1. ) Dato' Sri Zul Azmi Bin Abu Hussin v Dato' Ahmad Faris Bin Abdul Halim (WA-22NCvC-180-04/2023)

DATO’ SRI ZUL AZMI BIN ABU HUSSIN (NO. K/P: 751221-04-5171) …PLAINTIF PERTAMA

XSPEC RESOURCES SDN BHD (NO. SYARIKAT: 904738-H) …PLAINTIF KEDUA DAN DATO’ AHMAD FARIS BIN ABDUL HALIM (NO. K/P: 640707-08-6473) …DEFENDAN (Dalam Tindakan Asal) DAN ANTARA DATO’ AHMAD FARIS BIN ABDUL HALIM (NO. K/P: 640707-08-6473) …PLAINTIF DAN 1. DATO’ SRI ZUL AZMI BIN ABU HUSSIN

MUZZAM TEKNOLOGI (M) SDN BHD

ISQ CLASSIC ENTERPRISE (NO. SYARIKAT: 202103294297 (IP0563147-K)) 14/08/2025 11:53:08 WA-22NCvC-180-04/2023 Kand. 85 S/N 0Gu7XjMsakukwbqloozEgQ GUAMAN NO.: WA-22NCvC-180-04/2023 4. ISHAK BIN ABU BAKAR

MOHD ZAHARUDIN BIN HUSSAIN (NO. K/P: 751115-02-5599) … DEFENDAN-DEFENDAN GROUNDS OF JUDGMENT Introduction 1. The Defendant Dato’Ahmad Faris bin Abdul Halim is the original Defendant in this civil suit. He filed a Counterclaim against the 1st Plaintiff Dato’ Sri Zul Azmi bin Abu Hussin and 4 others in his counterclaim.

The Notice of Application before this court was filed by the Defendant (who is the plaintiff in the Counterclaim) against the Plaintiffs in the original action. It is for a Mareva injunction and a discovery order to compel the Plaintiffs to disclose details of money received from the Royal Police Force of Malaysia (“PDRM”)

Based on the undisputed facts of the case, I decided that this Court ought to issue a Mareva injunction as sought by the Defendant and also a discovery order in aid of execution of the Mareva injunction. Background Facts 4. Since the application is about the Defendant’s application for a Mareva injunction and a discovery order to compel the Plaintiffs to disclose details of money received from the Royal Police Force of S/N 0Gu7XjMsakukwbqloozEgQ Malaysia (“PDRM”) pursuant to a contract, I shall set out only the salient facts for determination of the Defendant’s said application.

The 2nd Plaintiff XSPEC Resources Sdn Bhd is a company in which the 1st Plaintiff was, as the material time, a director and sole shareholder.

On 7th February 2019, the 2nd Plaintiff XSPEC Resources Sdn Bhd was awarded a contract (“the said Contract”) by PDRM vide a letter of award issued by the Deputy Director of the Special Branch Division of PDRM. Pursuant to the said Contract, the 2nd Plaintiff was to procure and supply technical equipment for the operation of the Special Branch Division in Bukit Aman (“the Project”) for a period of three years between 7th February 2019 and 6th February 2022. As no details were pleaded regarding the technical equipment that cost RM53,000,000.00 – presumably because the details must be kept confidential under wraps – one can imagine the equipment to be some highly advanced ones, like those seen only in James Bond 007 movies.

After the 1st Plaintiff had secured the award of the said Contract for the 2nd Plaintiff, he approached Malaysia Debt Ventures Berhad (“MDVB”) to seek financing to perform the said Contract. Regardlessof whether it was true or not that the 1st Plaintiff was unable to secure a loan for the 2nd Plaintiff based on his own efforts, the undisputed fact is that he approached the Defendant for financial assistance. S/N 0Gu7XjMsakukwbqloozEgQ GUAMAN NO.: WA-22NCvC-180-04/2023 8. Negotiation between the 1st Plaintiff and the Defendant culminated in a Deed of Trust dated 28th August 2020 (“the said Deed of Trust”) being drafted and signed to record their terms of agreement.

In the said Deed of Trust, the 1st Plaintiff declared himself trustee for the Defendant for 196,000 shares in the 2nd Plaintiff – which was equivalent to 70% equity. In consideration thereof, the Defendant advanced money for the 2nd Plaintiff to start working on the Project and also undertook to assist the 2nd Plaintiff in obtaining financing from MDVB.

