Gt Nelson Realty Sdn. Bhd. v Everhall (M) Sdn. Bhd. (WA-22NCC-749-10/2023)

EVERHALL (M) SDN. BHD. (COMPANY NO.: 200701028031 /

MAGNA PRIMA BERHAD (COMPANY NO.: 199501040315 / 369519-P) ... DEFENDANTS GROUNDS OF JUDGMENT [1] Before the court is a claim by the plaintiff for commission allegedly due under a property marketing agreement. The plaintiff, a real estate agency, contends it successfully facilitated a significant property transaction and is entitled to payment of RM1,680,000.00 from the defendants. The first defendant did not enter appearance and judgment in default of appearance has been entered against it. The second defendant contests liability vigorously, denying any contractual relationship with the plaintiff and asserting that it is a separate legal entity with no obligation to honour any agreement entered into by the first defendant. [2] The central issues for determination concern the existence and validity of the alleged marketing agreement, the identity of the proper contracting party or parties, whether the corporate veil separating the first and second defendants may be lifted to impose liability on the second defendant, and ultimately whether the plaintiff has established its entitlement to the claimed commission from either or both defendants. BACKGROUND FACTS [3] The Plaintiff, GT Nelson Realty Sdn Bhd (“GT Nelson”), is a company incorporated in Malaysia and operates in the business of property agency and real estate consultancy. [4] The First Defendant, Everhall (M) Sdn Bhd (“Everhall”), was incorporated on 24.8.2007. At all material times, Everhall was a wholly-owned subsidiary of the Second Defendant, Magna Prima Berhad (“Magna Prima”), and was the registered proprietor of a four-storey commercial building comprising a lower ground commercial area designated for a supermarket and 345 car park lots, located at Pusat Komersial Jalan Kuching, Kuala Lumpur, and known as the “Supermarket & Commercial Complex of Pusat Komersial Jalan Kuching, KL” (“the Property”). [5] Magna Prima is a public company limited by shares listed on the Main Market of Bursa Malaysia Securities Berhad. It was incorporated on 5.12.1995. At all material times, Magna Prima was the holding company of Everhall and operated a group structure comprising 17 subsidiary companies in 2020. [6] In June 2020, the Property was being marketed for sale by Everhall. [7] Sometime in June 2020, Lim Cheng Chong, also known as Andy Lim, (“Andy Lim”), a real estate negotiator working for GT Nelson, saw a bunting advertising the Property for sale at Jalan Kuching. He contacted the number displayed on the bunting. [8] The person who responded was Thiruchelvam a/l Raju (“Thiruchelvam”). He was employed by Magna Prima Development Sdn Bhd (a subsidiary of Magna Prima) holding the position of Director of Property Development & Special Projects. His business card reflected his employment with Magna Prima Development Sdn Bhd. [9] On 14.6.2020, Andy Lim visited the Property with Thiruchelvam. Following this viewing, Andy Lim decided to market the Property. He informed Thiruchelvam of his intention and sent Nelson's standard agency appointment form to Thiruchelvam for consideration. [10] Thiruchelvam informed Andy Lim that the company had its own appointment letter format and would prepare it. On or about 15.6.2020 to 16.6.2020, Thiruchelvam informed Andy Lim that the appointment letter was ready and could be collected at the office. [11] A Letter of Appointment dated 15.6.2020 was issued by Everhall appointing GT Nelson as a non-exclusive marketing agent for the Property. The material terms of this Letter of Appointment were as follows: a) The appointment period was for 3 months from 15.6.2020, expiring on 15.9.2020; b) The commission payable was 3% of the selling price; c) Clause 4(b)(iii)(b) provided that the Sale and Purchase Agreement was to be signed within 14 days from the date of booking; d) Clause 5 provided that GT Nelson's services would be deemed completed upon full compliance with Clause 4; and e) Clause 6 provided that commission would be payable within 30 days from receipt of GT Nelson's invoice after completion of the Sale and Purchase Agreement and transfer of title. [12] The Letter of Appointment was signed on behalf of Everhall by Thiruchelvam. It was signed on behalf of GT Nelson by Andy Lim. No representative from Magna Prima signed this document and Magna Prima was not named as a party to the Letter of Appointment. [13] Following this appointment, Andy Lim proceeded to market the Property. He made contact with various potential purchasers, including entities within the Cowboy group of companies. [14] On 13.7.2020, a company called Super Cowboy Wholesale (BP) Sdn Bhd issued a letter expressing interest to purchase the Property at a price of RM56,000,000.00. This letter was addressed to Everhall. [15] On or about 3.8.2020, a company called Cowboy (KL) Sdn Bhd was incorporated. The incorporation date reflected in the Companies Commission of Malaysia records is 11.8.2020. [16] Cowboy (KL) Sdn Bhd had five equal shareholders, each holding 5,920,000 shares representing 20% shareholding: Super Cowboy Wholesale (BP) Sdn Bhd, Super Cowboy Trading Sdn Bhd, Cowboy (K3) Sdn Bhd, Cowboy Sdn Bhd, and Super Cowboy Sdn Bhd. The directors of Cowboy (KL) Sdn Bhd included Lim Kian Siew, Teoh Ka Lai, Teoh Yong Foo, and members of the Teoh family. [17] Around August 2020, Cowboy (KL) Sdn Bhd paid a 2% deposit towards the purchase price. The evidence shows this amounted to approximately RM1,120,000.00. [18] In December 2020, a meeting was held which was attended by representatives from both the seller's side and the purchaser's side. From the seller's side, the attendees included Thiruchelvam, Datuk Wira Rahdian Mahmud bin Muhammad Khalil (“Datuk Rahdian”), a director of both Everhall and Magna Prima, and Vikram a/l Samugham (“Vikram”), the legal manager of Magna Prima. From the purchaser's side, representatives from the Cowboy group attended. Andy Lim from GT Nelson was also present at this meeting. [19] On 3.5.2021, a Sale and Purchase Agreement was executed between Everhall (as vendor) and Cowboy (KL) Sdn Bhd (as purchaser) for the sale of the Property at the agreed purchase price of RM56,000,000.00. The Sale and Purchase Agreement was formally signed some 294 days after the payment of the 2% deposit and approximately 323 days after the letter of interest from Super Cowboy Wholesale (BP) Sdn Bhd. [20] Following the Sale and Purchase Agreement, GT Nelson issued Invoice No. INV2110/00062 dated 18.10.2021 to Everhall for the sum of RM1,680,000.00. A copy of this invoice was physically handed over to the office shared by Everhall and Magna Prima on 1.4.2022. [21] Magna Prima's financial statements and announcements to Bursa Malaysia disclosed information regarding the disposal of the Property. In the Bursa announcement dated

