Lee Eng Yik v Wong Mau Sang (BA-22NCvC-137-04/2026)

LEE ENG YIK (No K/P: 761115-14-5311)

LEE THONG LAI (No K/P: 510505-10-5191)

ANG TIEN KEONG (No K/P: 651008-10-6723) … PLAINTIF-PLAINTIF

WONG MAU SANG (No K/P: 620807-05-5051)

WONG ZHONG GUAN (No K/P: 950208-01-7071)

THEW FONG YEE (No K/P: 930601-10-5520)

EE LIAN HWA (No K/P: 650319-01-5648) … DEFENDAN-DEFENDAN 17/07/2026 10:41:23 BA-22NCvC-137-04/2026 Kand. 31 GROUNDS OF JUDGMENT Introduction [1] Enclosure 4 is the Notice of Application dated 14.4.2026 by the Plaintiffs for an ex parte ad interim injunction to restrain the Defendants from operating a hostel within the radius of 7.5 km from HELP University in Subang Bestari, in accordance with clause 8.3 of the sale and purchase agreement dated 3.7.2019. [2] An ex parte ad interim injunction was initially allowed on 24.4.2026. [3] However, upon the hearing of the application inter partes and upon perusal of the cause papers and written submissions, I have decided to set aside the ex parte ad interim injunction based on the reasons which I shall explain hereafter. Background facts [4] Hostelpro Sdn Bhd is a company incorporated in Malaysia under the Companies Act 1965 (“the Company”). The Company has a paid-up capital of ten thousand (10,000) ordinary shares (“the Shares”). The Shares were owned collectively by the Defendants. [5] The Company provide hostel accommodation for college and university students in the area of Subang Bestari. [6] By a sale and purchase agreement dated 3.7.2019 (“the Sale & Purchase Agreement”), the Defendants agreed to sell the Shares to the Plaintiffs. [7] The Sale & Purchase Agreement has already been completed and the Shares has been transferred from the Defendants to the Plaintiffs. The Plaintiffs have also taken over the Company’s hostel business in Subang Bestari. [8] There is a non-competition clause in the Sale & Purchase Agreement that restrains the Defendants from engaging in the business of hostel accommodation within a 7.5 km radius from HELP University in Subang Bestari for a period of ten (10) years from the date of the Sale & Purchase Agreement. [9] However, in March 2026, the Plaintiffs discovered that a new hostel was being set up in No 38, Jalan Nova U5/K Subang Bestari (“the Premises”). [10] Curious, the Plaintiffs conducted a land search and found that the Premises is owned by Aura Properties Sdn Bhd. The Plaintiffs then conducted a company search on Aura Properties Sdn Bhd and discovered that its shareholders are: - Shareholders Shareholding The 1st Defendant 225,000 ordinary shares The 2nd Defendant 225,000 ordinary shares Lau Cher Liang 300,000 ordinary shares [11] The new hostel is carried out under the brand name of “Ora Home” and is operated by Ora Home Sdn Bhd. The Plaintiffs conducted a company search on Ora Home Sdn Bhd and discovered that its shareholders are: - Shareholders Shareholding The 1st Defendant 15,000 ordinary shares The 2nd Defendant 70,000 ordinary shares The 4th Defendant 15,000 ordinary shares [12] The Plaintiffs claim that the Defendants had breached the non-competition clause. This is because the Premises is located within the radius of 7.5 km from HELP University in Subang Bestari and that the period of ten (10) years has not yet lapsed. [13] The Plaintiffs are now seeking for the following reliefs: -

A declaration that the Defendants had breached Clause 8.3 of the Sale & Purchase Agreement;

A declaration that the Defendants are bound by the terms of the Sale & Purchase Agreement;

An injunction to restrain the Defendants from operating the new hostel at the Premises;

General damages;

Aggravated damages;

