Thai Odyssey Sdn. Bhd. v Chuah Seong Keat (WA-22NCC-218-05/2021)

THAI ODYSSEY SDN. BHD. [REGISTRATION NO. 199401025563 (311244-V)]

THAI ODYSSEY GROUP SDN. BHD [REGISTRATION NO. 201001038163 (922087-M)]

DIN TAN YONG CHIA

DION TAN YONG CHIEN

JARED ANG TZER SHEN

DIANA TAN SHEIK NI

THAI OYDSSEY MANAGEMENT SERVICES SDN BHD [REGISTRATION NO. 202101043862 (1444162-D)] … PLAINTIFFS

CHUAH SEONG KEAT

THUAN CHEW BOON

CHOO KIM WONG

LAI YIP POON

SPA ODYSSEY VENTURE BERHAD [REGISTRATION NO. 201701037084 (1251255-M)]

SPA ODYSSEY GROUP SDN. BHD. [REGISTRATION NO. 201801005904 (1267918-V)]

SPA ODYSSEY PROCUREMENT SDN. BHD. [REGISTRATION NO. 201901011381 (1320709-W)] ... DEFENDANTS GROUNDS OF JUDGMENT A. Introduction [1] The 1st to 3rd defendants filed an application for the discovery of documents (“Discovery Application”). The court dismissed the Discovery Application, after finding that there had been an inordinate delay in the filing of the Discovery Application, and that the test to seek discovery of the documents has not been met. B. Background Facts [2] The plaintiffs filed this action to recover monies of the 1st and 2nd plaintiffs that they alleged were misappropriated or misapplied by the 1st to 3rd defendants. The plaintiffs claimed the 1st to 3rd defendants, who were at all material times the directors and employee of the 1st and 2nd plaintiffs committed breaches of their duties, fraud, deceit and conspiracy to defraud. It is the plaintiffs’ case that the 1st to 3rd defendants had made false claims, caused wrongful payments to be made, wrongfully diverted funds, and placed themselves in positions of conflicts of interest, in advancing their personal interests to the detriment of the 1st and 2nd plaintiffs. [3] The 1st to 3rd defendants’ main defence is premised on the existence of a joint venture partnership and mutual understanding between the parties that the 1st to 3rd defendants shall always be in charge of the management and operations of the 1st and 2nd plaintiffs. [4] The Discovery Application was filed by the 1st to 3rd defendants to seek discovery of documents in Annexure A of the Discovery Application. The 1st to 3rd defendants claimed the documents are relevant and necessary for the fair disposal of this action, as they are related to the plaintiffs’ pleaded case. C. Delay [5] As a first consideration, I took note that there was a delay in the filing of the Discovery Application. The following chronology of events reflects this delay: a. The plaintiffs filed this suit on 11 May 2021; b. The plaintiffs filed their expert report dated 3 October 2022 by Ernst & Young (“EY”) on 4 October 2022 (“EY Report”); c. The court fixed trial dates during a case management on 31 October 2022. Trial was due to start on 20 November 2023; d. The 1st to 3rd defendants’ solicitors informed the court of their clients’ intention to file a discovery application during a case management on 12 June 2023; e. The 1st and 2nd defendants filed their rebuttal expert report dated 10 August 2023 by Virdos Lima Consultancy on 12 August 2023 (“VL Rebuttal Report”); and f. The 1st to 3rd defendants filed the Discovery Application on 12 October 2023. [6] From the above chronology, it is clear that the Discovery Application was filed approximately: a. Two and a half years after the filing of this suit; b. One year after this suit was fixed for trial; c. One year after the EY Report was filed; d. Two months after the VL Rebuttal Report was filed; and e. One month before the trial was due begin. [7] The timing of the filing of the EY Report and the VL Rebuttal Report is essential to my determination that there had been an inordinate delay in the filing of the Discovery Application. In my view, once the EY Report was considered by the 1st to 3rd defendants, they would have been able to assess the documents required for their defence. Thus, a discovery application could have been filed soon thereafter. Yet, the Discovery Application was only filed one year after the EY Report was filed. [8] Even assuming the EY Report is not sufficient for the 1st to 3rd defendants to assess what documents are required for their defence, there can be no doubt that by the time the VL Rebuttal Report was filed, the 1st and 3rd defendants should have been aware of the documents required. An application for discovery should then have been filed immediately after the VL Rebuttal Report was filed. However, it took the 1st to 3rd defendants two months after the filing of the VL Rebuttal Report, to file the Discovery Application. [9] It is also important to highlight that the court was notified during a case management on 12 June 2023 that the 1st to 3rd defendants were intending to file an application for discovery. However, the Discovery Application was only filed four months later. [10] In Eco Horizon Sdn Bhd v Occupants of the Arulmigu Sri Maha Muthu Mariamman Temple & Ors [2022] 7 MLJ 697, the court found that although discovery applications could be made at any time in the proceeding, practice dictated that they should be made once issues have been identified after the close of pleadings, and in the early stages of pre-trial case management, before the filing of the bundles of documents. The court found that there was an inordinate delay in the filing of the discovery application, a mere three weeks before trial. [11] The 1st to 3rd defendants relied on Rotta Research Laboratorium SpA v Ho Tack Sien [2010] 8 MLJ 733, a case where a discovery application was allowed during trial. The subject matter for discovery in that case is “Annex B”, a document required by the Drug Control Authority when considering an application for the registration and approval of a pharmaceutical product. The court allowed the application for discovery of “Annex B”, although it was made during trial, as it was found that the plaintiffs had made several requests to the defendants for the discovery of “Annex B”, but these requests were not allowed by the defendants. Further, the plaintiffs required “Annex B” for a very specific purpose, which is to compare the document with the “Annex B” in the plaintiffs’ possession, and in this regard, the test for discovery would have been met. [12] The situation that presents itself before this court is different. For the reasons elaborated further below, I find that the test to allow the discovery of the documents in Annexure A of the Discovery Application has not been met. [13] Further, I do not find the reasons for the inordinate delay in filing the Discovery Application