On 8th September 2021, MDVB approved the 2nd Plaintiff’s application for a loan of RM28,150,000.00 (‘the said Loan”).

Armed with funds from the Defendant and the said Loan, the 2nd Plaintiff was able to complete the Project in early 2022. PDRM then paid out RM37,100,000.00 to the 2nd Plaintiff under the said Contract. The Defendant’s Application for a Mareva Injunction & Discovery 12. The Defendant avers that he had expected money received by the 2nd Plaintiff from PDRM to be utilised first to pay MDVB, i.e. to pay off the said Loan. However, he found out that out of the RM37,100,000.00, received by the 2nd Plaintiff from PDRM, RM33,802,237.33 was paid to ISQ Classic Enterprise (the 3rd Defendant in his Counterclaim) while a sum of RM 3,297,762.67 was S/N 0Gu7XjMsakukwbqloozEgQ paid over to Muzzam Teknologi (M) Sdn Bhd (the 2nd Defendant in his Counterclaim).

The Defendant also avers that the 1st Plaintiff deferred payment due by the 2nd Plaintiff to MDVB on 11th and 28th February 2022 respectively, allegedly because the 1st Plaintiff wanted to utilise the money received from PDRM to secure two new contracts.

On 20th April 2022, the Defendant filed a police report. The Police were swift in issuing an order to freeze the 1st Plaintiff’s bank accounts pursuant to Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (“AMLA”).

Due to non-payment of the said Loan, in late 2022, MDVB sued and obtained summary judgment jointly and severally against both Plaintiffs and the Defendant who had signed a personal guarantee to guarantee the 2nd Plaintiff’s legal obligations.

On 1st March 2023, the Defendant’s solicitors attempted to seek details of the accounts frozen by the Police but were unsuccessful without a court order. He could only obtain confirmation that there was an investigation. He subsequently discovered that the Attorney-General’s Chambers had deferred taking further action against the 1st Plaintiff. The Defendant then decided to file this civil suit, which was followed by the said Notice of Application on 1st October 2024 to seek a Mareva injunction and a discovery order. A Certificate of Urgency was filed by solicitors for the Defendant to seek an early S/N 0Gu7XjMsakukwbqloozEgQ hearing date. The Defendant’s Notice of Application was amended, with leave, to correct some errors.

On 4th October 2024, the Defendant’s Amended Notice of Application (Enclosure 63) was fixed for ex-parte hearing in this Court (NCvC 9) instead of in High Court at Kuala Lumpur NCvC 10 (where it is docketed) because the Bench of NCvC 10 was, and is still vacant. After hearing, I decided that this Court ought to grant an interlocutory Mareva injunction pending inter-parte hearing of the Defendant’s said application. The Plaintiffs’ Position 18. The Plaintiffs have initiated this civil suit to declare the said Deed of Trust as void and revocable for want of consideration. In essence, the 1st Plaintiff is contending that he does not hold the 196,000 shares in the 2nd Plaintiff company as trustee for the Defendant.

The 1st Plaintiff further avers that the personal loans given by the Defendant, which was allegedly about RM1.8 million, had been repaid to the Defendant with interest. Analysis of the Law and Facts 20. The most oft-quoted passages on the legal principles applicable to the issuance of an interim injunction in Malaysia are from the judgment of the Court of Appeal in Keet Gerald Francis Noel John v. Mohd Noor @ Harun Abdullah [1995] 1 CLJ 293. Therein, guidance on the general inquiry to be undertaken when hearing an interlocutory injunction application, was worded as follows: S/N 0Gu7XjMsakukwbqloozEgQ “[3] A Judge hearing an application for an interlocutory injunction should undertake an inquiry along the following lines:

firstly, he must ask himself whether the totality of the facts presented before him discloses a bona fide serious issue to be tried;

having found that an issue has been disclosed that requires further investigation, he must consider where the justice of the case lies. In making his assessment, he must take into account all relevant matters, including the practical realities of the case;

the Judge must have in the forefront of his mind that the remedy that he is asked to administer is discretionary, intended to produce a just result for the period between the date of the application and the trial proper and intended to maintain the status quo.”

