Lina Yap AI Lin (F) v Giant Rewards Sdn. Bhd. (Q-02(NCvC)(A)-281-02/2022)

The 1st Defendant, 2nd Defendant, 3rd Defendant and 4th Defendant are hereby ordered jointly and/or severally to furnish the Plaintiff with all the Original instruments allegedly executed by the Plaintiff in effecting the transfer of the Plaintiff's 25,000 shares in Giant Rewards Sdn. Bhd. (Co. No. 201501038362 / 1163683-W) to the 3rd Defendant for the Plaintiff's record; These documents and/or instruments will be collectively referred to as the Documents and/or Instruments. [2] The OS was dismissed by the High Court. We allowed the appeal and we now give our reasons. Parties [3] The Appellant was a shareholder and director to the $ 1^{\mathrm{st}} $ Respondent company since 2017. The $ 2^{\mathrm{nd}} $ and $ 3^{\mathrm{rd}} $ Respondents are the current directors of the $ 1^{\mathrm{st}} $ Respondent and the $ 4^{\mathrm{th}} $ Respondent is the company secretary. Background facts [4] On 30-7-2021, the Appellant discovered from a search of the records of the Companies Commission of Malaysia (CCM) dated 30-7- 2021 that she had ceased to be a director of the $ 1^{\mathrm{st}} $ Respondent on 31-5- 2018 with her resignation (enclosure 5/10-11). The same search revealed that she had also ceased to be a shareholder of the $ 1^{\mathrm{st}} $ Respondent on 26-6-2018 pursuant to a voluntary transfer of all her 25,000 shares to the $ 3^{\mathrm{rd}} $ Respondent (enclosure 5/15-16). [5] Thereafter on 4-8-2021, the Appellant obtained two documents namely Register of Member and Notification of Change in the Register of Directors, Managers and Secretaries. These documents essentially showed the information as stated above, namely the transfer of her 25,000 shares to the $ 3^{rd} $ Respondent on 26-6-2018 (from the Register) and she had ceased to be a shareholder and the reason for her cessation as director was due to resignation (from the Notification of Change). [6] The Appellant subsequently purchased various documents from the e-system of CCM. According to the Appellant, as at 11-9-2021, the Documents and/or Instruments are not made available in the public domain of CCM. Refer to exhibit "YAL-29", enclosure 6/80. [7] The Appellant through her advocates wrote to the $ 1^{\mathrm{st}} $ Respondent and its secretary via letter dated 20-8-2021 for the supply of the Documents and/or Instruments but this was refused by letter dated 7-9- 2021. Another letter dated 13-9-2021 ensued, as well as to the new secretary but nothing was forthcoming. On 23-9-2021, the Respondents through their advocate maintained their refusal to provide. [8] This impasse ultimately led the Appellant to file the OS. Decision of the High Court [9] The Judicial Commissioner (JC) found that section 351 Companies Act 2016 (CA) is not applicable where there is no evidence the provision had been contravened. Fraudulent involvement had only been alleged but no certainty was shown. There is a prerequisite to show contravention. [10] It was further found that the documents required by the Appellant had been filed with CCM. As the documents have been lodged with CCM, the Appellant need only pay the prescribed fees to obtain the documents. The Appellant can inspect the documents under section 601 CA and get copies from CCM. If upon inspection, any particulars in any form or statement is false, the Appellant can apply to the Registrar to rectify under section 602 where such decision is appealable. [11] It was also stated that section 351 CA cannot be invoked where there are other alternatives where the Appellant can seek relief from. Submissions of the Appellant [12] It was submitted that the Documents and/or Instruments are not filed with CCM and not made available. On the contrary, these are mandated to be lodged with the $ 1^{\mathrm{st}} $ Respondent as provided under sections 105(1) and 208(2) CA. [13] It need not be shown that section 351 CA has been contravened. The provision gives wide discretion and power to the Court whether there is any contravention be it past, present or future. There were ample grounds for the discretion to be exercised where the Appellant's interests have been seriously affected as she has been deprived of her shares and directorship and the Respondent's conduct is subject to scrutiny and is required under CA to be maintained at the highest honesty and integrity. Submissions of the Respondents [14] It was submitted by the Respondents that the Documents and/or Instruments sought are for the Appellant's record only as may be seen in the reliefs sought and paragraph 7 of the affidavit in support that the documents are for record and inspection to ascertain the genuineness and justification of the resignation and transfer and to ensure compliance of the law (paragraph 11 of the affidavit in support). There was therefore no allegation or proof of contravention of the law such that section 351 CA cannot be invoked. [15] It was further submitted that section 351 CA is only invoked if a person has engaged, is engaged or intends to engage in a conduct which is a contravention of the Act. The prerequisite has therefore not been met. [16] All particulars and the necessary forms have been duly lodged to CCM and in fact shown in the exhibits "YAL-1" to "YAL-24" produced by the Appellant. The change of directorship and shareholder has also been lodged as per the Register of Member and Notification of Change in the Register of Directors, Managers and Secretaries. [17] The application was more towards seeking pre-action discovery under O24 r7A Rules of Court 2012. There is no nexus with section 351 CA. Our decision Application of section 351 CA [18] The application is grounded on section 351 CA which provides as follows: "Injunction

