1. ) Ismail Bin Othman v 1. ) Seacera Group Bhd (WA-22NCC-603-10/2019)

ISMAIL BIN OTHMAN

ZAINAB BINTI MANSOR

MOHAMAD SUFFIAN BIN ISMAIL

MOHD RAZIP BIN HAMZAH

SITI HAIDAH BINTI ARIFFIN (NRIC NO.: 730117-10-6082) … PLAINTIFFS

SEACERA GROUP BHD

SEACERA PROPERTIES SDN BHD

DUTA NILAI HOLDINGS SDN BHD

DUTA SKYLINE SDN BHD (COMPANY NO.: 199501008954 (338152-U)) … DEFENDANTS GROUNDS OF JUDGMENT INTRODUCTION [1] In this action, the Plaintiffs sought various relief concerning the wrongful appointment and removal of directors and of the company secretary of 2 Companies namely Duta Nilai Holdings Sdn Bhd (“Duta Nilai”) and Duta Skyline Sdn Bhd (“Duta Skyline”). [2] The Defendants denied the claim and also filed a counterclaim against the Plaintiffs. [3] During trial conducted virtually online by using the Zoom video conferencing platform lasting 9 days, the Plaintiffs called one witness - the 1st Plaintiff (“Ismail” interchangeably, “1st Plaintiff”), whilst the Defendants also called one witness - Zulkarnin bin Ariffin (“Zulkarnin”) who is the Group Managing Director of the 1st Defendant and, a director of the 2nd, 3rd and 4th Defendants. [4] I had on 29.12.2021 dismissed the Plaintiffs’ claim and allowed part of the counterclaim. This judgment contains the reasons for my decision. As a counterclaim is a separate and independent action as explained in the case of Permodalan Plantations Sdn Bhd v Rachuta Sdn Bhd [1985] 1 MLJ 157 at p 161, I will, in these grounds, deal with the main action first. Background [5] The 1st Plaintiff, Ismail is the husband of the 2nd Plaintiff (“Zainab” interchangeably, “2nd Plaintiff”). The 3rd Plaintiff (“Suffian”) is the son of Ismail and Zainab. The 4th Plaintiff (“Razip”) was a director of Duta Skyline until his removal in 2019 whilst the 5th Plaintiff was the Company Secretary of Duta Nilai and Duta Skyline until she was terminated. [6] The 1st Defendant (”SGB”) is a public company listed on Bursa Malaysia. The 2nd Defendant (“SP”) is a wholly owned subsidiary of SGB. The 4th Defendant, Duta Skyline is a wholly owned subsidiary of the 3rd Defendant, Duta Nilai. [7] By a Sale & Purchase Agreement dated 15.5.2009 between SP as Purchaser and Duta Skyline as Vendor (“the 2009 SPA”), SP bought for the sum of RM26,750,000.00, a ¼ share of the Land held under Geran 23940, Lot 613, Mukim Ulu Semenyih, Daerah Ulu Langat, Negeri Selangor (“Lot 613”). By another Sale & Purchase Agreement dated 10.4.2012 between SP as Purchaser and Duta Skyline as Vendor (“the 2012 SPA”), SP bought for the sum of RM78,130,000.00 another ¼ share of Lot 613. [8]

10.1 having purchased ¼ Share by the 2009 SPA;

10.2 having purchased another ¼ share by the 2012 SPA; and

10.3 having acquired the other ½ share vide the purchase of all the shares of Duta Nilai from Ismail and Zainab vide the SSA. The Plaintiffs’ case [11] The Plaintiffs claimed that the appointment and removal of themselves as directors and the company secretary of Duta Nilai and Duta Skyline are wrongful as:

11.1 the Memorandum & Articles of these 2 Companies were not adhered to;

11.2 the statutory provisions were not followed and misconstrued;

11.3 there was a Board Constitution Agreement whereby it was mutually agreed between Ismail and Zainab and the Defendants that until such time Ismail had received his full consideration under the SSA, Ismail and his nominees namely the 2nd and 4th Plaintiffs shall be appointed directors and retain a seat on the Board of the 3rd and 4th Defendants respectively;

11.4 the appointment/removal were undertaken mala fide and were without the directors being given the right to be heard. [12] The Plaintiffs sought the following orders:

12.1 Against the 3rd Defendant:

12.1.1 A declaration that the 1st and 2nd Plaintiffs were and are to remain as directors of the 3rd Defendant under the Board Constitution Agreement until the 1st Plaintiff has been fully paid;

12.1.2 A declaration that the appointment of Norbatiah binti Zulkarnai (“Norbatiah”) and Nur Afiqah binti Hamzah (“Nur Afiqah”) as directors of the 3rd Defendant pursuant to the resolution dated 29.7.2019 by the 2nd Defendant is invalid and/or null and void;

12.1.3 A declaration that the notice or resolution dated 11.9.2019 for the removal of the 1st, 2nd and 3rd Plaintiffs as directors of the 3rd Defendant is invalid and/or null and void;

