Aje Best-On Sdn Bhd v Samdo Smart Solar (M) Sdn Bhd (WA-22NCC-876-12/2023)

The Plaintiffs sue the Defendants for breach of a Collaboration cum Sale of Business Agreement dated 26.4.2022 Collaboration Agreement and a Supplemental Agreement thereto dated 14.6.2022 Supplemental Agreement . In turn, the Defendants made a counterclaim against the Plaintiffs for breach of the same agreements aforesaid, as well as breach of a shareholders agreement and a shares subscription agreement, both dated 8.7.2022.

The 3rd Defendant did not file an appearance in this suit. The Plaintiffs have entered a judgment in default of appearance against the 3rd Defendant. As such, this judgment pertains only to the 1st Defendant Samdo and the 2nd Mani .

After a full trial, I dismissed the Plaintiffs . I allowed the counterclaim only in respect of the payment of the balance consideration under the Collaboration Agreement. Here are my reasons. Background facts

On 26.4.2022, the Plaintiffs, the Defendants and Elemen Dimensi Elemen Dimensi the Collaboration Agreement. Under the Collaboration Agreement :

(a) Samdo was to sell its business and assets to the 1st Plaintiff P1 ; and

(b) After the completion of the sale of business and assets, Mani, the 3rd Defendant and Elemen Dimensi were to subscribe for shares in P1 through the shares subscription agreement and enter into the shareholders agreement with the 2nd P2 in respect of and as shareholders of P1.

On 13.6.2022 and pursuant to clause 4 (i) of the Collaboration Agreement, the Defendants caused P1 and Mestron Engineering Sdn Bhd Mestron sign a deed of n Mestron Deed of Novation On 14.6.2022, the Plaintiffs, the Defendants and Elemen Dimensi entered into the Supplemental Agreement.

On 8.7.2022, the Plaintiffs, Mani, the 3rd Defendant and Elemen Dimensi entered into the shares subscription agreement and the shareholders agreement. Following thereto, Mani, the 3rd Defendant and Elemen Dimensi became shareholders of P1. Mani was made an executive director of P1. The claim against the Defendants

The Plaintiffs plead that pursuant to clause 4 (i) of the Collaboration Agreement and the Supplemental Agreement, the Collaboration Agreement Unconditional Date . The Collaboration Agreement was to be completed on 8.7.2022 Completion Date

The Plaintiffs contend that under clause 5.4 of the Collaboration Agreement, P1 became entitled to Samdo future earnings with effect from the Unconditional Date. Further, that the Defendants jointly and severally guaranteed payments of such future earnings in respect of the contracts listed in Part A of Annexure 1 (agreement / contract) and Samdo assets and business, until the expiry of the said contracts (future earnings guarantee).

The Plaintiffs plead that, from the Unconditional Date, Samdo owed P1 future earnings as follows :

(a) RM 105,018.43, being the profit sharing as of 7.7.2022 under the Mestron Deed of Novation;

(b) RM 2,534, being the profit guarantee for the Sacofa solar hybrid site as of 7.7.2022; and

(c) RM 270.56, being the rental for the Sacofa solar hybrid site for 8.7.2022.

The Plaintiffs further rely on clause 5.6 of the Collaboration Agreement, pleading that Samdo was also obligated to pay P1 any proceeds, income, rent and money derived from the new contracts entered into after the Unconditional Date.

The Plaintiffs contend that the Defendants jointly and severally breached the Collaboration Agreement and the Supplemental Agreement by :

(a) failing to pay P1 the sum of RM 300,936.92, from the excluded assets under clause 3A.1 and clause 3A.2;

(b) failing to pay Mestron monies due by Samdo under clause 5.2 by the Unconditional Date;

(c) failing to pay P1 the guaranteed future earnings under clause 5.4 from the Unconditional Date to 31.7.2023;

(d) failing to pay P1 the proceeds under clause 5.6 arising from the new contracts; and

(e) failing to cease Samdo Collaboration Agreement.

As a result, the Plaintiffs claim RM 732,857.13 against the Defendants, jointly and severally, as particularised in paragraph 21 of the statement of claim.

The Plaintiffs further plead that they suffered additional losses arising ollaboration Agreement through the :

(a) failure to pay P1 guaranteed future earnings until expiry or termination of the contracts listed in Part A of Annexure 1 (agreement / contract) provided under clause 5.4;

(b) failure to cease Samdo

(c) causing P1 to breach the contracts listed in Part A of Annexure 1 (agreement / contract), resulting in the liquidated ascertained damages for non - performing towers, contrary to clause 9 (iii);

(d) failure to inform Sacofa Sdn Bhd Sacofa of the transfer of business and assets while continuing to receive payments from Sacofa;

(e) failure to procure the execution of the Edotco novation agreement pursuant to clause 4.1.

On this basis, the Plaintiffs claim further sums of RM 1,799,563.30 and RM 22,386.27 against the Defendants, jointly and severally, as particularised in paragraph 26 of the statement of claim. The Collaboration Agreement and the Supplemental Agreement

The salient terms of the Collaboration Agreement are reproduced below. A. Excluded Assets

3A.1 In consideration of the Purchaser agreeing to the the Vendor to continue to conduct business using the goodwill and reputation of the Business but solely and strictly restricted to the Excluded Assets only, the Vendor (together with MK, WBY and EDSB) have jointly and severally agreed to pay the Purchaser a part of the proceeds, income, rentals and monies earned from the Excluded Assets equivalent to Ringgit Malaysia Three Hundred Thousand Nine Hundred Thirty Six and Sen Ninety Two (RM 300,936.92) only

3A.2 The Vendor (together with MK, WBY and EDSB) shall jointly and severally upon the Vendor having received the proceeds, income, rentals and monies earned from the Excluded Assets or immediately upon the expiration of six (6) months from the

5.2 The Vendor shall pay and settle all liabilities, claims, debts and monies incurred and / or still owed by it to any person or party in respect of the Assets and Business as at the Unconditional Date. Further, the Vendor together with MK, WBY and EDSB hereby agree to jointly and severally bear and pay to Mestron all debts and monies incurred and / or still owed by the Vendor to Mestron under the JVA and shall not affect the Assets, Businesses and the Licenses whatsoever.