19.4.2021, Magna Prima announced the proposed disposal of the Property for RM56,000,000.00, stating that the transaction was expected to result in an estimated loss on disposal of approximately RM0.4 million. [22] On 5.5.2022, Magna Prima entered into a Share Sale Agreement with Sinaran Sensasi Sdn Bhd (“Sinaran Sensasi”) to dispose of its entire equity interests in multiple subsidiaries, including Embassy Court Sdn Bhd, Magna Prima Construction Sdn Bhd, Everhall (M) Sdn Bhd, Monetary Icon (M) Sdn Bhd, Prima Awan (M) Sdn Bhd, and MPrima (Shah Alam) Sdn Bhd, for a total cash consideration of RM50.00. At the time of this disposal, Everhall had negative net assets of approximately RM59 million. [23] GT Nelson, being dissatisfied that the commission remained unpaid, filed a Writ of Summons and Statement of Claim on 4.10.2023 against both Everhall and Magna Prima seeking payment of the commission sum of RM1,680,000.00. [24] Everhall did not enter appearance and Judgment in Default was entered against it on 30.12.2023 for the sum of RM1,680,000.00 together with interest at 5% per annum from the date of the Writ until full settlement, and costs. [25] Magna Prima filed its Defence on 20.9.2023, denying liability and asserting that it was a separate legal entity from Everhall and was not a party to the Letter of Appointment. RESPECTIVE PARTIES' PLEADED CASE AND RELIEFS SOUGHT GT Nelson's Case [26] GT Nelson's case as pleaded in the Statement of Claim is founded on the following contentions. [27] First, that pursuant to the Letter of Appointment dated 15.6.2020, GT Nelson was appointed as a non-exclusive marketing agent by Everhall to market and procure a purchaser for the Property. Magna Prima, as the parent company of Everhall, was materially involved in and had full knowledge of the terms of the appointment and the transaction. [28] Second, that GT Nelson successfully performed its obligations by procuring Super Cowboy Wholesale (BP) Sdn Bhd, which expressed interest to purchase the Property at RM56,000,000.00 through a letter dated 13.7.2020. Thereafter, Everhall entered into a Sale and Purchase Agreement dated 3.5.2021 with Cowboy (KL) Sdn Bhd, an entity within the same corporate group, at the same purchase price. [29] Third, that GT Nelson's services were the effective cause of the sale to Cowboy (KL) Sdn Bhd at RM56,000,000.00, entitling GT Nelson to commission calculated at 3% of the selling price, amounting to RM1,680,000.00. [30] Fourth, that the corporate veil of Everhall should be lifted to impose liability on Magna Prima. GT Nelson contends that Magna Prima concealed its involvement and evaded liability by: a) Controlling all aspects of Everhall's business including the property disposal; b) Receiving the benefit of the RM56,000,000.00 proceeds from the property sale through the corporate group structure; c) Having full knowledge of the appointment and the commission obligation through common directors such as Datuk Rahdian and through its employee Thiruchelvam who handled all aspects of the appointment and sale; d) Deliberately disposing of Everhall for a nominal sum of RM50.00 shortly after the property sale was completed, with the intention of evading the commission liability. [31] GT Nelson seeks the following reliefs: a) Judgment against Everhall and Magna Prima jointly and severally for the sum of RM1,680,000.00; b) Interest at the rate of 5% per annum from the date of the Writ until full settlement; c) Costs of the action; and d) Such other relief as the court deems fit. Magna Prima's Case [32] Magna Prima's pleaded defence, as articulated in its Defence filed on 20.9.2023, is founded on the following key contentions. [33] First, that the Letter of Appointment dated 15.6.2020 was entered into solely between GT Nelson and Everhall. Magna Prima was not a party to this contract. There is no privity of contract between GT Nelson and Magna Prima. [34] Second, that Everhall and Magna Prima are separate legal entities. Magna Prima, as a holding company, does not control, take part in, or interfere with the business and administration of Everhall. Both companies function and operate independently. [35] Third, that the Letter of Appointment suffers from fundamental defects that render it inadmissible or invalid: a) It was not properly stamped in accordance with the Stamp Act 1949. The consideration stated was “zero” when in fact the commission contemplated was RM1,680,000.00 based on a 3% commission on a RM56 million sale. The document should have been stamped under Item 22 of the First Schedule as a service agreement secured by consideration, requiring ad valorem duty; b) It was not signed by a Registered Estate Agent in compliance with Rule 102 of the Valuers, Appraisers and Estate Agents Rules 1986. The signatory, Andy Lim, was only a Real Estate Negotiator, not a Registered Estate Agent. [36] Fourth, that GT Nelson failed to comply with the terms of the Letter of Appointment: a) The appointment period expired on 15.9.2020, being 3 months from 15.6.2020. No extension was ever requested or granted. The Sale and Purchase Agreement was only signed on 3.5.2021, some 7.5 months after the appointment expired; b) Clause 4(b)(iii)(b) required the Sale and Purchase Agreement to be signed within 14 days from the date of booking. However, there was a delay of 294 days between the payment of deposit and the signing of the Sale and Purchase Agreement, representing a material breach; c) GT Nelson cannot rely on an expired contract or claim commission for a sale that occurred long after the appointment terminated. [37] Fifth, that GT Nelson failed to prove it procured Cowboy (KL) Sdn Bhd, the actual purchaser. The letter of interest was from Super Cowboy Wholesale (BP) Sdn Bhd, a different entity. Cowboy (KL) Sdn Bhd was only incorporated on 11.8.2020, after the letter of interest was issued. There is no evidence that Cowboy (KL) Sdn Bhd was acting as a nominee or agent for Super Cowboy Wholesale (BP) Sdn Bhd. [38] Sixth, that even if the commission is payable, Clause 6 of the Letter of Appointment provides that commission is payable within 30 days from receipt of invoice after completion of the Sale and Purchase Agreement and transfer of title. The evidence does not establish that title has been transferred. GT Nelson's claim is therefore premature. [39] Seventh, that there are no grounds to lift the corporate veil. Magna Prima did not receive any benefit from the property sale. The financial statements show zero gain from the disposal. The Bursa announcement disclosed an expected loss of RM0.4 million. The property sale proceeds were used to settle Everhall's bank borrowings, not transferred to Magna Prima. [40] Eighth, that the disposal of Everhall's shares for RM50.00 was not undertaken to evade liabilities. It was part of a larger corporate restructuring involving multiple subsidiaries being sold to the same purchaser for a total consideration of RM50.00. At the time of disposal, Everhall had negative net assets of approximately RM59 million. A sale at RM50.00 was not an undervalue in those circumstances. Moreover, Everhall continues to exist and remains liable for all its debts. [41] Ninth, that Magna Prima is a major public listed company subject to stringent regulatory oversight by Bursa Malaysia. All material transactions and disposals were properly disclosed through Bursa announcements. There was no concealment of facts or improper conduct. [42] Magna Prima seeks dismissal of GT Nelson's claim with costs. WITNESSES [43] Three witnesses appeared for GT Nelson as follows: a) PW1 is the aforementioned Thiruchelvam, who was the Director of Property Development & Special Projects for Magna Prima Development Sdn Bhd (a subsidiary of Magna Prima) at the material time. His evidence primarily relates to Nelson's engagement as an agent, the initial negotiations regarding the sale of the property, and the receipt of the initial booking fee. He testified that he was the primary contact person dealing with GT Nelson's agent, Andy Lim, regarding the sale of the property owned by Everhall, and confirmed the WhatsApp conversations between them. He admitted to being involved in the preparation of the Letter of Appointment dated 15.6.2020, which was signed by Datuk Rahdian, despite not being a director of Everhall. He stated that while Magna Prima was the “mother company” and involved in the group’s projects, it was “not directly” involved in this specific sale. Furthermore, he confirmed facilitating the collection of the 2% booking fee from the Cowboy group in August 2020 but claimed to have no knowledge of the final Sale and Purchase Agreement or the specific purchaser, Cowboy (KL) Sdn Bhd, as he left the company in January 2021. b) PW2 is the aforementioned Andy Lim, a Real Estate Negotiator/Consultant working for GT Nelson. His evidence primarily relates to his engagement as an agent to market the Property, his success in procuring the purchaser (the “Cowboy” group), and the subsequent claim for unpaid commission amounting to RM1,680,000.00. He testified that he initially contacted Thiruchelvam in June 2020 after seeing a banner on the building and was subsequently appointed via a letter dated 15.6.2020 to market the property. He successfully negotiated the sale to Super Cowboy Wholesale (BP) Sdn Bhd (which nominated Cowboy (KL) Sdn Bhd as the purchaser) for RM56 million. He gave evidence regarding a meeting in December 2020 attended by directors and officers of Magna Prima, including its Group Managing Director and Legal Advisor, arguing this proved Magna Prima had full knowledge and control of the transaction. Furthermore, he claimed that while Magna Prima recorded the RM56 million proceeds as revenue in its annual reports, it subsequently sold Everhall for only RM50.00 to a third party to avoid paying the commission, an act he described as being done in bad faith. c) PW3 is Lim Kian Siew, a Director of the “Super Cowboy” group of companies, including Super Cowboy Wholesale (BP) Sdn Bhd and Cowboy (KL) Sdn Bhd. His evidence primarily relates to the timeline and mechanics of purchasing the property, his dealings with GT Nelson’s agent (Andy Lim), and the specific involvement of Magna Prima in authorising the transaction. He testified that he was introduced to the property by Andy Lim, whom he recognised as the broker for the transaction. He confirmed signing the initial letter of intention via Super Cowboy Wholesale (BP) Sdn Bhd and paying the 2% booking fee through another group company, Super Cowboy Trading. He explained that a new entity, Cowboy (KL) Sdn Bhd, was subsequently incorporated to act as the purchaser for the Sale and Purchase Agreement signed in May 2021. Crucially, he testified that before signing the agreement, he specifically requested a board resolution from Magna Prima to approve the sale because he identified it as the parent company and wanted to ensure the transaction had their official “green light”. Furthermore, he revealed that the RM56 million purchase price was insufficient to cover Everhall’s redemption sum and outstanding liabilities (such as maintenance and quit rent), forcing his company to advance an additional RM4.8 million under a supplementary agreement to complete the transfer. [44] One witness testified for Magna Prima, namely DW1, the aforementioned Vikram, the Legal Manager of Magna Prima since September 2013. His evidence primarily relates to the corporate separation between Everhall and Magna Prima, the assertion that Magna Prima was not a party to the agency contract, and the justification for selling Everhall’s shares as a legitimate corporate exercise rather than an evasion of debt. He testified that Everhall and Magna Prima are separate legal entities and that Magna Prima does not interfere with the business or decision-making of Everhall. He stated that the Letter of Appointment dated 15.6.2020 was strictly between GT Nelson and Everhall, containing no clauses that obligated Magna Prima to make any payments. He explained that Magna Prima sold all its shares in Everhall to Sinaran Sensasi in May 2022 as part of a strategic move to streamline its focus on core businesses, denying that this was done to evade liability to GT Nelson. Furthermore, he argued GT Nelson’s claim was baseless because their appointment had automatically lapsed on 15.9.2020, months before the Sale and Purchase Agreement was signed in May 2021. Finally, he confirmed that Magna Prima did not receive the proceeds from the property sale, as those funds were used by Everhall to settle its own loans. ISSUES TO BE TRIED [45] The parties filed a Statement of Agreed Issues to be Tried on 4.3.2024, identifying seven issues for the court's determination: a) Issue No. 1: Whether the Letter of Appointment appointing GT Nelson as non-exclusive marketing agent for the property was signed by GT Nelson and Everhall, and whether Magna Prima as the parent company of Everhall at the material time received benefit from the sale of the property? b) Issue No. 2: At the material time, were notices of demand dated 13.12.2022 and 9.1.2023 for the commission sum of RM1,680,000.00 delivered to Everhall and also Magna Prima? c) Issue No. 3: Whether GT Nelson performed the services as agreed in the Letter of Appointment and successfully obtained a purchaser introduced by GT Nelson to purchase the property at a sale price of RM56,000,000.00? d) Issue No. 4: Whether Everhall and Magna Prima discharged their obligation to pay GT Nelson's commission immediately after the Sale and Purchase Agreement was signed and completed for the sum of RM1,680,000.00? e) Issue No. 5: Whether Magna Prima is jointly liable together with Everhall? f) Issue No. 6: Whether GT Nelson's claim against Magna Prima is barred by the legal principle of “separate legal entity”? g) Issue No. 7: Whether GT Nelson has fulfilled all the terms in the Letter of Appointment dated 15.6.2020? [46] Notwithstanding the above issues, from the facts of the case, defences relied on by Magna Prima, and the submissions of parties, the court frames the following main issues for deliberation which this court considers pivotal to the resolution of this case: a) Whether, in light of the Agreed Issues to be Tried and the parties’ pleadings, (i) GT Nelson’s failure to separately address Issue 5 is immaterial because joint and several liability against Magna Prima would follow if the corporate veil is lifted, and (ii) Issue 7 on GT Nelson’s compliance with (and the legal validity/admissibility of) the Letter of Appointment may nevertheless be raised and determined as a question going to the existence of any enforceable commission obligation. b) Whether the Letter of Appointment dated 15.6.2020 is admissible in evidence, having regard to whether it was properly stamped under Item 4 or Item 22 of the First Schedule to the Stamp Act 1949. c) Whether the Letter of Appointment dated 15.6.2020 is invalid or unenforceable by reason of non-compliance with Rule 102 of the Valuers, Appraisers and Estate Agents Rules 1986, which requires estate agency agreements to incorporate the registration number of a Registered Estate Agent, when the document was signed by a Real Estate Negotiator rather than a Registered Estate Agent. d) Whether the Letter of Appointment dated 15.6.2020 remained effective at the time the Sale and Purchase Agreement was executed on 3.5.2021, notwithstanding that the express appointment period of 3 months expired on 15.9.2020. e) Whether GT Nelson procured the purchaser within the meaning of the Letter of Appointment when the letter of interest dated 13.7.2020 came from Super Cowboy Wholesale (BP) Sdn Bhd but the Sale and Purchase Agreement dated 3.5.2021 was executed with Cowboy (KL) Sdn Bhd, a different legal entity incorporated after the letter of interest was issued. f) Whether the commission payable to GT Nelson under Clause 6 of the Letter of Appointment should be calculated as 3% of the RM56,000,000 gross selling price stated in the Sale and Purchase Agreement (being RM1,680,000), or as 3% of the “nett selling price” after deduction of the redemption amount paid to MBSB Bank Berhad such that no commission is payable. g) Whether Magna Prima's involvement in the property disposal transaction, including the provision of shared management personnel (Thiruchelvam), common directors (Datuk Rahdian), centralised legal services (Vikram), board approval requirements, and consolidated financial reporting, constitutes normal parent company oversight within a corporate group structure or amounts to such improper control as to justify lifting the corporate veil and imposing liability on Magna Prima for Everhall's obligations. h) Whether Magna Prima received a benefit from the sale of the Property by Everhall for RM56 million, such benefit being a relevant factor in determining whether the corporate veil should be lifted to impose liability on Magna Prima for Everhall's commission obligations to GT Nelson. i) Whether the disposal of Everhall by Magna Prima to Sinaran Sensasi for RM50 on 5.5.2022 (after the property sale in May 2021 but before the commission invoices were issued in December 2022) constitutes a deliberate attempt to evade the commission liability such as to justify lifting the corporate veil and imposing liability on Magna Prima. j) Whether the corporate structure between Everhall and Magna Prima was used either to conceal the true facts or true controller of the transaction (the concealment principle), or to evade an existing legal obligation owed to GT Nelson (the evasion principle), such as to justify lifting the corporate veil and imposing joint and several liability on Magna Prima for Everhall's commission obligations. k) Whether GT Nelson has established the underlying merit of its commission claim against Everhall under the Letter of Appointment dated 15.6.2020 (including the validity of the contract, performance of obligations, effective causation of the RM56 million sale to Cowboy (KL) Sdn Bhd, and entitlement to RM1,680,000 commission), such that Everhall remains liable notwithstanding the Judgment in Default dated 30.12.2023. [47] The court’s analysis will be structured on the framed issues above. The Issues to be Tried as filed will be revisited for determination upon the court’s findings being made on the issues above framed by this court. ANALYSIS AND FINDINGS OF THE COURT Preliminary Matter: Scope of Issues to be Tried [48] At the outset, I must address a preliminary objection raised by Magna Prima that GT Nelson's written submissions failed to address Issues No. 5 and No. 7 from the Agreed Issues to be Tried. [49] GT Nelson's counsel submitted that Issue No. 5 (whether Magna Prima is jointly liable with Everhall) is not omitted but is implicitly addressed through the four main issues raised in GT Nelson's submissions regarding corporate veil lifting. Counsel argued that if the court finds in favour of GT Nelson on corporate veil lifting, joint liability automatically follows. [50] GT Nelson's counsel further submitted that Issue No. 7 (whether GT Nelson fulfilled all terms of the Letter of Appointment) need not be specifically addressed because Magna Prima's Defence only pleads “separate legal entity” as a defence. Magna Prima did not plead that GT Nelson failed to comply with the terms of the appointment. Accordingly, Magna Prima is estopped from raising non-compliance as a defence at the submission stage. [51] Magna Prima's counsel responded that parties cannot unilaterally depart from issues that have been agreed pursuant to Order 34 Rule 2(2)(k) of the Rules of Court

Counsel cited Qi Qiaoxian & Anor v Sunway Putra Hotel Sdn Bhd [2024] 4 MLRA 49 (CA) and Lim Mei Jin v Loh Yuen Tuck [2024] MLRHU 1298 (HC) for the proposition that parties are bound by their pleadings and the agreed issues for trial. A defendant should not be allowed to raise issues which were not pleaded in the defence or agreed in the issues to be tried. [52] However, Magna Prima's counsel submitted that Issue No. 7 goes to the fundamental question of whether any obligation to pay commission exists in the first place. Whether a document is valid in accordance with provisions of law is a question of law that need not be excessively pleaded. Furthermore, during cross-examination of PW2, the validity and compliance issues were raised without objection from GT Nelson. [53] Having considered the submissions, I find merit in both positions to varying degrees. On Issue No. 5, I accept that GT Nelson has implicitly addressed the question of joint liability through its substantive arguments on corporate veil lifting. If the corporate veil is lifted, joint and several liability naturally follows. This issue need not be separately addressed as an independent matter. [54] On Issue No. 7, however, the matter requires more careful consideration. While it is true that parties are bound by the agreed issues to be tried, the principle in Qi Qiaoxian does not operate as an absolute bar to all matters not specifically pleaded. Questions of law, particularly those going to admissibility and validity of documents, may be raised even where not explicitly pleaded, provided they are raised during trial and the opposing party has opportunity to respond. [55] In the present case, the validity of the Letter of Appointment under the Stamp Act 1949 and the Valuers, Appraisers and Estate Agents Rules 1986 were raised during cross-examination of GT Nelson's witnesses. GT Nelson did not object to these lines of questioning. Moreover, these issues go to the fundamental question of whether a valid and enforceable contract exists which is a matter the court must determine regardless of how it is pleaded. [56] Furthermore, Magna Prima's pleading that it is a “separate legal entity” can reasonably be read as raising the defence that Magna Prima has no contractual relationship with GT Nelson and no obligation to pay commission. Whether GT Nelson complied with the terms of the contract with Everhall is relevant to determining whether a commission obligation exists that could potentially be extended to Magna Prima through corporate veil lifting. [57] I therefore find that Issue No. 7 is properly before the court and must be addressed in these grounds. However, I will address this issue within the context of my substantive analysis rather than as a separate standalone issue, as it is integrally connected to the questions of whether a valid commission claim exists and whether the corporate veil should be lifted. Admissibility of the Letter of Appointment under the Stamp Act 1949 Submissions of Magna Prima [58] Magna Prima submits that the Letter of Appointment is inadmissible as evidence because it was not properly stamped in accordance with the Stamp Act 1949. Magna Prima contends that the Letter of Appointment falls within Item 22 of the First Schedule to the Stamp Act 1949, which deals with “Bond, Covenant, Loan, Services, Equipment Lease Agreement or Instrument of any kind whatsoever” being “the only or principal or primary security for any sum of money”. [59] According to Magna Prima, the consideration for the Letter of Appointment was RM1,680,000.00 (being 3% commission on a RM56 million sale), and ad valorem stamp duty should have been paid on this amount. However, the document states the consideration as “zero”. Magna Prima argues this was deliberately done by GT Nelson after the trial commenced when the actual sale price was already known. [60] Magna Prima relies on Section 52(1) of the Stamp Act 1949, which provides: “(1) No instrument chargeable with duty shall be admitted in evidence for any purpose by any person having, by law or consent of parties, authority to receive evidence, or shall be acted upon, registered, or authenticated by any such person or by any public officer, unless such instrument is duly stamped:- Provided that— “1.

any such instrument shall, subject to all just exceptions, be admitted in evidence on payment of the duty and the penalty, if any, chargeable in respect thereof under section 43 or section 47A.” [61] Magna Prima submits that the document is fatal to GT Nelson's entire claim because without a valid Letter of Appointment, there is no basis for the commission claim. Submissions of GT Nelson [62] GT Nelson submits that the Letter of Appointment falls under Item 4 of the First Schedule to the Stamp Act 1949, which deals with “Agreement or Memorandum of an Agreement” and attracts a fixed duty of RM10.00 regardless of the consideration amount. [63] GT Nelson argues that Item 22 does not apply because the Letter of Appointment is not “the only or principal or primary security for any sum of money”. Item 22 covers agreements where the document itself serves as security for payment, such as bonds, debentures, or secured service agreements. The Letter of Appointment is simply an agency agreement creating contractual obligations, not a security instrument. [64] Furthermore, GT Nelson submits that at the time the Letter of Appointment was signed on 15.6.2020, the consideration was genuinely unknown. The document correctly stated “as to value” because the sale price and therefore the commission amount had not been determined. The eventual sale at RM56 million only occurred in May 2021, nearly a year later. It was therefore proper to state the consideration as “zero” or “as to value” when the document was signed. [65] GT Nelson also points to industry practice whereby estate agent appointment letters are typically stamped with fixed duty under Item 4 rather than ad valorem duty under Item

