WA-22NCvC-121-02/2020
High Court of Malaysia24 Jul 2025
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“18. Under the Contracts Act 1950 it is clear that any breach by one party will render the Agreement voidable and the party against whom the breach has occurred has the option to terminate the Agreement.”
“25. Under the Evidence Act 1950 the burden lies upon the Defendant to prove the mutual agreement. Section 103 of the Evidence Act 1950 stipulates that: The burden of proof as to any particular fact lies on that person who wishes t”
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1 DALAM MAHKAMAH TINGGI MALAYA DI KUALA LUMPUR DALAM WILAYAH PERSEKUTUAN, MALAYSIA BAHAGIAN SIVIL NO. GUAMAN SIVIL : WA-22NCvC-121-02/2020 ANTARA CRYSTAL CLEAR CLEANING SDN BHD (NO. SYARIKAT: 726647-A) … PLAINTIF DAN AEON CO. (M) BHD (NO. SYARIKAT: 126926-H) … DEFENDAN JUDGMENT
1
The Plaintiff’s claim against the Defendant is for the wrongful termination of a cleaning agreement entered between the Plaintiff and the Defendant on 27/11/2018 (“the Agreement”).
2
The case proceeded to a full trail where the parties relied on oral testimony of witnesses as well as documents contained in the Bundle of Document filed in Court. 12/09/2025 10:00:31 WA-22NCvC-121-02/2020 Kand. 250 Brief facts
3
Under the Agreement the Defendant had engaged the Plaintiff to provide cleaning services at 14 of the Defendant’s premises for a period of 1 year from 1/10/2018 until 30/9/2019.
4
Before the expiry of the 1 year period the Defendant terminated the Agreement on 13/3/2019. The issue
5
The sole issue in this case is as to the validity of the termination by the Defendant. The facts leading to termination
6
Both parties had led evidence indicating that there were various incidents between the Plaintiff and the Defendant leading to the final termination by the Defendant.
7
The Defendant contended that the Plaintiff had breached the Agreement by failing to perform the cleaning services according to the standard laid down under the Agreement, this included providing foreign employees with illegal working permits as well as sexual harassment by one of the Defendant’s employee.
8
As a result of this breaches a number of letters of discontinuance were issued by the Defendant. The Defendant contends that in the meeting held between the parties the Plaintiff had admitted to the breaches and mutually agreed to discontinue the cleaning services in some of the Defendant’s outlet.
9
The Plaintiff denied having mutually agreed to the discontinuance of the cleaning services in the outlets mentioned by the Defendant.
10
On the contrary the Plaintiff’s had agreed to rectify some of the non-conformity and made efforts to rectify the weaknesses. This is reflected in the correspondence between the parties.
11
The Defendant however allege that the breaches were not rectified after repeated reminders and this led to final mutual termination of the Agreement. The Plaintiff again denied that they had ever mutually agreed to terminate the Agreement. The validity of the termination
12
In the Court’s view any determination of the validity of the termination must be construed within the 4 walls of the Agreement. It is therefore pertinent to consider the clauses in the Agreement relating to termination.
13
The Plaintiff were awarded the cleaning services by virtue of a Letter of Award dated 20/8/2018 for the premises for a period of 12 months commencing from 1/10/2018 and ending on 30/9/2019. The Plaintiff accepted the offer by the Defendant.
14
The acceptance of the offer by the Plaintiff led to the Agreement dated 27/11/2018 between the Plaintiff and the Defendant. The circumstances under which the Agreement could be terminated. Clause 2.2 The first ninety (90) days of the Term shall be consider as the trial period (Hereinafter referred to as “Trial Period”). Without prejudice to the right of the Company contained herein, during the Trial Period, the Company reserves the rights to terminate the Agreement described hereunder by giving fourteen (14) days written notice to the Services Provider in the event that the performance of the Services do not meet the level of performance stipulated in the Agreement. Upon expiry of the said notice, the Agreement shall be terminated and neither party shall have any claim against the other party save and except for any antecedent breaches of the Agreement. If the Agreement is not terminated during the Trial Period, the Agreement shall continue in operation until termination and/or expiration pursuant to the provision of the Agreement.
15
The Defendant in clause 2.2 of the Agreement had full discretion to terminate the Agreement by giving a 14 days’ notice during the Trial period which is the first 90 days of the Agreement.
16
This provision has no application in this case as the termination was after the Trial period had expired and the termination was some 6 months later.
