Klangcapital Development Sdn Bhd v Chew Beng Hean [Sebagai Pelaksanaan Harta Pusaka Ang Pee (No. K/p: 430209-10-5250) Simati] (BA-22NCvC-341-08/2019)

CHEW BENG HEAN (NRIC NO: 680713-10-6043) [As the executor of the estate of Ang Pee (NRIC NO.:430209-10-5250),

CHEW YEE SENG

TEE KIAT SEONG @ KE SIONG

TIOE CHING KUN

ADRIAN YAP HUAN HWANG (NRIC NO: 920521-10-5943) [As the executor of the estate of Yap Lian Ann

YAP LIAN TIONG

CHEW CHOON KIAT (NRIC NO.:710921-10-5509) [As trustee for Chew Beng Hean (NRIC NO.: 680713-10-6043), Chew Boon Ooi (NRIC NO.: A1386369), Chew Cheng Hwee (NRIC NO.: 24/09/2025 16:26:55 BA-22NCvC-341-08/2019 Kand. 392 S/N rCSxt2pjHEmmvSmm7iBsng 2 651009-10-6637), Chew Cheong (NRIC NO.: 640103-10- 7261), Chew Choon Kiat (NRIC NO.: 710921-10-5509) and Chew Kang Han (NRIC NO.: 670122-10- 5023)]

CHEW YEE SENG (NRIC NO.: 620429-10-5751) [As trustee for Chew Beng Hean (NRIC NO.: 680713-10-6043), Chew Boon Ooi (NRIC NO.: A1386369), Chew Cheng Hwee (NRIC NO.: 651009-10-6637), Chew Cheong (NRIC NO.: 640103-10- 7261), Chew Choon Kiat (NRIC NO.: 710921-10-5509) and Chew Kang Han (NRIC NO.: 670122-10- 5023)]

MESSRS. JY HUANG & ASSOCIATES (sued as a firm) …DEFENDANTS

XUN HONG HARDWARE SDN BHD

MORTRADE SDN BHD

PESURUHJAYA TANAH

FLEXIDYNAMIC ENGINEERING SDN

HEVEAPLAST (M) SDN BHD

AERO METAL FABRICANT SDN BHD (COMPANY NO.: 287481-D) S/N rCSxt2pjHEmmvSmm7iBsng

LONGJOY WEAVING FABRICATED SDN BHD (COMPANY NO.: 746672-A) …3RD PARTIES XUN HONG HARDWARE SDN BHD (COMPANY NO.: 336305-U) …1ST THIRD PARTY KIARA SUSILA SDN BHD (COMPANY NO.: 796665-A) …4TH PARTY

MORTRADE SDN BHD

HEVEAPLAST (M) SDN BHD

AERO METAL FABRICANT SDN BHD (COMPANY NO.: 287481-D) …2ND THIRD PARTY … 5TH THIRD PARTY … 6TH THIRD PARTY KIARA SUSILA SDN BHD (COMPANY NO.: 796665-A) …4TH PARTY FLEXIDYNAMIC ENGINEERING SDN BHD (COMPANY NO.: 1022906-K) …4TH THIRD PARTY WWRC MALAYSIA SDN BHD (COMPANY NO.: 220766-D) …… 4TH PARTY S/N rCSxt2pjHEmmvSmm7iBsng GROUNDS OF JUDGMENT INTRODUCTION [1] This is a writ action brought by the plaintiff against the 1st to 8th defendants (“D1 to D8” or “the Vendors”) for breach of contract and against the 9th defendant (“D9”) for breach of stakeholder duty. [2] The plaintiff is a property development company. It is the purchaser of the land held under Geran 154007, Lot 2355 Mukim Tanjong Dua Belas Daerah Kuala Langat, Negeri Selangor (“the Land”). [3] D1 to D8 were the registered proprietors and vendors of the Land. D9 is the firm of solicitors who had acted for the D1 to D8 in the sale of the Land to the plaintiff. [4] The D1 to D8 brought in seven third parties, who are the owners of the eight neighbouring lots. The 1st, 2nd, 5th and 6th third parties brought in two subsequent parties, who referred to as the “fourth parties”. [5] Prior to the commencement of trial, all the parties — the plaintiff, the defendants, the third parties and the fourth parties — agreed that the trial is to proceed first with the main suit (as between the plaintiff and D1 to D9), and that the third-party actions are to commence only if the main suit is decided in favour of the plaintiff against the D1 to D9. This Court allowed the parties in the trial of the main suit to refer to documents filed in by the parties in the main suit and in the third-party proceedings. KEY BACKGROUND FACTS [6] The plaintiff is a property development company. D1 to D8 are the owners of the Land. The Land is vacant piece of land measuring approximately 8.0937 hectares. S/N rCSxt2pjHEmmvSmm7iBsng [7] Before 04.03.2015, Mr Gan Thiam Kok (“Mr Gan”) and Mr. Pung See Hua (“PW1”) had visited the Land. Mr. Gan is a director and founder of the plaintiff, whereas PW1 is a shareholder and officer of the plaintiff. [8] After the visit, on 04.03.2015, Mr. Gan in his personal capacity, made an offer to D1 to D8 to purchase the Land for the sum of RM10,080,977.00 (“LOA”). [9] Mr. Gan stated in the LOA that Messrs. Soo Thien Ming & Nasrah (“STMN”) as “my solicitors”, and STMN in their letter dated 05.03.2015 to the Vendors stated that they acted for Mr. Gan in respect of the LOA. The LOA was made subject to, among others, the parties executing a sale and purchase agreement within 30 days from the Vendors’ acceptance of the offer. [10] On 09.03.2015, the plaintiff’s surveyor conducted a survey on the Land. A survey plan was commissioned based on the survey on 09.03.2015 (“1st survey plan”). [11] The hardcopy and the softcopy of the 1st survey plan were delivered to the plaintiff on or around 19.03.2015, which was approximately 1 ½ months before the parties entered into the SPA. The hard copy of the 1st survey plan adduced during the trial (at bundle B6/p.372) shows that the 1st survey plan was computed, drawn and checked by a licensed surveyor on 19.03.2015. [12] The encroachment by the third parties complained by the plaintiff — the basis of the dispute between the parties — was shown on the 1st survey plan. [13] On 28.04.2015, the plaintiff and D1 to D8 entered into a sales and purchase agreement (“SPA”), where D1 to D8 agreed to sell to the plaintiff S/N rCSxt2pjHEmmvSmm7iBsng and the plaintiff agreed to buy the Land for a total purchase price of RM10,080,997.00. The plaintiff was represented by STMN and D1 to D8 were represented by D9 in the sale and purchase transaction. Although the LOA was made by Mr. Gan, it was the plaintiff who had entered into the SPA with D1 to D8. [14] The plaintiff made the following payments on the following dates towards the purchase price of the Land:

Sum (RM)

03.2015 2% earnest deposit 201,619.94 20.04.2015 Balance 8% deposit 806,479.76 09.01.2018 Differential sum 2,072,897.00 14.02.2018 Balance of purchase price 7,000,000.00 [15] The payments of the differential sum of RM2,072,897.00 and the balance of the purchase price of RM7,000,000.00 were made to D9 as stakeholder. [16] On 25.01.2018, the plaintiff was registered as the proprietor of the Land i.e. before the balance of the purchase price was released to D9. [17] In a letter dated 26.02.2018, STMN informed D9 that vacant possession of the Land is deemed delivered to the plaintiff in accordance with clause 10 of the SPA. It asked D9 to advise on the apportionment of the quit rent payable by the plaintiff. An image of STMN’s letter of 26.02.2018 is produced below: S/N rCSxt2pjHEmmvSmm7iBsng [18] D9 in its reply on the same date, informed STMN that vacant possession of the Land was deemed delivered to the plaintiff on 15.02.2018. D9 informed STMN that the amount of apportionment of the outgoing quit rent was RM399.28. S/N rCSxt2pjHEmmvSmm7iBsng [19] On 05.03.2018, Mr Gan informed D4 that the neighbouring lots (Lots 222, 223, 224, 226, 227, 228, 231 & 234) had by reason of a low wall / chain link fence encroached into the Land. [20] On 06.03.2018, STMN informed D9 that the occupants of the neighbouring lots had encroached onto the Land, and that Mr Gan had given D4 a copy of the survey plan. STMN asked D9 to advise D1 to D8 to remove the encroachment. [21] In letters dated 07.07.2018 to 12.09.2018, STMN made six further demands for D1 to D8 to remove the encroachment and hand over vacant possession. The plaintiff made a final demand on 10.10.2018 through its solicitors, Messrs. Rhiza & Richard, to remove the encroachment. [22] On 30.10.2018, the plaintiff wrote to the proprietors of the neighbouring lots to remove the encroachment. Of the eight neighbouring lots:

the plaintiff reached agreement with the proprietors of Lots 226, 227, 228, 231 and 234 to remove the encroachment from the subject land; and

the plaintiff commenced action against the proprietors of Lots 222, 223 and 224 to remove the encroachment at the Shah Alam High Court. [23] The proprietor of Lot 223 agreed on 02.04.2019 and the proprietor of Lot 222 agreed on 09.04.2019 to remove their encroachment. [24] On 07.08.2019, the plaintiff filed this writ action against D1 to D8 for breach of the SPA and against D9 for breach of stakeholder duty. S/N rCSxt2pjHEmmvSmm7iBsng [25] The proprietor of Lot 224 entered into a consent order with the plaintiff on 05.02.2020 to remove the encroachment. THE PLAINTIFF’S CLAIM Against D1 to D8 [26] The plaintiff claims that D1 to D8 had breached clause 10 of the SPA by failing to deliver vacant possession of the land by 23.02.2018 and are therefore liable to pay the plaintiff interest for late delivery of vacant possession. [27] The plaintiff’s claim against D1 to D8 arose from their alleged failure to deliver vacant possession of the land free from occupants, as stipulated under clause 10(a) and for late payment interest under clause 10(b) of the [28] The plaintiff contends that vacant possession of the land was not delivered on or before 23.02.2018, as there were occupants present on the land. According to the plaintiff, these occupants were the eight neighbouring lots, whose chain link fence and/or low walls had encroached onto the land. [29] Additionally, the plaintiff asserts that due to D1 to D8's failure to remove the encroachment, it was left with no choice but to undertake steps to remove the encroachment in order to mitigate its losses. Against D9 [30] The plaintiff’s claim against D9 is for breach of stakeholder duty under clause 8 of the SPA and for late payment interest under clause 10(b) of the SPA. S/N rCSxt2pjHEmmvSmm7iBsng [31] The plaintiff pleads that D9 breached its stakeholder duty by releasing the balance of the purchase price before delivery of vacant possession of the land. It contends by releasing the balance of the purchase price before the delivery of vacant possession, D9 deprived the plaintiff of the interests for late vacant possession. Reliefs sought by the plaintiff against D1 to D9 [32] The plaintiff sought the following reliefs against D1 to D9:

D1 to D9, jointly and severally, pay the plaintiff the sum of RM1,171,035.00 (RM2,209.50 x 530 days) for interest from 24.02.2018 until 07.08.2019;

D1 to D9, jointly and severally, pay the plaintiff late delivery interests of RM2,209.50 per day from 08.08.2019 until the date when the encroachment and occupation of the Land caused by Lot 224 ceased;

D1 to D9, jointly and severally, pay the plaintiff the costs incurred by the plaintiff in removing the encroachment;

Interest at the rate of 5% per annum on (a), (b) and/or (c) from the date an order is made until full settlement;

Costs; and

Any such further and other relief that this Court may deem fit and proper to grant in the circumstances. D1 to D8’s DEFENCE [33] D1 to D8 assert that vacant possession of the Land was delivered to the plaintiff on 14.02.2018, prior to the stipulated deadline of 23.02.2018. S/N rCSxt2pjHEmmvSmm7iBsng [34] They further claim that the plaintiff was aware of the encroachment on the Land from the 1st survey plan prior to entering into the SPA but did not disclose this to D1 to D8 until 05.03.2018, i.e. after vacant possession of the Land had been delivered to the plaintiff. [35] Additionally, D1 to D8 argue that the plaintiff had waived its right and is estopped from demanding that they remove the encroachment, as the plaintiff was aware of the encroachment and had initiated legal action against the eight neighbouring lots to remove the encroachment. [36] Furthermore, the proprietors of 7 out of the 8 neighbouring lots i.e. Lots 222, 223, 226, 227, 228, 231 and 234 had agreed to remove the encroachment, prior to the plaintiff filing this writ action against the defendants. And the proprietor of the 8th neighbouring lot (Lot 224) had entered into a consent order with the plaintiff on 05.02.2020 to remove the encroachment. [37] D1 to D8 contend that allowing the plaintiff’s claim would unjustly enrich the plaintiff. Nonetheless, if this Court allows the claim, they argue that the calculation should be based on the encroached area only. D9’s DEFENCE [38] D9 denies that clause 10(b) of the SPA imposes a duty on D9 to hold on to the balance of purchase price and/or to deduct such amounts as necessary to settle the penalty for late delivery of vacant possession. [39] D9 pleads that the plaintiff became the legal and registered owner of the Land as of 26.01.2018. Following the registration, D9 received the balance of the purchase price on 14.02.2018. S/N rCSxt2pjHEmmvSmm7iBsng [40] After receiving payment of the balance of the purchase price, D9 was instructed by D4 that vacant possession of the Land had been delivered to the plaintiff on 14.02.2018. Hence, in accordance with clause 8 of the SPA, D9 released the balance of the purchase price to D1 to D8 on 15.02.2018. [41] Moreover, by a letter dated 26.02.2018, the plaintiff’s solicitors, STMN, confirmed that vacant possession of the Land was deemed delivered to the plaintiff in accordance with clause 10 of the SPA. [42] D9 pleads that the plaintiff’s solicitors’ action on 26.02.108, confirming the delivery of vacant possession, authorized D9 to release the balance purchase price. [43] Further or in the alternative, D9 pleads that in the event that it was in breach of its duty, such a breach had been waived, cured and/or mitigated by STMN’s confirmation on 26.02.2018 that vacant possession of the Land was deemed delivered. Therefore, the plaintiff is estopped from resiling from its position that vacant possession of the land was deemed delivered. [44] D9 further argues that:

the delivery of vacant possession of the Land is independent of whether there were occupiers on the land;

the plaintiff was not prevented from entering the Land after 14.02.2018; and

in accordance with clauses 10(a) and 11(a) of the SPA, the land — upon delivery of vacant possession — was in same state and condition as when inspected by the plaintiff as at the date of the S/N rCSxt2pjHEmmvSmm7iBsng [45] Furthermore, D9 pleads that in the event of failure to deliver vacant possession, the plaintiff is not entitled to the full sum of the penalty as stipulated under clause 10(b) of the SPA. D9 argues that the burden rests on the plaintiff to prove its entitlement to, and the reasonableness of, claiming the full sum of the penalty. [46] D9 pleads, in the alternative, that the penalty is not recoverable by the plaintiff because:

the encroachment was very small;

