Sathiyan A/L Gopal v Kavilashini A/P Selvarajah (BA-24NCC-145-11/2023)

WAWASAN KVL OCCUHEALTH SDN BHD …Defendan-Defendan GROUNDS OF JUDGMENT Introduction [1] This is the Plaintiff's application under s.346 of the Companies Act 2016 (the Act 2016) for the statutory remedy of oppression (enclosure 1). [2] After hearing both parties, read the affidavits and written submissions filed, I dismissed enclosure 1 with a cost of RM15,000.00 to the Defendants. My brief grounds pronounced are as follows: Decision: The Plaintiff had, in his OS, requested 20 main prayers, which include orders for discovery, inspection of documents, injunctions, damages and 22 more alternative prayers, which include orders for winding up. Plaintiff's grounds for the application were as in his extensive affidavit in support, affidavit in reply and additional affidavit. Defendants objected to this application in their line of affidavits filed. Having heard both parties and read the affidavits and submissions filed, I am of the opinion as follows: Plaintiff filed this application under s346 of CA, alleging being oppressed of his rights as a shareholder. It was posited that D1 had purportedly attempted to force Plaintiff to transfer his 50% shares in D2 without any compensation, Plaintiff was removed from the company's WhatsApp groups, he was chased out from D2 company's premises, and D1 had failed to act in the best interest of the company. Defendants conceded that Plaintiff's access to the company premises was restricted in order to protect the company's employees from being allegedly harassed by Plaintiff. In retaliation, Plaintiff refused to attend board meetings and refused to approve payments on the daily operation of the company, including salary payments. It was asserted that Plaintiff controls the company finances. After carefully considering lengthy narratives canvassed by both parties, I find those incidences, acts or omissions by both parties are consequences of domestic grudge and resentment felt by Plaintiff and D1. I failed to see any establishment of oppression under s.346 to show disregard for the Plaintiff's interest as a shareholder. I agree with the Defendants that the test to be applied is whether the conduct was burdensome, harsh and wrongful or showing disregard for the interest of Plaintiff. Even if there were instances in which action or omission irritates a party, either by Plaintiff or D1, it was due to a drastic decision which D1 will need to take to ensure smooth management and survival of the company. Therefore, Plaintiff cannot claim to be oppressed just because he felt aggrieved by the management decision made by D1. I will not discuss in detail all the issues raised by both parties, but it is sufficient to conclude here, after perusing all affidavits and submissions filed, that I agree with Defendant that Plaintiff had failed to prove oppression or discrimination by D1 in any of her action in managing the company to entitle him of all these massive prayers in the OS. Enclosure 1 is hereby dismissed with a cost of RM15,000.00 subject to the allocator. There will be no order on enclosure 19. [3] Dissatisfied with the above decision, Plaintiff now appealed to the Court of Appeal and below are my reasons. Originating Summon – Enclosure 1 [4] For ease of reference and clarity, the prayers sought in the application were as follows:

Satu Perintah bahawa satu juruaudit bebas dilantik ke atas Defendan Kedua dengan kuasa untuk menyiasat kesemua urusan, transaksi, resit-resit, akaun-akaun, bayaran-bayaran, dan komisen-komisen Defendan Kedua dan tidak terhad yang telah beralih ke tangan Defendan Kedua dan Defendan Ketiga atau diterima oleh orang lain bagi pihak atau atas akaun Defendan Pertama dan bahawa kesemua pertanyaan dan arahan yang perlu diambil dan dibuat dan menyediakan satu akaun lengkap kepada Mahkamah yang Mulai ini dalam 30 hari dari tarikh lantikan atau mana-mana tempoh lanjutan yang difikir sesuai dan manfaat oleh Mahkamah yang Mulia ini.

Satu perintah bahawa satu juruaudit bebas dilantik ke atas Defendan Kedua dan Syarikat Defendan Ketiga dengan kuasa untuk menyiasat kesemua urusan, transaksi, resit-resit, akaun-akaun, bayaran-bayaran dan komisen-komisen dalam menjalankan perniagaan yang sama dengan Defendan Kedua dan menyediakan satu akaun lengkap kepada Mahkamah yang Mulai ini dalam 30 hari dari tarikh lantikan atau mana-mana tempoh lanjutan yang difikir sesuai dan manfaat oleh Mahkamah yang Mulia ini.

Satu perintah bahawa Defendan Pertama dan Syarikat Defendan Ketiga untuk membekalkan satu senarai menyeluruh/komprehensif bagi semua urusan, transaksi, resit, akaun, pembayaran dan komisen dan juga menyerahkan kesemua buku syarikat, akaun-akaun, dokumen-dokumen, penyata bank, dan kesemua material termasuklah data-data dan/atau maklumat ringan dan keras tentang Defendan Kedua dan Syarikat Defendan Ketiga kepada juruaudit bebas tersebut dan apabila diminta oleh juruaudit tersebut.

