Augustine A/L T.K. James v 1. ) Liew Chong Min (WA-28PW-218-08/2021)

LIEW CHONG MIN

NG TUCK WENG

MESSRS WONG & TING …RESPONDENTS S/N W9ztLY6RxkGbj4v4heZiw AUGUSTINE JAMES A/L TK JAMES (LIQUIDATOR FOR BEGAN CONSTRUCTION SDN BHD) COMPANY NO: 199701009535 (425031-W) …APPLICANT Heard together with BAHAGIAN DAGANG KES PASCA PENGGULUNGAN NO. WA-28PW-218-08/2021 In the matter of Winding Up Order dated 8.12.2017 against Began Construction Sdn Bhd (Company No: 425031-W) And In the matter of Sections 472 and 541 of the Companies Act 2016 And In the matter of Rule 7 of the Winding Up Rules 1971 LIM WEE NGEH PAINTING SDN BHD (COMPANY NO: 672847-A) S/N W9ztLY6RxkGbj4v4heZiw

LIEW CHONG MIN

NG TUCK WENG

TAN KINV TAT (FORMERLY PRACTISING AS MESSRS KINV LAW OFFICE) …RESPONDENTS AUGUSTINE JAMES A/L TK JAMES (LIQUIDATOR FOR BEGAN CONSTRUCTION SDN BHD) COMPANY NO: 199701009535 (425031-W) …APPLICANT And also Heard together with BAHAGIAN DAGANG KES PASCA PENGGULUNGAN NO. WA-28PW-352-12/2021 In the matter of RM1,965,872.09 of Began Construction Sdn. Bhd. (Company No: 425031-W) (In Liquidation) And S/N W9ztLY6RxkGbj4v4heZiw In the matter of Sections 472 of the Companies Act 2016 And In the matter of Rules 5 and 7 of the Companies (Winding-Up) Rules 1972 And In the matter of Order 15 Rule 16 of the Rules of Court 2012 And In the matter of Order 92 Rule 4 of the Rules of Court 2012 LIM WEE NGEH PAINTING CONSTRUCTION SDN BHD (NO SYARIKAT: 672847-A) BEGAN CONSTRUCTION SDN BHD (COMPANY NO: 199701009535(425031-W) …RESPONDENT GROUNDS OF JUDGMENT (Enclosure 1)

In the Kes Pasca Penggulungan No. WA-28PW-217-08/2021 (PW 217), Augustine James A/L TK James as the Liquidator (Applicant) for Began Construction Sdn Bhd (Company) had applied to this Court vide a Notice of Motion in enclosure 1 thereto and pursuant to sections 472 and 541 of the Companies Act 2016 for the following reliefs:-

1.1 A declaration that the disposition of the sum of RM329,081 from the Settlement Sum of RM700,000.00 received by the Third Respondent as an Advocates & Solicitors who had acted for a Company named Began Construction Sdn Bhd (In Liquidation) (Company No: 199701009535(425031-W) in a matter known as AA-22NCvC-78-05/2016 against Keris Engineering & Communications Sdn Bhd, the Third Respondent on the instructions of the First and Second Respondent, the present Directors and/or officers of the Company, after the presentation of the Winding Up Petition on 5.10. 2017 are void under Section 472 of the Companies Act

The First and Second Respondent had instructed the Third Respondent to pay and/or advance the following monies: a) in paying and/or advancing a sum of RM115,000.00 of the Company’s money to Heap Wah Enterprise Sdn Bhd on 30.10.2017 b) in paying an/or advancing a sum of RM62,281.71 of the Company’s money to Messrs. Wong & Ting, Advocates & Solicitors, the Third Respondent on the 30.10.2017 c) in paying and/or advancing a sum or RM26,800.00 of the Company’s money to Messrs. Wong & Ting, Advocates & Solicitors, the Third Respondent on the 14.11.2017 S/N W9ztLY6RxkGbj4v4heZiw d) the Third Respondent issued a Maybank Islamic Bankers’ Cheque (496371) for RM125,000.00 to the Petitioner, Lim Wee Ngeh Painting Construction Sdn Bhd as Partial Settlement but the Petitioner had rejected the payment. The Third Respondent to account and to be held responsible and liable for the sum of RM125,000.00.

1.2 An Order that the First Respondent, Liew Chong Min (NRIC No. 690717-08-5517) and the Second Respondent, (NRIC No. 600213-08-5693) and the Third Respondent do, jointly and/or severally pay to the Company and/or the Liquidator of the Company the abovementioned sums amounting to RM115,000.00 as listed above and/or any other amount which this Honourable Court deems fit an proper, together with interest at the rate of 5% per annum from 5.10.2017 until the date of full payment.

1.3 An Order that the Third Respondent, Messrs. Wong & Ting to return and/or to pay to the Company and/or the Liquidator of the Company the sum of RM214,081.71 mentioned above and/or any other amount which this Court deems fit and proper, together with interest at the rate of 5% per annum from 5.10.2017 until the date of full payment.

