Khoo Peng Lai Tan v Ah Hin & 7 Lagi (26NCC-26/2011)

TAN AH HIN (NRIC No.: 570328-10-6189)

KHO AH TEE (NRIC No.: 480316-71-5025)

KHO YOW MING (NRIC No.: 840820-14-5785)

TE SOH PENG (NRIC No.: 750401-10-5800)

DATO’ NIK ISMAIL BIN NIK YUSOFF (NRIC No.: 460902-03-5497)

DATO’ ABDUL LATIF BIN MOHAMAD (NRIC No.: 480630-03-5183)

LIM NEOW HWA (NRIC No.: 570603-03-5080)

TELEMONT SDN BHD (COMPANY No.: 533734-U) ….RESPONDEN-RESPONDEN DI HADAPAN YANG ARIF TUAN MOHD NAZLAN BIN MOHD GHAZALI HAKIM JUDGMENT Introduction [1] This is an application for an order of committal against the respondents. [2] After having heard submissions by parties at the hearing, I dismissed the application and stated my key grounds for so deciding. This judgment contains the full grounds for my decision. Key Background Facts [3] There is a fair bit of history of Court proceedings involving the parties to this application. For present purposes, it suffices that I refer to them only in summary fashion, mainly adapted from my own judgment in Khoo Peng Lai v Tan Ah Hin & Ors [2016] 1 LNS 450 which concerned an application to amend an Order of the Court (which I shall also refer to later). [4] The present proceedings found their origin in a petition filed by the petitioner pursuant to Section 181(1) of the Companies Act 1965 (“the CA”) (“the Petition”). The petitioner is a shareholder, holding 10% of the share capital of the 8th respondent company, Telemont Sdn Bhd. Page 3 of 21 He was also a former director on the board of the 8th respondent and had resigned on 2 July 2007. [5] The 1st to the 7th respondents were directors of the 8th respondent at the material time. The petitioner had alleged that the respondents, amongst others, had oppressed his rights as a minority shareholder by excluding him from the management of the 8th respondent company, namely Telemont Sdn Bhd (“Telemont”). [6] On 28 February 2013, after a full trial, this Court, in the judgment of her Ladyship Hanipah Farikullah J granted, amongst others, for purposes relevant to this judgment, the following orders:

Pendaftar Syarikat Malaysia dan/atau Suruhanjaya Syarikat Malaysia diperintahkan mengemaskini (rectify) daftaran (the register) untuk menggambarkan pegangan saham sebenar Pempetisyen dalam Responden Ke-8 (Telemont Sdn Bhd (No. Syarikat: 533734-U), yakni 3,150,000 saham-saham ‘ordinary shares’ bernilai RM1.00 setiap satu;

Seorang Juru Odit bebas daripada firma KPMG dilantik untuk menyiasat dan mengodit akaun-akaun Telemont Sdn Bhd (No. Syarikat: 533734-U) bermula dari tahun 2005 sehingga tarikh Perintah yang dibuat di dalam ini; ………………………..

Pengarah-Pengarah Telemont Sdn Bhd diperintahkan untuk membenarkan kesemua rekod-rekod Telemont Sdn Bhd diperiksa oleh Pempetisyen dan Pempetisyen diberikan kebenaran (leave) untuk mengambil apa-apa langkah-langkah yang diperlukan demi melindungi kepentingan Telemont Sdn Bhd; ………………………..

Bahawa pihak-pihak diberikan kebenaran untuk membuat permohonan lanjut kepada Mahkamah yang mulia ini untuk arahan dan/atau perintah yang lanjut dan/atau yang lain untuk tujuan perlaksanaan sewajarnya ke atas perintah-perintah di dalam ini. [7] The Order dated 28 February 2013 (“the Original Order”) thus granted the petitioner the right to access the company accounts and documents of the 8th respondent. The petitioner then took steps to enforce the Original Order by requesting the respondents to grant him Page 4 of 21 access to the accounts and documents of the 8th respondent and its subsidiaries as well. [8] However, since the Original Order, as can be seen from the above, did not expressly provide for the inspection of accounts and documents of the 8th respondent’s subsidiaries, nor indeed make mention of the existence of any of the 8th respondent’s subsidiaries, the respondents chose not to accede to the petitioner’s request. [9] The petitioner then successfully obtained an order from her Ladyship Hanipah Farikullah J of this Court on 12 September 2013 amending the Order by the inclusion of the words ‘….dan kesemua anak-anak syarikatnya’ into prayers (b) and (f) of the Order (“the Amended Order”), which as a result now reads as follows:-

Seorang Juru Odit bebas daripada firma KPMG dilantik untuk menyiasat dan mengodit akaun-akaun Telemont Sdn Bhd (No. Syarikat: 533734-U) dan kesemua anak-anak syarikatnya bermula dari tahun 2005 sehingga tarikh Perintah yang dibuat di dalam ini;

