EIKOBINA (M) SDN BHD V MENSA MERCANTILE (FAR EAST) PTE LTD Facts : 1) This case is between Eikobina

(M) Sdn Bhd, the vendor and Mensa Merchantile (Far East) Pte Ltd., the buyer. The appellant,(the vendor) agreed to sell the respondent (the buyer) 24 units of heavy construction equipment. 2) After the agreement was entered into but before the delivery of the goods, the buyer resold 15 units to sub-buyers, leaving nine units unsold. 3) On the date of delivery of the goods, the vendor failed to deliver the goods. 4) The buyer sued for specific performance of the agreement, general damages for the breach of contract and damages for loss of agency to sell other units of similar goods that is other units unsold for the vendor.

How the Court Assess Damages: Registrar (High Court) 1. Loss of profit: RM 1 766 429 Based on the market price of the goods on a date other than the date of breach. Trial Judge (High Court) Supreme Court Set aside Hadley v Baxendale 2 (test of remoteness) 1) No compensation can be awarded for damage that is too remote. 2) In assessing damage that is not too remote, the correct measure of damages mut be adopted. - The loss of profit on 15 units of the goods sold before delivery and after contract could not be claimed as it was too remote by virtue of both rules in Hadley v Baxendale 2. - The specific loss of profit for the remaining unsold unit of goods could not also be claimed for the same reason because of the 1st rule. - The normal measure of damages is the difference btw the contract price and market price at the time of the breach where there is an available market for the goods. 2. Loss of sale commission: RM150 000 In respect of the loss of agency rights. Reduce to RM 120 000 Succeded in proving loss of commission.

Affirmed

3.

Loss of opportunity: RM456 000 Due to loss of confidence in the buyer on the part of its business associates and customers.

Set aside Affirmed It could not pass the test of remoteness laid down in Hadley v Baxendale 2, either on 1st rule or 2nd rule.