In the enforcement of criminal law, there are statutes that specifically empower the Police and enforcement agencies to restrain the dissipation of assets pending investigation, for example, by ordering bank accounts to be frozen and entering a registrar’s caveat to prohibit the registration of transfer of real properties. As for civil cases, the court may issue a Mareva injunction which restrains a defendant from taking any steps that would result in the dissipation of his assets pending the disposal of a civil suit, or until further order, as the case may be.

As a matter of fact, Mareva injunctions are not something new in Malaysia. Since it was first issued in England in Mareva Compania Naviera SA v. International Bulk Carriers [1980] 1 All ER 213 (the first case from where it acquired its name), our courts in Malaysia S/N 0Gu7XjMsakukwbqloozEgQ have been issuing similar injunctions. The Federal Court in Zainal Abidin bin Haji Abdul Rahman v. Century Hotel Sdn Bhd [1982] 1 MLJ 260 had held that the superior courts in Malaysia have the jurisdiction to issue this type of injunctions. That was reaffirmed by the Federal Court in S & F INTERNATIONAL LIMITED v. TRANS-CON ENGINEERING SDN BHD [1985] 1 MLJ 62 which described Mareva injunctions as: “a species of interlocutory injunction which restrains a defendant by himself or by his agents or servants or otherwise from removing from the jurisdiction or disposing of or dealing with those of his assets that will or may be necessary to meet a plaintiff's pending claim.”

The need to restrain a defendant early before judgment arises because if a defendant succeeds in dissipating his assets before final judgment could be entered against him, the plaintiff would ultimately be left with a ‘paper judgment’, i.e. a judgment not even worth the paper it is printed on. As could be seen from the standard wording of a Mareva injunction, its purpose is to restrain a defendant, who knows he has a weak defence, from dissipating his assets before a court could issue a final judgment against him.

In other words, a Mareva injunction is intended to cover the ‘gap period’ between the issuance of the injunction and the final disposal of the civil suit because court process inevitably takes time, especially when a trial with the calling of multiple witnesses is necessary. To borrow the analogy used by English judges: it is to shut the stable door before the horse has bolted. S/N 0Gu7XjMsakukwbqloozEgQ GUAMAN NO.: WA-22NCvC-180-04/2023 25. Even though third parties, including commercial banks where a defendant maintains his bank accounts, are not named as parties in a civil suit, they would freeze the defendant’s accounts when served with a copy of a Mareva injunction – so as to avoid assisting a defiant defendant from acting in violation of the prohibitory injunction.

As a Mareva injunction is a special species of interim prohibitory injunctions, there are special requirements to be met. The three essential requirements for the issuance of a Mareva injunction set out by the Supreme Court in Creative Furnishing Sdn Bhd v. Wong Koi [1989] 2 MLJ 153 were applied in Biasamas Sdn Bhd v. Kan Yang Heng [1998] 4 MLJ 1 by the Court of Appeal and a string of cases in Malaysia. Those three requirements could be summed up as follows: first, the plaintiff must be able to show a good arguable case, secondly, that the defendant has assets within the jurisdiction, and thirdly, that there is a real risk of the defendant’s assets being dissipated or removed out of the jurisdiction of this Court before judgment.

The first requirement of having to show a good arguable case was explained in detail by the Court of Appeal in Hock Hua Bank (Sabah) Bhd v. Yong Liuk Thin [1995] 2 MLJ 213 in an elucidating judgment. I can do no better than to quote the following passages:- “In the present case there is an added consideration. The appellants were, as I surmise, applying for a Mareva injunction. As such, the relative strength or weakness of the defence filed during the very early stages of the action is extremely relevant in assessing whether the plaintiff has an arguable case. It is a higher standard than that S/N 0Gu7XjMsakukwbqloozEgQ applicable to the usual application for an injunction. (See The Tatiangela [1980] 2 Lloyd's Rep 193.) That this ought to be so is not in the least surprising: for the allegation made is that there is a risk of the defendant dissipating his assets with a view to defeating any judgment that the plaintiff may obtain against him. Since the relief is postulated upon a plaintiff's success in the main action, for example, damages, it is only right and proper that the strength of his case be tested to ascertain how high the probabilities lie in favour of his ultimate success. The higher the degree of success, the greater is the need to protect that event by ensuring that he does not get a judgment that is as good as writ on running water. This, then, is the philosophy of the Mareva jurisdiction as distilled from the authorities upon the subject.” “When a judge comes to assess the strength of a plaintiff's case, it is a natural and essential part of that exercise to undertake an examination of the defences taken to the main action. The stronger the defence on its face, the less likely that the plaintiff will succeed in his action; and less the reason to grant him interim protection. To invert the proposition, the weaker the defence on its face, the greater is the probability of the plaintiff's success in getting his judgment. That in my view is the correct approach to be adopted.” “The court, when exercising the jurisdiction that is seised of, is required to conduct a balancing exercise in order to do justice to the parties. Imposing a restraint upon a man from dealing with what is prima facie his property is a very serious matter indeed. It is for that reason that equity requires the parties to submit their respective cases S/N 0Gu7XjMsakukwbqloozEgQ to a critical scrutiny by the court. In the end, it is a matter that depends upon the particular factual matrix that lies before the judge and upon his assessment of where the justice of the case lies.”