5.3 Subject to Clause 5.2 above, the Vendor shall be solely and absolutely entitled to the Existing Earnings of the Business from the date of execution of this agreement. In the event that the Purchaser shall receive any of the Existing Earnings to the Vendor.

5.4 The Purchaser shall be solely and absolutely entitled to the Future Earnings of the Business. In the event the Vendor shall receive any of the Future Future Earnings to the Purchaser. Further, the Vendor together with MK, WBY and EDSB hereby agree to jointly and severally guarantee the payment and collection of the Future Earnings up to the expiry or termination of each shall at their own costs and expenses take all steps and do all necessities to ensure that the Purchaser receives absolutely the Guaranteed Future Earnings from the said customers, commencing from the execution date of this Agreement. In the event that the Purchaser does not receive the Guaranteed Future Earnings in full for whatsoever reasons, then the Vendor together with MK, WBY and EDSB shall jointly and severally pay to the Purchaser the shortfall thereof.

5.6 iance of Clause 5A below, the Purchaser is allowed at any time after the Unconditional Date, to use the / or enter into any contracts, agreements, awards, letters and documents with any third party for, Vendor shall upon its receipt of the New Contract Earnings, forthwith return the same to the Purchaser

Subsequently the Collaboration Agreement was amended by the Supplemental Agreement, where the term : Existing Earnings means :- all the sale proceeds, income, rentals and monies earned from each of the Assets listed as Items 1 to 5 of Part A in Annexure 1 hereto prior to the Unconditional Date. Future Earnings means :- (i) all the sale proceeds, income, rentals and monies earned from each of the Assets listed as Items 1 to 5 of Part A in Annexure 1 hereto from the Unconditional Date onwards; The Defendants defence and counterclaim

At Mani defence and counterclaim was filed on behalf of the Defendants, as were subsequent pleadings in these proceedings. Samdo (through its new management under new shareholders) avers that it has no independent knowledge of the . Accordingly, Samdo will rely on Mani mounting its defence.

The Defendants counterclaim against the Plaintiffs the following sums due and owing under clause 3.1 of the Collaboration Agreement :

(a) failure to pay RM 400,000 to Samdo on the Completion Date or the Compliance Date, whichever is later as per clause 3.1 of the Collaboration Agreement; and

(b) failure to pay RM 1,142,536.90 on the Unconditional Date which fell on or before 14.6.2022, as per clause 3.1 (ii) of the Collaboration Agreement. Samdo indemnity claim against Mani

Pursuant to a share sale and purchase agreement, Mani sold all his shares in Samdo to the new shareholders. In the share sale and purchase agreement, Mani represented that :

(a) Samdo was a dormant company, held a Network Facilities Provider licence and had no contractual obligations;

(b) there are no adverse changes affecting Samdo share sale and purchase agreement;

(c) Samdo was not a party to materially restrictive contracts;

(d) Samdo was not a party to any contract, agreement or arrangement between Samdo and anyone who is or was a shareholder of Samdo;

(e) Samdo was not engaged in joint ventures or partnerships;

(f) Samdo was not a party to agreements in which Mani had an interest;

(g) no legal proceedings were ongoing, threatened or pending involving Samdo; and

(h) all information given by Mani was true, complete and accurate in all respects and Mani was not aware of any fact not disclosed which might affect the willingness of the new shareholders to enter into the share sale and purchase agreement.

In reliance on the above representations, the new shareholders executed the share sale and purchase agreement and assumed control and management of Samdo. Samdo avers that as sole director at all material times, Mani owed fiduciary duties to Samdo, including :

(a) to avoid conflicts of interest;

(b) to act honestly, in good faith and in the best interest of Samdo;

(c) to exercise powers for a proper purpose and not for personal gain or to the detriment of Samdo; and

(d) to declare interests in contracts to Samdo.

Samdo contends that the new shareholders were unaware of the present proceedings at all material times. Any positions taken in these proceedings were advanced by Mani, without the new s knowledge. The transactions relied upon by the Plaintiffs and Mani occurred prior to the share sale and purchase agreement and before the new shareholders became directors of Samdo. In the circumstances, Samdo claims.

Nevertheless, if the Plaintiffs succeed in proving their claim, Samdo contends that :

(a) Mani exercised his powers as a director of Samdo improperly and contrary to Samdo in both the Collaboration Agreement and P1;

(b) Mani failed to disclose his interests in the Collaboration Agreement;

(c) the Collaboration Agreement was not in Samdo as it prevented Samdo from conducting business;

(d) Mani acted in breach of section 218 (1) of the Companies Act 2016;

(e) Mani breached his statutory and fiduciary duties owed to Samdo; and

(f) any losses attributable to Samdo were caused solely by Mani acts and omissions. Mani defence to Samdo indemnity claim

Mani pleads that in May 2024, one Mr Mark of Omnix Sdn Bhd Mark offered to acquire Mani Samdo through the new proxies with Bumiputera status. Mani pleads that the sale of his shares in Samdo to to the following conditions :

(a) Mani had informed Mark that Samdo business activities had been sold to the Plaintiffs. Samdo was a shell company holding only a Network Facilities Provider licence.

(b) Upon completion of the sale of his shareholding in Samdo, Mani would retain absolute authority to manage and conduct the present proceedings on behalf of Samdo.