the plaintiff’s development on the Land was not impeded; and

plaintiff’s claim was disproportionate to the extent of the encroachment. ISSUES [47] The following are agreed issues to be tried in the main suit between the plaintiff and D1 to D9: Q1. Whether D1 to D8 failed to deliver vacant possession of the Land to the plaintiff in the manner stipulated in the SPA on or before 23.02.2018? Q2. If Q1 is answered in the positive, whether D1 to D8 had breached the terms of the SPA and is responsible to pay late delivery charges of vacant possession at RM2,209.50 from 24.02.2018 until the last encroachment by Lot 224 was eliminated? Q3. If Q1 is answered in the positive, whether the D9 breached her stakeholder duty by releasing the Balance of the Purchase Price before vacant possession of Lot 2355 was delivered to the plaintiff? S/N rCSxt2pjHEmmvSmm7iBsng Q3A. If the answer to Q3 is positive, did the breach by D9 cause the plaintiff to suffer any loss and the amount of loss, if any? Q4. Whether the plaintiff is entitled to the reliefs claimed against the defendants? Q5. Whether the plaintiff had waived his rights and/or is estopped from claiming from the D1 to D9? Q6. Whether at all material times, the plaintiff knew about the encroachment on Lot 2355? Q7. Whether the plaintiff will be unjustly enriched? Q1. Whether D1 to D8 failed to deliver vacant possession of the Land to the plaintiff in the manner stipulated in the SPA on or before 23.02.2018? [48] The primary issue in this matter is whether vacant possession of the Land was delivered by D1 to D8 to the plaintiff within five working days from 14 February 2018, being the date on which the balance of the purchase price was deposited with D9, acting as the vendors’ solicitor. Furthermore, it must be determined whether, due to the encroachment onto the Land by eight neighbouring lots, D1 to D8 failed to hand over vacant possession of the Land in accordance with clause 10(a) of the [49] Delivery of vacant possession is governed by clause 10(a) of the SPA. The Vendors are obliged under clause 10(a) of the SPA to deliver vacant possession of the Land to the plaintiff within 5 working days from the date the balance purchase price is deposited with D9 (“delivery date”), “free of all squatter(s), occupant(s), licensee(s) and/or tenant(s) S/N rCSxt2pjHEmmvSmm7iBsng save and except for the oil palm trees” in the same state and condition as inspected by the plaintiff as at the date of the SPA. [50] If the Vendors fail to deliver the Land on the delivery date, under clause 10(b) of the SPA, they are to pay interest to the plaintiff at the rate of 8% per annum on the purchase price. Clauses 10(a) and 10(b) of the SPA reads:

The Vendor shall deliver vacant possession of the said Land free of all squatter(s), occupant(s), licensee(s) and/or tenant(s) save and except for the oil palm trees to the Purchaser or Purchaser’s Solicitors within five (5) working days from the date of the Balance of Purchase Price and Late Payment Interest, if any is deposited with the Vendor’s Solicitors herein in the same state and conditions as inspected by the Purchaser as at the date hereof (hereinafter referred to as a “the Delivery Date”).

Where the vacant possession of the said Land is delivered after the Delivery Date, the Vendor agrees to pay interest thereon at the rate of eight (8%) per centum per annum on the Purchase Price. In any event, the Vendor’s Solicitors are authorized to deduct such amounts as necessary for the penalty for later delivery of vacant possession from the Balance of the Purchase Price and refund the said amount to the Purchaser or the Purchaser’s Solicitors. [Emphasis added] How large was the encroachment on the Land? [51] The Land is rectangular in shape with an area of 871,198.62 square feet (equivalent to 80,937 sq. meters). It measured approximately 2,296 feet (equivalent to 700 meters) in length and 374 feet (equivalent to 114 meters) in width. [52] The encroachment on the Land was the short wall and/or chain link fence of the eight neighbouring lots. The short wall and/or chain link fence was located at the boundary of the said neighbouring lots with the Land S/N rCSxt2pjHEmmvSmm7iBsng — at the rear of the lots and the rear of the Land. It was at the very edges of the Land. [53] The encroachment of the Land was along its boundary of 2,296 feet. The widest encroachment of the Land measured approximately 10 inches (25.5 cm) and the narrowest encroachment was 1.7 inches (4.3 cm). The total encroachment measured 641.5 sq. ft (59.6 sq. meters), which is 0.0736 % (59.6 sqm / 80,937 sqm X 100 = 0.0736%) of the total area of the Land. The encroachment is less than 0.1 % of the total area of the Land. The image of the Land and the encroachment extracted from the survey plan (in Bundle B6/p. 372) is produced below. The area of Land is marked in red and the encroachment is highlighted in yellow (not to scale). S/N rCSxt2pjHEmmvSmm7iBsng [54] The plaintiff’s case is that the D1 to D8 did not deliver vacant possession within 5 working days from the date of the balance of the purchase price was deposited with D9 because the encroachment by the eight neighbouring lots had caused D1 to D8 to fail to deliver the said Land “free of all squatter(s), occupant(s), licensee(s) and/or tenant(s)” on or before 23.02.2018. [55] It is trite that the interpretation of a contract is a question of law to be determined by the Courts. In construing a contract, Courts must adopt an objective approach and interpret the words in their natural and ordinary meaning. [56] The question for this Court’s determination is whether an encroachment of 0.07% of the Land by the low wall and/or chain link fence of the neighbouring lots at the border of the Land rendered the delivery of vacant possession of the Land not free of squatters, occupants, licensee and/or tenants. De Minimis Rule [57] This Court is entitled to apply the de minimis rule in determining whether encroachment by the short wall and/or the chain link fence of the eight neighbouring lots amounted to an occupation of the Land “by squatters, occupants, licensees and/or tenants”. [58] In the Singapore case of Fima Construction Pte Ltd v Neo & Neo Brother Pte Ltd [1991] CLJU 70, there was an encroachment on the plaintiff’s land consisting of an area of wall of 0.24 sq. meters and area of hoarding equal to 0.2 sq. meters. Chang Sek Keong J (later CJ of Singapore) refused the plaintiff’s claim for an injunction. His Lordship’s reasons for refusing the injunction were (i) the smallness of the S/N rCSxt2pjHEmmvSmm7iBsng encroachment, which was an area of about 3 sq. feet distributed over the whole length of the boundary of about 82 feet (equivalent to 25 meters); and (ii) the encroachment was trapped in between two walls that were functionally useless to both owners. [59] In Toh Yu Huat v Chee Sze Hsien @ Chee Ah Kow [2014] 1 LNS 1015, the Shah Alam High Court found that the two columns erected by the defendant did encroach into the plaintiff’s land. However, it held that, applying the de minimis rule, the two columns were not substantial enough to be regards as a “trespassory intrusion”. [60] In this instant case, the encroachment caused by the short wall and/or chain link fence of the neighbouring lots ranged from 1.7 inches to 10 inches and was distributed along the length of the Land measuring 2,296 feet (equivalent to 700 meters) and a land area measuring 858,704 square feet (equivalent to 80,937 sq. meters) is extremely small. It is 0.07% of the total Land area, which is miniscule. [61] Accordingly, this Court applying the de minimis rule finds that the encroachment of 0.07% of the Land by the short wall and/or chain link fence of the eight neighbouring lots does not amount to occupation of the Land by squatters, occupants, licensees and/or tenants. Findings on Q1 [62] For this reason, this Court finds that D1 to D8 had delivered vacant possession of the Land to the plaintiff on or before 23.02.2018 in accordance with the manner stipulated in clause 10(a) of the SPA, namely free of squatters, occupants, licensees and/or tenants. [63] Therefore, Q1 of the agreed issues to be tried is answered in the negative. S/N rCSxt2pjHEmmvSmm7iBsng Q2, Q3 and Q3A [64] As Q1 is answered in the negative, it is not necessary for this Court to answer Q2, Q3 and Q3A of the agreed issues to be tried. Q4: Whether the plaintiff is entitled to the reliefs claimed against the defendants? [65] This Court has made a finding of fact that D1 to D8 had delivered vacant possession of the Land to the plaintiff on or before 23.02.2018 in accordance with the manner stipulated in clause 10(a) of the SPA. [66] Accordingly, this Court finds that the plaintiff is not entitled to the reliefs claimed in statement of claim against the defendant. Q5. Whether the plaintiff had waived its rights and/or is estopped from claiming from D1 to D8 and D9? [67] What amounts to waiver? According to Lord Chelmsford LC in The Earl of Darnley v. The Proprietors, & C Of The London, Chatham, and Dover Railway [1867] LR 2 HL 43, at p. 57: A waiver must be an intentional act with knowledge. [68] The Court of Appeal in Abd Razak Atan v Dato’ Ahmad Ragib Mohd Salleh & Ors [2010] 6 CLJ 887 cited with approval The Earl of Darnley case. Abdul Malik Ishak JCA said: [62] For a waiver to arise, there must, firstly, be "some distinct act ought to be done, to constitute a waiver" (per Parke B in Doe D Nash v. Birch ER 150 Exch. 1 M & W 402, 406). Secondly, it must be "intentional" in the sense that it is intended to treat the matter as if the condition did not exist or as if the forfeiture or breach of condition had not occurred (per Isaacs J in Craine v. The Colonial Mutual Fire Insurance Company Limited And Another [1920] S/N rCSxt2pjHEmmvSmm7iBsng 20 28 CLR 305, at p. 326). Lastly, what is being done must be done with "knowledge" (Matthews v. Smallwood [1910] 1 Ch 777). [69] The Court of Appeal in Abd Razak Atan also cited with approval the Lord Denning MR’s dicta in the English Court of Appeal case of Bremer Handelsgesellschaft MBH v. C Mackprang Jr [1979] 1 Lloyd's Law Reports 221 at p. 226, where he said: I regard the decision of the House in Bremer v. Vanden [1978] 2 Lloyd's Rep 109 as a most important decision on waiver. As Mr. Davenport said, it is the final step in the series of Central London Property Trust Ltd. v. High Trees House [1947] KB 130; Rickards v. Oppenheim [1950] 1 KB 616; Panchaud Freres SA v. Etablissements General Grain Co [1970] 1 Lloyd's Rep. 53; and WJ Alan & Co v. El Nasr Export & Import Co. Ltd. [1972] 1 Lloyd's Rep. 313; [1972] 2 Q.B. 189. [70] In Bremer Handelsgesellschaft MBH v. C Mackprang Jr, Lord Denning relied on his own judgment in WJ Alan & Co Ltd v. El Nasr Export And Import Co [1972] 1 Lloyd's Law Reports 313, at p. 323, CA, where he explained the principle of waiver as follows: ... If one party, by his conduct, leads another to believe that the strict rights arising under the contract will not be insisted upon, intending that the other should act on that belief, and he does act on it, then the first party will not afterwards be allowed to insist on the strict legal rights when it would be inequitable for him to do so... [71] Therefore, in deciding whether the plaintiff had waived its rights and/or is estopped from claiming from D1 to D8 and D9 as regards the non-delivery of vacant possession by reason of the encroachment, this Court must decide: first, whether there was an act with knowledge by the plaintiff; second, whether the act was intentional in the sense that it is intended to treat the matter as if the condition did not exist or as if the breach of condition had not occurred S/N rCSxt2pjHEmmvSmm7iBsng [72] The encroachment onto the Land by the eight neighbouring lots was shown on of the 1st survey plan, commissioned by the plaintiff prior to entering into the SPA with D1 to D8. However, the plaintiff claims that it did not see the encroachment on the of the 1st survey plan because the encroachment was too small. [73] The plaintiff’s case is that it only noticed the encroachment after it went into the Land a few days after 26.02.2018; which was the date of STMNs’ letter to D9 confirming that vacant possession of the Land was deemed delivered to the plaintiff in accordance with clause 10 of the SPA, and the date of D9’s reply to STMN informing it of the apportionment of the quit rent for the Land and that the Land was deemed delivered to the plaintiff on 15.02.2018. [74] The plaintiff did not dispute D9’s calculation regarding the apportionment of the quit rent. Furthermore, quit rent only be apportioned from the date vacant possession was handed over to the plaintiff. [75] PW1 testified that the plaintiff noticed the encroachment when it went into the Land a few days after 26.02.2018. Nevertheless, despite the discovery of the encroachment, the plaintiff continued to clear the Land of the oil palm trees and proceeded to develop and build the factories on the Land. The factories built by the plaintiff on the Land were all purchased by

