Queck Han Tiong v Chia Chin Koon (WA-22NCC-646-09/2024)

P the return of 600,000 shares shares in Kujaya company . Namely:- (i) 480,000 shares from the 1st D1 ii) 120,000 shares from the 2nd Defendant D2

seeking a retransfer of the shares for total failure of consideration. After a full trial, I . Here are the grounds of my judgment. Background facts

On 25.11.2020, P became a shareholder of the company, holding one million ordinary shares in the company. The share certificate no. 009 for the said one million ordinary shares was issued to P under his name. On 8.9.2021, P transferred 480,000 shares to D1 and 120,000 shares to D2.

At the time of the aforementioned transfer of the shares, there was a proposal to merge the RP group of companies and the Kujaya group of companies, including the company, to be listed on the Taipei stock e listing proposal . Sometime around December 2023, it became apparent that the listing proposal could not materialise.

.7.2024, P terminated the transaction with the Defendants for total failure of consideration. P demanded a retransfer of the shares. The D

12.8.2024, refused. Hence, this action. The case

P claims for the return of the shares from the Defendants on the ground of total failure of consideration. According to P, it was agreed between the parties that the purchase price of the shares is RM 9 million. It was further agreed between the parties that the payment of the consideration for the shares shall be deferred until after the successful implementation of the listing proposal.

Sometime around December 2023, it was confirmed that the listing proposal could not happen. P claims that the deferment for payment of the consideration for the shares has been cancelled. To date, P has not received the consideration for the shares. Hence, P commenced this action to claim the return of the shares from the Defendants. The case

T is this. On 8.9.2021, the Defendants agreed to purchase and one Neo Ching Yuen ( DW3 ) agreed to sell the shares to the Defendants. The Defendants have paid the consideration for the shares to DW3. The Defendants were told by DW3 that he is the beneficial owner of the s . P was merely holding the shares on trust for NCY.

On 8.9.2021, P acted upon the instruction of DW3 and executed the transfer of the shares to the Defendants. Namely:- (i) 480,000 shares to D1; and (ii) 120,000 shares to D2. From 8.9.2021 (the date of the transfer of the shares by P to the Defendants) until June 2024, P never requested the purported consideration for the shares, or for the retransfer of the shares. The inaction of P for almost three years indicates that he is not the beneficial owner of the shares, and was holding the shares as a trustee for DW3. Issues to be tried

The agreed issue to be tried is this :

(a) Whether the Defendants have paid any consideration for the transfer of the shares from P to them on or about 8.9.2021?

The Defendants posed further issues to be tried as follows :

(a) Whether P held the 480,000 shares and the 120,000 shares, which he transferred to D1 and D2 respectively on 8.9.2021, as a trustee for DW3?

(b) Whether P is estopped by his own conduct in challenging the transfer of the shares approximately three years after the transfer of the shares?

My findings are as follows :

(a) the Defendants have not paid any consideration for the transfer of the shares from P to them;

(b) P did not hold the 480,000 shares and the 120,000 shares, which he transferred to D1 and D2 respectively on 8.9.2021, as a trustee for DW3; and

(c) P is not estopped by his conduct from challenging the transfer of the shares.

Here are my reasons. First issue - No consideration was paid by the Defendants to the Plaintiff for the shares

It is not in dispute that :

(a) the shares were part of the one million shares of the company obtained by P by way of new allotment at RM 1 per share on 25.11.2020;

(b) P paid the sum of RM 1 million directly to the company for the said allotment, which constituted 50 % of the total issued shares of the company;

(c) the shares were transferred by P to D1 and D2 respectively on 8.9.2021; and

(d) P did not receive any payment for the shares from the Defendants.

When there is a total failure of consideration, as in this case, P is entitled to claim restitution of the shares transferred. The cause of action lies in restitution and unjust enrichment.