(c) The indemnity in respect of the present proceedings shall be subject to all of the aforesaid terms and conditions.

Mani pleads that it was agreed that he would sign on the signature page of the draft share sale and purchase agreement, following which the above conditions would be inserted and that he shall reserve the right to amend the said agreement. indemnity claim against Mani is not based on the share sale and purchase agreement.

Mani denies any breach of fiduciary duties and contends that the execution of the Collaboration Agreement and the Supplemental Agreement was proper. Mani pleads that Samdo is not entitled to any claim. Issues to be tried

The parties set out the following issues for determination :

(a) Whether the Defendants have breached the Collaboration Agreement and the Supplemental Agreement when they failed to meet their obligations under the said agreements, and are liable to pay the sum claimed?

(b) Whether the Defendants are jointly and severally liable to pay the sum of RM 732,857.13, being the debt due and owing under invoices as pleaded in paragraph 21 of the statement of claim? Namely : Particulars of the claim Amount I) Claim under clauses 3A.1, 5.2 and 5.4 of the Collaboration Agreement a) Debt under clause 3A.1 - excluded assets RM 300,936.92 b) Debt to Mestron for the solar hybrid project (as of 7.7.2022) RM 105,018.43 c) Future earnings guarantee : i) Profit sharing (as of 7.7.2022) RM 87,555.80 ii) Deficiencies of profit guarantee for the Sacofa solar hybrid site RM 2,534.00 iii) Rental for the Sacofa solar hybrid site RM 270.56 Total (I) RM 496,315.71 Claim under clause 5.6 of the Collaboration Agreement a) Rentals for hybrid solar tower received by Samdo RM 108,468.69 b) Monies received by Samdo from ZTE - DIGI RM 44,316.03 c) Monies received by Samdo from Binasat RM 79,796.70 d) Monies received by Samdo from Ericsson - Digital National Broadband RM 3,960.00 Total (II) RM 236,541.42 Total (I) and (II) RM 732,857.13

(c) Whether the Defendants are jointly and severally liable to pay the sum of RM 1,799,563.30 for losses suffered by the Plaintiffs ? Namely :

(i) loss of rental income due to the non - performing towers in the sum of RM 850,224.35;

(d) Whether the Defendants are jointly and severally liable to pay the sum of RM 22,2386.27, being the rental due to the Plaintiffs for the Sacofa solar hybrid sites?

(e) Whether the Defendants are entitled to claim for the following reliefs against the Plaintiffs :

(i) the sum of RM 1,642,635, being the balance purchase price of Samdo clause 3.1 of the Collaboration Agreement;

(f) In the event that the Plaintiffs succeed in their claims against the Defendants, whether Mani is liable to indemnify Samdo in respect of ? Evaluation of the P

By virtue of section 101 of the Evidence Act 1950, the Plaintiffs bear the legal burden of establishing their case. Further, pursuant to sections 102 and 103 of the Evidence Act 1950, the evidential burden is borne by the party who alleges a fact. Hence, the party who alleges that fact must prove it. If that party fails to discharge the burden of proving that fact, the onus of proof does not shift to the other party to disprove something which has not been proved against him.

(See the Federal Court cases of International Times & Ors v Leong Ho Yuen [1980] 2 MLJ 86; Letchumanan Chettiar Alagappan @ L Allagappan (as executor to SL Alameloo Achi alias Sona Lena Alamelo Acho, deceased) & Anor v Secure Plantation Sdn Bhd [2017] 5 CLJ 418; [2017] 4 MLJ 697; the Court of Appeal case of Hicom Tan & Tan Sdn Bhd v Seri Hijauan Joint Management Body [2014] 6 MLJ 739).

Given that the Plaintiffs allege breaches of the Collaboration Agreement on the part of the Defendants, the legal and evidential burden rests upon the Plaintiffs to establish such breaches and the losses flowing therefrom. statement of claim advanced claims under two main heads :

(a) under clauses 3A.1, 5.2, 5.4 and 5.6 of the Collaboration Agreement, debts owed by the Defendants under invoices amounting to RM 732,857.13 ( first head of claim ); and

(b) under Part A of Annexure 1 (future earnings guarantee), losses suffered , comprising :- (i) RM 1,799,563.30; and (ii) RM 22,386.27 second head of claim .

I dismissed the Defendants for the following reasons :

(a) In respect of the first head of claim, clause 3A.1 of the Collaboration Agreement does not require Samdo to pay the sum of RM 300,936.92 arising from the excluded assets as of right.

(b) This is because Clause 3A.2 of the Collaboration Agreement provides that such is only payable upon Samdo having received the proceeds, income, rentals and monies earned from the excluded assets.

(c) future earnings guarantee arising from the contracts listed in Part A of Annexure 1 (agreement / contract) in the sum of RM 105,018.43 under clause 5.4 of the Collaboration Agreement as well as Part B of Annexure 1 (asset) in the sum of RM 236,541.42 under clause 5.6 of the Collaboration Agreement (new contract earnings), are only payable upon Samdo having received the proceeds, income, rentals and monies earned from the aforesaid contracts.

(d) Prior to the Unconditional Date, all the existing earnings belong to Samdo. After the Unconditional Date, all the future earnings belong to P1. The Unconditional Date is 14.6.2022, as agreed in the Supplemental Agreement.

(e) Based on the plain and ordinary meaning of the words contained in clauses 3A.2, 5.4 and 5.6 of the Collaboration Agreement, the Plaintiffs are only entitled to the proceeds, income, rentals and monies earned and received by Samdo from the customers.

(f) P1 can be claimed under clauses 3A.1, 5.4 and 5.6 of the Collaboration Agreement is misconceived. When P1 bought the business and assets from Samdo, it was agreed that monies earned prior to the Unconditional Date from the excluded assets belong to Samdo. P1 shall be entitled to future earnings after the Unconditional Date from the list of contracts in Part A Annexure 1 of the Collaboration Agreement.