Pengarah-Pengarah Telemont Sdn Bhd diperintahkan untuk membenarkan kesemua rekod-rekod Telemont Sdn Bhd dan kesemua anak-anak syarikatnya diperiksa dan disalinkan oleh Pempetisyen dan/atau juruodit/juruakaun/profesional-profesional yang dilantik olehnya dan Pempetisyen diberikan kebenaran (leave) untuk mengambil apa-apa langkah-langkah yang diperlukan demi melindungi kepentingan Telemont Sdn Bhd;…” [10] The respondents’ appeals against both the Original Order and the Amended Order were refused by the Court of Appeal on 28 February 2013 and 12 September 2013 respectively. [11] It ought to be noted that both the Orders do not name the specific subsidiaries. It is plain from the Amended Order that despite the inclusion of the reference to the 8th respondent’s subsidiaries, the identities of the subsidiaries were not however specified in the same. [12] The dispute between the parties however is precisely on whether certain identified companies are subsidiaries of the 8th respondent. As such, the petitioner had continued to insist on access to the accounts and documents of companies which he contended were subsidiaries of the 8th respondent, but which the respondents strenuously denied. These companies are:-

Modal Jati Berhad (Company No.: 103729-X) (“MJB”);

MJB Forestry Sdn Bhd (Company No.: 663624-W) (“MJBF”);

Jejaka Makmur Sdn Bhd (Company No.: 313510- W) (“JMSB”);

Sindiyan Sdn Bhd (Company No.: 388706-T) (“SSB”); and

Alifya Forestry Sdn Bhd (Company No.: 348623-H) (“AFSB”) (collectively “the Disputed Companies”). [13] The petitioner was then successful before his Lordship Harmindar Singh Dhaliwal J (as he then was) of this Court in his subsequent application for leave to commence committal proceedings against the respondents for their alleged failure to abide by the Amended Order to grant the petitioner access to the accounts and documents of the Disputed Companies, said to be the 8th respondent’s subsidiaries. [14] Pending the hearing for the order of committal in enclosure 72, and the counter application to set aside leave for the committal in enclosure 82, the respondents then filed an application to vary the Amended Order, to specifically name the subsidiaries of the 8th respondent, which according to the respondents, did not include the Disputed Companies. [15] That was enclosure 100 and heard before me. The contention of the petitioner was that the Disputed Companies were indeed the subsidiaries of the 8th respondent. [16] I dismissed the same, on account of among others, res judicata, and on the basis that the grounds of judgment accompanying the Original Order had actually made a specific finding of fact given that the identities of the subsidiaries of the 8th respondent had been set out, which crucially included the Disputed Companies (see my decision on the said enclosure 100 in Khoo Peng Lai v Tan Ah Hin & Ors [2016] 1 LNS 450 referred to earlier). [17] After my decision to dismiss the application to vary the Amended Order, the respondents filed an appeal against my decision on enclosure 100. I then allowed the respondents’ application to stay the pursuit of the committal proceedings in enclosures 82 and 72 pending disposal of the same. The Court of Appeal affirmed this Court’s Page 6 of 21 dismissal of enclosure 100. The respondents further failed to obtain leave to appeal against that decision of the Court of Appeal to the Federal Court. [18] The proceedings on enclosure 82 to set aside the leave for committal was subsequently heard before me. I dismissed the same. Hence the present proceedings for committal against the respondents now before this Court. Primary Contentions of Parties [19] The crux of the respondents’ argument against the order of committal is the primary and by now familiar contention that the identities of the subsidiaries of the 8th respondent in question, namely MJB and its subsidiaries were not subject to the Amended Order as they had been disposed of earlier. These subsidiaries were not even named in the Amended Order. The grounds of the decision (as opposed to the Orders) allowing the petition which mentioned that MJB and its subsidiaries were subsidiaries of the 8th respondent were based on company searches with the Companies Commission of Malaysia way back in 2009/2010 which had been made before the filing of the Petition in April of 2011. The identities of the subsidiaries too were not even part of the issues for adjudication. [21] The other key argument of the respondents is that at the time of the filing of the application for leave on 27 January 2015, all respondents apart from the first and second respondents had ceased to be directors of the 8th respondent. Further, the sealed Amended Order was only served on the 4th, 5th, 6th, and 7th respondents subsequent to their resignation as directors. In addition, the petitioner had failed to disclose that the appointment of KPMG would require a substantial amount of RM1 million as initial retainer, not to mention the fees, neither of which the 8th respondent would be in a financial position to pay. [22] The petitioner however, challenged the grounds put forth by the respondents. He maintained that the attempt by the respondents to amend the Amended Order by excluding the Disputed Companies had been refused by this Court in my dismissal of enclosure 100, which decision had been affirmed by the Court of Appeal. The Disputed Companies thus remained the subsidiaries of the 8th respondent. It was argued that if the disposal of MJB did take place, it meant that the 1st and 2nd respondents had caused the disposal of MJB to themselves, and Page 7 of 21 this would constitute a specific intention to frustrate the Original Order and Amended Order. Further, if MTB were indeed sold to the 1st and 2nd respondents, which was claimed to have been for RM10 million, the petitioner questioned as to how the said consideration had been accounted for and where the same was documented. [23] The petitioner further contended that the resignation of the relevant respondents, if true, would not be relevant since under the Original Order and Amended Order, the obligation on the part of the respondents was premised on individual, and not official capacity. Even though the relevant Form 49 of the CA on the status of directorships has now been shown to the petitioner, this was never previously raised to the petitioner from the time of the filing of the Petition. Evaluation and Findings by this Court First Issue – Whether the Disputed Companies are subsidiaries of the 8th respondent The Earlier Findings [24] Whether the Disputed Companies were the subsidiaries of the 8th respondent at the material time remains and still is the overarching issue that would largely determine whether or not the respondents were in contempt of the Amended Order. [25] This application for committal against the respondents is also fashioned by the petitioner on the basis that the respondents had willfully breached the Amended Order which caused an interference with the administration of justice. The acts of contempt complained of in the Order 52 statement included primarily the accusation that the respondents had caused MJB and its subsidiaries to be transferred out from Telemont secretly and illegally to avoid the enforcement of the Amended Order. [26] It is useful that I reiterate that the respondents are asserting that at all material times, the Disputed Companies, which were never named as parties to the Petition, were not subsidiaries of the 8th respondent Telemont. In particular, they maintain that:-

