New Ru Eng v Lew Chee Hwa (JB-29PB-290-08/2023)

This is an appeal against the decision of the learned Senior Registrar (SAR) on 22.10.2023.

The appeal is by the Judgement Creditor in respect of the decision allowing the Judgement Debtor’s application to annul the Bankruptcy Order under Section 105 of the Insolvency Act 1967. February 1, 2024 2

On 30.11.2021, the Judgement Creditor obtained a Bankruptcy Order against the Judgement Debtor based on a Judgement in Default obtained in a Civil Suit.

The Bankruptcy Order was subsequently amended by the Judgement Creditor on 5.1.2022.

Thereafter the Judgement in Default was successfully set aside by the Judgement Debtor on 11.10.2022.

This led to the filing of the application by the Judgement Debtor to annul the Bankruptcy Order under Section 105 of the Insolvency Act, 1967.

The learned SAR allowed the Judgement Debtor’s application.

The Judgement Creditor being dissatisfied with the decision appeals before me.

It is trite law that an Appeal to Judge in Chambers is by way of a rehearing. Please see Seloga Jaya Sdn Bhd v Pembenaan Keng Ting (Sabah) Sdn Bhd [1994] 2 MLJ 97.

The Judgement Creditor raised two grounds to oppose the Judgement Debtor’s application before the SAR. February 1, 2024 3

The first ground is that the Notice of Application filed by the Judgement Debtor is the wrong mode of application. The Judgement Creditor submits that the correct mode is by way of a Summons in Chambers.

The other ground relied on by the Judgement Creditor is that the application made by the Judgement Debtor is out of time.

The learned SAR found no merits in both these grounds and dismissed the Judgement Creditor’s objection.

However, before me at the hearing of this appeal, learned counsel for the Judgement Creditor relies only on the first ground of objection which concerns the correct mode of application under Section 105 of the Insolvency Act, 1967.

In this circumstance, my judgement will be confined to this issue only.

The Judgement Creditor submits that under Rule 17 of the Insolvency Rules 2017, the application by the Judgement Debtor to annul the Bankruptcy Order must be made by way of a Summons in Chambers. Rule 17 read:- “17 Applications to be made by summons in chambers Except where these Rules or the Act otherwise provide, every application to the court shall, unless the Chief Judge otherwise directs, be made by summons in chambers supported by affidavit.” February 1, 2024 4

In support of this submission, learned counsel for the Judgement Creditor relies on the following authorities: -

Bungsar Hill Holdings Sdn Bhd v Dr Amir Farid Datuk Isahak [2005] MLJU 671;

(ii) Hong Leong Bank Bhd (previously known as Credit Corp (M) Bhd) v Sheikh Ahmad Marzuki bin Sheikh Yusof [2015] 2 MLJ

[18] In Bungsar Hill Holdings Sdn Bhd (supra) and Hong Leong Bank Bhd (supra), the Judgement Debtor filed a Summons in Chambers to set aside and rescind the Receiving and Adjudicating Order entered against the respective Judgement Debtors. [19] In addition to the above two cases, the Judgement Creditor also relies on the Court of Appeal’s decision in Soo Kok Loong v Hong Kong & Shanghai Banking Corporation Limited [2009] MLJU 517 which concerns an application made by way of Summons in Chambers to annul and or rescind the AO RO under Section 105 of the Bankruptcy Act, 1967. [20] Whereas the Judgement Debtor places reliance on Rule 139 of the Insolvency Rules 1967 in making the application by way of a Notice of Application. According to Judgement Debtor, the heading of this Rule itself refers to Notice of Application. Rule 139 read:- “139 Notice of application to annul bankruptcy order and stay proceeding February 1, 2024 5

An application to the court to annul a bankruptcy order or to stay proceedings, shall not be heard except upon proof that notice of the intended application, and a copy of the affidavit in support thereof, have been duly served upon the Director General of Insolvency.

Unless the court gives leave to the contrary, notice of any such application shall be served on the Director General of Insolvency not less than fourteen days before the day named in the notice for hearing the application.