Defendan Pertama dan Syarikat Defendan Ketiga haruslah mendedahkan kesemua dokumen-dokumen yang diminta dan haruslah mengikrarkan affidavit dan/atau akaun berkanun apabila diminta oleh juruaudit sepanjang pelantikan juruaudit bebas.

Juruaudit bebas memiliki kuasa mutlak untuk berurusan dan berhubung dengan kesemua bank, pemiutang, penghutang, pelanggan, pekerja Defendan Kedua dan agensi kerajaan yang akan menyediakan dan menyerahkan maklumat, dokumen-dokumen dan penyata-penyata yang dipohon oleh juruaudit tersebut.

Satu perintah di mana juruaudit bebas akan memiliki kuasa mutlak ke atas akuan-akaun bank yang dimiliki oleh kesemua Syarikat Defendan Kedua dan berurusan dengan bank-bank tersebut seperti yang diperintahkan oleh Mahkamah yang Mulia ini.

Satu perintah terhadap kos dan perbelanjaan juruaudit bebas ini ditanggung oleh kesemua Defendan Pertama dan Syarikat Defendan Ketiga dari akaun-akaun Defendan Pertama dan/atau Syarikat Defendan Ketiga menjadi caj pertama dan dibayar terlebih dahulu sebelum pembayaran lain.

Satu perintah di mana juruaudit adalah bebas untuk membuat permohonan untuk perintah selanjutnya dan arahan-arahan selanjutnya.

Satu perintah injunksi dari mahkamah untuk menghalang Defendan Pertama dan Syarikat Defendan Ketiga sama ada dengan sendirinya atau melalui ejen-ejen mereka, pekerja dan/atau mengambil kerja secara langsung atau tidak langsung berurusan dengan mana-mana dan semua pelanggan yang Defendan Kedua, untuk pengambilan pelanggan-pelanggan atau perniagaan seperti itu atau yang serupa Syarikat Defendan Kedua.

Di mana jika didapati oleh Mahkamah yang Mulia ini terdapat amaun yang terhutang dan perlu dibayar berdasarkan repot juruaudit bebas, satu perintah terhadap Defendan Pertama dan Syarikat Defendan Ketiga sama ada dengan sendirinya atau melalui ejen-ejen, pekerja dan/atau mengambil kerja membayar balik semua keuntunggan atas akaun Syarikat Defendan Kedua kepada akaun Syarikat Defendan Kedua.

Di mana jika didapati oleh Mahkamah yang Mulia ini terhadap amaun yang terhutang dan perlu dibayar berdasarkan repot juruaudit bebas, satu perintah di mana juruaudit bebas tersebut diberi kuasa untuk menjelaskan bayaran dari akaun bank Syarikat Defendan Kedua seperti yang terhutang dan yang perlu dibayar kepada Plaintif dan/atau Defendan Pertama (setelah kesemua tolakan gantirugi-gantirugi amaun yang harus dibayar oleh Defendan Pertama kepada Plaintif dilakukan) yang diperolehi oleh juruaudit bebas tersebut.

Defendan Pertama dan Syarikat Defendan Ketiga secara bersesama dan berasingan membayar Plaintif ganti rugi teladan dan/atau punitif dan/atau kerugian yang akan dinilai oleh Pendaftar.

Defendan Pertama dan Syarikat Defendan Ketiga untuk membayar kos bagi tindakan ini kepada Plaintif atas dasar fi peguam dan Syarikat Defendan Kedua.

Bahawa ganti rugi di perenggan 12 dan 13 di atas dan kos dari kesemua ganti rugi perenggan 12 yang akan diberikan oieh Mahkamah yang Mulia ini adalah ditanggung dan/atau dibayar dari harta dan/atau aset Defendan Pertama dalam Syarikat Defendan Kedua terus kepada Plaintif dan juruaudit bebas adalah diberi kuasa untuk membuat tolakan tersebut.

Bahawa jumlah-jumlah yang dinyatakan di atas di perenggan 14 dibayar kepada Plaintif dalam tempoh empat belas (14) hari daripada tarikh perintah ini.

Satu perintah bahawa Defendan Pertama dan/atau Syarikat Defendan Ketiga mendedahkan kesemua penyata bank, senarai pelanggan- pelanggan Syarikat Defendan Ketiga, senarai penyata gantirugi dari tempoh 01.04.2023 hingga tarikh perintah ini dalam tempoh empat belas (14) hari dari tarikh perintah ini;

Gantirugi am yang akan ditaksirkan dan/atau pampasan yang setimpal dibayar oleh Defendan Pertama dan Syarikat Defendan Ketiga kepada Plaintif dan/atau Defendan Kedua;

Faedah pada kadar 5% setahun ke atas jumlah perenggan 14 dari tarikh pemfailan saman pemula ini sehingga penyelesaian penuh;

Satu injunksi kekal bahawa Defendan Pertama dan Syarikat Defendan Ketiga dihalang dan tidak beroperasi di premis beralamat di No. 47, Jalan Utas 15/7, Section 15, 40200 Shah Alam Selangor secara terus dan/atau secara tersirat;

Bahawa setelah kesemua perintah perenggan (1) hingga (19) di atas selesai, Syarikat Defendan Kedua diperintahkan untuk digulungkan.

