Kenanga Investors Berhad v 1. ) Zulrafq Capital Sdn Bhd (WA-22NCC-140-03/2023)

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1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY, MALAYSIA (COMMERCIAL DIVISION) SUIT NO.: WA-22NCC-140-03/2023 BETWEEN KENANGA INVESTORS BERHAD [Registration No. 199501024358 (353563-P)] … PLAINTIFF

Lampiran

Lampiran A; b) Consequential orders for service and filing of the amended pleadings within specified timelines; and c) Costs in the cause. RESPECTIVE PARTIES' SUBMISSIONS Submissions of Zulrafq and TSZ [19] Zulrafq and TSZ submitted that the proposed amendments do not serve to raise new issues or change the character of the pleaded Defence and Counterclaim. They contended that the nature and character of their case remains the same at all times, maintaining their position that they entered into the Put and Call Option Agreement dated 19.1.2022 based on undertakings made by Taqiuddin, that Kenanga's claim is a structured scheme or conspiracy, and that the Put Option Notice was invalid. [20] Zulrafq and TSZ argued that the proposed amendments merely refine, elaborate, and present the existing pleaded facts with greater clarity and precision. In their written submission, Zulrafq and TSZ relied on the Court of Appeal decision in ASM Development Sdn Bhd v Hijjas Kasturi Associates Sdn Bhd [2011] 6 MLJ 228, asserting that the amendments do not alter the character of the suit as they are based on existing facts which are substantially the same as the original claim. [21] Zulrafq and TSZ submitted that the amendments are confined to elaboration, clarification, and refinement of the original factual and legal contentions, all arising from the same factual matrix as pleaded in the original Defence and Counterclaim (Enclosure 7). [22] On the issue of bona fides, Zulrafq and TSZ submitted that the application was made bona fide to cure typographical errors and to elaborate on pleaded facts to assist the court in making a fair determination. They contended that the application was made immediately upon discovering the need for clarification in the pleadings, particularly subsequent to their discovery application. [23] Zulrafq and TSZ further submitted that the opposing parties would not be prejudiced by the proposed amendments, as the elaborated facts had already been raised in earlier affidavits filed in related proceedings. They contended that the trial date fixed for 8th, 9th, 10th, 11th, 17th, 18th and 19th September 2025 afforded sufficient time for the opposing parties to file amended responses. Zulrafq and TSZ argued that any prejudice could be compensated by an award of costs to the opposing parties. Submissions of Kenanga [24] Kenanga submitted that the proposed amendments are substantial and fundamentally alter the nature and character of the Defence and Counterclaim. The amendments introduce entirely new factual matrices, new parties, and a completely different narrative of events. [25] Kenanga emphasised that the application was made at a very late stage in the proceedings, approximately 22 months after the Defence and Counterclaim was first filed. By the time the amendment application was filed, trial dates had been fixed, pre-trial documents had been exchanged, and the parties had proceeded through multiple interlocutory applications based on the original pleadings. [26] Kenanga argued that Zulrafq and TSZ have failed to provide any material or cogent reasons to explain the delay in making the application. The matters sought to be pleaded were within Zulrafq and TSZ's knowledge from the outset and should have been included in the Defence and Counterclaim when it was first filed, or at the very least, in an amendment application made at a much earlier stage. [27] Kenanga submitted that many of the proposed amendments seek to introduce matters of evidence rather than material facts. Kenanga contended that the amendments are unnecessary as the matters sought to be pleaded constitute evidence that could properly be adduced at trial without any amendment to the pleadings. [28] Kenanga further submitted that the application lacks bona fides and constitutes a tactical manoeuvre to delay the proceedings. Kenanga pointed to the timing of the application, which was filed only after Zulrafq and TSZ's discovery and interrogatory applications were dismissed by this court on 23.9.2024. Kenanga argued that Zulrafq and TSZ are attempting to circumvent the dismissal of those applications by introducing, through amendment, matters that overlap substantially with items sought in those dismissed applications. [29] Kenanga also highlighted that Zulrafq and TSZ filed the same amendment application in piecemeal fashion across three related suits: first in Suit 489 on 25.1.2025 (Enclosure 182), and then in Suit 140 and Suit 141 on 17.3.2025 (Enclosures 119 and 112 respectively). Kenanga submitted that this staggered filing, with no satisfactory explanation for the different dates and timing, demonstrates that the applications are not bona fide but rather constitute a calculated tactical manoeuvre. [30] Kenanga contended that the prejudice caused cannot be compensated by costs alone. Allowing the amendments would inevitably delay the trial fixed for September 2025, would require the reopening of pleadings and the review of all parties' Summaries of Case, and might necessitate further applications for particulars. Submissions of Taqiuddin [31] As a preliminary matter, Taqiuddin raised the objection that the Proposed Amendments in “Lampiran A” were not attached to the Notice of Application dated 17.3.2025, but only to the Affidavit in Support without the required certificate of verifying exhibit, thereby contravening Order 41 Rule 11 of the ROC. Taqiuddin submitted that this was clearly a non-compliance with Order 41 Rule 11 of the ROC, and therefore the said “Lampiran A” should not be admitted as evidence. [32] On the substantive merits, Taqiuddin submitted that the Proposed Amendments are misleading and have altered the original position pleaded in the Defence and Counterclaim. For instance, whilst Zulrafq and TSZ originally pleaded that Taqiuddin had introduced Kenanga and Ismitz to Zulrafq for the transaction, the proposed amendments now allege that Taqiuddin had introduced a financial adviser named Muna Naim to Zulrafq, and that Muna Naim then introduced Ismitz to Taqiuddin. [33] Taqiuddin further submitted that there has been an inordinate delay of approximately 22 months, for which Zulrafq and TSZ have failed to provide any material and cogent reasons. The amendment application was filed at a late stage after the close of pleadings, during preparation of pre-trial documents, and with trial dates already fixed. The application constitutes a tactical manoeuvre and is not bona fide. [34] Taqiuddin contended that the prejudice caused cannot be compensated by costs alone, as allowing the amendments would inevitably delay the trial fixed in September 2025, potentially require further applications for particulars, and necessitate the reopening of pleadings and review of all parties' Summaries of Case. Submissions of Ismitz [35] Ismitz adopted similar arguments to those advanced by Taqiuddin. Ismitz submitted that the Proposed Amendments substantially change the nature and character of the Defence and Counterclaim, transforming the narrative of Zulrafq and TSZ's defence. The amendments were filed after substantial delay, are not bona fide, and constitute a tactical manoeuvre and abuse of process. [36] Ismitz emphasised