Exemplary damages; and

In the alternative, account for profits. Summary of the Defendants’ case (in opposing Enclosure 4) [14] The Defendants argue that the non-competition clause found in in clause 8.3 of the Sale & Purchase Agreement is not meant to be read in isolation. Instead, it should be read together with clauses 20.1(c) and 20.2 of the Sale & Purchase Agreement. [15] There is a special overriding condition found in clause 20.1(c) of the Sale & Purchase Agreement, which allows the Defendants to rent out properties that belong to the Defendants for hostel accommodation in Subang Bestari. These properties must be owned by the Defendants either personally or jointly with other parties or registered in the name of the company belonging to the Defendants. [16] Clause 20.2 of the Sale & Purchase Agreement provides that in the event there is any inconsistency between the special overriding condition in clause 20.1 and other terms and conditions, the special overriding conditions shall prevail. The Defendants argues that the non-competition clause does not apply because Aura Properties Sdn Bhd is owned by the Defendants. [17] The Defendants also submit that the Plaintiffs’ claim is purely a monetary claim. Therefore, damages is an adequate remedy and the interlocutory injunction cannot be granted. The Defendants also argue that the balance of convenience does not lie in the Plaintiffs’ favour. [18] The Defendant also argue that they should be allowed to carry on their business at the Premises until and unless there is a finding that the Defendants have breached the terms of the Sale & Purchase Agreement. The Defendants also point out that the interim injunction has the effect of granting the Plaintiffs the final relief without actually going for trial. Such an interim injunction which virtually gives a full relief should never be granted save in exceptional cases. Summary of Plaintiffs’ case (in supporting Enclosure 4) [19] The Plaintiffs argue that clauses 8.3 and 20.1(c) of the Sale & Purchase Agreement must be read harmoniously and consistently with the overall commercial purpose and structure of the Sale & Purchase Agreement. The hostel accommodation at the Premises falls squarely within clause 8.3 and outside the limited exception contemplated under clause 20.1(c). [20] The Plaintiffs state that the dispute is not purely a monetary claim. The Plaintiffs want a declaration that the Defendants had breached clause 8.3 of the Sale & Purchase Agreement and an injunction to restrain the Defendants from operating the hostel at the Premises. The claims for general damages, aggravated damages, exemplary damages and account of profits are merely dependent on the Plaintiffs’ declaratory and injunctive reliefs. [21] The Plaintiffs also argue that damages are not an adequate remedy. The Plaintiffs are seeking to preserve the goodwill, exclusivity and commercial protections acquired under the Sale & Purchase Agreement. If the injunction is not allowed, the erosion of such exclusivity, goodwill and market positioning cannot be reversed through a subsequent monetary award. [22] The Plaintiffs also submit that the balance of convenience and balance of justice lie in their favour. The injunction order is narrow, targeted and limited in scope. It merely restrains the Defendants from continuing the hostel accommodation business at Subang Bestari. The Plaintiffs are not seeking to completely shut down the Defendants’ business operations nor prevent the Defendants from carrying on hostel accommodation activities elsewhere. Issues to be tried [23] The issues to be determined by this court are: -

1st Issue: - Whether there are bona fide issues to be tried?

2nd Issue: - Would damages be an adequate remedy?

3rd Issue: - Balance of convenience and maintenance of the status quo? Law on interim injunction [24] The principles upon which an interim injunction may be granted is laid down in American Cyanamid Co v. Ethicon Ltd [1975] 1 All ER 504, where it was held that an applicant must satisfy the court of the following: -

There are serious issues to be tried;

Damages would not be an adequate remedy if the plaintiff succeeds at trial; and

The balance of convenience lies in granting the injunction sought. [25] Similarly, in Keet Gerald Francis Noel John v. Mohd Noor @ Harun Abdullah & Ors [1995] 1 CLJ 293, it was held that a judge hearing an application for an interlocutory injunction must ask himself whether the totality of the facts presented before him discloses a bona fide serious issue to be tried. Bona fide issues to be tried [26] The dispute concerns whether the Defendants have breached clause 8.3 of the Sale & Purchase Agreement. The Premises is owned by Aura Properties Sdn Bhd. The shareholders of Aura Properties Sdn Bhd include the 1st Defendant and the 2nd Defendant. The hostel is operated by Ora Home Sdn Bhd. The shareholders of Ora Home Sdn Bhd are the 1st Defendant, 2nd Defendant and 4th Defendant. [27] Clause 8.3 of the Sale & Purchase Agreement provides that: - “8. OTHER MATTERS

8.3 Save for in respect of the properties owned personally by the Vendors or any of them, the Vendors hereby undertake to the Purchasers that they shall not within ten (10) years from the date hereof to be engaged in the business of the provision of students’ accommodation within a seven and a half kilometre (7.5 km) radius of HELP University’s premises in Subang Bestari, Selangor, whether directly or otherwise.” [28] The Defendants had argued that clause 8.3 is not meant to be read in isolation. Instead, clause 8.3 is to be read together with clause 20.1(c) and clause 20.2. Clause 20.1(c) and clause 20.2 of the Sale & Purchase Agreement provides that: “20. SPECIAL OVERRIDING CONDITIONS

20.1 Notwithstanding any terms and conditions to the contrary as stated in this Agreement, the Vendors and Purchasers hereby expressly undertake and agree as follow: ….