12.1.4 A declaration that the notice or resolution dated 11.9.2019 for the appointment of Mazlan bin Mohamad (“Mazlan”) as a director of the 3rd Defendant is invalid and/or null and void;

12.1.5 A declaration that the notice and/or resolution dated 8.8.2019 for the termination of the 5th Plaintiff and the appointment of Tan Tong Lang and Vimalraj a/l Shanmugam, both of Boardroom.com Sdn Bhd, as the new Company Secretaries of the 3rd Defendant is invalid and/or null and void;

12.2 Against the 4th Defendant:

12.2.1 A declaration that the 1st and 4th Plaintiffs were and are to remain as directors of the 4th Defendant under the Board Constitution Agreement until the 1st Plaintiff has been fully paid;

12.2.2 A declaration that the appointment of the Norbatiah and Nur Afiqah as directors of the 4th Defendant pursuant to the resolution dated 20.8.2019 by the 3rd Defendant is invalid and/or null and void;

12.2.3 A declaration that the notice or resolution dated 11.9.2019 for the removal of the 1st, 3rd and 4th Plaintiffs as directors of the 4th Defendant is invalid and/or null and void;

12.2.4 A declaration that the notice or resolution dated 11.9.2019 for the appointment of Mazlan as a director of the 4th Defendant is invalid and/or null and void;

12.2.5 A declaration that the board of directors’ meeting of the 4th Defendant held on 27.8.2019 and all resolutions passed thereat are invalid and/or null and void;

12.3 Consequent upon the Prayers above, the Plaintiffs sought orders:

12.3.1 that the directors appointed as aforesaid be restrained from acting and the 3rd and 4th Defendants be restrained from implementing and/or otherwise giving effect to the notice or resolution dated 11.9.2019 for removal of the relevant directors;

12.3.2 the respective Defendants to forthwith take steps to lodge all necessary documents and/or rectify the records with Suruhanjaya Syarikat Malaysia to give effect to or otherwise in the furtherance of any of the Orders made herein failing which the Registrar of the Court do sign all the relevant documents;

12.4 Against all the Defendants, a declaration that the Defendants are constructive trustees for the 1st Plaintiff in respect of all assets of the 3rd and 4th Defendants until the 1st Plaintiff has been fully paid;

12.5 General damages as may be assessed;

12.6 Interest on any amount of damages granted; and

12.7 Costs. The Defence [13] In summary, the Defendants contended that:

13.1 there was no such resolution dated 11.9.2019 as pleaded by the Plaintiffs;

13.2 the resolutions to remove Ismail, Zainab, Suffian and Razip are dated 11.10.2019;

13.3 there is no Board Constitution Agreement;

13.4 the removal of the Plaintiffs as directors from the board of directors of the 3rd and 4th Defendants as well as the termination of the Company Secretary were validly carried out;

13.5 the Defendants do not require the consent of 1st to 4th Plaintiffs to appoint new Directors;

13.6 the 3rd and 4th Defendants are entitled to appoint a new Company Secretary and consent of the Plaintiffs is not needed;

13.7 there is no breach of any fiduciary duty nor trust obligations as under the SSA as the 1st Plaintiff is only entitled to make a monetary claim against SP or SGB for any unpaid balance purchase price. Issues [14] The following are the parties’ agreed issues:

14.1 whether the appointment of Norbatiah, Nur Afiqah and Mazlan as directors of the 3rd and 4th Defendants is lawful;

14.2 whether the removal of the 1st, 2nd and 3rd Plaintiffs as directors from the 3rd Defendant is lawful;

14.3 whether the removal of the 1st, 2nd and 4th Plaintiffs as directors from the 4th Defendant is lawful;

14.4 whether the removal of the 5th Plaintiff as Company Secretary from the 3rd and 4th Defendants Plaintiff is lawful;

14.5 whether the appointment of Tan Tong Lang and Vimalraj a/l Shanmugam as Company Secretary of the 3rd and 4th Defendants is lawful;

14.6 whether the Defendants owe a contractual duty, duty of trust/constructive trust and a duty of care to the 1st and 2nd Plaintiff and whether there is a breach;

14.7 whether the acts/conduct of the Defendants under the control of Zulkarnin, Mohd Amir bin Abdullah and the new directors namely, Norbatiah, Nur Afiqah and Mazlan were to shut the Plaintiffs out from the affairs of the 3rd and 4th Defendants and for the Defendants to gain sole control of the 4th Defendant and control of Lot 613. This Court’s Findings [15] As I see it, the crux of the dispute between the parties here in essence relates to whether in fact the Board Constitution Agreement exists as alleged, and if there is, whether the alleged breach which led to the removal of the1st, 2nd and 3rd Plaintiffs as directors from the 3rd Defendant, the removal of the 1st, 2nd and 4th Plaintiffs as directors from the 4th Defendant, and the removal of the 5th Plaintiff as Company Secretary from the 3rd and 4th Defendants were lawful. [16] The Board Constitution Agreement is pleaded at paragraph 4.4 of the statement of claim (“SOC”) as follows: “Supplementary and additional to the SSA it had been further mutually agreed between the Ismail and Zainab and the Defendants that until such time of Ismail receiving his full consideration, Ismail and his nominees namely Zainab and Razip shall be appointed directors and retain a seat on the Board of DN and DS respectively (“the Board Constitution Agreement”).” [17] As the Board Constitution Agreement is said to be ‘supplementary and additional to the SSA”, it is necessary to construe the SSA as to what the parties have bargained for. It will thus be convenient to say a few words about the interpretation of a contract. [18] When looking at a contract, the Court needs to:

consider the whole contract;