The grounds for PW 217 are as follows:- a) The date of presentation of Winding Up Petition of the Company was on 5.10.2017. S/N W9ztLY6RxkGbj4v4heZiw b) The Directors of the Company had instructed Messrs. Wong & Ting to make certain payments from the settlement sum of RM700,000.00 received by the Third Respondent as Advocates & Solicitors for the Company from their Client’s Account after the date of presentation of Winding Up Petition which is in contravention of Sections 472 and 541(1) of the Companies Act

The Directors have committed and/or guilty of misfeasance and/or acted in breach of their trust and/or duty to the Company. c) The Third Respondent Messrs. Wong & Ting, a firm of Solicitors representing the Company had full knowledge of the presentation of the Winding Up Petition against the Company. The Third Respondent should have been aware of the legal implication and the consequences of paying to themselves, the Firm of Solicitors, a creditor, in full thereby securing the Firm and advantage over the rest of creditors The Third Respondent had been negligent and committed a serious breach of duty and breach of trust to the Company for failing to advice the First and the Second Respondents against the making of payment and/or advance to themselves and to the other creditor. d) at all material time the settlement sum of RM700,00.00 was in the

The Third Respondent were in control of the settlement sum and the Third Respondent had failed to observe the Solicitor-Client relationship but instead took advantage by taking money for themselves thereby securing their interest over the rest of the creditors. e) The Third Respondent were negligent for failing to ensure that the offered partial settlement sum of RM125,000.00 which was paid to the Petitioner was actually accepted by the Petitioner. Till today S/N W9ztLY6RxkGbj4v4heZiw the sum of RM125,000.00 which ought to have been released to the Company and or to the Liquidator but the Third Respondent had failed to do so. f) The Liquidator is unable to verify the purpose of the payments with documentary evidence. g) The payments made from the settlement sum of RM700,000.00 amounts to void dispositions of the Company’s property because the payments were made after the presentation of the Winding Up Petition and/or also amounting to undue preference over the company’s creditors.

In Kes Pasca Penggulungan No. WA-28PW-218-08/2021 (PW 218), the Applicant as Liquidator for the Company had this time applied to this Court vide Enclosure 1 thereto and pursuant to sections 472 and 541 of the Companies Act 2016 for the following reliefs:-

3.1 A declaration that the disposition of large sum of RM1,636,790.38 from the total Sum of RM1,778,985.96 payment received under the Adjudication Decision dated 21.8.2017 by the Third Respondent as an Advocate & Solicitor who had acted for a company named Began Construction Sdn Bhd (In Liquidation) in a matter known as Adjudication Reference No. KLRCA/D/0851-2017 against Keris Engineering & Communications Sdn Bhd, the Third Respondent on the instruction of the First and Second Respondent, the present Directors and/or officers of the Company after the presentation of the Winding Up Petition on the 5.10.2017 are void under Section 472 of the Companies Act 2016. The First and Second Respondent had instructed S/N W9ztLY6RxkGbj4v4heZiw the Third Respondent to pay and/or advance the following monies to the Creditors and to the Third Respondent himself: a) In paying and/or advancing a sum RM100,036.00 of the Company’s money to The Law Chambers of Tan Kinv Tat, Advocates & Solicitors, the Third Respondent on the 13.11.2017. b) In paying and/or advancing a sum of RM5,000.00 of the Company’s money to the The Law Chambers of Tan Kinv Tat, Advocates & Solicitors, the Third Respondent on the 24.11.2017. c) In paying and/or advancing a sum of RM440,000.00 of the Company’s money to SJEEE Engineering Sdn Bhd on 31.10.2017. d) In paying and/or advancing a sum of RM20,000 of the Company’s money to Optad Marketing Sdn Bhd on the 31.10.2017. e) In paying and/or advancing a sum of RM120,000.00 of the Company’s money to QST Solutions Sdn Bhd on the 31.10.2017. f) In paying and/or advancing a sum of RM90,000.00 of the Company’s money to Perkasa Solaris Sdn Bhd on the 13.11.2017. g) In paying and/or advancing a sum of RM68,419.30 of the Company’s money to Soon Hin Hardware Sdn Bhd on the 13.11.2017. h) In paying and/or advancing a sum of RM66,203.98 of the Company’s money to Mega Tyre & Car Services on the 13.11.2017. S/N W9ztLY6RxkGbj4v4heZiw i) In paying and/or advancing a sum of RM50,000.00 of the Company’s money to Ng Sin Yee on the 24.11.2017. j) In paying and/or advancing a sum of RM67,331.10 of the Company’s money to Messrs. Ferida, Hassan, Low & Ng on the 24.11.2017. k) In paying and/or advancing a sum of RM100,000.00 of the Company’s money to Ng Chee Meng on the 24.11.2017. l) In paying and/or advancing a sum of RM40,000.00 of the Company’s money to Yik Seong Trading Sdn Bhd on the 24.11.2017. m) In paying and/or advancing a sum of RM170,000.00 of the Company’s money to Public Bank Berhad on the 24.11.2017. n) In paying and/or advancing a sum of RM49,800.00 of the Company’s money to Ng Chee Siong on the 24.11.2017. o) In paying and/or advancing a sum of RM250,000.00 of the Company’s money to Perkasa Solaris Sdn Bhd on the 13.11.2017.

3.2 An Order that the First Respondent Liew Chong Min (NRIC No. 690717-08-5517) and the Second Respondent, Ng Tuck Weng (NRIC No. 600213-08-5693) and the Third Respondent do, jointly and/or severally pay to the Company and/or the Liquidator of the company the abovementioned sums amounting to RM1,531,754.38 as listed above and/or any other amount which this Court deems fit and proper, together with interest at the rate of 5% per annum from 5.10. 2017 until the date of full payment.

3.3 An Order that the Third Respondent, Tan Kinv Tat to return and/or to pay to the Company and/or the Liquidator of the Company the sum of RM105,036.00 mentioned above and/or any other amount which this Court deems fit and proper, together with interest at the rate of 5% per annum from 5.10.2017 until the date of full payment.