to be acceptable. At all material times, the 1st to 3rd defendants were in the top management of the Thai Odyssey group, as Group Managing Director, Executive Director and Finance Director respectively. Due to their positions, they were likely to have been well-versed with documents of the Thai Odyssey group, and once the EY Report was filed, would have been able to confirm the documents required for their defence. [14] As such, there is no valid justification for the filing of the Discovery Application at such a late stage in these proceedings – a mere one month before the start of trial. An order for discovery at this stage would be oppressive, and will prejudice the parties and delay preparations for the trial. With these serious implications, such an order cannot be given without a valid justification for the inordinate delay. D. The Documents Subject To Discovery The documents [15] I moved on to consider the documents set out in Annexure A, which form the subject matter of the Discovery Application. They are as follows: a. Item 1 of Annexure A: Documents pertaining to “ITEM 4(2) – WRONGFUL “STAFF OR DIRECTORS” ADVANCES IN THE SUMS OF RM630,000.00”, itemised in paragraphs 54 to 57 of the reamended statement of claim; b. Item 2 of Annexure A: Documents pertaining to “ITEM 2 – WRONGFUL PAYMENT OF RM60,000.00 OF “ADVANCE PAYMENT FOR NEW SPA PRODUCT” INTO 1ST DEFENDANT’S PERSONAL ACCOUNT”, itemised in paragraphs 45 to 46 of the reamended statement of claim; c. Item 3 of Annexure A: Documents pertaining to “ITEM 7 – UNAUTHORIZED PAYMENTS FOR THE SOVB VENTURE”, itemised in paragraphs 64 to 69 of the reamended statement of claim; d. Item 4 of Annexure A: Documents pertaining to “ITEM 8 – UNAUTHORIZED PAYMENT AND GRANTING OF SHARES”, itemised in paragraph 70 of the reamended statement of claim; e. Item 5 of Annexure A: Documents pertaining to “ITEM 10 – PURCHASE OF OVERPRICED STOCKS FROM THE 7TH DEFENDANT SPA ODYSSEY PROCUREMENT SDN BHD”, itemised in paragraphs 72 to 74 of the reamended statement of claim; f. Item 6 of Annexure A: Documents pertaining to “ITEM 4 – WRONGFUL “ADVANCES FOR THAI STOCK” IN THE SUMS OF RM4,482,302.00 PAID TO THE 1ST DEFENDANT, RM579,656.00 PAID TO THE 2ND DEFENDANT AND “WRONGFUL FREIGHT” CHARGES IN THE SUM OF PURCHASE OF RM802,597.00 PAID TO THE 1ST DEFENDANT’S PERSONAL ACCOUNT”, itemised in paragraphs 50 to 53 of the reamended statement of claim; g. Item 7 of Annexure A: Documents pertaining to “ITEM 9 – UNAUTHORISED AGREEMENTS”, itemised in paragraph 71 of the reamended statement of claim; and h. Item 8 of Annexure A: Documents referred to in the EY Report. The test for discovery [16] The Discovery Application is made under order 24 of the Rules of Court 2012 (“ROC 2012”). Order 24 allows discovery to be sought over documents, by way of an order for a party: a. to serve a list of documents (order 24 rule 3); or b. to file an affidavit verifying a list of documents (order 24 rule 3); or c. to file an affidavit stating whether any document has been in a party’s possession, custody or power, and if not, when he parted with it and what has become of it (order 24 rule 7). [17] In Yekambaran Marimuthu v Malayawata Steel Bhd [1994] 2 CLJ 581, it was held that the following elements must be met for the court to grant an order for discovery: “The essential elements for an order for discovery are threefold; namely, first there must be a "document", secondly, the document must be "relevant" and thirdly, the document must be or have been in the "possession, custody or power" of the party against whom the order for discovery is sought.” (emphasis added) [18] Further, order 24 rule 8 of the ROC 2012 provides that the court shall make a discovery order only if necessary to dispose a matter fairly or to save costs. Order 24 rule 8 states that: “On the hearing of an application for an order under rule 3, 7 or 7A, the Court, if satisfied that discovery is not necessary, or not necessary at that stage of the cause or matter, may dismiss or adjourn the application and shall in any case refuse to make such an order if and so far as it is of the opinion that discovery is not necessary either for disposing fairly of the cause or matter or for saving costs.” (emphasis added) [19] Thus, in determining whether the Discovery Application should be granted, the court must consider whether: a. There are documents for which discovery is sought; b. The documents are relevant; c. The documents are in the possession, custody or power of the plaintiffs; and d. The discovery is necessary either for disposing fairly of this matter, or for saving costs. [20] For the reason explained below, I found that the documents in Annexure A of the Discovery Application have not met the requirements for the grant of an order for discovery over them. Item 1 of Annexure A: Documents pertaining to “ITEM 4(2) – WRONGFUL “STAFF OR DIRECTORS” ADVANCES IN THE SUMS OF RM630,000.00”, itemised in paragraphs 54 to 57 of the reamended statement of claim [21] Under item 4(2) of the reamended statement of claim, the plaintiffs alleged that the 1st and/or 2nd and/or 3rd defendants fraudulently, dishonestly and wrongfully approved and caused the payment of RM630,000 to be made from the 2nd plaintiff to the 1st defendant, vide seven separate payment vouchers. [22] The plaintiffs claimed that from the RM630,000, the amount of RM107,100 was later expensed off as “Runner Fee” in the 1st plaintiff’s books. The remainder, amounting to RM522,900 was subsequently set off against amounts said to be owing by the 2nd plaintiff to the 1st defendant. The plaintiffs claimed the set off was done by the 3rd defendant, by making a fraudulent upward journal adjustment of RM538,758.55 to the 1st defendant’s accounts with the 2nd plaintiff, and a dissipation of amounts owing by the 2nd plaintiff to the 3rd, 4th and 6th plaintiffs. [23] In this regard, the crux of the plaintiffs’ claim is that the 1st defendant had not returned the remaining RM522,900 to the 2nd plaintiff, and that there was a fraudulent adjustment made by the 3rd defendant to the 1st defendant’s account with the 2nd plaintiff. [24] The 1st to 3rd defendants’ defence is that the adjustment arose as a result of a restructuring exercise. [25] The documents for which discovery is sought under this heading, which are set out in item 1 of Annexure A are as follows: “1.1. Private and Confidential (Runner Fee)” File stated at page 8 of the Internal Palmgold Corporate Services Sdn Bhd (“Palmgold Corporate Services”) audit report dated 15.10.2018

