Datamicron Systems Sdn Bhd v Datakraf Solution Sdn Bhd (WA-22NCvC-417-07/2022)

The Plaintiff and the Defendant had, on 29th July 2020, entered into a contract which they called a Teaming Agreement (“the Teaming Agreement”) – which is to remain effective for a period of five years (subject to renewal) from the date of the Teaming Agreement, i.e. until 28th July 2025.

The spirit of the Teaming Agreement was for the Plaintiff to assist the Defendant in bidding for government projects, with the Defendant promising to appoint the Plaintiff as its main subcontractor if the Defendant is successful in its bid.

In mid-2021, with the technical support given by the Defendant, the Plaintiff did succeed in securing a government contract with a contractual value of approximately RM13,500,000.00. The 22/09/2025 20:26:31 WA-22NCvC-417-07/2022 Kand. 66 S/N ysxBhWpt2USX3Kf2NCgwlw Defendant did keep its promise to appoint the Plaintiff as its subcontractor. It was undisputed that the Plaintiff did not breach the contract. Unfortunately for both parties, the main contract had to be cancelled and the Defendant was to make a claim from the National Cyber Security Agency (“NACSA”) and to pay the Plaintiff accordingly. The long and the short of it is that that the Defendant did not pay the Plaintiff – which led to the filing of this civil suit by the Plaintiff.

After a full trial, hearing the evidence of witnesses, I find that the Plaintiff has, on a balance of probabilities, succeeded in proving its claim. Thus, I decided that this Court ought to allow the Plaintiff’s claim against the Defendant. The details and my reasons are as explained below. Background Facts 5. The Plaintiff is a private limited company involved in the development of software, offering software solutions and tools for design and development, integration, data warehouse, reporting and analysis, and business intelligence system.

The Defendant is a private limited company in the business of providing services related to information, communication and technology.

As mentioned above, the parties entered into the Teaming Agreement on 29th July 2020. In 2021, the Defendant wanted to bid for a government project known as ‘Perkhidmatan Membekal, S/N ysxBhWpt2USX3Kf2NCgwlw Menghantar, Memasang, Merekabentuk, Membangun, Menguji dan Mentauliah Perkakasn, Perisian dan Sistem Aplikasi Serta Menyelenggara (dalam Tempoh Waranti) untuk Projek Cybercrime Integrated Management System (CIMS), Agensi Keselamatan Siber Negara, Majlis Keselamatan Negara, Jabatan Perdana Menteri’ (“the CIMS Project”).

The Defendant invited the Plaintiff to provide the support to prepare the Proposal related for the CIMS Project. The scope of work of the Plaintiff was as follows: No. Scope of Work and Analytics Solution 1.

Development and

Consulting Services

Training and Certification

Annual Maintenance and Support

Hardware (Optional)

As mentioned above, the Defendant represented to the Plaintiff that pursuant to the terms of the Teaming Agreement, in the event of the Defendant being successful in the tender for the CIMS Project, the Defendant would appoint the Plaintiff as the main subcontractor for the CIMS Project.

The Defendant was successful in securing the contract for the CIMS Project from the National Cyber Security Agency (“NACSA”), the contract price of which was approximately RM13,500,000.00. S/N ysxBhWpt2USX3Kf2NCgwlw GUAMAN NO. WA-22NCvC-417-07/2022 11. At the request of the Defendant, pursuant to Clause 11 of the Teaming Agreement, the Plaintiff submitted its quotation dated 9th July 2021 for the Products and Services under the CIMS Project which was to be subcontracted to the Plaintiff (“the Plaintiff’s Quotation”) in the total sum of RM6,350,000.00.

Even though the Defendant did not sign on the Plaintiff’s Quotation to signify acceptance, it issued the Plaintiff a Purchase Order No. PO-202100013 dated 11th July 2021 for the same sum quoted by the Plaintiff, i.e. RM6,350,000.00, which was duly accepted by the Plaintiff (“the CIMS Subcontract”).

It was undisputed that the Plaintiff did not breach the CIMS Subcontract and it was NACSA that indicated its intention to terminate the CIMS Project.