that the proposed amendments introduce two additional parties (Muna Naim and Dato' Michael Chew) with more tangled contentious allegations and issues, fundamentally altering the character of the suit from a breach of contractual obligations to an alleged “induced loan facility” arrangement. [37] Ismitz submitted that the amendments alter his pleaded role from having mere knowledge of discussions to having direct involvement in undertakings made directly to him, and introduce new allegations of active involvement in receiving payments and being involved in a scheme to deliberately fail to process payments. LEGAL PRINCIPLES [38] The power to allow amendments to pleadings is conferred on the court by Order 20 Rule 5 of the Rules of Court 2012, which provides: “(1) Subject to Order 15, rules 6, 6A, 7 and 8 and the following provisions of this rule, the Court may at any stage of the proceedings allow the plaintiff to amend his writ, or any party to amend his pleading, on such terms as to costs or otherwise as may be just and in such manner (if any) as it may direct.” [39] This wide discretionary power must be exercised judiciously, having regard to the circumstances of each case. [40] The principles governing the exercise of this discretion were authoritatively established by the Federal Court in Yamaha Motor Co. Ltd v Yamaha Malaysia Sdn Bhd & Ors [1983] 1 MLJ 213. The Federal Court held: “Three basic questions should be considered to determine whether injustice would or would not result, (1) whether the application is bona fide; (2) whether the prejudice caused to the other side can be compensated by costs and (3) whether the amendments would not in effect turn the suit from one character into a suit of another and inconsistent character.” [41] These three limbs must be satisfied cumulatively. If an applicant fails on any one limb, the application must fail in its entirety. [42] However, the principles in Yamaha Motor have been importantly qualified by the Federal Court in Hong Leong Finance Bhd v Low Thiam Hoe and another appeal [2016] 1 MLJ 301. The Federal Court held at paragraph [33]: “Having considered the facts and the circumstances of the present case, our views are as follows: (a) when dealing with an application to amend the pleadings, which introduce a new case in the claim or defence, on the eve of the trial, the principles in Yamaha Motor are not the sole considerations; (b) the principles in Yamaha Motor applies to cases where the application to amend the pleadings is made at an early stage of the proceedings; (c) that there has to be a cogent and reasonable explanation in the applicant's affidavit as to why the application was filed late; (d) that the application to amend the pleadings is not a tactical manoeuvre; (e) that the proposed amendment must disclose full particulars for the court to ascertain if there is a real prospect of success in proving the same; and (f) that lateness in the application to amend the pleadings cannot necessarily be compensated by payment of costs.” [43] The Federal Court in Hong Leong Finance Bhd also quoted with approval the observations of Lord Griffiths in Ketteman and Others v Hansel Properties Ltd [1988] 1 All ER 38 at paragraph [19]: “Whether an amendment should be granted is a matter for the discretion of the trial judge and he should be guided in the exercise of the discretion by his assessment of where justice lies. Many and diverse factors will bear on the exercise of this discretion. I do not think it possible to enumerate them all or wise to attempt to do so. But justice cannot always be measured in terms of money and in my view a judge is entitled to weigh in the balance the strain the litigation imposes on litigants, particularly if they are personal litigants rather than business corporations, the anxieties occasioned by facing new issues, the raising of false hopes, and the legitimate expectation that the trial will determine the issues one way or the other. Furthermore, to allow an amendment before a trial begin, it is quite different from allowing it at the end of the trial to give an apparently unsuccessful defendant an opportunity to renew the fight on an entirely different defence.” [44] In distilling these principles, the court must consider whether the three limbs of the Yamaha Motor test are satisfied. Where amendments are sought at a late stage, particularly after trial dates have been fixed, additional considerations arise: the applicant must provide cogent and reasonable explanations for the delay, the application must not be a tactical manoeuvre, and the court must assess whether compensation by costs adequately addresses any prejudice caused. The court retains an overarching discretion to be exercised according to where justice lies in the particular circumstances of the case. ANALYSIS AND FINDINGS OF THE COURT Preliminary Objection - Non-Compliance with Order 41 Rule 11 [45] Before examining the substantive merits of the amendment application, I must first address a preliminary objection raised by Taqiuddin in his written submissions. Taqiuddin objected that the Proposed Amendments fail to comply with the applicable requirements on two grounds: firstly, that the Proposed Amendments in “Lampiran A” were not attached to the Notice of Application dated 17.3.2025, but only to the Affidavit in Support without the required certificate of verifying exhibit, thereby contravening Order 41 Rule 11 of the ROC; and secondly, that certain amendments in the Proposed Amendments are not underlined in red ink, contrary to the applicable Practice Directions of the Court. Taqiuddin pointed to specific paragraphs, particularly paragraph 4 and 26(c), where changes have been made but were not properly underlined as required. [46] Taqiuddin relied on the decision of the Court of Appeal in Lee Chye Yen & Anor (t/a 'Ebiz Solution Network') v EoneNet Com Sdn Bhd [2014] 4 MLJ 595 at pages 602-603, where the Court of Appeal held that the court was left in doubt as to the truth of the copy of the works annexed when all the exhibits annexed or exhibited to the statutory declaration did not have the endorsement of or certification by the commissioner for oath. The Court of Appeal emphasised that Order 41 Rule 11(2) of the ROC clearly provides that any exhibit to an affidavit shall be identified by a certificate of the person before whom the affidavit is sworn. The Court of Appeal further held that failure to comply with this provision may lead to the exhibits annexed being invalid and not to be admitted as evidence. [47] The Defendants acknowledged in their reply submissions that the Proposed Amendment was annexed to the Affidavit in Support dated 14.3.2025 without the required certifying exhibit, due to an inadvertent error or oversight. To rectify this, the Defendants exhibited the Proposed Amendment along with the certifying exhibit in their Affidavit in Reply dated 24.4.2025 (Enclosure 126). [48] The Defendants submitted that even if such non-compliance were established (which is strictly denied), it has not resulted in any substantial miscarriage of justice or caused irreparable prejudice that cannot be remedied by way of amendment or an appropriate order for costs. [49] The Defendants relied on the Court of Appeal decision in Kenanga Investment Bank Bhd v Swee Joo Bhd & Ors and another appeal [2017] MLJU 2095, wherein the court emphasised that substantive justice should take precedence over procedural non-compliance: “Things changed in the last few decades. Legislation as well as rules