1.2 The internal audit reports conducted by Palmgold Corporate Services on the 1st Plaintiff and 2nd Plaintiff from 2012 to 2022, excluding Palmgold Corporate Services audit report dated 15.10.2018.

1.3 The 7 cheques corresponding to the following 7 payment vouchers: a. Payment Voucher PV-011130 to the 1st Defendant in the sum of RM 100,000 dated 01.08.2017 as “Advance for Work Permit Quota”; b. Payment Voucher PV-011131 to the 1st Defendant in the sum of RM 100,000 dated 01.08.2017 as “Advance for Work Permit Quota”; c. Payment Voucher PV-011132 to the 1st Defendant in the sum of RM 100,000 dated 01.08.2017 as “Advance for Work Permit Quota”; d. Payment Voucher PV-011133 to the 1st Defendant in the sum of RM 100,000 dated 01.08.2017 as “Advance for Work Permit Quota”; e. Payment Voucher PV-011134 to the 1st Defendant in the sum of RM 100,000 dated 01.08.2017 as “Advance for Work Permit Quota”; f. Payment Voucher PV-011135 to the 1st Defendant in the sum of RM 100,000 dated 01.08.2017 as “Advance for Work Permit Quota”; and g. Payment Voucher PV-011133 to the 1st Defendant in the sum of RM 30,000 dated 01.08.2017 as “Advance for Work Permit Quota”,

