Yew Huoi, How & Associates | Leading Malaysia Law Firm

Menu
force majeure mco

FORCE MAJEURE DURING MOVEMENT CONTROL ORDER

Does force majeure clause in an SPA applies during Movement Control Order (“MCO”) to extend time under an SPA?

Most sale and purchase agreements (“SPA”) (including Schedule H and G SPA) and proforma
sale form do not have force majeure clause which allow termination, non-performance or delay of performance of the terms by reason of acts of God, war, flood, fire, epidemics etc.

In any event, the existence of a force majeure clause in a developer’s SPA (which has to comply with Schedule H or G of the Housing Development (Control & Licensing) Regulations 1989 (“HDR 1989”) was previously held by the Federal Court to be void. In short, an epidemic does not relieve the developer’s duty to complete the construction of building within the stipulated timeframe.

However, a sub-sale SPA may contain a force majeure clause.

Sample force majeure clause

“No party shall be liable to the other for any failure to fulfill any terms of the agreement if such fulfillment is delayed, hindered or prevented by force majuere including but not limited to Acts of God strikes lockouts riots civil commotion epidemics acts of war or failure to obtain any necessary approval of any local or other appropriate authority or any other circumstances of whatsoever nature beyond the control of the party”.

If there is such clause in your SPA, you may rely on Covid-19 pandemic and MCO to avoid the application of the terms in an SPA; including but not limited to extension of time and non-performance during this period.

Back to Latest Legal Updates

Recent Post

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

This legal update explores key provisions of the General Agreement on Tariffs and Trade (GATT 1947), focusing on Article I (Most-Favoured-Nation Treatment), Article II (Schedules of Concessions), Article XX (General Exceptions), and Article XXI (Security Exceptions). Article I mandates that any trade advantage granted by one contracting party to another must be extended unconditionally to all other parties. Article II ensures that imported goods from contracting parties receive treatment no less favourable than that outlined in agreed schedules, while also regulating permissible taxes and charges. Articles XX and XXI provide exceptions for measures necessary to protect public morals, health, security interests, and compliance with domestic laws. The provisions reflect the foundational principles of non-discrimination, transparency, and fair trade, while allowing for limited, well-defined exceptions. This summary is intended to provide a concise reference for businesses and legal practitioners involved in international trade law.

Read More »
3 April ,2025 No Comments

ROAD ACCIDENT – INSURANCE COMPANY STRIKES BACK: HIGH COURT OVERTURNS ROAD ACCIDENT CLAIM

When a motorcyclist claimed he was knocked down in an accident, the Sessions Court ruled in his favor, holding the other rider fully liable. But the insurance company wasn’t convinced. They appealed, arguing that there was no proof of a collision and even raised suspicions of fraud. The High Court took a closer look – and in a dramatic turn, overturned the decision, dismissed the claim, and awarded RM60,000 in costs to the insurer. This case is a stark reminder that in court, assumptions don’t win cases – evidence does.

Read More »
24 February ,2025 No Comments

CHARTERPARTY – LIEN ON SUB-FREIGHTS: CLARIFYING OWNERS’ RIGHTS AGAINST SUB-CHARTERERS

In Marchand Navigation Co v Olam Global Agri Pte Ltd and Anor [2025] 1 Lloyd’s Rep 92, the Singapore High Court upheld the owners’ right to enforce a lien on sub-freights under Clause 18 of the NYPE 1946 charterparty, ruling that the phrase ‘any amounts due under this charter’ was broad enough to cover unpaid bunker costs. Despite an arbitration clause between the owners and charterers, the sub-charterer was obligated to honor the lien, as it was not a party to the arbitration agreement. This decision reinforces that a properly exercised lien on sub-freights can be an effective tool for owners to recover unpaid sums, even in the presence of disputes between charterers and sub-charterers.

Read More »
24 February ,2025 No Comments

SHIP SALE – LOSING THE DEAL, LOSING THE DAMAGES? THE LILA LISBON CASE AND THE LIMITS OF MARKET LOSS RECOVERY

In “The Lila Lisbon” [2025] 1 Lloyd’s Rep 101, the court ruled that a buyer cancelling under Clause 14 of the Norwegian Salesform Memorandum of Agreement is not automatically entitled to loss of bargain damages unless the seller is in repudiatory breach. The case clarifies that failing to deliver by the cancellation date does not constitute non-delivery under the English Sale of Goods Act 1979, as the clause grants the buyer a discretionary right rather than imposing a firm obligation on the seller. This decision highlights the importance of precise contract drafting, particularly in ship sale agreements, where buyers must ensure that compensation for market loss is explicitly provided for.

Read More »
24 February ,2025 No Comments

CRIMINAL – KIDNAPPING – NO ESCAPE FROM JUSTICE: COURT UPHOLDS LIFE SENTENCE IN HIGH-PROFILE KIDNAPPING CASE

A 10-year-old child was abducted outside a tuition center, held captive, and released only after a RM1.75 million ransom was paid. The appellants were arrested following investigations, with their statements leading to the recovery of a portion of the ransom money. Despite denying involvement, they were convicted under the Kidnapping Act 1961 and sentenced to life imprisonment and ten strokes of the whip. Their appeal challenged the identification process, the validity of the charge, and the admissibility of evidence, but the court found the prosecution’s case to be strong, ruling that the appellants had acted in furtherance of a common intention and were equally liable for the crime.

Read More »
24 February ,2025 No Comments
en_USEN
zh_TWZH ms_MYMY en_USEN
× Contact Us