of court were in place to ensure that courts provide substantive justice and matters are not decided based on procedural non-compliance or technicalities without giving an opportunity to the litigant to correct the mistakes and/or non compliance. Lord Woolf's report and the subsequent amendment to the Rules of Court were meant to bury the application of micro jurisprudence on procedure and/or technicalities and to advance an inquisitorial and/or holistic approach to attain substantive justice. That is to say, the court has to play a part to give directions to avert the procedural and/or technical issues to cater for substantive justice. In short, court was obliged to apply macro jurisprudence to arrive at substantive justice and the game of adversarial justice on procedural non-compliance was intended to be made obsolete.” [50] The Defendants also referred to this court's decision in Hermie bin Md Tahir v AmBank Bhd [2020] MLJU 2385 wherein I dismissed a preliminary objection raised by the appellant due to the respondent's erroneous reference to the provision in the ROC for the amendment application: “I regard the erroneous reference to O. 20 r. 1 of the ROC 2012 to be merely a technical non-compliance with these rules. Despite making a reference to the incorrect rule, the Respondent was indeed seeking leave of the Court. The Appellant opposed the application by raising the usual issues when opposing an application to amend pleadings under O.20 r. 5 ROC 2012. This demonstrates that all parties concerned were aware under which actual provision the Amendment Application was made and the Respondent was actually seeking leave from the Court for the application. The Appellant was not prejudiced by the wrong reference to the rules in the Notice of Application. Having regard to the justice of the matter I dismissed the Appellant's procedural objection.” [51] Having considered the submissions, I am satisfied that the preliminary objection must be dismissed. Whilst it is true that Order 41 Rule 11 requires exhibits to affidavits to be properly certified, and that the Practice Directions require proposed amendments to be clearly identified by being underlined in red ink, and that the Defendants initially failed to comply fully with these requirements, the Defendants have since rectified the deficiency by exhibiting a properly marked-up version of the Proposed Amendments with the appropriate certifying exhibit in their Affidavit in Reply dated 24.4.2025 (Enclosure 126). All parties were aware of the nature of the amendments sought and had adequate opportunity to respond to them. The Defendants sought leave from the court for the amendments. Taqiuddin and the other opposing parties were able to fully address the merits of the proposed amendments in their written and oral submissions. Taqiuddin was not prejudiced by these technical non-compliances. [52] I regard the failure to attach the certifying exhibit and the failure to underline all amendments in red ink to be merely technical non-compliances that have not resulted in any substantial miscarriage of justice or caused irreparable prejudice. The courts have consistently held that procedural non-compliance should not defeat substantive justice where the deficiency can be cured and where the opposing party has not been prejudiced in presenting their case. As emphasised in Kenanga Investment Bank Bhd v Swee Joo Bhd, the modern approach is to apply macro jurisprudence to arrive at substantive justice rather than allowing procedural technicalities to determine the outcome. As I held in Hermie bin Md Tahir v AmBank Bhd, having regard to the justice of the matter, procedural objections of this nature should be dismissed where all parties are aware of what is being sought and no party has been prejudiced. [53] Accordingly, I dismiss the preliminary objection and proceed to examine the substantive merits of the amendment application. Whether the Proposed Amendments Would Turn the Suit from One Character into a Suit of Another and Inconsistent Character [54] I now turn to examine whether the proposed amendments would turn the suit from one character into a suit of another and inconsistent character. [55] The proper approach is to compare the original pleading with the proposed amended pleading to determine whether the essential character of the case has been changed. [56] Zulrafq and TSZ submitted that the proposed amendments do not serve to raise new issues or change the character of the pleaded Defence and Counterclaim. Zulrafq and TSZ contended that the nature and character of their case remains the same at all times, maintaining their position that they entered into the Put and Call Option Agreement dated 19.1.2022 based on undertakings made by Taqiuddin, that Kenanga's claim is a structured scheme or conspiracy, and that the Put Option Notice was invalid. Zulrafq and TSZ argued that the proposed amendments merely refine, elaborate, and present the existing pleaded facts with greater clarity and precision. In their written submission, Zulrafq and TSZ relied on the Court of Appeal decision in ASM Development Sdn Bhd v Hijjas Kasturi Associates Sdn Bhd, asserting that the amendments do not alter the character of the suit as they are based on existing facts which are substantially the same as the original claim. Zulrafq and TSZ submitted that the amendments are confined to elaboration, clarification, and refinement of the original factual and legal contentions, all arising from the same factual matrix as pleaded in the original Defence and Counterclaim (Enclosure 7). [57] In contrast, Kenanga, Taqiuddin, and Ismitz submitted that the Proposed Amendments constitute substantial amendments that drastically alter the original position pleaded in the Defence and Counterclaim. In Kenanga's written submission, it was contended that the amendments transform the character of the suit from a straightforward breach of contractual obligations into an alleged “induced loan facility” arrangement. Kenanga submitted that the Proposed Amendments introduce new parties and contentious allegations that fundamentally change the narrative, specifically by introducing an entirely new individual named Muna Naim as a central figure and by pleading that Zulrafq had in fact made payments through Muna Naim when the original Defence stated that Zulrafq made no payments. [58] Taqiuddin, in his written submission, emphasised that the Proposed Amendments are misleading and have altered the original position pleaded in the Defence and Counterclaim. Taqiuddin submitted that in paragraph 10 of the original Counterclaim (Enclosure 7), Zulrafq and TSZ had pleaded that Taqiuddin introduced Kenanga and its representative Ismitz to Zulrafq for the transaction, and that Taqiuddin communicated with representatives of KNM Group Berhad, Kenanga, and Ismitz regarding the purchase of KNM Group Berhad shares. However, in the Proposed Amendments (Lampiran A to Enclosure 120), Zulrafq and TSZ now attempt to alter these pleaded facts by alleging that Taqiuddin introduced a financial adviser named Muna Naim to Zulrafq, and that Muna Naim introduced Ismitz to Taqiuddin and advised Taqiuddin on the steps to obtain the financial facility. Taqiuddin submitted that this represents a fundamental change in position and that the Proposed Amendments seek to insert numerous facts, some of which are misleading and inconsistent with the facts previously pleaded. [59] Ismitz, in his written submission, highlighted that the proposed amendments substantially change the