The original subscribers to the Articles and Memorandum of association were the directors then namely, one Ng Heng Hooi and one Ng Siew Kian. [6] As is commonly the case, a wide variety of businesses were catered for in the Respondent’s Memorandum of Association. However, in the records of the Suruhanjaya Syarikat Malaysia (‘SSM’), the nature of the Respondent’s business was described as ‘commercial trading’. [7] On 1st February 2002, one Toi Sin Fatt was appointed as director of the Respondent. Following closely on his appointment was the appointment of the Petitioner as a director of the Respondent. [8] Both Toi Sin Fatt and the Petitioner were then the only two directors of the Respondent. They were also its only shareholders. [9] When Toi Sin Fatt and the Petitioner were appointed directors, the Respondent had an issued share capital of RM450,000.00 made up of 450,000 ordinary shares. [10] Of its 450,000.00 issued ordinary shares, Toi Sin Fatt held 270,000 shares, which amounted to 60% of the Respondent’s share capital and the Petitioner held 180,000 shares, which made up the balance 40% of the Respondent’s share capital. 4 [11] The composition of the board of directors and the shareholding in the Respondent made up of only Toi Sin Fatt and the Petitioner lasted some fourteen years, up to 2016. [12] Unfortunately, the relationship between the two men broke down. There were allegations hurled to and fro, all of which were of little relevance for the purposes of this case and need not be explored further. Suffice to say that the relationship between the two men was acrimonious enough for the following events to follow. [13] On the 15th June 2016, notice of an Extraordinary General Meeting (‘EGM’) of the Respondent was issued. The agenda for this EGM consisted of two proposed resolutions; one, for the removal of the Petitioner as a director of the Respondent and, the other, for the appointment of one Ng Yok Fong as director in his stead. [14] Ng Yok Fong was the wife of Toi Sin Fatt. [15] The Petitioner attended the EGM of 15th June 2016. The minutes of the meeting disclosed that at the meeting, the Petitioner sought to know why he was being removed. [16] However, the reply, which was to be found in the minutes, did not make much sense read on its own without more. It was recorded that the Secretary was instructed by the Chairman to state that ‘our company is related and deemed Holding / Subsidiary Company as defined under Section 5(1) (a)(i)(ii) & (iii) of the Companies Act 1965’. The Chairman of the EGM on that day was of course, Toi Sin Fatt, who was the only other director. 5 [17] With Toi Sin Fatt’s majority shares and upon his demand for a poll, both the proposed resolutions were passed. Thus, the Petitioner ceased to be a director of the Respondent and in his stead, Toi Sin Fatt’s wife, Ng Yok Fong, was appointed. [18] Ng Yok Fong herself did not own any shares in the Respondent. [19] As of the same date i.e. 15th June 2016, the Petitioner was also removed as director in four other companies, namely Fiscal Arena Sdn Bhd, Arena Ria Sdn Bhd, Goodluck Marketing Sdn Bhd and ZKS Serangkai Sdn Bhd. These were also companies that the Petitioner and Toi Sin Fatt were involved in. [20] The Respondent was, from then on, managed and run by Toi Sin Fatt and his wife, Ng Yok Fong, replacing the convention that was in place for fourteen years prior thereto – namely, that the Respondent consisted of and was managed only by the Petitioner and Toi Sin Fatt. [21] The following month, on the 20th of July 2016, a circular resolution was passed by the board of directors of the Respondent. [22] By this circular resolution, signed by Toi Sin Fatt and his wife Ng Yok Fong as directors of the Respondent, one Toi Yee Wei was appointed director of the Respondent. [23] Toi Yee Wei, based on her NRIC particulars was then about 22 years of age. She was the daughter of Toi Sin Fatt and Ng Yok Fong. 6 [24] The following month, on 6th August 2016, another circular resolution was passed by the directors of the Respondent, namely Toi Sin Fatt, his wife Ng Yok Fong and their daughter Toi Yee Wei. This time, the resolution was for the appointment of one Toi Yee Voon as a director of the Respondent. [25] Toi Yee Voon was then 26 years of age. She was also a daughter