MJBF, JMSB, SSB AND AFSB were never the direct subsidiaries of the 8th respondent; they were instead subsidiaries of MJB. This much is not disputed.

MJB was previously a subsidiary of the 8th respondent but had ceased to be a subsidiary since November 2010, when the 8th respondent had disposed of its shares in MJB. Since the Petition was filed on 19 April 2011, and the Original Order was given on 28 February 2013 and the Amended Order was allowed on 12 September 2013, at all these material dates, MJB was therefore no longer a subsidiary of the 8th respondent in that 8th respondent or Telemont no longer owned any shares in MJB. This is the true bone of contention in this dispute. [27] The respondents thus insisted that at all relevant times, including presently, neither MJB nor any of the Disputed Companies are subsidiaries of the 8th respondent, and that the 8th respondent does not own any shares in any of the Disputed Companies, as can be seen from the records as filed at the Companies Commission of Malaysia. [28] And as I have mentioned, in my decision on enclosure 100 in Khoo Peng Lai v Tan Ah Hin & Ors [2016] 1 LNS 450, I had made the ruling that the grounds of judgment accompanying the Original Order had already made a specific finding of fact that the identities of the subsidiaries of the 8th respondent crucially included the Disputed Companies. Subsequent and Contrary Specific Finding of Fact by Court of Appeal on the Disputed Companies [29] There is however one very significant and subsequent development with repercussions on this instant committal action. This is a related suit, in a form of an originating summons instituted by certain parties (including Wawasan Dengkil Properties Sdn Bhd, to whom MJB was said to have been sold, and others) to set aside the very Amended Order which is the subject-matter of the instant committal proceedings. The appeal against its dismissal was allowed at the Court of Appeal, which however granted only certain prayers in the originating summons. [30] The decision of the Court of Appeal as reported in Wawasan Dengkil Properties Sdn Bhd & Ors v Khoo Peng Lai & Ors [2016] 9 CLJ 517 is especially pertinent for it contains an express finding of the Court of Appeal on the very specific issue of whether MJB was a subsidiary of the 8th respondent. And all the arguments against MJB being a subsidiary as repeated herein had also been raised in that appeal proceedings. Page 9 of 21 [31] In order to present a clear and complete picture of the observations and conclusions of the Court of Appeal relevant to the issue herein, it would be remiss of me not to reproduce the relevant passages from the judgment of the Court as delivered by Mary Lim JCA, as follows:- “[18] It is best to set out the terms of the amended order so that we can appreciate the complaints of the appellants. The following highlighted amendments that the appellants sought to set aside:

Seorang Juru Odit bebas daripada firma KPMG dilantik untuk menyiasat dan mengodit akaun-akaun Telemont Sdn Bhd... dan kesemua anak-anak syarikatnya bermula dari tahun 2005 sehingga tarikh perintah yang dibuat di dalam ini;

3....;

4....;

5....;