Secara alternatif kepada perenggan (1) hingga (20) di atas, Plaintif memohon untuk perintah-perintah yang berikut :-

21.1. Satu perintah terhadap Defendan Pertama dan Syarikat Defendan Ketiga di dalam masa 30 hari dari tarikh perintah mengikrarkan satu afidavit dengan menjelaskan kesemua maklumat terperinci dan menyediakan salinan semua urusan, transaksi, resit-resit, akaun, bayaran-bayaran, dan komisen-komisen beserta dengan semua penyata bank yang dimiliki oleh Defendan Pertama dan Syarikat Defendan Ketiga yang telah menjalankan perniagaan yang sama dengan Syarikat Defendan Kedua; dan 21.2. Satu perintah terhadap Defendan Pertama dan Syarikat Defendan Ketiga di dalam masa 30 hari dari tarikh perintah ini mengikrarkan satu affidavit dengan menjelaskan kesemua maklumat terperinci dan menyediakan salinan semua urusan, transaksi, resit-resit, akaun, bayaran-bayaran, dan komisen-komisen berserta dengan semua penyata bank yang dimiliki oleh Syarikat Defendan Ketiga yang telah menjalankan perniagaan yang sama dengan Syarikat Defendan Kedua termasuk pengambilan alih pelanggan-pelanggan Syarikat Defendan Kedua; dan 21.3. Satu perintah untuk satu tarikh pendengaran ditetapkan oleh Mahkamah yang Mulia ini untuk memeriksa balas deponent affidavit-afidavit yang ditunjukkan dalam perenggan (21.1) dan (21.2) di atas; dan 21.4. Satu perintah terhadap Defendan Pertama dan Syarikat Defendan Ketiga sama ada dengan sendirinya atau melalui ejen-ejen, pekerja dan/atau mengambil kerja membayar balik semua keuntungan atas akaun Syarikat Defendan Ketiga yang diterima sejak penubuhan sehingga tarikh perintah Mahkamah kepada Syarikat Defendan Kedua seperti yang ditetapkan oleh Mahkamah yang Mulia ini; dan 21.5. Satu perintah bahawa Defendan Pertama menyediakan semua bantuan dan menyerahkan semua buku-buku akaun dan dokumen dalam tempoh 30 hari dari perintah Mahkamah ini adalah perlu bagi membolehkan Syarikat Defendan Kedua menyediakan akaun akhir bagi tahun 2023; dan 21.6. Satu perintah terhadap Defendan Pertama dan Syarikat Defendan Ketiga untuk membayar kesemua denda dan penalti yang dikenakan oleh Suruhanjaya Syarikat Malaysia terhadap Plaintif disebabkan kelewatan dalam penyerahan akaun Syarikat Defendan Kedua yang telah diaudit bagi tahun 2022 (jika perlu); dan 21.7. Defendan Pertama dan Syarikat Defendan Ketiga secara bersesama dan berasingan membayar Plaintfi ganti rugi punitif dan/atau teladan dan/atau kerugian yang akan dinilai oleh Pendaftar; dan 21.8. Defendan Pertama dan Syarikat Defendan Ketiga untuk membayar kos bagi tindakan ini kepada Plaintif dan Syarikat Defendan Kedua; dan 21.9. Bahawa gantirugi di perenggan 21.7 dan 21.8 di atas dan kos dari kesemua ganti rugi di perenggan 21.7 yang diberikan oleh Mahkamah yang Mulia ini adalah ditanggung dan/atau dibayar dari harta dan/atau aset Defendan pertama dalam Syarikat Defendan Kedua terus kepada Plaintif dan Plaintif diberikan kebebasan dan diberi kuasa untuk membuat tolakan tersebut terus dari bahagian syer Defendan Pertama dalam Syarikat Defendan Kedua; dan 21.10. Bahawa jumlah yang dinyatakan di atas di perenggan (21.9) dibayar kepada Plaintif dalam tempoh empat belas (14) hari daripada tarikh perintah ini; dan 21.11 Satu perintah bahawa Defendan Pertama dan/atau Syarikat Defendan Ketiga mendedahkan kesemua penyata bank, senarai pelanggan-pelanggan Syarikat Defendan Ketiga senarai penyata gantirugi dari tempoh 01.04.2023 hingga tarikh perintah ini dalam tempoh empat belas (14) hari dari tarikh perintah ini; dan 21.12. Bahawa setelah kesemua perintah (21.1) hingga (21.14) di atas selesai, Syarikat Defendan Kedua diperintahkan untuk digulungkan. a. Aset-aset milikan dan/atau yang dimilik dan/atau yang didaftarkan atas nama Defendan Kedua setakat tarikh perintah ini harus dijual dalam tempoh empat (14) hari dari tarikh perintah ini mengikut harga pasaran ("market value"); dan b. Plaintif dan Defendan Pertama diberikan pilihan pertama untuk membeli aset-aset milikan Syarikat Defendan Kedua; dan c. Setelah kesemua aset-aset milikan syarikat dijual kesemua hasil harus dibayar kepada akaun bank Syarikat Defendan Kedua; dan d. Defendan Pertama harus membayar amaun-amaun yang berikut dalam tempoh tujuh (7) hari kepada Syarikat Defendan Kedua dengan cara memasukkan amaun-amaun tersebut ke dalam akaun bank Syarikat Defendan Kedua iaitu: i. Sejumlah RM47,514.39 bagi Perintah Persetujuan yang dimasuki tanpa kelulusan Lembaga Pengarah Syarikat Defendan Kedua; dan ii. RM8,000.00 bagi papan tanda Syarikat Defendan Kedua yang kini dibenarkan untuk dijual oleh Syarikat Defendan Kedua oleh Defendan Pertama; dan iii. RM7,800.00 amaun yang dilucut hak oleh Tuan Tanah bagi premis Syarikat Defendan Kedua atas kegagalan Defendan Pertama untuk memberikan notis penamatan yang mencukupi; dan iv. RM600.00 yang didahulukan oleh Plaintif bagi pembaharuan lesen perniagaan Majils Bandaraya Shah Alam bagi tahun 2022/2023 sehingga bulan Disember 2023. v. Sejumlah RM53,393.56 (sekiranya wang telah digarnis dari akaun Syarikat Defendan Kedua) yang diperolehi terhadap Syarikat Defendan Kedua melalui satu penghakiman ingkar bertarikh 17.07.2023 secara tidak sah di sisi undang-undang.