There was no evidence adduced by the Defendant as to how it ultimately settled with NACSA after informing the Plaintiff to cease work on the CIMS Subcontract; whether NACSA had paid the Defendant based on its claim or had entered into a new contract with the Defendant. The Plaintiff’s Claim 15. The Plaintiff’s two witnesses testified that the Plaintiff had, at all material times, performed all of its contractual duties and obligations as necessitated by the Teaming Agreement and the CIMS Subcontract. S/N ysxBhWpt2USX3Kf2NCgwlw GUAMAN NO. WA-22NCvC-417-07/2022 16. The Plaintiff’s total claim works out to RM2,563,500.00. As the Defendant has paid the Plaintiff only RM200,000.00, the Plaintiff claims RM2,363,500.00 as the amount due and payable.

The Plaintiff’s learned counsel submitted that there are two issues for determination by the Court; first, whether the Defendant is liable to pay the Plaintiff RM2,363,500.00 as the balance for services rendered and/or for losses, expenses, and/or damages suffered by the Plaintiff under the CIMS Subcontract or in the alternative, whether the Defendant had been unjustly enriched and ought to be ordered to recompense the Plaintiff.

The Plaintiff’s claim for RM2,563,500.00 is based on 1,709 man-days and a rate of RM1,500 per man-day; 1,709 x RM1,500 = RM2,563,500.00. Details of how the Plaintiff arrived at 1,709 man-days shall be set out in my analysis below.

Reliance was placed by learned counsel for the Plaintiff on s.71 Contracts Act 1950, Gerbang Perdana Sdn. Bhd. v Mtd Acpi Engineering Berhad & Anor [2015] MLJU 2368, Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] MLJU 33, Tanjung Teras Sdn Bhd v Kerajaan Malaysia [2015] 9 CLJ 1002 and Siow Wong Fatt v Susur Rotan Mining Ltd & Anor [1967] 2 MLJ 118 as authorities to support the Plaintiff’s claim. The Defendant’s Defence 20. Learned counsel for the Defendant submitted that on 12th July 2021, the Defendant had informed the Plaintiff via e-mail that the terms S/N ysxBhWpt2USX3Kf2NCgwlw and conditions in the Plaintiff’s Quotation were unacceptable, and that the terms and conditions in the Defendant’s Purchase Order No. PO-202100013 dated 11th July 2021 (“the Purchase Order”) are the terms and conditions of the CIMS Subcontract.

It was highlighted that the Plaintiff’s CEO, namely, Jimmy Ting (PW1), accepted the Purchase Order on behalf of the Plaintiff by signing on it on 15th July 2021.

The Defendant takes the position that there was no breach of the CIMS Subcontract and that the Plaintiff has failed to justify and/or support its claim that it had purportedly done work with the value of

The Defendant also takes the position that the Plaintiff’s alternative claim of RM3,175,000.00 is likewise untenable, and that the evidence of PW1 shows that the Plaintiff is not pursuing this particular claim.

Learned counsel for the Defendant cited several authorities in support of his submissions, inter alia, Synergy Spectacular Sdn Bhd v Deleum Primera Sdn Bhd [2022] MLJU 216, Majlis Agama Islam Selangor & Anor v Bank Muamalat Malaysia Bhd [2021] 6 CLJ 319, Pembinaan Jaya Zira Sdn Bhd v Majlis Amanah Rakyat [2024] CLJU 1472, Suara Baru Sdn Bhd v Borhill Estates Sdn Bhd [2018] 1 LNS 860, Hasnul Hanis bin Badrul v Allianz General Insurance Co (M) Bhd [2019] 8 CLJ 800 and Cheng S/N ysxBhWpt2USX3Kf2NCgwlw Hang Guan & Ors v Perumahan Farlim (Penang) Sdn Bhd & Ors [1994] 1 CLJ 19. Analysis of the Facts and Law 25. Since both parties agree that the relationship between them began with the Teaming Agreement, it is appropriate to begin by looking at the Teaming Agreement to comprehend their terms of engagement. The preamble of the Teaming Agreement states that the Defendant intends to submit a proposal (“the Proposal”) for the tender for the purpose of securing a contract with the Government. The “Scope of Teaming” as set out in the Teaming Agreement shows full reliance by the Defendant on the Plaintiff to provide the write-up and information pertaining to the Scope of Work to create the Proposal for the Defendant to submit, giving the Plaintiff the responsibility of identifying the most workable and financially effective solutions pertaining to the Scope of Work, and promising to appoint the Plaintiff as the subcontractor for the Scope of Work pertaining to the Project. A screenshot of the Scope of Teaming is pasted below.

