The Federal Court today affirmed the Court of Appeal's ruling that Berjaya Development Sdn Bhd had no cause of action against Keretapi Tanah Melayu Bhd (KTMB) for breach of contract over leasing agreement of a 3.26 acre plot in Sentul, which was considered the oldest football field in the country.

Chief Judge of Sabah and Sarawak Richard Malanjum, who sat with Federal Court judges Hashim Yusof and James Foong, unanimously dismissed Berjaya Development's application for leave to appeal against the Sept 19, 2007, decision.

Malanjum also ordered the company to pay KTMB costs of RM10,000.

Berjaya Development filed the suit against KTMB as first defendant and Railway Assets Corporation (RAC) as second defendant on 1994 for breach of contract over leasing agreement of the land, seeking specific performance or alternative damages of RM3.5 million, claiming that the action to terminate the lease agreement had caused the company to lose a lucrative business opportunity.

Among others, the agreed terms were that Berjaya Development was required to build a shopping complex, a health and commercial centre in phases which involved a budget of not less than RM3.5 million, on the said land.

On April 23, 1982, a lease agreement under seal was entered into between Berjaya Development and the General Manager of the Malayan Railway for and on behalf of the Federal Lands Commissioner in respect of a railway reserve.

The lease was for 30 years with an option to renew for a further period of 30 years at an agreed rental.

However, two years later, on Dec 12, the lease was terminated by the Malayan Railway Administration purportedly under a government directive and after that, there were negotiations between the parties to grant Berjaya Development a lease on short term which did not materialise.

Not the right party to be sued

On Sept 11, 1997, the High Court dismissed with costs Berjaya Development's appeal against the decision of senior assistant registrar (SAR) who struck out the company's suit against KTMB and RAC.

However, the Court of Appeal ruled that RAC was the right party to be sued and the case was sent back to the High Court for trial.

Today Berjaya Development's counsel, M Manoharan, in arguing for leave to appeal, said KTMB was the successor company to Malayan Railway and was the rightful party to be sued.

He said that the suit was not a plain and obvious case as it involved reserve land and the High Court was wrong when it strike out the suit.

KTMB's counsel, K Kumar, replied that the agreement was made between Berjaya Development and Malayan Railway and KTMB was not the party to be sued.

- Bernama