(g) For future earnings from the excluded assets, P1 is only entitled to the when monies are earned and received by Samdo and not otherwise following clauses 3A.1 and 3A.2.

(h) P1 entitlement will not materialise without the following conditions being satisfied :- (i) Firstly, proceeds, income, rentals and monies are earned from the customers; and (ii) Secondly, they are received by Samdo.

(i) Here, the Plaintiffs have failed to adduce sufficient evidence to prove the above two conditions. Thus, in the absence of any credible evidence to show the same, the claim for RM 300,936.92 cannot succeed.

(j) As far as the invoices are concerned, both PW1 (director of P) and PW2 (financial controller of P) testified that all the invoices were from P1 only and none from the customers. No evidence was led to show that Samdo had indeed received such proceeds, income, rentals and monies arising from the business and assets.

(k) When PW1 was questioned on whether there were any invoices to Mestron and Edotco, he confirmed that the invoices from P1 were only issued to Samdo for services purportedly rendered by P1 to Mestron and Edotco.

(l) As for the second head of claim, the Plaintiffs own witness PW2 had repeatedly agreed and confirmed that the Plaintiffs did not have sufficient evidence to prove its claim for the sum of RM 1,799,563.30.

(m) In any event, the Plaintiffs have failed to substantiate its claims as stipulated under the Collaboration Agreement. No proof of payment received by Samdo under the excluded assets, Part A of Annexure 1 (agreement / contract), Part B of Annexure 1 (asset) nor any evidence to show the existence of the new contracts was tendered.

(n) In the premises, the Plaintiffs have failed to discharge their burden of proving their claim, as there is no supporting document to explain the breakdown of the losses allegedly suffered by the Plaintiffs.

At the outset, it is germane to note that although PW1 (director of P) and PW2 (financial controller of P) testified for the Plaintiffs, PW1 repeatedly conceded under cross - examination that he was unable to to explain them, instead deferring to PW2.

In the circumstances, I consider is of limited probative value. His testimony should be accorded little weight in determining whether the Plaintiffs have discharged their burden of proving their claim. I. Debts due and owing under invoices (RM 732,857.13)

In respect of the first head of claim, PW2 testified that the sum of RM 732,857.13 comprised of debts arising from invoices issued by P1 to Samdo, together with related business transaction documents. I will examine each component of this claim. Before doing so, it is noteworthy that PW2 conceded that although P1 had issued various invoices to Samdo, Samdo had not, in fact, rendered any services to P1.

(a) Debt to Mestron for the Solar hybrid project (as of 7.7.2022 : RM 105,018.43)

In respect of the sum of RM 105,018.43 being debt to Mestron for the Solar hybrid project Invoice No. 2022 / 07 / Inv 00001 dated 8.7.2022 to Samdo, prepared

When questioned on the basis of this figure, PW2 stated that it was [sic] to Samdo . PW2 however conceded that there was no documentary evidence from Mestron to substantiate that this sum was due and owing. PW1 likewise was unable to confirm the existence of any supporting documentation.

In the absence of supporting documents evidencing any indebtedness by Samdo to Mestron, or any liability owed by Samdo to P1, the Plaintiffs have failed to discharge their burden of proof in respect of this claim.

(b) Profit sharing (as of 7.7.2022 : RM 87,555.80)

In respect of the profit sharing claim of RM 87,555.80, PW2 testified that it was documentary evidence apart from the invoice.

(c) Profit guarantee deficiency - Sacofa solar hybrid site (as of 7.7.2022 : RM 2,534)

In respect of the claim for RM 2,534 being profit guarantee deficiency for the Sacofa solar hybrid site, PW2 confirmed that no documentation existed to support such a claim.

(d) Rental - Sacofa hybrid site (RM 270.56)

In respect of the claim for RM 270.56 being rental for the Sacofa solar hybrid site, PW2 confirmed that there is no documentation to support such a claim, apart from the invoice. PW2 initially accepted under cross - examination that there was no basis upon which the court could verify or link the claims under the future earnings guarantee, specifically contracts under Part A of Annexure 1. PW2 subsequently changed his position by disagreeing. However, PW2 did not provide any cogent explanation for his change of stance.

In the circumstances, the Plaintiffs have failed to establish, by credible evidence, that Samdo is liable to P1 in respect of these claims under the future earnings guarantee.

The Plaintiffs further advanced claims under clause 5.6 of the Collaboration Agreement. For a claim to be sustainable under clause 5.6 of the Collaboration Agreement, the Plaintiffs must establish:- (a) the new c

(b) that Samdo received proceeds, income, rentals and monies derived from such new contracts.

However, the Plaintiffs have failed to adduce any evidence to new c clause 5.6 of the Collaboration Agreement. The Plaintiffs have also failed to call witnesses of the new c to give evidence or produce documents. Further, even if the purported new c statements, remittance advices, audited accounts or third - party confirmations to demonstrate that Samdo new contract e

PW2 conceded under cross - examination that he was unable to identify any specific new contract which gave rise to the sums claimed under clause 5.6 of the Collaboration Agreement. Neither was he able to verify whether Samdo had received any proceeds attributable to such new c In the absence of proof of both the existence of ew contracts and receipt of earnings by Samdo laim under clause 5.6 is not sustainable.

(e) Rentals for hybrid solar tower received by Samdo (RM 108,468.69)

In respect of the claim for RM 108,468.69 being rentals for hybrid solar tower received by Samdo, PW2 testified that the existence of the contracts referred to for such claim is contained in one contract, a Purchase Order No. : PO 027989 - 1. However, under cross - examination, PW2 conceded that the purchase order referred to does not correspond to the claim being made. In this regard, when asked to confirm the period for which the claim is being made, PW2 stated that it was from October 2022 to May 2023. However, PW2 agreed that the purchase order would only last until the end of July 2020. He further agreed that there is no proof that Samdo had received the sum of RM 108,468.69 from Edotco.