21.13. Defendan Pertama harus mengemukakan akaun-akaun wang runcit ("petty cash") kepada Plaintif dalam tempoh empat (14) hari dari tarikh perintah ini dari tempoh 26.11.2022 hingga 01.04.2023. Kesemua amaun ini sekiranya terdapat kekurangan Defendan Pertama harus membayarnya ke dalam akaun Syarikat Defendan Kedua; dan 21.14. Defendan Pertama harus mengemukakan senarai pemiutang-pemiutang ("creditors") Syarikat Defendan Kedua kepada Plaintif dalam tempoh tujuh

hari dari tarikh perintah ini dan Plaintif dibenarkan untuk mengutip dan mengumpul kesemua amaun-amaun tertunggak tersebut yang harus dibayar dan dimasukkan ke dalam akaun Syarikat Defendan Kedua; dan

21.15. Kos atas dasar indemniti penuh oleh Defendan Pertama dan/atau Syarikat Defendan Ketiga kepada Plaintif; dan 21.16. Bahawa gantirugi di perenggan 21.6, 21.7, 21.8, 21.12, 21.13, 21.16, 21.17 dan kesemua kos dari kesemua gantirugi yang diberi oleh Mahkamah yang Mulia ini adalah ditanggung dan/atau dibayar dari harta dan/atau aset Defendan pertama dalam Syarikat Defendan Kedua terus kepada Plaintif dan Plaintif dan/atau pihak bank terlibat bebas dan adalah diberikuasa untuk membuat tolakan tersebut; dan 21.17. Gantirugi am yang akan ditaksirkan dan/atau pampasan yang setimpal dibayar oleh Defendan Pertama dan Syarikat Defendan Ketiga kepada Plaintif dan/atau Defendan Kedua; dan 21.18. Faedah pada kadar 5% setahun keatas jumlah perenggan (21.9) dari tarikh pemfailan saman pemula ini sehingga penyelesaian penuh; dan 21.19. Satu injunksi kekal bahawa Defendan Pertama dan Syarikat Defendan Ketiga dihalang dan tidak beroperasi di premis beralamat di No. 47, Jalan Utas 15/7, Section 15, 40200 Shah Alam Selangor secara terus dan/atau secara tersirat; dan 21.20. Setelah selesai kesemua urusan di perenggan 21.12 di atas, Plaintif dibenarkan untuk membuat kesemua bayaran bagi bil-bil tertunggak dan liabiliti-liabiliti Syarikat Defendan Kedua, termasuk fi guaman dan fi audit.

21.21. Setelah selesai kesemua di perenggan 21.16 di atas kesemua amaun-amaun yang masih dalam akaun Syarikat Defendan Kedua dibahagikan secara sama rata di antara Plaintif dan Defendan Pertama dan Syarikat Defendan Kedua boleh digulungkan setelah itu.

