Liow Keng Luan v Health Resources Sdn Bhd (WA-12ANCvC-170-09/2024)

The Defendant appeal to this Court is against the decision of the learned Session Judge who had dismissed the Defendant’s application for a stay proceedings in the Sessions court until the disposal of a family dispute in the Family High Court Kuala Lumpur.

This appeal is made under order 55 Rule 1 of the Rules of Court 2012 (“the Rules’) which stipulates: Notice of Appeal against any decision other than a decision made after trial (O. 55 r. 5) An appeal from any decision other than a decision made after trial by the Subordinate Court shall lie to a Judge in Chambers of the High Court. Brief facts

The Plaintiff is a registered company under the Companies act 2016 whereas the Defendant was one of the Directors of the Plaintiff in charge of finance.

The Plaintiff discovered that there were discrepancies in its accounts and suspected misappropriation of certain sums of monies by the Defendant.

The Defendant had applied for a stay as the Plaintiff was a family company set up together with her husband. The Defendant contended that the funds of the company were permitted to be used for the benefit of the family.

In April 2023 on the ground of her husband’s adultery the Defendant commenced a Judicial separation proceedings in the Family High Court Kuala Lumpur. The Defendant contend that the Plaintiff Company is a part of matrimonial asset and therefore matters related to it is best determined by the High Court.

In the proceeding in the High Court one of the issue is the application of the funds of the Plaintiff Company. To avoid duplicity of the determination of the issue on the use of the Plaintiff’s funds the Defendant applied for the stay in the Sessions court. The decision of the learned Sessions Judge 8. The learned Sessions Judge found that the cause of action in the Sessions Court differed from the cause of action in the High Court, rendering evidence to be adduced in the High Court to be irrelevant for the determination of the cause of action in the Sessions Court. The decision of this Court 9. It is clear under the Companies Act 2016 that an incorporated company had a separate legal entity from its members. The personal relationship between the directors have no bearing in the affairs of the company. The company is governed by the company law in its functioning. The personal spat between the Defendant and her husband has no bearing on the Plaintiff’s claim.

The Court also notes that in the claim in the High Court there are various family companies involved. The functioning of this family companies have no bearing on the affairs of the Plaintiff which is distinct entity.

The cause of action in this case is premised on breach of fiduciary duties against the Plaintiff by the Defendant. The Defendant’s personal dispute with her husband are not related to matters in involving her duties toward the Plaintiff. Conclusion 12. In the upshot the Court dismissed the Defendant’s appeal with a cost of RM3, 000. Dated: 7.1.2025 sgd DATO’ HAJI AKHTAR BIN TAHIR Judge High Court of Malaya, Kuala Lumpur PARTIES For the Appellant: Nama Peguamcara: Onnelea Dion Sandosam, Foo Wet Ngo, Kiran Dhaliwal Tetuan Y N Foo & Partners H-2-12, Block H, Plaza Damas, Jalan Sri Hartamas 1, 50480 Kuala Lumpur. For the Respondent: Nama Peguamcara: Eileen Ooi Chia Ling Tetuan Joseph Ting & Co Suite 5-14, 6th Floor, IOI Buisness Park, No.1, Persiaran Puchong Jaya Selatan, Bandar Puchong Jaya, 47170 Selangor.