(ii) give effect to every clause; and

(iii) bring each clause into harmony with the other clauses. see - City Investment Sdn Bhd v Koperasi Serbaguna Cuepacs Tanggungan Bhd [1985] 1 CLJ (Rep) 77 and Lucy Wong Nyuk King

(F) & Anor v Hwang Mee Hiong (F) [2016] 3 MLJ 689. [19] These principles were held by the Federal Court in Lucy Wong Nyuk King supra at page 700: "[34] … it is an established principle of construing a contract that, among others, a contract must be construed as a whole, in order to ascertain the true meaning of its several clauses, and also, so far as practicable, to give effect to every part of it. Each clause in an ordinary commercial contract should be so interpreted as to bring them into harmony with the other clauses of the contract (see National Coal Board v Wm Neill & Son (St Helens) Ltd [1984] 1 All ER 555 which was cited in Royal Selangor Golf Club v Anglo-Oriental (M) Sdn Bhd [1990] 2 MLJ 163; [1990] 3 CLJ Rep 37 and Mulpha Pacific Sdn Bhd v Paramount Corp Bhd [2003] 4 MLJ 357). In Australian Broadcasting Commission v Australasian Performing Right Association Limited (1973) 129 CLR 99, it was held that the whole of the contract has to be considered, since the meaning of any one part of it may be revealed by other parts, and the words of every clause must if possible be construed so as to render them all harmonious one with another. [35] Professor McMeel in The Construction of Contracts (Interpretation, Implication and Rectification) (2nd Ed, 2011) explains in clear words this long-standing canon of construction at para 1.73 as follows: Both the traditional and the modern approaches to construction stress the importance of having regard to the instrument as a whole. It is important not to fixate on one particular word or phrase and thereby neglect the overall purpose of the document or to give disproportionate importance to one phrase or clause. This is a long-standing rule. [36] As stated by Lewison in The Interpretation of Contracts (5th Ed) at para 7.02 that in order to arrive at the true interpretation of a document, a clause must not be considered in isolation, but must be considered in the context of the whole of the document. In Chamber Colliery Co Ltd v Twyerould (1893) [1915] 1 Ch 268n (which was cited by Lewison), Lord Watson said: I find nothing in this case to oust the application of the well known rule that a deed ought to be read as a whole, in order to ascertain the true meaning of its several clauses; and that the words of each clause should be so interpreted as to bring them into harmony with the other provisions of the deed, if that interpretation does no violence to the meaning of which they are naturally susceptible.” [20] The Federal Court in a judgment delivered by Azahar Mohamed FCJ (now CJM ) in the case of Wong Yee Boon v Gainvest Builders (M) Sdn Bhd [2020] 3 MLJ 571 has reiterated the principles in the Lucy Wong Nyuk King case. [21] It is also trite that when interpreting the meaning of the words used in a contract, they should be construed in their grammatical and ordinary meaning, except to the extent that some modification is necessary in order to avoid absurdity, inconsistency or repugnancy - The Interpretation of Contracts by Kim Lewinson; Malaysian Newsprint Industries Sdn Bhd v Perdana Cigna Insurance Bhd & Ors [2008] 2 MLJ 256 CA. [22] It is also a basic rule in the law of contract that what have been agreed by contracting parties should be given effect to. The Federal Court in Michael C. Solle vs United Malayan Banking Corporation [1986] 1 MLJ 45 said as follows: “The principles of construction to be applied to the undertaking are similar to those applied to an ordinary contract. The intentions of the parties are to be gathered from the language used. They are presumed to have intended what they said. The common and universal principle is that an agreement ought to receive that construction which its language will admit, which will best effectuate the intention of the parties, to be collected from the whole agreement.” [23] The construction of the SSA in this case is a question of law to be determined by the Court. It is not for the parties or their counsel to say what the SSA say or mean - Silver Concept Sdn Bhd v Brisdale Rasa Development Sdn Bhd (Formerly Known As Ekspidisi Ria Sdn Bhd) [2005] 4 MLJ 101 CA. Silver Concept (supra) was referred to by the Federal Court in Far East Holdings Bhd & Anor v Majlis Ugama Islam dan Adat Resam Melayu Pahang and other appeals [2018] 1 MLJ 1 where Jeffrey Tan, FCJ delivering the judgment of the court authoritatively said: “[156] It must be more than settled that the construction of a document is a question of law. In Munusamy v Public Services Commission [1964] 1 MLJ 239, where on the construction of an article of the Constitution which forbids the dismissal or reduction in rank of certain persons unless a certain condition is complied with, that is that the person concerned be given a reasonable opportunity of being heard, Thomson LJ said ‘That question of construction is a question of law …’. In Citicorp Investment Bank (Singapore) Ltd v Wee Ah Kee [1997] 2 SLR 759, Yong Pung How CJ said ‘we must approach the construction of the document, which is a question of law, untrammelled by any concession as to the meaning of the agreement that might have been given by the court below’. ‘It is trite that a question of construction is a question of law and not fact (see Bahamas International Trust Co Ltd and another v Threadgold [1974] 1 WLR 1514 (HL)’ (Bintulu Development Authority v Pilecon Engineering Bhd [2007] 2 MLJ 610 per Nik Hashim JCA, as he then was, delivering the judgment of the court). In Bahamas International Trust Co Ltd and another v Threadgold, Lord Diplock said ‘that the construction of a written document is a question of law’, which was followed in Tan Suan Heoh v Lim Teck Ming & Ors [1987] 2 MLJ 466, NVJ Menon v The Great Eastern Life Assurance Co Ltd [2004] 3 MLJ 38, Silver Concept Sdn Bhd v Brisdale Rasa Development Sdn Bhd (formerly known as Ekspidisi Ria Sdn Bhd) [2005] 4 MLJ 101, Padiberas Nasional Bhd v Kontena Nasional Bhd [2010] 3 MLJ 134, and The Government of India v Cairn Energy India Pty Ltd & Anor [2011] 6 MLJ 441 and Tun Dr Mahathir bin Mohamad & Ors v Datuk Seri Mohd Najib bin Tun Hj Abdul Razak [2017] 9 MLJ 1). In Desa Teck Guan Koko Sdn d v Sykt Hap FohBh Hing (suing as a firm) [1994] 2 MLJ 246, Ian Chin J opined that ‘……” [24] In contending that there is no Board Constitution Agreement, learned counsel for the Defendants pointed out that:

24.1 although paragraph 4.4 of the SOC pleaded that the Board Constitution Agreement was made between Ismail, Zainab and all 4 Defendants, yet:

24.1.1 in Ismail’ s answer to question 17 of his Witness Statement (P1), he testified as such: “S17 Selain daripada SSA tersebut adakah terdapat sebarang perjanjian lain di antara anda dan Defendan-Defendan? J. Ya. Sebelum dan bagi mencapai transaksi SSA ini, saya dengan jelas dan nyata telah memberitahu wakil-wakil SGB, SP dan DN bahawa saya, Zainab dan Razip perlu kekal sebagai pengarah bagi menjaga kepentingan saya sehingga segala hutang tertunggak diselesaikan. Zul, yang merupakan Pengarah SP dan Group MD kepada SGB telah bersetuju. Ini adalah sebahagian daripada tindakan yang diambil untuk menjaga kepentingan saya dalam urusan tanah Lot 613.”

24.1.2 During cross-examination, Ismail further contradicted himself as follows: Page 17 of Enclosure 96 (NOE on 13.7.2021) “CLM Dato’, boleh bantu kami dan tunjukkan apa-apa dokumen yang menunjukkan kewujudan percapaian yang dikatakan tadi? ISMAIL Persetujuan itu dibuat di antara saya, Suffian dan

Zul, di mana, sebab itu saya, selepas SSA

11.2016 ditandatangani, saya duduk di dalam kedua-dua syarikat. Begitu juga Suffian, Razip, ya, sehingga kami dipecat pada 2019. Jadi itu persetujuan perlembagaan yang dipersetujui. Kalau tidak, 16.11.2016, mereka sudah keluarkan saya.”

24.2 By Ismail’s answer in Q&A 17 as alluded earlier, and the following cross examination at Page 17 of Enclosure 96 (NOE on 13.7.2021 , the Board Constitution Agreement is said to be made prior the SSA: CLM Dato’, sekiranya board constitution agreement ini wujud, seperti yang dikatakan, tolong maklumkan kepada Mahkamah bilakah pencapaian yang dikatakan ini diwujudkan? ISMAIL Yang Arif, persetujuan itu kita buat sebelum saya menandatangani perjanjian SSA. Apabila group managing director setuju, saya, Suffian, Zainab dan Razip duduk di dalam syarikat, kedua-dua syarikat ini, sehingga pembayaran penuh dibayar kepada saya.”

24.3 the SSA contained an entire agreement clause viz , Clause 16.11.1 of the SSA which stipulates that “This Agreement (the SSA) constitutes the whole agreement between the parties in respect of the sale and purchase of the Sale Shares. This Agreement (the SSA) supersedes and extinguish any previous agreements between the Parties or between any of the Vendors and the Purchaser, whether orally or in writing, in respect of the sale and purchase of the Sale Shares which shall cease to have any further force and effect.”