This shows that the de minimis encroachment did not hinder the development of the Land or the sale of the factories built on the Land by the plaintiff. [76] Learned counsel for D1 to D8, and D9, submits that if the plaintiff’s contention was true i.e. that vacant possession had not been delivered, the plaintiff would not have been able to deal with the Land by clearing and developing the Land — as the plaintiff would be trespassing onto D1 S/N rCSxt2pjHEmmvSmm7iBsng to D8’s Land when it was clearing the oil palm trees from the Land and developing the Land. [77] PW2, the STMN lawyer who had acted for the plaintiff in the SPA, agreed under cross-examination by D9’s counsel that even though the plaintiff’s position is that vacant possession had not been delivered, the plaintiff had actually taken physical possession of the Land, built on the Land and sold it on to the third-party purchasers of the factories built on the Land. Findings on Q5 [78] Based on the facts and circumstances of this case, I find that the plaintiff had acted with knowledge of the encroachment when it intentionally cleared the oil palm trees, applied for the necessary approvals for development of the Land, developed and constructed the buildings on the Land, and sold all the buildings developed on the Land, whilst the encroachment was still present on the Land and before it had reached settlement with the neighbouring lots on the encroachment. [79] For this reason, I find that the plaintiff by its actions had waived its rights under the SPA as to the encroachment and is estopped from claiming non-delivery of vacant possession against D1 to D8, and D9. Q6. Whether at all material times, the plaintiff knew about the encroachment on the Land? [80] The evidence shows that the 1st survey plan commissioned by the plaintiff prior to the entering into the SPA, showed the encroachment by the neighbouring lots along the length of the Land bordering the neighbouring lots. The fact that neither PW1 nor the plaintiff noticed the S/N rCSxt2pjHEmmvSmm7iBsng encroachment on the 1st survey plan, until after the Land was registered and it had taken delivery of the Land, does not mean that it did not have knowledge of the encroachment prior to entering into the SPA. [81] Furthermore, by the plaintiff’s own evidence, it knew of the encroachment when it went into the Land a few days after 26.02.2018 to take physical possession of the Land and proceed with its land clearing and development of the Land, and selling the buildings it has developed on the Land. Findings on Q6 [82] Accordingly, I find that the plaintiff at all material times knew about the encroachment of the Land. Q7. Will the plaintiff be unjustly enriched? [83] Under clause 11(a) of the SPA, the parties agreed that the land is sold in its present state and conditions and “free of all squatter(s), occupant(s), licensee(s) and/or tenant(s) save and except for the oil palm trees”. Clause 11(a) of the SPA reads:

The said Land is sold in its present state and conditions and free of all squatter(s), occupant(s), settler(s), licensee(s) and/or tenant(s) save and except for the oil palm trees and the Purchaser shall be deemed to have inspected the said Land and have satisfied himself by examination and inspection as to the said Land in every respect and the Purchaser shall be deemed to have full knowledge of the nature and effect thereof and the Purchaser shall be to have purchased the Land in its present state and condition upon a “as is where is” basis free of all squatter(s), occupant(s), licensee(s) and/or tenant(s) save and except for the oil palm trees, and not upon or pursuant to any representation, statement, warranty or condition whatsoever made to S/N rCSxt2pjHEmmvSmm7iBsng the Purchaser and the Purchaser shall not be entitled to rescind the purchase or to claim compensation or damages nor any reduction in the Purchase Price in respect of the conditions, measurement area and state of the said Land. [Emphasis added] [84] Under clause 11(a) of the SPA, the plaintiff:

shall be deemed to have inspected the land and have satisfied himself by examination and inspection of the land in every respect;

shall be deemed to have full knowledge of the nature and effect thereof;

shall be deemed to have purchased the Land in its present state and condition upon a “as is where is” basis free of all squatter(s), occupant(s), licensee(s) and/or tenant(s) save and except for the oil palm trees, and not upon or pursuant to any representation, statement, warranty or condition whatsoever made to the plaintiff; and