21.22. Sebarang perintah dan/atau relif lain yang dianggap sesuai dan adil oleh Mahkamah yang Mulia ini. Background facts Plaintiff's case [5] Plaintiff and the 1st Defendant (D1) are the directors and shareholders with equal shares of the 2nd Defendant company (D2). They were both husband and wife at the material time. D3 is a company incorporated by D1 on 30.12.2022, having the same nature of business as D2. [6] D2 was established and operates as a clinic by both Plaintiff and D1. The Plaintiff holds the position of director and marketing personnel of D2, and D1 is a medical doctor responsible for the operation and management of D2. [7] Plaintiff asserts that D1 failed to operate and manage D2 as she failed to prepare the documentation for audited reports as required. When Plaintiff questioned D1 on the accounts, their relationship went sour. This was around November 2022. [8] Plaintiff further believed that D1's behavioural change was due to Plaintiff questioning her on the overpriced RTK test kit supplied by one company, Brighton Occuhealth Services Sdn Bhd. Plaintiff avers that Brighton Occuheath Services belonged to D1's father and her brother and alleged D1 had acted not to the benefit of D1 in her dealings with Brighton. [9] Subsequently, D1 denied the Plaintiff access to the clinic on 17.12.2022. She allegedly insulted the Plaintiff and even spat at him when the Plaintiff went into the premises to collect his belongings. [10] Plaintiff further states that D1 had started operating D3 at the same business address as D2 without Plaintiff's permission or approval, resulting in extreme profit loss to D2 and Plaintiff. It was submitted that D1 had employed the same employee with an increase in salary to work with D3. [11] Plaintiff asserts that D1 had conspired with D2's ex-employee to lodge a complaint to the Industrial Relations department for unpaid salary and termination benefits and alleged that D1 had intentionally entered a consent judgment at the Industrial Court for D2 to pay the employee salaries due to them. [12] Plaintiff also states that D1 had intentionally conspired with D2's employee to initiate a garnishee proceeding against D2, which had caused losses to D2 and Plaintiff. Act of oppression 1 – removal as shareholder [13] Plaintiff contends that D1 attempted to remove Plaintiff as a shareholder of D2 when she orchestrated and instructed Plaintiff to execute a shareholder agreement to transfer all shares without consideration. Plaintiff refused to execute, and thereafter, D1 allegedly instigated, insinuated and gathered employees of D2 and ex-staff to make false allegations of sexual misconduct and harassment against Plaintiff. [14] Plaintiff contended that those allegations were all devoid of logic and merits, and though police reports were lodged, no investigation was carried out or any charge initiated against Plaintiff. [15] The Plaintiff accused D1 of having used the alleged misconduct deliberately and in bad faith as a means of pressure to force the Plaintiff to agree to the transfer of shares. Act of Oppression 2 – removed from the company WhatsApp group [16] Plaintiff claims that it has been his responsibility to manage the employees from the company WhatsApp group. However, in January 2023, D1 instructed all employees of D2 to leave the company's official WhatsApp group and initiated another group without the Plaintiff being part of it. [17] This was allegedly intended to prevent the Plaintiff from having knowledge of instructions given by D1 in her daily communication with employees. Therefore, it was argued that D1 directly prevented any involvement of the Plaintiff with D2. Act of Oppression 3 – Company's daily affairs [18] The purpose of the company's WhatsApp group is to record and report specific matters regarding the company's daily cash collection. Plaintiff contended that D1's action of removing him from the WhatsApp group was, again, to prevent the Plaintiff from having knowledge of the company's daily affairs. [19] After his removal, he had no knowledge of the records of D2's daily cash receipts from November 2022 to April 2023, all of which were fully controlled by D1. Again, this prevents Plaintiff from having knowledge of the company's daily transactions. Act of Oppression 4 – no access to the clinic [20] Since 17.12.2022, Plaintiff has not been allowed to access the clinic by D1. When he attempted to collect his belongings, he was kicked out and spat in his face by D1. D1 has been unprofessional towards Plaintiff and continuingly acted not for the benefit of D2. Act of Oppression 5 – did not act in the best interest of D2 [21] Plaintiff asserts that D1 had appointed one Serithen a/l Gnapathy without the approval of Plaintiff as a shareholder and offered to pay a high salary to Serithen (RM6000). It was submitted that Serithen was previously paid RM1500 per month. This decision of D1, according to Plaintiff, was not in the best interest of D2. [22] Another employee of D2, Thanaraj a/l Gunalan had, on 28.3.2022 lodged a complaint to the Industrial Relation Department, and both of them (Serithen and Thanaraj) claims for unpaid salaries amounting to RM30,774.77, and D1 had consented for a judgment to be recorded. Plaintiff contends that this action is not for the benefit of the company and was initiated by D1 in bad faith to the detriment of D2. Unlawful termination of employees [23] Plaintiff also alleged that D1 had, on 26.11.2022, terminated an employee, Nyau Ke Xin, without Plaintiff's approval. [24] The dismissal was made on the allegation that Plaintiff had an affair with Nyau, which Plaintiff denies. Bad treatment and acts of insults against employees of D2 [25] Plaintiff states that D1 had mistreated the employee of D2 and kept insulting them with vulgar words, resulting in many employees resigning. Early termination of the Tenancy Agreement [26] Solicitors for D1 had issued a cease operation notice to the Plaintiff on 11.4.2023. This was done without Plaintiff's approval. The next day, on 12.4.2023, D1, acting unilaterally, issued a notice of early termination of the clinic's tenancy agreement against the tenancy terms that require 3 months' notice. Due to this, the deposit sum of RM7,800 was forfeited by the owner. [27] Plaintiff avers that D1's action had jeopardized D2's business and caused losses to D2. Incorporation of D3, Wawasan KVL Occuheath Sdn. Bhd. [28] Plaintiff alleges that D1 intentionally oppressed Plaintiff to remove him from D2 by incorporating D3 with the intent to take over D2's business for her own benefit. Plaintiff claims that he was only made aware of D3's incorporation around 30.12.2023. D3 operates at the same premises as D2, using the same assets and continues using the same notice board without Plaintiff's permission and approval. Therefore, its incorporation was a clear conflict of interest with D1's responsibilities in D2, resulting in a loss of profits to D2. [29] All present clients of D2 were transferred to D3, and D1 continued to represent their previous customers/clients in changing their service, appointing D3 as their new medical provider. [30] Plaintiff asserts that all fraud and deceit were committed by D1 with malicious intent to prevent and deny Plaintiff's rights as a shareholder to D2. [31] D1's actions caused extreme losses to D2, and with the establishment of D3, D1 is now making a profit for herself, and this clearly caused losses to D2 and the Plaintiff. [32] In addition, garnishment proceedings were commenced against D2 based on a consent judgment obtained by D1 in connection with the termination of D2's employees. [33] Hence, this application by Plaintiff under s. 346(1) of the Act 2016. Defendants contention [34] D1 presented the Defendant's version from a different perspective and on the basis of events that she considered necessary measures to maintain the operation and survival of D2 because Plaintiff refused and failed to fulfil his responsibilities as director in charge of marketing and meeting his daily financial obligations. [35] Below are the facts canvassed by D1. [36] On or about November 2022, Plaintiff and D1's relationship was strained due to Plaintiff's alleged affairs and sexual harassment conduct against the company's employees at that material time, and it was submitted that numerous police reports had been lodged. [37] In order to protect the company's employees from being further harassed by Plaintiff, D1 decided to restrict Plaintiff's access to the company's premises. [38] Dissatisfied with the restriction made by D1, Plaintiff has refused to attend any board meetings convened by D2 and has declined to approve payments for the employees' salaries, allowance and other expenses. [39] It was submitted that due to Plaintiff's oppressive manner in refusing to cooperate to manage D2, D1 was left on her own to pay for the company's expenses using her own money. [40] D2 could not survive if it relied solely on D1 as Plaintiff controls the company's finances. Due to out-of-control marital disputes between Plaintiff and D1, Plaintiff had refused to authorize payments for the company, which in turn had affected the company's operations, and this alleged bad faith action by Plaintiff was detrimental to the company's shareholders. [41] Further to the aforesaid, since Plaintiff and D1 could no longer cooperate in managing the company, Plaintiff had suggested to D1 that D2 be wound up. Consequently, acting on Plaintiff's suggestion, D1 then ceased the company's operation as it is no longer practical for the company to continue its business operation. The Law on Section 346 of the Companies Act 2016 [42] The oppression remedy is presently governed by s. 346 of the Act 2016, and it reads as follows: Section 346 Remedy on cases on oppression