This is the established practice throughout the real estate agency industry in Malaysia. Analysis and Findings [66] I have carefully considered the competing submissions on this issue. In my judgment, the Letter of Appointment dated 15.6.2020 is properly classified under Item 4 of the First Schedule to the Stamp Act 1949, not Item 22 as contended by Magna Prima. [67] Item 4 provides for “Agreement or Memorandum of Agreement made under hand only, and not otherwise specially charged with any duty, whether the same be only evidence of a contract or obligatory upon the parties from its being a written instrument.” The prescribed duty for such an agreement is a fixed duty of RM10.00.” [68] Item 22 provides for “BOND, COVENANT, LOAN, SERVICES, EQUIPMENT LEASE AGREEMENT OR INSTRUMENT of any kind whatsoever - (1) Being the only or principal or primary security for any annuity (except upon the original creation thereof by way of sale or security, and except a superannuation annuity), or for any sum or sums of money at stated periods, not being interest for any sum secured by a duly stamped instrument, nor rent reserved by a lease or tack...”. [69] The critical phrase in Item 22(1) is “Being the only or principal or primary security for any annuity... or for any sum or sums of money at stated periods”. Relying on the definition in Muhibbah Engineering (M) Bhd v Pemungut Duti Setem [2017] 6 MLJ 564 (CA), this language indicates that Item 22 is intended to capture documents that serve a security function which is defined as an “encumbrance... over the property of his debtor... for the purpose of securing the repayment of a debt”. Examples cited include mortgages, pawns, floating charges, and liens. [70] The Letter of Appointment in the present case does not serve such a security function. It is simply an agency appointment contract whereby Everhall engaged GT Nelson to provide property marketing services in exchange for commission upon successful completion. The document creates primary contractual obligations; it does not secure performance of existing obligations through secondary recourse mechanisms. [71] I am fortified in this view by examining the structure and purpose of the two Items. Item 4 is the general provision capturing ordinary commercial agreements. Item 22 is a special provision for security instruments where the quantum of money secured can be substantial and variable, hence the ad valorem duty structure. An estate agency appointment letter is quintessentially an ordinary commercial service agreement, not a security instrument. [72] Magna Prima's argument that the document falls under Item 22 conflates the concept of contractual obligation with the concept of 'security'. Relying on Muhibbah Engineering, GT Nelson argues that 'security' implies an encumbrance over property, whereas the Letter of Appointment merely describes the obligations of the parties. It does not function as a security for an annuity or for sums of money at stated periods as required by Item 22(1). If Magna Prima's interpretation were correct, it would render Item 4, which applies to agreements not otherwise specially charged, inapplicable to standard service agreements. [73] Furthermore, industry practice strongly supports classification under Item 4. It is common ground that estate agency appointment letters throughout Malaysia are routinely stamped with fixed RM10.00 duty under Item 4. The Stamp Office has accepted this practice for decades. While established practice is not conclusive on questions of statutory interpretation, it is a relevant consideration, particularly where the practice has been long-standing and widely accepted by the revenue authorities. [74] On the question of whether the consideration was properly stated, I find that GT Nelson's approach was legally sustainable. Although the Stamp Certificate recorded the consideration as “RM 0.00”, this accurately reflected the nature of the Letter of Appointment at the time of its execution on 15.6.2020. At that material time, no purchaser had been identified and no purchase price had been agreed, meaning the 3% commission was unquantifiable. The Stamp Act imposes duty on the instrument as it stands at execution, not on future contingent amounts. [75] Although the eventual sale occurred nearly a year later at RM56 million, and the document was stamped retrospectively, GT Nelson was entitled to rely on Item 4 of the Stamp Act (Agreement made under hand only). Under this Item, the duty is a fixed RM10.00 regardless of the consideration amount. Therefore, the entry of “RM 0.00” does not invalidate the admissibility of the document, as the quantum of consideration is immaterial to the fixed duty payable. [76] Even if I were wrong on the classification issue and Item 22 applied, I would still not exclude the document from evidence at this stage. Section 52(1) Proviso (a) of the Stamp Act provides that an instrument may be admitted in evidence on payment of the duty and the penalty. [77] The Letter of Appointment here is a general agreement. The principle established in Malayan Banking Bhd. v. Agencies Service Bureau Sdn. Bhd. & Ors [1981] 1 MLRA 152 (FC) is that such documents are not void ab initio but merely inadmissible until proper stamping is effected. [78] However, it must be noted that there was a significant lapse of time of over 5 years before the document was stamped (retrospectively after trial). Furthermore, the Defendant has raised the issue that the consideration was recorded as “RM

0.00”, suggesting a potential intent to evade the full ad valorem duty. Nevertheless, justice would be served by allowing the document to be properly stamped with the correct duty if necessary, rather than striking out the entire claim on a technicality. [79] Furthermore, it must be remembered that the Letter of Appointment was issued by Everhall, not by GT Nelson. If there were any deficiency in stamping, it would be attributable to the party who prepared and issued the document, namely Everhall acting through Thiruchelvam. It would be inequitable to visit upon GT Nelson the consequences of any stamping deficiency created by the opposing party. [80] For all these reasons, I find that the Letter of Appointment is admissible as evidence in these proceedings. I therefore reject Magna Prima's submission that the claim must fail on grounds of inadmissibility. Validity of the Letter of Appointment under the Valuers, Appraisers and Estate Agents Rules 1986 Submissions of Magna Prima [81] Magna Prima submits that the Letter of Appointment is invalid because it was not signed by a Registered Estate Agent as required by Rule 102 of the Valuers, Appraisers and Estate Agents Rules 1986. The signatory on behalf of GT Nelson was Andy Lim, who is only a Real Estate Negotiator (REN), not a Registered Estate Agent (REA). [82] Rule 102 provides: “(1) A registered estate agent's name signature and registration number shall appear on all proposals, reports and other documentation prepared by him indicating his status as a registered estate agent.

Without prejudice to paragraph (1), all reports and documents regarding professional instructions, options, professional advice to a client, offers to sell, purchase or let property, letters of acceptance, professional fees, the commission of negotiators and other professional matters shall require the signature and registration number of the registered estate agent.

No person shall be allowed to represent the registered estate agent in any documentation or correspondence unless it is for administrative purposes only.” [83] Magna Prima submits that this is a mandatory requirement and failure to comply renders the agreement invalid ab initio. During cross-examination, Andy Lim admitted that he was not a Registered Estate Agent and that his signature on the Letter of Appointment did not bear any REA registration number. Andy Lim further admitted that as a negotiator his authority was limited and he did not have authority to sign documents on behalf of the estate agent. He confirmed there was no document before the court showing that the estate agent had given him authority to sign documents on their behalf. [84] Magna Prima submits that GT Nelson did not re-examine Andy Lim on this point, and therefore it is admitted that Andy Lim did not have authority to sign the Letter of Appointment on behalf of GT Nelson. GT Nelson also did not call the registered estate agent to testify that the estate agent subsequently ratified Andy Lim's action. Magna Prima relies on Section 22C of the Valuers, Appraisers, Estate Agents and Property Managers Act 1981, which provides that a negotiator may only “assist the registered estate agent in the estate agency practice” and that only registered estate agents may practice or carry on business as estate agents or undertake estate agency work. Magna Prima submits that the signing of the Letter of Appointment by a non-registered estate agent is forbidden by law, rendering it void and unenforceable. [85] Magna Prima argues that this is a question of law that can be raised at any time and does not require explicit pleading. The validity of a document according to law is always before the court regardless of the pleadings. The issue was properly raised during cross-examination without objection from GT Nelson, and Andy Lim admitted the relevant facts. Submissions of GT Nelson [86] GT Nelson submits that Magna Prima is estopped from raising this defence because it was not pleaded in the Defence. GT Nelson's position, articulated during the oral clarification hearing, is that whether Andy Lim had authority to sign or not should have been raised as a material defence in Magna Prima's pleadings, which it was not. GT Nelson submits that regardless of this issue being raised in submissions, it should not be considered by the court at all. [87] GT Nelson relies on the Court of Appeal decision in Qi Qiaoxian & Anor v Sunway Putra Hotel Sdn Bhd [supra], which held that a defendant should not be allowed to raise issues which had not been pleaded in the defence and which had not been previously agreed to by parties in the agreed issues to be tried. To allow otherwise would amount to trial by ambush and would cause injustice to GT Nelson. Analysis and Findings [88] This issue requires careful consideration of both the legal effect of Rule 102 and the principles governing pleadings and estoppel. [89] I begin with the scope and effect of Rule 102. This rule is found within the Valuers, Appraisers and Estate Agents Rules 1986, which were made pursuant to Section 32 of the Valuers, Appraisers and Estate Agents Act 1981. Rule 102(2) specifically requires that “all reports and documents regarding professional instructions, options, professional advice to a client, offers to sell, purchase or let property, letters of acceptance, professional fees, the commission of negotiators and other professional matters shall require the signature and registration number of the registered estate agent.” [90] The language of Rule 102(2) is prescriptive - such documents “shall require” the signature and registration number of the registered estate agent. Rule 102(3) further provides that “no person shall be allowed to represent the registered estate agent in any documentation or correspondence unless it is for administrative purposes only.” The signing of an estate agency appointment letter is clearly not an administrative matter but goes to the substance of the professional engagement. [91] However, the rule does not expressly state that failure to comply renders the agreement void or unenforceable as between the contracting parties. This is significant because where Parliament intends non-compliance with a provision to result in invalidity, it typically says so expressly. The rule may be directed at regulating the conduct of estate agents and negotiators, with enforcement through disciplinary proceedings, rather than rendering contracts void. [92] In the absence of express language declaring agreements invalid for Rule 102 non-compliance, I must determine whether invalidity is an implied consequence. The established principle is that regulatory requirements do not necessarily void contracts for non-compliance unless the statute evinces a clear intention that contracts made in breach should be unenforceable. The purpose of the rule must be examined to determine whether invalidity is the intended consequence. [93] Rule 102 serves important regulatory purposes: it enables clients to identify and verify their agent's credentials; it facilitates regulatory oversight and enforcement; and it promotes accountability in the estate agency industry. However, these purposes can be adequately served through other enforcement mechanisms such as disciplinary action, fines, or suspension of registration. There is no evident policy reason why the contract itself should be void, particularly where this would prejudice innocent third parties who performed services in good faith. [94] Furthermore, Section 22C(2)(d) of the Act expressly contemplates that negotiators may “assist the registered estate agent in the estate agency practice.” While negotiators' powers are limited, the statutory scheme recognises their role in estate agency operations. The question is whether a negotiator's signature on an appointment letter, in circumstances where he is clearly acting on behalf of a corporate estate agency firm, renders the entire contract void. [95] In the present case, there are additional factors that weigh against finding the Letter of Appointment invalid. First, the document was not prepared by GT Nelson but by Everhall through Thiruchelvam. If there were any deficiency, it originated from the opposing party. Second, GT Nelson Realty is itself a corporate estate agency. The fact that the signatory was a REN rather than an REA may reflect the internal division of signing authority within the corporate structure. Third, Everhall and Magna Prima proceeded with the entire transaction knowing Andy Lim's role and status, without raising any objection until this litigation arose. [96] On the pleading point, I accept that Magna Prima's Statement of Defence does not explicitly plead invalidity under Rule 102. GT Nelson's position that this defence was not pleaded and therefore should not be considered has merit. However, I am cognisant that questions of law, particularly those relating to the validity of documents, may be raised even if not specifically pleaded, provided the opposing party has opportunity to respond. In this case, the issue was raised during cross-examination and GT Nelson had ample opportunity to address it in submissions. [97] Nevertheless, the authorities cited by GT Nelson on parties being bound by their pleadings are important. The principle in Qi Qiaoxian is that parties should not be allowed to take opponents by surprise with new issues at the submission stage. However, that principle must be balanced against the court's duty to apply the law correctly. [98] Having weighed these competing considerations, my conclusion is as follows. Even if Rule 102 applied strictly to the present case and even if non-compliance were established, I would not find the Letter of Appointment void or invalid as between the contracting parties. At most, non-compliance with Rule 102 might constitute a regulatory breach by GT Nelson company or its negotiator, potentially subjecting them to disciplinary proceedings under the Act. But it would not render the contract void as between the parties, particularly where the other party prepared the document and proceeded with the transaction without objection. [99] Furthermore, and most significantly, the conduct of Everhall and Magna Prima demonstrates clear acceptance and acknowledgment of the appointment. Everhall issued the Letter of Appointment. Both Defendants proceeded with the sale transaction with full knowledge of GT Nelson's involvement. They attended meetings with Andy Lim. They completed the Sale and Purchase Agreement without objection. Such conduct amounts to waiver of any technical irregularity and estops the Defendants from now asserting invalidity. [100] For all these reasons, I reject Magna Prima's submission that the Letter of Appointment is invalid due to Rule 102 non-compliance. Whether the Letter of Appointment Expired Before the Sale was Completed Submissions of Magna Prima [101] Magna Prima submits that the Letter of Appointment expired on 15.9.2020, being 3 months from the date of appointment on 15.6.2020. The Sale and Purchase Agreement was only executed on 3.5.2021, some 7.5 months after the expiry date. GT Nelson cannot rely on an expired contract to claim commission for a sale that occurred outside the appointment period. [102] Magna Prima emphasises that if GT Nelson truly procured a purchaser during the appointment period, they should have requested a written extension from Everhall given the delays in completing the transaction. The fact that no extension was ever requested demonstrates that GT Nelson did not fulfill its obligations during the appointment period. [103] Clause 5 of the Letter of Appointment provides that GT Nelson's services would be deemed completed “upon full compliance with item (4) above”. Clause 4(b)(iii)(b) required the Sale and Purchase Agreement to be signed within 14 days from the date of booking. The evidence shows a delay of 294 days between the 2% deposit payment (circa August 2020) and the signing of the Sale and Purchase Agreement (3.5.2021). This represents a material breach of the contractual terms. Submissions of GT Nelson [104] GT Nelson submits that the appointment was extended by the conduct of the parties. The critical evidence is that both Everhall and Magna Prima proceeded to complete the Sale and Purchase Agreement in May 2021, long after the stated expiry date, without ever raising the expiry as a ground for refusing to pay commission. [105] The 29.12.2020 meeting is particularly significant. This meeting occurred after the purported expiry date of 15.9.2020. Yet the meeting was attended by senior representatives from both Defendants, including Datuk Rahdian (director of both companies) and Vikram (legal manager of Magna Prima). The purpose of the meeting was to discuss the sale transaction. Andy Lim was present representing GT Nelson. No one at this meeting raised any objection that GT Nelson's appointment had expired. [106] Furthermore, Thiruchelvam continued to liaise with Andy Lim throughout the period leading to completion of the Sale and Purchase Agreement. WhatsApp communications demonstrate ongoing coordination between GT Nelson and the Defendants' representatives well beyond September