In Kong Hoi Cheing v AK Land Sdn Bhd [2021] 6 MLJ 725 at 744 - 746, where the facts were quite similar to the facts of the present case, the Court of Appeal said : In the statement of claim, the plaintiff prays for the first defendant to transfer the shares in second defendant and Sabalight Sdn Bhd back to the plaintiff or his nominees. ... [45] plaintiff had not received consideration for the shares the MOU and that the shares were being held by the defendants. [46] During the trial, it was not disputed that the plaintiff had transferred the shares to the defendants pursuant to the MOU. The plaintiff had transferred 400,000 shares in the second defendant and 250,000 shares in Sabalight Sdn Bhd to the defendants. [47] We are also of the view that the defendants did not plead that it had paid for any of the shares in the second defendant. This was further borne out by the fact that the shares in the second defendant and Sabalight Sdn Bhd were 1 showed that no payment was made by the defendants. [49] Since the shares were transferred to the defendants pursuant to the MOU and there was a total failure of consideration for the shares due to the first defendants had been enriched with the shares in the first defendant and Sabalight Sdn Bhd and the retention of the shares in the first defendant and Sabalight Sdn Bhd is therefore unjust. [51] We also note in Dream Property Sdn Bhd v Atlas Housing Sdn Bhd the defendant was claiming unjust enrichment against the plaintiff and the Federal Court held that : a cause of action in unjust enrichment can give rise to a right to restitution where it can be established that :

(a) the plaintiff must have been enriched;

(b)

(c) that the retention of the benefit by the plaintiff was unjust and;

(d) there must be no defence available to extinguish or reduce the [52] The Federal Court also recognised that the law of unjust enrichment can apply to rights of parties to a contract which has been validly terminated. It further is that it is founded on the law of unjust enrichment which fell outside the domains of contract and tort. The law of contract / tort and the law of unjust enrichment are conceptually distinct . [53] We are of the considered view that the pleadings are sufficient for claiming defendant and Sabalight Sdn Bhd. The plaintiff had pleaded that the plaintiff had not received co

The fact that no consideration was paid by the Defendants to P for the shares is admitted by them. Q & A 7 of their respective witness statements reads : Q7: Can you confirm that there is no consideration paid to the Plaintiff for the transfer of 480,000 units of shares in the Company? A7: Yes, I confirm that. Because I was represented by NCY that the Plaintiff is merely a trustee for the 480,000 units of shares in the Company.

The sole defence put forward by the Defendants is that DW3, who is their business partner in a group of companies called the RP group, had represented to them that P held the shares as a trustee for him. They had purchased the shares from DW3, the alleged beneficial owner, and paid him RM 600,000 for the shares. Incidentally, DW3 is the brother of D2. The law on legal title of shares, trust and beneficial ownership

Since it is not in dispute that P was the registered owner of the shares and had paid for the allotment of the shares with his own money from his own bank account, prima facie, he was also the beneficial owner of the shares.

Section 101 (1) of the Companies Act 2016 reads - evidence to the contrary, the entry of the name of a person in the register of members as shareholder is prima facie evidence that legal title to the

e that will establish a fact or . (See , 11th Edition, page 701).

The burden of proof therefore lies on the Defendants to prove their allegation that P held the shares on trust for DW3, and that they had paid DW3 for the shares. (See section 101(2) and section 102 of the Evidence Act 1950).

In order for a valid trust to exist, three requirements must be fulfilled. of subject matter: both in terms of the corpus and the beneficial interest. Third, there must be certainty of the objects of the trust. A trust is void if (See the Court of Appeal cases of Fawziah Holdings Sdn Bhd v Metramac Corporation Sdn Bhd & another appeal [2006] 1 CLJ 996 at 1024; Ong Kong Beng & Anor v Ong Kong Leong & Ors [2022] MLJU 482 at paragraph [154]).

The legal and beneficial ownership of the shares is a question of fact and evidence. In the present case, there is no evidence to support the D . Therefore, based on the admitted facts, there has been a total failure of consideration on the part of the Defendants. Analysis of the evidence

P is a professional engineer and experienced in housing development and construction contract. He has invested in various , including shares in public listed companies. He is a director of several private limited companies.

The company is involved in the provision of foreign workers. It was founded by one Datuk Wan Kian Han Datuk Wan and his wife. At the material time in the year 2020, the company 1 million consisting of one million shares of RM 1 each. Datuk Wan and his wife owned 50 % each.

The Defendants and DW3 are business partners in a group of companies called the RP group. There was a plan by the RP group to list its shares in Taipei. In furtherance of the listing proposal, they planned to merge the shares of one RP Manpro Group (Cayman) Ltd RP Manpro with the shares of the company.

P and DW3 are both residents of the same condominium called Baystar. When asked additional questions during examination in chief, P said that he was informed by DW3 of the listing proposal and the opportunity to invest. He was told by DW3 that funds were needed to implement the listing proposal. Under re - examination, P further explained that DW3 had imposed a condition that in order for P to be allowed to invest (and earn a good return), he was required to give friendly loans (which were interest - free) to Datuk Wan and DW3.