Pengarah-Pengarah Telemont Sdn Bhd diperintahkan membenarkan kesemua rekod-rekod Telemont Sdn Bhd dan kesemua anak-anak syarikatnya diperiksa dan disalinkan oleh Pempetisyen dan/atau juruodit/juruakaun/professional-professional yang dilantik olehnya dan pempetisyen diberikan kebenaran (leave) untuk mengambil apa-apa langkah-langkah yang diperlukan demi melindungi kepentingan Telemont Sdn Bhd;

7....;

8....; [19] The basic argument of the appellants is that the amended order cannot be granted because Jejaka Makmur and Modal Jati were not owned by Telemont at the material time. The material time being the time of both the original order and the amended order. By these dates, both Modal Jati and Jejaka Makmur were no longer owned by Telemont because the ownership in both Modal Jati and consequently Jejaka Makmur had changed with the sale of Modal Jati. Unfortunately, the appellants were not able to raise these arguments because of the principle of res judicata and issue estoppel. On the merits, the learned judge was also not with the appellants”. [32] The above passages repeat the same contention of parties, and focused on the key terms of the Amended Order. The Court of Appeal then continued:- Page 10 of 21 “[22] These are our views. First of all, it merits mention several undisputed matters amongst which is the integrity of the SPA. It is a non-issue as the trial court in the 181 Petition had found that the SPA had been stamped on 29 August 2012. Second, it would appear that the change of ownership is also not in dispute. Modal Jati was sold to the two directors who are the second and third respondents in this appeal on 11 November 2010, and they then sold Modal Jati to Wawasan Dengkil, the first appellant through the SPA on 17 August

Jejaka Makmur remained fully owned by Modal Jati until 18 March 2013 when its shares in Jejaka Makmur were subsequently transferred to Wawasan Dengkil. Third, it is also not in dispute that the material time would be the dates of the two orders, the original order on 28 February 2013 and the amended order on 10 September 2013. [emphasis added] [33] The above is significant, for it pronounced that Modal Jati (or MJB) was sold on 11 November 2010, thus validating the version proffered by the respondents. If a clearer articulation of the finding is necessary, one need not look further than to the following passages in the judgment which focused on this very question:- “Status of Modal Jati And Jejaka Makmur [42] A central issue in the Setting Aside OS is the status of Jejaka Makmur: was it still a subsidiary of Telemont at the two material dates of the original order and the amended order. If the answer is in the affirmative, was there a suppression of material facts before the learned judge in the 181 petition which affected the proper making of the amended order on 10 September 2013. On the first aspect of the issue, the appellants argued in the negative while KPL, the first respondent maintained that Jejaka Makmur was still a subsidiary. [43] The learned judge concluded that at the time of the said order, Jejaka Makmur was a subsidiary of Telemont and Modal Jati. Her Ladyship relied on the testimony of TAH given during the 181 petition (that the structure and assets of Telemont and its group of companies since KPL's exit from Telemont in 2007 had been maintained); that TAH was a director of both Telemont and Modal Jati; and that the learned judge in the 181 petition had made a finding of fact that Jejaka Makmur "is a wholly owned subsidiary of Modal Jati which came under the control and direction of Telemont, "a holding company for several subsidiaries". Various parts of the grounds of decision were identified, including para. 2: Based on the evidence before me, the facts are as follows:

Telemont Construction Sdn Bhd (Company No. 609021-D) ("Telemont Construction"); and

(ii) Modal Jati Sdn Berhad (Company No. 103729-X) ("Modal Jati"). A copy of the search conducted in the Companies Commission of Malaysia on Telemont Construction is annexed to this petition and marked as "P7". A copy of the search conducted in the Companies Commission of Malaysia on Modal Jati is annexed to this petition and marked as "P8".

(iii) The wholly owned subsidiaries of Modal Jati, which came under the control and direction of Telemont:

MJB Forestry Sdn Bhd (Company No. 663624-W) ("MJB

Jejaka Makmur Sdn Bhd (Company No. 313510-W) ("Jejaka Makmur"); …..

Alifya Forestry Sdn Bhd (Company No. 384623-H) ("Alifya Forestry"); …..