My analysis of the salient facts are as follows.

First, there is no doubt that it was the 1st Plaintiff who approached the Defendant for financial assistance because his company (the 2nd Plaintiff) had been awarded the Project by PDRM but lacked the funds to perform.

There is also no doubt that the 1st Plaintiff and the Defendant had entered into the said Deed of Trust to secure the Defendant’s interest. The Defendant could not have advanced his money and worked on procuring the said Loan from MDVB for the 2nd Plaintiff’s benefit if the 1st Plaintiff had offered him just a glass of ‘teh tarik’. On a balance of probabilities, I find that the Defendant did not ‘stick his neck out’ to be the 2nd Plaintiff’s guarantor for the said Loan out of altruism. For the avoidance of doubt, this Court is not making any ruling about the validity of the said Deed of Trust.

Bearing in mind that the Defendant is a guarantor for repayment of the said Loan by the 2nd Plaintiff, I find that the Defendant had every right to expect the money received by the 2nd Plaintiff from PDRM to be utilised first to pay MDVB, i.e. to pay off the said Loan. Further, it is trite that debts ought to be repaid. No authority is required for this fundamental point. Yet, instead of repaying the said Loan to MDVB forthwith, the 1st Plaintiff who controls the 2nd Plaintiff absolutely, had diverted RM33,802,237.33 to pay the 3rd Defendant (in the S/N 0Gu7XjMsakukwbqloozEgQ Counterclaim), i.e. ISQ Classic Enterprise, while a sum of RM 3,297,762.67 was paid to the 2nd Defendant (in the Counterclaim), i.e. Muzzam Teknologi (M) Sdn Bhd.

The 1st Plaintiff’s act of paying over the money received from PDRM to third parties instead of repaying the said Loan obviously triggered recovery action by MDVB – which was to sue the 2nd Plaintiff as the principal debtor and both the 1st Plaintiff and the Defendant who are guarantors.

Unsurprisingly, summary judgment was allowed, in the civil suit filed by MDVB, to be entered against all of them, making the Defendant a judgment debtor liable to repay the balance of the said Loan with interest and costs to MDVB.

The judgment sum payable by the Defendant to MDVB as a guarantor and now as judgment debtor is more than RM20million, not peanuts. This was gleaned from the Statement of Claim in the civil suit filed by MDVB, which is exhibited in the Defendant’s affidavit.

It is indisputable that the Defendant would not have been sued by MDVB if the 1st Plaintiff had utilised the payment received from PDRM to pay off MDVB instead of diverting it to the 2nd and 3rd Defendants (in the Counterclaim).

Based on the above findings, I find that the Defendant has satisfied the first requirement for a Mareva injunction by showing “a good arguable case”. S/N 0Gu7XjMsakukwbqloozEgQ GUAMAN NO.: WA-22NCvC-180-04/2023 37. As for the second requirement, there is no doubt that the 1st Plaintiff has assets within the jurisdiction of this Court – given the number of accounts that he holds at CIMB Bank Berhad and Bank Muamalat Malaysia Berhad.

Even though the 1st Plaintiff was also sued, as a guarantor, by MDVB for failing to utilise the money received from PDRM to repay the said Loan to MDVB, he appeared to have felt no urgency to settle with MDVB – allowing MDVB to proceed to apply for summary judgment against the 2nd Plaintiff, and both himself and the Defendant who are guarantors.