This conduct demonstrates acceptance of an extended appointment period. [107] The delay in signing the Sale and Purchase Agreement was not attributable to GT Nelson but rather to factors beyond GT Nelson's control, including: the need for board resolutions from Magna Prima approving the disposal; COVID-19 pandemic restrictions and Movement Control Orders; and administrative processing by the purchaser and the banks. GT Nelson cannot be penalised for delays caused by the Defendants' own internal approval processes or by external factors such as the pandemic. [108] GT Nelson also submits that the Defendants cannot take advantage of their own delay. The need for Magna Prima's board approval before Everhall could sign the Sale and Purchase Agreement caused much of the delay. Having inserted this requirement into the process, the Defendants cannot then assert that GT Nelson's appointment expired during the delay period. Analysis and Findings [109] This issue requires me to determine whether the Letter of Appointment remained effective at the time the Sale and Purchase Agreement was completed on 3.5.2021. [110] The express terms of the Letter of Appointment are clear: the appointment period was “3 months from the of appointment i.e. 15th June 2020”. On its face, this means the appointment expired on 15.9.2020. [111] However, contracts do not exist in a vacuum. The question is not merely what the written terms state, but how the parties understood and applied those terms through their subsequent conduct. It is well-established that parties may extend or vary contractual terms through their conduct, even without formal written amendment. [112] The evidence in this case demonstrates overwhelmingly that both Defendants treated GT Nelson's appointment as continuing well beyond September 2020. The most significant evidence is the 29.12.2020 meeting. This meeting occurred at least three months after the stated expiry date. Yet representatives from both Defendants attended specifically to discuss the property sale transaction with representatives from the Cowboy group. Andy Lim from GT Nelson was present at this meeting. His presence was not challenged. His role was not questioned. The entire purpose of the meeting was to facilitate completion of the sale that GT Nelson had initiated. [113] If the Defendants truly believed that GT Nelson's appointment had expired in September 2020, they would surely have raised this at the 29.12.2020 meeting. They would have questioned Andy Lim's presence. They would have refused to include him in discussions. But they did none of these things. Instead, they actively participated in a meeting that implicitly recognised GT Nelson's ongoing involvement in the transaction. [114] Furthermore, the Sale and Purchase Agreement was eventually executed on 3.5.2021 - a full 7.5 months after the stated expiry date. Even after signing this agreement, the Defendants did not immediately repudiate any obligation to GT Nelson. It was only when GT Nelson issued invoices in December 2022 and January 2023 seeking payment of commission that the issue of expiry was raised. This constitutes acquiescence and waiver. [115] The principle is clear: where parties continue to act upon a contract after its stated expiry date, treating it as subsisting, and where the other party relies upon such conduct to its detriment, the parties are taken to have extended or varied the contract by their conduct. The Defendants cannot blow hot and cold - accepting the benefit of GT Nelson's services in procuring the purchaser, completing the sale with GT Nelson's involvement, and then later repudiating the obligation to pay commission on the ground that the appointment had expired. [116] The evidence of Thiruchelvam's continued communications with Andy Lim beyond September 2020 further supports this finding. These communications demonstrate ongoing coordination and cooperation in advancing the sale transaction. Such conduct is inconsistent with a position that the appointment had terminated. [117] On the question of the 294-day delay in signing the Sale and Purchase Agreement after the 2% deposit, I find that this delay was not caused by any breach or failure on the part of GT Nelson. The evidence, including the testimony of Lim Kian Siew (PW3) from Cowboy (KL) Sdn Bhd, establishes that the delay was attributable to several factors: a) The need for board resolution from Magna Prima approving the disposal of the Property. This was an internal requirement of the Defendants' corporate governance procedures; b) The COVID-19 pandemic and Movement Control Orders imposed by the Government, which restricted business operations and delayed administrative processes throughout the relevant period; and c) Banking and financing arrangements that needed to be put in place by the purchaser. [118] None of these factors was within GT Nelson's control. GT Nelson introduced the purchaser. The purchaser expressed interest and paid a deposit. Thereafter, the timing of completing the formal Sale and Purchase Agreement depended on matters beyond GT Nelson's remit. Estate agents cannot be expected to control their principals' internal approval processes or to overcome force majeure events such as a global pandemic. [119] Clause 4(b)(iii)(b) of the Letter of Appointment, which contemplates signing within 14 days, must be read realistically and in context. This is a target timeline, not an inflexible condition precedent that automatically terminates the agent's entitlement if breached. In normal commercial practice, delays in completing property transactions are common and do not necessarily vitiate the agent's right to commission, particularly where the agent was the effective cause of the sale and where the delays were not attributable to the agent's failure. [120] I am fortified in this conclusion by the principle that estate agents are entitled to commission if they are the “effective cause” of the sale, even if there are delays or intervening events in completing the transaction. The test is whether the agent's introduction and efforts resulted in the sale, not whether every timeline was precisely met. [121] In the present case, there is no dispute that GT Nelson was the effective cause of the sale. GT Nelson introduced the Cowboy group. The property was ultimately sold to an entity within that group at the price of RM56 million. The chain of causation from GT Nelson's efforts to the completed sale is unbroken. The mere fact that completion took longer than anticipated does not negate GT Nelson's entitlement to commission. [122] For all these reasons, I find that the Letter of Appointment remained effective through the parties' conduct until completion of the Sale and Purchase Agreement on 3.5.2021. Alternatively, even if the appointment technically expired, the Defendants are estopped from relying on the expiry by reason of their conduct in continuing to treat the appointment as subsisting. GT Nelson is entitled to claim commission for the completed sale. Whether GT Nelson Procured the Purchaser Submissions of Magna Prima [123] Magna Prima submits that GT Nelson has failed to prove it procured Cowboy (KL) Sdn Bhd, which was the actual purchaser named in the Sale and Purchase Agreement dated 3.5.2021. The letter of interest dated 13.7.2020 came from a different entity: Super Cowboy Wholesale (BP) Sdn Bhd. These are two separate legal entities. [124] Furthermore, Cowboy (KL) Sdn Bhd was only incorporated on 11.8.2020, which was after the letter of interest was issued on 13.7.2020. It was physically impossible for GT Nelson to have procured Cowboy (KL) Sdn Bhd before it even existed as a legal entity. [125] GT Nelson has not provided any evidence that Cowboy (KL) Sdn Bhd was acting as a nominee or agent for Super Cowboy Wholesale (BP) Sdn Bhd, or that there was any legal relationship between these two entities that would justify treating them as one and the same for purposes of the commission claim. [126] During cross-examination, Andy Lim admitted the discrepancy between the entity named in the letter of interest and the ultimate purchaser. He could not adequately explain why a different entity ended up purchasing the property. Submissions of GT Nelson [127] GT Nelson submits that all the “Cowboy” companies are part of the same corporate group controlled by the same family of shareholders and directors. Super Cowboy Wholesale (BP) Sdn Bhd, Super Cowboy Trading Sdn Bhd, and Cowboy (KL) Sdn Bhd are all owned and controlled by members of the Teoh family. [128] The evidence from Lim Kian Siew (PW3), a director of Cowboy (KL) Sdn Bhd, explains the commercial reality. Several companies within the Cowboy group were interested in acquiring the property. At the initial stage, it had not yet been decided which entity would be used as the purchasing vehicle. The letter of interest from Super Cowboy Wholesale (BP) Sdn Bhd was issued to secure the opportunity while the internal decision-making process continued. [129] Subsequently, for reasons relating to the group's internal structuring and business operations, the decision was made to use Cowboy (KL) Sdn Bhd as the purchasing entity. Cowboy (KL) Sdn Bhd was incorporated for this specific purpose, with shareholding distributed among five companies within the Cowboy group including Super Cowboy Wholesale (BP) Sdn Bhd. [130] The important point is that GT Nelson introduced the Cowboy group to the opportunity. The property was ultimately purchased by an entity within that group. The 2% deposit paid in August 2020 came from the Cowboy group. The sale completed at the price indicated in the letter of interest. GT Nelson was the effective cause of this sale. [131] To deny commission on the technical ground that the ultimate purchaser was a different legal entity within the same group would elevate form over substance and would be contrary to commercial reality. Estate agents deal with corporate groups that may restructure their purchasing arrangements for legitimate commercial or tax reasons. The agent should not be denied commission merely because the client chose to use a different group entity as the formal purchaser. Analysis and Findings [132] I am required to determine whether GT Nelson successfully procured the purchaser, notwithstanding that the letter of interest came from Super Cowboy Wholesale (BP) Sdn Bhd while the Sale and Purchase Agreement was with Cowboy (KL) Sdn Bhd. [133] As a matter of strict legal analysis, Magna Prima is correct that these are two separate legal entities. Each company has its own separate legal personality. In law, they are distinct persons. This is the fundamental principle of corporate law established since Salomon v A Salomon & Co Ltd [1897] AC 22. [134] However, the question before me is not a pure question of corporate law. It is a question of contractual interpretation and commercial reality in the context of estate agency law. The issue is whether GT Nelson fulfilled its contractual obligation to procure “a purchaser” for the property, such that commission became payable. [135] Agents are generally entitled to commission if they are the “effective cause” of the sale. This is a question of causation: did the agent's introduction and efforts lead to the completed sale? It is not a question of whether the ultimate purchaser is identical in every respect to the initial interested party, but whether there is a sufficient causal nexus between the agent's efforts and the completed transaction. [136] The undisputed facts are these. GT Nelson, through Andy Lim, introduced the opportunity to the Cowboy group of companies. [137] Representatives from the Cowboy group expressed interest through the letter dated 13.7.2020. A 2% deposit was paid by an entity within the Cowboy group in August 2020. The sale completed in May 2021 to Cowboy (KL) Sdn Bhd, another entity within the same group, at the same price of RM56 million that had been indicated in the letter of interest. [138] The evidence from PW3, who is a director of Cowboy (KL) Sdn Bhd, explains the commercial reasons for using different entities at different stages. I accept his evidence that the Cowboy group companies are closely related, being owned and controlled by the same family shareholders, and that internal decisions were made about which specific entity would be used as the purchasing vehicle. [139] Critically, there was no intervention by any other estate agent. No other party introduced the Cowboy group to this opportunity. GT Nelson was the sole agent involved in bringing about this transaction from start to finish. The chain of causation is clear and unbroken. [140] To deny commission in these circumstances would be to elevate legal formalism over commercial substance. Corporate groups commonly restructure their affairs for legitimate commercial, tax, or financing reasons. Purchasers may decide to use different group entities as the formal contracting party. If estate agents could be denied commission whenever there was any variation in the specific legal entity used, it would create uncertainty and injustice in the estate agency industry. [141] Furthermore, both Everhall and Magna Prima were aware of these arrangements. They dealt with representatives from the Cowboy group throughout the process. They attended meetings where the group's structure and arrangements were discussed. They accepted the 2% deposit from the group. They completed the sale to Cowboy (KL) Sdn Bhd without objection. Having proceeded on this basis, they cannot now deny commission on the ground that the wrong entity within the group signed the Sale and Purchase Agreement. [142] I am satisfied that GT Nelson was the effective cause of the sale. GT Nelson introduced the Cowboy group. That introduction led directly to the completed sale at RM56 million. The fact that the formal purchaser was a different entity within the same group does not break the causal nexus. [143] I note that this finding is consistent with the approach taken in other jurisdictions where courts have recognised that estate agents should not be denied commission merely because of legitimate restructuring by the purchaser, provided the agent's introduction was the effective cause of the sale and provided there was no intervention by another agent. See LJ Hooker Ltd v Adams Estates Pty Ltd (1977) 138 CLR 52 (Australian High Court; Burchell v Gowrie [1910] AC 614 (Privy Council); Ryan v Horton [1911] HCA 10 (Australian High Court); Moneywood Pty Limited v Salamon Nominees Pty Limited [2001] HCA 2 (Australian High Court). This accords with commercial common sense and fairness. [144] For all these reasons, I find that GT Nelson successfully procured the purchaser and is entitled to commission in accordance with the terms of the Letter of Appointment. Quantum of Commission [145] Clause 6 of the Letter of Appointment addresses commission entitlement and calculation. It provides: “You shall entitled the sales commission in respect of:-

each and every proposal that is duly accepted by our Company; and

any sums which have been fully paid by the purchaser(s) for the purchase of the unit(s). and in such event calculation will be based on the nett selling price of the property inclusive of 6% Government Tax and/or such other taxes imposed or may be imposed by the Government. For the purpose of this clause:

Sales commission is only payable upon the perfection of Loan Agreement and Deed of Assignment, if any, or execution of an undertaking for cash purchase by buyer(s)