1.4. Signed directors’ confirmation and general ledgers in relation to amounts due to/due from all directors for FYE 2019 and FYE 2020 for the 1st Plaintiff and 2nd Plaintiff” [26] In respect of item 1.1, the court finds that the file and the documents in the file are not relevant to the plaintiffs’ claim, nor are they necessary for the fair disposal of this action. The 1st to 3rd defendants’ claim of the existence of a file appears to be based on paragraph 3(ii) of the internal audit memorandum dated 15 October 2018 (“2018 Audit Memorandum”). The paragraph states that: “Private and confidential file (Runner fee) was easily accessible by staff members of all levels in the Finance Dept. as it was placed on an open rack in the Finance Dept.” [27] The statement does not confirm the existence of a “Private and Confidential (Runner Fee) File”, as referred to in item 1.1 of Annexure A of the Discovery Application. [28] In a supplemental report dated 19 October 2022 by EY (“EY Supplemental Report”), EY highlighted that the file referred to in the 2018 Audit Memorandum is presumably a ring file described as “Runner Fee Year 2013 – Latest”. EY also confirmed that they have perused the content of the file, which contains 25 confidential documents spanning ten years between 2013 to 2023, and they have found no document and/or information in relation to the RM630,000 paid to the 1st defendant. [29] It is on this basis that I concluded that the file and the documents in the file are not relevant to the plaintiff’s claim, and are not necessary for the fair disposal of this action. [30] Next, in item 1.2 of Annexure A, the 1st to 3rd defendants requested for internal audit reports spanning 11 years, from 2012 to 2022. They have not specified how these reports are relevant to the plaintiffs’ claim for RM630,000, especially when the issue arising from this sum had already been referred to in the 2018 Audit Memorandum. Thus, I find the 1st to 3rd defendants’ attempt to seek discovery of these reports to be a fishing expedition. [31] In Selve a/p R Renganathen v Sowbhagyavati a/p Renganathen & Ors [2020] MLJU 1865, the court found that the categories and extent of discovery sought over medical records spanning a period of 12 months are too wide. The court also found that the party seeking discovery had not offered sufficient explanation to justify the relevance of the medical documents to the pleaded issues. [32] This is the same situation that presents itself before this court. The 1st to 3rd defendants’ application for discovery over internal audit reports that span over 11 years is unduly wide and oppressive, and even more oppressive is the fact that no explanation is provided as to how the reports are relevant to the issue of the amount of RM630,000 paid to the 1st defendant. [33] For item 1.3, the 1st to 3rd defendants are seeking the discovery of cheques that correspond to the payment vouchers for the total payment of RM630,000 made to the 1st defendant. I am of the view that the cheques are irrelevant and unnecessary for the fair disposal of this action, as the 1st defendant has not disputed that the amount of RM630,000 was paid to him in 2017. The cheques would not be of assistance to prove or disprove any matter in issue. [34] In item 1.4 of Annexure A, the 1st to 3rd defendants are seeking: “Signed directors’ confirmation and general ledgers in relation to amounts due to/due from all directors for FYE 2019 and FYE 2020 for the 1st Plaintiff and 2nd Plaintiff” [35] I find item 1.4 to be irrelevant to the core issue of the plaintiffs’ claim, namely the fraudulent adjustment made to the 2nd plaintiff’s account balances by the 3rd defendant. The signed directors’ confirmations and general ledgers for 2019 and 2020 would not show that adjustments were made to the 2nd plaintiff’s accounts. Instead, they would merely record the amounts in the 2nd plaintiff’s accounts, after the adjustments were made. The question of whether the 3rd defendant had the authority to make the adjustments, and similarly, the 1st to 3rd defendants’ defence that the adjustment was a result of a share restructuring exercise, would not be able to be proved or disproved by the directors’ confirmations and general ledgers. Item 2 of Annexure A: Documents pertaining to “ITEM 2 – WRONGFUL PAYMENT OF RM60,000.00 OF “ADVANCE PAYMENT FOR NEW SPA PRODUCT” INTO 1ST DEFENDANT’S PERSONAL ACCOUNT”, itemised in paragraphs 45 to 46 of the reamended statement of claim [36] The plaintiffs’ claim against the 1st defendant is for the misappropriation of an amount of RM60,000, which was paid by Tasik Villa Holding Sdn Bhd (“TVH”) to the 1st defendant’s personal account, at the expense of the 1st plaintiff. [37] The plaintiffs claimed that the RM60,000 paid to the 1st defendant was an advance for expenses related to the opening of the Tasik Villa outlet. In this regard, the 1st plaintiff had issued an invoice dated 31 March 2019 to TVH for expenses in the sum of RM188,846.60 for the opening of the outlet (“March 2019 Invoice”). The amount in the March 2019 Invoice remains unpaid. [38] The plaintiffs claimed that the RM60,000 which was paid at the expense of the 1st plaintiff was never returned by the 1st defendant to the 1st plaintiff. To support their claim, the plaintiffs provided evidence in the form of several documents, namely a statutory declaration made by the representative of TVH stating that the RM60,000 was meant to have been an advance for expenses for the opening of the Tasik Villa outlet, stock count sheets which set out all items delivered to the Tasik Villa outlet culminating in the March 2019 Invoice, internal order forms for TVH, and a delivery order confirming the delivery of stocks to the Tasik Villa outlet. [39] The 1st defendant however claimed that the RM60,000 was paid to him pursuant to a private arrangement between himself and the representative of TVH. [40] The documents for which discovery is sought under this heading, which are set out in item 2 of Annexure A are as follows: “2.1. Stock count sheets for stock count done on 01.04.2021 and any subsequent stock counts pertaining to items delivered to Tasik Villa Port Dickson Thai Odyssey franchise outlet