The grounds for PW 218 are as follows:- a) The date of presentation of Winding Up Petition of the Company was on the 5.10.2017. b) The Directors of the Company had instructed Tan Kinv Tat formerly practising as a sole proprietor under the name and sty knows as The Law Chambers of Tan Kinv Tat to make payments to the creditors and to the Third Respondent from the sum of RM1,778,985.00 received as Adjudication Decision by the Third Respondent as Advocates & Solicitors for the Company from the Third Respondent’s Client’s Account after the date of presentation of Winding Up Petition which is in contravention of Sections 472 and 541(1) of the Companies Act 2016. The Directors have committed and/or guilty of misfeasance and/or acted in breach of their trust and/or duty to the Company. c) Tan Kinv Tat, was practising under the name and style of Law Chambers of Tan Kinv Tat, Advocate & Solicitor representing the Company during the said period had full knowledge of the presentation of the Winding Up Petition against the Company. The Third Respondent should have been aware of the legal implication and the consequences of paying the then Firm of Solicitor, Law Chambers of Tan Kinv Tat and other creditors, in full thereby S/N W9ztLY6RxkGbj4v4heZiw securing the then Legal Firm and number of creditors an advantage over the rest of the creditor. The Third Respondent had been negligent and committed a serious breach of duty and breach of trust to the Company for failing to advice the Firs and the Second Respondents against the making of payments and/or advances to themselves and to the other creditors. d) At the material time the sum of RM1,778.985.96 received from the Adjudication decision was in the Third Respondent’s Hong Leong Bank Client’s Account No: 19100032395. The Third Respondent was in control of the sum received from the Adjudication Decision and the Third Respondent had failed to observe the Solicitor-Client relationship but instead took advantage by taking money for himself and pay to some of the creditors thereby securing their interest over the rest of the creditors. e) The Liquidator is unable to verify the purpose of the payments with documentary evidence. f) The payments made a mount to void dispositions of the Company’s property because the payments were made after the presentation of the Winding Up Petition and/or also amounting to undue preference over the Company’s creditors.

Finally, in Post Winding Up No. WA-28PW-352-12/2021 (PW 352), one Liew Chong Ming (Liew) had applied to this Court pursuant to section 472 of the Companies Act 2016 and/or Order 15 Rule 16 of the Rules of Court 2012 and/or the inherent jurisdiction of the Court for the following orders:-

5.1 a declaration that the following disposition of monies by Began Construction Sdn Bhd (Company No. 425031-W) (In S/N W9ztLY6RxkGbj4v4heZiw Liquidation) via Messrs. Wong & Ting, its solicitors at the material times, are legal and valid notwithstanding that a Winding Up Petition has been presented against the Company on 5.10.2017:- a) the payment and/or advancement of the sum of RM115,000.00 to Heap Wah Enterprise Sdn Bhd on 30.10.2017; b) the payment and/or advancement of the sum of RM62,281.71 to Messrs Wong & Ting, Advocates & Solicitors on 30.10.2017; c) the payment and/or advancement of the sum of RM26,800.00 to Messrs Wong & Ting, Advocates & Solicitors on 14.11.2017; and d) the issuance of a Maybank Islamic Banker’s Cheque (Cheque No. 496371) by Messrs Wong & Ting, Advocates & Solicitors for RM125,000.00 to the abovenamed Petitioner, Lim Wee Ngeh Painting Construction Sdn Bhd (Company No. 672847-A) on 6.11.2017.

5.2 a declaration that the following disposition of monies by Began Construction Sdn Bhd (Company No. 425031-W) (In Liquidation) via Messrs. Kinv Law Office, its solicitors at the material times, are legal and valid notwithstanding that a Winding Up Petition has been presented against the Company on 5.10.2017:- a) the payment and/or advancement of the sum of RM100,036.00 to The Law Chambers of Tan Kinv Tat on 13.11.2017; S/N W9ztLY6RxkGbj4v4heZiw b) the payment and/or advancement of the sum of RM5,000.00 to The Law Chambers of Tan Kinv Tat on 24.11.2017; c) the payment and/or advancement of the sum of RM440,000.00 to SJEE Engineering Sdn Bhd on 31.10.2017; d) the payment and/or advancement of the sum of RM20,000.00 to Optad Marketing Sdn Bhd on 31.10.2017; e) the payment and/or advancement of the sum of RM120,000.00 to QST Solutions Sdn Bhd on 31.10.2017; f) the payment and/or advancement of the sum of RM90,000.00 to Perkasa Solaris Sdn Bhd on 13.11.2017; g) the payment and/or advancement of the sum of RM68,419.30 to Soon Hin Hardware Sdn Bhd on 13.11.2017; h) the payment and/or advancement of the sum of RM66,203.98 to Mega Tyre & Car Services on 13.11.2017; i) the payment and/or advancement of the sum of RM50,000.00 to Ng Sin Yee on 24.11.2017; j) the payment and/or advancement of the sum of RM67,331.10 to Messrs Ferida, Hassan, Low & Ng on 24.11.2017; k) the payment and/or advancement of the sum of RM100,000.00 to Ng Chee Meng on 24.11.2017; l) the payment and/or advancement of the sum of RM40,000.00 to Yik Seong Trading Sdn Bhd on 24.11.2017; m) the payment and/or advancement of the sum of RM170,000.00 to Public Bank Berhad on 24.11.2017; S/N W9ztLY6RxkGbj4v4heZiw n) the payment and/or advancement of the sum of RM49,800.00 to Ng Chee Siong on 24.11.2017; o) the payment and/or advancement of the sum of RM250,000.00 to Perkasa Solaris Sdn Bhd on 13.11.2017.

5.3 Alternatively, a declaration that any of the dispositions in paragraph 2 and/or paragraph 3 above are valid as this Honourable Court thinks fit.

All the above matters were with the consent of all learned counsels for the respective parties heard together as it involved the same set of facts and the same subject company.

A Winding Up Petition (Petition) was presented against the Company by the Petitioner on 5.10.2017 and the Company was wound up on 8.12.2017.