17
The Defendant contends that the various breaches by the Plaintiff had occurred during the Trial period. Even if this is true, in the Court’s view the Defendant had waived their right to terminate, as the Agreement was not terminated at that point of time the breaches occured. The Agreement had been continued to be performed.
18
Under the Contracts Act 1950 it is clear that any breach by one party will render the Agreement voidable and the party against whom the breach has occurred has the option to terminate the Agreement.
19
By not rescinding or terminating the Agreement when the breach had occurred the Defendant is deemed to have agreed to continue with the Agreement. This is clear from section 66 of the Contracts Act 1950 which states that: Every promisee may dispense with or remit, wholly or in part, the performance of the promise made to him, or may extend the time for such performance, or may accept instead of it any satisfaction which he thinks fit.
a
A promises to paint a picture for B. B afterwards forbids him to do so. A is no longer bound to perform the promise.
b
A owes B RM5,000. A pays to B, and B accepts, in satisfaction of the whole debt, RM2,000 paid at the time and place at which the RM5,000 were payable. The whole debt is discharged.
c
A owes B RM5,000. C pays to B RM1,000 and B accepts them, in satisfaction of his claim on A. This payment is a discharge of the whole claim.
d
A owes B under a contract, a sum of money, the amount of which has not been ascertained. A, without ascertaining the amount, gives to B, and B, in satisfaction thereof, accepts the sum of RM2,000. This is a discharge of the whole debt, whatever may be its amount.
e
A owes B RM2,000, and is also indebted to other creditors. A makes an arrangement with his creditors, including B, to pay them a composition of fifty cents in the dollar upon their respective demands. Payment to B of RM1,000 is a discharge of B's demand.
20
In short this provision of termination during the Trial period does not apply in this case. Clause 11.1 AEON may terminate this agreement by serving ninety (90) days’ written notice to the Service Provider upon the occurrence of any of the Insolvency Events without prejudice to any other rights and remedies that AEON may have under this Agreement or at law.
21
Clause 11.1 of the Agreement also gave the Defendant the sole discretion to terminate the agreement by giving a 90 days’ notice upon the occurrence of any of the Insolvency Events.
22
Insolvency Event are defined under Clause 1 of the Agreement. “Insolvency Event” Means: A. a receiver, receiver and manage, trustee, administrator, other controller or similar official is appointed over any of the assets or undertaking of a Party; B. a Party suspense payment of its debts generally; C. a Party is or becomes unable to pay its debts when they are due or is or becomes unable to pay its debts or is presumed to be insolvent; D. a Party enter into or resolves to enter into any arrangement, composition or compromise with, or assignment for the benefit of, its creditors or any class of them; E. a Party ceases to carry on business or in verge of ceasing the business; F. a resolution is passed or any steps are taken to appoint, or to pass a resolution to appoint, an administrator in relation to a Party; or G. an order is made for the winding up or dissolution or a Party, or a resolution for the winding up or dissolution of a Party, otherwise than for the purpose of an amalgamation or reconstruction of which prior written notice has given to other Parties.
23
This Clause has also no bearing to the present dispute as no evidence that any of the Insolvency events of the Plaintiff had occurred nor was this the reason given for the termination. Clause 11.2 This Agreement may be determined by way of mutual agreement between the parties by serving ninety (90) days’ notice to the Service Provider.
24
Clause 11.2 gives an option for the Agreement to be terminated by mutual agreement. The Plaintiff contends that there was a mutual agreement between the parties to terminate the Agreement.
25
Under the Evidence Act 1950 the burden lies upon the Defendant to prove the mutual agreement. Section 103 of the Evidence Act 1950 stipulates that: The burden of proof as to any particular fact lies on that person who wishes the court to believe in its existence, unless it is provided by any law that the proof of that fact shall lie on any particular person.
a
A prosecutes B for theft and wishes the court to believe that B admitted the theft to C. A must prove the admission.
b
B wishes the court to believe that at the time in question he was elsewhere. He must prove it.
26
The Defendant contend that the Plaintiff had agreed to the termination in a meeting on 28/12/2018 and this fact is contained in the letter of discontinuance issued by the Defendant.
27
The Court notes that the Plaintiff had denied by virtue of a letter dated 16/1/2019 that there was a mutual agreement to terminate the Agreement.
28
In the Court’s view a bare statement in the letter issued by the Defendant alluding to an agreement is insufficient proof of the mutual agreement between the Plaintiff and the Defendant and more so when the Plaintiff have denied in writing to such a mutual agreement. The letter is clearly self-serving and cannot be regarded as a proof of mutual termination.
