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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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Sorotan

ILLEGALITY AND CONTRACT – RM49 MILLION MISTAKE? ADW2 STRUCK DOWN FOR NO CONSIDERATION DIMENSI SDN BHD LEGALLY VALID?

In Kuala Dimensi Sdn Bhd v Port Kelang Authority [2025] 2 MLJ 238, the Federal Court reaffirmed a core principle of contract law – no consideration, no contract. The Court held that the supplemental agreement (ADW2), which increased interest payable by RM49 million, was void for want of consideration, despite being acted upon. Notably, the Court rejected the “practical benefit” doctrine from Williams v Roffey, clarifying that Malaysian law continues to uphold traditional consideration requirements. Estoppel, too, could not rescue the agreement. This case sends a clear message: contractual variations must be backed by clear and enforceable consideration, or risk being struck down.

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Sorotan

GAMBLING DEBT – NOT JUST A LOAN, STILL A GAMBLE – FEDERAL COURT DEALS FINAL BLOW TO CASINO CREDIT RECOVERY

In Dato’ Ting Ching Lee v Ting Siu Hua [2025] 2 MLJ 295, the Federal Court delivered a decisive ruling on the enforceability of gambling-related debts disguised as credit facilities. The Court held that credit lines granted for the sole purpose of purchasing casino chips constituted a composite gambling contract, not a genuine loan – and are therefore unenforceable under Malaysian law.

In overruling Wynn Resorts (Macau) SA v Poh Yang Hong, the Court reinforced that no matter how cleverly disguised, claims tied to gambling are void and against public policy. The decision serves as a stark reminder: Malaysian courts will not act as debt collectors for foreign casinos.

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Undang-undang Komersial

REGULATIONS – GENERAL AGREEMENT ON TARIFFS AND TRADE (GATT 1947 )

On 3.4.2025, the United States imposed a 24% tariff on Malaysian exports, triggering concerns over its legality under international trade law. The measure appears to breach core WTO obligations, including Most-Favoured Nation treatment and tariff bindings. Malaysia has strong grounds to challenge the tariff through WTO dispute settlement, though enforcement could be delayed due to the Appellate Body impasse. In the meantime, Malaysia is pursuing diplomatic avenues, highlighting the importance of rules-based trade amid rising global protectionism.

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Undang-undang Laksamana

SHIPPING – ADMIRALTY IN REM – ANCHORED BUT NOT ADRIFT: REDEFINING “SHIP” IN ADMIRALTY JURISDICTION

The Singapore High Court in Vallianz Shipbuilding & Engineering v Owner of the Vessel ‘Eco Spark’ [2025] 1 Lloyd’s Rep 195 clarified the definition of a ‘ship’ under admiralty jurisdiction. Despite conversion into a stationary floating fish farm, the vessel retained its status as a ship due to its inherent navigational capability, significantly broadening the scope of admiralty law.

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Undang-undang Hartanah

TORT OF NEGLIGENCE – STRATA MANAGEMENT – HOLDING DEVELOPERS ACCOUNTABLE FOR DEFECTS – A WIN FOR CONDO OWNERS!

The decision in Badan Pengurusan Bersama Subang Parkhomes v Zen Estates Sdn Bhd (Fadhlullah & Associates Consulting Engineers Sdn Bhd) [2025] 7 MLJ 780 emphasizes developers’ clear duty of care toward condominium residents, reinforcing their responsibility to properly rectify defects. It highlights the essential role developers play in ensuring quality and compliance, protecting residents from bearing unnecessary financial burdens arising from poorly completed projects.

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Tort

MEDICAL NEGLIGENCE & VICARIOUS LIABILITY – VACUUM EXTRACTION GONE WRONG: COURT HOLDS HOSPITAL LIABLE FOR CHILDBIRTH INJURY

The Court of Appeal decisively overturned the High Court’s findings, emphasizing the critical importance of accurate medical documentation and proper patient counseling. The hospital was held vicariously liable for its medical officer’s negligence, highlighting a clear judicial stance on protecting patient rights during childbirth procedures.

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Undang-undang Tanah

LAND LAWS – FEDERAL COURT SHIELDS BANKS – NO EXTRA HOMEWORK REQUIRED IN LAND LOANS!

In a landmark ruling, the Federal Court in Malayan Banking Bhd v Mohd Affandi bin Ahmad & Anor [2024] 6 MLJ 220 has reaffirmed that banks are not obligated to investigate past transactions beyond the land register before granting a loan. The case, which involved a dispute over land ownership and mortgage validity, clarified that under the Torrens System, a bank conducting a proper land search can rely on the registered title unless fraud is proven. This decision strengthens protection for lenders, ensuring that financing transactions remain efficient and commercially practical without the burden of additional due diligence on prior dealings.

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Sorotan

ROAD ACCIDENT – MOTOR INSURANCE CLAIM – FEDERAL COURT TO INSURERS – NO MORE DELAYING THIRD-PARTY PAYOUTS!