Sindiyan Sdn Bhd (Company No. 388706-T) ("Sindiyan"). Copies of the searches conducted in the Companies Commission of Malaysia on MJB Forestry, Jejaka Makmur, Alifya Forestry and Sindiyan are annexed to this petition and marked as "P9", "P10", "P11" and "P12" respectively. (emphasis added) [44] With the corporate structure as set out earlier, it becomes evidently clear that Telemont's ownership of Jejaka Makmur is through Modal Jati. The moment Telemont ceases to own Modal Jati, it can no longer count Jejaka Makmur as its subsidiary, direct or indirect. From the above findings of the trial judge in the 181 petition, it appears that the court there was in fact describing a different company: Telemont Construction Sdn Bhd with registration number of 609021-D, and not Telemont Sdn Bhd with a registration number of 533734-U. The 181 petition is not against Telemont Construction Sdn Bhd but against Telemont Sdn Bhd (Company No. 533734-U). There is no SSM search on Telemont Construction Sdn Bhd, only Telemont Sdn Bhd. This serious discrepancy is enough to warrant intervention by this court. [45] Proceeding nevertheless on the assumption that the learned judge's description of Telemont and the various subsidiaries is correct, that is still of no real assistance to the issue of whether the collateral proceedings undertaken by the appellants to set aside the amended order in relation to the appellants was properly initiated and was one of merit. The answers and evidence identified by the learned judge must be examined in terms of the material date of the said order. It appears from the record of appeal that exhs. P7 and P8 were SSM searches conducted in 2009 (pp. 101 to 106 in R/A Jil. III for P8; and pp. 113 to Page 12 of 21 118 in R/A Jil. III for P7). There is no point saying that Model Jati or even Jejaka Makmur was owned by Telemont but the present owner of either company is not before the court at the time of pronouncement of any order especially one which is intended to be affected by the present owner. The present owner of Jejaka Makmur, who are the appellants, were never notified of the 181 Petition proceedings or even the application to amend. In such circumstances, the appellants' application has merit. [46] In any event there is evidence aplenty before the High Court in the Setting Aside OS to show that Modal Jati was no longer a subsidiary of Telemont by the time of the said order. This evidence was produced by both the appellants and KPL. First, there were the relevant resolutions of Telemont and Modal Jati. These resolutions dated 1 November 2010 authorised the disposal of Telemont's shares in Modal Jati and the transfer of those shares to the two directors - see pp. to 238 of R/A Jil. III. Then, there is the SSM search on Jejaka Makmur that was conducted on 28 August 2012 (see pp. 151 to 157 of R/A Jil. II). This valid and material search shows that by the time of the decision in the 181 petition on 28 February 2013, Modal Jati was not a subsidiary of Telemont. Evidence of the director recorded during the trial of the 181 petition must also be treated with caution as it was given in the context of a 181 petition against Telemont and not its subsidiaries. Certainly, it was not against any other company, whether Modal Jati or Jejaka Makmur. [47] The above position of the ownership of Modal Jati and Jejaka Makmur was confirmed by the other respondents before us. Although learned counsel for KPL had suggested that these parties were not without bias, it cannot be denied that their position is borne out by the contemporaneous documents already before the court”. [34] In summary, the above key passages from the judgment state the crucial findings, as supported by contemporaneous documents such as company resolutions and company searches that MJB and hence its own subsidiaries, including Jejaka Makmur, were no longer subsidiaries of the 8th respondent at the time of the filing of the Petition, more so the Amended Order. That much is clear. [35] The Court of Appeal also furnished its analysis as to why the earlier finding that the Disputed Companies were subsidiaries of the 8th respondent at the material time cannot be sustained, as follows:- “[35] When the grounds of decision in the 181 petition are examined, the issue of ownership of Modal Jati and thereby Jejaka Makmur by the appellants was never in contention. Instead, the issue arising in the 181 petition was quite focused and narrow: whether the several Page 13 of 21 acts complained of by KPL amounted to acts of oppression under s. 181 of the Companies Act….. [36] The above clearly indicates that all of KPL's concerns and complaints focused in and on Telemont. That comes as no surprise as Telemont was the investment holding company and KPL operated at the level of Telemont. [37] …….However, none of the matters raised by KPL, discussed and examined by the trial court in the 181 Petition come even close to the matters of change of ownership or disposal of Telemont's entire shares in Modal Jati to the two directors or worse, of the disposal of the same shares by the two directors to Wawasan Dengkil. The issue of the disposal of shares and specifically of Telemont's shares in Modal Jati was never under consideration. That being the case, we cannot find the operation of the doctrine of res judicata and the extended principle of issue estoppel…… [49] There was nothing to indicate that any of the subsidiaries were also under scrutiny in the 181 petition. Those parts of the judgment as identified by the learned High Court Judge in the Setting Aside OS serve only to describe the companies that fall within the group. Even then, there was no ascertainment of the position of those subsidiaries as at the date of the decision. There was no ascertainment because it was not relevant to the petition which was only against Telemont. Had that question been examined, the trial judge in the 181 petition would have found that Modal Jati was no longer owned by Telemont as per resolution passed on 1 November 2010 and as registered on 18 March 2013. ….. [53] We must add that there must be available before the court the correct and necessary parties at the time of the making of any order for the simple reason that the order needs compliance. At the time of these orders, as evident from the grounds of decision in the 181 petition, the company searches on Telemont, Modal Jati and Jejaka Makmur were those conducted in 2009. Given that KPL was interested in securing orders against subsidiary companies, it was imperative that the latest SSM searches were made available. There are no records of any search produced to the court in the 181 petition at the time of the amendment. Where it is shown that the status as found in the 2009 searches no longer holds true, and the appellants have successfully shown this to be the case, then an order made under