As the Proposal which was submitted by the Defendant to NACSA was almost wholly prepared by the Plaintiff without charging the Defendant any fees, it is not surprising that Clause 11 of the S/N ysxBhWpt2USX3Kf2NCgwlw Teaming Agreement contains an equivocal agreement by the Defendant to sub-contract the Scope of Work to the Plaintiff as per the Proposal. The Defendant agreed to issue a ‘Letter of Award’ to the Plaintiff within one week from the date the Defendant receives the award from the Customer, i.e. NACSA. Clause 11 of the Teaming Contract is worded as follows: “Upon successful award of the Project to Datakraf by the Customer, Datakraf agrees to issue ‘Letter of Award’ and sub-contract the Scope of Work to Datamicron as per the proposal submitted by Datamicron to Datakraf. This is to be done within one week from the date Datakraf receives the award from the Customer.”

As for the pricing, the Defendant agreed in Clause 11 that it shall be based on the quotation submitted by the Plaintiff, subject to final negotiations between them. The exact wording is as follows: “The pricing shall be based on the quotation submitted by Datamicron, and subject to the final negotiations between the parties.”

In mid-2021, the Defendant succeeded in its bid for the CIMS project and was awarded by NACSA with a contract value of approximately RM13,500,000.00. This gave the Plaintiff a legitimate expectation, based on the aforesaid Clause 11, to be appointed as the Defendant’s sub-contractor for the Scope of Work as per the Proposal.

As agreed in Clause 11, the Plaintiff submitted its quotation to the Defendant. The Defendant did not sign on the Plaintiff’s quotation to accept the terms stated therein but had issued to the Plaintiff a S/N ysxBhWpt2USX3Kf2NCgwlw Purchase Order dated 11th July 2021, the total sum payable of which is RM6,350,000.00, i.e. as quoted by the Plaintiff. As pointed out by learned counsel for the Defendant, the Plaintiff’s CEO, namely, Jimmy Ting (PW1), accepted the Purchase Order on the Plaintiff’s behalf by signing on it on 15th July 2021, confirming the CIMS Subcontract.

From the evidence adduced during the trial, it is clear that CIMS is abbreviated from the words Cybercrime Integrated Management System. In other words, CIMS is an acronym coined by NACSA. The CIMS Contract awarded to the Defendant (based on the Proposal prepared by the Plaintiff) was for the development of an integrated management system to combat cybercrime. It appears that that the grand idea is to create an online system for enforcement agencies, including the Police (PDRM), the Customs & Excise Department (Kastam), the Insolvency Department (JIM), the Immigration Department (Imigresen), the Domestic Trade and Consumer Affairs Ministry (KPDNHEP), the Malaysia Communication & Multimedia Commission (SKMM), National Registration Department (JPN), etcetera, to upload latest data from their respective investigations, to be made accessible to other enforcement agencies, so as to enable up-to-date information to be used for investigation and enforcement purposes.

Upon examination of the details, I find that under the CIMS Subcontract, the Plaintiff was to cover every aspect of the CIMS Contract except the hardware. In other words, the Defendant’s main role under the CIMS Subcontract was to provide the necessary S/N ysxBhWpt2USX3Kf2NCgwlw hardware for the Plaintiff to carry out its Scope of Work under the CIMS Subcontract. In a nutshell, the Defendant was to provides the hardware while the Plaintiff was to provide the entire solution for the CIMS Subcontract.

As the Defendant had obtained a contract from NACSA for RM13,500,000.00 and was agreeing to pay less than half of it to the Plaintiff, it is not surprising that the Purchase Order contains figures as quoted by the Plaintiff. With the Plaintiff supplying all the software and maintaining the same, the Defendant would still have had a substantial profit from the RM7,150,000.00 (RM13,500,000 less RM6,350,000) after paying for the hardware and other expenses.

The Defendant had stated the term “back-to-back payment” in the Purchase Order. In other words, the Defendant agreed that whenever it receives payment from NACSA, it would make some partial payments to the Plaintiff, which at the end of the day would have resulted in the Defendant receiving a total sum of RM13,500,000.00 and paying the Plaintiff RM6,350,000.00.