24.4 clause 6.2.1 (iv) of the SSA which required the directors of Duta Nilai and Duta Skyline to furnish written resignations upon the completion date shows that the alleged Board Constitution Agreement does not exist. The 1st to 4th Plaintiff did furnish such resignation letters as admitted by Ismail in cross examination;

24.5 the Plaintiffs are barred from raising the ‘Board Constitution Agreement’ that allegedly exist prior to the SSA as it offended the parol evidence rule encapsulated in Sections 91 and 92 of the Evidence Act 1950 - Tindok Besar Estate Sdn Bhd v Tinjar Co [1979] 2 MLJ 229 at 233 where the FC held that “where the terms of a contract have been reduced to writing… the contract could only be proved by the document itself, and it is not open to the respondent to seek to introduce and the judge to admit evidence that would, inter alia, add new terms to it.”

24.6 Zulkarnin had explained that the Defendants did not make use of the undated resignation letters to remove the respective directors from Duta Nilai and Duta Skyline, but instead used resolutions to remove them as the undated resignation letters were lost. [25] Having heard the evidence, read the pleadings, documents and submission of the parties dealing with the relevant issues and evidence in detail, I am of the opinion that it serves no useful purpose to repeat all of them here. [26] Bearing in mind that it is undisputed that the Board Constitution Agreement is not in writing and as required under the SSA, Ismail and his nominees on the Boards of Duta Skyline and Duta Nilai were to resign upon completion of the SSA and towards this end, had deposited pre-signed resignation letters with SP, I take the utmost respectful view that the Plaintiffs have failed to prove the existence of the Board Constitution Agreement on a balance of probabilities and the claim must be dismissed. I have tested Ismail’s oral evidence against the probabilities of the case, and against the provisions of the SSA which is a contemporaneous document. My reasons follow. [27] First, if there was indeed a Board Constitution Agreement, a question begging an answer is: Why did Ismail and Zainab not incorporate the requirement of retaining them together with their son Sufian or Razip respectively on the Boards of the 3rd and 4th Defendants until the such time Ismail was paid his full consideration under the SSA? It is most confounding for after all, we are talking about a huge RM165.1million transaction; and Ismail is neither a “babe in the woods” nor a “country yokel” as described in Abdol Mulok Awang Damit v Perdana Industri Holdings Bhd [2003] 3 CLJ 497 at page 502. On the contrary, he was a director of Duta Nilai and Duta Skyline since incorporation on 29.7.89 and 31.3.95 respectively until removed in October 2019, with Duta Skyline owning properties of which Lot 613 alone is worth Ringgit Malaysia Hundreds of millions; he joined SGB since 2005 until he was transferred to SP as Project Director cum Advisor of Properties Division of SP since 2014 until 2019. [28] Second, the parties have reached finality in encapsulating all the terms of their bargain in the SSA which has an entire agreement clause housed in clause16.11.1. In my considered view, this entire agreement clause is of critical pertinence. Further, clause 16.11.2 provide that no variation to the SSA will be effective unless made in writing and signed by or on behalf of SP and Ismail and Zainab. These clauses read with clause 6.5 requiring the resignations of Ismail and his nominees as Directors on completion of the SSA, are unequivocal about the true intention of the parties and blow to smithereens and put paid the improbable existence of the oral “Board Constitution Agreement” posited by the Plaintiffs. In my judgment, there is no room to read into the SSA any other obligations other than what is written therein and no extraneous evidence may be considered to interpret, to supplement or to contradict the parties’ obligations already set out in the SSA - Wong Yee Boon v Gainvest Builders (M) Sdn bhd [2020] 3MLJ 571FC at p 599; [2020] 2 CLJ 727; Master Strike Sdn Bhd v Sterling Heights Sdn Bhd [2005] 3MLJ 585 CA; [2005] 2 CLJ 596 which approved Abdul Aziz J’s pronouncement in Macronet Sdn Bhd v RHB Bank Sdn Bhd [2002] 3 MLJ 11; [2002] 4 CLJ 729 where he said at p 25G: “My opinion is simply this. The entire agreement clause was an agreement between the plaintiffs and the defendants. In agreeing to the clause, the parties must be presumed to have known of the existence of s 92 and of the exceptions in it and to have intended what the clause intended, that is to exclude any attempt to vary the agreement by an oral agreement or statement, which attempt can only be made through the exceptions in s 92. By agreeing, therefore, to the entire agreement clause, the plaintiffs agreed not to resort to any of the exceptions in s 92. They cannot, therefore, be allowed to prove the second precontractual representation or the oral agreement and to rely on them.” [29] Third, s. 206 of the Companies Act 2016 and Article 69 of the respective articles of association of the 3rd and 4th Defendants allow shareholders to remove directors without assigning a reason. [30] Fourth, it is not the business of the Court to manage the affairs of a company; that is for the shareholders and directors - Shuttleworth v Cox Brothers and Company (Maidenhead) Limited [1927] 2 K.B. 9. It is also trite that the appointment and removal of directors belong to the internal management or affairs of the company and the Court will not interfere with the internal management of a company:

30.1 in Burland v Earle [1902] AC 83 at p 93, Lord Davey, when delivering the advice of the Privy Council expressed the proposition in the following words: “It is an elementary principle of the law relating to joint stock companies that the court will not interfere with the internal management of companies acting within their powers, and in fact has no jurisdiction to do so.”

