Rich Prudence Sdn Bhd v Cenviro Recycling & Recovery Sdn Bhd (WA-22NCC-429-08/2022)

This case concerns a dispute between the Plaintiff, Rich Prudence Sdn Bhd (“RPSB”), and the Defendant, Cenviro Recycling & Recovery Sdn Bhd (“CRR”), arising out of a “Terms for Purchase of Transformer Agreement” dated 13.6.2018 (“Agreement”). The Plaintiff claims for outstanding variance payments and damages for misrepresentation. The Defendant denies the claims and counterclaims for unaccounted copper. S/N ag71q2bjR02XHoDLCQdthw

The Plaintiff asserts that the Defendant made pre-contractual representations that: i) The Plaintiff would be appointed for 10 years, in 2-year tranches, subject to the Defendant’s ongoing contract with TNB; ii) the appointment would be exclusive; and iii) the contract would be renewed if performance was satisfactory. The Plaintiff relies on these representations and the subsequent three extensions to claim that the contract, or alternatively a collateral agreement, was wrongfully not renewed after 31.1.2022.

I find that the express terms of the Agreement govern the relationship between the parties. The Agreement clearly stipulates a two-year contract period, with any renewal being subject to the Defendant’s discretion based on satisfactory performance. It also contains an Entire Agreement Clause, which expressly excludes all prior agreements and quotations. Although the said clause does not expressly refer to “representations”, in my view, the clause includes such representations, even though they are not expressly mentioned.

The Plaintiff contends that the representations formed part of a collateral contract or induced the Plaintiff to enter the main S/N ag71q2bjR02XHoDLCQdthw Page 3 of 8 contract, invoking Sections 92(a) and 92(b) of the Evidence Act 1950. However, I find that the evidence falls short of establishing a binding collateral contract. There is no clear, consistent, and unequivocal evidence that the Defendant unequivocally promised the Plaintiff a 10-year tenure or exclusivity.

Further, the Plaintiff has not shown that the representations were incorporated into the contract or that it was misled to its detriment. The draft Agreement was reviewed with legal input, and the Plaintiff executed it without reservation. The Agreement is also a Part A document, which reinforces that its content is accepted and agreed.

As for the variance claims amounting to RM9.54 million, the Plaintiff asserts that it is entitled to recover overpayments due to discrepancies in the component weights. However, I find that Clause 9(C) of the Agreement prescribes that discrepancies must be notified “immediately” upon dismantling, which must occur within 14 days. The evidence, including admissions by PW1, shows that key claims, including those for 2019, were not raised in compliance with this timeline. The Agreement further stipulates that the final actual weight is conclusive. Therefore, the Plaintiff cannot rely on the alleged discrepancies to mount its claims.

The Plaintiff relies heavily, if not entirely, on the letter dated 6.4.2022 and other “without prejudice” correspondence to S/N ag71q2bjR02XHoDLCQdthw Page 4 of 8 support its 2020 and 2021 variance claims. However, these communications are clearly privileged under Section 23 of the Evidence Act 1950 and are inadmissible unless they result in a concluded settlement.

The cases on this point are settled. In Malayan Banking Bhd v Foo See Moi [1981] 2 MLJ 17, the Federal Court held that “without prejudice” communications are inadmissible as evidence unless they result in an agreement. In Hadi bin Hassan v Suria Records Sdn Bhd & Ors [2005] 3 MLJ 522, the High Court further held that this principle “extends to all the subsequent parts of the same correspondence on both sides even though they are not expressed to be ‘without prejudice’”. The Plaintiff has not shown that the letter of 6.4.2022 or any subsequent correspondence led to a concluded settlement.

The Plaintiff seeks to rely on De Tebrau Makmur Sdn Bhd & Anor v. Bank Kerjasama Rakyat Malaysia Bhd [2017] MLJU 201 to admit the 6.4.2022 letter as a Part B document. However, that case is distinguishable. The fact that a document is marked Part B does not override the substantive common law and statutory protection of without prejudice communications. The Plaintiff’s reliance on this ground is misconceived.

Even if admissible, the letter of 6.4.2022 did not contain any clear or unequivocal admission of liability by the Defendant. It was a settlement proposal which the Plaintiff ultimately S/N ag71q2bjR02XHoDLCQdthw Page 5 of 8 rejected. Similarly, there was no acceptance of any subsequent proposal, and thus no binding agreement resulted.

As for the 2019 “Agreed VC Document”, I find that it does not contain any unequivocal admission of liability by the Defendant. The document summarises disputed figures and timelines, and the Plaintiff itself amended its claim during trial upon challenge. In any event, the same contractual limitations under Clause 9(C) apply.

On the counterclaim, the Defendant alleges that the Plaintiff failed to account for copper worth RM8.74 million. I find that the Defendant has not proven on a balance of probabilities that the alleged shortfall is attributable to wrongful retention or conversion by the Plaintiff.

Having considered the totality of the evidence, I am not satisfied that the Plaintiff has established its claim for misrepresentation, breach of contract, collateral agreement, or restitution under Section 71 of the Contracts Act 1950. The variance claims fail for non-compliance with the contractual mechanism. The Defendant’s counterclaim is also not made out.

I note that while the Plaintiff initially disputed the variance amounts stated in the Defendant’s letter dated 6.4.2022, it now accepts the figures for the years 2020 and 2021 as forming the basis of its present claim. The Plaintiff relies on S/N ag71q2bjR02XHoDLCQdthw Page 6 of 8 these as agreed amounts allegedly confirmed through correspondence. However, it maintains that the Defendant remains liable for the 2019 variance claims, which the Defendant denies on grounds of non-compliance with the contractual notice procedure. This selective reliance on the 6.4.2022 letter underscores the Plaintiff’s inconsistent approach and further weakens its argument that the letter constitutes a binding admission by the Defendant.

For the reasons set out above, I dismissed the Plaintiff’s claim as well as the Defendant’s counterclaim. In view of the fact that neither party has succeeded in their respective claims, I make no order as to costs. Dated this 17th day of October, 2025 -SGD- (WAN MUHAMMAD AMIN BIN WAN YAHYA) JUDGE HIGH COURT OF MALAYA, (COMMERCIAL DIVISION (NCC 3)) HIGH COURT OF KUALA LUMPUR IN THE FEDERAL TERRITORY, MALAYSIA S/N ag71q2bjR02XHoDLCQdthw Page 7 of 8 COUNSEL FOR THE PLAINTIFF : Shaarvin Raaj A/L Selva Kumar (Ravvenneah A/P Kalisvaran together with him) Messrs Kumar Partnership Suite 12.01-12.02, 12th Floor, Wisma E & C, No. 2, Lorong Dungun Kiri, Damansara Heights, 50490 Kuala Lumpur Tel: 03-20933131 Email: kp@kpartnership.com.my COUNSEL FOR THE DEFENDANT : Brian Foong Mun Loong (Muhammad Hiqmar Danial bin Hidzir and Derek Kho Ngiat Liang together with him) Messrs Cheang & Ariff Loke Mansion, 273A, Jalan Medan Tuanku, 50300 Kuala Lumpur Tel: 03-26910803 Email: ca@cheangariff.com LEGISLATION / RULES CITED Evidence Act 1950 ▪ Section 23 ▪ Sections 92(a) and 92(b) Contracts Act 1950 ▪ Section 71 S/N ag71q2bjR02XHoDLCQdthw Page 8 of 8

De Tebrau Makmur Sdn Bhd & Anor v. Bank Kerjasama Rakyat

Hadi bin Hassan v. Suria Records Sdn Bhd & Ors [2005] 3 MLJ 522

Malayan Banking Bhd v. Foo See Moi [1981] 2 MLJ 17 S/N ag71q2bjR02XHoDLCQdthw