The evidence adduced during the trial confirmed that the Plaintiff was in fact performing the main role in the CIMS Contract. I noted from the attendance lists in meetings with NACSA that on every occasion when meetings were held with NACSA, more members of the Plaintiff company (DataMicron) than members of the Defendant company (Datakraf) attended those meetings. The Attendance List for a meeting held on 2nd September 2021 shows that 3 attendees were from the Plaintiff company while there were only 2 attendees S/N ysxBhWpt2USX3Kf2NCgwlw from the Defendant company. A screenshot of the Attendance List (Senarai Kehadiran) pasted below shows the said fact. S/N ysxBhWpt2USX3Kf2NCgwlw GUAMAN NO. WA-22NCvC-417-07/2022 35. The fact that the Plaintiff was performing the lead role is even more obvious from the attendance list of a meeting held with NACSA on 24th September 2021. There was only 1 attendee from the Defendant company (DataKraf) while there were 5 attendees from the Plaintiff company (DataMicron). A screenshot of the Attendance List is shown below.

Evidence of the Plaintiff playing the lead role is again proven from the attendance list of a meeting with the Police Force (PDRM) on 4th October 2021. There were 4 attendees from the Plaintiff company (DataMicron) but there was only 1 attendee from the Defendant company (DataKraf). A screenshot is shown below. S/N ysxBhWpt2USX3Kf2NCgwlw GUAMAN NO. WA-22NCvC-417-07/2022 37. The attendance lists of meetings with NACSA and different government agencies (who shall be the end users of the CIMS products) show that many more of the Plaintiff’s employees attended the same than the Defendant’s employees. The attendance lists and Minutes of two meetings with representatives from the Domestic Trade Ministry and Department of Customs & Excise respectively (at page 2292 & 2332 of Common Bundle of Documents) also show more attendees from the Plaintiff company and that a greater role was played by the Plaintiff in the execution of the CIMS Contract – even though the Plaintiff was supposed to be just a subcontractor.

I find, from the contemporaneous documentary evidence adduced during the trial, that the Defendant was relying almost wholly on the Plaintiff to execute the CIMS Contract that it had entered into with NACSA. Even when meeting officers from SKMM (Suruhanjaya Komunikasi dan Multimedia Malaysia) on 13th October 2021, the Plaintiff had sent as many as 6 representatives whereas the Defendant had only 2 of its staff present. S/N ysxBhWpt2USX3Kf2NCgwlw GUAMAN NO. WA-22NCvC-417-07/2022 39. The following excerpt from the Nota Perbincangan (Notes of Meeting) held with SKMM shows the Plaintiff raising questions for clarification.

On 26th October 2021, the Plaintiff’s staff attended a meeting with JIM (the Insolvency Department) and NACSA, and the next day on 27th October 2021 with SSM (the Companies Commission). On 23rd November 2021, the Plaintiff’s staff attended a meeting with JPN (National Registration Department). All these departments and government agencies were the intended end-users of the CIMS – which stands for CYBERCRIME INTEGRATED MANAGEMENT SYSTEM – and it was necessary to obtain their respective feedback for the creation of the integrated system. There is no doubt that it was not a simple task for the Plaintiff.

As a final illustration to explain why this Court is constrained to accept the documentary evidence adduced by the Plaintiff as S/N ysxBhWpt2USX3Kf2NCgwlw overwhelming evidence of the time and efforts contributed by the Plaintiff, a screenshot of the Attendance List on 30th November 2021 is pasted below, which shows that the Plaintiff (DataMicron) sent as many as 8 of its staff for the meeting with NACSA, while there were only 2 attendees from the Defendant company (DataKraf).

As I perused the documents in the Common Bundle of Documents, the contents convinced me that the Plaintiff had dutifully performed its part of the CIMS Subcontract. I also find the fact that the Plaintiff’s staff were present in full force in all meetings called by NACSA with various government departments and agencies to be evidence of the Plaintiff’s commitment to the CIMS Project.