The Liquidator was subsequently appointed pursuant to a Court order dated 11.11.2019 to replace the Official Receiver as the liquidator of the Company.

After taking over the conduct of the Company from the Official Receiver, the Applicant had sent notices to the Directors and the Company Secretary to provide further documents to complete the Statement of Affairs and to surrender all the books and records but were not avail as the First and Second Respondents failed to cooperate.

The Applicant on his own accord compiled some information from the available documents and records from the Company’s abandoned office at No. 20 Jalan Ria 4, Kawasan Perindustrian Ria, 43000 Kajang, Selangor Darul Ehsan.

The Applicant had discovered evidence of misfeasance and irregularities in respect of payments received and payments made by the Respondents. The Respondents had misapplied the Company’s monies thereby constituting void disposition and therefore the Respondents shall be made liable or accountable for the monies belonging to the Company released to Third Party or guilty of misfeasance or breach of trust or duty in relation to the Company.

The Applicant through his Solicitors Messrs S.Mathavan & Nur Hafizah (the “said solicitors”) obtained information from Messrs C.K.Leong about a suit filed by the Company against Keris Engineering Sdn Bhd (Suit No: AA-22NCVC-78-05/2016) whereby the suit was withdrawn pursuant to a Settlement Agreement dated 23.10.2017.

The Third Respondent who had acted for the Company in abovementioned suit, received the settlement sum of RM700,000.00 vide letter dated 23.10.2017, para 2 of the letter reads as follows: “2. We enclose herewith our client’s PBB Cheque (No. 355735) for the sum of RM700,000.00 being full and final payment for all projects between your client and our client and its associated companies together with the (2) original ‘Settlement Agreement’ duly executed S/N W9ztLY6RxkGbj4v4heZiw by our client and affixed with their common seal.’

The Third Respondent by their letter dated 11.6.2021 had given accounts for the RM700,000.00 to the said Solicitors supported by documentary evidence.

The Applicant avers as below the payments made by the Third Respondent on the instruction of the First and Second Respondents. These were confirmed by the Third Respondent vide their letter dated 11.6.2021 to the said Solicitors: - NO DATE RECIPIENT AMOUNT (RM) 1 06.11.2017 LIM WEE NGEH PAINTING CONSTRUCTION SDN BHD 125,000.00 2 30.10.2017 RELEASED TO THE COMPANY 316,000.0 3 08.11.2017 HEAP WAH ENTERPRISE SDN BHD 115,000.00 4 30.10.2017 LEGAL FEES PAID TO THE THIRD RESPONDENT 62,281.71 5 14.11.2017 LEGAL FEES PAID TO THE THIRD RESPONDENT 26,800.00 6 29.11.2017 RELEASED TO THE COMPANY 54,906.63

The 1st Respondent in PW 217, Liew Chong Min (Liew) and the 2nd Respondent therein, Ng Tuck Weng (Ng) are directors of the Company whereas the 3rd Respondent, Messrs. Wong & Ting (W&T) are a firm of advocates and solicitors.

Ng has not filed any affidavit in respect of PW 217 whilst W&T have opposed PW 217.

It was submitted by the Applicant / Liquidator that Liew had stated that the dispositions were done reasonably and in good faith or bona fide for the benefit of the Company and were beneficial to the general body of creditors. The Applicant / Liquidator contended that these were a futile effort to justify payments made to a third party and to

The Applicant / Liquidator had also inter alia submitted that;

19.1 the transactions done by M&T on the instructions of Ng & Liew were made in contravention of the law and therefore not made in the best interest and benefit of the Company 19.2 such payments amount to misapplication of the Company’s fund and undue. Preference over the creditors of the Company 19.3 such payments are a void disposition 19.4 Ng, Liew and W&T had knowledge of the winding up and are liable to repay to the Company or the Liquidator the following (Said Payments) a) the sum of RM125,000 from Malayan Banking Berhad b) the sum of RM115,000 released to Heap Wah Enterprise Sdn Bhd, c) the sum of RM89,081.71 paid to W&T as legal fees 19.5 the Payments to TKT, which will be referred to below in my grounds, and payments made out therein were also made in contravention of the law

Liew had submitted amongst others that the key director of the Company prior to its liquidation was Ng who was the one responsible for the daily affairs of the Company, whereas Liew was merely managing project and/or work sites outside the Company for the Company and was at all material times not involved in managing the Company’s day to day affairs.

It was further submitted by Liew amongst others that:-

he had no knowledge and was unaware of the Winding Up Petition (Petition)

he had only on 19.12.2017 received a notice to attend the First Meeting of Creditors and Contributories from the Official Receiver informing him that a Winding Up Order had been made against the Respondent on 8.12.2017 and immediately tried to contact Ng but to no avail

he had subsequently filed PW 352 for a validation order

Liew being the officer of the Company is guilty of misfeasance and had acted in breach of trust and/or duty in dealing with the Company’s properties after the presentation of the Petition and should be held personally liable and be ordered to restore and pay the Applicant such monies and/or properties which were unlawfully disposed

W&T had submitted amongst others that:-

22.1 it had been retained by the Company to act on its behalf in suit no. AA-22NCVC78-05/2016 (78 Suit) against

Engineering & Communications Sdn Bhd (KEC) as well as in other disputes against KEC 2 the 78 Suit was subsequently settled and KEC agreed to enter into a Settlement Agreement dated 23.10.2017 22.3 they deny that the said payments amounting to RM7000,000 (Said Payments) were done in contravention of the law and/or were not in the Company’s best interest 22.4 the Said Payments cannot have been misapplied by W&T when the entire sum was used to pay the Company’s debts with the balance returned to the Company. Findings of the Court

Section 472 (1) of the Companies Act 2016 provides;

Any disposition of the property of the company, other than an exempt disposition, including any transfer of shares or alteration in the status of the members of the company made after the presentation of the winding up petition shall, unless the Court otherwise orders, be void.

