because the details of the arrangement between the Landlord and Donutes were being introduced by the Tenant’s witnesses rather than a direct party to that specific agreement. [30] Additionally, the Landlord argued that the RM300,000.00 payment was not included in the Tenant’s original pleadings (Statement of Claim (SoC) or Defence to the Counterclaim) and therefore should be disregarded by this Court. The Landlord maintained that any financial settlement between it and a third party (Donutes) was a private matter that had no legal bearing on the written Tenancy Agreement with the Tenant, which required the Tenant to accept the premises on as “as is where is” basis. [31] This Court’s analysis on this RM300,000.00 restoration claim centers on three primary deficiencies. Firstly, it is dangerous to accept the evidence of the RM300,000.00 payment because it remained hearsay throughout the trial. DW1 and DW2 testified that they were informed during a meeting on 3.10.2022 that the previous tenant, Donutes, had paid this sum to the Landlord for restoration. Neither Ms Koh nor a representative from Donutes was called to testify and verify the payment or its specific purpose. So, the evidence lacked the necessary foundation for this Court to rely upon it as a fact. See the Supreme Court’s decision in Guthrie Sdn Bhd v Trans-Malaysian Leasing Corp Bhd [1991] 1 MLJ 33 at p35, and the Federal Court case of Tengku Dato’ Ibrahim Petra bin Tengku Indra Petra v Petra Perdana Bhd and another appeal [2018] 2 MLJ 177 at p206-207. [32] Secondly, even is such payment existed, it was legally irrelevant to the specific rights and obligations defined in the Tenancy Agreement between the Landlord and the Tenant. Any financial settlement between the Landlord and its former tenant (Donutes) was a private matter totally not related to the current Tenancy Agreement of the Personal Guarantees and Indemnities. Under the parole evidence rule of sections 91 and 90 of the Evidence Act 1950 (EA) the written agreement is the best evidence of the parties’ intentions. [33] A critical procedural barrier for the Tenant is that the RM300,000.00 claim was not part of the Tenant’s pleaded case (either in its Defence or its SoC). This Court accepts the Landlord’s objection that parties are strictly. Bound by their pleadings. The Tenant did not specifically plead the RM300,000.00 payment as a material fact or condition for performance. See Superintendent of Lands and Surveys (4th Div) & Anor v Hamit Bin Matusin & Ors [1994] 3 MLJ 185 and affirmed by the Federal Court in Iftikar Ahmed Khan (as the executor of the estate for Sardar Mohd Roshan Khan, deceased) v Perwira Affin Bank Berhad (previously known as Perwira Habib Bank Malaysia Bhd) [2018] 2 MLJ 292. [34] On the condition of the ‘as is where is’ basis and the condition of the premises, this Court’s reference is Clause 1 of the Tenancy Agreement that states: “The Landlord agrees to let and the Tenant agrees to take a tenancy of the Demised Premises ‘as is where is’ for a fixed term stated in Section 5 of the First Schedule thereto..” [35] This requirement is further solidified in the concluding sentence of Clause 1.1 of the Tenancy Agreement which stipulates: “Parties agree that the Landlord … is only required to deliver the vacant possession of the demise premises as is where is on the commencement date.” [36] This Court noted that the Tenant contended that during meeting on 5.9.2022 and 3.10.2022, oral representations were made by the Landlord’s staff promising to remove the entirety of the exterior façade and cover wall cavities. However, while the meetings had taken place, the said resolved negotiated terms were not incorporated into the final signed Tenancy Agreement. In fact, the Landlord’s counsel’s testimony that he was not aware of anything other than what was stated in the Tenancy Agreement at the material time, remains unshaken. [37] During the cross-examination of both the Tenant’s directors (Guarantors), they admitted that the written Tenancy Agreement they signed did not contain any terms regarding the removal of the façade covering the wall cavities. Furthermore, they concede that they did not request their lawyers to include these purported oral promises into the written contract or any supplemental agreement. [38] Under the parole evidence rule as codified in section 90 and 91 of EA, when the terms of a contract have been reduced to a written document, no extrinsic evidence is admissible to contradict, vary, add to, or subtract from those written terms. This Court relies on the established principles of:
Binding nature of the signed contracts which is a general principle of law that a party who signs a written contract is bound by its terms, regardless of whether they have read or understood them. This was established in the leading case of L’Estrange v F Graucob Ltd [1934] 2 KB 394, Polygram Records Sdn Bhd v The Search & Anor [1994] 3 MLJ 127 and Wee Lian Construction Sdn Bhd v Ingersoll-Jati Malaysia Sdn Bhd [2010] 3 MLJ 425.