According to P, upon agreeing to grant friendly loans to Datuk Wan (RM 6 million, subsequently reduced to RM 4.5 million) and DW3 (at least RM 9 million as admitted by him) respectively, he was permitted to subscribe for the new shares (one million shares) in the company at the price of RM 1 million. It was promised to him that upon the successful implementation of the listing proposal, he would get a return of RM 15 million.

The undisputed documentary evidence shows that on 25.11.2020, P paid RM 1 million by way of his personal cheque which was banked into the company n the same day, the share certificate for the new allotment of one million shares was issued by the company to P in his personal capacity.

There is no documentary evidence which suggest that the said one million shares or any part thereof were held by P on trust for DW3. Or that DW3 was the beneficial owner of any part of the said one million shares.

P said that he was brought by DW3 to meet with the Defendants at the office of the RP group in front of Baystar Condominium sometime at the end of year 2020. It was agreed that P would transfer 600,000 shares to the Defendants (480,000 shares to D1 and 120,00 shares to D2) to facilitate the implementation of the listing proposal. The total agreed consideration was RM 9 million, but the time for payment was deferred until after the successful implementation of the listing proposal. Subsequently, the transfer of the shares by P to the Defendants was effected on 8.9.2021. Meeting between the parties

In support of their allegation that P held the shares as trustee for DW3 and that they did not agree with P to purchase the shares from him, both the Defendants claimed that they did not know P and had never met with him before the transfer of the shares.

Under cross - examination, both D1 and D2 said they were not sure if they attended an AGM (annual general meeting) of the RP group in December 2020 at its office opposite Baystar Condominium, citing the MCO (movement control order) as the reason why they were not sure. Both the Defendants denied that they met with P there around that time. But their evidence is unreliable in the light of the evidence of DW3.

During cross - examination, DW3 initially denied that there was such . But when shown the printouts of his own power point presentations for the 23.12.2020, he reluctantly admitted that a physical meeting was held at that time, although he claimed that he was not sure of the venue. It appears DW3 would not have admitted, if not for the incontrovertible proof shown to him. In this instance, he could not deny the occurrence of the meeting on 23.12.2020 due to his own power point presentations at that meeting.

Under further cross - examination, DW3 also admitted that the Defendants were present at the meeting. However, DW3 said he cannot recall if around that time, he met with P together with the Defendants at that office.

If, as claimed by the Defendants, they never met with P, surely DW3 would have said so. It must be borne in mind that when DW3 said he cannot recall if they met with P, his own power point presentations presented at that meeting had just been shown to him. Thereby preventing DW3 from not prepared to admit that he had met with P together with the Defendants circumstances that DW3 had said he could not recall if such a meeting took place.

In contrast, P DW3 and the Defendants at that time was unequivocal. He was not shaken under cross - examination and was firm about what was discussed during that meeting. Second issue - No trust of the shares

The basis of the allegation that P held the shares as trustee for DW3 is this. They claim that DW3 had negotiated with Datuk Wan to purchase 60 % of the company 15 million, and had obtained friendly loans from P in the total sum of RM 9 million to fund the purchase.

The loan sum of RM 9 million was alleged to have been disbursed by P as follows:- (a) RM 1 million to the company as share capital; (b) RM

4.5 million to Datuk Wan; and (c) RM 3.5 million to DW3, who in turn paid the same to Datuk Wan.

The Defendants allege that following the aforesaid disbursement of the loan sum, one million shares in the company were issued and registered under P . Of which, 600,000 shares were held by P as trustee for DW3.

On 8.9.2021, DW3 sold the said 600,000 shares to the Defendants at a purchase price of RM 600,000. It is also alleged that the Defendants agreed to pay a further sum of RM 11.4 million to DW3 on the successful implementation of the listing proposal (which did not materialise).

P commenced this action on 23.9.2024. The writ was served on the Defendants on 14.10.2024. Immediately thereafter, DW3 filed a suit against P at the Penang High Court vide Suit No. PA - 22 NCvC - 148 - 10 / 2024 Penang suit .