29
In short, the Court finds that the Defendant have failed to discharge the proof in proving any mutual agreement to terminate. The Court therefore rules that the Defendant has no basis to rely on this clause of termination. Breaches committed by the Plaintiff to support termination
30
The Defendant contends that the Plaintiff had committed various breaches under the Agreement which included sexual harassment which is a criminal offense. In this case the Court finds that it is unnecessary to determine whether the breaches were in fact committed by the Plaintiff.
31
The actual issue for determination is whether such breaches justify the termination. The Court looked at the Agreement to determine the intentions of the parties in the event of a breach. The intention of the parties in the event of a breach is envisaged by annexing a schedule to the Agreement indicating the actions and procedures that can be undertaken in the event of a breach.
32
For ease of reference the entire schedule is reproduced here:
Schedule
Schedule 5 Penalty Charges Objective: To maintain high standard of cleanliness and customer satisfaction at each AEON (Client) outlet. A) MANPOWER DEDUCTION FORM - HOUSEKEEPING COMPANY : AEON CO. (M) BHD. MALL/SC: _______________________ MONTH / YEAR : ____________________ STORE:_________________________ DATE AM PM 1 0.0 0.0 0.0 2 0.0 0.0 0.0 3 0.0 0.0 0.0 4 0.0 0.0 0.0 5 0.0 0.0 0.0 6 0.0 0.0 0.0 7 0.0 0.0 0.0 8 0.0 0.0 0.0 9 0.0 0.0 0.0 10 0.0 0.0 0.0 11 0.0 0.0 0.0 12 0.0 0.0 0.0 13 0.0 0.0 0.0 14 0.0 0.0 0.0 15 0.0 0.0 0.0 16 0.0 0.0 0.0 17 0.0 0.0 0.0 18 0.0 0.0 0.0 19 0.0 0.0 0.0 20 0.0 0.0 0.0 21 0.0 0.0 0.0 22 0.0 0.0 0.0 23 0.0 0.0 0.0 24 0.0 0.0 0.0 25 0.0 0.0 0.0 26 0.0 0.0 0.0 27 0.0 0.0 0.0 28 0.0 0.0 0.0 29 0.0 0.0 0.0 30 0.0 0.0 0.0 31 0.0 0.0 0.0 0.0 0 0 0.0 0.0 0 0 0.0 0.0 NO. OF DAY DAILY ATTENDANCE MANPOWER DEDUCTION STAFF (not included off day staff) CONTRACT AM PM DAILY MONTHLY MONTHLY DIFF (+/-) (5%) ACT vs 0.0 0.0 0.0 0.0 0.0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0.0 0.0 0 0 0 0 0.0 0 0 TOTAL DEDUCTION (RM) STAFF DEDUCTION RATE 0 0.00 0 0.00 0 0.00 0.00 Prepared by……………………………………… Admin Staff Verified by……………………………………… Manager/Officer Acknowledge……………………………………… Service Provider B) MACHINERY DEDUCTION FORM – HOUSEKEEPING COMPANY : AEON CO. (M) BHD. MALL/SC: ________________________ MONTH / YEAR : ____________________ STORE:_________________________ NO BIG MACHINERY RATE / PERDAY (12 C DAYS) DAYS ACTUAL vs AMT 1 Ride On Auto Scrubber ARA80 12 0 0.00 2 Ride On Auto Scrubber C85 12 0 0.00 3 Maxi Foam 12 0 0.00 4 Steam Injection Machine JS12VAC 12 0 0.00 5 Ride On Sweeper F872H 12 0 0.00 6 Shark Long Reach Scrubbing Machine 12 0 0.00 7 Mini Scrubber 12 0 0.00 0. TOTAL (A) 00 NO SMALL MACHINERY RATE / PERDAY (6 C DAYS) DAYS ACTUAL vs AMT 1 Dray Vacuum SV 290i 6 0 0.00 2 Wet & Dry Vacuum SWD 1500i 6 0 0.00 3 High Pressure Jet HP 140A 6 0 0.00 4 Manual Floor Scrubber P180 HD 16 6 0 0.00 5 Wind Blower Speed Pro Super 6 0 0.00 6 Back Pack Vacuum 1080 W/6L 6 0 0.00 7 Auto Scrubber 16B Walk Behind 6 0 0.00 8 Auto Scrubber 60L/66 Walk Behind 6 0 0.00 9 Escalator Machine 6 0 0.00 0 0 0. TOTAL (A) 00 1. C) PENALTY CHARGES – HOUSEKEEPING MANPOWER To fulfil and maintain 100% number of manpower each AEON (Client) outlet as per contract Support document: Manpower Attendance & Deduction form Reminder Letter Rate per-offence Termination Minor yes Not 100% more than 14 days Major Yes Not 100% more than 21 days Serious Yes Yes Not 100% more than 30 days 2. MACHINERIES To fulfil and maintain 100% number of manpower each AEON (Client) outlet as per contract Support document: Machineries Deduction form Reminder Letter Rate per-offence Termination Minor yes Not 100% more than 14 days Major Yes Not 100% more than 21 days Serious Yes Yes Not 100% more than 30 days 0.00 TOTAL DEDUCTION (A+B) = RM 3. CONSUMABLE ITEM & CHEMICAL To fulfil and maintain 100% delivered consumable item and chemical, quantity as per contract to each AEON (Client) outlet Support document: Monthly Delivery Order (D.O) Reminder Letter Rate per-offence Termination Minor yes Not 100% more than 1 month Major Yes Not 100% more than 2 month Serious Yes Yes Not 100% more than 3 month 4. QUALITY To fulfil and maintain high standard of cleanliness, tidiness and nice smell referred job task as per contract at each AEON (Client) outlet Support document: Outlet Join Audit result monthly Reminder Letter Rate per-offence Termination Minor yes Result 90%-85% Major Yes RM700 Result 84%-80% / 3 month Minor Serious Yes RM1000 Yes Result less than 80% / 3 month Major 5. PERSONNEL – SERVICE PROVIDER To fulfil and maintain high standard of personnel behavior while working at AEON (Client) outlet Support document: Outlet Incident Report Reminder Letter Rate per-offence Termination Minor yes C1 Offense Major Yes C2 offense / 3 times C1 offense Serious Yes Yes C3 offense / 3 times C2 offense List of Offense: *Company = AEON (Client) 1. C1 (MINOR) Failure to follow established procedures and rules and regulations of AEON Company not classified as misconduct. 