There is no evidence of the Plaintiff failing to perform the CIMS Subcontract. In fact, the evidence proved that the Plaintiff was progressing well with the task of creating the software for the CIMS S/N ysxBhWpt2USX3Kf2NCgwlw Project after spending hours with the respective government agencies and labouring on it. Had the Defendant performed its part by January 2022, i.e. making available the hardware, the parties could have conclusively proven to NACSA the advance level of the Plaintiff’s work on the CIMS Project. Unfortunately, NACSA called a meeting which was attended by representatives of both the Plaintiff and the Defendant on 11th January 2022 and proposed to terminate the CIMS Contract with the Defendant due to some extraneous reasons. At this juncture, it is appropriate for me to highlight that there is no cogent evidence adduced during the trial about the final outcome of negotiations between the Defendant and NACSA; as to whether NACSA actually terminated the CIMS Contract with the Defendant and the amount of compensation paid to the Defendant or whether the CIMS Contract was novated by NACSA awarding the Defendant a new contract with a consideration of about

I am of the view that when NACSA had indicated its intention on 11th January 2022 to terminate the CIMS Contract with the Defendant, there were two possible approaches open to the Defendant then. First, the Defendant could have acted, in the spirit of the Teaming Agreement, to regard the Plaintiff as a team partner to submit its claim to NACSA and to share with the Plaintiff whatever payment and/or novation benefits agreed to be paid and/or given by NACSA. This approach would have required transparency on the part of the Defendant, especially when the Purchase Order issued by the Defendant had stated an undertaking by the Defendant for “back-to S/N ysxBhWpt2USX3Kf2NCgwlw back payments” to be made to the Plaintiff, i.e. to share with the Plaintiff whatever the Defendant receives from NACSA.

The evidence shows that the Plaintiff did submit its claim to the Defendant, for the Defendant to submit the same to NACSA. Legally, the Plaintiff could claim only through the Defendant because there is no privity of contract between the Plaintiff and NACSA – even though NACSA was aware that the Plaintiff had expended much time and effort in attending numerous meetings with NACSA and other government agencies, and was creating the software required for the CIMS Project. Since there is no statute in our country similar to the UK Contracts (Rights of Third Parties) Act 1999 or the Construction Industry Payment and Adjudication Act 2012, the Plaintiff may only seek payment from the Defendant and has no cause of action against NACSA.

The Defendant rejected the claim that was submitted by the Plaintiff sometime in February 2022. Thereafter, the Plaintiff was not invited to attend any further meetings held between NACSA and the Defendant. The Plaintiff’s witness testified that he subsequently received news that the Defendant would continue to be a contractor of NACSA, with terms and conditions to the benefit of the Defendant. Even though such evidence is hearsay, the pertinent point is that there was no information provided by the Defendant regarding its settlement with NACSA.

The evidence shows that the Defendant withheld from the Plaintiff the details of its settlement with NACSA. Instead of S/N ysxBhWpt2USX3Kf2NCgwlw divulging the details in order to settle amicably with the Plaintiff, the Defendant attempted, by its conduct in May 2022, to exclude the Plaintiff totally from involvement in the CIMS Contract (or any novated contract).

It became known to the Plaintiff (when it was mentioned by the NACSA during the meeting held with NACSA on 11th January 2022) that the Defendant had received RM700,000 from NACSA in 2021. Thus, it is safe to surmise that the Defendant paid the Plaintiff only RM200,000 out of the RM700,000 received in 2021 from NACSA. There was no official termination letter issued by the Defendant to the Plaintiff to terminate the CIMS Subcontract even though the Plaintiff was directed to halt its work. There was also no offer by the Defendant for settlement of the Plaintiff’s claim.

Learned counsel for the Defendant cited Suara Baru Sdn Bhd v Borhill Estates Sdn Bhd (supra) and a few other authorities to reiterate the principle that the burden of proof is at all times on a plaintiff to prove his case. Based on the evidence as analysed above, I find that the Plaintiff has tipped the balance of probabilities in its favour. In the circumstances, it is the judgment of this Court that the Defendant acted in breach of the Teaming Agreement and also in breach of the CIMS Subcontract. Next, I move on to the quantum to be awarded to the Plaintiff.

As mentioned at the outset, the Plaintiff’s claim for RM2,563,500.00 is based on 1,709 man-days and a rate of RM1,500 per man-day; 1,709 x RM1,500 = RM2,563,500. The Defendant has opposed this S/N ysxBhWpt2USX3Kf2NCgwlw claim by averring, inter alia, that the Purchase Order did not contain any terms for calculation by way of man-days.

