Affin Bank Berhad v Brunsfield Corporation Sdn Bhd (BA-28NCC-659-10/2024)

This is the Petitioner's application to wind up Brunsfield Corporation Sdn Bhd ("the Respondent") pursuant to sections 465(1)(e) and 466(1)(a) of the Companies Act 2016 (“CA 2016”). Page 1 of 6 S/N BuEnr9rPbOugCAoi1calU4w ;

After hearing the parties, | allowed the winding-up petition. The Respondent has since filed an appeal to the Court of Appeal. These are my written grounds. Background Facts

On 5 February 2024, the Petitioner obtained a judgment in Civil Suit No. WA-2NCC-24-01/2024 against the Respondent in the sum of RM43,589,572.55 together with interest and costs.

Astatutory notice dated 5 July 2024 pursuant to section 466(1)(a) CA 2016 was issued, demanding payment within 21 days. The Respondent failed to comply with this notice.

The winding-up petition was presented on 23 October 2024. The Affidavit Verifying Petition was filed on 28 October 2024.

The Registrar's Certificate was issued on 9 December 2024. The Respondent filed an affidavit in opposition on 27 January 2025. Issues

The issues that arose for determination were: (a) Whether the Petition is defective due to the Affidavit Verifying Petition being filed after the prescribed time under Rule 26 of the Companies (Winding-Up) Rules 1972. (b) Whether there exists a bona fide dispute on substantial grounds in respect of the judgment debt. Page 2 of 6 S/N BuEnr9rPbOugCAoicalU4w ; (c) Whether the Petition constitutes an abuse of court process in light of pending foreclosure proceedings and the Respondent's alleged solvency. Analysis and Findings (a) Compliance with Rule 26 ~ Affidavit Verifying the Petition

The Respondent objected to the Petition on the ground that the Affidavit Verifying Petition was filed out of time, in breach of Rule 26 of the Companies (Winding-Up) Rules 1972. That rule requires the verifying affidavit to be sworn after and filed within four days after the presentation of the winding-up petition.

In this case, the Petition was presented on Wednesday, 23 October 2024. Accordingly, the fourth day fell on Sunday, 27 October 2024, which is a non-working day in Selangor and Kuala Lumpur.

The affidavit was filed on the next available working day, namely Monday, 28 October 2024. | accepted the Petitioner's explanation that the delay was occasioned not by neglect or indifference, but by the Court's electronic filing system (EFS), which had not processed or sealed the Petition until 28 October 2024. It was only upon such processing that the system permitted the Petitioner to proceed with the filing of the verifying affidavit.

!n my view, the brief delay was both justified and excusable. There was no indication of mala fides or an attempt to circumvent the rules. Furthermore, the Respondent did not demonstrate that it had suffered any prejudice as a result of the timing of the affidavit. In any event, the Court Page 3 of 6 S/N BuEnr9rPbOugCAoi1calU4w ; retains the power to enlarge time under Rule 193, and to disregard formal defects or irregularities under Rule 194(1), provided no substantial injustice has been caused. | was therefore satisfied that the non- compliance, if any, was procedural in nature, did not affect the substance of the Petition, and was curable under the Court’s inherent jurisdiction. (b) Existence of a Bona Fide Dispute

The Respondent did not challenge the underlying judgment by setting it aside or appealing it. The existence of the judgment is prima facie evidence of the debt, as held in Sri Hartamas Development v MBF Finance [1992] 1 MLJ 313.

Allegations of fraud, misrepresentation, or set-off were not raised in the judgment suit and were not supported by cogent evidence. The affidavit in opposition did not meet the high threshold required to show a bona fide dispute of substance. As reaffirmed in Klass Corp (M) Sdn Bhd v MKRS Management Sdn Bhd [2018] 9 MLJ 305, a mere assertion of dispute is insufficient without particulars and documentary support. (c) Abuse of Process and Solvency Argument

The Respondent also argued that the Petition was an abuse of process as foreclosure proceedings were pending and that it remained a solvent company with valuable assets.

| found this unpersuasive. The statutory notice under section 466(1)(a) is a presumption of insolvency upon non-compliance. The Petition is grounded on a final judgment. The Respondent failed to make any payment or propose a settlement. There was no credible evidence of Page 4 of 6 S/N BuEnr9rPbOugCAoi1calU4w ; liquidity or ability to satisfy the debt. The existence of ongoing foreclosure proceedings does not bar a winding-up action. As held in RHB Bank vy Malaysia Pacific Corporation [2018] 6 CLJ 55, a company’s solvency must be shown by its ability to pay debts as they fall due, not merely on paper. Conclusion

For the reasons above, | allowed the winding-up petition with costs. The Petitioner has proven the statutory presumption of insolvency under section 466(1)(a), and the Respondent failed to rebut it with evidence ofa bona fide dispute or solvency.

The procedural objection regarding the Affidavit Verifying Petition is without merit and does not invalidate the Petition.

{18] Awinding-up order is therefore granted against the Respondent with costs of RM5, 000.00 awarded to Petitioner. Dated: 5 May 2025 Ce v4 RAJA ROZELA BINTI RAJA TORAN Judicial Commissiorjer Muamalat and Insolvency Court Page 5 of 6 S/N BuEnr9rPbOugCAoi1calU4w ; COUNSEL Solicitors for the Petitioner Tetuan Sidek Teoh Denise & Wong Level 16, Menara Bumiputera- Commerce, No 11, Jalan Raja Laut 50350 Kuala Lumpur Solicitors for the Respondent Tetuan C.M Wong & Denise Chong Unit C-22-9 (Colonial Tower), Empire City Damansara Jalan Damansara, PJU 8 47820 Petaling Jaya Selangor Page 6 of 6 S/N BuEnr9rPbOugCAoi1calU4w ;