2. Failure to follow rules and regulations or instructions concerning safety, health and hygiene. 3. Leaving work or workplace during working hours or early without prior permission or authorization. 4. Failure to punch timecard upon entering or leaving the Company premises. 5. Not wearing clean and presentable uniform during working hours. 6. Late attendance. 7. Quarrelling within the Company premises. 8. Using the Company’s properties or premises for personal purposes without the Company’s authorization. 9. Wasting time in chit chatting and playing handphone during working hours. 10. Any mistake omission, act, behavior, communication (verbal or written) and any other matter not classified elsewhere, deemed by the Company to be minor offence in nature. 1. C2 MAJOR Smoking in place where smoking is prohibited. 2. Negligence or carelessness in the performance of work or negligence in the handling of work or negligence in the handling of open flames or flammable materials or using open flames in places other than where permitted and authorized. 3. Destroying or defacing important notices or circulars or writing graffiti on the walls. 4. Absent from work without reasonable excuse and without approval for two days or less. 5. Failure to comply with the Company’s request to work overtime in cases of emergency without reasonable excuse. 6. Failure to comply with the superior’s instructions, work order or any other act of insubordination. 7. Covering up for a subordinate or fellow employees in cases where disciplinary action would have been required. 8. Falsification of any documents, report or forms in use without resulting in financial loss to the Company. 9. Tampering with identification cards, name tags, badges or other articles of similar nature in use by the Company. 10. Gambling or any other similar activity with / without involvement of cash within Company’s premises. 11. Consumption of alcohol beverages or under the influence of alcohol whilst in Company premises. 12. Arguing with or rude to a customer which may impair the good image of the Company. 13. Failure and negligence in the supervision and guidance in the course of work or a subordinate. 14. Using abusive language against a superior. 15. Any mistake, omission, act behavior, communication (verbal or written) and any other matter not classified elsewhere, deemed by the Company to be Major in nature. 1. C3 (SERIOUS) Working in the company premises without working permit or working permit already expired (foreign workers). 2. Fighting or using physical force against another person in the Company premises as well as in its vicinity. 3. Damaging or destroying Company’s equipment, goods, documents or property either intentionally or though carelessness and/or negligence. 4. Bringing in or possessing any dangerous articles or lethal weapons in Company’s premises not required for the performance of any employee’s work.NOT THE 5. Taking money, gifts and any articles (plus accepting service of any kind of monetary value or entertainment arising out of his / her work without prior permission or authorization of the Company. 6. Tampering / removing any safety devices or equipment or impairing the effective use of such devices or equipment. 7. Causing accidents or injuries due to gross negligence or improper supervision during the course of work. 8. Lending or borrowing money, valuables, articles, equipment or other things of monetary value to / from a supplier of the Company without prior permission of the Company. 9. Changing the selling price of a merchandise without the approval or authorization of a superior. 10. Conducting any personal business in direct conflict with the business activities of the Company with any member of the public during working hours. 