Kumpulan Modal Perdana Sdn Bhd v Liew Choon Lian (BA-24NCC-131-11/2025)

23.

11.2023 BETWEEN KUMPULAN (547734-D) AND LIEW CHOON LIAN [NRIC NO. 600316-01-6201]; IN THE MATTER OF THE SHARES SALE

23.

11.2023 BETWEEN KUMPULAN (547734-D) AND LIEW CHOON LIAN [NRIC NO. 600316-01-6201]; IN THE MATTER OF ORDERS 7, 28,

BETWEEN KUMPULAN MODAL PERDANA SDN BHD [COMPANY No.: 200101011978 (547734-D)] …PLAINTIFF LIEW CHOON LIAN [NRIC No.: 600316-01-6201] …DEFENDANT [MAIN ACTION] LIEW CHOON LIAN [NRIC No.: 600316-01-6201] …PLAINTIFF IN THE COUNTERCLAIM KUMPULAN MODAL PERDANA SDN BHD [COMPANY NO.: 200101011978 (547734-D)] …DEFENDANT IN THE COUNTERCLAIM [COUNTER CLAIM]

This is the Defendant's application in Enclosure 7 to convert the Plaintiff's Originating Summons into a writ action pursuant to Order 28 rule 8 of the Rules of Court 2012 (ROC). The Defendant also seeks that the counterclaim raised in the Defendant's Affidavit in Reply be tried together with the Plaintiff's claim, should the conversion be allowed.

I heard the parties at length and considered the affidavits filed, the written submissions, the authorities cited and the oral submissions of counsel. I dismissed the application. I now set out my reasons.

The Plaintiff commenced this action by way of Originating Summons seeking relief arising from a Put Option Agreement. The Plaintiff's position is that the Put Option Agreement creates an obligation on the Defendant to purchase the shares upon the exercise of the option.

The Defendant does not dispute the existence of the Put Option Agreement. This was confirmed during oral submissions when counsel for the Defendant stated that the Defendant is "not disputing that the Put Option Agreement has been signed".

The Defendant, however, contends that the Plaintiff's claim is premature because the Plaintiff allegedly failed to comply with the right of first refusal mechanism contained in the company's constitution.

In addition to resisting the Plaintiff's claim, the Defendant also raised a counterclaim in the Affidavit in Reply. The Defendant alleges that a payment of RM1,000,000 to the Plaintiff was made by mistake and that the Plaintiff has therefore been unjustly enriched.

Based on these allegations, the Defendant seeks to convert the proceedings into a writ action on the basis that the dispute allegedly requires viva voce evidence.

The Defendant submits that there are serious disputes of fact which cannot be resolved by affidavit evidence.

The Defendant argues that the Put Option Agreement cannot operate independently of the company's constitution and the shareholders' agreement. According to the Defendant, the right of first refusal mechanism contained in the constitution must first be complied with before the Put Option can be exercised.

The Defendant further submits that the payment of RM1,000,000 was made by mistake because the Defendant was not aware of the right of first refusal provisions at the time the payment was made.

The Defendant therefore argues that issues of mistake and unjust enrichment require a full trial with witnesses being called and cross-examined.

In support of this submission, reliance was placed on several authorities, including Ting Ling Kiew & Anor v. Tang Eng Iron Works Co Ltd [1992] 2 MLJ 217 and HSBC Bank Malaysia Bhd v. Wong Thien Boon & Ors [2008] 6 CLJ 381, where the courts emphasised that where there are conflicts in material evidence, such disputes should be resolved through a full trial.

The Plaintiff opposes the application and submits that the Defendant has not demonstrated any genuine dispute of fact.

The Plaintiff submits that the real dispute between the parties concerns the construction and legal effect of the Put Option Agreement and the company's constitution.

According to the Plaintiff, the Defendant's argument on prematurity is essentially a question of contractual construction.

The Plaintiff further submits that the Defendant's counterclaim arises from the same issue raised in the Originating Summons. The Defendant alleges that the payment of RM1,000,000 was made by mistake because the Plaintiff was allegedly not entitled to exercise the Put Option.

The Plaintiff therefore submits that if the Court determines whether the Put Option Agreement validly creates the obligation alleged by the Plaintiff, that determination would also resolve the Defendant's allegation of mistake.

It is therefore the Plaintiff's position that the dispute can be determined on affidavit evidence without converting the proceedings into a writ action.

The Court's power to convert proceedings commenced by Originating Summons into a writ action is provided under Order 28, Rule 8 of the ROC.

Order 28, Rule 8 gives the Court discretion. The rule provides that where, in the opinion of the Court, the proceedings should for any reason continue as if the cause or matter had been begun by writ, the Court may order the proceedings to continue accordingly and may give directions necessary for the future conduct of the matter.

The rule, therefore, does not make conversion automatic merely because parties raise disputes.

Order 28 must also be read together with Order 28 Rule 4. Under Rule 4, the Court retains broad powers in managing an Originating Summons. The Court may determine the matter on affidavit evidence, direct oral evidence, permit cross-examination of deponents, or give such directions as may be necessary for the fair disposal of the matter.

This is important because the Rules recognise that the existence of some disputes or factual disagreements does not necessarily require the entire proceedings to be converted into a writ action.

Order 28 rule 7 further expressly permits a defendant in an Originating Summons to raise a counterclaim. The mere existence of a counterclaim therefore does not by itself require conversion.