(f) Monies received by Samdo from ZTE - DIGI (RM 44,316.03)

Similarly, in respect of the claim for RM 44,316.03 being monies received by Samdo from ZTE - DIGI, PW2 confirmed that there is no contract between ZTE - DIGI and Samdo. Further, there is no proof that Samdo received the sum of RM 44,316.03 from ZTE - DIGI.

(g) Monies received by Samdo from Binasat (RM 79,796.70)

In respect of the claim for RM 79,796.70 being monies received by Samdo from Binasat, whilst there appears to be a purchase order, there was no proof of payment by Binasat. Rendering it a case where insufficient proof was produced by P1 to justify this claim for RM 79,796.70.

(h) Monies received by Samdo from Ericsson - Digital National Broadband (RM 3,960)

In respect of the claim for RM 3,960 being monies received by Samdo from Ericsson - Digital National Broadband, while it appears that there was a purchase order, there was no corresponding invoice by Samdo. Neither was there proof that Samdo received the sum of RM 3,960 from Ericsson - Digital National Broadband. II. Losses suffered by the Plaintiffs (RM 1,799,563.30)

(a) Loss of rental income due to non - performing towers (RM 850,224.35)

PW2 testified that in respect of the non - performing towers, the sum of RM 850,244.35 comprised of :

(i) non - functioning Edotco sites : sites not functioning (rental income - Edotco has taken repossession of sites, 375,401.61;

(i) Non - functioning Edotco sites (RM 375,401.61)

PW2 relied on a Purchase Order No. : PO 027989 - 1 to show the existence of rental arrangement for the sites claimed by the Plaintiffs. However, under cross - examination, PW2 conceded that the said purchase order had expired and did not cover the claimed period from May 2023 to July 2023. He further admitted that there was no other contract or purchase o

Even if assuming the existence of any rental arrangement, there was no proof to support the claim that these Edotco sites were non - . In any event, the contents of the board minutes are hearsay.

With respect to the purported five under - performing Edotco sites, PW2 conceded that these sites also fell outside of the period of the purchase order. There were no other contracts or purchase orders

PW2 relied on spreadsheets at page 485 to 486 of the Common Bundle of Documents in Bundle B1 to support his allegation that these Edotco sites were under - performing. However, he admitted that the knowledge of its contents. As such, these documents are hearsay and inadmissible to prove the contents of the spreadsheets. In the premises, I find above pertaining to the Edotco sites are unsubstantiated.

I am guided by the Supreme Court case of KPM Khidmat Sdn Bhd v Tey Kim Suie [1994] 2 MLJ 627. Which held that if the primary evidence or the source from which the statement of account is produced is not produced in court as evidence, then that statement of account is inadmissible. The Supreme Court said (at page 633 - 634) : below did not dispute the contents of the summary of accounts (at pp 117 - 121 of the appeal record). The learned judge held that as the appellant did not challenge the truth of the summary of accounts, he was of the view that the contents were true and admissible despite the fact that the appellant never agreed to dispense with formal proof of the debt. On this issue, we were referred by counsel to the decision of Edgar Joseph Jr J in Popular Industries Ltd v Eastern Garment Manufacturing Sdn Bhd [1989] 3 MLJ 360. The learned judge addressed the issue in the following manner (at p 368) : Now, it was alleged by the plaintiffs that both the oral testimony of the accountant Mr So (regarding their financial operations) and the statement P76 prepared by him, were based upon the results of his examination of the accounts books of the plaintiffs for the relevant period. However, the accounts books themselves were never produced and the defendants never dispensed with formal proof of the loss of profits alleged or at all. In my opinion, the result of this glaring omission, was to render such oral evidence of Mr So and P76 inadmissible in evidence and it makes not the slightest difference that Mr and Mrs Segal confirmed the accuracy of P76. I take the law on this point to be correctly stated by the Vice - Chancellor in Johnson v Kershaw 63 ER 1059. In that case, the evidence of an accountant was tendered containing the results of his examination of certain partnership books, but the accounts books themselves upon which he based his statement were not in evidence. The Vice - Chancellor said : If the account books had been in evidence, the accountant s statement of the results of his examination of those books, as the evidence of a person of skill, might be receivable; but, inasmuch as the books were not in evidence, I must decline to receive the deposition of Mr Peet as to their contents. We would adopt with gratitude the above statement of the law to the present case. Looking at the matter as a whole, we have come to the conclusion that the learned judicial commissioner was wrong in relying on the summary of accounts (at pp 117 - 121 of the appeal record) as sufficient proof of the debt due to the respondent bearing in mind that the burden of proof always lies on the respondent to prove his claim. We hasten to add that since the summary of accounts is inadmissible for reasons which we have adverted to above, it is our further conclusion that as there is no documentary evidence before the court which the respondent can rely to substantiate his claim, his case

In respect of the rental income for the Sacofa sites, PW2 testified that the claim covered the period from 17.1.2024 until 20.7.2026, which was However, PW2 conceded that there was no proof of acceptance by Samdo for the purchase order. He further conceded that, in any event, the purchase order did not cover the claimed period.

PW2 further relied on a table allegedly provided by Mestron (at page 488 of the Common Bundle of Documents in Bundle B1) to substantiate However, PW2 did not prepare the table. Neither was that table confirmation of an agreement. PW2 conceded that he had no personal knowledge of the contents in the said table. As such, this claim is unsupported.

