New VILL Intl Ltd v LIM Cheng Guan Dato (CA-22NCC-12-11/2025)

CA-22NCC-12-11/2025 IN THE HIGH COURT OF MALAYA AT KUANTAN IN THE STATES OF PAHANG, MALAYSIA CIVIL SUIT NO: CA-22NCC-12-11/2025 BETWEEN NEW VILL INT LTD [Company No. 07668794] ...PLAINTIFF AND LIM CHENG GUAN (NRIC NO. 7710016025639 ... DEFENDANT GROUNDS OF JUDGMENT Introduction [1] This was the Defendant's application vide Enclosure 6 dated 24.12.2025 seeking, inter alia, an order striking out the Plaintiff's Writ and Statement of Claim pursuant to Order 18 rule 19(1)(a), (b) and (d) of the Rules of Court 2012 ("ROC 2012"), alternatively pursuant to the Court's inherent jurisdiction under Order 92 rule 4 ROC 2012. [2] The Defendant contended that the Plaintiff's claim disclosed no reasonable cause of action against him personally, was frivolous and vexatious and constituted an abuse of the process of the Court. [3] After hearing learned counsel for both parties and considering the affidavits, exhibits and written submissions filed, I dismissed Enclosure 6 on 21.4.2026 with costs of RM10,000.00 subject to allocator. [4] These are my grounds. Background [5] The Plaintiff's claim concerns an alleged indebtedness in the sum of USD1,010,000.00 arising from business transactions involving Ironco Mining Sdn Bhd ("Ironco"). [6] It is not disputed that the transactions giving rise to the alleged debt were carried out between the Plaintiff and Ironco. [7] At all material times, the Defendant was the sole director and sole shareholder of Ironco. [8] The Plaintiff's claim is founded principally upon a Statutory Declaration dated 10.11.2023 executed by the Defendant, which, according to the Plaintiff, acknowledged the indebtedness and provided for a repayment arrangement. [9] The Defendant's position is that any debt owed was solely the debt of Ironco and that he never assumed personal liability for the company's obligations. He further contends that the Statutory Declaration merely acknowledged the company's indebtedness and did not constitute a personal guarantee or personal undertaking on his part. [10] The Plaintiff, on the other hand, contends that the Statutory Declaration, when viewed together with the surrounding circumstances, subsequent payments and representations allegedly made by the Defendant, gives rise to personal liability against the Defendant. Issue For Determination [11] The principal issue before the Court is whether the Plaintiff's action is so plainly and obviously unsustainable that it ought to be struck out summarily under Order 18 rule 19 ROC 2012. [12] It is important to emphasise at the outset that the present application is not concerned with determining whether the Plaintiff will ultimately succeed at trial. [13] Neither is the Court required at this stage to decide whether the Statutory Declaration constitutes a personal guarantee, whether the Defendant is in fact personally liable or whether the Plaintiff will ultimately establish any recognised exception to the principle of separate corporate personality. [14] The sole question is whether the Plaintiff's claim is so hopeless on its face that it ought to be terminated without the benefit of a full trial. Applicable Principles [15] The principles governing an application under Order 18 rule 19 are well settled. [16] In Bandar Builder Sdn Bhd & Ors v United Malayan Banking Corporation Bhd [1993] 3 MLJ 36, the Supreme Court emphasised that the jurisdiction to strike out is a drastic one which should be exercised only in plain and obvious cases. [17] The Court held that a pleading ought not to be struck out unless it is clearly unsustainable and incapable of succeeding even if the pleaded facts are assumed to be true. [18] The same principle was reaffirmed by the Court of Appeal in Sivarasa Rasiah & Ors v Che Hamzah Che Ismail & Ors [2012] 1 MLJ 473 where it was held that the degree of unsustainability must appear on the face of the claim itself without the need for a detailed examination of disputed facts. [19] It follows that the Court should be slow to strike out proceedings where the dispute turns on contested factual matters, the interpretation of documents in their factual context, the parties' intentions or issues requiring the assessment of credibility. [20] The Court must also guard against transforming a striking-out application into a premature trial of the action itself. The Defendant's Contention [21] The Defendant advanced four principal arguments in support of the application. [22] First, the Defendant contended that the debt pleaded by the Plaintiff was indisputably a debt owed by Ironco and not by the Defendant personally. [23] Secondly, the Defendant submitted that the Plaintiff had failed to plead any facts capable of justifying the lifting or piercing of the corporate veil. [24] Thirdly, the Defendant argued that allegations relating to personal guarantees, misrepresentation, fraud and personal undertakings were never pleaded in the Statement of Claim and were introduced only through affidavit evidence filed in opposition to the present application. [25] Fourthly, the Defendant submitted that because Ironco had already been wound up, any claim relating to the debt should properly be pursued through the insolvency regime and not through a personal action against the Defendant. [26] The Defendant further argued that the failure to join Ironco as a party was fatal to the Plaintiff's claim. Analysis Whether the Plaintiff's Claim is Plainly and Obviously Unsustainable [27] Having considered the parties' respective positions, I am unable to conclude that the Plaintiff's claim is plainly and obviously unsustainable. [28] It must be borne in mind that the Defendant's application is not an application for summary judgment. Neither is it a trial on affidavit evidence. [29] The Court is not presently concerned with determining which party's version of events is ultimately to be preferred. [30] Rather, the Court is concerned only with whether the Plaintiff's claim is so hopeless that it should be terminated summarily. [31] In my judgment, the Defendant's submissions identify a number of difficulties which the Plaintiff may ultimately face at trial. [32] However, identifying weaknesses in a claim is not synonymous with establishing that the claim is plainly and obviously unsustainable. The distinction is fundamental. The Statutory Declaration