The discretion to convert must be exercised where there are substantial disputes of fact which cannot fairly be resolved through affidavit evidence.

However, it is not sufficient for a party to merely assert that there are disputes of fact. The Court must examine the nature of the dispute and determine whether it truly requires a full trial.

Where the dispute primarily concerns the interpretation or legal effect of written documents whose existence and contents are not disputed, the Originating Summons procedure is generally appropriate. Analysis and Findings Nature of the dispute

Having considered the parties' submissions, I find that the dispute concerns primarily the legal effect of the written agreements relied upon by the parties.

The Defendant does not dispute the existence of the Put Option Agreement. The Defendant's case is that the Put Option Agreement cannot be exercised unless the right of first refusal provisions in the company's constitution are complied with first.

The Plaintiff's position is that the Put Option Agreement creates an independent contractual obligation which is not affected by the right of first refusal provisions.

The dispute therefore, centres on the relationship between the Put Option Agreement and the company's constitution.

In substance, I am of the view that the dispute turns on the construction and legal effect of these documents.

The terms of these documents are already before the Court. Their existence and contents are not disputed. The issue is therefore one of interpretation and legal consequence rather than factual controversy. Such issues are generally suitable to be determined through the Originating Summons procedure. The Defendant's counterclaim

The Defendant relies heavily on the counterclaim for recovery of RM1,000,000 on the basis of mistake and unjust enrichment. However, when the Defendant's case is examined carefully, the alleged mistake is not based on an independent factual dispute.

The Defendant's case is that the payment was made because the Defendant believed that the Plaintiff was entitled to demand payment under the Put Option Agreement.

The Defendant now says that the payment was made without knowledge of the right of first refusal provisions contained in the constitution.

It therefore becomes necessary to ask the following questions.

If the Court ultimately finds that the Put Option Agreement validly imposed an obligation on the Defendant to purchase the shares and to make the payment, on what basis can the Defendant maintain that the payment of RM1,000,000 was made by mistake?

Conversely, if the Court finds that the Plaintiff's exercise of the Put Option was premature because the right of first refusal provisions must first be complied with, does that finding not already address the Defendant's allegation that the payment was not legally due?

In either situation, the issue raised in the counterclaim depends on the same legal question that arises in the Originating Summons.

The Defendant's counterclaim, therefore, does not arise from a separate factual matrix. It arises from the same transaction, the same payment and the same alleged legal consequences of the Put Option Agreement.

In this sense, I find that the counterclaim is not independent of the Plaintiff's claim. It is contingent upon the determination of the same underlying issue. Whether oral evidence is necessary

During oral submissions, the Court asked counsel for the Defendant what witnesses would be called if the matter proceeded to trial.

Counsel indicated that the Defendant would call his client and cross-examine the Plaintiff's witnesses regarding the effect of the constitution and the circumstances surrounding the payment.

In my view, this supports the conclusion that the central issues concern the constitution's construction and the interaction between the relevant agreements. These are primarily questions of interpretation of the documents rather than issues turning on the credibility of witnesses.

Counsel for the Defendant also accepted during oral submissions that cross-examination of deponents could still be conducted within the Originating Summons procedure if necessary.

This demonstrates that the existing procedure is capable of addressing any limited factual clarification that may arise.

Furthermore, I find that the Defendant has not identified any specific factual dispute which cannot fairly be resolved through affidavit evidence.

Having simultaneously perused the cause papers, affidavits, exhibits and submissions filed in Enclosure 1, I was satisfied that the real dispute between the parties concerns the construction and legal effect of the Put Option Agreement, the Constitution and the Shareholders' Agreement, all of which are already before the Court.

The material facts relating to the execution of the agreements, the issuance of the Put Option Notice and the payment of RM1,000,000 are substantially not disputed. In the circumstances, I was satisfied that the issues could fairly and properly be determined on affidavit evidence and legal submissions without the necessity of a full trial with viva voce evidence. Authorities relied upon

I have considered the authorities relied upon by the Defendant, including Ting Ling Kiew and HSBC Bank Malaysia Bhd. These authorities emphasise that where there are substantial disputes of fact, the matter should proceed to trial.

However, those authorities do not establish that the presence of a counterclaim or the pleading of mistake automatically requires the conversion of proceedings commenced by Originating Summons.

The Court must still examine whether the alleged factual disputes are genuine and material.

In the present case, the Defendant has not demonstrated that the dispute involves such factual conflicts.

Having considered the affidavits, the submissions of both parties, and the authorities cited, I am not satisfied that the Defendant has demonstrated the existence of substantial factual disputes requiring the proceedings to be converted into a writ action.

The central issues raised by the parties concern the construction and legal effect of the Put Option Agreement, the company's constitution and the related documents.

These issues can be fairly and properly determined on affidavit evidence.

Accordingly, the Defendant's application in Enclosure 7 is dismissed with costs of RM5000, subject to the allocator. Dated this: 18 May 2026 ~signed~ (NOOR HAYATI BINTI HAJI MAT) JUDGE HIGH COURT OF MALAYA SHAH ALAM, SELANGOR Representative: For the Plaintiff : Brian Mun Loong together with Anson Chee Weng Kian and Derek Kho Ngiat Liang Messrs Cheang & Ariff For the Defendant :