Lee Tin Hui v 1. ) Gl Property Management Sdn Bhd (WA-24NCC-339-07/2024)

GL PROPERTY MANAGEMENT SDN BHD (No. Syarikat: 124177-K)

LEE HIONG KIAT

KEE CHAI HONG (NO. K/P: 610806-13-5384) …DEFENDAN-DEFENDAN

On 19-12-2024, this Court found in favour of the Plaintiff in this minority oppression suit and ordered, inter alia, that a forensic auditor, property valuer and accountant be appointed by agreement between the parties (“Order”). The appointments were necessary next steps to ascertain the value of the shares of the 1st Defendant (“Company”) in order to effect the order that the 2nd Defendant buy-out the Plaintiff’s shares in the Company.

The parties were unable to agree on the experts to be appointed. On 15-8-2025, the Plaintiff filed Enclosure 26 for consequential orders under the “liberty to apply” clause in the Order. It was common ground that the Court was empowered to make the consequential orders sought, and that they were necessary to give effect to the Order.

After deliberation, this Court selected the candidates proposed by the Plaintiff. The 2nd and 3rd Defendants have appealed this Order. Analysis and findings

At the outset of the hearing of Enclosure 26, the parties confirmed that they were at least in agreement that the forensic auditor and accountant to be appointed should be from the same team. Thus, it was mainly a contest between PricewaterhouseCoopers Advisory Services Sdn Bhd (“PwC”) and Andersen Malaysia Sdn Bhd (“Andersen”).

The property valuers in contention were Rahim & Co International Sdn Bhd and Irhamy Valuers International Sdn Bhd whose respective proposals did not differ in any material aspect.

No issue was raised about the lack of independence or impartiality among the proposed candidates. The 2nd and 3rd Defendants had submitted that their proposed candidates should be selected, principally because of the difference in fee quote between PwC and Andersen. They say that the Company is a family-owned investment holding company with rental income from 1 asset and the engagement of PwC is beyond what the task requires.

The relevant extracts from the proposals of PwC and Andersen are extracted below for comparison: Forensic Auditor Criteria PwC Andersen Qualifications/ Experience of lead Alex Tan, Certified Fraud Examiner 35 years of investigative experience Soo Lynnie, Chartered Accountant 22 years in accounting and corporate advisory Scope of work Review non tax deductible expenses on a sampling basis and compile potential LHDN penalties in relation to deemed interest relating to director’s loans from 2018 to 2024; preparation of forensic report Conduct a forensic analysis for FY 2018 to 2023 and provide a forensic audit report Cost RM87,600 RM24,000 Independent Accountant (valuation) Criteria PwC Andersen Qualifications/ Experience of lead Justin Lim, Chartered Accountant 19 years experience with valuation advice and support for dispute resolution, shareholder transactions, mergers & acquisitions and Jayems Dhingra, Chartered Valuer and Appraiser More than 4 decades in the industry verticals, frequently engaged in assignments like business valuations, due diligence, acquisitions, and statutory financial reporting purposes… mergers, resolving various operational issues.. Scope of work Prepare and issue a report containing independent assessment of the valuation of the Company together with the bases thereof; may consider and combine results from 3 main approaches (Income, Market and Cost Approach); procedures likely to be followed to arrive at valuation To provide an opinion on the Fair Market Value of the shares in the current state of the Company and its operating assets; will use market value as the standard of value on a going-concern premise, assuming the business will continue to operate normally, utilizing its usable Assets to generate income; delivery schedule until final Valuation Report Cost RM95,000

This Court considered that the PwC proposals would better assist the Court for the following reasons: a) PwC has fielded leads with more relevant experience in forensic investigation and share valuation; b) The PwC proposal sets out a more considered scope of work to meet the intended purpose of their engagement in the forensic investigation of the Company’s operation and accounts; and c) PwC did not limit the basis of valuation to a single approach as Andersen has done.

The scope of work of the property valuer and share valuation expert in this case are obvious. In respect of the forensic auditor, the scope of work set out in the Order is to “investigate the operations and accounts of the Company and to provide a report to this Honourable Court.” This Court finds that this must be read in conjunction with the following declarations and order that has been made, i.e.