The Federal Court in Chen Boon Kwee v Berjaya Sompo Insurance Bhd [2025] 1 MLJ 158 delivered a crucial ruling that prevents insurers from forcing accident victims to file additional lawsuits to claim their rightful compensation. The court reaffirmed that once a third party has obtained a judgment against the insured, the insurer must pay – no extra legal hurdles, no unnecessary delays. This case marks a significant win for accident victims, ensuring they are not unfairly denied compensation due to procedural roadblocks.

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Recent Legal Updates

LEGAL UPDATES – THE SILENT CURVE: WHY MEDICAL PREMIUMS SUDDENLY SPIKE

Medical insurance premiums do not increase gradually. They rise exponentially. For many years, costs appear manageable, giving policyholders a false sense of stability. However, once the insured reaches their mid-60s, medical charges begin to accelerate sharply, and after age 70, they often outpace the premiums by several multiples.

This happens because medical insurance is funded from a finite pool of money – an investment “bucket” – while the medical rider functions like an engine that consumes more fuel as the insured ages. When the engine grows faster than the bucket can be replenished, depletion is inevitable. The result is sudden premium hikes, demands for top-ups, or policy lapse – not due to misconduct or missed payments, but due to the structural design of the product itself.

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THE ‘COVER UNTIL 99’ MYTH – WHY INSURANCE AGENTS GET IT WRONG

Consumers must stop relying on what insurance agents say and start reading what insurance policies actually provide. ‘Medical cover until 99’ does not mean guaranteed coverage at an affordable premium. In reality, medical insurance charges rise exponentially after age 70, often making the policy mathematically unsustainable. By the time policyholders realise this, they are told to top up tens of thousands of ringgit or lose coverage altogether.

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STRATA TITLES ACT – DEVELOPER MUST ACCOUNT FOR COMMON PROPERTY COMPENSATION: HIGH COURT IMPOSES CONSTRUCTIVE TRUST

In JMB Kelana Square v Perantara Properties Sdn Bhd & Ors [2025] 12 MLJ 51, the High Court held that a developer who received compensation for land compulsorily acquired for the LRT 3 project could not retain sums attributable to common property. Although the compensation was paid entirely to the developer as registered proprietor, the Court found that part of the acquired land constituted common property, and the developer therefore held RM6.05 million on constructive trust for the Joint Management Body. The decision affirms that JMBs have proprietary standing to recover compensation for common property and that courts will intervene to prevent unjust enrichment in strata developments.

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UNFAIR DISMISSAL – MEDICAL LEAVE IS NOT MISCONDUCT: HIGH COURT UPHOLDS INDUSTRIAL COURT’S PROTECTION OF SICK EMPLOYEE

In Aerodarat Services Sdn Bhd v Lawerance Raj a/l Arrulsamy & Anor [2025] 11 MLJ 26, the High Court dismissed an employer’s judicial review and affirmed that prolonged medical leave does not, by itself, amount to misconduct justifying dismissal. The Court held that the employer failed to prove the critical element of intention not to return to work or unwillingness to perform contractual duties, despite high absenteeism caused by serious illness and surgery. The ruling reinforces that employers must distinguish between genuine illness and misconduct, and cannot rely on medical absence alone to terminate employment.

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WILL AND PROBATE – COURT OF APPEAL INVALIDATES WILL OF 97-YEAR-OLD TESTATOR: CAPACITY, SUSPICION AND UNDUE INFLUENCE PROVED

In Kong Kin Lay & Ors v Kong Kin Siong & Ors [2025] 5 MLJ 891, the Court of Appeal set aside a will executed by a 97-year-old testator, holding that there was real doubt as to testamentary capacity, compounded by serious suspicious circumstances and undue influence by certain beneficiaries. The Court emphasised that while the “golden rule” is not a rule of law, failure to obtain medical confirmation of capacity where doubt exists is a grave omission. Credibility issues with the drafting solicitor, beneficiary involvement in the will’s preparation, and suppression of evidence led the Court to declare the will invalid and order intestacy.

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NOT AN ‘AGREEMENT TO AGREE’: ENGLISH COURT OF APPEAL SAVES LONG-TERM SUPPLY CONTRACT DESPITE OPEN PRICE CLAUSE

In KSY Juice Blends UK Ltd v Citrosuco GmbH [2025] 2 Lloyd’s Rep 581, the UK Court of Appeal held that a long-term supply contract was not unenforceable merely because part of the price was stated as “open price to be fixed”. The Court implied a term that, in the absence of agreement, the price would be a reasonable or market price, noting that the product’s value could be objectively benchmarked against the market price of frozen concentrated orange juice. Emphasising that courts should preserve commercial bargains rather than destroy them, the decision confirms that section 8(2) of the Sale of Goods Act 1979 operates as a saving provision, not a bar to enforceability.

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