2.2. Payment vouchers and the relevant supporting documents, namely the purchase invoices, bills and receipts for the purchase of all items included in the invoice billed to Tasik Villa Holding Sdn Bhd (“TVHSB”) amounting to RM 188,846.80 (invoice no. TO19/00072)

2.3. Credit note no. CN21/0009 amounting to MYR75,538.72 with the description “TPD: 40% discount for outlet opening expenses” and relevant supporting documents justifying the issuance of the said credit note” [41] Items 2.1 and 2.2 have been provided in the EY Supplemental Report. [42] Generally, these documents would support the items purchased for the Tasik Villa outlet, which are included in the March 2019 Invoice. The purchase of these items is not in issue. The issues are whether the purpose of the RM60,000 was as an advance for the opening of the Tasik Villa outlet, and whether the 1st defendant had misappropriated the said sum. [43] I fail to see how these documents would support the allegation of misappropriation of the sum of RM60,000 by the 1st defendant. Nor would they support the 1st defendant’s defence that the sum was paid pursuant to a private arrangement between him and the representative of TVH. [44] As such, I find the documents sought in item 2 to be irrelevant to the issue in dispute. Item 3 of Annexure A: Documents pertaining to “ITEM 7 – UNAUTHORIZED PAYMENTS FOR THE SOVB VENTURE”, itemised in paragraphs 64 to 69 of the reamended statement of claim [45] The plaintiffs’ claim under this heading pertains to the unauthorised funding of RM9,655,361 by the 1st plaintiff to the 5th defendant and its subsidiaries. The plaintiffs claimed the funding was wrongfully caused by the defendants, in breach of the representations and assurances given by the 1st defendant that the 5th defendant would be financially independent from the 1st plaintiff. [46] The documents for which discovery is sought under this heading, which are set out in item 3 of Annexure A are as follows: “3.1. Financial records/transactions of the 5th Defendant and its subsidiaries namely the 6th Defendant Spa Odyssey Group Sdn Bhd (“SOGSB”), Taicang Thai Odyssey Health Management Co Ltd (“TTOHMCL”), Nanjing Thai Odyssey Health Management Co Ltd (“NTOHMCL”), and Wellness Planet Co Lt (Cambodia)(“WPCL”), being the following documents for these companies from 13.10.2017 to 31.12.2020: a. General ledgers; b. Cash Book Listings; c. Journal Vouchers and relevant supporting documents namely invoices, pro forma invoices, bills, receipts, quotations, purchase orders, packing lists, delivery orders; d. Payment Vouchers and relevant supporting documents namely invoices, pro forma invoices, bills, receipts, quotations, purchase orders, packing lists, delivery orders; and e. Bank statements together with bank reconciliations.” [47] The documents in item 3.1 are the corporate internal documents of the 5th defendant and its subsidiaries, who are the 6th defendant, Taicang Thai Odyssey Health Management Co Ltd, Nanjing Thai Odyssey Health Management Co Ltd and Wellness Planet Co Ltd (Cambodia) (collectively, the “SOVB Entities”). [48] The internal documents of the SOVB Entities are not the plaintiffs’ documents, but are documents of third parties and the 5th and 6th defendants. As such, I find that the third test in Yekambaran Marimuthu (supra) has not been met, as the documents are not in the possession, custody or power of the plaintiffs. [49] In Sean Su Wei Jiang v Mahkamah Perusahaan Malaysia & Anor [2023] 1 LNS 1534, the court held that the discovery application was correctly dismissed by the Industrial Court. In arriving at this decision, the court took into consideration of the fact that the applicant was seeking a broad range of third party companies’ documents. [50] The SOVB Entities were also at the material times under the full control of the 1st and 4th defendants, and not the plaintiffs. Thus, I am of the view that the 1st to 3rd defendants are wholly misconceived in seeking discovery of the documents in item 3.1 from the plaintiffs. [51] It is also important to stress that the plaintiffs’ claim is that the defendants had caused the 1st plaintiff to fund the 5th defendants and its subsidiaries in an unauthorised manner. However, the 1st to 3rd defendants failed to demonstrate how the documents in item 3.1 are relevant to the plaintiffs’ claim. The documents for which discovery is sought are financial documents of the SOVB Entities between 2017 to 2019, which are identified in a general manner. There is no explanation or specification provided on how they are relevant to the plaintiffs’ claim. I am of the view that the documents are too wide and lack specification, and that the request for these documents amounts to a fishing expedition. [52] I am guided by the findings in Licvem Shipping & Trading Aps v JLM Logistics (M) Sdn Bhd [2016] 10 MLJ 247 and Syarikat V K Kalyanasundram Sdn Bhd v Kalyani Balasubramaniam & Ors [2023] 1 LNS 777, where discovery applications were dismissed by the court, as the financial information sought was far too wide and for far too long a period. Similarly in the present case, I am unable to allow discovery of financial documents that have not been specifically identified to be relevant to the issue at hand, and that span over a period of two years. Item 4 of Annexure A: Documents pertaining to “ITEM 8 – UNAUTHORIZED PAYMENT AND GRANTING OF SHARES”, itemised in paragraph 70 of the reamended statement of claim [53] The plaintiffs’ claim under this heading pertains the granting of shares in the 5th defendant to seven individuals, including the 1st defendant. The plaintiffs claimed the grant of the shares was unjustified, as they were granted without any cash consideration, and were charged to the 1st plaintiff by eliminating the debt balances owed by the 5th defendant to the 1st plaintiff. There are no accounting records or documents to support these transactions. [54] The defendants’ defence is that the shares were issued to set off debt owed by the 1st plaintiff to the said individuals. [55] The documents for which discovery is sought under this heading, which are set out in item 4 of Annexure A are as follows: “4.1. General ledgers of Zhu Li, You Wai Yin and Yap Heng Huat in the 1st Plaintiff and 2nd Plaintiff’s accounts from 13.10.2017 to 31.12.2020.

