Ong Yen Hoon v Mecco Technologies (M) Sdn. Bhd. (WA-24NCC-7-01/2026)

(M) Sdn. Bhd. (No. Syarikat: 199501005909 (335106-U)) ANTARA ONG YEN HOON (No. K/P: 650115-10-7452) …PLAINTIF DAN

MECCO TECHNOLOGIES (M) SDN. BHD. (No. Syarikat: 199501005909 (335106-U))

CHANG SOON SUNG (No. K/P: 630609-06-5151) …DEFENDAN-DEFENDAN GROUNDS OF JUDGMENT (Enclosures 6 and 59)

The Plaintiff (“Ong”) and 2nd Defendant (“Chang”) are spouses in the throes of a judicial separation. The 1st Defendant, Mecco Technologies (M) Sdn Bhd (“Company”) is their family company. They are the only shareholders and directors. Ong filed this Originating Summons (amended by consent in Enclosure 59) to seek remedies under section 346 of the Companies Act 2016 (“CA”). Background facts

The Company was incorporated on 28-2-1995 and is in the business of repair and maintenance of lifts, elevators and escalators. The shareholding and management structure of the Company is as follows: Shareholding Date of appointment as director Ong 186,200 (49%) 16-1-1996 Chang 193,000 (51%) 25-3-1995

The family has another company, Mecco V Sdn Bhd (“Mecco V”) which is the subject matter of a separate oppression action by the daughter of Ong and Chang, Mechelle Chang May Sye (“Mechelle”) in Kuala Lumpur High Court Originating Summons No: WA-24NCC-52-01/2026 (“Suit 52”). Suit 52 was transferred from NCC2 and heard together here.

The Company is fully operational with 17 employees who run the day-to-day operations, including Mechelle and her sister Chang May Ni. As between Ong and Chang, they remain the only directors on the Board of Directors.

It is fair to say that the events that led to this action are rooted in Ong filing for judicial separation on 18-9-2025 on grounds of adultery by Chang. Since October 2025, Chang has unilaterally issued a number of notices (“Notices”) while purporting to act in one or more of the following capacities, namely as founder, Managing Director and majority shareholder.

Broadly speaking, and for purposes of analyzing their nature and effect, the Notices may be categorized as follows: Financial Restriction Notices a) A notice dated 22-10-2025 addressed to all staff and directors of the Company prohibiting company fund disbursements online and requiring all payments and disbursements to be by cheque co-signed by Ong and Chang; b) A Memorandum dated 1-12-2025 to the Company by Chang, allocating RM5,000.00 in cash monthly to the Accounts Department for daily expenses and requiring all cash expenditures to be first approved by him; Operational Restriction Notices c) A Memorandum dated 1-12-2025 addressed to Chang’s daughter Mechelle who also works in the Company, instructing her to inform him of her daily work schedule and directing that all quotations must be approved by him before starting work; Winding Down Notice d) An undated company announcement from Chang on the scaling down of business due to his decision to retire, directing that the Company cease to take in new business with immediate effect, and that the company be formally wound down and discontinued once existing businesses and assignments are completed; Removal of Director Notice e) A requisition dated 2-1-2026 by Chang pursuant to section 311 of the CA to convene an EGM to remove Ong as a director.

The aforesaid actions prompted the filing of Enclosure 1 (now Enclosure 59) together with Enclosure 6, an application for an interim injunction to restrain any meeting of members to remove Ong as a director.

Ong takes the position that the Company is a quasi-partnership and that she accordingly has a legitimate expectation that Chang would not exercise his majority vote to make unilateral management decisions. Chang’s stand is simply that his actions as enumerated above are legitimate exercise of his powers as the Managing Director and majority shareholder. Analysis and findings

Section 346 of the CA is the statutory minority oppression provision. The jurisprudence in this area is well settled, and the determination of oppression claims is highly fact-sensitive. To invoke remedies under section 346 of the CA, a member must demonstrate the existence of one or both limbs of that provision: Limb (a) refers to the “conduct of the affairs of the company” or the exercise of the “powers of the directors” in a manner that is either oppressive “to one or more of the members” or in disregard of “his or their interests as members”; Limb (b) refers to “an act of the company” or a “resolution of the members” which either unfairly discriminates against or is otherwise prejudicial “to one or more of the members”.