such erroneous conditions, without the new owners present, is clearly one which is liable to be set aside. The rules of natural justice must always be observed. Where there is a breach of those rules as was the case here, we agree that the appellants have been prejudiced by the lack of fair play. We further agree with the appellants that a fit case for Page 14 of 21 setting aside and impeachment of the Amended Order has consequently been made out under the principles as laid down in Badiaddin Mohd Mahidin & Anor v. Arab Malaysian Finance Bhd [1998] 2 CLJ 75”. [36] As such, in the instant case, having evaluated the requisite Order 52 statement supporting this committal application, the affidavits and submissions by parties on the key allegation that the respondents had failed to grant the petitioner access to the accounts and documents of MJB and its subsidiaries in accordance with the terms of the Amended Order, although this Court had in enclosure 100 previously refused to make further amendment to the Amended Order to specifically include the names of the subsidiaries of Telemont and noted that Modal Jati had already been identified as a subsidiary of Telemont in the grounds of decision of the High Court which allowed the minority oppression action against the Respondents, it cannot however now be denied that the Court of Appeal in Wawasan Dengkil had made an express and specific finding that MJB (and thus necessarily its own subsidiaries, including Jejaka Makmur) had been disposed of by Telemont, being the 8th respondent, in the year 2010. [37] I cannot but emphasize that this disposal was undertaken prior even to the filing of the Petition for minority oppression by the petitioner against the respondents in April 2011 and way before the grant of the Amended Order in September 2013. As such, clearly, it cannot be said that the respondents had refused access, what more deliberately, to MJB if at the time of service of the Amended Order, MJB and its subsidiaries were no longer subsidiaries of Telemont, being the 8th respondent. Or that the disposal of MJB was in any manner orchestrated to circumvent the Amended Order and interfered with the administration of justice. [38] It is true that there were questions posed by the petitioner on the propriety of the disposal of MJB to the 1st and 2nd respondents, or even whether the disposal was genuine in the first place. Indeed, I too had raised this question in enclosure 100. Two points of general importance and application must be made. [39] First, the determination of enclosure 72 rests entirely on affidavit evidence before this Court. On that basis, allegations on propriety of the disposal are unsubstantiated and could at best be considered as mere conjecture. So too is the allegation that the respondents had challenged the Amended Order through the filing of Page 15 of 21 various legal measures to delay the process and with the objective of enabling the respondents to continue with their act of disposing the assets of 8th respondent. This is simply not supported by affidavit evidence. [40] Neither could or should the instant committal proceedings be allowed by this Court to be transformed into the collateral forum to adjudicate on the legality of the disposal instead. These allegations by the petitioner are irrelevant to the conduct on the part of the respondents alleged to have been contemptuous, more so when it is for the petitioner to prove his case against the respondents beyond reasonable doubt. [41] Moreover, despite disputing the ownership of MJB and the Disputed Companies had been transferred, the petitioner also asserted in his Order 52 Statement that the respondents had conspired or caused MJB and its subsidiaries to be transferred out from the 8 th respondent secretly and illegally to avoid the enforcement of the Amended Order. It is unclear which position is taken by the petitioner in its application to commit the respondents. The petitioner cannot pursue his case in this fashion. He cannot blow hot and cold. He cannot approbate and reprobate at the same time. This does nothing but further weakens the case of the petitioner. [42] In the case of Bakti Dinamik Sdn Bhd v. Bauer (Malaysia) Sdn Bhd [2016] 10 CLJ 247, I stated thus:- “[43] The position taken by the plaintiffs currently may be characterised as one which violated the principle against ‘approbating and reprobating’. In the Court of Appeal case of Visage Continental Sdn Bhd v Smooth Track Sdn Bhd [2007] 6 CLJ 570, Richard Malanjum JCA (as his Lordship then was) referred to various authorities and enunciated clearly the rule that a party should not be allowed to approbate and reprobate as it is a practice that is both plainly unconscionable and unfair”. See also the decision of the Court of Appeal in Prestaharta Sdn Bhd v. Ahmad Kamal bin Md Alif & Ors [2016] 4 MLJ 39. [43] Secondly, it is trite that committal proceedings are criminal in nature since the same involve the liberty of the alleged contemnor (see the Federal Court decision in Tan Sri Dato' (Dr) Rozali Ismail & Ors v. Lim Pang Cheong & Ors [2012] 2 CLJ 849). Page 16 of 21 [44] In Re Bramblevale Ltd [1970] 1 Ch 125, Lord Denning MR in his characteristic inimitable style stated the principle on the applicable standard of proof for contempt proceedings: “A contempt of court is an offence of a criminal character. A man may be sent to prison for it. It must be satisfactorily proved. To use the time - honoured phrase, it must be proved beyond reasonable doubt”. [45] As such, the allegations of the petitioner cannot be sustained. They are not supported by affidavit evidence, and more significantly came nowhere close to meeting the threshold of establishing the case of contempt on the standard of proof of beyond reasonable doubt. [46] For substantially the same reasons, the argument that there is a conflicting Court of Appeal decision in respect of enclosure 100 which affirmed my decision refusing to vary the Amended Order (on the application of the respondents herein to specify the subsidiaries which did not include the Disputed Companies) similarly would be untenable. [47] In this connection, it is useful if reference is made to the decision in Dewan Perniagaan Melayu, Malaysia Negeri Johor (menuntut melalui pegawai awamnya, Mohadi b Sardi) v Menteri Besar Johor & 2 Ors [2017] 4 AMR 434, where I stated thus:- “Important set of principles on contempt charge [36] The law governing the grant of committal orders is fairly settled. A discussion on the same is unnecessary for the purposes of this instant application. However, as distilled from the various authorities, as a guide, I wish to reiterate, in summary fashion, four key principles that courts must take into account when examining the terms of the court orders contended to have been infringed or not complied with by an alleged contemnor. These are:

(A) Contempt proceedings are criminal in nature because they involves the liberty of the alleged contemnor (see the Federal Court decision in Tan Sri Dato' (Dr) Rozali Ismail & 2 Ors v Lim Pang Cheong @ George Lim & 4 Ors [2012] 2 AMR 429; [2012] 2 CLJ 849);

(B) A charge of contempt must therefore be proved beyond reasonable doubt (see the English Court of Appeal decision in

(C) It is a fundamental principle of fairness that no order of court will be enforced by committal unless it is expressed in clear and Page 17 of 21 unambiguous language (see the Court of Appeal decision in Dato' Seri Yusof b Dato' Biji Sura @ Mohamad v BTM Timber Industries Sdn Bhd & Ors [2010] 1 MLJ 644; [2009] 5 CLJ 412); and

(D) Any ambiguity and uncertainty must be resolved in favour of the alleged contemnor (see the Supreme Court decision in Huong Hai Hong & Anor v MBf Holdings Bhd & Anor (and 3 Other Appeals) [1995] 4 CLJ 427). [48] Thus, even if the argument that the Court of Appeal had earlier decided differently in its affirmation of my decision in enclosure 100 is accepted, the mere fact of the existence of two different findings on the status of MJB and the Disputed Companies means that the benefit of the uncertainty must in any event be given to the alleged contemnors, in this case, the respondents. [49] In essence, the key contention that the respondents breached the Original Order or the Amended Order by refusing access to the Disputed Companies which the petitioner claimed to be the subsidiaries of the 8th respondent cannot be sustained pure and simple and must be wholly rejected because the Disputed Companies cannot under the law be considered as the subsidiaries of the 8th respondent at the material time. Furthermore, it is also observed that the respondents did give access to the petitioner (minus the Disputed Companies) through the inspection done by PKF Advisory. Second Issue – Failure to appoint KPMG [50] It cannot be denied that the appointment of KPMG would require the deposit of RM1 million for the initial retainer alone. The respondents had notified the petitioner that the 8th respondent is a dormant company and is not financially able to expend on the initial retainer sum, not to mention the actual fees to be charged. [51] In respect of the non-appointment of KPMG, I note that the respondents’ assertion that 8th respondent is not in a financial position to pay the initial retainer of RM1 million was supported by the offer to the petitioner to inspect the management accounts of the company and the proposal or a cheaper alternative of appointing another independent auditor, which was not accepted by the petitioner. [52] In my view, if the petitioner considered this unacceptable, instead of proceeding to seek leave for contempt, he could have asked Page 18 of 21 for the cross-examination of the deponent of the respondents’ affidavits. Further, in Yip Yee Foo v Edmund Charles Liebenberg [2015] 6 CLJ 217, the Court of Appeal overturned the decision to commit the alleged contemnor for contempt as it was found that the High Court did not fully consider the true relationship between the alleged impecuniosity and the breach of a Court order. Thus it was stated:- “[11] If the High Court addressed its mind to what were the acts of disobedience, defiance and interference with the due administration of justice, it would find these are arguments founded upon failure to comply with the order to pay RM6,134,033 to purchase the shares, which is not ipso facto refusal or neglect to comply with the order. ………… [14] The High Court failed to address its mind whether these raised a reasonable doubt whether the appellant could pay RM6,134,033. Instead, the High Court addressed its consideration to the question of impecuniosity….” [53] In this context, I do not consider that the respondents had willfully and contumaciously disobeyed the Amended Order, more so as there is a difference of opinion whether the law permits enforcement of payment of money or money judgment by committal proceedings. On the one hand there are cases such as the Court of Appeal decision in Hong Leong Bank Berhad v Phung Tze Thiam @ John Phuang [2008] 4 CLJ 742 which held that an order for payment of a monetary judgment cannot be enforced by means of a committal proceedings. The Court of Appeal in Hong Kwi Seong v Ganad Media Sdn Bhd [2013] 2 MLJ 251 on the other hand took the opposite position. [54] It is of interest to observe that the Singapore Court of Appeal in Mok Kah Hong v Zheng Zhuan Yao [2016] SGCA 8 discussed the divergence, preferred the view pronounced in Hong Kwi Seong, and suggested that “a distinction ought to be drawn between a judgment or order for the payment of money within a specified time, to which an order of committal is available as a mode of enforcement, and a judgment or order for the payment of money simpliciter without a specified timeframe, to which an order of committal will not be available”. [55] The requirement for the appointment of KPMG is not on a payment of money but the performance of an act. But I agree that in substance it concerns the ability of the respondents to fund the said appointment. Given the above, including considering the position in law Page 19 of 21 on the matter, I find that the assertion that the failure to appoint KPMG per se and without more would constitute a contempt of Court to be unmeritorious. Third Issue – Some of the respondents were no longer directors at the material time [56] Further, I am also of the view that given affidavit evidence in the form of the relevant Forms 49, the fourth, fifth, sixth and seventh respondents clearly in any event cannot be subject to any contempt charge vis-à-vis the terms of the Amended Order because they were not directors at the time when the Amended Order was served on them. Surely one cannot be penalized for an alleged default of a requirement that one is never subject to. What more in a committal proceedings which employs the criminal standard of proof. That is too basic a principle to require further exposition. [57] The petitioner’s argument that the alleged contemnors’ obligation to adhere to the Amended Order survives their resignation and their liability is personal in nature and not dependent on their status as directors of the 8th respondent, whilst slightly attractive, is manifestly misconceived. The basis that the proceedings had been taken against them was minority oppression for they were in control as majority shareholders and directors of the 8th respondent. Their resignation as directors must mean that they relinquish the authority of managing the 8th respondent, for it is trite that Section 131B of the Companies Act 1965 which then governed the parties stated as follows:

The business and affairs of a company must be managed by, or under the direction of, the board of directors.

The board of directors has all the powers necessary for managing and for directing and supervising the management of the business and affairs of the company subject to any modification, exception or limitation contained in this Act or in the memorandum or articles of association of the company. [58] For completeness even if there was an argument (which there is none) that the respondents as shareholders could ensure that access be granted to the petitioner to the books of the Disputed Companies, this must likewise fail for not only the reason that the Disputed Companies were not subsidiaries of the 8th respondent to start with, but also on the ground that as shareholders, they had no powers of Page 20 of 21 management to procure access be granted. In Wong See Yaw & Another v Bright Packaging Industry Berhad [2016] 6 CLJ 465 I stated:- “[41] This provision [Section 131B] reinforces the principle that the articles divide the powers of the company between the directors and the shareholders, and the latter cannot under the law direct the former on how to exercise the powers properly within the remit of the directors as stipulated in the articles. I need only refer to the passage from the judgment of Lord Wilberforce in delivering the opinion of the Privy Council in the case of Howard Smith Ltd v. Ampol Petroleum Ltd [1974] AC 821 which made the point instructively as follows: The constitution of a limited company normally provides for directors, with powers of management, and shareholders, with defined voting powers having power to appoint the directors, and to take, in general meeting, by majority vote, decisions on matters not reserved for management... it is established that directors, within their management powers, may take decisions against the wishes of the majority of shareholders, and indeed that the majority of shareholders cannot control them in the exercise of these powers while they remain in office”. Conclusion [59] In view of the foregoing analysis, on the basis of the Order 52 Statement and the affidavit evidence, disregarding unproven inferences, and by reason, principally of the grounds as stated aforesaid, and especially cognizant that committal proceedings are quasi-criminal in nature, I cannot arrive at any conclusion other than the inevitable finding that the petitioner had not successfully beyond reasonable doubt proven its case of contempt of Court or interference with the administration of justice against the respondents. [60] Accordingly, I hereby dismiss enclosure 72, with costs. Dated: 8 November 2017 (MOHD NAZLAN BIN MOHD GHAZALI) Judge High Court NCC1 Kuala Lumpur Page 21 of 21 Counsel: For the Petitioner HY Lee with Joseph Ting and Bruce Toh Messrs Joseph Ting Puchong, Selangor For the Respondents Tan Jee Tjun with Lavinia Kumaraendran Messrs Thomas Philip Kuala Lumpur