nature and character of the Defence and Counterclaim by altering Ismitz's role from having mere knowledge of discussions to having direct involvement in undertakings made directly to him. Ismitz submitted that whilst the initial stand was that certain material discussions relating to the Agreements were within Ismitz's knowledge, it is now alleged that there was direct involvement by Ismitz in that undertakings were made directly to him. The proposed amendments also introduce new allegations of Ismitz's active involvement in receiving payments and being involved in a scheme to deliberately fail to process payments. [60] Having carefully examined both the original Defence and Counterclaim (Enclosure 7 dated 9.5.2023) and the Proposed Amendments (Lampiran A to Enclosure 120), I am satisfied that the proposed amendments do indeed alter the character and nature of Zulrafq and TSZ's defence in material respects. [61] The original Defence and Counterclaim pleaded, in essence, that Taqiuddin had introduced Kenanga and its representative Ismitz to Zulrafq for the transaction. Specifically, paragraph 10 of the original Defence and Counterclaim (Enclosure 7) states that Taqiuddin introduced Kenanga and Ismitz to Zulrafq, and that Taqiuddin communicated with representatives of KNM Group Berhad, Kenanga, and Ismitz with regards to the purchase of the KNM Group Berhad shares. This established a relatively straightforward narrative of the parties' relationships and the manner in which they came to be involved in the transaction, namely, through Taqiuddin's direct introductions and communications. [62] However, the Proposed Amendments now seek to introduce an entirely new party, Muna Naim, described as a “financial adviser”. According to the Proposed Amendments, particularly subparagraphs 10(c) and 10(ca), it is now alleged that Taqiuddin introduced a financial adviser named Muna Naim to Zulrafq to realise the proposal, and that Muna Naim introduced Ismitz to Taqiuddin and advised Taqiuddin regarding the steps to obtain the financial facility. This represents a fundamental shift in the pleaded case regarding how the parties came to be involved in the transaction and the nature of their relationships. The narrative has changed from one where Taqiuddin directly introduced Kenanga and Ismitz to Zulrafq, to one where an intermediary, Muna Naim, played a central role in bringing the parties together. This is not a mere elaboration or clarification of the existing facts; rather, it constitutes a material alteration of the factual foundation of the defence. [63] Moreover, the Proposed Amendments introduce vagueness and ambiguity that renders the pleading embarrassing. For instance, paragraph 10(a) of the Proposed Amendments alleges that Taqiuddin made undertakings “in the presence of” Ismitz, yet fails to provide particulars as to when these alleged undertakings were made. This lack of particularity creates confusion as to the precise case that the opposing parties are required to meet and places them in a position where they cannot adequately prepare their defence to these allegations. [64] The introduction of Muna Naim as a new party, coupled with extensive new allegations about meetings, communications, and the involvement of this individual in facilitating the transaction and advising on financial facilities, goes well beyond mere elaboration of existing facts. These amendments introduce an entirely new dimension to the case that was not present in the original pleading. The original Defence focused on Taqiuddin's direct involvement and undertakings; the Proposed Amendments now seek to introduce a complex web of relationships involving Muna Naim as a central figure, fundamentally altering the character of the conspiracy and inducement allegations. [65] Furthermore, I note that the Proposed Amendments also introduce allegations regarding yet another individual, Dato' Michael Chew, and a new entity, Amanah Capital Group Limited, whose names were not previously pleaded. According to the Proposed Amendments, Taqiuddin made an advance payment of RM2,600,000.00 through Dato' Michael Chew and Amanah Capital Group Limited to Kenanga. This adds further complexity and alters the fundamental character of the counterclaim by introducing new parties and new allegations about the manner in which payments were allegedly made. [66] Additionally, the Proposed Amendments alter the pleaded facts regarding the payments made. In the original Defence and Counterclaim, it was pleaded that Zulrafq did not make any payments and that payments were made by Taqiuddin. However, in the Proposed Amendments, specifically in subparagraphs relating to the alleged loan facility arrangement, it is now suggested that Zulrafq, through Muna Naim, gave a cheque of RM2,600,000.00 to Kenanga to process the loan facility, and that Kenanga deliberately did not process the cheque and returned it to Zulrafq. This represents a fundamental inconsistency with the original pleading and materially alters the factual case that must be met. [67] The Proposed Amendments also introduce an entirely new characterisation of the transaction as an “induced loan facility” arrangement. This is a radical departure from the original pleading, which characterised the transaction as a Put and Call Option Agreement. The introduction of this new characterisation fundamentally changes the nature of the dispute and the legal issues that must be determined. [68] In ASM Development, the Court of Appeal considered whether proposed amendments changed the character of the suit. The court held that the amendments sought were based on existing facts which were substantially the same facts as the original claim. Crucially, the court found that the amendments arose out of documents produced by the defendant in the exchange of documents exercise, and that the amendments merely elaborated on the same professional fees claim arising from the same contract. [69] The present case is distinguishable from ASM Development. Here, the amendments do not arise from any discovery process. The Defendants’ discovery application in Suit 489 was dismissed by this court on 23.9.2024, and no new evidence has emerged to justify or necessitate these amendments. Unlike ASM Development, where the amendments merely elaborated on the same claim using documents from the defendant’s own possession, the amendments here fundamentally alter the cast of characters and the transactional narrative. [70] In Smijaya Sdn Bhd & Ors v Perwira Affin Bank Bhd [2010] 3 MLJ 54, the Court of Appeal considered whether the proposed amendments would fundamentally alter the nature of the suit. The court observed that the new version of the defence was markedly different from the original. The amendments introduced issues relating to the plaintiffs’ involvement in providing advice and in estimating the defendants’ profits - matters that had not formed part of the initial defence, which had been confined to the plaintiff’s advice on purchasing USD during the financial crisis. The court concluded that the changes were substantial rather than minor, carried a risk of significant prejudice to the plaintiff, and were not put forward in good faith. [71] The Court of Appeal in Smijaya further observed that the proposed amendment was not bona fide, stating at paragraph [16]: “[16]...Pada hemat kami pihak defendan mengambil kesempatan dengan menangguk di air keroh. Permohonan yang bukan bona fide harus ditolak.” [In our view, the defendant took advantage by fishing in troubled waters. An