KUALA LUMPUR – Sri Ledang Ventures Sdn Bhd (SLV) has lost its legal battle to claim RM14 million from the government which terminated its contracts on rentals and supplies for the National Service (NS) programme after Putrajaya’s decision to suspend it.
Judicial Commissioner Roz Mawar Rozain, in dismissing the company’s claims, also ordered it to pay RM50,000 in costs to the government.
She dismissed SLV’s claims after finding that the termination clause inked by the company and the government was clear and unambiguous.
Neither had SLV provided evidence during trial to suggest that termination of the contract was done in bad faith or unreasonably, the judicial commissioner added.
Furthermore, the decision to abolish the NS programme was within the government’s ambit, as stated in the contract’s termination clause.
“This court also found that the defendant (government) had fully complied with the procedural and substantive requirements when terminating the contract, as it was carried out in accordance with the terms that both parties had freely agreed to in the outset of their contractual relationship.
“The termination of the contract of the defendant as per (the termination) clause was lawful and valid. In that conclusion, there shall be no damages awarded to the plaintiff,” Roz Mawar said in her decision issued yesterday.
“Parties are bound by the terms they have freely agreed to, as stated in the Contract Law. It is a fundamental principle of the law that parties must be bound by the terms that they have fully agreed with and the terms are clear and unambiguous.
“This case serves as a salient reminder that when government contracts, despite common misconception, are not inherently more secure or profitable than other commercial agreements,” she added.
As a dissolved company, SLV had obtained approval from the Insolvency Department to file its suit against the government.
It had signed a contract with the Defense Ministry in 2005 valued at RM14.523 million for a period of four years, for the company to provide rental of services and food supplies for the NS programme at Kem PLKN Sri Ledang.
SLV’s contract for the NS programme was extended and renewed until 2018, when Pakatan Harapan took over the federal government and announced that it was ended the programme.
The company was informed of the contract termination in September 2018. In its statement of claim, SLV said it and other camp operators attempted to appeal to the government to withdraw the contract terminations.
The judge also dismissed the company’s claims of outstanding payments, worth more than RM4 million, comprising of government’s failure to pay additional services from 2017 to 2018, full payments for the provision of food to NS trainees from 2014 to 2018; and payments for rental services from 2014 to 2015, after finding that their claims were unsustainable. – July 31, 2024