and the Alleged Personal Liability [33] The Plaintiff relies substantially upon the Statutory Declaration dated 10.11.2023 executed by the Defendant. [34] The Defendant submits that the document merely acknowledges a corporate debt and does not contain any express personal guarantee. There is force in that submission. [35] On a plain reading of the document as presently described by the parties, the Defendant's contention that the debt was acknowledged as a debt of Ironco cannot be dismissed lightly. [36] Nevertheless, the Court is not presently required to determine the ultimate legal effect of the Statutory Declaration. [37] The Plaintiff's case is not confined solely to the wording of the document itself. [38] The Plaintiff also relies on the surrounding circumstances, the alleged course of dealings between the parties, subsequent payments said to have been made pursuant to the repayment arrangement and representations allegedly made by the Defendant concerning repayment of the debt. [39] Whether those matters are capable of establishing personal liability, whether contractual, equitable or otherwise, cannot fairly be determined on affidavit evidence alone. [40] Such questions inevitably involve issues of intention, context and credibility. [41] These are matters which ordinarily require oral evidence and cross-examination. [42] Once the Court is required to investigate such matters in order to determine the viability of the Plaintiff's case, it becomes difficult to characterise the claim as one that is plainly and obviously hopeless. The Pleading Objection [43] The Defendant placed considerable emphasis on the proposition that allegations relating to personal guarantees, fraud, misrepresentation and the lifting of the corporate veil were either inadequately pleaded or not pleaded at all. [44] In my view, this represents the strongest aspect of the Defendant's application. [45] I accept the general proposition that parties are bound by their pleadings. I also accept that affidavit evidence cannot ordinarily be used to create an entirely new cause of action which is absent from the pleadings. [46] However, the present application seeks the striking out of the entire action. [47] The question is therefore not whether the Plaintiff's pleadings are perfect. The question is whether any alleged deficiencies are so fundamental that the Plaintiff's claim is beyond redemption and incapable of being cured. I am unable to reach such a conclusion. [48] Even assuming that aspects of the Plaintiff's pleadings may lack precision or sufficient particularity, that does not necessarily render the entire action unsustainable. [49] In Shahidan Shafie v Atlan Holdings Bhd & Anor & Other Appeals [2005] 3 CLJ 793, the Court of Appeal recognised that where a pleading is capable of being cured by amendment, striking out should not ordinarily be the preferred course. [50] In the present case, I am not persuaded that any alleged pleading deficiencies are incapable of cure through amendment. [51] Nor am I satisfied that the defects alleged by the Defendant are of such a nature that they justify terminating the action at this preliminary stage. The Corporate Veil Argument [52] The Defendant further submits that the Plaintiff has failed to plead facts capable of justifying the lifting or piercing of the corporate veil. [53] Whether the Plaintiff can ultimately establish any recognised exception to the principle of separate corporate personality is a matter that remains to be determined. [54] The Court is not presently required to decide whether the Plaintiff will succeed on that issue. The Court is only required to determine whether the Plaintiff's attempt to impose personal liability upon the Defendant is so hopeless that it should be denied a trial altogether. [55] Having regard to the factual disputes identified above, I am unable to say that it is. The Insolvency and Non-Joinder Arguments [56] I am likewise unable to accept the Defendant's submission that the winding up of Ironco necessarily renders the present action unsustainable. [57] The Plaintiff's claim, rightly or wrongly, is directed against the Defendant personally. [58] The mere existence of insolvency proceedings involving Ironco does not automatically extinguish any independent cause of action that may be asserted against another person. [59] Whether the Plaintiff can ultimately establish such liability is a matter for trial. [60] Similarly, I do not consider the alleged non-joinder of Ironco to be fatal at this stage. [61] Questions relating to joinder are procedural matters for which the Rules of Court provide appropriate remedies. They do not, without more, justify the striking out of an entire action. Conclusion And Decision [62] Having considered the matter in its entirety, I am not persuaded that the Plaintiff's claim is plainly and obviously unsustainable. [63] The dispute raises genuine questions concerning the legal effect of the Statutory Declaration, the parties' intentions, the significance of the alleged representations, and whether the Defendant assumed any form of personal liability. [64] Those issues are not amenable to summary determination on affidavit evidence alone. [65] At its highest, the Defendant's submissions expose arguable weaknesses and potential deficiencies in the Plaintiff's case. However, arguable weaknesses are not the test under Order 18 rule 19. [66] The test is whether the claim is so clearly hopeless that it ought to be terminated without a trial. [67] Applying the principles set out in Bandar Builder and Sivarasa Rasiah, I am unable to conclude that the Plaintiff's claim meets that description. [68] This Court therefore finds that the Plaintiff's action ought to proceed to trial where the disputed factual issues can be properly ventilated and determined upon the full evidence. [69] Accordingly, Enclosure 6 was dismissed with costs of RM10,000.00 subject to allocator. Dated: 8 June 2026 (SAMRY BIN MASRI) Judicial Commisioner High Court Kuantan Counsel for the Plaintiff : Tetuan Ander Ang, Atikah & Associates Peguam Bela & Peguam Cara C2-5-3A, Solaris Dutamas Jalan Dutamas 1 50480 Kuala Lumpur (Ruj: AAA/CN/L010/2025) Counsel for the : Tetuan Kumera & Co Defendant Peguam Bela & Peguam Cara A11, 1 $ ^{st} $ Floor, Lorong Tun Ismail 12 Sri Dagangan 2 25020 Kuantan Pahang Darul Makmur (Ruj: K/L/0053/25)