of both Toi Sin Fatt and Ng Yok Fong. [26] Thus, as at 6th August 2016, the Respondent became a company that was managed and run by Toi Sin Fatt and his immediate family. Meanwhile, the shareholding of the Respondent remained the same – 60% belonging to Toi Sin Fatt and 40% belonging to the Petitioner. [27] As at 11th August 2016, the Respondent’s financial performance for the financial year ended 30th September 2015 disclosed that the Respondent had zero revenue for the period in question. The Respondent also recorded a loss of RM9,455.00. These financial data in respect of the Respondent were to be found in the Summary of Financial Information available at the SSM. [28] This Summary also disclosed that the Respondent had current assets of only RM2,246.00 and non-current assets of RM597,428.00. Its current liabilities were in the sum of RM277,035.00. [29] In October 2016, Toi Sin Fatt started to draw a salary of RM4,000.00 a month. At that point in time, there was no resolution authorising the payment of this salary. 7 [30] On the 2nd of February 2017, notice of an EGM of the Respondent to be held on 23rd February 2017 was issued. The agenda for this EGM consisted of two proposed resolutions. The first was to increase the Respondent’s share capital by RM45,000.00 from RM450,000.00 to RM495,000.00. The second was to utilise the money therefrom as legal fees to have struck out a Winding up Petition ‘lodged by an ex-director of the Company…’. [31] At the EGM of 23rd February 2017, both the proposed resolutions were passed. The Petitioner, by proxy, voted against both resolutions. [32] Although offered his portion of the rights issue, the Petitioner declined. As such the 45,000.00 rights issue were taken up by Toi Sin Fatt and his wife Ng Yok Fong; 34,000 shares by Toi Sin Fatt and 11,000 shares by Ng Yok Fong. [33] On 29th March 2017, at the Respondent’s Annual General Meeting (‘AGM’), one of the resolutions passed was the following: ‘That the payment of director’s remuneration to Toi Sin Fatt commencing on 1st October, 2016 be and is hereby ratified and approved in continuation until varied by the majority members of the Company in General Meeting.’ [34] Also resolved and passed was the following resolution, authorising the directors of the Respondent to allot shares: ‘That pursuant to Section 75 of the Companies Act 2016, approval be and is given to the Directors to issue shares in the Company at any time 8 and upon such terms and conditions and for such purposes as the Directors may in their absolute discretion deem fit.’ [35] On 11th July 2017, notice of an EGM of the Respondent to be held on 8th August 2017 was issued. The agenda for the EGM consisted of two special resolutions, the first was for the revocation of the entire existing memorandum of association of the Respondent and the second was to adopt a set of new objects for the Respondent. [36] These resolutions were subsequently passed at the EGM held on 8th August 2017. The Petitioner, again, by proxy voted against the proposed resolutions. [37] On 21st July 2017, Toi Sin Fatt transferred 250,000 shares in the Respondent to one Wong Moy Foong. This transfer was authorised by the Respondent’s board of directors, signed by Toi Sin Fatt, Ng Yok Fong, Toi Yee Wei and Toi Yee Voon. [38] On 11th September 2017, the Respondent’s board authorised the transfer of 25,000 shares to ZKS Serangkai Sdn Bhd. The authority of the board to do so was signed by its directors Toi Sin Fatt, Ng Yok Fong, Toi Yee Wei and Toi Yee Voon. [39] However, it was only on the 24th of October 2017, that the board of directors of ZKS Serangkai Sdn Bhd resolved to purchase the 25,000 shares in the Respondent from Toi Sin Fatt. 9 [40] As it turned out, the members of the board of directors of ZKS Serangkai Sdn Bhd’s board were Toi Sin Fatt and family namely, Toi Sin Fatt, Ng Yok Fong, Toi Yee Wei and Toi Yee Voon. [41] On 1st November 2017, notice was given of an EGM of the Respondent to be held on 22nd July 2017. The agenda was to pass resolutions to increase the Respondent’s share capital from 495,000 shares to 2,475,000 shares by way of a rights issue and to use the funds to be raised thereby, i.e. RM1,980,000.00, as down payment for the purchase of properties not exceeding a sum of RM6,000,000.00. [42] The