The alleged acts of oppression are Chang’s issuance of the aforesaid Notices that, broadly speaking, are targeted at excluding Ong from her usual management functions as a director, the cessation of the Company’s business and the winding down of its operations without her consent as a director or shareholder. Cessation of business

On the facts of this case, this Court finds that the dispositive act of oppression is Chang’s unilateral decision, as a director and majority shareholder, to cease operations and wind down the business of the Company against the wishes of Ong as a 49% shareholder.

It fits the rubric of section 346 of the CA regardless whether or not Chang is a Managing Director as he contends and Ong disputes, or whether or not the Company is a quasi-partnership as Ong contends and Chang disputes. This is because where there are no provisions in the M&A of the Company on the pre-conditions or procedures for a members’ winding up, the CA applies.

According to section 432(1)(b) of the CA, a company may be wound up voluntarily if the company so resolves by special resolution. Section 292 defines a special resolution as one of which notice of not less than 21 days has been given and passed by a majority of not less than 75% of such members.

Thus, it is clear that a director acting alone, even one who is authorized as a Managing Director and holds 51% of the equity of a company, has no implied authority to initiate steps to cease carrying on business against the wishes of the minority shareholders, especially so if the company is a profitable going concern.

In this case, there is no dispute that the Company is a solvent and operational going concern. Based on the audited financial statement of the Company for the year ended 31-12-2024, the Company generated consistent earnings and was profitable. It also has property, plant and equipment.

In his affidavit, Chang attempted to retreat from the intent and purport of his Winding Down Notice by arguing that it was on account of the Company’s financial deterioration because of the actions he attributed to Ong and Mechelle, and Ong’s attempt to wrest control of the Company from him.

This Court did not find Chang’s assertions credible nor, in any event, did they justify the issuance of the Winding Down Notice whose explicit terms are as follows: “I, Chang Soon Sung (NRIC No.: 630609-06- 5151), in my capacity as the Majority Shareholder and Managing Director of Mecco Technologies (M) Sdn Bhd (“the Company”), hereby formally announce my decision to retire and, as a result thereof, to cease taking new businesses or projects from our clients. After careful consideration and many years of involvement in the management and operations of the Company, I have decided that it is in the best interests of all parties that the Company’s business operations be formally wound down and discontinued once the existing businesses and assignments are completed. Effective Date The cessation to take new order shall take effect immediately. Operational Matters With effect from the above date:

The Company shall cease accepting any new orders, including but not limited to trading, procurement, and service provision.

No new contracts, commitments, or financial obligations shall be entered into on behalf of the Company.

All departments are instructed to take the necessary steps to gradually wind down the businesses of the Company.

Outstanding matters, if any however, shall be completed accordingly. I would like to take this opportunity to express my sincere appreciation to all employees, partners, clients and stakeholders for their support, cooperation, and contributions throughout the years. This memo serves as formal notice of the Company’s decision to cease taking new orders or businesses and gradually wind down the operations due to my retirement and shall be effective forthwith unless otherwise notified in writing. Should there be any administrative or transitional matters requiring clarification, please don’t hesitate to contact me personally.”

Chang’s issuance of the aforesaid notice was premised solely on his stated intention to retire and not for any other reason. He thought that he was entitled to do so as the majority shareholder and Managing Director of the Company. The aforesaid notice was apparently circulated to third parties doing business with the Company.

By unilaterally taking steps to cease the Company's operations and wind down its business, Chang sought to circumvent the statutory process governing a voluntary winding up and the protections it affords shareholders. His conduct deprived Ong of a meaningful opportunity to participate in, oppose and ultimately veto any proposal for a voluntary winding up, thereby undermining her ability to realise the full value of her shareholding.

Thus, the Winding Down Notice and the related actions taken by Chang concerned the conduct of the affairs of the Company and have unfairly disregarded the rights and interests of Ong as a shareholder. Exclusion from management

A shareholder is not vested with management rights in a company. So, there is no general expectation that a shareholder will have a seat at the Board of Directors or otherwise participate in management.

Ong is both a director and shareholder, and her complaints about Chang’s unilateral issuance of the Notices without consulting her as a director-cum-shareholder are premised on her contention that the Company is a quasi-partnership under their joint management. She contends that she has a legitimate expectation to participate in all material decisions on the operations, finances and direction of the Company and that Chang’s powers as a director will not be exercised to prejudice her interest as a minority shareholder (“Expectation”).

