Subsection
(3) Whether the respondent’s application under O. 81 was fatally flawed for failing to set out or attach thereto minutes of judgment sought pursuant to O. 81 r. 2 of the Rules of Court 2012. 6 OUR DELIBERATIONS AND DECISION [11] First, we bore in mind that this application which was made under O.81 of the Rules of Court 2012 had the same procedural objective as 014 of the same Rules in that it provides for a speedy mechanism for obtaining summary judgment without proceeding to a trial. See Mawar Awal (M) Sdn Bhd v Kepong Management Sdn Bhd (2005) MLJ 132 at page 140. Hence, the court needs to be satisfied that there is no triable issue before the application can be allowed. [12] So, based on the 3 issues raised, is there anything which needs to be ventilated in a full trial? [13] We examined all those 3 issues. On the first issue, it was contended on behalf of the appellant that there was no concluded contract between the appellant and the respondent as the parties had both stated at the outset “unless and until all terms and condition shall be agreed and the formal Sale and Purchase Agreement and Tenancy Agreement executed by the parties thereto, there shall be no concluded and binding contract for the same.” 7 [14] Learned counsel for the appellant cited the case of Masters v Cameron [1950] 91 CLR 353 which was referred to by the Federal Court in Charles Grenier Sdn. Bhd. v Lau Wing Hong [1997] 1 CLJ 625 at pages 632 – 633 as follows: “Where parties who have been in negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three classes. It may be one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will be fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or implied, but nevertheless have made performance of one or more of the terms conditional upon the execution of a formal document. Or, thirdly, the case may be one in which the intention of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract. In each of the first two cases there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the 8 second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution. Meaning no disrespect to Counsel, we consider the applicable principle to be capable of statement in far simpler terms than he has sought to do. An agreement to make an agreement does not result in a contract. It is for the Court in each case to construe the correspondence exchanged between the parties and to say whether that is the result intended by the parties. If the Court reaches an opposite conclusion, then there is an enforceable contract.” [15] Learned counsel also cited the more recent decision of the Federal Court in Deutsche Bank (Malaysia) Bhd. v MBF Holdings Bhd [2015] 8 CLJ 1068 at pages 1085 and 1100, which explained authorities “subject to contract” cases inter alia as follows: “[20] But consensus ad idem on the terms alone is not enough to form a binding contract. “… in order for a promise to be legally enforceable as a contract, it must be intended to be legally binding, or, as it is more often put, the parties must intended to enter into legal relations … the earliest judicial support for such a requirement in case law is in the judgment of Atkin LJ in Balfour v. Balfour [1919] 2 KB 571 … (Butterworths Common Law Series, The Law of Contract 3rd edn at para. 2.169). “The requirement of an intention to create legal relations, additional to the test of bargain, has been repeatedly criticised by academic commentators” (see B.A. Hepple [1970] 28(1) CLJ 122 9 at 127; see also A. W. B. Simpson [1975] 91 LQR 247 at 263-265). But “since the later nineteenth century, it has become common to say that in addition to the existence of an agreement (generally established through offer and acceptance) and consideration, the formation of an informal contract requires evidence of an “intention to create legal relations” – that is, there is a substantive additional requirement that the parties intended their agreement to have legally binding force … Each party agrees not only to the terms of the contract but agrees to it being a contract” (Formation and Variation of Contracts by Cartwright at p. 55). When parties enter into it, there must be an intention to create legal relations (see RTS Flexible Systems Ltd v. Molkerei Alois Muller GmbH & Co KG [2010] UKSC 14; see also Hui Jia Hao v. Perdana Park City Sdn Bhd & Anor [2011] 1 LNS 595; [2012] 8 MLJ 385; Anuiti Enterprise (M) Sdn Bhd v. Cubic Electronics Sdn Bhd [2006] 1 LNS 288; [2006] 6 MLJ 56; Ahmad Zaini Japar v. TL Offshore Sdn Bhd [2002] 5 CLJ 201; [2002] 7 MLJ 604; Jone Theseira v. Eileen Tan Ee Lian & Anor [2003] 5 CLJ 171; [2002] 4 MLJ 629) or in circumstances in which such an intention must be ascribed to them (Beesley v. Hallwood Estates Ltd [1960] 1 WLR 549, at 558; see also Sutton and Shannon on Contracts, 6th edn at p. 54).” ………………………………………………………………………………………… ………………………………………………………………………………………… ………………………………………………………………………………………… [47] To sum up, without consensus ad idem, there is no concluded contract. But consensus ad idem on just the terms is not enough to form a concluded contract. In addition, there must be the intention to create legal relations and 10 consideration. In most commercial agreements, the court will presume that intention (see Contract Law, An Introduction to the English Law of Contract for the Civil Lawyer, by John Cartwright at p. 140), unless there is proof of no such intention. Formality is the exception and not the rule. It does not follow that just because of the expression “subject to contract” there is no concluded contract. But if formality is by choice, it should be made clear that parties are not bound until the execution of a formal agreement. “… if the intention were that what was agreed in the first instance should be the subject to the completion of the formal document, then there was no bargain while that condition remain unfulfilled. Also, of course, there was no agreement if the parties had not agreed on a set of terms at all, either absolutely or conditionally” (Love and Stewart Ltd v. S. Instone and Co Ltd [1917] per Lord Loreburn).” [16] Learned counsel for the respondent, although did not deny the issuance of the letters with the term “subject to contract” however submitted that the letters were issued so as to enable the parties to finalise all the terms and conditions of both the Sale and Purchase and Tenancy Agreements. They were issued with such terms and with an honest intention that neither party shall take an advantage of the other until terms and conditions of the Sale and Purchase and Tenancy Agreements are finalised. Hence, the said terms were only intended for parties to finalise the terms and conditions of the agreements and it is not terms to be incorporated into those agreements. 11 [17] He further submitted that what was important was the email dated 11.5.2016 which we had reproduced above. By asking the respondent’s solicitor to engross the Sale and Purchase and Tenancy Agreements, it was confirmed that all the terms and conditions of both the agreements had mutually crystallized and there was nothing more to add into the terms and conditions of the agreements. [18] The respondent further submitted that all the essential ingredients to form a valid and enforceable contract had been reached, as follows: