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Employment

LABOUR LAW – CONSTRUCTIVE CLARITY: COURT REINFORCES BOUNDARIES ON EMPLOYER CONDUCT AND EMPLOYEE RIGHTS

In the significant decision of Sudhir a/l AK Kumaren v Industrial Court of Malaysia & Anor [2025] 3 MLJ 698, the Court of Appeal clarified the scope of constructive dismissal, emphasizing employers’ obligations toward transparency and good faith in managing employment relationships. The Court decisively ruled that actions such as compulsory leave, removal of duties without clear justification, and creating ambiguity about an employee’s role amount to a fundamental breach of the employment contract. This judgment highlight the critical importance of mutual trust and communication in employment contracts, reinforcing protection against employer misconduct.

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15 November ,2025
Land Law

PROPERTY LAW – CHARGED BUT NOT IN CHARGE: COURT PROTECTS HOMEBUYERS OVER LENDERS IN LANDMARK RULING

In Champion Score Sdn Bhd v Mohd Sobri Chew bin Abdullah [2025] 3 MLJ 732, the Court of Appeal robustly affirmed that developers, having received full payment, become bare trustees without power to encumber properties. The Court decisively canceled an improperly created charge, emphasizing that financial institutions must diligently scrutinize developers’ authority under powers of attorney. This landmark decision highlight judicial commitment to protecting homebuyers, reinforcing statutory and public policy safeguards against developer misconduct.

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15 November ,2025
Administrative

PERSONAL DATA PROTECTION ACT – TOO LATE, TOO LIGHT: GENTING’S DATA PRIVACY CHALLENGE FAILS ON TIMING

In Ketua Pengarah Hasil Dalam Negeri v Genting Malaysia Bhd [2025] 2 MLJ 822, the Court of Appeal overturned a High Court ruling that had favoured Genting’s resistance to a personal data disclosure request. The appeal succeeded not on substantive privacy grounds, but because Genting’s judicial review was filed out of time and targeted what the court deemed a non-reviewable act. While the conflict between tax enforcement and personal data protection remains unresolved, the decision underscores a simple procedural truth: even strong claims can collapse if they miss the clock.

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15 November ,2025
Family Law

FAMILY LAW – COSTLY AFFAIRS: A LANDMARK DECISION ON ADULTERY, SPOUSAL MAINTENANCE, AND ASSET DIVISION IN MALAYSIA

In Hai v Pai & Anor [2025] 8 MLJ 211, the Court decisively addressed the delicate intersection of marital betrayal and financial fairness. Affirming the award of damages against a third-party “homewrecker,” the decision underscores the judiciary’s firm stance on compensating emotional and financial harm arising from adultery. Furthermore, the ruling clarifies the importance of precise documentation and the consequences of commingling inherited wealth, reinforcing that matrimonial asset division requires careful, individualized assessment to achieve true equity.

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15 November ,2025
Arbitration

ARBITRATION – SHIPPING – REPAIR GONE WRONG: CLARIFYING SHIPYARD LIABILITY IN ARBITRATION (“MARE NOVA”)

In Hai v Pai & Anor [2025] 8 MLJ 211, the Court decisively addressed the delicate intersection of marital betrayal and financial fairness. Affirming the award of damages against a third-party “homewrecker,” the decision underscores the judiciary’s firm stance on compensating emotional and financial harm arising from adultery. Furthermore, the ruling clarifies the importance of precise documentation and the consequences of commingling inherited wealth, reinforcing that matrimonial asset division requires careful, individualized assessment to achieve true equity.

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15 November ,2025
Admiralty

ADMIRALTY IN REM – NO RIGHT TO ARREST: MALAYSIAN COURT BLOCKS ABUSE OF ADMIRALTY LAW OVER U.S. SANCTIONS

In Unicious Energy Pte Ltd v The Owners of the ‘Alpine Mathilde’ [2023] MLJU 2819, the High Court set aside a vessel arrest brought solely to secure arbitration claims, holding it was an abuse of admiralty jurisdiction. The Plaintiff, an OFAC-designated SDN, had no valid claim due to U.S. sanctions, and the Court ruled that arrest for arbitration must strictly comply with section 11(1)(c) of the Arbitration Act 2005. This case reinforces the limits of in rem jurisdiction and the enforceability of sanctions clauses in cross-border charterparty disputes.

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15 November ,2025
Company Law

BREACH OF FIDUCIARY DUTY – UK SUPREME COURT SHUTS DOWN ‘WHAT IF’ DEFENCE IN FIDUCIARY BREACH: NO PROFIT MEANS NO EXCUSE

In Rukhadze & Ors v Recovery Partners GP Ltd and Anor [2025] 1 Lloyd’s Rep 329, the UK Supreme Court reaffirmed the uncompromising “no profit” rule for fiduciaries. The Court held that a fiduciary who profits from their position must account for those gains – regardless of good faith, intent, or hypothetical outcomes. The appellants’ argument that they would have earned the profit even without a breach was firmly rejected. The decision emphasises that loyalty, not speculation, is the standard, and reaffirms equity’s strict stance on conflicts of interest.

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15 November ,2025
Employment

EMPLOYMENT – CONSTRUCTIVE DISMISSAL VIA TRANSFER: WHEN MANAGEMENT PREROGATIVE CROSSES THE LINE

In Saharunzaman bin Barun v Perodua Sales Sdn Bhd & Anor [2025] 2 MLJ 17, the Court of Appeal reinstated the Industrial Court’s decision that three long-serving employees were constructively dismissed after being ordered to report for duty at distant branches within three days, following their refusal to resign and accept a fixed-term contract with an associated company. The Court found that Perodua’s actions were unreasonable, mala fide, and amounted to a fundamental breach of the employment contract, especially as no valid work permits were arranged for postings in Sabah and Sarawak. The ruling affirms that “reasonableness” clauses in transfer provisions carry enforceable weight and cannot be used as tools for disguised terminations.

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15 November ,2025
Tort

MEDICAL NEGLIGENCE – WHEN SILENCE HURTS: COURT SLAMS GOVERNMENT WITH RM2M+ IN AMPUTATION NEGLIGENCE SUIT

In L/Kpl Naraayanan Nair a/l Subramaniam v Kerajaan Malaysia & Ors [2025] 8 MLJ 503, the High Court delivered a landmark ruling in a medical negligence suit involving a young police corporal who lost his arm due to delayed and negligent treatment. Citing emotional trauma, denial of timely access to medical records, and ongoing life-altering consequences, the court awarded over RM2 million in damages – including RM200,000 in aggravated damages – this shows the judiciary’s increasing emphasis on dignity, transparency, and rehabilitative justice in personal injury claims.

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15 November ,2025
Updates

TORT OF DEFAMATION – NO MALICE, NO DEFAMATION: POLITICAL COMMENTARY STANDS PROTECTED

In Lim Guan Eng v Datuk Tan Teik Cheng & Anor [2025] 2 MLJ 791, the Court of Appeal dismissed a defamation claim over a politically charged article alleging conditions tied to a RM4 million school allocation. The Court ruled that the statements – framed as a call for explanation – were not defamatory when read in full context. The defendants successfully relied on the defences of fair comment and reportage, with the Court emphasising that political commentary, if rooted in fact and honestly held, remains protected speech – even during an election campaign. Malice was not proven, and the article’s publication in a neutral “Letters to the Editor” section further insulated the publisher from liability.

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15 November ,2025

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Recent Legal Updates

CIVIL PROCEDURE – STRIKE OUT UNDER ORDER 18 RULE 19(1)(A),(B) RULES OF COURT 2012 – EXTENSION OF TIME APPLICATION

16 November ,2025

In Badan Pengurusan Subang Parkhomes v Zen Estates Sdn Bhd [2025] MLJU 3591, the High Court reaffirmed that non-compliance with Order 37 Rule 1(5) of the Rules of Court 2012 does not automatically invalidate assessment of damages proceedings. The Court held that procedural rules must be read with the overriding objective of ensuring justice, and that the six-month time limit to file a Notice of Appointment is directory, not mandatory. Finding no prejudice to the defendant and noting active case management by the plaintiff, the Court dismissed the developer’s strike-out bid and allowed an extension of time for assessment to proceed. The decision underscores the judiciary’s commitment to substantive fairness over procedural rigidity in post-judgment proceedings.

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TORT – PURE ECONOMIC LOSS BAR REAFFIRMED: MMC LIABLE FOR NEGLIGENCE BUT PROTECTED FROM LOST PROFIT CLAIMS

16 November ,2025

In Asia Pacific Higher Learning Sdn Bhd v Majlis Perubatan Malaysia & Anor [2025] MLJU 3144, the High Court awarded over RM2 million in damages against the Malaysian Medical Council (MMC) for negligence, breach of statutory duty, and misfeasance during its accreditation of Lincoln University College’s medical programmes. While the court allowed direct financial losses such as survey costs, it barred claims exceeding RM550 million for lost profits, reaffirming the Federal Court’s rulings in Steven Phoa and UDA Holdings that pure economic loss is not recoverable from public or statutory bodies. The second defendant was further ordered to pay RM100,000 in exemplary damages for acting with targeted malice, marking a rare personal liability finding against a regulatory officer.

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ERINFORD INJUNCTION – COURT OF APPEAL CLARIFIES: EX-PARTE ERINFORD INJUNCTIONS ARE THE EXCEPTION, NOT THE RULE

16 November ,2025

In Edisijuta Parking Sdn Bhd v TH Universal Builders Sdn Bhd & Anor [2025] 5 MLJ 524, the Court of Appeal clarified that ex parte Erinford injunctions at the appellate stage should only be granted in truly exceptional circumstances where giving notice would defeat the purpose of the order. Wong Kian Kheong JCA held that, under rule 50 of the Rules of the Court of Appeal 1994, such applications should generally be heard inter partes to ensure fairness and prevent abuse. Exercising powers under section 44(1) of the Courts of Judicature Act 1964, the Court granted a conditional interim Erinford injunction pending appeal, fortified by a RM200,000 deposit and an undertaking to pay damages. The ruling provides clear guidance on balancing urgency, procedural fairness, and judicial efficiency in appellate injunctions.

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TOTAL FAILURE CONSIDERATION – FEDERAL COURT OVERRULES BERJAYA TIMES SQUARE: TOTAL FAILURE OF CONSIDERATION REDEFINED

16 November ,2025

In Lim Swee Choo & Anor v Ong Koh Hou @ Won Kok Fong [2025] 6 MLJ 327, the Federal Court unanimously overruled Berjaya Times Square Sdn Bhd v M Concept Sdn Bhd and clarified that the doctrine of total failure of consideration applies only to restitutionary relief, not to contractual termination. The Court held that the correct test is whether the promisor has performed any part of the contractual duties in respect of which payment is due, adopting Stocznia Gdanska SA v Latvian Shipping Co [1998] 1 WLR 574. Finding that the appellants had partly performed their obligations and the respondent had derived benefits, the Court rejected the respondent’s claim for restitution and restored the appellants’ contractual claim. The landmark decision restores clarity between contract and restitution, reinforcing commercial certainty in Malaysian law.

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CONTRACT (BILL OF LADING) – NO DUTY TO DETECT FRAUD: COURT CLEARS MAERSK OF LIABILITY FOR FALSE CONTAINER WEIGHTS

16 November ,2025

In Stournaras Stylianos Monoprosopi EPE v Maersk A/S [2025] 2 Lloyd’s Rep 323, the English Commercial Court held that carriers are not liable for fraudulent misdeclarations by shippers where bills of lading are issued for sealed containers. The Court ruled that Maersk had no duty to verify or cross-check declared weights against Verified Gross Mass (VGM) data under the SOLAS Convention, as its obligation under the Hague Rules extended only to the apparent external condition of cargo. However, the judgment signals that a limited duty of care could arise in future where a carrier is put on notice of fraud. For now, carriers may rely on shipper declarations, but consignees must exercise commercial vigilance and due diligence when relying on bills for payment.

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EXEMPLARY DAMAGES – STATUTORY BODY DUTY – DAMAGES – OBTAINING APPROVAL

16 November ,2025

In Big Man Management Sdn Bhd v Tenaga Nasional Bhd [2025] 5 MLJ 290, the Federal Court reinstated nearly RM3.56 million in special damages and awarded RM100,000 in exemplary damages against TNB for wrongfully disconnecting electricity to an ice factory. The Court ruled that “strict proof” of special damages does not mean a higher burden beyond the civil standard of proof and affirmed that TNB, as a statutory monopoly, breached its statutory duty by using disconnection as leverage to collect payment. The judgment underscores that public utilities cannot misuse statutory powers, and consumers wrongfully deprived of essential services may be entitled to punitive remedies in exceptional cases.

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