Any member or debenture holder of a company may apply to the Court for an order under this section on the ground-

that the affairs of the company are being conducted or the powers of the directors are being exercised in a manner oppressive to one or more of the members or debenture holders including himself or in disregard of his or their interests as members, shareholders or debenture holders of the company; or

that some act of the company has been done or is threatened or that some resolution of the members, debenture holders or any class of them has been passed or is proposed which unfairly discriminates against or is otherwise prejudicial to one or more of the members or debenture holders, including himself.

If on such application the Court is of the opinion that either of those grounds is established, the Court may make such order as the Court thinks fit with the view to bringing to an end or remedying the matters complained of, and without prejudice to the generality of subsection (1), the order may-

direct or prohibit any act or cancel or vary any transaction or resolution;

regulate the conduct of the affairs of the company in the future;

provide for the purchase of the shares or debentures of the company by other members or debenture holders of the company or by the company itself;

in the case of a purchase of shares by the company, provide for a reduction accordingly of capital of the company; or

provide that the company be wound up.

If an order that the company be wound up is made under paragraph (2)(e), the provisions of this Act relating to winding up of a company shall apply as if the order had been made upon a petition duly presented to the Court by the company, with such adaptations as are necessary.

If an order under this section makes any alteration in or addition to any constitution, then, notwithstanding anything in any other provision of this Act, but subject to the order, the company concerned shall not have power without the leave of the Court to make any further alteration in or addition to the constitution inconsistent with the order, but subject to the foregoing provisions of this subsection, the alterations or additions made by the order shall be of the same effect as if duly made by resolution of the company.

An office copy of any order made under this section shall be lodged by the applicant with the Registrar within fourteen days from the making of the order.

The applicant who contravenes subsection (5) commits an offence and shall, on conviction, be liable to a fine not exceeding ten thousand ringgit and, in the case of a continuing offence, to a further fine of five hundred ringgit for each day during which the offence continues after conviction. - emphasis added [43] The statute provides that what is actionable is the "affairs of the company", not the "affairs of the shareholders". However, the Act 2016 does not define what is tantamount to "oppressive", "in disregard of his interest", "unfairly discriminates" or "prejudicial" for the purpose of s.346. [44] In Re Kong Thai Sawmill (Miri) Sdn Bhd; Kong Thai Sawmill (Miri) Sdn Bhd & Ors v. Ling Beng Sung [1978] CLJU 17 the Privy Council held that: "…for the case to be brought within s. 181(1)(a) at all, the complaint must identify and prove "oppression" or "disregard". The mere fact that one or more of those managing the company possess a majority of the voting power and, in reliance upon that power, make policy or executive decisions, with which the complainant does not agree, is not enough. Those who take interests in companies limited by shares have to accept majority rule. It is only when majority rule passes over into rule oppressive of the minority, or in disregard of their interests, that the section can be invoked. As was said in a decision upon the United Kingdom section there must be a visible departure from the standards of fair dealing and a violation of the conditions of fair play which a shareholder is entitled to expect before a case of oppression can be made (Elder v. Elder & Watson Ltd. 1952 SC 49): their Lordships would place the emphasis on "visible". And similarly "disregard" involves something more than a failure to take account of the minority's interest: there must be awareness of that interest and an evident decision to override it or brush it aside or to set at naught the proper company procedure (per Lord Clyde in Thompson Drysdale 1925 SC 311, 315). Neither "oppression" nor "disregard" need be shown by a use of the majority's voting power to vote down the minority: either may be demonstrated by a course of conduct which in some identifiable respect, or at an identifiable point in time, can be held to have crossed the line." [45] Therefore, guided by the case of Re Kong Thai Sawmill, the statutory remedy for oppression is directed against unfair conduct in the management of a company as a consequence of which a member or shareholder suffers injury in his capacity as such. [46] An oppression claim premised on the circumstances set out in s. 346(1) is a personal claim made by a shareholder who suffers a distinct and personal loss. If the harm has caused injury to one or more shareholders, then the oppression action is proper. [47] I am also guided by a Federal Court decision in Jet Tech Materials v. Yushiro v. Chemical Industry [2013] 2 CLJ 277, which held as follows: "[37] …A complaint under s. 181 of the CA must be confined to matters relating to the affairs of the