NEXGRAM LAND SDN BHD 1. ) SPACIOUS GLORY SDN BHD 2. ) Lau Tian Kit

NEXGRAM LAND SDN BHD 1. ) SPACIOUS GLORY SDN BHD 2. ) Lau Tian Kit

The Court of Appeal found that material misrepresentations and omissions in the due diligence responses and confirmation statement induced the Appellant to enter the Share Sale Agreement, that the 2nd respondent was personally involved and liable, that the Appellant validly avoided the contract, and that specific performance was inappropriate; accordingly the appeal was allowed, the contract was rescinded, specific performance set aside, special damages of RM52,660.28 awarded and consequential orders made for return of shares and costs.

Citation
W-02(NCC)(W)-1622-08/2018 (Mahkamah Rayuan)
Parties
Appellant: Nexgram Land Sdn Bhd; 1st Respondent: Spacious Glory Sdn Bhd; 2nd Respondent: Lau Tian Kit
Court
NCC
Jurisdiction
Malaysia
Judgment Date
28 January 2022
Case Number
W-02(NCC)(W)-1622-08/2018 (Mahkamah Rayuan)
Procedural Posture
Civil Appeal From High Court / Court of Appeal Judgment on Appeal
Outcome
Appeal allowed; cross-appeals dismissed
Legal Topics
Specific Performance, Rescission, Negligent Misrepresentation, Fraudulent Misrepresentation, Due Diligence, Damages, Agency and Director Liability
Source Language
Malay/English
Contract Law Company Law Equity and Remedies Tort (negligent Misrepresentation) Specific Performance Rescission Negligent Misrepresentation Fraudulent Misrepresentation +3 more

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Parties

Nexgram Land Sdn Bhd

Appellant

Spacious Glory Sdn Bhd

1st Respondent

Lau Tian Kit

2nd Respondent

Procedural Posture

Civil Appeal From High Court / Court of Appeal Judgment on Appeal

Legal Issues

  1. 1 Whether representations in the due diligence and confirmation statement amounted to actionable misrepresentations
  2. 2 Whether the 2nd respondent was personally liable for misrepresentations
  3. 3 Whether the appellant affirmed or rescinded the Share Sale Agreement

Ratio Decidendi

The Court of Appeal found that material misrepresentations and omissions in the due diligence responses and confirmation statement induced the Appellant to enter the Share Sale Agreement, that the 2nd respondent was personally involved and liable, that the Appellant validly avoided the contract, and that specific performance was inappropriate; accordingly the appeal was allowed, the contract was rescinded, specific performance set aside, special damages of RM52,660.28 awarded and consequential orders made for return of shares and costs.

Court Disposition

Appeal allowed; cross-appeals dismissed

Orders

  • Set aside the learned Judicial Commissioner’s award of nominal damages of RM5,000
  • Awarded special damages of RM52,660.28 against the 1st and 2nd Respondents (RM15,160.28 paid to Messrs Olivia Lim & Co and RM37,500.00 stamp duty)