Sales commission is payable to you within 30 days from received of your invoice(s)” [146] Magna Prima raised an argument concerning the proper interpretation of “nett selling price” in Clause 6. Magna Prima submitted that the claim of RM1,680,000.00 (calculated as 3% of RM56,000,000.00) is not consistent with the agreed terms because commission should be based on “nett selling price”, not the gross purchase price. Magna Prima contended that after deducting the redemption amount paid to MBSB Bank Berhad to discharge the charge over the Property, the nett selling price is effectively RM0.00, and therefore no commission is payable. [147] Magna Prima relied on evidence from Lim Kan Siew, a representative from the purchaser Cowboy (KL) Sdn Bhd, who testified that after redemption and settlement of debts, the RM56 million was insufficient to complete the transaction. Magna Prima submitted that this establishes the nett selling price was zero, and commission calculated as 3% of zero equals zero. [148] I reject Magna Prima's interpretation of “nett selling price”. The natural and ordinary meaning of “nett selling price” in the context of a property sale is the actual sale price stated in the Sale and Purchase Agreement, as distinct from any asking price or provisional figure. It does not mean the vendor's profit after deducting its own costs, liabilities, or redemption amounts. If the parties had intended commission to be calculated on the vendor's net proceeds after deducting all encumbrances and obligations, the Letter of Appointment would have said so expressly. The use of the word “nett” in this context serves to distinguish the actual agreed sale price from any provisional or estimated figures, and to clarify that the calculation includes any applicable taxes. [149] The interpretation advanced by Magna Prima would lead to absurd results. It would mean that estate agents could never be certain of their commission entitlement, as it would depend entirely on the vendor's internal financial arrangements and liabilities which are unknown to the agent. An agent who successfully procures a buyer at an agreed price could find itself entitled to zero commission merely because the vendor had chosen to heavily encumber the property with loans. This cannot have been the parties' intention. Estate agents' commission is calculated on the sale price achieved, not on the vendor's net financial outcome from the transaction. GT Nelson is therefore entitled to commission calculated as 3% of RM56,000,000.00, being RM1,680,000.00. Lifting the Corporate Veil Legal Principles [150] I now turn to the central issue in this case: whether the corporate veil should be lifted to hold Magna Prima liable for Everhall's debt to GT Nelson. [151] GT Nelson's claim against Magna Prima is not based on privity of contract. GT Nelson accepts that Magna Prima was not a party to the Letter of Appointment and that there is no direct contractual relationship between GT Nelson and Magna Prima. Instead, GT Nelson invokes the doctrine of lifting the corporate veil, seeking to hold Magna Prima liable for Everhall's obligations on the ground that the corporate structure was abused to evade liability. [152] The starting point is the fundamental principle of separate legal personality. A company, upon incorporation, becomes a legal person distinct from its shareholders, directors, and parent companies. This principle was established in the landmark case of Salomon v A Salomon & Co Ltd and has been the bedrock of company law throughout the common law world for over a century. [153] In Malaysia, this principle is explicitly codified in Section 20 of the Companies Act 2016, which states that a company has a “legal personality separate from that of its members”. Furthermore, Section 21 grants a company “full capacity to carry on or undertake any business or activity”, including the specific powers to “acquire, own, hold... property” and “sue and be sued” in its own name. Consequently, as provided in Section 192, shareholders (members) benefit from limited liability and are not liable for the company's obligations merely by reason of being a member. [154] These principles extend to corporate groups. A parent company and its subsidiary are separate legal entities. The fact that one company owns shares in another does not make them one and the same person in law. Each maintains its separate legal personality. [155] However, the doctrine of separate legal personality is not absolute. In exceptional circumstances, courts will “lift” or “pierce” the corporate veil to look behind the legal form and identify the true controller or beneficiary. This is sometimes necessary to prevent abuse of the corporate form and to ensure that justice is done. [156] The circumstances in which the veil may be lifted have been the subject of extensive judicial consideration. The law in Malaysia has recently been clarified and developed by the Federal Court's decision in Ong Leong Chiou & Anor v Keller (M) Sdn Bhd & Ors [2021] 4 CLJ 821. [157] In Ong Leong Chiou, the Federal Court conducted a comprehensive review of the English authorities on corporate veil lifting, with particular focus on the decision of the United Kingdom Supreme Court in Prest v Petrodel Resources Ltd [2013] 2 AC 415. The Federal Court adopted and applied the analytical framework established in Prest, which distinguishes between the “concealment principle” and the “evasion principle”. [158] The relevant passages from Ong Leong Chiou are instructive and merit extended quotation. At paragraph 99(i), Nallini Pathmanathan FCJ stated: “It is the essence of incorporation that the shareholder/controller of the company limits his liability in respect of the future conduct of the company's affairs. There is nothing wrong with that. Advantage is taken of limited liability to avoid personal liability if things go wrong. (see Persad v Singh per Lord Neuberger [2017] UKPC 32). However, the limitation of liability envisages that such future conduct of the company's business is to be conducted honestly and with integrity - the law is predicated on that assumption. Once honesty is abandoned and the company is utilised as a vehicle for dishonest conduct, or fraud, or unconscionable conduct, then the basis for the separate corporate personality is jeopardised and undermined. It no longer serves the purpose it was intended for. As such it is only correct that a court investigating the injury or loss suffered by reason of the wrongful utilisation of the corporate personality, or the abuse of the corporate personality, is allowed to both look behind the facade to ascertain the true facts and also impose liability against the persons perpetrating such wrongdoing as is required on the facts of a particular case. This body of law relating to fraud subsists outside of the doctrine of 'piercing' the corporate veil as explained in Prest.” [159] Further at paragraph 99(ii), the Federal Court addressed the analytical framework: “I would respectfully concur with the legal rationale prescribed by Lord Sumption in Prest, which explains that in order to ascertain whether the veil of incorporation ought to be 'pierced', the nature of the wrongdoing in issue ought to be analysed to ascertain whether it falls within the purview of the 'concealment' principle or the 'evasion' principle. To this end, the distinction between the two principles of concealment and evasion are of importance and benefit to enable a court to analyse with greater accuracy the basis on which the corporate personality is being disregarded. It also results in different consequences as explained earlier.” [160] The Federal Court explained the distinction between concealment and evasion. At paragraph 99(iii), it addressed the concealment principle: “The analysis in Prest, namely that the concealment principle does not in reality pierce the veil of incorporation, but allows the court to disregard or look behind the corporate personality to ascertain the true facts, ought to be considered for use and application in this jurisdiction. The reason is because after ascertaining the true facts concealed behind the corporate personality, it will enable a court to determine which legal principle of substantive law it will then utilise to determine whether liability subsists, or does not subsist, against a party to the dispute, on a given set of facts. This may involve the utilisation of the principles of agency or trusts or some other area of the law. Such application allows for a greater analysis of the basis on which liability is imposed, rather than simply stating that the corporate veil has been lifted and imposing liability on a party without explaining the legal basis for doing so. It is also important to note that it does not engage the evasion principle such that the corporate veil is not pierced.” [161] At paragraph 99(iv), the Federal Court addressed the evasion principle: “If the wrongdoing warrants the application of the evasion principle, the consequence is that the corporate veil is pierced, so as to enable liability to be imposed on a person, seemingly unconnected to the transaction in dispute. First, it is necessary to ascertain if there is a legal right against the person in control of a company which exists independently of the company's involvement, and a company is interposed such that the legal personality of the company defeats the legal right or frustrates its enforcement. This is a considerable obstacle to overcome, and it is only rarely that an appropriate set of facts will allow for such 'piercing'. Ultimately, the narrow and rigid test ensures that the corporate personality is not lightly disregarded. Even when the facts of a particular case warrant invoking the evasion principle enabling the corporate veil to be pierced, the court may only apply the doctrine to deprive the company or its controller of the advantage that they would otherwise have obtained by the company's separate legal personality.” [162] The Federal Court emphasised that the evasion principle is narrow and will only be applied in exceptional circumstances. The concealment principle, by contrast, does not actually pierce the veil - it merely allows the court to look behind the corporate structure to ascertain the true facts, after which normal principles of law (such as agency, trust, or estoppel) are applied to determine liability. [163] GT Nelson in the present case also relies on Teh Swee Neo & Anor v CCRM Management Sdn Bhd & Anor [2024] CLJU

In that case, the plaintiffs were owners of commercial units in a shopping mall known as “Capital City Mall”. The first defendant (CCRM Management Sdn Bhd, formerly known as Capital City Retail Management Sdn Bhd) was the tenant under a Tenancy Agreement. The second defendant (Capital City Property Sdn Bhd) was the developer of the shopping mall. The plaintiffs claimed unpaid rent from the first defendant and sought to lift the corporate veil to hold the second defendant liable on the basis that the first defendant was the alter ego of the second defendant. [164] The High Court in Teh Swee Neo applied the principles from Ong Leong Chiou and found that the corporate veil should be lifted. The critical findings were: a) The second defendant had sold its shares in the first defendant to another party for only RM100.00; b) The first defendant changed its name from “Capital City Retail Management Sdn Bhd” (which contained the phrase “Capital City”) to “CCRM Management Sdn Bhd” to distance itself from the project; c) The common director of both companies resigned from the first defendant; d) These steps were taken to enable the second defendant to distance itself from the first defendant and from liability under the Tenancy Agreement; e) The first defendant was found to be a “mere nominal company” or “shell” company incorporated by the second defendant through their common director at the material time; f) The second defendant had “effective control” over the first defendant at the material time. [165] From these authorities, I distil the following legal principles applicable to the present case: a) The doctrine of separate legal personality is fundamental and must be respected as the starting point; b) The corporate veil will only be lifted in exceptional circumstances where there is abuse of the corporate form; c) Mere parent-subsidiary relationship is insufficient. The fact that one company owns or controls another does not justify lifting the veil; d) Under the concealment principle, the court may look behind the corporate structure to ascertain true facts, but this does not pierce the veil. The court then applies ordinary legal principles (such as agency or trust) to determine liability; e) Under the evasion principle, the court may pierce the veil where a company is interposed to evade an existing legal obligation, but this is a narrow doctrine requiring exceptional circumstances. There must be an existing legal right or obligation that is being defeated or frustrated by the interposition of the company; and f) Factors relevant to determining whether to lift the veil include: whether the company was established as a façade or sham; whether it lacks independent business operations and is merely a nominal or shell company; whether it was used to conceal the true controller; whether it was specifically interposed to evade existing legal obligations; and whether the facts demonstrate that the controller exercised such dominance that the company had no independent existence. [166] With these principles in mind, I now turn to analyse whether the corporate veil should be lifted in the present case. GT Nelson's Arguments on Concealment and Evasion [167] GT Nelson submits that both the concealment principle and the evasion principle apply in this case. GT Nelson's arguments may be summarised as follows. [168] First, Magna Prima was in full control of Everhall at all material times. As the sole shareholder and parent company, Magna Prima controlled all aspects of Everhall's business, including the property disposal transaction. [169] Second, the evidence shows that Magna Prima was directly involved in and had full knowledge of the appointment and the transaction. Thiruchelvam, who handled all aspects of the appointment and sale, was an employee of Magna Prima (specifically Magna Prima Development Sdn Bhd, a subsidiary of Magna Prima). Datuk Rahdian, who was a director of both companies, knew about the transaction and the commission claim. Vikram, the legal manager of Magna Prima, was involved in the transaction and attended the December 2020 meeting. Magna Prima's board provided approval for the property disposal. [170] Third, Magna Prima received the benefit of the RM56 million proceeds from the property sale. The proceeds are reflected in Magna Prima's consolidated financial statements. The sale improved Everhall's financial position, which in turn improved Magna Prima's consolidated group position by removing a distressed subsidiary asset. [171] Fourth, GT Nelson points to Magna Prima's Bursa announcement dated 14.2.2022, which disclosed the property disposal and stated it was expected to result in an estimated loss of approximately RM0.4 million. GT Nelson argues this announcement demonstrates Magna Prima treated the disposal as a group matter affecting its own financial position. [172] Fifth, and most significantly, Magna Prima deliberately disposed of Everhall for a nominal sum of RM50.00 shortly after the property sale was completed. At the time of disposal on 5.5.2022, GT Nelson's commission claim was known to both Defendants. By selling Everhall to a third party for RM50.00, Magna Prima effectively washed its hands of the liability and left GT Nelson with a judgment against a shell company with negative net assets. [173] GT Nelson submits that this pattern of conduct, namely controlling the transaction, benefiting from the proceeds, and then disposing of Everhall for a nominal sum, demonstrates both concealment and evasion. Magna Prima concealed its beneficial interest in the property disposal by conducting the transaction through Everhall. It then evaded liability by disposing of Everhall after the benefit had been extracted. [174] GT Nelson relies heavily on the analogy to Teh Swee Neo, arguing that just as in that case Magna Prima was the “mastermind” controlling Everhall and benefiting from the transaction while not being named in the contract, so too here Magna Prima was the true party controlling and benefiting from the property disposal while remaining in the background. Magna Prima's Response [175] Magna Prima vigorously contests all aspects of GT Nelson's corporate veil lifting arguments. Magna Prima's responses may be summarised as follows. [176] First, Magna Prima submits that it is a major public listed company operating a legitimate business group comprising 17 subsidiaries in 2020. Large corporate groups typically have shared management, centralised services, and group-level approval for major subsidiary transactions. This does not constitute improper control or justify lifting the veil. It is normal corporate governance. [177] Second, the involvement of Thiruchelvam, Datuk Rahdian, and Vikram does not demonstrate improper control. In corporate groups, it is common and legitimate for parent company employees to provide services to subsidiaries, for directors to sit on multiple boards, and for legal managers to oversee group matters. The evidence from Vikram (DW1) was that Thiruchelvam acted as a “project manager for the group” handling property matters across subsidiaries. This is normal practice in corporate groups and does not amount to abuse of corporate form. [178] Third, Magna Prima submits that it did not receive any financial benefit from the property sale. The RM56 million proceeds were used by Everhall to settle its own borrowings from banks. The proceeds did not flow up to Magna Prima. Magna Prima's financial statements show zero gain from the disposal. The Bursa announcement disclosed an expected loss of RM0.4 million, not a profit. [179] Magna Prima emphasises that as a public listed company subject to Bursa Malaysia Main Listing Requirements, it is required by law to disclose all material transactions accurately. The Bursa announcement stating an expected loss of RM0.4 million was a legal disclosure made in accordance with regulatory requirements. This cannot be construed as evidence of benefit. [180] Fourth, the disposal of Everhall for RM50.00 was not undertaken to evade liabilities. It was part of a larger corporate restructuring whereby six subsidiaries (Embassy Court Sdn Bhd, Magna Prima Construction Sdn Bhd, Everhall (M) Sdn Bhd, Monetary Icon (M) Sdn Bhd, Prima Awan (M) Sdn Bhd, and MPrima (Shah Alam) Sdn Bhd) were sold to Sinaran Sensasi for a total consideration of RM50.00. [181] At the time of this disposal in May 2022, Everhall had negative net assets of approximately RM59 million. Magna Prima was disposing of a liability, not an asset. A sale at RM50.00 was not an undervalue but rather reflected the true economic position. No rational purchaser would pay more than a nominal sum for a company with negative net assets of RM59 million. [182] Magna Prima points out that the disposal was fully disclosed in its Annual Report in accordance with listing requirements. If the disposal had been undertaken with improper motive, it would not have been openly disclosed in public documents. [183] Fifth, the disposal of Everhall did not prejudice GT Nelson's legal position. Everhall continues to exist as a legal entity. It remains bound by the Judgment in Default entered against it. GT Nelson can enforce its judgment against Everhall's assets (if any) or pursue bankruptcy proceedings. The mere fact that Everhall is now owned by a different shareholder does not extinguish the judgment debt. [184] Sixth, GT Nelson's reliance on Teh Swee Neo is misplaced. The facts of that case are materially different. In Teh Swee Neo, the first defendant was found to be a nominal entity established specifically to shield the second defendant from liability for the particular transaction in dispute. By contrast, Everhall in the present case was established in 2007, long before anyone contemplated the property sale in 2020-