4.2. General ledgers of Chow Chooi Mei, Goh Hui Kie and Low Kian Seng in PT Thai Odyssey Indonesia (“PTTO”) accounts from 13.10.2017 to 31.12.2020.” [56] In respect of item 4.1, the general ledgers for the year 2018 were provided in the EY Supplemental Report. The request for the general ledgers for the other years – 2017, 2019 and 2020 – is in my view unjustifiable, as the 1st to 3rd defendants did not specify how they are relevant to the issue in dispute. This is especially important since the shares in question were granted in 2018. [57] The 1st to 3rd defendants have made general assertions on the relevance of these documents. They claimed that the general ledgers are required to “shed light” on the defendants’ position that the granting of the shares was to set off debt owed by the 1st plaintiff. They also claimed that the general ledgers are necessary to “perform further verification” of the transactions. These general assertions are in my view insufficient to justify an order for discovery. In Selve a/p R Renganathen (supra), the court held that: “[14] It is insufficient for the Plaintiff to merely make an assertion of necessity and / or relevance as per the Plaintiff’s Affidavit-in-Support. The Plaintiff’s failure to support her assertions with cogent affidavit evidence is fatal to her discovery applications: see Goo Saw Jin v Hwang Sze Yunn & Anor [2018] MLJU 367 where Nantha Balan J (as he then was) upheld the learned Sessions Court’s decision dismissing the plaintiff’s discovery application. His lordship was of the view that it is insufficient for the plaintiff to make bare assertion of “necessity”, the plaintiff must prove it. Failure to do so would mean that the discovery application must fail:- “[47] Thus, in applying the relevant legal principles to the facts of the present case, it may be accurate to state that when the plaintiff’s discovery application is viewed through the “lens of necessity”, it is clear that the plaintiff was completely failed to address the requirement of necessity. The plaintiff has merely asserted that the documents are purportedly relevant without demonstrating in what way they are relevant.”” [58] The request by the 1st to 3rd defendants for these documents without sufficient justifications of their relevance and their necessity for the disposal of this action is unjustified and cannot be allowed. [59] Item 4.2 are documents that belong to a third party, PT Thai Odyssey Indonesia (“PTTO”). For the same reason I found the request for documents of the SVOB Entities unjustified as they are documents belonging to third parties, I also find the discovery of documents of PTTO to be equally unjustified. Item 5 of Annexure A: Documents pertaining to “ITEM 10 – PURCHASE OF OVERPRICED STOCKS FROM THE 7TH DEFENDANT SPA ODYSSEY PROCUREMENT SDN BHD”, itemised in paragraphs 72 to 74 of the reamended statement of claim [60] Under this heading, the plaintiffs claimed that the 1st defendant had on his own volition incorporated the 7th defendant, to source products from third party suppliers, and to subsequently sell the products to its related parties for the Thai Odyssey business. The sole shareholders of the 7th defendant are the 1st and 4th defendants, and the plaintiffs claimed they had benefited through unauthorised funding from the 1st plaintiff, and in the marking up of prices of stocks sold by the 7th defendant. As a result of the unauthorised funding, the amount of RM2,271,396 remains due to the 1st plaintiff. [61] The defendants’ defence is that the shares in the 7th defendant were held by the 1st and 4th defendants on trust for the 1st plaintiff. They claimed a trust deed was prepared for this purpose. The trust deed has not been sighted. [62] The documents for which discovery is sought under this heading, which are set out in item 5 of Annexure A are as follows: “5.1. Bank statements and general ledgers in relation to the 1st Plaintiff’s ledger from 01.01.2019 to 31.12.2020