(b) Profit guarantee to Mestron (RM 156,675)

(i) Under - performing Edotco sites (profit guarantee from 8.7.2022 until end of tenancy period : RM 128,741.67)

When cross-examined to show the rental agreement for the five Edotco sites claimed as under - performing sites, PW2 answered in a manner inconsistent with his agreement just a day prior. Where he conceded that no supporting documents existed. PW2 contradicted his previous testimony by asserting that the sites were provided under the Collaboration Agreement and by Edotco.

Under cross - examination to show how the sites under the Collaboration Agreement are linked to Edotco, PW2 referred to the purchase order and made reference to the sites and their reference numbers therein. However, under further cross - examination, PW2 admitted that six of the seven site reference numbers were not found in Part B of Annexure 1 (asset) of the Collaboration Agreement.

In view of the absence of any documentary evidence to show the self - serving testimony, I consider ies little weight. (See the Court of Appeal case of Superintendent of Lands & Surveys, Bintulu v Nor Anak Nyawai & Ors and another appeal [2005] 3

In any event, PW2 agreed that the purchase order period does not correspond with the claims. And that the Plaintiffs could have but did not produce the purchase orders for the period claimed. The Plaintiffs have failed to call any witnesses from Mestron or to produce any documentary evidence.

In the same vein, even if there were valid and subsisting contracts for these sites, there was no evidence to support that these sites were under - performing. In fact, PW2 agreed that the only documentary evidence which purports to support such a claim was information from Edotco. However, such information was not prepared by him and he had no personal knowledge of the information. Crucially, Edotco was not called to testify to the fact. In the circumstances, the Plaintiffs have failed to establish the basis of its claim.

In respect of this claim, PW2 previously conceded that no rental agreement subsisted. However in an about turn, PW2 changed tune from his previous day testimony and disagreed that there was no documentary Nevertheless change in position is unsupported by evidence and this claim similarly must fail.

(c) Profit guarantee to the 1st Plaintiff (RM 156,975)

These claims mirror those made in respect of Mestron. PW2 agreed that the same questions and issues were posed and answered to PW2, but this particular claim relates to the profit guarantee due to P1.

Here again, PW2 contradicted his earlier testimony. I consider that renders the claim unsubstantiated.

(i) Under - performing Edotco sites (profit guarantee from 8.7.2022 until end of tenancy period : RM 128,741.67)

128,741.67, contrary to what he testified only a day before. I consider that . This claim therefore fails.

PW2 disagrees that there is no 28,233.33. Nevertheless, the truth is that there is no evidence to support such a claim.

(d) Costs overrun incurred by the Plaintiffs

(i) Under - performing Edotco sites (RM 621,736.61)

PW2 asserts that Samdo is liable to pay the Plaintiffs a sum of RM 621,736.61, being the costs overrun incurred by the Plaintiffs. He relied on the management accounts found at pages 4 and 5 of the Common Bundle of Documents in Bundle C2.

However, PW2 conceded under cross - examination that the management accounts are mere summaries and do not prove actual payments or expenditure. He further agreed there were no supporting documents to show what was incurred or was paid out. Accordingly, this claim is unsubstantiated.

Similarly, PW2 asserts that the claim for RM 13,652.64 is based on the management accounts found at pages 4 and 5 of the Common Bundle of Documents in Bundle C2. This claim, likewise, must fail. III. Losses suffered by the Plaintiffs - rental for the Sacofa hybrid site

PW2 conceded that no rental agreement existed. This claim is therefore unsubstantiated. Conclusion in respect of the P

In summary, the Plaintiffs have failed to discharge their burden of proving breach, loss and causation. is founded on :-

(a) contracts which are non - existent, or at least not produced; (b) hearsay evidence or documents;

(c) internal spreadsheets based on unsubstantiated contents; and (d) contradictory testimony. The Plaintiffs failed to produce witnesses with personal knowledge, direct evidence or documents to substantiate their claim.

It is apparent that no credible documentary or testimonial foundation must be dismissed.

Before moving on to the Defendants address Samdo had breached the Collaboration Agreement by failing to cease its business. Such allegation is contradicted by P1 1 had continued to issue invoices to Samdo, thus preventing Samdo from ceasing business.

In response to the suggestion put forth by Mani that the invoices should be issued to Mestron or Edotco after the novation, PW1 stated that P1 did do so. However no evidence of any such invoices was presented to the court. that the invoices issued by P1 to Samdo were generated by P1 for its own accounting purposes. Mani explained the reason why P1 issued the invoices to Samdo was not for the purpose for confirming any debt owed by Samdo to P1. Notably, Mani was a director of Samdo as well as a director of P1 at the material time. He confirmed during cross - examination that Samdo was a dormant company with no transaction.

PW1 testified that he was not aware that the Network Facilities Provider licence is non - transferable. Be that as it may, section 36 of the Communications and Multimedia Act 1998 stipulates that the licence is personal to the licensee and cannot be assigned or transferred to any other party unless the prior written approval of the Minister has been granted. No such approval was obtained. Accordingly, the Plaintiffs claim for the Network Facilities Provide licence is untenable. Samdo - the 1st Plaintiff Samdo RM 1,142,635.90 and RM 400,000

The evidence shows that P1 have failed to pay Samdo the full purchase consideration under the Collaboration Agreement. Under clause 3.1 of the Collaboration Agreement, the total purchase consideration for the sale of business and assets by Samdo to P1 was RM 2,342,635.90, payable as follows :

(a) RM 100,000 (forming part of the advanced monies of RM 400,000), to be treated as part payment;

(b) RM 1,142,635.90, payable on the Unconditional Date; and

(c) RM 1,100,000 payable on the Completion Date.

Clause 4 of the Supplemental Agreement subsequently varied the manner of payment of RM 1,100,000.00 such that :

(a) RM 700,000 was payable on the Completion Date; and

(b) RM 400,000 was payable on the Completion Date or Compliance Date, whichever was later.

