Yew Huoi, How & Associates | Leading Malaysia Law Firm

Menu
Pro
  • Legal Updates from YHA Law Firm

PROFORMA SALE FORM DURING MOVEMENT CONTROL ORDER

“I have signed a proforma sale form which requires a sale and purchase agreement to be prepared within 21 working days.”

“What happened if I am unable to comply with the 21 working days period as no law firm is operating during this period.”

Most proforma sale form or booking form would have a term which requires a sale and purchase agreement (“SPA”) to be prepared within 21 “working days”.

A working day normally means a calendar day which is the day as distinguished from a holiday. However, the recently announced nationwide Restriction of Movement Order (“MCO”) is not holiday. It merely, among others, restricts movement and assembly nationwide.

However, the 21 working days will be extended for the entire duration of the MCO as law firms were reproached by the Bar Council to remain open for business. The working day as contemplated in the booking form is therefore vitiated by the fact that lawyers are unable to access to their physical office for the purpose of retrieving files, documents and using the facilities of their office to prepare the SPA. Therefore, the period under MCO could not be considered “working days”.

“Can I terminate the agreement as evidenced in the proforma sale form or booking form by relying on the doctrine of frustration?”

Section 57 of the Contracts Act 1950 (“CA 1950”) (which embodies the doctrine of frustration) provides that

“(a) contract to do an act which, after the contract is made, becomes impossible, or by reason of some event which the promisor could not prevent,unlawful, becomes void when the act becomes impossible or unlawful.” An agreement to do an act impossible in itself is void.”

However, one of the 3 important elements of frustration is that the alleged frustrating event “must be such that renders it radically different from that which was undertaken by the contract”.

A proforma sale form or booking form sets out the salient term of a sale and purchase i.e. the identity of the parties, the description of the property and the price. The requirement of a SPA to be signed is mere formality.

Hence, the MCO which merely affects the formality of having to sign the SPA within 21 days does not radically alters the salient terms of the sale and purchase i.e. i.e. the identity of the parties, the description of the property and the price. Therefore, doctrine of frustration does not apply.

Back to Latest Legal Updates

Recent Post

ADMIRALTY IN REM – WRONGFUL ARREST – POSSESORY RIGHT – ARREST GONE WRONG: WHEN A SHIP ARREST BACKFIRES WITH DAMAGES

In Eletson Holdings Inc & Ors v The Vessel “Paros” [2026] 8 MLJ 80, the High Court set aside an arrest after finding that the plaintiffs had no proprietary or possessory right to the vessel at the time of the writ, as the bareboat charter had already been terminated. The Court held that the claim was in substance a corporate control dispute dressed up as an admiralty action, and emphasised that such disputes do not fall within admiralty jurisdiction. Critically, the plaintiffs’ failure to disclose the termination of the charter when obtaining the arrest warrant amounted to a serious breach, leading the Court to find mala fides or gross negligence and order damages for wrongful arrest. The decision reinforces that ship arrest is a powerful remedy that must be exercised with full disclosure and a proper maritime foundation.

Read More »
14 July ,2026 尚無留言

GUARANTEE – PERSONAL GUARANTEE ≠ PAY ON DEMAND: COURT DRAWS THE LINE BETWEEN SURETYSHIP AND DEMAND GUARANTEES

In CE Energy DMCC v Bashar [2026] Lloyds’s Rep 267, the Commercial Court clarified that not all guarantees labelled “on demand” will be treated as demand guarantees. On a proper construction, the court held that the personal guarantee in question was a contract of suretyship, requiring proof of the principal debtor’s liability rather than automatic payment upon demand. Crucially, the court found that the debtor’s “irrevocable” admissions of debt in a payment agreement created a binding contractual estoppel, which the guarantor could not challenge. The decision also confirms that, where payment is due on a “day certain”, a seller may still claim the price notwithstanding retention of title. The case underscores the importance of precise drafting and the risks of entering into settlement agreements that conclusively fix liability.

Read More »
14 July ,2026 尚無留言

MARITIME NEGLIGENCE – PLAINTIFF CLAIMED FOR DAMAGES CAUSED DURING ANCHOR DEPLOYMENT OPERATION – CALDERBANK OFFERS

In Tom Eastwind 365 Sdn Bhd v The Owners of the Vessel “Icon Sophia” [2025] 9 MLJ 397, the High Court held that the doctrine of res ipsa loquitur applied in a maritime collision during an anchor deployment operation, allowing an inference of negligence against the tug owner. The Court clarified that the doctrine is not defeated merely because the defendant adduces evidence explaining the accident – such evidence goes to rebutting the inference, not preventing it. While liability was established due to the tug master’s error of judgment in manoeuvring too close to a stationary barge, the plaintiff failed to properly prove its damages and was awarded only RM50,000. Notably, despite succeeding on liability, the plaintiff was ordered to pay costs after rejecting reasonable Calderbank offers, underscoring the risks of pursuing litigation without properly substantiated claims.

Read More »
14 July ,2026 尚無留言

JURISDICTION – BILLS OF LADING – BREACH OF HIMALAYA CLAUSE – BREACH OF EXCLUSIVE JURISDICTION CLAUSE – ONEROUS OR UNUSUAL TERMS

In Maersk Guinéa-Bissau SARL v Almar-Hum Bubacar Baldé SARL [2026] 1 Lloyd’s Rep 215, the English Commercial Court held that a shipper was liable for breach of an exclusive jurisdiction clause and a Himalaya clause after commencing proceedings in Guinea-Bissau instead of England. The Court confirmed that such clauses are standard and enforceable, and that commencing foreign proceedings in breach of them can give rise to a claim for damages. Notably, the Court also recognised that Himalaya clauses may be used offensively, allowing subcontractors to recover losses caused by wrongful litigation. The foreign judgment was not recognised due to lack of jurisdiction and denial of natural justice.

Read More »
14 July ,2026 尚無留言

DELIVERY WITHOUT PRESENTATION OF BILL OF LADING – LOI WON’T SAVE YOU: SHIPOWNER LIABLE FOR MISDELIVERY DESPITE INDEMNITY

In United Overseas Bank Ltd v The “Maersk Katalin” [2026] 1 Lloyd’s Rep 18, the Singapore High Court reaffirmed that delivery of cargo without presentation of original bills of lading remains a fundamental breach, even where carried out against letters of indemnity. The Court held that LOIs merely shift commercial risk but do not authorise misdelivery, and rejected arguments of consent, ratification and causation. Significantly, the Court emphasised that the burden lies on the carrier to prove that the loss would have occurred in any event – a burden not easily discharged. The decision underscores the continued strict liability regime in misdelivery cases, particularly where banks as bill holders are involved.

Read More »
14 July ,2026 尚無留言

CONTRACT LAW – ‘UK COURTS’ MEANS ENGLAND: COURT UPHOLDS JURISDICTION DESPITE VAGUE CLAUSE

In SMT Global Logistics Ltd v Georgian Airlines LLC [2025] Lloyd’s Rep. Plus 89, the Commercial Court held that a clause referring disputes to “the court in accordance with current legislation of the United Kingdom” was a valid jurisdiction clause in favour of the High Court of England and Wales. The Court also confirmed that the Montreal Convention does not apply to pure contractual claims for non-performance, such as repayment and loss of profits. Emphasising a broad and commercially sensible interpretation, the Court enforced the parties’ choice of forum and refused to stay proceedings, reaffirming that jurisdiction clauses will be upheld unless there are overwhelming reasons to depart.

Read More »
14 July ,2026 尚無留言
zh_TWZH
en_USEN ms_MYMY zh_TWZH