Everhall was not created as a vehicle for this transaction; it was an existing subsidiary with its own business operations. [185] Seventh, and fundamentally, Magna Prima submits there has been no impropriety, fraud, or abuse of corporate form. The property disposal was a legitimate commercial transaction. The corporate structure reflected genuine commercial and legal arrangements. Magna Prima, as a major public listed company, operated transparently in full compliance with regulatory requirements. This is not a case of corporate abuse warranting the exceptional remedy of lifting the veil. My Analysis and Findings on Corporate Veil Lifting [186] I have carefully considered the competing submissions and all the evidence. In my judgment, this is not an appropriate case for lifting the corporate veil. [187] I begin with the undisputed facts. Everhall and Magna Prima are separate legal entities. Magna Prima is the parent company owning all shares in Everhall. The Letter of Appointment dated 15.6.2020 was between GT Nelson and Everhall only. Magna Prima was not a party to that contract. There is no privity of contract between GT Nelson and Magna Prima. GT Nelson's claim against Magna Prima must therefore succeed or fail on the doctrine of lifting the corporate veil. [188] I must determine whether the circumstances of this case meet the high threshold established by the Federal Court in Ong Leong Chiou for lifting the veil. In particular, I must assess whether there was abuse of the corporate form amounting to concealment or evasion justifying the exceptional remedy of disregarding separate legal personality. [189] In analysing this question, I am mindful of the fundamental importance of the separate legal personality doctrine. As emphasised in Ong Leong Chiou, limited liability and separate legal personality are cornerstones of company law. They facilitate commerce, encourage investment, and provide certainty in business dealings. These principles must not be lightly cast aside. The corporate veil should only be lifted in exceptional circumstances where there is clear abuse of the corporate form. Legitimate Parent Company Involvement vs. Improper Control [190] I accept that Magna Prima, as parent company, had significant involvement in the property disposal. The evidence establishes the following matters. First, Thiruchelvam, though employed by Magna Prima Development Sdn Bhd (a sister subsidiary of Everhall within the group), handled the property disposal on behalf of Everhall. Vikram confirmed in cross-examination that Thiruchelvam functioned as “a project manager for the group” and could “work and deal on matters related to all the other subsidiary companies”. The evidence shows that Thiruchelvam signed the Letter of Appointment dated 15.6.2020 on behalf of Everhall, maintained communications with GT Nelson throughout the transaction, and coordinated the sale completion. Second, Datuk Rahdian was a director of both Everhall and Magna Prima. Vikram testified that Datuk Rahdian held the position of Group Managing Director of Magna Prima and was responsible for day-to-day operations and informing the board of Magna Prima on key matters pertaining to the group. Datuk Rahdian signed the Letter of Appointment in his capacity as director of Everhall. Third, Vikram, as legal manager of Magna Prima, provided legal services to the group including Everhall. Vikram confirmed he was involved in preparation of the Letter of Appointment and attended the meeting in December 2020 where the property sale was discussed. Fourth, Magna Prima's board of directors approved the property disposal pursuant to the governance requirements applicable to major subsidiary transactions. Fifth, the disposal was disclosed in Magna Prima's financial statements and in Bursa Malaysia announcements dated 19.4.2021 and subsequently in the Annual Report 2022. [191] However, all of these features are entirely normal and legitimate in a corporate group structure. Large corporate groups routinely have arrangements of the kind evidenced in this case. These include: a) shared management and personnel providing services across multiple group entities pursuant to management services arrangements or practical efficiency considerations; b) common directors sitting on multiple subsidiary boards to ensure alignment of strategic objectives and oversight of group interests; c) centralised legal, finance, and administrative functions serving the entire group rather than each subsidiary maintaining duplicative departments; d) parent company approval requirements for major subsidiary transactions, particularly where such transactions involve disposal of substantial assets or exceed specified financial thresholds; and e) consolidated financial reporting in accordance with accounting standards which require parent companies to report on group financial position and performance. [192] These arrangements serve entirely legitimate purposes and are indeed essential features of how modern corporate groups operate. They promote operational efficiency through shared services and expertise, avoiding wasteful duplication of resources. They enable the parent company to exercise appropriate oversight and coordinate activities across the group, ensuring coherent business strategy and risk management. They ensure proper corporate governance by maintaining board-level visibility of significant transactions. They promote sound risk management by enabling parent company assessment of material transactions before commitment. They comply with applicable accounting standards, including Malaysian Financial Reporting Standards, which mandate consolidated financial statements for holding companies. The existence of such structures reflects commercial reality and sound business practice. [193] The existence of such arrangements does not constitute abuse of corporate form. GT Nelson's argument, if accepted, would lead to an untenable result. If the features identified in paragraph 191 above justified lifting the veil, then the corporate veil could be lifted in virtually every parent-subsidiary situation. Common directors, shared services, centralised functions, and parent company approval for major transactions are standard features of corporate groups. If these normal governance arrangements constituted grounds for disregarding separate legal personality, then the distinction between parent and subsidiary companies would effectively be abolished. Every subsidiary's debts would automatically become parent company liabilities. This cannot be and is not the law. The Federal Court in Ong Leong Chiou emphasised that the corporate veil may only be lifted in exceptional circumstances involving abuse of the corporate form. Normal parent company oversight, even extensive oversight, is not such abuse. [194] GT Nelson has not demonstrated that Magna Prima's involvement went beyond normal parent company oversight and control. The evidence does not show that Everhall was a sham or façade. The critical facts establish Everhall's substance as a genuine legal entity. Everhall was incorporated on 24.8.2007, some thirteen years before this property transaction. Everhall held substantial assets, namely the Property itself valued at RM56 million. Everhall entered into the Sale and Purchase Agreement dated 3.5.2021 in its own name and capacity as the registered owner and vendor of the Property. Everhall was the contracting party in all relevant documents. The evidence from Vikram was that “The 2nd Defendant does not control, take part or interfere with the business and administration of the 1st Defendant. Similarly, the 1st Defendant does not involve in our business and administration. Both companies function and operate independently.” At the material time in 2020, Magna Prima operated a substantial business group comprising 17 subsidiary companies, of which Everhall was but one. These facts taken together demonstrate that Everhall had real substance and independent existence as a legal entity, not merely nominal status. Everhall was not created as a vehicle for this particular transaction but was an established subsidiary company within the Magna Prima group structure. [195] The involvement of Thiruchelvam requires particular consideration given the emphasis placed upon it in GT Nelson's submissions. Nelson emphasises that Thiruchelvam, though not an employee or director of Everhall, handled all aspects of the appointment and property disposal on behalf of Everhall. GT Nelson characterises this as evidence that Magna Prima, through its group personnel, was the true party to the transaction notwithstanding that it was not named in the Letter of Appointment. GT Nelson submits that Thiruchelvam's role demonstrates that the corporate structure was being used to conceal Magna Prima's beneficial interest in the property disposal. [196] I do not accept this characterisation. The evidence from both Thiruchelvam and Vikram establishes the true nature of Thiruchelvam's role and authority. When cross-examined by Nelson's counsel, Vikram confirmed that Thiruchelvam held the position of project manager with responsibility extending across the group, not merely for his employing company. The relevant exchange was as follows. When asked “Do you know what is his actual job scope?”, Vikram answered: “He's a project manager.” When asked “Project manager for which company? Or does you function like you for the group?”, Vikram answered: “For the group.” When asked “Project manager only for Magna Prima Development or is a project manager for the group?”, Vikram confirmed: “For the group.” When asked “So, which means he can actually work and deal on matters related to all the other subsidiary companies. Am I right?”, Vikram agreed: “Yes.” This evidence establishes that Thiruchelvam's role was to handle property matters across various subsidiaries within the Magna Prima group, not solely for any single company. The source of his authority was addressed in further cross-examination. When the asked: “Now what will be the source of power for him to do so?”, Vikram explained: “Get the power from the each company.” Vikram further testified that monthly submissions were made to Magna Prima's finance department documenting the allocation of time and work performed by group personnel across different subsidiaries to enable proper cost allocation. [197] In corporate groups, it is commonplace and entirely legitimate for parent company personnel or personnel from one subsidiary to provide services to other subsidiaries within the group. This arrangement may operate pursuant to formal management services agreements or simply as a matter of practical efficiency in utilising available expertise and resources. The evidence from Vikram was that such arrangements existed within the Magna Prima group for various functions including legal services and property management. Such arrangements do not make the parent company or the employing subsidiary liable for contracts entered into by the subsidiary being served. The arrangement merely reflects the commercial reality that corporate groups achieve efficiencies by sharing personnel and expertise rather than each subsidiary employing its own complete complement of specialists in every field. The law has long recognised and accepted such arrangements as legitimate features of corporate group structures. [198] The critical point, which must be clearly understood, is that Thiruchelvam, when dealing with the property disposal transaction, was acting on behalf of and as agent for Everhall, not on behalf of himself personally or Magna Prima or Magna Prima Development Sdn Bhd. This is established by the documentary evidence and the testimony. Thiruchelvam signed the Letter of Appointment dated 15.6.2020 on behalf of Everhall. The Letter of Appointment was issued by Everhall to GT Nelson. Throughout the negotiations with Nelson's representative Andy Lim, Thiruchelvam dealt with the matter as Everhall's representative. When the Sale and Purchase Agreement was executed on 3.5.2021, Everhall was the named party as vendor. All relevant documents identified Everhall, not Magna Prima or any other entity, as the principal in the transaction. The fact that Thiruchelvam was employed by a sister subsidiary rather than by Everhall directly does not alter this fundamental reality. He was acting for Everhall within the scope of authority conferred upon him. Everhall is bound by his acts as agent. GT Nelson dealt with him knowing he represented Everhall in the transaction. [199] I accept that the fact that an agent or representative of a company is employed by the parent company, or is also a director or officer of the parent company, or serves multiple entities within a corporate group, does not make the parent company liable for the subsidiary's contracts. The agent acts for and binds the subsidiary within the scope of his authority. The subsidiary, as principal, is bound by the agent's acts performed within that authority. This is elementary agency law. It is entirely consistent with maintaining the distinction between parent and subsidiary as separate legal persons. If the law were otherwise, then every contract negotiated by group personnel on behalf of a subsidiary would bind the parent company regardless of which entity was named as the contracting party. This would render meaningless the principle of separate legal personality in the context of corporate groups. The authorities do not support such a proposition, and sound commercial policy militates firmly against it. Magna Prima's submission on this point is correct. The involvement of Thiruchelvam, properly analysed, does not constitute grounds for lifting the corporate veil or imposing liability upon Magna Prima for Everhall's contractual obligations. Did Magna Prima Receive a Benefit? [200] GT Nelson submits that Magna Prima received the benefit of the RM56 million proceeds from the property sale. This is a central plank of GT Nelson's case on lifting the veil. GT Nelson's Statement of Claim at paragraph 20 pleads: “Pada setiap masa yang material, Defendan Kedua telah menerima manfaat secara keseluruhannya daripada penjualan Hartanah tersebut oleh Defendan Pertama” (At every material time, Magna Prima received the overall benefit from the sale of the Property by Everhall). [201] I have examined the evidence carefully on this issue. The factual position is as follows: a) The Property was owned by Everhall. It was sold by Everhall to the purchaser, Cowboy (KL) Sdn Bhd, for RM56 million pursuant to the Sale and Purchase Agreement dated 3.5.2021. b) The sale proceeds of RM56 million were received by Everhall as vendor under the Sale and Purchase Agreement. Everhall, as the registered proprietor and contracting party, was the entity entitled to receive and did receive the purchase monies. c) These proceeds were used by Everhall to settle its borrowings from banks. The evidence from Vikram in his witness statement states: “I also wish to add that based on the information I have the purchase price was substantially used to settle the loan taken by the 1st Defendant from Malaysia Building Society Berhad.” The Annual Report disclosures in Note 16 at page 136 of Bundle B1 show that Everhall, had substantial bank borrowings in default, stating, “During the financial year, EHSB received multiple notices of demand from a licensed bank on an event of default in term loan repayment.” The property sale proceeds were applied to settle these borrowings. d) Magna Prima's financial statements show zero gain from the disposal. At page 393 of Bundle B1, Note 31 on Segmental Reporting shows the 2022 financial results. Under the “Results” section for the Properties segment, the line item “Gain on disposal of non-current assets held for sale” shows no figure, indicating zero gain from the property disposal. This is consistent with the consolidated financial position where the proceeds were used for debt settlement rather than generating profit for the group.

The Bursa Malaysia announcement dated 19.4.2021 states at paragraph 6.2 under “Financial Implication” that “The expected loss on the Disposal to the Group is approximately RM0.4 million.” This announcement further confirms at paragraph 6.3 that “The proceeds arising from the Disposal are satisfied by way of cash which shall be utilized to pay off it's borrowing.” [202] On this evidence, I cannot find that Magna Prima received a direct financial benefit from the property sale. The proceeds were received by Everhall and went to settle Everhall's own debts to its creditors, namely the banking institutions. The purchase monies did not flow upwards to Magna Prima. Magna Prima, at most, benefited indirectly from having a troubled subsidiary pay down its debts and reduce its default position with lenders, but this is materially different from Magna Prima receiving or appropriating the sale proceeds for its own use. [203] GT Nelson argues that even if there was no direct financial benefit, Magna Prima benefited from improved market perception and removal of the going concern issues affecting Everhall. GT Nelson points to the Going Concern note at page 107 of Bundle B1, Note 2.1, which states: “These factors indicate the existence of material uncertainties that may cast significant doubt on the Group's and the Company's ability to continue as going concerns.” GT Nelson submits that Everhall's financial difficulties had impacted Magna Prima's consolidated accounts, and that by disposing of the Property at RM56 million, even though showing zero accounting gain, the transaction helped improve Magna Prima's financial position and market perception as a public listed company. [204] During oral clarifications on 10.10.2025, GT Nelson's counsel expanded on this argument: “The benefit does not need to be a monetary receipt for the Second Defendant. If we refer to whatever is published in the financial statements, which is at page 107 of B1, it says that at the subsidiary's company has an impact on D2 and the group. It says these factors indicate the existence of material uncertainties that may cast significant doubt on the group's and the company's ability to continue as going concerns. So, the financial situation of D1 has actually impacted on the Second Defendant’s accounts. So, when they actually sold off the land owned by D1, there is actually an impact on the accounts of D2. D2 is actually a public company so whatever that is published on Bursa and their accounts has actually an impact on that. By selling off the property at RM56 million, even though on record there is no gain, there is zero gain that has been shown by my learned friend, but then, it actually helps out the accounts of D2. … Actually, when they actually publish something on Bursa, (it actually affects the public view on the company, whether the company is healthy or not. So, when the company actually has a lot of value, it actually has an impact.” [205] I find that this argument based on indirect or non-monetary benefits is too remote and speculative to constitute “benefit” sufficient to justify lifting the corporate veil. The Going Concern note at page 107 is a general disclosure regarding the Group's financial position. It does not specifically link the property disposal to any measurable improvement in Magna Prima's financial status. Every parent company benefits indirectly when its subsidiaries reduce their debts, improve their financial position, and address default situations with creditors. This is the natural consequence of consolidated group accounting and does not, without more, justify disregarding separate legal personality. If such indirect benefits were sufficient to lift the corporate veil, the doctrine of separate legal personality would be undermined in virtually every parent-subsidiary relationship where a subsidiary disposes of assets to settle debts. [206] I note that Magna Prima is a public listed company subject to Bursa Malaysia Main Listing Requirements. These requirements impose strict obligations regarding accurate disclosure of material information. The Bursa announcement stating an expected loss of RM0.4 million was a formal disclosure made in compliance with regulatory obligations. As Magna Prima's counsel submitted during oral clarifications: “I think the Bursa announcement speaks for itself. Because this public listed company is governed by the regulations, failure of disclosure in the announcement would be a criminal offence. The announcement is accurate.” Given that it would be a criminal offence for Magna Prima to make false or misleading disclosures to Bursa Malaysia, I must proceed on the presumption that this disclosure was accurate unless proven otherwise. [207] GT Nelson attempted to challenge this disclosure by referring to the going concern notes in the financial statements and by suggesting that non-monetary benefits were received. However, GT Nelson did not call any expert evidence to establish that the financial statements or Bursa disclosures were incorrect, misleading, or should be interpreted differently. The interpretation of complex financial documents, accounting treatments, and the effect of transactions on consolidated group accounts are matters requiring expert testimony. Without such expert evidence, I cannot prefer GT Nelson's counsel's interpretation of financial documents over the audited financial statements and regulatory disclosures of a public listed company. [208] During oral clarifications on 10.10.2025, the court specifically questioned GT Nelson's counsel about the difficulty of interpreting financial documents without expert evidence. I noted my disadvantage as a non-expert and observed that counsel was asking the court to rely on their interpretation of the documents, to which counsel could only respond by stating that GT Nelson was relying on the financial statements as Part A documents. This exchange makes clear that counsel acknowledged the limitation of proceeding without expert evidence on financial matters. [209] In the absence of expert evidence, I must proceed on the basis that Magna Prima's financial statements and Bursa disclosures accurately reflect the financial position. The financial statements are audited documents. The Bursa announcement was made pursuant to mandatory regulatory requirements. Both carry significant weight and cannot be displaced by mere submission of counsel without expert testimony. Accordingly, I find that GT Nelson has not established that Magna Prima received a benefit from the property sale, whether direct or indirect, sufficient to justify lifting the corporate veil. The evidence shows that Everhall received the proceeds, used them to settle its own bank borrowings, and that Magna Prima recorded zero gain and an expected loss from the transaction. This is fatal to GT Nelson's case on the benefit limb of the concealment and evasion principles. The Disposal of Everhall for RM50 [210] The most significant aspect of GT Nelson's case is the disposal of Everhall for RM50.00 to Sinaran Sensasi on 5.5.2022. GT Nelson contends that this disposal was undertaken with the deliberate intention to evade the commission liability. In its pleadings, GT Nelson alleges that: “pada setiap masa yang material, walaupun Defendan Pertama dan Defendan Kedua mempunyai pengetahuan penuh berkenaan tanggungjawabnya untuk membayar terhadap tuntutan Plaintif, Defendan Pertama mahupun Defendan Kedua telah menyembunyikan fakta bahawa terdapatnya liabiliti yang wujud berdasarkan penjualan Hartanah tersebut sebelum pelupusan kepentingan Defendan Kedua dalam syarikat Defendan Pertama dan perbuatan dan/atau tindakan tersebut adalah dengan niat jahat dan mala fide untuk mengelakkan liabiliti” (Para 24 of the Statement of Claim). GT Nelson characterises this as “deliberate concealment of facts” and “evasion of liability”. [211] The timing of the disposal is certainly a relevant consideration. The Property was sold on 3.5.2021. The property sale was completed with transfer of title on 16.2.2022. GT Nelson issued its first invoice for commission on 18.10.2021 (although this invoice was not acted upon at the time). Subsequently, GT Nelson issued notices of demand dated 13.12.2022 and 9.1.2023 claiming the commission sum of RM1,680,000.00. The Writ of Summons was filed on 4.10.2023. Judgment in default was obtained on 30.12.2023. The Share Sale Agreement disposing of Everhall's shares occurred on 5.5.2022, which was after the completion of the property sale in February 2022 but before GT Nelson issued its formal demands in December 2022. At the time of the disposal in May 2022, there was no litigation, no formal demand, and no assertion of any claim by GT Nelson against either Defendant. [212] However, I must examine this transaction carefully and in its full context. The critical facts are as follows: a) The disposal on 5.5.2022 was not confined to Everhall alone. The Share Sale Agreement involved the disposal of six subsidiaries: Embassy Court Sdn Bhd, Magna Prima Construction Sdn Bhd, Everhall