application that is not bona fide should be rejected.] [72] The principles in Smijaya are directly applicable to the present case. The proposed amendments here, like those in Smijaya, represent a major change in the pattern of the pleaded case rather than a minor elaboration. The original Defence and Counterclaim portrayed a direct relationship between Taqiuddin and the transactions, whereas the proposed amendments introduce an entirely different cast of intermediaries and a fundamentally altered narrative of how payments were made and agreements were reached. This is precisely the type of change in character that the courts have consistently held should not be permitted through late amendment applications. [73] I find that the Proposed Amendments constitute a substantial alteration of the Defence and Counterclaim that goes far beyond mere elaboration, clarification, or refinement. The introduction of new parties such as Muna Naim, Dato' Michael Chew, and Amanah Capital Group Limited; the fundamental change in the pleaded facts about who introduced whom and who made what payments; the introduction of a new characterisation of the transaction as an “induced loan facility” arrangement; and the new allegations about deliberate failure to process cheques, all serve to transform the character of the suit from a relatively straightforward commercial dispute into something substantially different and materially more complex. [74] I am satisfied that allowing these amendments would cause injustice to Kenanga, Taqiuddin, and Ismitz that cannot be adequately compensated by costs. The opposing parties have prepared their case on the basis of the original Defence and Counterclaim. They are now confronted with a substantially different case involving new parties, new factual allegations, and a fundamentally altered narrative. This places them in a position where they must substantially reconfigure their entire approach to defending the counterclaim. The prejudice occasioned by such a fundamental shift in the pleaded case cannot be remedied merely by an award of costs. [75] For the reasons set out above, I find that the Proposed Amendments alter the character of the Defence and Counterclaim from one character into a suit of another and inconsistent character. This alone is sufficient to warrant the dismissal of the application on this ground. Whether the Application Was Made Bona Fide [76] I now turn to examine whether the application was made bona fide. This requires consideration of whether there has been delay in bringing the application, and if so, whether cogent reasons have been provided to explain the delay. [77] The Federal Court in Hong Leong Finance Bhd v Low Thiam Hoe held that if an amendment application is made at a later stage of proceedings, especially after the trial dates have been fixed, the applicant must provide material and cogent reasons to explain the delay in making the application for amendment where such application is made at a late stage in the proceedings. Such an unexplained delay in making an amendment application is often associated with a lack of good faith unless the delay is excusable and has been sufficiently explained. This is fatal to an amendment application. [78] In the present case, the Defence and Counterclaim was filed on 9.5.2023. The amendment application was only filed on 17.3.2025, a gap of approximately 22 months. During this 22- month period, the Defendants had ample opportunity to identify any deficiencies in their pleadings and to seek amendments. [79] The Defendants. argument that there is no delay because trial has not yet commenced is unpersuasive. The definition of “advanced stage” is inherently fact-sensitive and depends on the context and circumstances of each case. It is not confined merely to whether trial has physically commenced. [80] As was observed by the High Court in Gurbachan Singh & Ors v Tetuan Muthu & Lee & Anor [2001] MLJU 82, after pleadings are deemed closed, an amendment can only be made with the leave of court. When a party requires discretion to be exercised in its favour, delay is always a relevant consideration because a court will only assist the vigilant and not the indolent. [81] Furthermore, the case of JPK (M) Sdn Bhd (dalam likuidasi mendakwa melalui Cheng & Co Corporation Recovery Sdn Bhd) v Sunny Tech (M) Sdn Bhd & Ors [2018] MLJU 945) which the Defendants rely upon to argue that their Enclosure 119 was not filed at an "advanced stage" of the proceedings, does not support their position as it pertains to an application to withdraw an action and is entirely unrelated to any amendment of pleadings. [82] The present case must be considered in its proper context. By the time this amendment application was filed, trial dates had been fixed for 8, 9, 10, 11, 17, 18 and 19 September 2025. The parties were in the midst of preparing pre-trial documents. The Bundle of Pleadings and the Summaries of Case of the respective parties had already been filed. Multiple interlocutory applications had been heard and determined based on the original pleadings. The action had progressed significantly beyond the stage where amendments can be made as of right or without serious disruption to the litigation process. [83] I am guided by the High Court’s decision in Stanlan Golf Services Sdn Bhd v Aim Realty Construction Sdn Bhd [2022] MLJU 393, where the court dismissed an amendment application despite the trial not having commenced. The court held that despite case management sessions and pre-trial directions given to ensure just, expeditious, and economical disposal of the action, the defendant made a late application. The court found this was a clear case of delay, and the defendant bore a heavy burden to provide material and cogent reasons for the delay. At paragraph [38] of the grounds of judgement, the court emphasised that the application was not made because of recent occurrences or the uncovering of new facts pursuant to any discovery process, but rather, due to the defendant’s indolence in not pleading these facts when it has knowledge of the same since the inception of the suit. The court stated it could not condone such apathy and lackadaisical attitude. At paragraph [44], the court pointed out that the issue was not a recent occurrence and the pleadings would have to be reopened, more documents would have to be exchanged between the parties for purposes of the Bundle of Documents for the trial and the other pre-trial documents would have to be reviewed. The court held that this is certainly most undesirable considering the history of the proceedings where these new claims and relief are within the defendant’s knowledge from the beginning and should have been included in the Defence and Counterclaim in the first place or at the very least, in an amendment application made at a much earlier stage of the proceedings. [84] Similarly, in Astana Modal (M) Sdn Bhd v BS Testing Laboratory Sdn Bhd & Ors [2021] MLJU 132, the High Court found that an amendment application was made at a late stage of proceedings after the action had been set down for full trial. At paragraph [31] of the grounds of judgement, the court noted that by the time the plaintiff filed its amendment application, twelve case management sessions had been conducted and the plaintiff did not notify the court of its intention to apply for amendment of writ or Statement of Claim prior to the application. By the time the amendment application came up for hearing and decision, all the parties’ respective Witness Statements