(1) Where a person has engaged, is engaging or intends to engage in conduct that constituted, constitutes or would constitute-

a contravention of this Act;

an attempt to contravene this Act;

an attempt that aids, abets, advises or procures a person to contravene this Act;

an attempt to induce, whether by threats, promises or otherwise, a person to contravene this Act;

an attempt by which any person would be in any way, directly or indirectly, knowingly concerned in, or party to, the contravention by a person of this Act; or

an attempt of conspiracy with others to contravene this Act, the Court may, on the application of the Registrar, or of a person whose interests have been, are or would be affected by the conduct, grant an injunction, on such terms as the Court thinks appropriate, restraining the first-mentioned person from engaging in the conduct and, if in the opinion of the Court it is desirable to do so, requiring that person to do any act or thing.

If a person refused or failed, is refusing or failing, to do an act or thing that the person is required by this Act to do, the Court may, on the application of the Registrar or any person whose interests have been, are or would be affected by the refusal or failure to do that act or thing, grant an injunction, on such terms as the Court thinks appropriate, requiring the person who refused or failed, is refusing or failing, to do that act or thing.

The power of the Court to grant an injunction to restrain a person from engaging in conduct may be exercised whether or not-

it appears to the Court that the person intends to engage again or to continue to engage, in conduct of that kind;

the person has previously engaged in conduct of that kind; or

there is an imminent danger of substantial damage to any person if such person engages in a conduct of that kind.

The power of the Court to grant an injunction requiring a person to do an act or thing may be exercised whether or not-

it appears to the Court that the person intends to refuse or fail again, or to continue to refuse or fail, to do that act or thing;

the person has previously refused or failed to do that act or thing; or

there is an imminent danger of substantial damage to any person if such person refuses or fails to do that act or thing. [19] We are of the considered opinion that there has been a contravention of the CA as alleged by the Appellant where the act of the Respondents falls within "has engaged" or "is engaging" in conduct; or in the words of the Appellant's counsel, past or present contravention. In the factual matrix of this appeal, the Appellant had sought the Documents and/or Instruments where she had no knowledge or recollection whether she had consented to her resignation or the transfer of her 25,000 shares. The Appellant has deposed that it is beyond her knowledge and/or not within her recollection that she had consented to and/or submitted any resignation as director and/or consented to the transfer of the 25,000 shares at or around the material time between May to June 2018. [20] This therefore has raised a serious question as to whether the documents pertaining to her resignation as director and transfer of shares, which have been submitted to the CCM, are indeed true. [21] This in turn concerns the application of sections 591 and 593 CA as follows: "False and misleading statements

(1) Every corporation which advertises, circulates or publishes any return report, certificate, financial statements or other document required by or for the purposes of this Act makes or authorizes the making of a statement false or misleading in any material particular knowing it to be false or misleading or intentionally omits or authorizes the omission or accession of any matter or thing which makes the document misleading in a material respect and every officer of the corporation who knowingly authorizes, directs or consents to the advertising, circulation or publication commits an offence, and shall, on conviction-

in the case of a corporation, be liable to a fine not exceeding three million ringgit; and

in the case of officer of the corporation, be liable to imprisonment for a term not exceeding ten years or a fine not exceeding three million ringgit or to both.

Every person who in any return, report, certificate, financial statement or other document required by or for the purposes of this Act—(a) makes or authorizes the making of a statement false or misleading in any material particular knowing it to be false; or (b) misleads or intentionally omits or authorizes the omission or accession of any matter or thing making the document misleading in a material respect, commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding three million ringgit or to both.

