KUALA LUMPUR (Oct 18): Valiant First Sdn Bhd has filed a suit against aviation and defence company Destini Bhd, seeking specific performance for the completion of the sale of two plots of land in Glenmarie and Bukit Jelutong.

In the statement of claim viewed by The Edge, Destini had agreed to sell the plots of industrial land to Valiant First for a cumulative RM24.5 million. The purchase price of the Glenmarie land was RM19.5 million and the Bukit Jelutong land was RM5 million.

Destini had signed the sale and purchase agreements (SPAs), received deposits, but subsequently terminated the SPAs.

On April 26 this year, Valiant First, an investment holding company, paid RM147,000 in earnest deposit for the Bukit Jelutong land and RM390,000 for the Glenmarie land.

The SPAs for both plots of land were executed on June 13 and forwarded to Destini’s solicitors. Valiant First claims that it made further balance deposit payments to Destini of RM203,000 for the Bukit Jelutong land and RM975,000 for the Glenmarie land. Of those deposit payments, Destini received RM97,000 for Bukit Jelutong and RM561,600 in two cheques dated June 9, 2023, amounting to RM658,600 in total.

On June 16, Destini’s solicitors confirmed in writing that Destini had executed the SPAs and that it would be forwarded to Valiant First’s solicitors after June 20.

Valiant First in its statement of claim said Destini’s agreement to send the relevant documents to Valiant First to complete the land purchases had fallen flat.

Valiant First claims that more than a month went by without any response from Destini or its solicitors, even though it was ready to conclude the transactions pertaining to the SPAs and the land purchases.

Caveats were then placed on both plots of land in August to protect Valiant First's interests as the purchaser of the plots.

Destini unlawfully terminated the land purchases

On Aug 21, Destini’s solicitors wrote to Valiant First’s solicitors stating that Destini was unable to complete the sale of the plots of land as it was unable to fulfil the conditions, therefore terminating the SPAs. The conditions, however, were not specified in the letter.

Valiant First claims that Destini deliberately and/or simply did not want to perform the transactions despite all the terms of sale being agreed and despite Destini’s solicitors' confirmation that Destini had duly executed the SPAs.

“The plaintiff (Valiant First) further claims that Destini is bound to sell and perform the terms of the SPAs as they had received and kept the deposit payments since April and June respectively and all the terms and conditions of the SPAs had been finalised,” said Valiant First's statement of claim, adding that the SPAs remain valid, subsisting and binding among parties.

Destini, in a letter to Valiant First’s solicitors on Aug 30, stated it had terminated the appointment of its solicitors and that Destini was unable to obtain approval from its board of directors for the intended sale and purchase transaction. This approval is required under Section 233(1) of the Companies Act 2016.

Valiant First, in the statement of claim said the reasons for termination in Destini’s letter were arbitrary, without basis and unlawful.

“The alleged inability to secure the board of directors' approval as a reason for termination of the concluded sale and purchase is an afterthought in light of the fact that the letters of offers to sell and purchase and the sale and purchase agreements had been duly executed by parties. This was in addition to the representations, promises and conclusive agreements to complete the sale and purchase agreements on the part of the defendant,” it said.

The claim also stated that Destini had returned the earnest deposit sum of RM537,000 which it had encashed to Valiant First. The earnest deposit sum returned to Valiant First’s solicitors is now being retained on a without prejudice basis pending the determination of the suit, the claim read. Destini had also failed to return the aforementioned balance deposit sum of RM658,600 to Valiant First.

“Valiant verily believes that Destini will continue to fail and refuse to perform its obligations under the sale and purchase agreements and to complete the sale transaction to the plaintiff unless there is a judgement and an order for specific performance issued against Destini,” it said.

Valiant First also claimed that it is at all material times ready and willing to complete the transactions and is seeking a declaration that the defendant's termination of the Bukit Jelutong and Glenmarie SPAs is unlawful and that the SPAs are still valid.

A check on Destini’s website shows that former Dewan Rakyat speaker Tan Sri Azhar Azizan Harun is listed as an independent and non-executive director of Destini, while Datuk Abdul Aziz Sheikh Fadzir — a former member of Parliament of Kulim — is listed as a non-independent and non-executive director.

The suit was filed by lawyer Aravind Ramakrishnan of Messrs A R Krishnan & Partners on behalf of Valiant First at the High Court in Shah Alam. The court set Nov 8 for case management.