11. Intimidating or inciting other employees towards violence or acts in violence against other employees, their families or the Company 12. Bringing into or possessing any narcotics or stimulants prohibited by the law within Company premises. 13. Disclosing confidential Company matters or information to a third party without the approval of the Company or carrying out any act or acts against the Company’s interest. 14. Abusing the position or authority of the individual for personal gain. 15. Consumption of edible products sold by the Company without paying. 16. Falsifying or providing false information knowingly leaving out important details with intent to mislead the Company. 17. Falsifying any documents for whatever reason. 18. Stealing goods, valuables, documents and articles of any description belonging to the Company, fellow employees or other people within or in the vicinity of Company premises or any accessory to theft or attempting theft of Company’s properties. 19. Causing fire or damage to the Company premises or properties through carelessness or negligence. 20. Commission or conviction of any criminal or subversive acts or offence or abetment thereof. 21. Failure or refusal to a search when required to do so by the Company or its agent 22. Falsification of any documents, reports, claims or forms resulting in financial loss to the Company or in the absence of timely preventive action taken by the Company will lead to such financial loss or any general act of falsification. 23. Failure to follow established Procedures and Rules and Regulations of the Company which resulting in financial loss to the Company or in the absence of timely preventive action taken by the Company will lead to such financial loss. 24. Taking periodical medical leave, approved or otherwise, with a view to staying away from work thereby not discharging one’s contractual duties. 25. Absent from work without reasonable excuse and without approval for more than two days. 26. Punching the time card of another employee or asking another employee to punch the timecard. 27. Any unwanted conduct of a sexual nature having the effect of verbal, non-verbal, visual, psychological or physical harassment that might on reasonable grounds, be perceived by the recipient as placing condition of a sexual nature on her / his employment, OR that might on reasonable grounds, be perceived by the recipient as an offence of humiliation, or a threat to her / his well-being but has no direct link to her / his employment. 28. Any mistake, omission, act, behavior, communication (verbal or written) and any other matter not classified elsewhere deemed by the Company to be serious in nature. 33. An important feature of the above schedule is that the various breaches are categorized as minor, major and serious. Even if the Court accepts that the Plaintiff has committed serious breaches the schedule does not give a right to the Defendant a right to terminate immediately. The schedule first provides the duty of the Defendant to issue a reminder letter followed by imposing of a penalty and only then terminate the Agreement. A pre-condition for taking any action is that any step taken must first be accompanied by supporting documents. 34. In this case the Court finds that this steps and procedures have not been followed by the Defendant. No supporting documents accompanied the reminder letters and neither was the option to impose a penalty exercised. 35. It is the Court’s ruling that the inclusion of the schedule precludes termination of the Agreement until all the measures mentioned in the schedule are undertaken. In this case this was not done. Conclusion 36. The Court rules in this case that the termination is invalid and therefore the Plaintiff is to be compensated for the remaining duration of the Agreement of 6 months with the agreed monthly payment. 37. The Court also dismisses the Defendant’s counterclaim and awards a cost of proceeding of RM100, 000 to the Plaintiff. Dated: 9.9.2025 sgd DATO’ HAJI AKHTAR BIN TAHIR Judge High Court of Malaya, Kuala Lumpur PARTIES For the Plaintiff: Nama Peguamcara: Rajwinjit Kaur Khalae A/P Ajit Singh Khalae Tetuan Rahman Zulkhairi A-36-11, Tower A, Menara UOA Bangsar, 5, Jalan Bangsar Utama 1, Bangsar, 59000 Kuala Lumpur, Wilayah Persekutuan Kuala Lumpur. For the Defendant: Nama Peguamcara: R Jayasingam / Dineswary Nadarajah Tetuan B H Lawrence & Co, Unit B11-09, Blok B, Phileo Damansara 2, No.15, Jalan 16/11, Off Jalan Damansara, 46350 Petaling Jaya, Selangor.
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