5.2 Supporting inventory and warehouse records including all originals of Thai invoices/bills/receipts, delivery orders, goods received notes and packing lists for purchases made from the 7th Defendant by the 1st Plaintiff from 01.01.2019 to 31.12.2020” [63] Similar to the documents in item 4.1, the 1st to 3rd defendants have made sweeping and general assertions on the relevance of the documents in item 5.1 to these proceedings. The 1st to 3rd defendants claimed the documents are “relevant and necessary to show actual movement of funds”. It should be noted that the documents requested are financial documents of the 1st plaintiff over a period of two years. The scope of the documents and the period of time for which discovery is sought are far too broad for the court to justify the grant of an order for discovery. The manner in which the 1st to 3rd defendants are seeking discovery is akin to a fishing expedition embarked in hopes of obtaining further information to support their defence. [64] Next, the request for item 5.2 must also fail due to the lack of specificity. The 1st to 3rd defendants have yet again requested for documents – in this case invoices, bills, receipts, delivery orders – over a period of two years, and with no detail or specification of the documents required, and how they are relevant to the issue at hand. For the same reason that I have not allowed discovery of items 4.1 and 5.1, the 1st to 3rd defendants’ request for documents in item 5.2 must also be rejected. Item 6 of Annexure A: Documents pertaining to “ITEM 4 – WRONGFUL “ADVANCES FOR THAI STOCK” IN THE SUMS OF RM4,482,302.00 PAID TO THE 1ST DEFENDANT, RM579,656.00 PAID TO THE 2ND DEFENDANT AND “WRONGFUL FREIGHT” CHARGES IN THE SUM OF PURCHASE OF RM802,597.00 PAID TO THE 1ST DEFENDANT’S PERSONAL ACCOUNT”, itemised in paragraphs 50 to 53 of the reamended statement of claim [65] Under this heading, the plaintiffs claimed that the 1st to 3rd defendants had caused unlawful payments for “Advances – Thai Stock”, “Transport & Freight Charges” and “Transport, Freight and Handling Charges” to be made from the 1st plaintiff to the 1st and 2nd defendants’ personal accounts. The plaintiffs claimed these payments were unsupported by documents, and the sums paid were misappropriated by the 1st and 2nd defendants. [66] The documents for which discovery is sought under this heading, which are set out in item 6 of Annexure A are as follows: “6.1 Management letters issued by external auditors and/or board of directors for the audit of the 1st Plaintiff and 2nd Plaintiff from FYE 2012 to FYE 2020 in relation to advances and payments to subsidiaries and adjustment of amounts due to directors

