A breach of contract in Malaysia results in the right to terminate, face monetary claims, or seek court orders. The primary legal remedies available under the Contracts Act 1950 and common law include damages, specific performance, and rescission.
Consequences of a Breach
- Discharge or Termination: The innocent party can treat the contract as ended if the term broken is vital.
- Liability for Loss: The party at fault must compensate for direct and natural financial losses.
- Liquidated Damages Action: Pre-agreed sums in a contract act as a maximum ceiling of recovery subject to court proof of reasonableness under Section 75.
Available Legal Remedies
- Damages (Compensation): Regulated by Section 74 of the Contracts Act 1950, money is awarded to put the injured party in the position they would have been in had the contract been honored.
- Specific Performance: A discretionary court order under the Specific Relief Act 1950 forcing the culprit to finish their promised job, typically used for unique items like land.
- Injunction: A court command stopping a party from doing an act that violates the agreement.
- Rescission: Canceling the agreement and returning both sides to their pre-contract positions.
- Quantum Meruit: Asking for fair pay for work already done before the breach stopped the task.
Choosing a Court Forum
- Magistrates' Court: For claims up to RM100,000.
- Sessions Court: For claims from RM100,001 to RM1,000,000.
- High Court: For claims exceeding RM1,000,000.
No comments:
Post a Comment