30.2 in Owen Sim Liang Khui v Piasau Jaya Sdn Bhd & Anor [1996] 1 MLJ 113, the Federal Court stated: “Traditionally, courts have been reluctant to interfere with matters relating to the internal management of incorporated companies. Through a series of decisions of the Court of Chancery in the mid-nineteenth century, they administered unto themselves a jurisdictional prohibition from entering upon domestic disputes between corporators. Two landmark decisions settled the law upon the subject for all time. The first of these was Foss v Harbottle (1843) 67 ER 190; the second was Mozley v Alston (1847) 41 ER 833.” [31] Fifth, it was SP’s member resolution dated 11.10.19 that removed Suffian, Ismail and Zainab from the Board of Duta Nilai; and it was Duta Nilai’s member resolution dated 11.10.19 that removed Razip, Ismail and Suffian from the Board of Duta Skyline. The Plaintiffs’ pleaded case or relief is based on resolutions dated 11.9.2019 which do not exist. [32] Sixth, as for Siti’s removal as Company Secretary posited by the Plaintiffs to be also allegedly in breach of the Board Constitution Agreement, for the same reasons I have alluded to earlier, has no merit. In addition, clause 6.2.1 (v) of the SSA required the resignation letter of the Company Secretary of Duta Nilai and Duta Skyline to be deposited and to take effect upon completion. That is not all. Section 239 of the Companies Act 2016 and Article 95 of the respective articles of association of the 3rd and 4th Defendants allow the directors to remove the Company Secretary, which they did at Duta Nilai’s Board meeting of 8.8.2019 and Duta Skyline’s board meeting of 27.8.2019. Not only that, it is within the internal management of a company to appoint and remove the Company Secretary. [33] As for the remaining 2 issues whether there is breach of fiduciary duties, duty of care and trust/ constructive trust, whether the Plaintiffs’ removal is to shut the Plaintiffs out from the affairs of the 3rd and 4th Defendants for the Defendants to gain sole control of the 4th Defendant and control of Lot 613:

33.1 an examination of the SSA reveals plainly amongst others that in clause 6.5, Ismail and Zainab agreed that with effect from Completion, Ismail and Zainab shall not have any claim whatsoever to or over any of the Sale Shares, whether in connection with the failure of SP and/or SGB to pay the Balance Purchase Price or any part thereof or for any breach of the SSA by SP and/or SGB. Ismail’s sole remedy shall be a monetary claim against SP and/or SGB;

33.2 I also find insufficient pleading and evidence to justify a claim premised on breach of fiduciary duties, duty of care and trust/ constructive trust both in fact and in law; and

33.3 as such, the last 2 issues are answered in the negative. [34] It cannot be over emphasized that it is trite that when a document containing contractual terms is signed such as the SSA in this case, in the absence of fraud or misrepresentation, the party signing it is bound by its terms. The Court is to give effect to what the parties have agreed to. See:

34.1 Setapak Heights Development Sdn Bhd v Tekno Kota Sdn Bhd [2006] 2 CLJ 337: “[27] It is axiomatic that it is the duty of the court to give effect to the clear intention of the parties as expressed in cl. 5(b) of the agreement which is in clear, unambiguous and unmistakable language. In the Central Bank of India Ltd, Amritsar v Harford Fire Insurance Co Ltd AIR [1965] SC 1288 it was held that: Now it is commonplace that it is the court’s duty to give effect to the bargain of the parties according to their intention and when that bargain is in writing the intention is to be looked for in the words used unless they are such that one may suspect that they do not convey the intention correctly. If those words are clear, there is very little that the court has to do. The court must give effect to the plain meaning of the words however much it may dislike the result.”

34.2 Dato’ Sivananthan a/l Shanmugam v Artisan Fokus Sdn Bhd [2016] 3 MLJ 122 at para 31: “In law, parties are bound by the terms of the contract that they have entered into and likewise in this case, the rights and obligations of the parties are governed by the agreement. The intentions of the parties are to be gathered from the language used. They are presumed to have intended what they said... The duty of the court is to give effect to the clear intention of the parties as expressed in the agreement. If the words are clear, unambiguous and in unmistakable language, there is very little the court has to do. The court must give effect to the plain meaning of the words however much it may dislike the result.” [35] I should also make mention that the evidence adduced by the Plaintiffs did little to advance their case on the alleged existence of the Board Constitution Agreement, and do not accord with contemporaneous documentary evidence before the court and ought to be viewed for its veracity rather than plausibility. In this regard, I refer to Tindok Besar Estates Sdn Bhd v Tinjar Co [1979] 2 MLJ 229 where Chang Min Tat FJ said at p 234: “…For myself, I rely in the acts and deeds of a witness which are contemporaneous with the event and to draw the reasonable inferences from them than to believe their subsequent recollection or version of it, particularly if he is a witness with a purpose of his own to serve and if it did not account for the statements in his documents and writings. Judicial perception of the evidence requires that the oral evidence be critically tested against the whole of the other evidence and the circumstances of the case. Plausibility should never be mistaken for veracity.” (own emphasis) [36] I have not overlooked that the Plaintiffs have argued that the SSA was varied as Zulkarnin had admitted that Ismail and his nominees were not called upon to resign as they were needed to ‘advise on the development of Lot 613’. This evidence has to be tested against the totality of his evidence. In my view, any variation to be valid pursuant to clause 16.11.2 of the SSA has to be made in writing, which is not the case here. [37] In essence, I accept the Defendants’ arguments and find the Defence is credibly supported by evidence and has merits. Counterclaim [38] The relevant Defendants in the Counterclaim sought amongst others for:

38.1 a declaration that no sum is due and payable to the 1st Plaintiff by the 1st and 2nd Defendants;

38.2 a declaration that Ismail and Zainab have breached the terms and/or warranties in the SSA;

38.3 a declaration that Ismail and Zainab (jointly and severally) owe and/or is indebted to the SP for a sum of RM25,622,803-00 (being the unpaid Tax with penalty imposed by LHDN in respect of the 2 Disposals of Lot 613

38.4 that I s m a i l is liable for conversion/detinue in relation to the pleaded List of the Lot 613 Documents and to return them forthwith;

38.5 general damages; and

38.6 interest and costs. [39] The Defendants have also sought various declarations on the validity of appointment and removal of the various directors and Company Secretaries. Whilst the ambit of the Court’s powers to grant declaratory reliefs is unlimited, subject only to its own discretion - Dato Raja Ideris bin Raja Ahmad & Ors v Teng Chang Khim (Chairman of the select Committee on Competence, Accountability and Transparency and the Chairman of the Committee of Rights and Privileges State Legislative Assembly of Selangor) & Ors [2012] 5 MLJ 490 CA, at [28] and [29], for reasons I have already alluded and my conclusions in the main action regarding a company’s internal management powers to exercise such powers, these declarations sought in my view, are not necessary. No sum is due and payable to the 1st Plaintiff by the 1st and 2nd Defendants? [40] There is no dispute that pursuant to the SSA, the total purchase consideration of RM165,100,000.00 was to be paid to Ismail by way of 90,000,000 SGB shares (which were issued) and RM75,100,000.00 to be paid in of 5 instalments as follows:

2nd Anniversary of the Completion Date, ie 17.8.2017 17.8.2019 38% 28,538,000.00

4th Anniversary of 17.8.2017 17.8.2021 10% 7,510,000-00

6th Anniversary of 17.8.2017 17.8.2023 15% 11,265,000-00

8th Anniversary of 17.8.2017 17.8.2025 20% 15,020,000-00

9th Anniversary of 17.8.2017 17.8.2026 17% 12,767,000-00 TOTAL 100% 75,100,000.00 [41] There is also no dispute that of the RM75,100,000.00, firstly, a sum of RM9,400,000.00 has been paid to Ismail and secondly a sum of RM20,000,000.00 was assigned by Ismail to 4 companies. [42] In simple mathematics, RM75,100,000.00 less RM29,400,000 leaves a balance sum of RM45,700,000.00. [43] The Plaintiffs argued:

43.1 that this sum of RM45,700,000 was included by consent with Ismail as creditor in Shah Alam High Court OS No: BA- 24NVV-143-10/2019 (“OS 143”), a scheme of arrangement filed by SP and SGB and other companies; and the said sum was also included in another 2 schemes of arrangement in Kuala Lumpur High Court OS No: WA- 24NCC-70-2/2020 (“OS 70”) and Shah Alam High Court OS No: BA- 24NCC-141-12/2020 (“OS141”) filed for SP and SGB and other companies after an opposed intervener application by Ismail;

43.2 in the Counterclaim at Paragraph 16, the Defendants’ themselves have pleaded that the amount owing to Ismail is RM41,169,317.00 (which sum the Plaintiff do not agree with) and hence, there can be no prayer granted for Prayer 24