The Vendors shall be allowed to rent out all properties belonging to the Vendors personally or jointly with other parties or registered in the name of the company belonging to the Vendors for students accommodation purpose in Subang Bestari area notwithstanding any prohibition or restriction as stated in this Agreement.

20.2 In the event if there is any inconsistency between the special overriding conditions as above stated and other terms and conditions as stated in this Agreement and the Schedule annexed hereto, the special overriding terms and conditions stated in this clause shall always prevailed.” [29] I agree that there are triable issues insofar as the 1st Defendant, 2nd Defendant and 4th Defendant are concerned. This includes the issue of whether clause 20.1(c) and clause 20.2 of the Sale & Purchase Agreement allows the Defendants to carry on the business of hostel accommodation at the Premises. [30] However, I do not find that there are any issues to be tried in respect of the 3rd Defendant. The 3rd Defendant is neither a shareholder or director of Aura Properties Sdn Bhd or Ora Home Sdn Bhd. The Plaintiffs themselves do not make any factual averment in respect of the 3rd Defendant’s involvement in the alleged breach of the Sale & Purchase Agreement. Would damages be an adequate remedy? [31] Apart from the declaration and injunction, the Plaintiffs are seeking general damages, aggravated damages, exemplary damages and, in the alternative, account for profits. Since the Plaintiffs had claim for damages, it would be presumed that damages would be an adequate remedy. [32] In Associated Tractors Sdn Bhd v. Chan Boon Heng & Anor [1990] 2 MLJ 408, an injunction was not granted on the basis that the damages would be an adequate remedy. Hashim Yeop Sani CJ held as follows: - “But it would seem quite clear that the most important factor to consider as a matter of principle is the question of whether in lieu of the injunction damages would be an adequate and proper remedy because in the matter of injunctions and exercising its jurisdiction the Court acts upon the principle of preventing irreparable damage. As Lindley LJ said in London & Blackwell Rly. Co. v. Cross [1986] 31 Ch D 354 at p. 369: The very first principle of injunction law is that you do not obtain injunctions for actionable wrongs for which damages are the proper remedy. .... Therefore, the injunction was in our view not properly granted. In a case like this, it would be more appropriate to order an early hearing of the application to strike out the counter claim and the application for summary judgment rather than to grant the injunction.” [33] In Kawood Sdn Bhd v. HSBC Bank Malaysia Bhd & Ors [2001] MLJU 650, the court held that in the statement of claim, the plaintiffs are claiming for damages to be assessed together with interest. Therefore, by its own admission, the plaintiff acknowledged that damages are an adequate remedy and can be assessed and quantified. As such, the court said that there is no basis to grant the injunction to the plaintiff. [34] In Kilang Kosfarm Sdn Bhd v. Kosma Nusantara Bhd (No 2) [2002] 5 MLJ 662, Ramli Ali J (as he then was) held that the plaintiff have prayed in prayers 3 and 4 of the statement of claim for general and exemplary damages and to ascertain the damages suffered by the plaintiff from the time the plaintiff was expelled from the said estate until the time when vacant possession of the said estate is handed over to the plaintiff as prayed in prayer 2 of the statement of claim. On all those provisions, the court is satisfied those damages seem to be a suitable and adequate remedy for the plaintiff. [35] In Perak Hydro Renewable Energy Corporation Sdn Bhd & Anor v Wak Ngah Pili a/p Bah Adim [2022] MLJU 2570, the Court of Appeal held that the plaintiffs prayed for the defendants to pay damages to the plaintiffs for trespass and damages be assessed by the court. The prayer indicates that damages are an adequate remedy in the circumstances. Therefore, the basis for exercising the court’s equitable jurisdiction does not arise. [36] Apart from the cases cited above, there are also authorities that suggest that an award of damages would be an appropriate remedy in a purely contractual dispute. In Vista Summerose v. Datuk Bandar Kuala Lumpur [2019] MLJU 7029, the High Court dismissed an injunction application to restrain the defendant due to alleged breaches of an existing agreement. In