Properties to be purchased were 3 units of shophouses in Daerah Kinta, in Negeri Perak. The board of directors was also to be authorised to apply for a bank loan of RM5,000,000.00 to pay towards the balance of the purchase price for the properties. [43] As at 15th November 2017 and for the financial year ended 30th September 2016, the Respondent recorded a revenue of RM26,092.00 but a loss of RM35,838.00. Its current liabilities had risen from RM277,035.00 the previous year to RM318,322.00. These data were to be found in the Summary of Financial Information in respect of the Respondent made available by the SSM [44] On the 20th of November 2017, the Petitioner presented its Petition against the Respondent. [45] Subsequently, at the EGM held on 22nd November 2017, the resolutions proposed were passed. Again, by proxy, the Petitioner voted against the resolutions. 10 [46] Wong Moy Fong acquired 1,000,000 shares in the Respondent arising out of the rights issue. Evidence of payment for these shares were tendered in the form of the Respondent’s receipts for two payments from Wong Moy Fong; one receipt dated 4th December 2017 for RM280,000.00, being payment for 400,000 shares and another dated 6th December 2017 for RM420,000.00, being payment for 600,000.00 shares. [47] On 29th December 2017, both Toi Yee Wei and Toi Yee Voon resigned as directors of the Respondent. Thus, they were still directors when the Petition was presented and the shareholders of the Respondent were Toi Sin Fatt, Ng Yok Fong, Wong Moy Foong and ZKS Serangkai Sdn Bhd. [48] On 30th October 2018, the Respondent’s Company Secretary certified that no director’s fees were paid or dividends declared by the company in respect of its financial years ended 30th September 2016, 30th September 2017 and 30th September 2018. [49] In evidence were the salaries paid to the directors Toi Sin Fatt of RM4,000.00 a month. Based on the resolution passed at the Respondent’s AGM of 29th March 2017, Toi Sin Fatt would have been receiving this amount of salary since 1st October 2016. [50] As for Ng Yok Fong, she was paid a salary of RM2,000.00 a month. Evidence of this amount of salary paid was exhibited and they indicate that payment had been made since 28th July 2017. 11 [51] Before the hearing of the Petition, the learned Judicial Commissioner (as he then was) had granted an application to allow Wong Moy Fong to appear in the proceedings to resist the Petition. By then, Wong Moy Fong was the majority shareholder in the Respondent with 1,250,000 shares. The opposing contentions [52] The Petitioner’s complaints consisted of a plethora of assertions and contentions. [53] The Petitioner maintained that mutual trust and confidence between himself and Toi Sin Fatt ceased to exist when their relationship broke down. There then followed a cascade of events which the Petitioner was critical of. [54] It began with his removal as a director of the Respondent, which the Petitioner maintained was unlawful. Toi Sin Fatt’s family members were then appointed on to the board of the Respondent, turning it into a company run by Toi Sin Fatt’s family, all of whom, save for Toi Sin Fatt, had no shares and thus had no interest in the company. [55] The Petitioner also complained that he himself was not paid anything by the Respondent, that he was prevented from accessing the Respondent’s records, while Toi Sin Fatt and his wife, Ng Yok Fong, were paid monthly director’s salaries. 12 [56] The Petitioner’s complaints also extended to allegations that his interest in the company was diluted by the rights issues and the original nature of the Respondent’s business had also changed with the changes made to the objects in its Memorandum of Association. [57] The Petitioner alleged that Toi Sin Fatt and his family had acted in their own interest, instead of the interest of the Respondent’s members, in particular, himself. [58] The Petitioner also pointed to a decision of the High Court in Suki Mee v Arena Ria Sdn Bhd [2018] 8 MLJ 550. That case was concerned with a winding up petition presented by the Petitioner against a company in which Toi Sin Fatt was also a shareholder and that petition was allowed. [59] It was the Petitioner’s contention that the factual circumstances in Arena Ria Sdn Bhd were similar, if not the same, and therefore the outcome should be the same. [60] The Respondent and the contributory, Wong Moy Foong contended, in essence, that each act that was the subject of the Petitioner’s complaint was carried out or conducted lawfully by the Respondent and consistent with its Articles and Memorandum of Association. [61] It was contended that the Petitioner’s removal as a director was effected in accordance with section 128 of the Companies Act 1965 and Article 69 of the Respondent’s Articles of Association. [62] The rights issues and the payment of salaries were approved and in accordance with the Articles of the Respondent. 