RM268,000 for an assistance letter?

Help doesn’t usually come free in commercial transactions, and even just one signature can come with a very high price.

A PERSON may, from time to time, need help. It is often believed that when help is asked for, it is given gratuitously.

In present times, and more so in commercial transactions, “help” cannot usually be expected to be free. One such case is where a housing developer seeks help from another to get approval or early approval for conversion or subdivision of the land.

Such was the case of Wong Hon Leong David v. Noorazman bin Adnan. The Appellant, David Wong, was a director of a company named Wealth Sdn Bhd which had submitted an application to the Land Administrator for conversion and subdivision of the land.

At the time of acquisition, the land was classified as agricultural land. There was also a problem of access to the land in question.

The Appellant was introduced to the Respondent, Noorazman Adnan. According to the Appellant, the Respondent told him that he knew the Mentri Besar and other senior state government officers and that he was prepared to assist in the matter. He expected to be paid RM268,000 for his services.

The Appellant, in his personal capacity, agreed to pay if the Respondent would assist in obtaining speedy approval from the state authority. Following this, a letter dated Jan 28, 1991 was written on the Company’s letterhead to the Mentri Besar and it was signed by the Respondent as project manager for the purpose.

It made representations on behalf of the Company. These referred to the Company’s application for conversion and subdivision. It asked for early approval of the application.

Towards the end of 1991, the Respondent showed the Appellant the letter to the Mentri Besar with an endorsement on a corner of the letter, disokong (approved) by the Mentri Besar. Upon seeing this endorsement, the Appellant paid RM100,000.

In the meantime, upon receipt of a letter from the Land Administrator, the access issue remained unresolved. The Appellant sought the help of the Respondent. The Respondent said that payment of RM100,000 was required for him to do so.

In fact, on Dec 17, 1991, the Respondent had written to the Appellant confirming an agreement between them whereby the former was to receive an additional RM100,000. There was no reply.

Payment as claimed not being made, the Respondent filed an action to recover the balance of the agreed sum RM268,888 less RM100,000 received and RM100,000 additional payment.

In the High Court, the Respondent obtained Summary Judgment for the sum of RM168,000. However, unconditional leave to defend was given in respect of the additional RM100,000. Hence the appeal by Wong to the Court of Appeal.

The Appellant contended that the Respondent told the defendant that he knew the Mentri Besar of Selangor, some executive council members and some government officers and was promised that he could expedite the conversion and subdivision so that they could be obtained within a year.

During the appeal, it was argued by the Appellant that the Respondent had failed to secure the approval within one year and apart from signing the letter, he did nothing. There was therefore no consideration in this regard.

The Court relied on the Contracts Act 1950 which reads, “When, at the desire of the promisor, the promisee or any other person has done or abstained from doing, or does or abstains from doing, or promises to do or to abstain from doing, something, such act or abstinence or promise is called a consideration for the promise.”

The case of Lampleigh v. Brathwait was cited. In order to obtain a pardon for the Defendant, the Plaintiff exerted himself, “riding and journeying to and from London and Newmarket”, at his own expense. Brathwait later promised to pay him £100 for his trouble, but failed to do so.

Lampleigh sued and succeeded on the ground that services had been rendered at the request of Brathwait. The Court below took the view that “if Lampleigh could recover for his services, it would be difficult to understand why in the case before the Court, the Respondent should not be able to do so”.

Wong also contended that the claim that was being made was illegal in that it involved bribery. The Court noted that it was a serious allegation and that if this was so, it is also implied that the Appellant was prepared to indulge in bribery of a public official in order to achieve the purpose on behalf of the Company.

The Appellant had not lodged a contemporaneous police report complaining about the demand for a bribe though during the adjournment of the hearing in the Court below, the Appellant lodged a police report to the effect. This was after the Judge in the Court below pointed this out to the Appellant.

There was no evidence of any acts of bribery in the evidence before the Court below. Nor was this raised in any of the affidavits that were filed. As such, the Court was not able to consider these allegations.

The Court also did not accept that the Respondent did nothing to earn his fee. Obviously, therefore, it was not a case where all that was done by the Respondent was signing a letter to the Mentri Besar.

There would have been more effort expended. Thus, on the evidence, the Court could only decide in favour of the Respondent.