Whereas Section 541 of the Companies Act 2016 states:

If in the course of winding up it appears that: S/N W9ztLY6RxkGbj4v4heZiw

any person who has taken part in the formation or promotion of the company; or

any past or present liquidator or officer, has misapplied or retained or become liable or accountable for any money or property of the company or been guilty of any misfeasance or breach of trust or duty in relation to the company, the Court may, on the application of the liquidator or of any creditor or contributory examine into the conduct of that person, liquidator or officer and compel him to repay or restore the money or property or any part of the money with interest at such rate as the Court thinks just, or to contribute such sum to the assets of the company by way of compensation in respect of the misapplication, retainer, misfeasance or breach of trust or duty as the Court thinks just.

In relation to Section 472 (1) of the Companies Act 2016, it is settled law, and I only need to rely on and humbly adopt Mohd Nalzan JC ( A s His Lordship then was) in CIMB Bank Berhad v Jaring Communications Sdn Bhd [2016] MLJU 920 where His lordship had held: “[44] The law as encapsulated in Section 223 is clear in that upon the presentation of a winding up petition, a company cannot without the order of the Court dispose of its property in whatever form and by whatever means. This is to prevent the improper dissipation of the company’s assets before the winding up petition is heard and determined. In the instant case, the winding up petition was presented on 6 November 2014 by the Petitioner and as the key director of the Company, Dato’ Norhisam must surely have been aware that the petition had been presented. Yet he still deemed it S/N W9ztLY6RxkGbj4v4heZiw proper for various payments be made post the date of the petition, and there is no evidence that any of such payments has been validated by the Courts. As such, it is clear that all the payments made after the commencement of winding up was void by virtue of section 223 of the CA.”

This Court further makes reference to the Court of Appeal case of Azabar Holdings Sdn Bhd (In Liquidation) v Kumarappan @ Thannirmalai a/l KM Palaniappan [2021] 3 MLJ 448: “[37] As for the effect and consequences of a contravention of s 223 of the CA 1695 (the previous provision for Avoidance of Disposition of Property under the Companies Act 1965) , we think that it is highly relevant to refer to In re AI Levy (Holdings) Ltd [1964] Ch 19 where Buckley J (an obvious authority in company law jurisprudence) examined the equivalent section under English company law and said: It appears to me that the object of the section is to protect the interests of the creditors from the possibly unfortunate results which would ensue from the presentation of a petition, and to protect their interests as much during the period while the petition was pending as after an order has been made on it. What the section provides in its present terms is that any disposition of the property of the company made after the commencement of the winding up shall be void in the winding up of the company unless the court otherwise orders; that is to say, if and when the company comes to be put into liquidation the transaction is to be as if it had never taken place. (Emphasis added.)”

Thus, the principle that can be derived from the aforesaid cases, is that it is trite that any disposition of the property of the Respondent S/N W9ztLY6RxkGbj4v4heZiw company made after the commencement of the winding up shall be void and the Respondent cannot without the order of the Court dispose of its property in whatever form and by whatever means.

From the documents in PW 217 & 218 before this Court, Ng has failed to reply to any assertions made against him and thus he would be deemed to have admitted such assertions made against him by the Applicant / Liquidator, see the authority of Ng Hee Thong & anor v Public Bank Berhad [1995] 1 MLJ 281 where it was held by the Court of Appeal that:- “Now, it is a well settled principle governing the evaluation of affidavit evidence that where one party makes a positive assertion upon a material issue, the failure of his opponent to contradict it is usually treated as an admission by him of the fact so asserted: Alloy Automotive Sdn Bhd v Perusahaan Ironfield Sdn Bhd [1986] 1 MLJ 382; Overseas Investment Pte Ltd v Anthony William O'Brien &

The application of this above said principle will for the purpose of the matters before me be subject to my decision herein and this Court’s decision on Ng’s ultimate liability if any.

I will firstly deal with Ng & W&T and shall touch on payments made to Messrs The law Chambers of Tan Kinv Tat (TKT) in my grounds on PW 352 below. It is in evidence, as per W&T’s letter dated 11.6.2020 in exhibit AJ-11 of enclosure 2, that W&T had on the instructions of the Company signed on the letterhead of the Company by Ng and Liew, released the sum of RM700,000 as solicitors for the

the Company the sum of RM370,906.63

(ii) a third party by the name of Heap Wah Enterprise Sdn Bhd, the sum of RM115,000 on 8.11.2017

(iii) deduction of W&T’s legal fees of RM89,081.71

(iv) the Petitioner the sum of RM125,000 as partial settlement to the Petitioner but the same was rejected by the Petitioner as per the letters dated 18.5.2020 and 27.5.2020 as well as 3.6.2020 in exhibit AJ-2 and AJ-7 of enclosure 2 respectively

The above fact is also supplemented vide the documentary evidence of various letters dated 27.10.2017, 30.10.2017, 9.11.2017,

14.11.2017, 29.11.2017 respectively which can be found in exhibit AJ- 12 of enclosure 2.

It is further in evidence and it is undisputed that:-

there has been no validation orders from any Court as to the above said payments

(ii) the sum of RM125,000 has been transferred to the Registrar of Unclaimed Monies in the year 2018 as per the letter from Messrs Ranjit Singh & Yeoh, solicitors for W&T, dated 26.4.2021 in exhibit AJ-19 of enclosure 2 enclosing an email dated 25.3.2021 from Malayan Banking Berhad.