13 [63] It was denied that Toi Sin Fatt and family had acted in their own interest and it was maintained that the Petitioner’s allegations were all unsubstantiated or without basis. [64] It was also contended that the Petitioner had presented an earlier winding up petition against the Respondent and which petition was dismissed on 31st May 2017. This was Ipoh High Court Winding Up Petition AA-28NCC-69-09/2016 (‘Petition 69’) which was presented on 28th September 2016. [65] It was contended by the Respondent that the Petitioner was estopped from raising issues that were raised and determined in Petition 69. The prior petitions referred to by the parties [66] In Arena Ria Sdn Bhd, the provisions raised and relied upon were sections 181(1)(a) and 218(1)(f) and (i) of the Companies Act 1965. [67] The decision of the learned judge in Arena Ria Sdn Bhd turned on a finding that fell within the ambit of section 218(1)(i) of the Companies Act 1965. In paragraph 25 of his judgment, the learned judge held as follows: ‘[25] Berdasarkan keterangan, adalah didapati bahawa hubungan pempetisyen dan TSF tidak boleh dipulihkan lagi. Hayat responden sekiranya dilanjutkan sekali pun, sudah pastilah mengundang pertikaian yang tidak akan ada kesudahannya. Mereka sewajarnya diperintahkan 14 berpisah supaya boleh membawa haluan masing-masing. Keadaan tersebut menjustifikasikan suatu perintah penggulungan responden di atas alasan ‘adil dan saksama’ seperti mana yang diperuntukkan di perenggan 218(1)(i) Akta 1965.’ [68] Unlike the Petition at hand, the petition in Arena Ria Sdn Bhd had also invoked section 218(1)(i). It was on the basis of section 218(1)(i) that it was held just and equitable that the respondent company be wound up and the petition allowed. The equivalent to section 218(1)(i) of the Companies Act 1965, which is section 465(1)(h) of the Companies Act 2016, was not invoked in the current Petition. [69] As for Petition 69, unfortunately, there were no written grounds of judgment for the decision of the Court. This was probably because there was no appeal against the decision in that petition. [70] Petition 69 was before the same Judicial Commissioner as was another winding up petition, i.e. Winding Up Petition AA-28NCC-68- 09/2016 between the Petitioner in this case, Suki Mee, and Fiscal Arena Sdn Bhd (“Petition 68”). Yet again the principal disputants were Suki Mee and Toi Sin Fatt. [71] While there were no written grounds for the decision in respect of Petition 69, there were written grounds for the decision in respect of Petition 68. [72] In dismissing Petition 68 the learned Judicial Commission held, in her written grounds of judgment, that: 15 ‘[12] The petitioner’s winding up petition comprising section 181(1)(a) and 218(1)(f) and (i) of the Act rolled up into one petition is highly irregular and defective. Therefore, it is a matter of course that the said petition be dismissed for fundamental non-compliance with current practice and the law. It is also a matter of course that the complaints of the petitioner in the said defective petition could not only be considered but judicially determined by this court as a result thereof. That said, it does not bar the petitioner from further pursuing his complaints against the respondent by electing the right mode of proceedings and filing in the correct cause papers that are procedurally correct.’ [73] The merits of Petition 68 were therefore not considered and the petitioner was allowed to file afresh by invoking the correct procedure. [74] In both Petition 69 and Petition 68, the provisions invoked were identical i.e. sections 181(1)(a) and 218(1)(f) and (i) of the Companies Act 1965. [75] It is significant that both the petitions were dismissed on the same day, 31st May 2017, and they were dismissed by the same learned Judicial Commissioner. The same counsel appeared for the petitioner in Petition 68 and Petition 68 while the respondents in Petition 68 and Petition 69 were represented by different counsel. [76] Thus, it was the Petitioner’s contention that Petition 69 was dismissed on the same technical ground as Petition 68. [77] This, in the absence of any written grounds of judgment to the contrary, would seem logical as both Petition 68 and Petition 69 had, in 16 their intitulement, expressly invoked identical provisions under section 181 and 218 of the Companies Act 1965. [78] It was also noted that the current Petition, also filed in the High Court in Ipoh, was now limited to only one ground i.e. section 465(1)(f) of the Companies Act 1965 without invoking the current equivalent of section 181 of the Companies Act 1965, i.e. section 346, thus avoiding the procedural objection found in the learned Judicial Commissioner’s grounds of judgment in Petition 68. [79] It needs however to be pointed out that in the current Petition, the allegations that the directors had acted in their own interest included conduct that occurred after Petition 69 was presented i.e. on 28th September 2016. These were principally payments of salaries that they had made to themselves, which is addressed below. [80] Conduct after the 28th September 2016 would not have been the subject matter of Petition 69, even if the merits of that petition were considered. [81] In light of the foregoing, the estoppel sought to be raised against the Petition was held not sustainable. Decision of the High Court [82] In dismissing the Petition, the learned Judicial Commissioner held that the mere breakdown in the relationship between the Petitioner and Toi Sin Fatt was no basis to wind up the Respondent. It was held that 17 there was also no evidence that the affairs of the Respondent were conducted ‘outside the acceptable corporate transparency and accountability norms.’ [83] The learned Judicial Commissioner also concluded that the Petition was brought by the Petitioner in response to his removal as a director. It was held that the Petitioner had chosen a ‘destructive mode of closing down the Respondent company’ when there were other means less damaging to pursue the Petitioner’s complaints, such as a summons for oppression. [84] Of the Petitioner’s removal as a director, it was held to have been lawfully conducted. That the Petitioner was not paid was due to the fact that he had been removed as a director. The Appellant’s appeal [85] As was stated at the outset, this Petition was presented based solely on section 465(1)(f) of the Companies Act 2016. [86] The sphere of application of section 465(1)(f) is somewhat narrow when compared to, say, section 346 of the Companies Act 2016, which caters for remedies in cases of oppression. [87] When all the Petitioner’s complaints and allegations are examined, they appear to have scant regard to the somewhat narrow confines of the provision invoked for mounting this Winding Up Petition. 18 [88] Yet, the allegations and the evidence led of them nevertheless provided the factual circumstances upon which the acts complained of may, or should, be viewed and weighed, if they do come within section 465(1)(f). Clearly, the weight to be attached to an act or acts may vary depending on the circumstances surrounding it. [89] Section 465(1)(f) affords only one option, either the company be wound up or not. The conduct that is the focus of this provision is that of the directors of the company. [90] For section 465(1)(f) to apply, the conduct of the directors in relation to the affairs of the company must be such that the directors had (i) acted in their own interest rather than ‘the interests of the members as a whole’ or (ii) acted in a manner “which appears to be unfair and unjust to members;” [91] As regards the phrase ‘interests of the members as a whole’, it is a phrase that was also used in section 218(1)(f) of the former Companies Act 1965, which was the earlier iteration of section 46591)(f). [92] Section 218(1)(f) of the Companies Act 1965 provided as follows: ‘218 (1) The Court may order the winding up if –