of the Counterclaim. [44] The Defendants on the other hand postulated that they have paid a sum of RM33,930,683.00 [including the RM9.4 million alluded earlier] by way of alleged set-off agreed to by Ismail. The Defendants asserted that the original documents supporting these claims were given to Messrs Mah Kamariyah and were lost by them. [45] I agree with Plaintiffs that the Defendants have failed to prove on a balance of probability the oral agreement between Ismail and SP on the alleged set off of RM33,930,683.00 from the amount payable to Ismail under the SSA. The Defendants although having argued this set-off at length, did not in my view pleaded the set-off adequately, nor produced any satisfactory evidence to show that the original documents supporting these claims were given to Messrs Mah Kamariyah and were lost by them. I find it stupendously eye-brow raising to note that no one from Messrs Mah Kamariyah was called as a witness to back the assertion that they have lost the documents. [46] Having examined the Counterclaim, in my judgment there is also a clear judicial admission in paragraph 16 of the Counterclaim made by the 1st and 2nd Defendants of a debt of RM41,169,317.00 to Ismail. The term “judicial admission” is explained in the case of Hu Chang Pee v Tan Sri Datuk Paduka (Dr) Ting Pek Khiing [1999] 3 MLJ 402, where Hasan JC, stated: “The learned authors in The Law of Evidence by Ratanlai and Dhirajlal (17 Ed, 1987) made the following comments relating to s 17 of the Evidence Act at p 53: Admissions may be oral or contained in documents, eg letter, depositions, affidavits, plaints, written statements, deeds, receipts, horoscopes. Admissions in pleadings are judicial admissions. They can be made the foundation of rights.“ [47] In light of the judicial admission (see also Yam Kong Seng & Anor v Yee Weng Kai [2014] 4 MLJ 478 FC), with utmost respect, it is cheeky for the 1st and 2nd Defendants to seek for what amounts to a perpetual declaration that no sum is due and payable to Ismail. Paragraph 24 (p) of the Counterclaim, on this ground alone falls. For completeness, I ought to add that the 1st and 2nd Defendants’ argument that Ismail had agreed orally to a set-off the amount of RM33,930,683.00 from the cash portion of the purchase consideration of RM75,100,000.00 is futile in my respectful view as any variation to the SSA has to be in writing - clause 16.11.2 SSA. Breach of Warranty [48] On 30.3.2018, Lembaga Hasil Dalam Negeri (“LHDN”) launched an investigation into whether tax is payable by Duta Skyline with regards to the disposal of Lot 613 pursuant to the 2009 SPA and the 2012 SPA transactions. [49] LHDN issued two Notices of Assessment both dated 31.5.2019 totalling RM22,184,245.33 to Duta Skyline as follows:

RM4,353,766.45 in respect of the 2009 disposal; and

RM17,830,478.88 in respect of the 2012 disposal . [50] The tax was not paid, resulting in the Government of Malaysia filing on 30.1.2020 Kuala Lumpur High Court Suit No: WA-21NCVC-11-01/2020 (“the LHDN Suit”) against Duta Skyline for RM25,622,803.00 being the amount stated in the Notices of Assessment as well as the penalties imposed (“the tax”). On 27.5.2021, the Government of Malaysia obtained judgment against Duta Skyline for the sum of RM25,622,803.00 (“tax with penalties”) with cost of RM3,500.00. [51] It was contended by the Defendants that Ismail and Zainab are responsible for the tax with penalties:

51.1 Ismail and Suffian had on 13.5.2019 signed and issued a letter on behalf of Duta Skyline to LHDN accepting LHDN’s imposition of tax for RM22,184,245.33 for the 2 Disposals and agreeing to pay penalties in case of late payment (‘the Letter of Admission”) notwithstanding that Duta Skyline was advised by its solicitors that the matter was time barred;

51.2 in the LHDN suit, the Government of Malaysia had relied on the Letter of Admission as pleaded in paragraph 5 of the Statement of Claim in the LHDN suit, filed an application for summary judgment and on 27.5.2021, obtained judgment against Duta Skyline for the sum of RM25,622,803.00 with cost of RM3,500.00;

51.3 alternatively, Ismail and Zainab had breached the terms in the SSA relating to the tax warranties that there is no liability for Taxation in respect of or arising from any transaction effected or deemed to have been effected on or before Completion and as such is liable to indemnify SP and/or SGB for the tax; such breaches of warranty were admitted in the Letter of Admission as well as Ismail’s testimony amongst others that, that no taxes were paid for the 2 disposals and finally, Ismail and Zainab had agreed in the SSA to indemnify SP and/or SGB for their breaches of warranties to SP. [52] In defending this head of claim, the Plaintiffs in summary postulated that:

52.1 the Defendants have not pleaded the specific warranty said to have been breached, which is fatal;

52.2 DW1 testified that Duta Skyline has not paid the LHDN Judgment; there can be no claim for indemnity for the 1st and 2nd Defendants as they have not paid the tax imposed by LHDN on Duta Skyline and the Counterclaim is inter-alia, premature;

52.3 the evidence that the 1st and 3rd Plaintiffs acted ‘without authority’ in issuing the Letter of Admission is not covered by any warranty in the SSA and hence cannot be claimed to be a ‘breach’; and

52.4 SP had undertaken due diligence prior to the completion of the SSA; the due diligence exercise was a condition precedent under the SSA at Clause 2.1. [53] In deciding this issue, it is apposite to produce the relevant provisions of the SSA: “9.2 Warranties

9.2.1 As a material inducement to the Purchaser to enter into this Agreement and consummate the transactions contemplated hereby, the Vendors represent and warrant to and undertake with the Purchaser (with the intent that the provisions of this Clause shall continue to have full force and effect notwithstanding Completion) in the terms set out in