I have also examined:

the Judgment dated 8.8.2017 in Shah Alam Magistrate’s Court Civil No. BA-A72NCC-737-03/2017 (Judgment dated 8.8.2017), S/N W9ztLY6RxkGbj4v4heZiw the Company’s letter dated 30.10.2017 signed by both Liew and Ng and W&T’s letter dated 30.10/2017 in exhibit LCW -1 of enclosure 32, which I find from a balance of probabilities show that the payment to Heap Wah Enterprise Sdn Bhd was in compliance with the Judgment dated 8.8.2017

(ii) W&T’s Professional Charges dated 30.10.2017 and the Respondents letter dated 14.11.2017 in exhibit LCW -2 of enclosure 32

(iii) the Company’s letter dated 27.10.2017 again signed by both Liew and Ng addressed to W&T instructing the disbursement of the said RM125,000 to the Petitioner, and a MBB Bankers Cheque No. 047312 dated 6.11.2017 (MBB Bankers Cheque) in exhibit LCW -3 of enclosure 32

(iv) the Settlement Agreement dated 23.10.2017 between KEC and the Company at exhibit AJ-9 of enclosure 2 wherein pursuant thereto the sum of RM700,000 had been forwarded by KEC to W&T

I find from the above evidence before this Court that:-

34.1 the creditors of the Company are indeed authentic creditors of the Company 34.2 W&T was retained to act for the Company against KEC and various other parties which work included 2 adjudication proceedings against Keris Properties Holdings Sdn Bhd and KEC respectively as well as in a suit involving the Petitioner vide Shah Alam High Court Suit No. BA-22NCVC-515- 09/2017 (515 Suit) including an application for a Fortuna Injunction which was then transferred to the Sessions Court S/N W9ztLY6RxkGbj4v4heZiw after which W&T were then subsequently discharged by the Company and thus had no knowledge as to what transpired in the 515 Suit as averred to in paragraph 6 of their affidavit in enclosure 41.

Following from the above, it is also my finding that the payments to W&T for their fees were for the litigation work done by them as seen in the invoices in exhibit WT-1 of enclosure 41 and that the same was done bona fide.

With regards the issue of the missing or misplaced MBB Bankers Cheque, I find from the evidence of a letter dated 27.5.2020 from the Petitioner’s solicitors, Messrs Ho-Noecker & Prasagam addressed to the Liquidators solicitors at exhibit AJ-2 in enclosure 2 that the same was returned by Messrs Ho-Noecker & Prasagam to the Company and that W&T had thereafter sought for Malayan Banking Berhad to reissue a fresh bankers cheque but was informed by Malayan Banking Berhad that the monies had been transferred to the Registrar of Unclaimed Monies as per exhibit AJ-19 in enclosure 2. I therefore hold that in the circumstances, W&T cannot be faulted for the said missing or misplaced MBB Bankers Cheque.

After due consideration of all of the evidence before me, I find that Liew only knew of the Winding Up order after receiving on 19.12.2017, the Notice to Attend the First Meeting of Creditors and Contributories. I also find that W&T have also proven to my satisfaction that they did not know of the Petition as there is no evidence from the Liquidator to credibly contradict this fact. From the evidence I am also further satisfied that both Liew and/ or W&T had no involvement in the S/N W9ztLY6RxkGbj4v4heZiw Petition as the Winding Up Order dated 8.12.2017 was entered in the absence of the presence of the Company on that day as can be seen in the Winding Up Order itself in exhibit R-2 of enclosure 6.

As this Court had made a finding that Liew as well as W&T had no knowledge of the Petition, and as the monies were due and owing at the material times to the said creditors of the Company; it is only to be expected that the dispositions were in the course of the Company’s ordinary trade and done in good faith i.e bona fide.

From this I hold that the said dispositions were made to have benefitted the Company’s general body of creditors. Authority for this can be found in the case of BSN Commercial Bank (M) Berhad v River View Properties and anor action [1996] 4 MLRH 485 which has held that: “[17] Dispositions are said to be void under s 223 of the Companies Act 1965 'unless the Court otherwise orders'. [18] Thus, each case must be approached and dealt with on its own facts and circumstances. No two cases are the same. It revolves on the good faith and honesty of the personalities, and it is here that the judge's common sense opinion of what is just and fair prevails: Re Steane's (Bournemouth) Ltd [1950] 1 All ER 21 at p 25; Re J Leslie Engineers Co Ltd (In liquidation) [1976] 1 WLR 292 at p 304 laid down the now classic principle that in deciding the existence of good faith and honest intention, the absence of knowledge by the transferee of the winding-up petition was a very powerful factor in favour of validation. Incidentally, it is pertinent to note that in Re Gray's Inn S/N W9ztLY6RxkGbj4v4heZiw Construction Co Ltd, it was held that the court should not validate a transaction if its effect was to pay off a creditor in full at the expense of the general creditors. Mr Wong Kim Fatt, at the Bar, informed this court that River View had no creditors, and consequently, he submitted that this court should validate the release of the fixed deposits to the current account of River View. It is my judgment that the court will always have regard as to whether the disposition was made bona fide in the course of the company's current trade, and if not validated, the trade of the company would be paralysed without any advantage as envisaged in Re Clifton Place Garage Ltd [1970] Ch 477 (CA) (emphasis mine).”

It is also my finding that W&T had, as solicitors and agent of the Company, acted purely on the instructions of the Company vide the Company’s letters mentioned above, to pay off the Company’s debts. I also find that there is no evidence before this Court which proves that the said payments made were not based on the good and honest intention of either Liew and/or W&T and as such I do hold that such payments are bona fide.