had been filed, and the action had been fixed for full trial. At paragraph [32], the court held that according to the principle decided by the courts, cogent explanation for the delay is required, and the failure to provide such explanation is fatal, especially where the amendments sought are substantial in nature. At paragraph [40], the court found and concluded that there was delay in the plaintiff’s amendment application and the plaintiff had not provided material and cogent reasons for the delay. The court also found that the delay in amendment application would prejudice the full trial dates set by the court for the case. [85] The Defendants’ contention that the amendment application was a natural flow of proceedings following the discovery and interrogatory applications is without merit. The discovery application in Suit 489 was filed on 20.5.2024 and dismissed on 23.9.2024. Instead of filing the amendment application immediately subsequent to the discovery application being dismissed, the Defendants waited nearly six months until 17.3.2025 to file the amendment application. The Defendants’ assertion that the amendment application was made immediately subsequent to the discovery application is clearly unsubstantiated and devoid of merit. After a lapse of approximately six months from the dismissal of the discovery application, and a lapse of 22 months from the filing of the Defence and Counterclaim, the Defendants filed this application for amendment. This sequence of events undermines the Defendants’ explanation that the amendment was filed immediately upon discovering a need for clarification subsequent to the discovery application. [86] In Klass Corp (M) Sdn Bhd v Mkrs Management Sdn Bhd [2016] MLJU 1857, the High Court held at paragraph [16] that it is axiomatic that the longer the delay the more cogent and convincing the reasons must be explaining the cause of the delay. It is only too evident that an application to amend one’s pleadings either just before trial or after trial has started, has a disruptive effect on the trial, often derailing and delaying it further. Precisely because of this deleterious effect that a late application for amendment has on a trial, it is often associated with a lack of good faith unless the delay is excusable as in having been sufficiently explained. [87] In K Rajashekar a/l Kanapathy & Ors v Palm Court Condominium & Ors [2014] 9 MLJ 297, the court held at paragraph [27] that the court is and should be less ready to allow a very late amendment than it used to be in former times, and that a heavy onus lies on a party seeking to make a very late amendment to justify it. The later an application is made, the stronger would be the grounds required to justify it. The delay must be explained and justified. A failure to explain the delay is fatal especially where the amendments sought are substantial in nature. Last minute applications are to be discouraged as they would inevitably entail an adjournment, and an award of costs may not adequately compensate someone who is desirous of concluding a piece of litigation which has been hanging over his head. [88] I therefore find that there has been an inordinate delay in bringing this amendment application, and the Defendants have failed to provide any cogent or material reasons to explain or justify this delay. This failure to explain the delay is fatal to the application, particularly given the substantial nature of the proposed amendments. [89] The principle that courts should assist the vigilant and not the indolent, as stated in Gurbachan Singh, is applicable to the present case. The Defendants had every opportunity to plead their case properly from the outset, but failed to do so. The Defendants have demonstrated indolence rather than vigilance in the conduct of this litigation. [90] I therefore find that the application was not made bona fide and is tainted with mala fides, thereby failing this limb of the Yamaha Motor test. Whether Prejudice Can Be Compensated by Costs [91] Zulrafq and TSZ submitted that the opposing parties would not be prejudiced by the proposed amendments, as the elaborated facts had already been raised in earlier affidavits filed in related proceedings. They contended that the trial date fixed for 8th, 9th, 10th, 11th, 17th, 18th and 19th September 2025 afforded sufficient time for the opposing parties to file amended responses. Zulrafq and TSZ argued that any prejudice could be compensated by an award of costs to the opposing parties. [92] Kenanga, Taqiuddin and Ismitz submitted that the prejudice caused could not be compensated by costs alone. They argued that allowing the amendments would inevitably delay the trial fixed for September 2025, would require the reopening of pleadings and the review of all parties' Summaries of Case, and might necessitate further applications for particulars. Kenanga, Taqiuddin and Ismitz contended that the parties were currently in the midst of preparing pre-trial documents, with the Bundle of Pleadings and the Summaries of Case of the respective parties having already been filed. They submitted that the strain of litigation, the inefficiency in conducting the case, and the delay in disposing of the action could not be compensated by costs. [93] The question is not whether the opposing parties can be compensated in money for any prejudice suffered, but whether the justice of the case lies in allowing the amendment. In Hong Leong Finance Bhd v Low Thiam Hoe, the Federal Court cited with approval the observation of Lord 38. Griffiths in Ketteman v Hansel Properties Ltd [1988] 1 All ER In that case, Lord Griffiths observed that justice cannot always be measured in terms of money, and that a judge is entitled to weigh in the balance the strain the litigation imposes on litigants, the anxieties occasioned by facing new issues, the raising of false hopes, and the legitimate expectation that the trial will determine the issues one way or the other. Lord Griffiths further observed that another factor that a judge must weigh in the balance is the pressure on the courts caused by the great increase in litigation and the consequent necessity that, in the interests of the whole community, legal business should be conducted efficiently. [94] In the present case, allowing the amendments would cause significant prejudice to the opposing parties that cannot be adequately compensated by an award of costs. Firstly, the opposing parties have prepared their case, filed their defences to the counterclaim on 9.5.2023, and prepared their summaries of case on the basis of the existing pleadings. The Bundle of Pleadings and the Summaries of Case of all parties have already been filed. The opposing parties have a legitimate expectation that the trial will proceed on the issues as currently pleaded. [95] Secondly, if the amendments were allowed, the opposing parties would be required to file amended defences to the counterclaim, addressing the new allegations and the substantial changes to the pleaded facts. This would inevitably require time and would delay the trial. Taqiuddin, in his Affidavit in Reply dated 9.4.2025, stated that if the proposed amendments were allowed, there was a possibility that he might need to file an application for further and better particulars in the pleadings, given that the proposed amendments were misleading. I accept this. Given the substantial nature of the proposed amendments, it is likely that the opposing parties would need to seek further and better particulars, which would lead