the plaintiff shall not be entitled to rescind the purchase or to claim compensation or damages nor any reduction in the Purchase Price in respect of the conditions, measurement area and state of the said Land. [85] By virtue of clause 11(a) of the SPA, the plaintiff shall not be entitled to rescind the purchase or to claim compensation or damages nor any reduction in the Purchase Price in respect of the conditions, measurement area and state of the said Land. [86] Nonetheless, in this action, the plaintiff is seeking to obtain compensation through clause 10(b) of the SPA by claiming that vacant S/N rCSxt2pjHEmmvSmm7iBsng possession of the Land had not been delivered within five working days from the date of payment of the balance of the purchase price because of the encroachment of the Land by the neighbouring lots. [87] This Court, for reasons discussed above, has found that the plaintiff

knew about the encroachment from the 1st survey plan before the signing the SPA with D1 to D8; and (b) had at all material times conducted itself consistently with taking possession of the Land to the detriment of D1 to D8, and had proceeded to clear and develop the Land. [88] The plaintiff through their inaction and/or failure to cooperate with the defendants also allowed interests, for the delay in removing the encroachment, to compound. This can be seen from the fact despite D1’s requests for document relating to the encroachment, the plaintiff’s solicitors, STMN, refused to provide the documents and instead insisted that D1 to D8 obtain the documents themselves. Screenshots of the correspondence between D9 and STMN are produced below:

Letter from D9 to STMN dated 07.06.2018 S/N rCSxt2pjHEmmvSmm7iBsng

Letter from D9 to STMN dated 07.09.2018

Reply from STMN to D9 dated 07.06.2018 S/N rCSxt2pjHEmmvSmm7iBsng [89] The plaintiff had also settled the issue of encroachment with the owners of the neighbouring lots. In the reliefs prayed for in its writ, the plaintiff, among others, is seeking from the defendants late delivery interest of RM2,209.50 per day from 08.08.2019 until the date when the encroachment by Lot 224 is removed. [90] Lot 224 is the neighbouring lot owned by the Pesuruhjaya Tanah Persekutuan. The facts show that the Pesuruhjaya Tanah Persekutuan had settled the case and had paid the plaintiff the sum of RM18,087.00 as cost to remove the encroachment. However, the report produced by Tuan Ganesan Karruppiah, Ketua Penolong Pengarah, Jabatan Ketua Pengarah Tanah dan Galian Persekutuan (“DW3”), confirmed that as 10.11.2022, the plaintiff still had not removed encroachment. [91] The plaintiff claimed that the removal of the encroachment would have to be resolved in order for it to obtain the certificate of completion and compliance (“CCC”). However, the evidence shows that the plaintiff had obtained the CCC on 24.02.2022, even though DW3’s report shows that the encroachment had not been removed as at 10.11.2022. Therefore, there is no truth to PW1’s claim that the encroachment by Lot 224 had prevented it from obtaining the CCC for the buildings constructed on the Land. [92] Furthermore, the plaintiff settled the issue of the encroachment with Xun Hong Hardware Sdn Bhd (the 1st Third Party in the third party suit) who is the owner of Lot 222, in or around April 2019, as is evident from the Notice of Discontinuance filed the plaintiff in Civil Suit No. BA- 23NCVC-14-03/2019 dated 09.04.2019, discontinuing its action against Xun Hong Hardware Sdn Bhd. However, the plaintiff did not do anything to remove the encroachment until about 02.06.2020. The excerpt of S/N rCSxt2pjHEmmvSmm7iBsng PW1’s testimony during cross-examination by D9’s counsel is produced below: Encl. 355, NOP Jilid 1, p. 118, lines 1-8 Wong: So it’s not urgent is it? You can sit do nothing after April 2019 for more than a year how urgent can it be. It’s not urgent isn’t it? Pung: Okay yes Wong: In other words on top of that you also just now that you did not even follow up with the contractor, correct? Pung Yes Law on Unjust Enrichment [93] The Federal Court in Dream Property Sdn Bhd v Atlas Housing Sdn Bhd [2015] 2 MLJ 441 expressly recognised the principle of unjust enrichment under Malaysian law, where it adopted the civilian systems of “absence of basis” approach as oppose to the English law “unjust factors” approach. Azahar Mohamed FCJ (as he then was) delivering the judgment of the Federal Court explained the difference of approach between the law of unjust enrichment under English law and that under Civilian systems as follows: [128] The most important question which we must now ask is whether it is unjust for the plaintiff to retain to the benefit (the unjust question). The English approach to the unjust question is to ascertain an unjust factor such as, for example, mistake or failure of consideration. This differs with the civilian approach to the unjust question which consider whether there is a lack of juristic basis. [129] We would adopt 'the absence of basis' ……… approach of the civilian and mixed law systems for the reason that, in our view, it would produce a fairer outcome. S/N rCSxt2pjHEmmvSmm7iBsng [94] In Dream Property, the Federal Court held that the defendant had made out a cause of action of unjust enrichment. Per Azahar Mohamed FCJ (as he then was): “[130] On the factual matrix of the present case, in our judgment, injustice has occurred to such an extent that the defendant has not only suffered a loss, but the plaintiff is at the same time made richer by the defendant's loss by the same amount. On that note, the point to make here is this. This sense of injustice at the defendant's expense is central to the foundation of the relief of restitution based on the law of unjust enrichment. The plaintiff should not be allowed to reap the windfall at the expense of the defendant. The defendant lawfully constructed the mall on the land not intending to do so gratuitously with the plaintiff enjoying its benefit. On this basis, it warrants judicial intervention as a legal response triggered by an unjust enrichment in the fact situation of the present case. [131] To conclude, we hold that the defendant had made out a cause of action in unjust enrichment in that the plaintiff has been enriched, that this enrichment was gained at the defendant's expense, and that the plaintiff's enrichment was unjust. [Emphasis added] [95] On the remedy to be awarded to the defendant in that case, the Federal Court referred to Goff & Jones on The Law of Unjust Enrichment, where the authors at para. 36-02 quoting Lord Hope’s dicta in Sempra Metals Ltd v IRC [2008] 1 A.C. 561 stated that In every case where a defendant is unjustly enriched at a claimant’s expense, English law gives the claimant a right to restitution from the defendant. The courts sometimes use the word ‘restitution’ to describe a measure of compensation for civil wrongdoing, and when it is used in this sense the word means ‘restoring the claimant to the position he occupied before he was caused a loss by the defendant’s wrong’. In this context, however, the word ‘restitution’ means something different, namely ‘restoring the value received by the defendant to the claimant’. There is an obvious danger of confusion here, and these two meanings of the word must be kept separate. As Lord Hope said in Sempra Metals Ltd v IRC, ‘the law of restitution is the law of gain-based recovery, just as the S/N rCSxt2pjHEmmvSmm7iBsng law of compensation is the law of loss-based recovery’ and ‘the remedy of restitution differs from that of damages. It is the gain that needs to be measured, not the loss to the claimant. The gain needs to be reversed if the claimant is to make good his remedy ‘The law of restitution is the law of gain-based recovery, just as the law of compensation is the law of loss-based recovery’ and ‘the remedy of restitution differs from that of damages’. It is the gain that needs to be measured, not the loss to the claimant. The gain needs to be reversed if the claimant is to make good his remedy. [Emphasis added] [96] Applying the “absence of basis” principle adopted in Dream Property, I find that there is an absence of basis for the plaintiff to be awarded the gain-based recovery of interest in the sum of RM1,171,035.00 (RM2,209.50 x 530 days) for the period from 24.02.2018 to 07.08.2019 sought by the plaintiffs. [97] This is because, for the reasons discussed above, this Court has found that applying the de minimis rule the encroachment on 0.07% of the Land, did not amount to an occupation of the Land by squatters, occupants, licensees and/or tenants”. [98] Moreover, the encroachment was present on the Land as at the date the plaintiff had inspected the Land prior to date of Mr Gan’s offer to purchase the Land and was shown on the 1st survey plan commissioned by the plaintiff prior to entering into the SPA. Accordingly, the Land was in the same state and condition as inspected by the plaintiff prior to the SPA and as at the date of the SPA. [99] As D1 to D8 had delivered vacant possession of the Land in accordance with clause 10(a) of the SPA within 5 working days from the date the balance purchase price was deposited with D9, free of all squatter(s), occupant(s), licensee(s) and/or tenant(s) save and except for the oil palm trees in the same state and condition as inspected by the S/N rCSxt2pjHEmmvSmm7iBsng plaintiff as at the date of the SPA, there is an absence of basis as to why the plaintiff should be granted the daily interest of RM2,209.50 for 530 days sought for. [100] Additionally, the plaintiff by its conduct had taken physical possession of the Land after 26.02.2018, had developed the Land and had sold all buildings that it had constructed on the Land. Clearly, the “encroachment” by the eight neighbouring lots did not in any way impair the plaintiff’s ability to develop the Land and to sell the buildings that it had constructed on it. [101] Similarly, I find there is an absence of basis for the plaintiff to make a gain-based recovery for late delivery interest of RM2,209.50 per day until date the encroachment and occupation of the Land caused by Lot 224 has ceased. As the DW3’s report shows, although the plaintiff had received from Pesuruhjaya Tanah Persekutuan the sum of RM18,087.00 as cost to remove the encroachment, the plaintiff has not as of 10.11.2022 removed the encroachment. Findings on Q7 [102] Therefore, for these reasons, I find that the defendants have proven that the plaintiff will be unjustly enriched if this Court is to award the reliefs sought by the plaintiff. To echo the words of the Federal Court in Dream Property, the plaintiff cannot be allowed to reap a windfall at the expense of the defendants. Decision [103] Accordingly, for the reasons above, the plaintiff’s claim against the D1 to D9 is dismissed with costs. S/N rCSxt2pjHEmmvSmm7iBsng [104] Costs of RM30,000.00 to be paid by the plaintiff to D1 to D8, subject to the allocatur fee. [105] Costs of RM20,000.00 to be paid by the plaintiff to D1, subject to the allocatur fee. [106] D1 to D8’s action against the third parties and the 1st, 2nd, 5th and 6th third parties’ actions against the fourth parties are adjourned sine die. Dated: 22 September 2025 -sgd- (FAIZAH JAMALUDIN) JUDGE HIGH COURT OF MALAYA AT SHAH ALAM S/N rCSxt2pjHEmmvSmm7iBsng COUNSELS: For the Plaintiffs: Richard Kok Chi Wei Ho Yi Hun [Messrs Richard Kok] For the 1st to 8th Defendants: Ravichandran a/l Supramaniam Elaina Teng Xue Er [Messrs Seah Balan Ravi & Co] For the 9th Defendant: Wong Hok Mun Koh Pei Siah [Messrs Wong Hok Mun Partnership] S/N rCSxt2pjHEmmvSmm7iBsng