In the Penang suit, DW3 seeks for a declaration that P held the shares in the company as trustee for him, and that the loan of RM 9 million lent by P to him is void. From the statement of claim in the Penang suit, DW3 has repaid only a sum of RM 3 million to P, and has no intention of repaying the balance. At the same time, he is claiming that all the shares in the company held by P are beneficially owned by him.

I reject the allegation of trust put forward by the Defendants and DW3. Not only is such allegation unsupported by evidence, it is also implausible and contrary to the contemporaneous documentary evidence. Further, the testimonies of the D - contradictory.

First, the basis of the alleged trust is that DW3 negotiated with Datuk Wan to buy 60 % of the company 15 million, and had borrowed RM 9 million from P to fund the purchase. DW3 testified that he had paid RM 9 million (using P % shares which amounted to 1.2 million shares, and agreed to pay another RM 6 million to Datuk Wan upon successful listing of the RP group in Taipei.

DW3 then sold 600,000 shares to the Defendants. In cross - examination, DW3 said that the 600,000 shares were sold to the Defendants at RM 600,000, with the agreed additional RM 11.4 million only upon the successful implementation of the listing proposal.

I consider such allegation to be untenable for the following reasons.

(a) The most obvious implausibility in such allegation is that according to DW3, even before the Taipei listing, he had paid RM 9 million (using borrowed money) to purchase 1.2 million shares. Out of that, he sold 600,000 shares to the Defendants for only RM 600,000. Crucially, that was half of the shares he purchased, for which he had paid RM 4.5 million (half of the RM 9 million).

(b) When cross - examined, DW3 denied that it was improbable for him to sell what he bought at RM 4.5 million to the Defendants for only RM 600,000. However, he offered no explanation in re - examination, except saying that the transaction was based on his agreement. I find the whole trust story to be rather dubious.

(c) Further, Datuk Wan owned only 500,000 shares, which was 50 % of the company Plainly, he cannot sell 60 % or 1.2 million shares to DW3.

(d) Additionally, the new one million shares allotted to P were issued by the company. Although Datuk Wan was the founder of the company and one of its directors, the company is a separate entity. Any payment to subscribe for the new allotment of shares must be paid to the company, and not to its director or founder.

(e) DW3 1 million to the company and RM 8 million to Datuk Wan to purchase 1.2 million shares, including the one million new shares allotted to P by the company, is inherently improbable.

Second, although both the Defendants allege that they were told by DW3 that P held the 600,000 shares on trust for DW3, it was demonstrated in cross - examination that such allegation is untrue.

(a) D2 went against his pleaded defence and disproved his own case when he said these in cross - examination : Q: So for the transfer of shares you know is not a gift right? Not a gift from Mr. Queck, you understand ya at all times? Ya, I understand. Yes, so since it was not a gift, you understand you must pay for the shares right? You must pay for the shares, to whoever, how much Yes, I know about that. And you agree also you have admitted that you never paid him, correct? You never paid Mr. Queck? Actually all the matters I already passed to Neo Ching Yuen to handle and then for the money I also transfer to Neo Ching Yuen. So you wanted to pay Mr. Queck but you asked Neo Ching Yuen to pay, is that what you said? to Mr. Queck. I see. Now, why did you make payment through Mr. Neo? Why did you pay through Neo Ching Yuen? So basically all the matters related to the shares is handled by Neo Ching Yuen, and then he represented me to negotiate for the transfer of the shares. Now, the shares were transferred by Mr. Queck to you, 120,000 shares so that shares was owned by Mr. Queck ya? You know that it was owned by Mr. Queck, correct? transfer to me. Did you find out from Mr. Neo Ching Yuen whether he has paid the money to Mr. Queck? So the money I have paid to Mr. Neo and also the shares have been transferred successfully to me so that I think this is consider a successful transaction. No, my question is did you find out from Mr. Neo whether he paid Mr. Queck the money? Not sure. Now, these shares, just to confirm again, these shares you bought from Mr. Queck and not from Mr. Neo Ching Yuen ya? Yes, I am clear about this. And Mr. Neo is not the beneficial owner of the shares? Neo Ching Yuen was not beneficial owner of the shares ya? Yes, I am clear about this.

(b) There was no re - examination on such judicial admission of D2.

(c) When it came to D1 confirmed that there were no company records for the alleged trusteeship. He admitted that it was risky for him to blindly believe what DW3 told him about the shares being held on trust, when he said these in cross - examination. Q: Were you aware that before he transferred his shares to you, Mr. Queck, the Plaintiff was registered shareholder of 1,000,000 shares in this company? I am not aware. You never made any company search before you purchase the shares? Have you made any search? Any company search before you purchase the shares? Kujaya this company in Johor is managing for foreign labour hostel. Did Mr., your partner means Mr. Neo Ching Yuen right? Yes, Neo Ching Yuen. Did he tell you who was the registered shareholder? No, he just mentioned that it is to purchase the shares from him and also from Datuk Wan. Actually I never know about Mr. Queck until the transfer form was issued then I know about Mr. Queck. you ask Mr. Neo Ching Yuen anything? I did ask Mr. Neo about Mr. Queck and then he answered that Mr. Queck is the proxy. Did he tell you what he meant by proxy? He did explain to me that he just temporarily registered under his No, he never tell us. Did he show you any document to prove that Mr. Queck was holding the shares for him? No, no, no the question is Mr. Neo, did Mr. Neo at that time you asked him, you said Mr. Queck is his proxy, proxy means trustee something like that, did you ask him and did he show you any documents to prove what he said? t further ask any questions. these documents shown in the bundles, Mr. Queck was the only, Mr. Queck was the registered shareholder and it does not show, there is nothing, no record no document which show that Mr. Queck was holding the shares on trust for Mr. Neo Ching Yuen? INT: No document, you mean no document can indicate that Mr. Queck ... Was holding the shares as trustee or proxy as you said for Neo Ching Yuen? Just like what I said after Mr. Neo told me about the proxy matter and rther ask any question. Did you check or verify with Mr. Queck whether he actually held the shares as trustee for Mr. Neo Ching Yuen? I actually never know Mr. Queck and then before he ... No, no, my question is not this, my question is did you verify with him? Did you reach out and try to contact this person and verify with him? No. After you became a director and you saw all the documents, all the documents did not or do not show that Mr. Neo Ching Yuen was the beneficial owner of the shares, no evidence at all right? There is no evidence that can show. There is also no company records which will show that Neo Ching Yuen is beneficial owner of any of the shares currently held by Mr. Queck right? I only know that Mr. Neo Ching Yuen asked us to transfer to him. No, first there is no record ya, okay, agree? Agree or disagree? INT: Agree or disagree there is no record ... Ya no record showing that he is the beneficial owner? No record. And you were also not interested to find out what documents, any when you signed the transfer form? You also not interested to find out what documents? Not interested to find out whether there is any document to support his claim that he is the true owner, beneficial owner? Not to say not interested but I just believe that Mr. Neo said that himself is the shareholder so I believe what Mr. Neo had said. If what you said is correct you took a risk, you trusted Mr. Neo blindly and you took a risk, agree? Yes.

(d) Actually, what D1 said contradicts D2 DW3 was not the beneficial owner of the shares.

Third, no explanation was proffered by the Defendants and DW3 as to why the shares could not be purchased directly by DW3, and had to be held by P on trust for DW3.

DW3 failed to address these pertinent questions :

(a) Why must the one million shares be allotted to P and registered in his name, instead of being issued directly to DW3, if what he claimed was true?

(b) Why must RM 4.5 million out of the RM 9 million loan sum given by P to him be given directly to Datuk Wan, instead of being disbursed to him and then only paid by him to Datuk Wan (like the other RM 3.5 million loan)?

The absence of any reasonable explanation for such unusual transactions as alleged suggest that the allegations are rather implausible. In contrast, P produced documentary evidence (in the form of separate friendly loan agreements) to show that :

(a) he had given separate and distinct interest - free friendly loans to Datuk Wan and DW3; and

(b) the sum of RM 4.5 million paid to Datuk Wan was a separate loan given by P to Datuk Wan, and not part of the loan given to DW3.

Fourth, there was no reason given as to why P, a professional engineer and a seasoned investor, would allegedly hold one million shares on trust for DW3 whilst granting him an interest - free loan of RM 9 million.

Fifth, DW3 has not repaid at least RM 6 million out of the RM 9 million loan taken by him from P. He has no intention of repaying it. In the Penang suit, he has asked for a declaration that the loan is void.

It is trite law that beneficial interest does not pass to a purchaser who has not fully settled the purchase price. (See the Federal Court decision in Borneo Housing Mortgage Finance Bhd v Time Engineering Bhd [1996] 2 MLJ 12 at 29).

In the final analysis, P was the one who had paid for the shares. DW3 claims that the money paid by P for the shares was a loan from P to him. But, whilst claiming beneficial ownership of the shares, he has evinced an intention not to repay the loan. In any event, he has not repaid the loan. Hence, even based on DW3 beneficial ownership of the shares when he did not pay for them. Alleged payments by the Defendants to DW3

The Defendants claim that they had paid RM 600,000 to DW3. However, they have failed to prove it. The 2nd Defendant

D2 alleged that the consideration for the 120,000 shares transferred to him was RM 120,000. And that the said sum was paid by him to DW3 by way of cheque payment vide CIMB Bank cheque number 011984 dated 9.6.2021. In support, he referred to pages 37 to 38 of Bundle B of the Common Bundle of Documents.

Q & A 6 of his witness statement reads : Q6: Have you paid the consideration of the 120,000 units of the said Shares? A6: Yes, the consideration of 120,000 units of the said Shares i.e. RM 120,000- 00 has been paid by me to NCY by way of cheque payment vide CIMB Bank cheque number 011984 dated 09.06.2021. [see pages 37 and 389 of CBD Part B (Enclosure 47)]

However, page 37 of Bundle B is only a cheque butt for cheque number 011984. It is written there the purported date (9.6.2021), for 280,000. Whilst page 38 of Bundle B is a bank statement which shows that cheque number 011984 was cleared on 10.6.2021 for RM 280,000.

The cheque butt is not the cheque image. Under cross - examination, D2 admitted that he did not produce the image of the cheque, although he could have obtained a copy of the cheque image from the bank.

The bank statement does not show to whom the sum was paid, and the cheque butt is also not evidence for that. Neither has DW3 produced his bank statement to prove receipt of such payment.

Thus, D2 has failed to prove any such payment. Furthermore, the bank statement shows that the amount paid, if any, was RM 280,000 and not RM 120,000. This is inconsistent with D2

In cross - examination, D2 testified that he paid RM 240,000 for the shares transferred by P to him. Not RM 120,000, nor RM 280,000. He testified that the extra RM with the testimony of DW3 in his witness statement that the RM 40,000

Finally, the sum of RM 280,000 was allegedly paid on 9.6.2021. The shares were only transferred on 8.9.2021, some three months later. Based on D2 DW3 at the alleged price sometime in August 2021. (See Q & A 4 of his witness statement).

I conclude that the alleged payment which was made on 9.6.2021 cannot be payment for the shares. Because as of that date, D2 had not agreed to purchase the shares from DW3, and DW3 had not agreed to sell the shares to him. The 1st Defendant

D1 testified that the consideration for the 480,000 shares transferred by P to him was RM 480,000. And that the said sum had been paid by him to DW3 by way of contra against part of the debt owed by DW3 to him back in the year 2020, which consist of a loan of RM 1 million given by him to DW3 on 28.2.2020. In support, D1 produced:- (a) a bank transaction slip (page 36 of Bundle B); and (b) a bank statement (page 3 of Bundle C of the Common Bundle of Documents).

Q & A 6 of his witness statement reads : Q6: Have you paid the consideration of the 480,000 units of the said Shares? A6: Yes, the consideration of 480,000 units of the said Shares i.e. RM 480,000- 00 has been paid by me to NCY by way of contra against part of the debt owed by NCY to me back in 2020 which consists of a loan in the sum of RM 1,000,000-00 which was given by me to NCY on 28.2.2020. [see page 36 of CBD Part B (Enclosure 47)] [see page 3 of CBD Part C (Enclosure 48)]

D1 admitted under cross - examination that the transaction was an over the bank counter transfer. He was required to fill up a form, in which he had to state the purpose of the payment. He also admitted that the transaction slip does not show that the payment was for loan. Even if he were to produce the form filled up by him over the counter, it would show that such payment was not for loan. Thus, his evidence is contrary to contemporaneous documents.

In cross - examination, D1 admitted that there was no loan agreement between him and DW3. There was neither Whatsapp messages, SMS messages, email nor any document which would show that DW3 wanted a loan and D1 gave him a loan. He further admitted that there was no evidence - whether agreement, Whatsapp messages, SMS messages, email, acknowledgement of receipt or any supporting document - to show that on 8.9.2021 he had agreed to set off RM 480,000 from the alleged loan as payment for the shares.

Finally, D1 said that there was no agreement as to when DW3 should repay the alleged loan of RM 1 million to him. There was also no evidence of the repayment of the balance RM 520,000.

It appears that D1 has produced the bank transaction slip (page 36 of Bundle B) because that sum of RM 1 million was the only payment which he could find that he ever paid to DW3. But that payment cannot be for the shares. D1 had to pick it up as evidence because he could not find any other payment to DW3. As the payment was made about one and a half year before the transfer of the shares, D1 had to create the story of loan and contra repayment to support his allegation of payment. It remains a story which is not supported by cogent evidence.

I conclude that the Defendants have no evidence to prove any payment to DW3 for the shares transferred by P because they never paid him for the shares. Third issue - No delay or estoppel

The Defendants contend that P slept on his complaint for almost three years after the transfer of the shares on 8.9.2021. But such contention ignores P of the purchase consideration until after the success of the listing proposal. It was only in December 2023 that it became apparent that the listing proposal could not materialise.

This explanation is not improbable. The D that they agreed to pay a substantial additional amount to NCY upon the success of the listing proposal actually supports P . Hence, there was no delay on the part of P.

Even if there was a delay, it does not give rise to laches, acquiescence, waiver or estoppel. It is not the D such alleged delay had caused prejudice to them. Or that they had relied on such alleged delay and acted to their own detriment.

The main plank of the D :

(a) P bears the burden to prove:- (i) his beneficial ownership of the shares; and (ii) the existence of the agreement between him and the Defendants in respect of the transfer of the shares. P has failed to prove both the above; and

(b) Defen sufficiently proves that P merely held the shares on trust for DW3.

However, the D The D facts and P The evidence establishes the following :

(a) The shares were registered in P to the transfer to the Defendants. This constitutes prima facie evidence that legal title to the shares was vested in P.

(b) The shares were allotted directly to P by the company. P was the one who had fully paid for the shares. The share certificate was issued to him in his personal capacity. This constitutes further prima facie evidence that the beneficial ownership in the shares had been vested in P.

(c) P transferred the shares to the Defendants. It was never meant to be a gift. Payment must be made for the transfer.

(d) P never received any payment for the transfer of the shares. This is prima facie evidence of total failure of consideration.

Recall that P enrichment. P is seeking a retransfer of the shares for total failure of consideration. It is not in dispute that the Defendants never paid P for the shares.

It must also be borne in mind that th case for non - payment is not based on any dispute regarding the amount of the purchase price payable. They never said - there was a dispute as to how much we should pay you. You allege that the agreed price was RM 9 million, but we say it was RM on their pleaded defence and their testimony, the one and only reason why they did not pay P was because he was allegedly not the true owner of the shares, and only held the shares on trust for DW3, to whom they had allegedly paid the purchase price. It follows that the agreement between the parties for the sale of the shares at the price as averred by P, is not an element which has to be proved.

The real issue here is whether the Defendants have proved their defence that P merely held the shares on trust for DW3, and therefore is not entitled to be paid. As per section 102 of the Evidence Act 1950, in view of the facts as stated above, if no evidence were given on either side, P would succeed as the non - payment for the transfer of the shares is not disputed and the trust is not proved. Declaration of beneficial ownership of the shares

The Defendants submit that P never declared his beneficial ownership of the one million shares since the shares were registered in his name on 25.11.2020. Further, that he never declared his beneficial ownership of the 600,000 shares since 8.9.2021 despite not having received payment. Actually, such submission further negates their own allegation of trust. As the only person who actually did not declare any beneficial ownership, despite alleging to be the beneficial owner of the shares, is DW3.

First, the requirement for a shareholder to declare his beneficial ownership is provided for in section 60D of the Companies Act 2016, which was inserted by the Companies (Amendment) Act 2024 which came into effect only on 1.4.2024. Therefore, the complain that P failed to declare his beneficial ownership since 25.11.2020 is baseless.

Second, P .8.2024 to change in his particulars as one of the beneficial owners. Namely, from 20 % (400,000 shares) direct ownership to 20% direct ownership plus 30 % (600,000 shares) indirect / beneficial ownership, upon demand for the return of the shares from the Defendants.

The declaration of such change is required by section 60D (2) of the there was already an earlier declaration and changes were needed. There was no delay in P terminated the transaction with the Defendants for total failure of consideration and demanded for return of the shares.

The beneficial ownership, which initially vested in P, was transferred to the Defendants subject to payment. Upon their failure to pay, P was entitled to terminate the transaction with the Defendants. But, before terminating the transaction, P cannot ask for restitution and had not become the beneficial owner. The moment he terminated the transaction and demanded for restitution, the Defendants held the shares on a resulting trust in favour of P. The beneficial ownership vested back in P.

Third, DW3 admitted under cross - examination that he never declared his alleged beneficial ownership of any part of the one million shares (including the balance 400,000 shares now held by P) to the company. As his cross - examination took place on 6.11.2025 during the trial, long after the coming into effect of section 60D of the Companies Act 2016, his failure to declare such alleged beneficial ownership, following the logic of the D he did not have any beneficial ownership.

Fourth, as a director of the company, DW3 owes an additional duty under section 219 (1) of the Companies Act 2016, read together with sections 8 and 59 of the same Act, to declare to the company his alleged interest in the shares still held by P. But as admitted by him, he never declared any such beneficial interest. Such conduct, by the same token, shows an absence of any trust over the shares.

In the course of implementation of the listing proposal, all the shareholders of the company had transferred their respective shares in the company to RP Manpro. After the failure of the listing proposal, RP Manpro retransferred the shares back to the respective original shareholders, which included the retransfer of 600,000 shares to the D .12.2023 was signed by all the company, including P, approving such transfer. The Defendants argue that P beneficially owned the 600,000 shares.

on is ineffectual t Additionally, the resolution was signed at a time before P terminated the transaction and demanded for return of the shares from the Defendants. He was, at that time, still entitled to wait for payment.

More importantly, the D P transferred from P to RP Manpro was retransferred back to P. Similarly, what was transferred from the Defendants had to be retransferred back to them. It is misconceived for the Defendants to say that P should have required RP Manpro to retransfer the 600,000 shares directly to him. Whatsapp messages

The Defendants harp on the Whatsapp messages by which P had updated DW3 of the company DW3 it demonstrates DW3 However, the Defendants have ignored the missing pages of the Whatsapp messages produced by them and the implication of such missing pages. In re - examination, P produced the missing pages and provided a reasonable explanation.

P His purpose of acquiring the company shares was investment, in order to earn a good return from the listing proposal. DW3 was the person tasked with the responsibility and in charge of the listing proposal, which necessarily included merger and reasonable for P to update DW3 with the company tion and seek confirmation with regard to the company to its financial matters. Especially the related party transactions as shown in the missing pages of the Whatsapp messages. Summary

In the premises, I consider that the D merit. The allegation of trust is a concoction by them and DW3. In the light of the evidence, there cannot be any intention, let alone certainty of intention, for the creation of any trust over the shares.

P he had agreed to transfer 600,000 shares to the Defendants for a purchase price of RM 9 million, the payment of which was deferred by mutual agreement to after successful implementation of the listing proposal, is believable. In any event, the undisputed fact remains that the Defendants have not paid any consideration to P for the transfer of the shares. Accordingly, P has through his solicitor s letter terminated the transaction with the Defendants for total failure of consideration.

It is unconscionable for the Defendants to keep the shares, as they will be unjustly enriched vis-à-vis P. In the circumstances, judgment should be entered in favour of P for restitution of the shares. Conclusion

For the reasons above, I . I award costs of RM 50,000 to P. Dated 2 January 2026 Quay Chew Soon Judge High Court of Kuala Lumpur (Commercial Division NCC 2 & Admiralty 9) Counsels Wong Yee Chue, Ho Hui Ying and Jean Aw Yuen Hui (Messrs. Y.C. Wong) for the Plaintiff Steven Tan Chee Qian, Max Chuah Chern Tee and Low Han Shin (Messrs. Chuah Qian & Partners) for the Defendants Case reference 1. Kong Hoi Cheing v AK Land Sdn Bhd [2021] 6 MLJ 725 2. Fawziah Holdings Sdn Bhd v Metramac Corporation Sdn Bhd & another appeal [2006] 1 CLJ 996 3. Ong Kong Beng & Anor v Ong Kong Leong & Ors [2022] MLJU 482 4. Borneo Housing Mortgage Finance Bhd v Time Engineering Bhd [1996] 2 MLJ 12 Legislation reference 1. Section 101 (1) of the Companies Act 2016 2. Sections 101(2), 102 and 114 (g) of the Evidence Act 1950