6.2 Original signed 1st Plaintiff’s Payment vouchers and its relevant supporting documents namely invoices, pro forma invoices, bills, receipts, quotations, purchase orders, packing lists and delivery orders inventory, GRN listings, GRN issued packing lists, purchase requisition forms, and warehouse records for Thai stocks and advances to directors for the purpose of Thai Stocks from 2012 to 2020” [67] The core issue for the court’s consideration is whether the payments made by the 1st plaintiff to the 1st and 2nd defendants were supported by documents, and whether the sums paid were misappropriated by the 1st and 2nd defendants. The claim is specifically targeted to identified payments, namely payments made towards “Advances – Thai Stock”, “Transport & Freight Charges” and “Transport, Freight and Handling Charges”. [68] However, yet again the 1st to 3rd defendants failed to identify the documents with the level of detail and specificity required for a discovery order to be granted. The documents sought are management letters and payment vouchers, spanning a period of nine years. The 1st to 3rd defendants have failed to explain how these documents are relevant to the claim of unauthorised payments made. This failure is fatal to the 1st to 3rd defendants’ application for discovery of these documents. [69] Further and in any event, I fail to see how the documents sought in items 6.1 and 6.2 would be useful to the issue in dispute under this heading, which is whether the payments made were supported by documents, and the sums paid were misappropriated by the 1st and 2nd defendants. The management letters in item 6.1 are letters issued for audit purposes. They are unlikely to shed light on the plaintiffs’ claim and the defendants’ defences on the authorisation of the sums in question andthether the sums were misappropriated by the defendants. As such, they are irrelevant to the core issue under this heading. Item 7 of Annexure A: Documents pertaining to “ITEM 9 – UNAUTHORISED AGREEMENTS”, itemised in paragraph 71 of the reamended statement of claim [70] It must first be highlighted that although item 7.1 of Annexure A refers to documents pertaining to item 11 of the reamended statement of claim, upon a closer look, this reference appears to be a typographical error. The correct reference is item 9 of the reamended statement of claim, which pertains to a subsidiary of the 5th defendant, Nanjing Thai Odyssey Health Management Co. Pte. Ltd. (“NJTO”). The documents sought for discovery under item 7.1 are NJTO’s documents, namely: “7.1. Financial reports and general ledgers of NOTHMCL for the years 2018 to 2021.” [71] The plaintiffs’ claim under item 9 of the reamended statement of claim is that the 1st defendant has acted against the decision of the board of the Thai Odyssey group, and wrongfully authorised the execution of, amongst others, a joint venture agreement dated 1 August 2020 between NJTO and Golden Eagle International Trading Group (China) Ltd (“GE JVA”). [72] The defendants’ main defence is that the GE JVA was executed for the benefit of the 1st plaintiff, and specifically for the expansion of the Thai Odyssey business to China. [73] However, save for this averment, the 1st to 3rd defendants have not provided any evidence to prove that the GE JVA was executed for the 1st plaintiff’s benefit. Neither have the 1st to 3rd defendants shown how item 7.1 of Annexure A – consisting of financial reports and general ledgers of NJTO over a period between 2018 until 2021 – would be relevant and necessary for the fair disposal of this action. [74] Instead, in the affidavit in support of the Discovery Application, the 1st defendant merely averred that the documents are “relevant and necessary to prove that the joint venture between NTOHMCL and GEL was ultimately for the benefit of TOSB and was necessary to for the survival of the company during Covid-19”. In my view, such a bare averment cannot justify the grant of an order for discovery (see Selve a/p R Renganathen (supra)). [75] Further, as NJTO is a third party, I maintain the same position that I had taken in respect of the discovery of documents of other third parties, namely the SOVB Entities and PTTO, which is that an order for discovery cannot be justified as the documents are not in the possession of the plaintiffs (see Yekambaran Marimuthu (supra)). Item 8 of Annexure A: Documents referred to in the EY Report [76] The documents for which discovery is sought under this heading, which are set out in item 8 of Annexure A are as follows: “8.1. All electronically stored information in its native format (i.e. *.pst, *.docx, *.xlsx, *.ppt, etc) that were accessed by the Plaintiffs’ expert that is the 4,484 emails/ files reviewed by the Plaintiffs’ expert as stated in the Plaintiffs’ Expert Report” [77] The 1st to 3rd defendants did not provide any explanation as to why these documents are relevant and necessary for the fair disposal of this action. The only reasons provided by them to seek discovery of these documents are that the documents are required to check for gaps in EY’s investigation process, and to ensure that a fair and independent investigation was conducted. I find these reasons to be unconnected to the issues in dispute in this action, and do not therefore justify the grant of a discovery order over the documents. [78] With no explanation given on the relevance and necessity of the documents, and with such a wide range of documents being sought, the 1st to 3rd defendants’ attempt to seek discovery over these documents tantamounts to a fishing expedition, and an abuse of the process of the court.

[79] Having considered the documents listed in Annexure A of the Discovery Application, I found that they do not meet the test of relevance and necessity, that would justify the grant of an order for discovery over them. Further, some of the documents as highlighted are described in too general a manner, that granting a discovery order over them would be oppressive on the plaintiffs. [80] I also considered the documents in light of my earlier finding that there had been an inordinate delay in the filing of the Discovery Application. Where there has been a delay in the filing of an application for discovery, in addition to ensuring that the test for discovery has been met, the court must also consider the implications of allowing discovery to the proceedings overall, including to the preparation for trial. In this case, allowing the Discovery Application will hinder trial preparations and delay the trial. [81] For these reasons, the court dismissed the Discovery Application, with costs. Dated 28 February 2025 ADLIN ABDUL MAJID Judge High Court of Malaya Kuala Lumpur Counsel: Plaintiffs : Yee Mei Ken (together with Caitlin Tan and Ng Ee Min) of Messrs. Shearn Delamore & Co 1st to 3rd defendants : Mathew Thomas Philip (together with Voon Su Huei) of Messrs. Thomas Philip