to further interlocutory applications and further delay. [96] Thirdly, the trial has been fixed for 8th, 9th, 10th, 11th, 17th, 18th and 19th September 2025. If the amendments were allowed in July 2025, there would be insufficient time for the opposing parties to properly prepare their amended responses and for all necessary interlocutory applications to be heard before the trial date. Allowing the amendment application at this stage would necessitate a reopening of pleadings and review of all parties' Summaries of Case. This would inevitably lead to the postponement of the trial dates fixed in September 2025. The vacation of the trial dates would cause further delay and prejudice to all parties. [97] Fourthly, this action has been pending since 20.3.2023 when it was filed by Kenanga. The opposing parties have a legitimate interest in having the matter brought to trial and resolved expeditiously. On 13.6.2023, Kenanga filed a summary judgment application against Zulrafq and TSZ. On 22.11.2023, summary judgment was entered by Kenanga against Zulrafq and TSZ in respect of the main action. This summary judgment remains unexecuted pending the resolution of the counterclaim. On 9.12.2023, Zulrafq and TSZ filed an application to stay the execution of the said summary judgment. On 13.3.2024, this application for a stay of execution was dismissed by this court. If these facts were truly material and within their knowledge, there is no acceptable explanation for why they were not pleaded in May 2023 when the Defence and Counterclaim was originally filed. [98] The prejudice to the opposing parties cannot be adequately compensated by costs. In Astana Modal, the High Court, citing the Federal Court in Hong Leong Finance Bhd v Low Thiam Hoe, held that factors to be considered in assessing prejudice include: (a) the defendants having the case hanging over their heads for a much longer period of time; (b) the defendants' desire to have the case heard and disposed of expeditiously; (c) the defendants having to endure a much longer period of time in having to reorganise their defences, call additional witnesses, compile additional documents and evidence for a relatively much more complicated full trial with additional causes of action, new reliefs and substantial quantity of new factual allegations. [99] In the present case, the trial has been hanging over the heads of Kenanga, Taqiuddin, and Ismitz since 2023. They have a legitimate desire to have this matter heard and disposed of expeditiously. If the amendment is allowed, they will have to reorganise their defences, potentially call additional witnesses, and prepare for a more complicated trial based on substantially altered pleadings. The trial dates fixed for September 2025 would inevitably have to be vacated or postponed. This prejudice cannot be compensated by costs. [100] The court must also take into account the efficient conduct and disposal of cases in the modern administration of justice. As noted in Anthony Wee Soon Kim v UBS AG (No 2) [2003] 2 SLR 554, cited with approval in Klass Corporation, litigants must be aware that with increased emphasis on the efficient conduct and disposal of cases, they must be responsible in the way they conduct their cases. The fact that a litigant is able to pay costs and a proposed amendment will not cause prejudice or irreparable prejudice to its adversary will not ensure that an application to amend will be granted. [101] First, the trial dates have been fixed for 8, 9, 10, 11, 17, 18 and 19 September 2025. Considerable time and resources have been invested by all parties and by the court in progressing this matter towards trial. The parties have exchanged draft Issues To Be Tried, draft Agreed Facts, and Proposed Bundle of Documents. To allow the amendments at this late stage would undermine all that preparatory work and necessitate its repetition. [102] The pleadings would have to be reopened. More documents would have to be exchanged between the parties for purposes of the Bundle of Documents for the trial, and the other pre-trial documents would have to be reviewed. The reopening of pleadings and review of the parties' Case Summaries, the Agreed Facts, the Issues To Be Tried and List of Witnesses would be required. This is certainly most undesirable considering that these matters were within Zulrafq and TSZ's knowledge from the beginning and should have been included in the Defence and Counterclaim in the first place or at the very least, in an amendment application made at a much earlier stage of the proceedings. The consequence would be wasteful and inefficient, and would undermine the diligent case management that has brought this matter to the brink of trial. [103] Second, this is not an isolated piece of litigation. There are two related suits (Suit 141 and Suit 489) involving overlapping parties and similar issues. The same amendment applications have been filed in those suits. A decision to allow amendments in this suit would have ramifications for the conduct of those related suits as well. The interests of efficient and coordinated case management across all three related suits militate against allowing belated amendments. [104] Third, the Federal Court in Hong Leong Finance Bhd v Low Thiam Hoe emphasised that justice is not always measured in monetary terms. The Federal Court observed that a judge is entitled to weigh in the balance the strain the litigation imposes on litigants, particularly if they are personal litigants rather than business corporations, the anxieties occasioned by facing new issues, the raising of false hopes, and the legitimate expectation that the trial will determine the issues one way or the other. Furthermore, allowing an amendment before a trial begins is quite different from allowing it at the end of the trial to give an apparently unsuccessful defendant an opportunity to renew the fight on an entirely different defence. In the present case, the trial is imminent. To allow the amendments at this late stage would raise false hopes for Zulrafq and TSZ, cause anxiety to the opposing parties who must face new issues, and undermine the legitimate expectation of all parties that the issues are settled and the trial will determine those issues one way or the other. [105] Fourth, the argument advanced by Zulrafq and TSZ that the amendment application is merely a natural flow of the proceedings following the Order 14, discovery and interrogatory applications is without merit. The fact that multiple applications have been filed and disposed of in this matter only underscores the protracted nature of these proceedings and the need for finality. The dismissal of the discovery and interrogatory applications in Suit 489 by this court on 23.9.2024 ought to have brought closure to those matters. Instead, Zulrafq and TSZ have sought to circumvent those dismissals by introducing, through amendment, matters that overlap substantially with items sought in those applications. This demonstrates a lack of bona fides and a tactical manoeuvre to delay the proceedings. [106] Fifth, allowing the amendments at this late stage would be contrary to the policy of the court-managed system of administration of justice to dispose of cases smoothly, expeditiously and economically. The parties have been working towards trial in September 2025 based on the pleadings as currently constituted. To reopen the pleadings at this late stage would derail those preparations, waste the time and resources already invested, and potentially necessitate an