It is undisputed that RM 700,000 was paid to Samdo. The dispute concerns the non - payment of RM 1,142,635.90 and RM 400,000.

(a) Failure of the 1st Plaintiff to pay Samdo RM 1,142,635.90

The evidence establishes that P1 failed to pay Samdo the sum of RM 1,142,635.90, whether on the Unconditional Date or otherwise. PW1 statement of account at page 221 of the Common Bundle of Documents at Bundle B1 as proof of payment. However, no bank records, remittance advice or independent confirmation show that this sum was credited to Samdo. statement of account does not reflect any such transfer.

The burden of proving payments rests on P1, which P1 failed to discharge. This stands in contrast to the RM 700,000 payment, which is statement of account found at page 223 of the Common Bundle of Documents at Bundle B1. The irresistible inference is that, in fact, RM 1,142,645.90 was never paid to Samdo.

(b) Failure of the 1st Plaintiff to pay Samdo RM 400,000

It is not in dispute that P1 shall pay Samdo RM 400,000 on the Completion Date or the Compliance Date, whichever is later. The critical issue is therefore the determination of the Compliance Date.

At Q&A 8 of PW1 prior to its amendment, the Plaintiffs took the position that the Compliance Date arose upon the execution of the Mestron Deed of Novation on 26.5.2023, resulting in a Compliance Date of 13.6.2023. On the eve of trial, the position was contracts in Part A of Appendix 1 of the Collaboration Agreement have not

case, which refers only to the Mestron Deed of Novation. No reference was made in the pleadings to any other alleged outstanding novation.

It is trite that parties are bound by their pleadings and may not advance issues that were not pleaded at trial. (See the Federal Court cases of Samuel Naik Siang Ting v Public Bank Bhd [2015] 6 MLJ 1; Iftikar Ahmed Khan (as the executor of the estate for Sardar Mohd Roshan Khan, deceased) v Perwira Affin Bank Bhd (previously known as Perwira Habib Bank Malaysia Bhd) [2018] 2 MLJ 292). new factual issues at trial is impermissible and must be rejected.

(pre - amendment), the only relevant novation agreement is the Mestron Deed of Novation. As this was executed on 26.5.2023, the Compliance Date fell on 13.6.2023. Accordingly, P1 became contractually obliged to pay RM 400,000.00 to Samdo thereafter. However, no evidence of payment has been produced. P1, therefore, is in breach and liable to Samdo for this sum. Samdo - RM 1,429,824.86 being the alleged assets of Samdo

In respect of the alleged claim of RM 1,429,824.86 purportedly being the alleged assets of Samdo, it is unclear what this head of claim is premised on. The Collaboration Agreement only provides that P1 is required to pay the purchase price of RM 2,342.635.90 upon fulfilment of the condition precedent by the Defendants and Elemen Dimensi. From the express terms of the Collaboration Agreement, P1 is not contractually obligated to pay this sum to Samdo.

Further, the Defendants led no evidence on this head of claim against the Plaintiffs during the trial. Failure to cross - examine on a particular issue may be treated as abandonment of such issue. (See the Court of Appeal case of Aik Ming (M) Sdn Bhd & Ors v Chang Ching Chuen & Ors and another appeal [1995] 2 MLJ 770). N r counsels have put this issue to PW1 and PW2 when they were cross - examined. Thus, the Defendants must be treated to have abandoned this claim as no evidence was led during the trial. I therefore dismissed the Defendants 1,429,824.86 against the Plaintiffs. Manis - monthly salary of RM 20,000

The monthly salary of RM 20,000 claimed by Mani, calculated from the date of his alleged termination until full payment of the said sum, is unsustainable. Such claim should have been brought in the Industrial Court, which is the proper forum for enforcement of rights regarding employment. (See the Court of Appeal case of 7 - Eleven Malaysia Sdn Bhd v Ashvine Hari Krishnan [2023] 3 MLJ 469; the High Court case of Polyflo Sdn Bhd v Koh Kok Quiee @ Koh Yok Chow [2024] MLJU 3500). Manis - Loss of income of RM 6,534,000 from the Edotco contract

During the trial, Mani confirmed that he has abandoned this head of claim for loss of income of RM 6,534,000 pertaining to the Edotco contract. Mani - Rights issue of share

In the Defendants defence and counterclaim, this is what they have pleaded - salah oleh Defendan Kedua

Based on the pleadings, the Defendants prayed for a declaration that the rights issue of share was unlawful carried out by Mani. No wrongdoing is attributed to the Plaintiffs.

remain unchallenged as the Defendants did not put any questions to PW1 to challenge the validity of the rights issue. The question put to PW1 during cross - s why the share price per unit is at RM 0.01 instead of RM 0.99. PW1 in re - examination explained that the share unit price was voted and approved by the Board, including Mani. It was Mani who failed to subscribe for the shares, despite extension of time being given to him.

Based on the testimony of PW1, it is apparent that the allegation of conspiracy between the Plaintiffs and Elemen Dimensi holds no water. The rights issue of shares was carried out properly by the Board of P1. P1 conspired with Elemen Dimensi because P1 failed to assist him in the subscription of the rights issue is baseless. Under section 123 of the Companies Act 2016, a company is prohibited from giving financial assistance in connection with a purchase of its own shares.

declaration that the rights issue of share was unlawful is without merit.

Given that unsuccessful, the question of Mani having to indemnify Samdo against Be that as it may, for completeness, I dismissed S asons.