If a person at a meeting votes in favour of the making of a statement referred to in this section knowing it to be false, he shall be deemed to have authorized the making of that statement." "False report or statement to the Registrar

A person who makes or furnishes, or knowingly authorizes or permits the making or furnishing of, any false or misleading statement, information or report to the Registrar relating to-

the affairs of a corporation;

any matter or thing required by the Registrar for the implementation of this Act; or

the enforcement of this Act, commits an offence and shall, on conviction, be liable to imprisonment for a term not exceeding ten years or to a fine not exceeding three million ringgit or to both." [22] A perusal of the above sections would show that the Respondents are required to furnish true and accurate statements with regard to the $ 1^{\mathrm{st}} $ Respondent company. False and misleading statements as to the Appellant's resignation and transfer, amount to an offence. This therefore is the contravention of the law within the meaning of section 351(1) CA. [23] Reverting to the issue of the Appellant's interests, effectively she has been deprived of her rights as director and shareholder in the $ 1^{\mathrm{st}} $ Respondent, where she was previously a director and shareholder. Hence, the Documents and/or Instruments are required to verify their genuineness. [24] It has been held by this Court in Wong Kien Ching v Seng Kim Huat & Anor [2019] 7 CLJ 356 at page 366: [20] As was pointed out earlier, the respondents' application is pursuant to s. 368A(1)(a) and (4). Section 368A(1)(a) deals with a situation where a person is alleged either to have engaged or intends to engage in conduct that constituted constitutes or would constitute a contravention of this Act. In such a situation, the court is moved to grant an injunction requiring that person to do a particular act or thing. [21] What is important is that s. 368A(1) may only be invoked by the Registrar or by a person whose interests is either affected or would be affected by such conduct. It is therefore imperative that the applicants who are the respondents in this appeal, state how the conduct of the respondent to the application, that is, the appellant, affect their interests. Where and when that element has been established, the court is then in the position to impose such terms as are appropriate when granting the relevant injunction." Note: Section 368A Companies Act 1965 is pari materia with section 351 CA. [25] We therefore find that there is a contravention of sections 591 and 593 CA as alleged by the Appellant and section 351 can thus be invoked. The Appellant is a person whose interests have been affected by the refusal of the Respondents to provide the Documents and/or Instruments. [26] This is not a pre-action discovery for documents. Section 351 CA is wide enough to compel the Respondents to deliver the production of the Documents and/or Instruments. In Wong Kien Ching what was sought was an injunction to deliver documents in the form of certain subleases. The OS does indeed have a nexus with section 351. Whether the Documents and/or Instruments were lodged with CCM [27] The JC had found that the Documents and/or Instruments were lodged with CCM and all the Appellant had to do was to do apply for copies from CCM. We find that this was an error on a finding of fact which warrants our appellate intervention. [28] The Documents and/or Instruments sought are the original copies of her resignation as a director and all such documents signed by her and all the original instruments executed by her to transfer her 25,000 shares to the $ ^{3 rd} $ Respondent. From the Appellant's search in CCM and her purchase of all relevant documents from CCM's e-system, it will be apparent that these documents are not lodged with CCM. The documents available to her are in exhibits "YAL-1" to "YAL-24" enclosure 5. With reference to exhibit "YAL-29", enclosure 6/80, the Appellant has shown that the documents filed with CCM which are in the public domain and available to her are as follows: The rest of the page is intentionally left blank. All the documents are available in CTC (Certified True Copy) and Standard 22 SEP 2021 NO. Q180 TIMOTHY CHUA YAW SEN