The primacy of the written word as ruled by the Court of Appeal in Syarikat Binaan Utara Jaya v Koperasi Serbaguna Sungai Gelugor Bhd [2009] 1 CLJ 786. It held that where the language of a document is clear and unambiguous, its nature is to be determined solely by looking at its contents, uninfluenced by any alleged prior intentions.
The Entire Agreement Clause which is contained in the Tenancy Agreement - Clause 6 expressly states that the document constitutes the entire agreement between the parties supersede any previous agreement or understanding. As noted in Master Strike Sdn Bhd v Sterling Heights Sdn Bhd [2005] 2 CLJ 596, such a clause precludes parties from relying on collateral warranties or assurances made during negotiations.
Oral evidence cannot be used to impose additional obligations such as façade restorations, that would contradict the ‘as is where is’ delivery term found in the written contract. It was emphasized in United Overseas Bank (China) Limited, Chengdu Branch v. Siow Kwang Joon @ Siow Kwong Shang [2024] MLJU 507 that the absence of a written term means the formal agreement is silent, and oral collateral agreements that are inconsistent with the formal terms cannot be permitted. See Seven Seas Industries Sdn Bhd v Philips Electronic Supplies (M) Sdn Bhd & Anor [2008] 5 MLJ 157; Bank Pertanian Malaysia Berhad v. Fiskal Fantasi Sdn Bhd and Anor [2011] CLJU 678. [39] In light of the clear and unambiguous wording of Clause 1.1, this Court finds that the Landlord’s only obligation was to deliver the premises in its existing state as of the commencement date. Ten Tenant’s reliance on purported oral agreements is legally unsustainable as these terms were never reflected in the written and executed Tenancy Agreement and are prohibited by the parole evidence rule. [40] This Court rules that the Tenant was contractually bound to accept the premises on an ‘as is where is’ basis as of the commencement date, regardless of how the Landlord funded any beautification works. [41] The commencement date matter that arose when the Landlord’s letter of 7.10.2022 to the Tenant stated that it exercised its discretion under Clause 1.1 of the Tenancy Agreement and determined 1.10.2022 as the commencement date for the purpose of the tenancy. The letter stressed that this date applied regardless of when the Tenant actually collected the keys. [42] The primary authority for determining the start of the tenancy is found in Clause 1.1 of the Tenancy Agreement that states with clarity: “The tenancy contemplated herein shall commence on such date to be determined by the Landlord at the reasonable discretion of the Landlord … “ [43] Evidence borne at trial shows that both the directors (Guarantors) of the Tenant confirmed that they had respectively read and understood the terms of the Tenancy Agreement before signing, particularly this contractual power vested in the Landlord. Accordingly, this Court rules in favour of the Landlord on the issue of the commencement date. The Landlord possessed the sole discretionary power to determine the date, and its exercise of that power was valid under the Tenancy Agreement. [44] Consequent to this ruling, the Tenant’s termination is found to be invalid and constitutes a material breach of the Tenancy Agreement.
Suit 336 is allowed
Suit 656 is dismissed
The Tenants and the Guarantors are jointly and severally ordered to pay the Landlord the sum of RM1,295,000.00, representing the outstanding rental for the unexpired term of the tenancy
Late payment interest is awarded on the sum of RM1,295,000.00 at the rate of 8% per year, calculated on daily rest from 1.11.2022 until the date of full settlement
A declaration is granted that the security and utility deposits totaling RM129,500.00 are absolutely forfeited to the Landlord
The Personal Guarantees and Indemnities executed by the Guarantors (the Tenant’s directors) are declared valid and binding
Costs are awarded to the Landlord in the sum of RM55,000.00, subject to allocator. DATED 30 APRIL 2026 ROZ MAWAR ROZAIN JUDGE HIGH COURT OF MALAYA KUALA LUMPUR For the Plaintiff (suit 336) & Defendants (suit 656): Peter Neik Xiang Cheng together with Jazz Cheah Jeay Ying Neik & Partners (Petaling Jaya) For the Defendants (suit 336) & Plaintiff (suit 656): Tey Hoo Nee Chai & Company (Kuala Lumpur)

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Oishii Wasabi Sdn Bhd v Topz Sdn Bhd (WA-22NCvC-656-11/2023)

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Oishii Wasabi Sdn Bhd v Topz Sdn Bhd (WA-22NCvC-656-11/2023)

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