adjournment of the trial dates. [107] I therefore find that the prejudice caused to Kenanga, Taqiuddin and Ismitz cannot be compensated by costs. The considerations of efficient administration of justice, the legitimate expectations of the parties, and the strain of litigation all weigh heavily against allowing the amendments at this late stage. The Court’s Discretion and Overall Justice of the Case [108] Even if the Defendants had satisfied the three limbs of the Yamaha Motor test, which they manifestly have not, the court retains an overarching discretion whether to allow an amendment based on where justice lies in the particular circumstances of the case. [109] In Low See Hua & Anor v Chin Yok Fa & Ors [2017] MLJU 1615, the High Court emphasised that in exercising its discretion, the court must be minded that the decision will be based on the facts and circumstances of the individual case. No two cases are alike, and the circumstances of the case vary from case to case. Each case must be considered on its own merits. [110] Having regard to all the facts and circumstances of this case, I am satisfied that justice favours the dismissal of the amendment application for the following reasons. [111] First, the cumulative effect of the various factors I have identified is decisive. The proposed amendments fundamentally change the character of the suit. There has been an inordinate and unexplained delay of approximately 22 months. The application was made at an advanced stage when trial dates have been fixed and pre-trial preparations are well underway. The amendments seek to introduce evidence rather than material facts. The application is not bona fide but rather constitutes a tactical manoeuvre. The prejudice to the opposing parties cannot be compensated by costs. [112] Second, the courts can no longer afford to show the same indulgence towards the negligent conduct of litigation as was perhaps possible in a more leisured age. There will be cases in which justice will be better served by allowing the consequences of the negligence of the lawyers to fall on their own heads rather than by allowing an amendment at a very late stage of the proceedings. The Federal Court in Hong Leong Finance Bhd v Low Thiam Hoe, quoting with approval the observations of Lord Griffiths in Ketteman and Others v Hansel Properties Ltd, emphasised that a judge is entitled to weigh in the balance the pressure on the courts caused by the great increase in litigation and the consequent necessity that, in the interests of the whole community, legal business should be conducted efficiently. [113] Third, allowing the amendments at this late stage would be contrary to the policy of the court-managed system of administration of justice to dispose of cases smoothly, expeditiously and economically. The parties have been working towards trial in September 2025 based on the pleadings as currently constituted. To reopen the pleadings at this late stage would derail those preparations, waste the time and resources already invested, and potentially necessitate an adjournment of the trial dates. [114] Fourth, the Defendants must bear the consequences of their failure to plead their case properly from the outset, or at least to seek amendments at an earlier stage when such amendments could have been accommodated without significant disruption. The interests of efficient administration of justice, the rights of the opposing parties, and the proper conduct of litigation all militate against allowing amendments at this late stage in the circumstances of this case. [115] Fifth, I accept the submission that this amendment application is a tactical manoeuvre by way of an afterthought and not bona fide. The timing of the filing of Enclosure 119 in March 2025, some 22 months after the filing of the Defence and Counterclaim, and approximately six months after the dismissal of the discovery and interrogatory applications in Suit 489, suggests a calculated attempt to introduce new matters after seeing the positions taken by the opposing parties and after previous applications have been dismissed. The staggered filing of similar applications across the three related suits further reinforces this conclusion. The Defendants have provided no satisfactory explanation for the timing and manner of these applications. [116] Sixth, the opposing parties are entitled to proceed to trial on the basis of the pleadings as currently constituted. They are entitled to the finality and certainty that comes from having settled pleadings. They are entitled to have their legitimate expectation of trial in September 2025 fulfilled without further delay or disruption. [117] Seventh, to countenance the kind of belated and inadequately explained amendment application made in this case would encourage similar applications in other cases, to the detriment of the efficient administration of justice. [118] For all these reasons, even if the Defendants had satisfied the technical requirements of the Yamaha Motor test, I would still exercise my discretion to refuse the amendments on the basis that justice, properly understood, requires that parties be held to their pleadings and that litigation be conducted efficiently and without avoidable delay. CONCLUSION [119] For the reasons set out above, I find that the Proposed Amendments: a) Alter the character of the Defence and Counterclaim from one character into a suit of another and inconsistent character; b) Were not made bona fide but rather constitute a tactical manoeuvre to circumvent the dismissal of the discovery and interrogatory applications and to delay the proceedings; c) Were made with substantial and unexplained delay of approximately 22 months; and d) Would cause prejudice to the opposing parties that cannot be compensated by costs. [120] Any one of these findings would be sufficient to warrant the dismissal of the application. Cumulatively, they lead inexorably to the conclusion that the justice of this case lies firmly against allowing the amendments. [121] The Defendants must bear the consequences of their failure to plead their case properly from the outset, or at least to seek amendments at an earlier stage when such amendments could have been accommodated. The interests of efficient administration of justice, the rights of the opposing parties, and the proper conduct of litigation all militate against allowing amendments at this late stage in the circumstances of this case. [122] Accordingly, the Defendants' Notice of Application dated 17.3.2025 (Enclosure 119) is hereby dismissed with costs. [123] Costs are fixed at RM5,000.00 (subject to allocatur) to be paid by the Defendants to each of the opposing parties, namely Kenanga, Taqiuddin, and Ismitz respectively. [124] For the avoidance of doubt, the Defendants shall proceed to trial on the basis of the Defence and Counterclaim dated 9.5.2023 (Enclosure 7) as currently pleaded, without the benefit of the proposed amendments set out in Lampiran A to the Affidavit in Support dated 17.3.2025 (Enclosure 120). 24 November 2025 ATAN MUSTAFFA YUSSOF AHMAD Judge Kuala Lumpur High Court (Commercial Division) Counsel: For the Plaintiff/First Defendant in Counterclaim: Shaikh Abdul Saleem with Teoh Jo Vi (Messrs Shaikh David & Co) For the Defendants/Plaintiffs in Counterclaim: Datuk J Shamesh with Poh Jun Yang (Messrs Jeeva Partnership) For the Second Defendant in Counterclaim: Shirlena A/P Yogeswaran (Messrs James Monteiro) For the Third Defendant in Counterclaim: Victor Pang Chee Siong (Messrs Justin Voon Chooi & Wing)