In his evidence-in-chief, the Defendant’s witness (DW1) testified that the Plaintiff did not deliver the completed software under the heading “A. Software” of the Quotation, and did not make a claim for the same in its summary of work allegedly done. I find that it is not surprising that the Plaintiff did not claim for Software because even though RM800,000 (RM550,000.00 + RM250,000.00) was agreed as the price for “Software” in the Purchase Order issued by the Defendant (see screenshot below), the CIMS Project did not reach the stage for the Plaintiff to handle over the software.

However, I am constrained to reject the evidence of the Defendant witness (DW1) that “the Plaintiff did not initiate any work in relation to “C. Development” and “D. Others”” with reference to the Quotation issued by the Plaintiff. I find the 1,652 pages of documents which were sent by the Plaintiff to the Defendant via an e-mail on 1st February 2022 to be evidence of substantial work performed by the Plaintiff for the CIMS Project (see the email at S/N ysxBhWpt2USX3Kf2NCgwlw page 1570 of Bundle B4 and the supporting documents from page 1580 to 3230 of Bundles B4 to B9).

In the Purchase Order issued by the Defendant, a sum of RM2,000,000.00 was to be paid to the Plaintiff for the development of the Cybercrime Integrated System and RM1,040,000.00 for professional services to integrate the CIMS with 7 agencies. Even though only 7 agencies, namely JPN, JIM, KPDNHEP, SSM, BNM and PDRM were specifically mentioned, it is noted that the Plaintiff was asked to include SKMM, i.e. the Malaysia Communication & Multimedia Commission as well (see para 38 above). In other words, the Plaintiff was performing every bit of the CIMS Subcontract until it was directed to halt. A screenshot of the relevant part of the Purchase Order issued by the Defendant is pasted below:

The terms and conditions stipulated by the Defendant at the bottom of its Purchase Order are very brief. A screenshot is pasted below: S/N ysxBhWpt2USX3Kf2NCgwlw

As could be seen above, the above terms and conditions in the Purchase Order did cater for the event of breach of contract by the Plaintiff. It requires the Plaintiff to pay Liquidated Ascertained

Damages (“LAD”) for delay by the Plaintiff at a high rate of BLR + 5%. “BLR” was also defined as the interest rate issued by a commercial bank. However, those very brief terms and conditions in the Purchase Order did not cater for the event of breach of contract by the Defendant. It was left open. Hence, is the Plaintiff to be awarded the sum of RM3,040,000.00 as damages for breach of the CIMS Subcontract, i.e. the full sum of RM2,000,000.00 for the development of the Cybercrime Integrated System and the full sum of RM1,040,000.00 for professional services to integrate the CIMS with 7 government agencies? The answer is in the negative as it would cause unjust enrichment of the Plaintiff since the Plaintiff had yet to fully complete the development of the Cybercrime Integrated System and/or to fully professional services to integrate the CIMS with the 7 government agencies.

I find that s.71 of the Contracts Act 1950 and the judgment of the Court of Appeal in Tanjung Teras Sdn Bhd v. Kerajaan Malaysia S/N ysxBhWpt2USX3Kf2NCgwlw (supra) provide guidance for the issue of quantum in this case. First, S.71 states: “Where a person lawfully does anything for another person, or delivers anything to him, not intending to do so gratuitously, and such other person enjoys the benefit thereof, the latter is bound to make compensation to the former in respect of, or to restore, the thing so done or delivered.”

In Tanjung Teras Sdn Bhd v. Kerajaan Malaysia (supra), the Court of Appeal pointed out that s.71 Contracts Act 1950 is not based on any existing contract between the parties. Numerous authorities were cited by the Court in justifying its decision to rule as follows: “[31] Section 71 is the statutory embodiment of the common law principle of quantum meruit, which provides for a just compensation as the measure of the work done as opposed to contractual damages (see: Siow Wong Fatt, Craven-Ellis v. Cannons Ltd [1936] 2 KB 403, Delpuri-Harl Corp JV Sdn Bhd v. Perbadanan Kemajuan Negeri Selangor [2014] 1 LNS 1075; Spatial Ventures Sdn Bhd v. Twintech Holdings Sdn Bhd [2013] 1 LNS 729; [2014] 8 MLJ 14). [32] Liability under s. 71 is not based on any existing contract between the parties. Rather it is based on the equitable principle of conscionable conduct and restitution to prevent unjust enrichment by one party at the expense of another party (see: Ramkrishna Shankarrao v. Rangoobai and anr AIR 1959 Bom 519; (1958) 60 BOMLR 459, Abu Mohammed v. Mohammed Kunju Lebba (1995) S/N ysxBhWpt2USX3Kf2NCgwlw DMC 316 and Pallonjee Eduljee and Sons v. the Lonavala City