The 2nd and 3rd Defendants have managed and/or conducted the affairs of the 1st Defendant (the “Company”) and/or exercised their powers oppressively and/or disregarded and/or acted in a manner unfair and prejudicial to the interests of the Plaintiff as a shareholder of the Company;

A declaration that all loans by the Company to the 2nd Defendant and/or 3rd Defendant are unlawful;

A declaration that the payment of directors’ remuneration and statutory contributions to the 2nd Defendant and/or 3rd Defendant in 2019, 2020, 2021, 2022 (and 2023, if any) are unlawful;

An order that the 2nd Defendant and/or 3rd Defendant pay to the Company all monies wrongfully and/or unlawfully appropriated and/or received from the Company as determined by this Honourable Court.

In light of the above orders, the purpose of the forensic auditor is to provide a report to the Court that would identify and quantify sums payable by the 2nd and/or 3rd Defendant back to the Company. As the Court has already made findings in relation to the unauthorized loans and remuneration the 2nd and 3rd Defendants paid themselves out of the Company, a further forensic investigation must be directed at identifying any other unlawful extraction of company funds for their personal benefit and at the expense of the minority shareholders. This may manifest as improper expense claims, as PwC has identified as the focus of its intended forensic investigation.

PwC is also proposing to compile the Company’s exposure to tax and penalties relating to all “loans” taken by the 2nd and 3rd Defendants. In a forensic investigation involving the extraction of financial benefits by directors, forensic asset recovery and share valuation are closely linked. The identification of misappropriated funds and related exposure to taxes and penalties directly influence the company’s financial position, and consequently, the value of its shares. A forensic audit report that addresses such issues would therefore influence the valuation of the Company’s shares.

As it relates to valuation, in cases involving closely-held companies without an active market or comparable companies, coupled with allegations of extraction of financial benefits by directors, the market approach to share valuation may be inappropriate as the company’s financial statements and reported performance may be distorted by the financial misconduct under investigation. As also contemplated by PwC, valuation in such circumstances may favour an income or asset-based approach, not only to reflect the Company’s income but also any forensic recovery.

In considering the candidates therefore, this Court considered that all things not being equal, the fees quoted by PwC and Andersen alone cannot be the determining factor. The purpose of their appointment and their respective merits were evaluated to arrive at the Court’s conclusion.

The fees proposed by Rahim & Co International Sdn Bhd is slightly higher than Irhamy Valuers International Sdn Bhd’s fees by RM2,000.00. The choice of the property valuer was to streamline the appointments of all 3 experts by the Plaintiff for administrative convenience and efficiency.

In conclusion, the following consequential orders made by this

PricewaterhouseCoopers Advisory Services Sdn Bhd be appointed as the forensic auditor at the cost and expense of the 2nd and/or 3rd Defendants to investigate the operations and accounts of the Company and to provide a report to this Honourable Court within 2 months from the date of this Order;

Rahim & Co International Sdn Bhd be appointed as the independent property valuer at the cost and expense of the 2nd and/or 3rd Defendants to revalue the property(ies) of the Company at the current market price for purpose of valuing the shares of the Plaintiff and to provide a report to this Honourable Court within 2 months from the date of this Order;

PricewaterhouseCoopers Advisory Services Sdn Bhd be appointed as the independent accountant at the cost and expense of the 2nd and/or 3rd Defendants to value the shares of the Company as at the Order dated 19 December 2024 taking into account (i) the property valuation, (ii) the forensic auditors’ report at paragraph 1 above and (iii) declarations made by this Honourable Court in paragraphs 1, 2 and 3 of the Order dated 19 December 2024; and

The independent accountant shall complete the valuation exercise and submit a valuation report to this Honourable Court and the parties’ solicitors within 2 months from the completion of the forensic audit.

Costs of the application followed the event at RM7,500.00, subject to allocatur. Bertarikh: 21 November 2025 ELAINE YAP CHIN GAIK PESURUHJAYA KEHAKIMAN MAHKAMAH TINGGI MALAYA KUALA LUMPUR Peguam Untuk Plaintif: Fiona Bodipalar (with Pan Shan Ping) Messrs Bodipalar & Partners Untuk Defendan: Lau Kee Sern (with Eunice Aw Shze Xian) Messrs Kee Sern, Siu & Huey