In Wong Wee Kheong & Anor v Dana Bersama Sdn Bhd & Other Appeal [2013] 3 CLJ 969, the Federal Court had held: “[12] With respect we could not agree with the above contention of the respondent. It is true that ordinarily since the respondent company had been wound up on 24 August 2000, a disposition of the company's property after the commencement of the winding up, which was on 31 May 2000 (filing of the petition) would be void. However based on the peculiar set of facts of the case, it is our S/N W9ztLY6RxkGbj4v4heZiw considered view that the proviso in s. 223 of the Act is still operative in relation to the transactions which took place and the court has the power and jurisdiction to declare the transactions as valid. [13] It is to be noted that s. 223 of the Act makes no mention as to time. It is our view validation can be made by the court at any time. We are in agreement with the submission of learned counsel for the appellants that to insist that the purchasers must have applied for a validation after the company was wound up, there must be knowledge. Here the purchasers had no knowledge at all of the winding up order at the material time. It is also noted that the Act does not prescribe as to how the discretion under s. 223 of the Act is to be exercised. However there are case laws that have distilled the principles involved in validating transactions after the commencement of winding up, and even after a winding order has been granted based on two broad considerations:

if the transaction(s) are beneficial to the general body of creditors; or

if it was just and fair to allow the transaction(s) with particular regard to the good and honest intention of the persons concerned. [14] The general rule in s. 223 of the Act is that it does not shut out bona fide transactions. In Lian Keow Sdn Bhd (In Liquidation) & Anor v. Overseas Credit Finance (M) Sdn Bhd & Ors [1988] 1 LNS 44; [1988] 2 MLJ 449, Seah, SCJ made reference to a passage by Vaisey J in Re Steane's (Bournemouth) Ltd [1950] 1 All ER 21 which states: that each case must be dealt with on its own facts and particular circumstances (special regard being had to the question of the good faith and honest intention of the persons concerned), and that the S/N W9ztLY6RxkGbj4v4heZiw court is free to act according to the judge's opinion of what would be just and fair in each case. The discretion is an unfettered one.”

Applying the principle in Wong Wee Kheong (supra) to the facts of the matter before me, I hold that this Court can hereby validate the transactions made by W&T due to the fact that I have found the said transactions to be bona fide and beneficial to the general body of the Company’s creditors.

It is also noted by this Court that the Applicant / Liquidator in PW 217 & 218 had not identified any creditors of the Company being prejudiced and I agree with learned counsel for W&T, that this would hamper this Court in finding that there are creditors of the Company being so prejudiced.

I now turn to whether section 541 of the Companies Act 2016 is applicable to W&T. This Court holds that the said Section 541 of the Companies Act 2016 refers to only: ‘any person who has taken part in the formation or promotion of the company; or any past or present liquidator or officer’.

As W&T were only solicitors acting for the Company, they would not come under the definition of ‘any person who has taken part in the formation or promotion of the company which leaves this Court to determine if W&T then comes within the term an ‘officer’ of the S/N W9ztLY6RxkGbj4v4heZiw Company. For this I refer to Section 2 of the Companies Act 2016 which defines an ‘officer’ to mean "officer", in relation to a corporation, includes:

any director, secretary or employee of the corporation;

a receiver and manager of any part of the undertaking of the corporation appointed under a power contained in any instrument; and

any liquidator of a company appointed in a voluntary winding up,

I therefore agree with learned counsel for W&T that W&T is clearly not an ‘officer ‘ of the Company pursuant to the Companies Act 2016 and thus any relief which the Liquidator has or any cause of action under that section does not relate to W&T.

As mentioned, before this Court, Liew has in PW 352 sought to declare that the Said Payments are legal and valid pursuant to section 472 of the Companies Act 2016 and/or Order 15 Rule 16 of the Rules of Court 2012 and/or the inherent jurisdiction of the Court. In deciding PW 352, this Court has also had to consider

the payment and/or advancement of the sum of RM100,036.00 to The Law Chambers of Tan Kinv Tat on 13.11.2017;

the payment and/or advancement of the sum of RM5,000.00 to

the payment and/or advancement of the sum of RM440,000.00 to SJEE Engineering Sdn Bhd on 31.10.2017;

the payment and/or advancement of the sum of RM20,000.00 to

the payment and/or advancement of the sum of RM120,000.00 to QST Solutions Sdn Bhd on 31.10.2017;

the payment and/or advancement of the sum of RM90,000.00 to

the payment and/or advancement of the sum of RM68,419.30 to

the payment and/or advancement of the sum of RM66,203.98 to

the payment and/or advancement of the sum of RM50,000.00 to

the payment and/or advancement of the sum of RM67,331.10 to Messrs Ferida, Hassan, Low & Ng on 24.11.2017;

the payment and/or advancement of the sum of RM100,000.00 to Ng Chee Meng on 24.11.2017;

the payment and/or advancement of the sum of RM40,000.00 to

the payment and/or advancement of the sum of RM170,000.00 to Public Bank Berhad on 24.11.2017;

the payment and/or advancement of the sum of RM49,800.00 to

the payment and/or advancement of the sum of RM250,000.00 to Perkasa Solaris Sdn Bhd on 13.11.2017.

I now turn to the above payments made to Messrs The law Chambers of Tan Kinv Tat (TKT) (Payments to TKT) which the Liquidator has in PW 218 sought to declare as invalid and void.

The Applicant / Liquidator had firstly raised the issue of delay in the filing of PW 352. To this I rely on Wong Wee Kheong (supra) where the Federal Court has held, and I repeat, that:- “[13] It is to be noted that s. 223 of the Act (the previous provision for Avoidance of Disposition of Property under the Companies Act 1965) makes no mention as to time. It is our view validation can be made by the court at any time.”

I therefore hold that any alleged delay by Liew is not a bar to a validation order being made.