01.06.2021 - 31.12.2023 NODOCUMENT TYPEDOCUMENT DESCRIPTIONDOCUMENT DATETOTAL PAGEPRICE16Declaration Of Compliance / S.14·Superform2015-10-251RM10211Notice Of Resolution2016-03-142RM10311Notice Of Resolution2015-12-012RM10424Return of allotment of shares / S.78·Return for allotment of shares2015-03-143RM10524Return of allotment of shares / S.78·Return for allotment of shares2015-10-27RM10644Registered office and Office hours / S.46·Notification for change in the registered address2015-12-01RM1044Registered office and Office hours / S.46·Notification for change in the registered address2015-10-272RM10849Register of directors, managers & Secretaries / S.58·Notification of change in the Register of Directors, Managers and Secretaries2018-06-122RM10949Register of directors, managers & Secretaries / S.58·Notification of change in the Register of Directors, Managers and Secretaries2017-01-263RM101049Register of directors, managers & Secretaries / S.58·Notification of change in the Register of Directors, Managers and Secretaries2018-10-273RM101149Register of directors, managers & Secretaries / S.58·Notification of change in the Register of Directors, Managers and Secretaries2015-12-013RM101253Notice Of Place Where Register2015-12-011RM1013102Memorandum And Articles Of Association / S.32·Lodgement of constitution2015-10-266RM1014146Sec 51/Notification of Change In The Register of Members2018-06-272RM1015461Statutory Declaration2017-01-262RM1016481Statutory Declaration2018-10-264RM1017481Statutory Declaration2015-12-012RM1018557Audited Financial Statement2019-12-3135RM1019557Audited Financial Statement2018-12-3135RM1020557Audited Financial Statement2017-12-3135RM1021558Exempt Private Company2018-12-314RM1022559Annual Return2020-10-2613RM1023559Annual Return2019-11-1913RM101559Annual Return2017-10-2610RM10 As shown above, the Documents and/or Instruments are not listed therein. "4.3 Furthermore, the documents requested by the Plaintiff had all been filed with the SSM i.e. the relinquishment of the directorship which was in June 2018 and this can be found in document No.8 dated 12.6.2018 Notification of change in the Register of Directors, Managers & Secretaries. As to the change of shareholding which occurred on the 27.6.2018, Item 14 of the document which is the requirement under the law that this document needs to be lodged in the change in the register of members under Section 51. Therefore, the documents have been lodged in SSM and the Plaintiff need only pay the prescribed fees to obtain the documents." [29] In paragraph 4.3 of the grounds, the JC stated as follows: [30] Document no. 8 referred to by the JC corresponds to exhibit "YAL- 4", enclosure 5. This shows the following: This only shows the change in directorship but is not the document sought namely the resignation signed by her as director. [31] Document no 14 referred to by the JC corresponds to exhibit "YAL- 3", enclosure 5. This shows the following: High Filtration NumberSharing NameAddressNumber of SharesTotal Shares Transferred InTotal Shares Transferred OutTotal Shares No. of SharesDriven in Transfer / Date of Consignment / Update of Profile530322-13-5345NGU UNG WOOLOT 145, JALAN SALIM,96000SIBUSARAWAKMALAYSIA025,000025,00026/06/2018850107-13-5206NANCY NGU CHIN CHINLOT 145,SALIM ROAD96000SIBUSARAWKMALAYSIA25,0000025,000670505-52-5726LINA YAP AI LINNO.170,LORONG4,JALAN ARANG,93250KUCHINGSARAWKMALAYSIA25,000025,000026/06/2018 This document pertains to the change in shareholding but is not the instrument sought namely the instrument executed to effect the transfer. [32] It was also said document no. 14 has to be lodged pursuant to section 51 CA. [33] In this regard, sections 51 and 58 CA provides a duty on the $ 1^{\mathrm{st}} $ Respondent company to notify the Registrar of particulars and changes in the register of members (section 51) and of director, manager and secretary (section 58). This was done as per above. But these are not the Documents and/or Instruments in question. [34] In fact, the Documents and/or Instruments are not lodged with CCM. This will be evident from sections 105(1) and 208(2) CA where such documents are lodged with the company itself. In this regard, those sections provide as follows: Requirement for instrument of transfer

(1) Subject to other written laws, any shareholder or debenture holder may transfer all or any of his shares or debentures in the company by a duly executed and stamped instrument of transfer and shall lodge the transfer with the company." "Vacation of office of director

(2) Subject to subsection 196(3) and section 209, a director may resign his office by giving a written notice to the company at its registered office." [35] The Documents and/or Instruments are not lodged with CCM such that it cannot be said the Appellant could access them by paying the prescribed fees. There is no other avenue for the Appellant to obtain the Documents and/or Instruments other than to seek them from the Respondents, failing which the OS was filed. Conclusion [36] For the above reasons, we find merits in the appeal. We allow the appeal and set aside the decision of the JC. We award costs of RM10,000.00 to the Appellant, subject to allocatur. Sinclair (SEE MEE CHUN) Judge Court of Appeal Malaysia Dated: 29-11-2022 Counsel for the Appellant: Wong King Wei (Teng Lee Kai with him) Messrs King Wei & Co. Kuching Counsel for the Respondent: Clement Wong Teck Hoo (Then Siaw Lian with him), Messrs Clement & Co.