CONVOBUILT SDN. BHD KPTC RESORT DEVELOPMENT BERHAD

CONVOBUILT SDN. BHD KPTC RESORT DEVELOPMENT BERHAD

On a commercial construction of the Settlement Agreement, the 24 Redemption Units were assigned solely for the purpose of enabling the defendant to redeem charged properties; the defendant never paid the redemption sum and the charge was later discharged, rendering the purpose impossible; equity requires imposition of a constructive trust so that beneficial interest in the Redemption Units revests in the plaintiff; the background letter (ID-1) was admissible and supported this construction; the defendant's third-party Kemas Budi arrangement did not absolve it as there was no privity and no evidence of consideration.

Citation
B-02(NCVC)(W)-2023-10/2018 (Mahkamah Rayuan)
Parties
Appellant (appeal 1976); Plaintiff (high Court): KPTC Resort Development Berhad; Respondent (appeal 1976); Appellant (appeal 2023); Defendant (high Court): Convobuilt Sdn Bhd
Court
NCVC
Jurisdiction
Malaysia
Judgment Date
29 August 2019
Case Number
B-02(NCVC)(W)-2023-10/2018 (Mahkamah Rayuan)
Procedural Posture
Civil Appeal (court of Appeal) / Judgment on Appeal Following Trial and High Court Decision
Outcome
Appeal 1976 allowed; High Court order set aside; Appeal 2023 dismissed except concession regarding two properties; cross-appeal dismissed; judgment entered for the plaintiff
Legal Topics
Settlement Agreement Interpretation, Constructive Trust, Resulting Trust, Assignment of Property, Redemption of Charged Property, Unjust Enrichment, Admissibility of Background Evidence
Source Language
Malay/English
Contract Equity Trusts Property Civil Procedure Construction Law Settlement Agreement Interpretation Constructive Trust +5 more

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Parties

KPTC Resort Development Berhad

Appellant (appeal 1976); Plaintiff (high Court)

Convobuilt Sdn Bhd

Respondent (appeal 1976); Appellant (appeal 2023); Defendant (high Court)

Procedural Posture

Civil Appeal (court of Appeal) / Judgment on Appeal Following Trial and High Court Decision

Legal Issues

  1. 1 Whether the Redemption Units were assigned absolutely to the defendant or only for the specific purpose of redeeming charged properties
  2. 2 Whether a constructive trust arises in favour of the plaintiff because the defendant did not pay the redemption sum and the charge was later lifted
  3. 3 Whether the letter ID-1 and surrounding background were admissible to interpret the Settlement Agreement

Ratio Decidendi

On a commercial construction of the Settlement Agreement, the 24 Redemption Units were assigned solely for the purpose of enabling the defendant to redeem charged properties; the defendant never paid the redemption sum and the charge was later discharged, rendering the purpose impossible; equity requires imposition of a constructive trust so that beneficial interest in the Redemption Units revests in the plaintiff; the background letter (ID-1) was admissible and supported this construction; the defendant's third-party Kemas Budi arrangement did not absolve it as there was no privity and no evidence of consideration.

Court Disposition

Appeal 1976 allowed; High Court order set aside; Appeal 2023 dismissed except concession regarding two properties; cross-appeal dismissed; judgment entered for the plaintiff

Orders

  • Transfer of 23 apartment units (Redemption Units) to the plaintiff free of encumbrances
  • Defendant to reassign the Redemption Units to the plaintiff