(M) Sdn Bhd (Everhall), Monetary Icon (M) Sdn Bhd, Prima Awan (M) Sdn Bhd, and MPrima (Shah Alam) Sdn Bhd. All six companies were sold to Sinaran Sensasi for a total consideration of RM50.00. b) At the time of disposal, Everhall had negative net assets of approximately RM59 million. Magna Prima's Annual Report for the financial year ended 31.10.2020 disclosed multiple notices of demand from a licensed bank regarding events of default in term loan repayments by Everhall. The Going Concern note in the financial statements stated: “These factors indicate the existence of material uncertainties that may cast significant doubt on the Group's and the Company's ability to continue as going concerns.” Everhall was plainly in serious financial distress. c) The disposal was fully disclosed in Magna Prima's Annual Report for 2022 as part of a corporate restructuring exercise. The Annual Report stated: “On 5 May 2022, Magna Prima Berhad entered into a share sale agreement with a third party to dispose its entire equity interests in DISPOSAL Group for a cash consideration of RM50.” d) The disposal was announced to Bursa Malaysia on 14.2.2022 in accordance with the Main Listing Requirements. The Bursa announcement disclosed the expected loss of RM0.4 million on disposal. [213] Viewing this transaction in its full commercial and temporal context, I cannot characterise it as a deliberate attempt to evade the commission liability. Several factors support this conclusion. [214] First, the disposal was part of a comprehensive corporate restructuring involving six subsidiaries, not an isolated or targeted disposal of Everhall alone. If Magna Prima's specific intention had been to evade the commission liability owed by Everhall, one would expect a targeted disposal of just Everhall to remove it from the corporate group. Instead, Everhall was disposed of together with five other subsidiaries in a single transaction for a combined nominal consideration. This pattern is more consistent with a genuine corporate restructuring than with an evasion scheme targeting a specific liability. [215] The commercial rationale for the restructuring is evident from the evidence. Vikram, testified in his witness statement that: “We sold all our shares at 1st Defendant to Sinaran due to our corporate exercise. At the same corporate exercise, we also sold all our shares at Monetary ICO (M) Sdn Bhd, Magna Prima Construction Sdn Bhd and Embassy Court Sdn Bhd to Sinaran. This corporate exercise was our strategy move to streamline our focus on our core business and potentially fuel future expansion. With this corporate exercise we shifted our focus towards our core property development activities.” He further explained: “These companies Monetary ICO (M) Sdn Bhd, Magna Prima Construction Sdn Bhd and Embassy Court Sdn Bhd were dormant at the material time. They became dormant as not active involvement in any on going project, their respective developments were completed, individual units sold to purchasers, strata titles were issued. For us to maintain all these companies, will incur more costs for us. Same thing, after the disposal of the property at Everhall, there is no on going project and Everhall does not hold any other property. Therefore, the Group sold the shares of Everhall to Sinaran.” At the material time, Magna Prima had 17 subsidiary companies engaged in various business activities. The disposal of non-core or dormant subsidiaries with no ongoing projects is a routine corporate exercise undertaken by large groups to rationalise their corporate structure and reduce administrative costs. [216] Second, the consideration of RM50.00 for all six companies combined reflects the harsh economic reality that these were distressed companies with substantial negative net worth. Everhall alone had negative net assets of approximately RM59 million and was in default on its bank borrowings. No rational commercial purchaser would pay substantial consideration for a company with negative net assets of such magnitude. In these circumstances, the nominal consideration of RM50.00 was not a disposal at an undervalue designed to strip assets; rather, it accurately reflected the true economic position of the companies. The purchaser, Sinaran Sensasi, was acquiring companies with no assets but with substantial liabilities. The nominal price reflected this commercial reality. [217] Third, the disposal was conducted with complete transparency. It was formally documented in a Share Sale Agreement dated 5.5.2022. It was disclosed in Magna Prima's Annual Report published on Bursa Malaysia and on Magna Prima's website. It was announced to Bursa Malaysia in compliance with the Main Listing Requirements applicable to public listed companies. As Magna Prima correctly submits, if the disposal had been undertaken with improper motive to conceal assets or evade liabilities, one would not expect such transparency and full public disclosure. Magna Prima, as a public listed company, is subject to stringent regulatory oversight. Making false or misleading disclosures to Bursa Malaysia would constitute a criminal offence. I must presume that these regulatory disclosures were accurate and made in good faith. [218] Fourth, and most critically from a legal standpoint, the disposal did not extinguish Everhall's liability or prejudice GT Nelson's ability to enforce its rights. Everhall continues to exist as a separate legal entity. Everhall's legal personality and its legal obligations remain intact notwithstanding the change in share ownership. A change of shareholders does not extinguish a company's debts. The Judgment in Default entered by GT Nelson against Everhall on 30.12.2023 remains valid and fully enforceable. GT Nelson can pursue enforcement proceedings against Everhall, including winding-up proceedings if appropriate, regardless of who owns Everhall's shares. The disposal changed the ownership of Everhall; it did not dissolve the company or extinguish its liabilities. [219] GT Nelson will undoubtedly face practical difficulties in recovering the judgment sum from a company with negative net assets of RM59 million. However, this practical difficulty is not a consequence of the corporate structure employed by Magna Prima, nor is it a consequence of the disposal of shares in May 2022. Rather, it is a direct consequence of Everhall's insolvency. GT Nelson contracted with and accepted an appointment from Everhall. GT Nelson did not inquire into Everhall's financial position before accepting the appointment. GT Nelson did not seek any guarantee from Magna Prima or any other party. GT Nelson did not negotiate any contractual protections to ensure payment in the event of Everhall's insolvency. That was GT Nelson's commercial decision, made in the ordinary course of business dealings. GT Nelson must now bear the consequences of having contracted with an insolvent company. This is the essence of commercial risk in business transactions. [220] Companies become insolvent. Creditors of insolvent companies frequently recover nothing, or only a small percentage of their debts through liquidation or other insolvency proceedings. This is an accepted consequence of the principle of limited liability and the operation of insolvency law. It is emphatically not a basis for lifting the corporate veil to impose liability on a parent company. If the corporate veil could be lifted merely because a subsidiary became insolvent and unable to pay its debts, then the principle of limited liability would be rendered illusory for all parent companies. The entire edifice of limited liability, which serves vital economic purposes and facilitates commerce, would collapse. As Nallini Pathmanathan FCJ observed in the Federal Court decision in Ong Leong Chiou at 99: “It is the essence of incorporation that the shareholder/controller of the company limits his liability in respect of the future conduct of the company's affairs. There is nothing wrong with that. Advantage is taken of limited liability to avoid personal liability if things go wrong.” However, as her Ladyship continued: “the limitation of liability envisages that such future conduct of the company's business is to be conducted honestly and with integrity – the law is predicated on that assumption.” In the present case, there is no evidence of dishonesty, lack of integrity, or abuse of the corporate form. The disposal was a legitimate corporate restructuring conducted transparently and in accordance with all regulatory requirements. These circumstances simply do not warrant the exceptional remedy of lifting the corporate veil. Concealment or Evasion? [221] Applying the framework established by the Federal Court in Ong Leong Chiou, I must determine whether the concealment principle or the evasion principle applies in this case. As the Federal Court explained at paragraph 46, drawing upon the judgment of Lord Sumption in Prest v Petrodel Resources Limited [2013] UKSC 34, these are two distinct principles that lie behind the terms 'façade' and 'sham', and much confusion has been caused by failing to distinguish between them. The concealment principle “does not entail the piercing of the corporate veil” but rather allows the court to look behind the corporate structure to discover the facts which the corporate structure is concealing. The evasion principle, by contrast, permits the court to disregard the corporate veil “if there is a legal right against the person in control of it which exists independently of the company's involvement, and a company is interposed so that the separate legal personality of the company will defeat the right or frustrate its enforcement.” [222] On the concealment principle, the fundamental question is whether the corporate structure was used to conceal the true facts or the identity of the true controller. Having examined the evidence comprehensively, I find that there was no material concealment in this case. The corporate structure was entirely transparent. Everhall was openly and publicly identified as a wholly-owned subsidiary of Magna Prima. This parent-subsidiary relationship was disclosed in public documents, including Magna Prima's annual reports and Bursa Malaysia announcements. Everhall was incorporated in 2007 and had been operating as a subsidiary within the Magna Prima group for 13 years before the Property disposal transaction. The evidence from Vikram confirmed that Magna Prima had 17 subsidiary companies as of 2020, and that Everhall was one of these subsidiaries functioning within an established corporate group structure. Magna Prima's involvement in approving the property disposal through board resolutions and the participation of common directors was normal parent company oversight consistent with proper corporate governance, not concealment of control or manipulation of corporate form. [223] GT Nelson submits that Magna Prima concealed its involvement by not being named as a party in the Letter of Appointment dated 15.6.2020, and by conducting the transaction through Everhall whilst remaining in the background. I reject this submission. The fact that Magna Prima was not named in the Letter of Appointment is not evidence of concealment. It is simply a reflection of the legal reality that Everhall, as the registered proprietor of the Property, was the appropriate and natural contracting party. GT Nelson knew from the outset that Everhall was part of the Magna Prima group. This is evident from GT Nelson's own dealings with Thiruchelvam, whose business card identified him as Director of Property Development & Special Projects at Magna Prima Development Sdn Bhd, a subsidiary of Magna Prima. Andy Lim testified that he contacted the number on the bunting advertising the Property and was connected to Thiruchelvam. At the December 2020 meeting, representatives from Magna Prima including Datuk Rahdian (a director of both companies) and Vikram (Magna Prima's legal manager) were present. There was no deception or concealment of the corporate structure or relationships. GT Nelson was fully aware it was dealing with a property owned by a subsidiary within the Magna Prima corporate group. [224] Turning to the evasion principle, the test articulated by the Federal Court in Ong Leong Chiou at paragraph 99(iv) is whether “there is a legal right against the person in control of a company which exists independently of the company's involvement, and a company is interposed such that the legal personality of the company defeats the legal right or frustrates its enforcement.” As Lord Sumption stated in Prest and quoted with approval by the Federal Court in para 49, “there is a limited principle of English law which applies when a person is under an existing legal obligation or liability or subject to an existing legal restriction which he deliberately evades or whose enforcement he deliberately frustrates by interposing a company under his control. The court is then entitled to pierce the corporate veil for the purpose of depriving the company or its controller of the advantage they would otherwise have obtained by the company's separate legal personality.” The Federal Court emphasised at paragraph 99(iv) that this is “a considerable obstacle to overcome, and it is only rarely that an appropriate set of facts will allow for such 'piercing'. Ultimately, the narrow and rigid test ensures that the corporate personality is not lightly disregarded.” [225] In the present case, I find that Everhall was not “interposed” to evade any existing legal obligation. The concept of interposition requires that a company be created or inserted into a transaction for the specific purpose of defeating or frustrating an existing right. The evidence establishes that Everhall already existed as an independent legal entity and had owned the Property since well before GT Nelson was appointed. Everhall was incorporated on 24.8.2007 and became the registered proprietor of the Property. This was some 13 years before the Letter of Appointment was executed on 15.6.2020. Everhall was thus the natural and appropriate contracting party as the legal owner of the Property. The appointment of GT Nelson was a genuine arm's length commercial transaction. There is no evidence whatsoever that the corporate structure was manipulated, or that Everhall was created or interposed for the purpose of evading any liability to GT Nelson. This case bears no resemblance to situations such as Gilford Motor Company Ltd v Horne [1933] Ch 935, cited in Ong Leong Chiou as a correct application of the evasion principle, where a company was deliberately created to circumvent an existing legal restriction. [226] GT Nelson places considerable weight on the disposal of Everhall's shares to Sinaran Sensasi on 5.5.2022 for the nominal consideration of RM50.00 (as part of a package deal involving six subsidiaries), arguing that this demonstrates evasion. Whilst the timing and circumstances of this disposal are relevant considerations, I find that it does not constitute evasion within the meaning established in Ong Leong Chiou. Several factors are determinative. First, as Magna Prima submits, this was not an isolated disposal of Everhall alone but part of a broader corporate restructuring exercise involving six companies: Embassy Court Sdn Bhd, Magna Prima Construction Sdn Bhd, Everhall (M) Sdn Bhd, Monetary Icon (M) Sdn Bhd, Prima Awan (M) Sdn Bhd, and MPrima (Shah Alam) Sdn Bhd, all disposed of together for a total consideration of RM50.00. According to Vikram’s evidence, this corporate exercise was undertaken to streamline the group's focus on core property development activities, as these companies were dormant with no ongoing projects. Second, and critically, at the time of disposal on 5.5.2022, GT Nelson had not yet formally asserted its claim. The invoices for commission were only issued on 13.12.2022 and 9.1.2023, some seven to eight months after the share disposal. For the evasion principle to apply, there must be an existing legal right or established liability that the company is being used to defeat or frustrate. At the relevant time in May 2022, there was no Writ of Summons, no judgment, no formal demand, and no established liability. The Writ was only filed on 18.10.2023, and the Judgment in Default was only obtained on 30.12.2023. Third, the disposal did not extinguish Everhall's liability or prejudice GT Nelson's ability to enforce its contractual rights. Everhall continued to exist as a legal entity, and the Judgment in Default obtained by GT Nelson against Everhall remains valid and enforceable regardless of the change in share ownership. [227] GT Nelson's real difficulty is that Everhall had negative net assets of approximately RM59 million at the material time, as disclosed in Magna Prima's financial statements. The nominal consideration of RM50.00 reflected this economic reality. Everhall