Since the said s.71 is a legal principle within the Contracts Act 1950 – which is a statute specially enacted on contracts – I hold the view that it is reasonable to argue that s.71 is applicable to contractual situations as in the present case where there is a breach of contract but the contract does not contain any provision to deal with a breach of contract by one of the parties. As the Court of Appeal in Tanjung Teras Sdn Bhd (supra) put it (as quoted above): s.71 is based on the equitable principle of conscionable conduct and restitution to prevent unjust enrichment by one party at the expense of another party. In our case, the Defendant would be unjustly enriched if the Court does not order it to recompense the Plaintiff.

Learned counsel for the Defendant sought to rely on Pembinaan Jaya Zira Sdn Bhd v Majlis Amanah Rakyat [2024] MLJU 1568 as authority to submit that the “man-month method” for calculation of abortive fees was rejected by the High Court. With respect, the facts of that case actually show that the High Court allowed the plaintiff’s claim despite the defendant submitting that the plaintiff’s claim ought to be dismissed on the ground that the Plaintiff was unable to adduce documents that are needed for calculation based on man-month method. Pembinaan Jaya Zira Sdn Bhd (supra) is not an authority to reject the man-month or man-day method of calculation. The relevant passage is as follows: “[87] In so far as the man-month issue is concerned, the Plaintiff had provided its reasons in the letters as referred under the 1st Issue S/N ysxBhWpt2USX3Kf2NCgwlw as to why it could not calculate the abortive fees by using the man-month method. When asked in re-examination as to what documents are needed before any calculation based on man month can be made, PW2 answered, “…rekod-rekod tentang berapa hari bekerja ataupun berapa jam pihak kakitangan konsultan atau perunding peruntukkan bagi penyediaan dokumen tersebut. … time sheet, sekurang-kurangnya.” (emphasis added)

Before I proceed further to discuss whether the Plaintiff’s claim which is based on “man-days” and a rate of RM1,500 per man-day is justifiable, it is necessary to examine the definition of “man-day”. A man-day is simply a unit of measurement, referring to the amount of work that one person does in one day. In layman terms, if a team of three people took five full working days to finish a project, it means that the project had required (3 x 5 = 15) fifteen man-days.

As already mentioned above, RM2,000,000.00 was stated in the Purchase Order for professional services for Development of Cybercrime Integrated Management System and RM1,040,000.00 for professional services to integrate the CIMS with 7 government agencies. The details of work done (as shown in the table submitted by the Plaintiff) show that much time and efforts had been expended by the Plaintiff between 1st July 2021 and 10th January 2022 to work on the CIMS Project for the Defendant. The following screenshots are self-explanatory. S/N ysxBhWpt2USX3Kf2NCgwlw S/N ysxBhWpt2USX3Kf2NCgwlw S/N ysxBhWpt2USX3Kf2NCgwlw

I find that even though it was not expressly agreed for calculation of damages payable to the Plaintiff in the event of breach by the Defendant to be in terms of “man-days”, the details given by the Plaintiff are sufficient to justify the Plaintiff’s claim. I reiterate that the attendance lists – as referred to in para 34 to 41 above – show that the Plaintiff had indeed committed many man-days to the CIMS Project and had continued to work on it until it was told by the Defendant to halt, and without any information whatsoever about the Defendant’s settlement or novation or payments received from

By reason of the law and evidence as analysed above, this Court finds, on a balance of probabilities, that the Plaintiff has proven that a total of 1,709 man-days had been incurred.

The Plaintiff’s explanation of its calculation is found in its witness PW1’s answer to Question No.50 of his witness statement. There he explained that the range of charges per man-day in the IT industry is between RM1,200 to RM2,500 per man-day. The Defendant failed to challenge this averment during cross-examination of the Plaintiff’s witness (PW1). There was also no evidence led by the Defendant to rebut the Plaintiff’s evidence on S/N ysxBhWpt2USX3Kf2NCgwlw this point. Thus, this Court finds that RM1,500 per man-day, as claimed by the Plaintiff, is a fair and reasonable rate.