The risk of dissipation of the 1st Plaintiff’s assets is real because he had in fact done it once already by diverting money to others instead of fulfilling contractual obligations to repay MDVB upon receiving payment of RM37,100,000.00 from PDRM. Thus, the chances of the 1st Plaintiff dissipating his assets and money in the bank accounts under his control are high – which could render the Defendant’s counterclaim nugatory.

Besides bank accounts, the Defendant has included, in the list of the 1st Plaintiff’s assets to be restrained under the Mareva injunction, two super cars: a Lamborghini bearing registration number WAS 33 and a Bentley bearing registration number WAF 33. This Court takes judicial notice that those cars are of high value marques and the two-digit registration numbers are highly priced ones. Whilst it has not been proven that the 1st Plaintiff had utilised the RM37,100,000.00 that was received by the 2nd Plaintiff from PDRM to purchase those S/N 0Gu7XjMsakukwbqloozEgQ GUAMAN NO.: WA-22NCvC-180-04/2023 2 super cars and the registration numbers, these cars form part of the 1st Plaintiff’s assets that coulld be easily dissipated.

The fundamental principle on weighing the balance of convenience is as stated by the Federal Court in Alor Janggus Soon Seng Trading v. Sey Hoe Sdn Bhd [1995] 1 MLJ 241: “…the grant or refusal of an interlocutory injunction must be decided on the fundamental principle that the court should take whichever course that appears to carry the lower risk of injustice.”

Applying Alor Janggus (supra), it is my judgment that the interim Mareva injunction that was issued ex-parte was justified, and ought to remain in force until the disposal of this civil suit or until further order.

As for the Defendant’s prayer for a discovery order, it is common for a discovery order to be issued in aid of Mareva injunctions. The prayers sought by the Defendant are in effect to trace the RM37,100,000.00 that was received by the 2nd Plaintiff from PDRM. Disclosure by the 1st Plaintiff would reveal whether he has subsequently received any part of the money that he diverted to the 2nd and 3rd Defendants (in the Defendant’s Counterclaim). Thus, the Defendant has satisfied the requirements for a discovery order, as prayed, to be issued. Conclusion 44. The Defendant is required at this stage to show a good arguable case. There is no final ruling about the validity of the said Deed of Trust which is the subject of the 1st Plaintiff’s claim against the S/N 0Gu7XjMsakukwbqloozEgQ S/N 0Gu7XjMsakukwbqloozEgQ Counsel for the Plaintiffs: Muhammad Asif Bin Zahari SOLICITORS FOR THE PLAINTIFFS: MESSRS MOHAJI HAZURY & ISMAIL No.32M, Tingkat 1, Jalan Zirkon E7/E, Seksyen 7, 40000 SHAH ALAM, SELANGOR. Counsel for the Defendant: Ganesh A/L Magenthiran (Suronmani A/L Krishnan with him) SOLICITORS FOR THE DEFENDANT: MESSRS GANESH AZHAR & ASSOCIATES No. A-30-8, Menara UOA Bangsar, No. 5, Jalan Bangsar Utama 1, 59000 KUALA LUMPUR. S/N 0Gu7XjMsakukwbqloozEgQ

Keet Gerald Francis Noel John v. Mohd Noor @ Harun Abdullah [1995] 1 CLJ 293.

Mareva Compania Naviera SA v. International Bulk Carriers [1980] 1 All ER 213.

Zainal Abidin bin Haji Abdul Rahman v. Century Hotel Sdn Bhd [1982]

S & F International Limited v. Trans-Con Engineering Sdn Bhd [1985] 1 MLJ 62 5. Creative Furnishing Sdn Bhd v. Wong Koi [1989] 2 MLJ 153.

Biasamas Sdn Bhd v. Kan Yang Heng [1998] 4 MLJ 1.

Hock Hua Bank (Sabah) Bhd v. Yong Liuk Thin [1995] 2 MLJ 213 8. Alor Janggus Soon Seng Trading v. Sey Hoe Sdn Bhd [1995] 1 MLJ

241.

Anti-Money Laundering, Anti-Terrorism Financing and Proceeds of Unlawful Activities Act 2001 (“AMLA”).