In this case, the Notices were acts of Chang, and according to him, they ultimately fall within his legal powers as a majority shareholder. Based on partnership principles, shareholders in a quasi-partnership owe fiduciary duties to each other to act in good faith and this may make it unfair when one party conducts the affairs of the company relying on their strict legal powers.

As to what a quasi-partnership means in company law, this was explained in Ebrahimi v. Westbourne Galleries Ltd [1973] AC 360 (“Ebrahimi”) as follows: “Certainly the fact that a company is a small one, or a private company, is not enough. There are very many of these where the association is a purely commercial one, of which it can safely be said that the basis of association is adequately and exhaustively laid down in the articles. The superimposition of equitable considerations requires something more, which typically may include one, or probably more, of the following elements:

an association formed or continued on the basis of a personal relationship, involving mutual confidence - this element will often be found where a pre-existing partnership has been converted into a limited company;

(ii) an agreement, or understanding, that all, or some (for there may be "sleeping" members), of the shareholders shall participate in the conduct of the business;

(iii) restriction upon the transfer of the members' interest in the company - so that if confidence is lost, or one member is removed from management, he cannot take out his stake and go elsewhere.” [Emphasis added]

The law also recognises that a quasi-partnership relationship may be acquired after the formation of the company. Lord Wilberforce in Ebrahimi specifically refers to an association “formed or continued” on the basis of a personal relationship. See Strahan v Wilcock [2006] EWCA Civ 13 for an example of this.

Section 346 of the CA is engaged if the exercise of the power in question would be contrary to what the parties, by words or conduct, have agreed or understood before or after entering into the association (Pan-Pacific Construction Holdings Sdn Bhd v Ngiu-Kee Corporation (M) Sdn Bhd & Anor [2010] 6 CLJ 721).

To recap, this Court has found that absent any clear delegation of authority or authority that may be implied or ostensible, a director acting alone cannot bind a company and there is no implied authority of a Managing Director to issue the Winding Down Notice. As to whether the other Notices also constitute oppressive conduct and disregard of Ong’s rights as a member, this Court has, for completeness, also considered whether the Company is a quasi-partnership.

Per Tay Bok Choon v. Tahansan Sdn. Bhd. [1987] 1 MLJ 433, Lord Templeman sitting on the Privy Council, this Court must determine the question of whether the Company operated as a quasi-partnership based on the undisputed facts, and in this case they are as follows:

The Company has been a closed family company from the time Ong became a director and shareholder in 1996. There has been an unbroken period of 30 years during which Ong and Chang are the only directors and shareholders of the

Until the events that led to this action, there was a relationship of mutual trust and confidence between Ong and Chang as spouses, and it was not credibly disputed that both were involved in the management of the Company;

Specifically, the fact that the Financial Restriction Notice was issued implies that Ong was previously able to freely carry out financial transactions for the Company using the Company’s online banking facilities without oversight by

The audited financial statement of the Company for the year ended 31-12-2024 also reveals that the Company has banking facilities secured by pledge of bank deposits, charges over its factory and land and the joint and several guarantees by Ong and Chang as directors;

The only other people in the Company identified as employees in whom some management authority may be inferred are the 2 adult children of Ong and Chang – Chang May Ni and Mechelle – both of whom also work in the

Mechelle and Chang May Ni were involved in the operations of the Company in capacities that may be inferred from the following notices issued by Chang:

In a memo dated 19-12-2025 addressed to Mechelle, Chang had expressed shock to receive a notice dated 10-12-2025 that presumably violated the Notice prohibiting the taking on of new business;

(ii) In a warning dated 22-12-2025 addressed to Chang May Ni on the processing of cash expenditures without his approval, Chang directed his daughter to hand over all petty cash to the Account Assistant;

When the Notices were issued between October 2025 and January 2026, neither Ong nor Chang was in active operational management of the Company, nor had they been for an unknown period of time; and

There are no Board resolutions appointing Chang as Managing Director, prescribing limits on authority in relation to online banking, defining any pre-existing limits on the operational responsibilities of Ong, Mechelle or Chang May Ni, or otherwise imposing the formal governance strictures one would ordinarily expect in a company managed strictly according to its written constitution.