The Plaintiff has prayed for exemplary damages to be awarded too. With respect, I find no basis to award any exemplary damages. Cheng Hang Guan & Ors v Perumahan Farlim (Penang) Sdn Bhd & Ors (supra) made it amply clear that exemplary damages may be awarded only in three categories of cases. The present case is not one of them. It was held as follows: "In a famous passage in his judgment in Rookes v Barnard 88, Lord Devlin, with the unanimous approval of all his brethren, reviewed the law and laid down that exemplary damages could only be awarded in three categories of cases; namely, oppressive action by officers of the Crown; secondly, cases where a defendant with a cynical disregard for a plaintiff's rights has calculated that the money to be made out of his wrongdoing will probably exceed the damages at risk; and thirdly, where statute expressly authorized it."

Likewise, I find no substantial basis for the Plaintiff to pray for Aggravated Damages in this case. It was held in Sambaga Valli a/p KR Ponnusamy v Datuk Bandar Kuala Lumpur [2018] 1 MLJ 784, that for aggravated damages to be justified – which is a species of compensatory damages awarded as additional compensation – there must have been intangible injuries to the interest or personality of the plaintiff exacerbated by the exceptional conduct of the defendant. There is no evidence to support the Plaintiff’s plea for aggravated damages even though the Defendant had also breached the Teaming Agreement, which is in force for 5 years S/N ysxBhWpt2USX3Kf2NCgwlw till 28th July 2025. The Plaintiff has not met the requirements for Aggravated Damages to be awarded.

In conclusion, prayer (1) of the Statement of Claim for a Declaration that the Defendant has breached the CIMS Subcontract is allowed. Prayer (3) & (4) of the Statement of Claim are allowed, for damages of RM2,363,500.00, together with interest at 5% per annum from the date of judgment till date of payment, to be paid by the Defendant to the Plaintiff. The sum of RM2,363,500.00 is derived from 1,709 man-days multiplied by RM1,500 = RM2,563,500 less the RM200,000 that was paid to the Plaintiff in year 2021. Lastly, costs of RM50,000 is to be paid by the Defendant to the Plaintiff. Date of Decision: 30th May 2025. S/N ysxBhWpt2USX3Kf2NCgwlw Counsel for the Plaintiff: Bahari Yeow Tien Hong (Lee Hon Jinn with him) SOLICITORS FOR THE PLAINTIFF: MESSRS ROSLI DAHLAN SARAVANA Advocates & Solicitors Level 16, Menara 1 Dutamas, Solaris Dutamas, No.1, Jalan Dutamas 1, 50480 KUALA LUMPUR. Counsel for the Defendant: Jasvinder Singh A/L Surinder Singh SOLICITORS FOR THE DEFENDANT: MESSRS ASYRAF, VIVEK & WEE Advocates & Solicitors F-2-9, Boulevard Commercial Business Park 115, Jalan Kepayang, Off Jalan Kuching, 51200 KUALA LUMPUR. S/N ysxBhWpt2USX3Kf2NCgwlw

Gerbang Perdana Sdn. Bhd. v Mtd Acpi Engineering Berhad & Anor [2015] MLJU 2368.

Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] MLJU 33.

Tanjung Teras Sdn Bhd v Kerajaan Malaysia [2015] 9 CLJ 1002.

Siow Wong Fatt v Susur Rotan Mining Ltd & Anor [1967] 2 MLJ 118.

Synergy Spectacular Sdn Bhd v Deleum Primera Sdn Bhd [2022]

Majlis Agama Islam Selangor & Anor v Bank Muamalat Malaysia Bhd [2021] 6 CLJ 319.

Pembinaan Jaya Zira Sdn Bhd v Majlis Amanah Rakyat [2024]

Suara Baru Sdn Bhd v Borhill Estates Sdn Bhd [2018] 1 LNS 860.

Hasnul Hanis bin Badrul v Allianz General Insurance Co (M) Bhd [2019] 8 CLJ 800.

Cheng Hang Guan & Ors v Perumahan Farlim (Penang) Sdn Bhd & Ors [1994] 1 CLJ 19.

Sambaga Valli a/p KR Ponnusamy v Datuk Bandar Kuala Lumpur [2018] 1 MLJ 784

Section 71 of the Contracts Act 1950. S/N ysxBhWpt2USX3Kf2NCgwlw