Pending the hearing of the application, the court may make an interim order staying such of the proceedings as it thinks fit.” [21] According to the Judgement Debtor, the general heading to Rule 139 can be used as an aid to interpret this rule. In support of this submission, reliance is placed on the case of Badan Peguam Malaysia v Louis Edward Van Buerle [2005] 4 CLJ 469 wherein the Court of Appeal speaking through James Foong (JCA) (as he then was) held:- “Though marginal note can be used as a guide but one must not forget that it is only a sub-signpost in the LPA. There is a main sign in the form of a general heading. Similar to marginal note, this general heading, which is the overall signpost, can also be called on to assist in the interpretation of a statute.” February 1, 2024 6 [22] Whereas in respect of the 3 cases relied on by the Judgement Creditor, the Judgement Debtor submits that they are not applicable and binding as it did not refer to Rule 139 of the Insolvency Rules, 2017 which concerns an application to annul a Bankruptcy Order under Section 105 Insolvency Act 1967. [23] According to learned counsel for the Judgement Debtor, the above 3 cases did not deal with the issue of whether an application under Section 105 is to be made by way of a Notice of Application or Summons in Chambers. [24] In my judgement, the 3 cases relied on by learned counsel for the Judgement Debtor are not much of assistance. [25] Rule 17 of the Insolvency Rules 2017 states except where the Rules or the Act otherwise provide, every application to the Court shall, unless the Chief Judge directs be made by summons in chambers supported by affidavit. [26] In my opinion, the wording “where the Rules otherwise provide” allows an application to annul a Bankruptcy Order to be made by way of a Notice of Application. [27] This is because Rule 139 of the Insolvency Rules 2017 which concerns an application to annul a Bankruptcy Order in its heading itself refers to a Notice of Application. [28] Next, Form 53 which is the prescribed form under the Insolvency Rules 2017 for an application to annul a Bankruptcy Order under February 1, 2024 7 Section 105 also refers to the word “Application” and not to a “Summons”. For easy reference, Form 53 is reproduced below: - No. 53 (Title as in action) APPLICATION TO ANNUL BANKRUPTCY ORDER UNDER SECTION 105 (r. 139) I, ............................, of ........................... being interested in this matter, do hereby make application to the court that the bankruptcy order against........................... be annulled (here state ground of application). Dated this …………… day of ……..……., 20……..……. ........................... Signature [29] In the circumstance, I find the learned SAR had correctly concluded that Rule 139 read together with Form 53 is an exception to Rule 17 which requires every application to be made by way of a Summons in Chambers. [30] In addition to the above, Section 2 of the Insolvency Act of 1967 interprets general rules to include forms. In this circumstance, Form 53 fortifies the requirement in Rule 139 that the mode to annul a Bankruptcy Order is by way of a Notice of Application. [31] Lastly, the decision by the Court of Appeal in Azman bin Jufri v Medtronic Australasia Pty Ltd [2015] 6 MLJ 841 relied on by the Judgement Credit to support their contention that the former Rule 18 of the Bankruptcy Rules 1969 which requires an application to be filed by way of summons in chambers can be distinguished on February 1, 2024 8 the facts because the application therein relates to an Order for substituted service and not to annul a Bankruptcy Order. DECISION [32] In the foregoing, I find no merits in the Judgement Creditors Appeal. [33] The Judgement Creditor’s Appeal is therefore dismissed with cost. Dated this 1st February 2024 at Muar in the State of Johore. t.t. SURIA KUMAR DJ PAUL Judicial Commissioner High Court of Malaya Muar Johore Darul Ta’zim Counsels: For the Judgment Creditor : Andrew Tan Meng Kuan For the Judgment Debtor : Tan Chee Giap with Koh Pei Ying Solicitors: For the Judgment Creditor Messrs Alan Tan & Associates February 1, 2024 9 Advocates & Solicitors No. 47-6A & 47-7A Jalan Puteri 83000 Batu Pahat Johor [Ref. No. : 20286-AL-AL-BR-NERUEN] For the Judgment Debtor Messrs Soh Yok Lam & Co. Advocates & Solicitors No. 23, Ground Floor Jalan Majidi 84000 Muar Johor [Ref. No. : TCG/OR/4636/23/PY] Hearing Date : 4th January 2024 Decision Date : 1st February 2024