Based on the undisputed facts above, including Chang’s own conduct and complaint that his own exercise of shareholder management rights as a director are being curtailed by Ong and his children, this Court is satisfied that: a) The Company became, shortly after its formation, an association continued on the basis of a personal relationship involving mutual confidence; and b) There was an understanding between Ong and Chang based on that personal relationship, the risks jointly undertaken by them, assumption of operational responsibilities to the exclusion of outsiders and informal delegation of the same to their children, that both shareholders would mutually observe the Expectations as set out above.

The issuing of the Notices by Chang, in relation to which there is no credible dispute as to his intent, do, in this Court’s view, amount to steps to exclude Ong from the management of the Company and are therefore contrary to the said Expectations.

As noted, Chang has sought to justify his actions in issuing the Notices, the effect of which was to restrict Ong’s financial and operational management of the Company, directly or through the restriction of existing operational mandates enjoyed by Ong and the children. His justification is that Ong is misappropriating company funds and is attempting to wrest control of the Company from him.

The difficulty with Chang’s cross-allegations is that there is no counterclaim of oppression by Chang in this action. Even if one had been pleaded,it would not have justified Chang’s own actions. In any case, Ong’s alleged unauthorized withdrawals of company funds, specifically of the sum RM80,000.00 drawn by Ong on 8-12- 2025 which he demanded be returned, are matters for which the proper recourse is an action by the Company as the party aggrieved, against Ong. Chang denies the role of equity in this case and therefore, did not plead or argue unclean hands.

For the reasons set out above, this Court finds that a case under section 346(1) of the CA has been made out. In terms of remedies, section 346(2) of the CA empowers the Court to make such order as the Court thinks fit, with a view to bringing to an end or remedying the matters complained of.

To this end, the Court allows Enclosure 59 in part. The dispositive orders are as follows:

A declaration that the 2nd Defendant has exercised his powers as a majority shareholder and director of the Company in a manner oppressive, unfairly discriminatory and prejudicial to and/or in disregard of the interests of the Plaintiff as a minority shareholder;

(a) An order that a qualified independent accountant (“Valuer”) be appointed to carry out a valuation of the fair value of the shares of the Company;

Unless sooner agreed upon by the parties, the Valuer shall be selected by this Honourable Court upon the parties informing the court of their respective candidate (with confirmation of consent and willingness to act within the parameters of this Order, detailed profile and fee quote) by way of an affidavit to be filed within two (2) weeks from the date of this Order, whereupon the selected Valuer shall be immediately appointed;

The agreed upon or selected Valuer shall have instructions to carry out a valuation of the fair value of the shares of the Company as at the date of this Order; and prepare a valuation report within two (2) months from the date of the appointment; and

The method of valuation, assumptions, and final valuation of said Valuer shall be final, conclusive and binding on the parties.

An order that the Valuer shall have unrestricted access to all the books, records and financial information of the Company wherever maintained and in whatever form and with whomsoever, including the Company’s accountant, at any time and from time to time during the period of valuation, and further that the Plaintiff shall provide an account of the RM80,000.00 drawn by her on 8-12-2025 for the purposes of the valuation;

An order that the costs of a forensic auditor, real estate valuer and the Valuer shall be borne by the 1st Defendant;

An order that the Plaintiff be ordered to purchase and make payment of the full purchase price for the 2nd Defendant’s shares in the Company at the price ascertained by the Valuer within fourteen (14) days from the date of such determination;

Upon receipt of full payment for the shares from the Plaintiff as aforesaid in paragraph (5) above, the 2nd Defendant shall execute all transfer documents necessary to transfer the shares to the Plaintiff;

Pending the completion of the sale and transfer of shares, both the Plaintiff and 2nd Defendant are restrained from exercising their powers as directors and shareholders otherwise than (a) to transact the ordinary business of the Company (b) to effect the orders in this Judgment or (c) by mutual consent;

The parties shall have liberty to apply; and

Costs of RM20,000.00 be paid by the 2nd Defendant to the Plaintiff.

All other orders prayed for in Enclosure 59 are disallowed. Enclosure 6 is rendered academic and struck off. Bertarikh: 26.06.2026 ELAINE YAP CHIN GAIK PESURUHJAYA KEHAKIMAN MAHKAMAH TINGGI MALAYA KUALA LUMPUR Peguam Untuk Plaintif: Khoo Ai Theng (Tan Hock Ann bersamanya) Tetuan Ng, Zainurul, Seke & Khoo Untuk Defendan Kedua: Ho Yuk Yuen (Nai Mei Kei dan Alissa Loh bersamanya)