This Court has noted that the said sum of RM1,636,790.38 i.e Payments to TKT were made on the instructions of the Company via a letter dated 27.10.2017 in exhibit LCW -7 of enclosure 2 in PW 352 based on the adjudication proceedings against Keris Engineering & Communications Sdn Bhd vide Adjudication Reference No. KLRCA/D/0851-2017 (Adjudication Proceedings 0851) as seen in exhibit LCW -5 of enclosure 2 in PW 352.

I have also viewed in enclosure 2 in PW 352:

the Company’s letter dated 27.10.2017 with regards SJEE Engineering Sdn Bhd and the Public Bank Cheques payable to the Company together with the cheque deposit receipts in exhibit LCW-7 thereto;

the Consent Judgement dated 30.10.2017 in the Kuala Lumpur Sessions Court Summons No. WA-A52NCC-3604-08/2016 with Optad Marketing at exhibit LCW-8 thereto;

the Consent Judgement dated 31.10.2017 in the Kuala Lumpur Sessions Court Summons No. WA-A52C-44-05/2016 with OST Solutions Sdn Bhd at exhibit LCW-9 thereto;

the payment and/or advancement of the sum of RM90,000.00 to

the payment and/or advancement of the sum of RM68,419.30 to

the payment and/or advancement of the sum of RM66,203.98 to

the payment and/or advancement of the sum of RM50,000.00 to

the payment and/or advancement of the sum of RM67,331.10 to Messrs Ferida, Hassa, Low & Ng on 24.11.2017;

the payment and/or advancement of the sum of RM100,000.00 to Ng Chee Meng on 24.11.2017;

the payment and/or advancement of the sum of RM40,000.00 to

the payment and/or advancement of the sum of RM170,000.00 to Public Bank Berhad on 24.11.2017;

the payment and/or advancement of the sum of RM49,800.00 to

the payment and/or advancement of the sum of RM250,000.00 to Perkasa Solaris Sdn Bhd on 13.11.2017;

This Court had also considered the Applicant / Liquidators submissions on the Payments to TKT and in particular the contention S/N W9ztLY6RxkGbj4v4heZiw that the said payments made out by TKT were not beneficial for the general benefit of the Company’s creditors, are marked with suspicion on the veracity of the documents or that they were void dispositions and undue preference payments. There is, with respect, in this Court’s view, not sufficient evidence on a balance of probabilities to make a finding as contended by the Applicant / Liquidator.

I will now address specifically the issue of the alleged payments being made to family members or persons connected with Liew. After careful consideration of the said issue, this Court holds that the mere fact that the shareholders or directors of the said companies maybe connected to Liew himself per se, does not, in the absence of any credible and/or corroborating evidence, demonstrate the existence of any fraudulent transactions or a breach of the Companies Act.

On this issue, the Liquidators learned counsel had referred this Court to Puncak Seputih Sdn Bhd & Anor and another case [2020] MLJU 2481 where this Court had declared various payments made by the Company after the presentation of the winding up as being void. With respect, the said case of Puncak Seputih Sdn Bhd (Supra) can be differentiated with the case before me now as in the former there was clear evidence proven to the Court that the company and/or directors therein knew of the presentation of the winding up as opposed to the matter herein where such proof of Liew’s knowledge of the Petition was not proven to this Court.

From my observation of the documents above and the matter presented before me, I am satisfied that Liew was not well versed in S/N W9ztLY6RxkGbj4v4heZiw the Company’s affairs prior to its liquidation on 8.12.2017 and although the Said Payments were made after the Winding Up Order, and based on earlier finding that Liew was unaware of the Petition at the material time, I hold that the said dispositions carried out were in good faith and honestly for the benefit of the Company.

It is also my decision that the said payments were proven to my satisfaction to have occurred for the benefit of the general body of the Company’s creditors and that Liew had carried out the said disposition in good faith and in the course of the Company’s ordinary trade to pay off the Company’s debts at that point in time.

Consequently, based on all of the above evidence and in the circumstances, I further hold that here has been no unfair or undue preference over the creditors of the Company or a misapplication of the Company’s funds in the matter before me.

This Court henceforth:

59.1 dismisses both the Notice of Motion in enclosure 1 of WA- 28PW-217-08/2021 (PW 217) and WA-28PW-218-08/2021 (PW 218) respectively with no order as to costs 59.2 makes a further order in WA-28PW-217-08/2021 (PW 217) that Messrs Wong & Ting (W&T), the 3rd Respondent therein, shall make a claim for and assist the Liquidator in making a claim for the sum of RM125,000 which is currently with the Registrar of Unclaimed Moneys which, upon receipt of the S/N W9ztLY6RxkGbj4v4heZiw same from the Registrar of Unclaimed Moneys, is to be repaid to the Liquidator 59.3 allow and grant order in terms of prayers 1, 2 and 4 of enclosure 1 of WA-28PW-352-12/2021 (PW 352) Dated: 13th day of June 2022 sgd. NADZARIN WOK NORDIN HIGH COURT JUDGE KUALA LUMPUR HIGH COURT Parties: Gow Jia Jian and Poh Yee Li for the Applicant in suit PW352 and 1st Respondent in suit PW217 & PW218 [Messrs Gow Victor & Co.] Segaran A/L S. Mathavan and Mohd Aiziezuddin Bin Suib for the Liquidator / Applicant in suit PW217 & PW218 and Respondent in suit PW352 [Messrs S. Mathavan & Nur Hafizah] C.K Yeoh & Jeffrey Lee for the 3rd Respondent in suit PW217 & PW218 [Messrs Ranjit Singh & Yeoh] S/N W9ztLY6RxkGbj4v4heZiw