was a distressed entity with substantial liabilities exceeding its assets. The practical difficulty of recovering the judgment sum from an insolvent company is a consequence of Everhall's financial position, not a consequence of any improper manipulation of corporate structure or deliberate evasion. GT Nelson contracted with Everhall without making inquiries into its financial position or seeking any guarantees from the parent company. That was a commercial risk that GT Nelson assumed. These facts simply do not satisfy the narrow and rigid test for evasion established in Ong Leong Chiou, which requires proof that a company was interposed to defeat an existing legal right or frustrate its enforcement. The disposal was fully disclosed in Magna Prima's Annual Report and announced to Bursa Malaysia in accordance with listing requirements, demonstrating transparency rather than concealment or evasion. Distinguishing Teh Swee Neo [228] GT Nelson relies heavily on Teh Swee Neo & Anor v CCRM Management Sdn Bhd & Anor [supra] as an analogous case supporting the application of corporate veil lifting principles. GT Nelson submits that, as in Teh Swee Neo, Magna Prima was the “mastermind” behind the transaction, the Letter of Appointment failed to name the true controlling party, and the corporate structure was used to conceal liability and evade obligations through the subsequent disposal of Everhall. However, I find that Teh Swee Neo is distinguishable on its material facts. [229] In Teh Swee Neo, decided by the High Court, the court found that the first defendant company (CCRM Management Sdn Bhd, formerly Capital City Retail Management Sdn Bhd) was incorporated as a nominal entity by the second defendant (Capital City Property Sdn Bhd) specifically to shield the second defendant from contractual liability under a tenancy agreement. The critical findings were that: a) the second defendant was incorporated on 14.6.2013, approximately six months before the Capital City project launch on 28.12.2013, whilst the first defendant was incorporated a mere two days before the project launch with a paid-up capital of only RM100.00; b) the first defendant was created “just for the purpose of making it as D2's vehicle for the purpose of the TA”; c) the first defendant shared all material characteristics with the second defendant including common director (Siow Chien Fu), same registered office, same business office, and same company secretaries; and d) all marketing materials, sale documentation, and public announcements made no reference to the first defendant but only to the second defendant and the Capital City project. The High Court concluded at paragraph [97] that “D1 in this case is a nominal company which was incorporated by a common director (SD2) to absorb the contractual liabilities incurred under the TA while D2 was incorporated by the same SD2 to develop the project.” [230] The first defendant was held to be a façade or sham entity lacking genuine independent operations, and the second defendant was found to be the true party to the transaction notwithstanding it was not named in the contract. [231] By contrast, the present case involves fundamentally different corporate arrangements and temporal circumstances. First, and most significantly, Everhall was incorporated on 24.8.2007 bearing company registration number 200701028031 / 786053-V, more than thirteen years before the Letter of Appointment was executed on 15.6.2020 and the property sale transaction contemplated in 2020-2021. Everhall was not created as a vehicle for this particular transaction. It was an existing subsidiary company with a long history within the Magna Prima corporate group structure. This temporal factor distinguishes Teh Swee Neo where Everhall was incorporated merely two days before the specific project launch, demonstrating a clear nexus between incorporation and the transaction giving rise to liability. [232] Second, unlike the minimal RM100.00 shell company in Teh Swee Neo, Everhall possessed substantial commercial reality. The evidence establishes that Everhall was the registered proprietor of significant real property, namely the Supermarket & Commercial Complex of Pusat Komersial Jalan Kuching, Kuala Lumpur, which was valued at RM56,000,000.00. Everhall owned this substantial asset and entered into the Sale and Purchase Agreement dated 3.5.2021 with Cowboy (KL) Sdn Bhd in its own name and in its capacity as the legal and beneficial owner of the Property. This demonstrates that Everhall was not a nominal entity or mere shell company. It had real substance, conducted genuine transactions, and functioned as a legitimate subsidiary within a corporate group comprising 17 subsidiary companies as at 2020. Everhall's role as registered proprietor and vendor of the Property was entirely consistent with normal subsidiary company operations within a property development group structure. [233] Third, there is no evidence that Everhall was established as a façade, sham, or device to evade contractual obligations. Everhall was already in existence for over a decade before GT Nelson's appointment. GT Nelson entered into the Letter of Appointment with full knowledge of the corporate arrangements. Thiruchelvam, who liaised with GT Nelson's representative Andy Lim, openly identified himself as employed by Magna Prima Development Sdn Bhd (a subsidiary of Magna Prima) and his business card reflected this employment. There was transparency about the group structure. GT Nelson was aware from the outset that it was dealing with entities within the Magna Prima group. Unlike Teh Swee Neo where all marketing materials concealed Everhall's existence and made no reference to it, in the present case there was no concealment of Everhall's identity or role. Everhall, as registered owner of the Property being marketed for sale, was the natural and appropriate contracting party for the Letter of Appointment. These material differences mean that Teh Swee Neo does not assist GT Nelson. That case involved a shell company created specifically to absorb liabilities for a particular project, incorporated at the inception of that very project. The present case involves a long-established subsidiary company with substantial assets transacting in the ordinary course of its business within a legitimate corporate group structure. Conclusion [234] For all these reasons, I conclude that this is not an appropriate case for lifting the corporate veil. The circumstances do not meet the high threshold established by the Federal Court in Ong Leong Chiou. The separate legal personality of Everhall and Magna Prima must be respected. The principles of separate legal personality and limited liability are fundamental to company law. They must be maintained to facilitate commerce, encourage investment, and provide certainty in business dealings. These principles must be maintained except in clear cases of abuse. The present case, despite involving a parent company's oversight of its subsidiary's affairs, does not constitute such abuse. The Underlying Merit of the Commission Claim [235] Before concluding, I wish to address an important point. My decision to dismiss GT Nelson's claim against Magna Prima is not a finding that GT Nelson's underlying commission claim lacks merit. On the contrary, having examined all the evidence, I am satisfied that GT Nelson has a valid and meritorious claim for commission arising from the Letter of Appointment dated 15.6.2020. [236] I find that: a) The Letter of Appointment was validly formed and created binding contractual obligations; b) GT Nelson performed its obligations under the Letter of Appointment by successfully marketing the Property and procuring a purchaser; c) GT Nelson was the effective cause of the sale to Cowboy (KL) Sdn Bhd at RM56,000,000.00; d) GT Nelson is entitled to commission calculated at 3% of the selling price, amounting to RM1,680,000.00; e) Everhall is liable to pay this commission to GT Nelson. [237] These findings are not inconsistent with the Judgment in Default obtained by GT Nelson against Everhall on 30.12.2023. That judgment stands valid and enforceable. Everhall remains liable for the commission debt. [238] My decision concerns only the question of whether Magna Prima can be held liable for Everhall's debt. On that question, I have concluded that the corporate veil should not be lifted. But this in no way reflects adversely on the merits of GT Nelson's commission claim against Everhall. [239] GT Nelson performed valuable services. It successfully procured a purchaser for a substantial property. It facilitated a sale at RM56 million. It earned its commission through honest professional work. GT Nelson deserves to be paid. However, the party liable to pay is Everhall, being the party with whom GT Nelson contracted. Magna Prima, being a separate legal entity not party to the contract, is not liable in the absence of grounds to lift the corporate veil. DETERMINATION OF ISSUES TO BE TRIED [240] Having set out my detailed analysis, I now formally address each of the seven Issues to be Tried that were agreed by the parties. Issue No. 1 [241] Issue No. 1 is set out as follows: Whether the Letter of Appointment appointing GT Nelson as non-exclusive marketing agent for the property was signed by GT Nelson and Everhall, and whether Magna Prima as the parent company of Everhall at the material time received benefit from the sale of the property? [242] The first part is answered in the affirmative. The Letter of Appointment dated 15.6.2020 was signed by GT Nelson and Everhall. The second part is answered in the negative. I find that Magna Prima did not receive direct financial benefit from the sale of the property. The sale proceeds of RM56,000,000.00 were received by Everhall and used to settle Everhall's own borrowings. Magna Prima's financial statements show zero gain from the disposal. Issue No. 2 [243] Issue No. 2 is set out as follows: Whether, at the material time, notices of demand dated 13.12.2022 and 9.1.2023 for the commission sum of RM1,680,000.00 were delivered to Everhall and Magna Prima? [244] This is answered in the affirmative. The evidence establishes that invoices dated 13.12.2022 and 9.1.2023 for the sum of RM1,680,000.00 were sent to Everhall. I further find that at least one of these invoices was also sent to or copied to Magna Prima at its office address. Issue No. 3 [245] Issue No. 3 is set out as follows: Whether GT Nelson performed the services as agreed in the Letter of Appointment and successfully obtained a purchaser introduced by GT Nelson to purchase the property at a sale price of RM56,000,000.00? [246] This is answered in the affirmative. I find that GT Nelson performed its obligations under the Letter of Appointment by marketing the property and procuring the Cowboy group of companies as purchasers. The property was ultimately sold to Cowboy (KL) Sdn Bhd, an entity within the Cowboy group, at the price of RM56,000,000.00, and GT Nelson was the effective cause of the sale. Issue No. 4 [247] Issue No. 4 is set out as follows: Whether Everhall and Magna Prima discharged their obligation to pay GT Nelson’s commission immediately after the Sale and Purchase Agreement was signed and completed for the sum of RM1,680,000.00? [248] This is answered in the negative. Neither Defendant paid the commission. Everhall, who was contractually obliged to do so under the Letter of Appointment, failed to make payment, resulting in the Judgment in Default. Magna Prima, however, had no contractual obligation to pay the commission as it was not a party to the Letter of Appointment. Issue No. 5 [249] Issue No. 5 is set out as follows: Whether Magna Prima is jointly liable together with Everhall? [250] This is answered in the negative. Magna Prima is not jointly liable with Everhall as it was not a party to the Letter of Appointment. The circumstances of the case do not justify lifting the corporate veil, and the separate legal personality of Everhall and Magna Prima must be respected. Issue No. 6 [251] Issue No. 6 is set out as follows: Whether GT Nelson’s claim against Magna Prima is barred by the legal principle of separate legal entity? [252] This is answered in the affirmative. Everhall and Magna Prima are separate legal entities, and the Letter of Appointment was entered into by Everhall alone. There is no privity of contract between GT Nelson and Magna Prima, and the circumstances do not warrant lifting the corporate veil. Accordingly, the principle of separate legal personality bars GT Nelson’s claim against Magna Prima. Issue No. 7 [253] Issue No. 7 is set out as follows: Whether GT Nelson has fulfilled all the terms in the Letter of Appointment dated 15.6.2020? [254] This is answered in the affirmative. I find that GT Nelson substantially complied with and fulfilled the terms of the Letter of Appointment by procuring a purchaser, facilitating the sale, and bringing the transaction to completion. Although there were delays in the signing of the Sale and Purchase Agreement, these delays were not attributable to GT Nelson but arose from factors beyond its control, including the Defendants’ internal approval processes and the COVID-19 pandemic. The appointment was effectively extended by the conduct of the parties, who continued to treat it as subsisting beyond the stipulated three-month period. CONCLUSION AND ORDER [255] This case has required me to examine fundamental principles of contract law, company law, and the doctrine of lifting the corporate veil. It has involved detailed analysis of the corporate structure, the business dealings between the parties, and the application of the principles established by the Federal Court in Ong Leong Chiou. [256] My conclusions may be summarised as follows. GT Nelson has a valid commission claim against Everhall. GT Nelson performed valuable services and earned its commission. Everhall is liable to pay the commission of RM1,680,000.00. The Judgment in Default obtained by GT Nelson against Everhall stands valid and enforceable. [257] However, Magna Prima is not liable for Everhall's debt. Magna Prima was not a party to the Letter of Appointment. There is no privity of contract between GT Nelson and Magna Prima. The circumstances do not justify the exceptional remedy of lifting the corporate veil. Everhall and Magna Prima are separate legal entities, and that separation must be respected. [258] Magna Prima's involvement in the transaction was consistent with normal parent company oversight in a corporate group. Magna Prima did not receive the benefit of the sale proceeds. The disposal of Everhall for RM50.00 was part of a broader corporate restructuring and did not amount to evasion of liability. There has been no abuse of the corporate form that would warrant disregarding the principle of separate legal personality. [259] I recognise that this decision may leave GT Nelson facing practical difficulties in recovering its judgment against Everhall, which has negative net assets. This is unfortunate for GT Nelson, which performed its services in good faith and is entitled to be paid. However, this is the commercial reality of limited liability. Creditors who contract with subsidiaries assume the risk of the subsidiary's insolvency. The law does not permit lifting the corporate veil merely because a subsidiary is unable to pay its debts. [260] If creditors wish to have recourse against parent companies, they must obtain guarantees or contractual protections at the outset. GT Nelson in this case contracted with Everhall without seeking any guarantee from Magna Prima or inquiring into Everhall's financial position. That was GT Nelson's commercial decision, and the consequences of that decision must rest with GT Nelson. [261] The principles of separate legal personality and limited liability are fundamental to company law. They serve vital purposes in facilitating commerce and providing certainty in business dealings. These principles must be maintained except in clear cases of abuse. The present case, despite involving a parent company's oversight of its subsidiary's affairs, does not constitute such abuse. [262] For all the reasons set out in these grounds, I make the following orders: a) GT Nelson's claim against Magna Prima is dismissed. b) GT Nelson shall pay costs of RM30,000.00 to Magna Prima, subject to allocatur. c) The existing Judgment in Default obtained by GT Nelson against Everhall on 30.12.2023 for the sum of RM1,680,000.00 together with interest at 5% per annum from the date of Writ until full settlement and costs remains valid and enforceable. 10 February 2026 ATAN MUSTAFFA YUSSOF AHMAD Judge Kuala Lumpur High Court (Commercial Division) Counsel: For the Plaintiff: Desmond Ho and Liew Shi Yi (Messrs Richard Wee Chambers) For the 2nd Defendant: So Chien Ho (Messrs Zailan & Co.)