dismissing the injunction application, the High Court held that damages would be an adequate remedy since the plaintiff’s claim therein arose from alleged financial losses due to a breach of contract. [37] Similarly, in Hilti (M) Sdn Bhd v. Byteering Sdn Bhd & Ors [2025] MLJU 439, the High Court dismissed an application for interlocutory injunction on the basis that the dispute was a pure contractual dispute. [38] The Plaintiffs had sought to argue that the injunction is to preserve the exclusivity and goodwill acquired by the Plaintiffs pursuant to the Sale & Purchase Agreement. However, I find the Plaintiffs’ arguments as rather vague and speculative. There is no real explanation put forth by the Plaintiffs as to what it meant by such exclusivity, goodwill and market positioning and as to how damages cannot be adequate. Balance of convenience and maintenance of the status quo [39] The Plaintiffs argued that the balance of convenience lies in their favour and that the injunction should be maintained to preserve the status quo pending the trial. The Plaintiffs also argued that the injunction is narrow, proportionate and commercially limited in scope. [40] However, I do not accept the Plaintiffs’ submissions. The reasonings by the Plaintiffs are not the real and material issues to consider in deciding the balance of convenience. I am of the opinion that restraining the Defendants from using their own property prior to any finding of breach would cause them immediate prejudice. [41] One of the biggest factors to be taken into account would be the fact that the injunction sought are akin to final reliefs. The legal position is that an interim injunction which virtually gives the full relief to be secured at the trial is never granted save in exceptional cases and extremely rare cases. [42] In RCA Sdn Bhd v. Pekerja-Pekerja RCA Sdn Bhd & Ors [1991] 1 MLJ 309, the Supreme Court held: - “The effect of the interim injunction granted in the present case is to give to the plaintiffs what they really want all along which they never had before without going to trial. An interim injunction which virtually gives the full relief sought to be secured at the trial is never granted save in exceptional and extremely rare cases: Sivaperuman v Heah Seok Yeong Realty Sdn Bhd [1979] 1 MLJ 150, the Federal Court at p 151 quoting with approval Geoffrey Lane LJ in Harold Stephen & Co Ltd & Ors v Post Office [1978] 1 All ER 939 at p 944: It can only be in very rare circumstances and in the most extreme circumstances that this court should interfere by way of mandatory injunction in the delicate mechanism of industrial disputes and industrial negotiations. In the present case there are no exceptional circumstances to warrant the grant of an injunction at the present stage. The only real circumstance here is that but for the injunction there will be some inconvenience to the plaintiffs in its membership drive.” [43] Interlocutory injunctions are only meant to maintain status quo pending the trial of the matter. Therefore, to restrict the Defendants from doing business at this juncture would not be maintaining the status quo, but instead punishes the Defendants when there is no finding of wrongdoing by the Defendants. There are no exceptional circumstances to warrant the grant of an injunction at the present stage since there is no finding that the Defendants are in breach of the Sale & Purchase Agreement. Conclusion [44] Accordingly, for the reasons above, Enclosure 4 is dismissed with costs at RM 8,000.00. Dated the 17th July 2026. (SEOW HOCK PENG) JUDICIAL COMMISSIONER HIGH COURT OF MALAYA SHAH ALAM, SELANGOR Counsel: For the Plaintiffs : Jonathan Khaw Chern Wei Kang Zhi Han (Messrs Chern & Co.) For the Defendants : Justin Ong Ing Hou Wee Yun Zhen (Messrs Justin Faye & Partners)

American Cynamid Co v. Ethicon Ltd [1975] 1 All ER 504 2. Keet Gerald Francis Noel John v. Mohd Noor @ Harun Abdullah & Ors [1995] 1 CLJ 293 3. Associated Tractors Sdn Bhd v. Chan Boon Heng & Anor [1990] 2 MLJ 408 4. Kawood Sdn Bhd v. HSBC Bank Malaysia Bhd & Ors [2001]

Kilang Kosfarm Sdn Bhd v. Kosma Nusantara Bhd (No 2) [2002] 5 MLJ 662 6. Perak Hydro Renewable Energy Corporation Sdn Bhd & Anor v Wak Ngah Pili a/p Bah Adim [2022] MLJU 2570 7. Vista Summerose v. Datuk Bandar Kuala Lumpur [2019] MLJU 7029 8. Hilti (M) Sdn Bhd v. Byteering Sdn Bhd & Ors [2025] MLJU 439 9. RCA Sdn Bhd v. Pekerja-Pekerja RCA Sdn Bhd & Ors [1991]