Samdo confirmed that it is not seeking indemnity under the share sale and purchase agreement. This is because Samdo is not a party to the share sale and purchase agreement between Mani and the new shareholders. Samdo therefore cannot and does not rely on the share sale and purchase agreement. premised on the allegation that Mani breached his fiduciary duties owed to Samdo. In that :

(a) Mani entered into the Collaboration Agreement for his own personal benefit;

(b) Mani failed to disclose his direct and material interest in P1 as a shareholder and director thereafter;

(c) Mani failed to declare the benefit or interests arising from the Collaboration Agreement;

(d) the Collaboration Agreement was not in the best interests of Samdo, as its effect was to prevent Samdo from conducting business; and

(e) the effect of the Collaboration Agreement was that Samdo was effectively deprived of its business, as the Collaboration Agreement resulted in the transfer of Samdo .

It is my finding that Samdo has failed to prove any breach of fiduciary duty on the part of Mani.

(a) The sole witness for Samdo (DW1) confirmed in his testimony that he has no legal connection with Samdo. He is neither a director nor a shareholder of Samdo. The main character who had dealt with Mani is Mark. However, Mark was not called as a witness to rebut the assertions made by Mani, although he was the material witness for Samdo.

(b) Interestingly, during the pre - trial case management, Samdo had filed a list of witness which listed Mark as its witness. Samdo even filed a witness statement by Mark. Nevertheless, Mark did not attend court to testify during the trial. Instead, DW1 stood in as a last minute replacement. His witness statement, which was statement. However, DW1 is hearsay.

(c) DW3, the former company secretary of Samdo, was subpoenaed by Mani to give evidence. DW3 evidence is relevant, as he was responsible for Samdo book and resolutions when the Collaboration Agreement was entered.

(d) Samdo failed to rebut Mani and DW3 evidence that the execution of the Collaboration Agreement was in order and duly approved by the shareholders at that material time. The Collaboration Agreement was duly approved by the shareholders of Samdo at the material time, in line with the commercial decision of the board at that material time. With the relevant board approval, the business of Samdo was sold to P1 through the Collaboration Agreement.

(e) Mani has proved on a balance of probabilities that Samdo and Mark at that material time had knowledge regarding the interest of the parties in the Collaboration Agreement. Prior to Mark and his Bumiputera nominees taking over the shares in Samdo, Mani had informed them of the sale of the business and assets of Samdo through the Collaboration Agreement to P1.

(f) Coupled with the conduct of Samdo in retaining Mani as its director after the completion of the share sale and purchase agreement as well as allowing Mani to appoint lawyers to defend the present suit, also points to the opposite of any misrepresentation or breach of fiduciary conduct.

(g) Samdo has failed to establish that Mani entered into the Collaboration Agreement for his own personal benefit. The evidence demonstrates that it was Samdo who stood to receive the purchase price under the Collaboration Agreement. The transaction was actually detrimental to Mani, who was required to furnish a personal guarantee for the benefit of Samdo (to receive consideration sum).

(h) From the evidence that was adduced, Samdo has failed to prove that Mani was in breach of his fiduciary duties to Samdo. Conclusion

I conclude that :

(a) The Plaintiffs have failed to discharge the burden of establishing their claims against the Defendants, in that :

(i) The Plaintiffs have failed to establish that the Defendants breached the terms of the Collaboration Agreement; and

(b) The Plaintiffs have failed to pay to Samdo the sums of RM 1,142,635.90 and RM 400,000 due under the Collaboration Agreement.

For the reasons above, I dismissed t against the Defendants. I allowed Samdo 1,142,635.90 and RM 400,000 against P1. Mani.

I ordered the Plaintiffs to pay costs of RM 30,000 to Samdo and RM 20,000 to Mani in respect of the dismissal of its claim against the Defendants. I ordered Samdo to pay costs of RM 20,000 to Mani in respect of the dismissal of its indemnity claim against Mani. Dated 9 March 2026 Quay Chew Soon Judge High Court of Kuala Lumpur (Commercial Division NCC 2) Counsels John Wong Yok Hon and Chong Kah Yee (Messrs. Shui Tai) for the Plaintiffs Sean Tan Tee Li, Muhammad Anas bin Md Abdul Rashid and Lock Jun Qi (Messrs. Tang Hong & Lock) for the 1st Defendant Palanivel a/l K. V. Sathasivam and Siow Chang Yao (Messrs. Palani Aishah & Co.) for the 2nd Defendant Case reference 1. International Times & Ors v Leong Ho Yuen [1980] 2 MLJ 86 2. Letchumanan Chettiar Alagappan @ L Allagappan (as executor to SL Alameloo Achi alias Sona Lena Alamelo Acho, deceased) & Anor v Secure Plantation Sdn Bhd [2017] 5 CLJ 418; [2017] 4 MLJ 697 3. Hicom Tan & Tan Sdn Bhd v Seri Hijauan Joint Management Body [2014] 6 MLJ 739 4. KPM Khidmat Sdn Bhd v Tey Kim Suie [1994] 2 MLJ 627 5. Superintendent of Lands & Surveys, Bintulu v Nor Anak Nyawai & Ors and another appeal [2005] 3 CLJ 555 6. Samuel Naik Siang Ting v Public Bank Bhd [2015] 6 MLJ 1 7. Iftikar Ahmed Khan (as the executor of the estate for Sardar Mohd Roshan Khan, deceased) v Perwira Affin Bank Bhd (previously known as Perwira Habib Bank Malaysia Bhd) [2018] 2 MLJ 292 8. Aik Ming (M) Sdn Bhd & Ors v Chang Ching Chuen & Ors and another appeal [1995] 2 MLJ 770 9. 7 - Eleven Malaysia Sdn Bhd v Ashvine Hari Krishnan [2023] 3 MLJ 469 10. Polyflo Sdn Bhd v Koh Kok Quiee @ Koh Yok Chow [2024] MLJU 3500 Legislation reference 1. Sections 123 and 218 (1) of the Companies Act 2016 2. Section 101, 102 and 103 of the Evidence Act 1950 3. Section 36 of the Communications and Multimedia Act 1998