company. Shareholders' agreement and breach of the same clearly are not matters relating to the affairs of the company. They are private matters enforceable by the parties to the shareholders' agreement. (See Beh Chun Chuan v. Paloh Medical Centre Sdn Bhd [1999] 7 CLJ 1, Tuan Haji Ishak Ismail v. Leong Hup Holdings Bhd & 5 Other Appeals [1996] 1 CLJ 393 and Russel v. Northen Bank Development Corp Ltd [1992] BCLC 1016)" - Emphasis added [48] I refer to the High Court decision in the case Concrete Parade Sdn Bhd v. Apex Equity Holdings Bhd & Ors [2020] 6 CLJ 684, which the Federal Court had affirmed the orders made by the High Court and set aside the Court Appeal decision recently in Dato' Azizan Abd Rahman & Ors v. Concrete Parade Sdn Bhd & Ors And Other Appeals [2024] 5 CLJ 193, FC. Justice Azizul Azmi Adnan, J discussed as follows: [14] The general principle for the governance of companies is majority rule. This principle is, unsurprisingly, subject to established exceptions: for example, parties are free to modify the operation of the principle of majority rule by contract. Hence, not infrequently, shareholders' agreements will provide for "reserved matters" that may only be approved with unanimity or by supermajority assent. Another example is s. 346, which is a statutory intrusion into the principle of majority rule. The law recognizes that, in certain circumstances, the powers of a company may be exercised in manner that is commercially unfair to a party who does not wield control over the fate and direction of the company, most usually a minority shareholder. In such cases, the law provides for wide powers of the court to provide relief to the oppressed. [15] Thus, if the affairs of a company or the powers of its directors are being exercised in an oppressive manner or in disregard of the interests of a member or debenture holder, or an act has taken place or is threatened that unfairly discriminates against or prejudices a member or debenture holder, the jurisdiction of the court to grant its wide-ranging relief under s. 346(2) would be triggered. [16] In order to establish a case under s. 346, a complainant must prove oppression, disregard or unfair discrimination or prejudice. There must exist commercial unfairness, or in the words of Lord Wilberforce in Re Kong ThaiSawmill - a visible departure from the standards of fair dealing and a violation of the conditions of fair play - before a case can be made. [17] The difference between ss. 346(1)(a) and 346(1)(b) is that the former is concerned not with particular acts but the manner in which the affairs of a company are being conducted generally, whereas the latter relates to specifically identifiable acts, whether actual or threatened. Despite the use of the present tense in s. 346(1)(a) - "are being conducted" and "are being exercised" - it is open to the court to find that oppression exists if past conduct suggests that a tendency or propensity to oppress or discriminate exists at the time of the proceedings. A case for oppression can be made even if it emanates from a single act or omission, for as long as the effects of that single act or omission are such that they persist at the date of the suit. [18] Whether or not there was oppression, disregard, unfair discrimination or prejudice in any particular case must be determined from the facts of each case. Accordingly, a particular act in the context of one case may be held not to be oppressive conduct, but that same act in the circumstances of a different case may well be. In this regard, case law would be useful for the principles that were considered and applied, but the decision in each case must be arrived at based on the particular facts of that case. [19] The test for unfairness is an objective one. The court must determine whether reasonable directors possessing the skills, knowledge, acumen and experience of the directors would have decided that a proposed course of action was unfair. That the directors may act honestly in the best interest of the company is not sufficient to exculpate them; the court must still apply the reasonable director test to ascertain the fairness of the conduct: Winds Ridge Farms Ltd v. Quadra Group Investments. [20] The rights of a member or debenture holder under s. 346 accrues to that member or debenture holder personally. It is not a right exercisable by a member on behalf of the company of which he is a member. As such, where the conduct complained of is unlawful or amounts to a breach of a duty owed to the company, a member may only seek to invoke s. 346 where that unlawfulness or breach of duty also causes oppression of, unfair discrimination against, or prejudice to, the member. Without the element of unfairness or prejudice to the rights of the complainant qua member of the company, the breach of a duty that is owed to the company is only actionable by the member through the derivative action procedure." - emphasis added Analysis and Findings [49] First and foremost, undisputedly, both Plaintiff and D1 are holding an equal share in D2. Therefore, this is not the typical case of a minority shareholder/s alleging an act or series of acts by the majority shareholder/s acting in disregard or not in the best interest of the company. [50] The Plaintiff advanced a list of instances of the alleged oppressive conduct by D1. The series of acts pleaded in this claim, which, according to the Plaintiff, constitutes oppression, were summarized as follows:

D1 has attempted to force Plaintiff to transfer his 50% shares in D2 company without any compensation.

Plaintiff alleged removal from D2's WhatsApp group was based on D1 instructions, resulting in Plaintiff having no access to D2 management and money transactions.

Plaintiff was chased out from D2 company premises.

D1 failed to act in the company's best interest (D2) – referring to instances as discussed later in this judgment. [51] I have considered either each and every instances complained or based on similar factual events narrated by Plaintiff to see whether D1's conduct amounts to oppressive conduct under s.346 of the Act 2016. [52] Before I go into the details, having reviewed the affidavits relating to the circumstances of this case, it was undeniable that both parties were in a difficult marital crisis at the relevant time. Both are accusing each other of temper tantrums, which to some extent has led to marital aggression and unbalanced reasoning in decisions affecting the interest of the business. [53] D1 accused the Plaintiff of sexually harassing his coworkers, and a police report was filed. The Plaintiff denied the allegation and avers that the allegation was unfounded as no criminal charges had been brought against him. It is understandable that this does not diminish D1's hesitation towards the Plaintiff. [54] Having equal control of the company, Plaintiff retaliated by deliberately refusing to approve any financial claims made by D1 and letting D1 singlehandedly manage D2 without support. [55] From the narration given by Plaintiff, I find that the situation arose because Plaintiff and D1 misunderstood each other and allowed hatred towards them, resulting in not being able to be on the same wavelength in making decisions about the day-to-day running of the business. If anything, I would consider any action by D1 that was disapproved of by the Plaintiff to be mismanagement by D2 that appears not in the best interests of both parties. [56] Was action purportedly taken by D1 considered as managing D2 in an oppressive manner that has affected Plaintiff's right as the shareholder of the company? [57] I am of the view that D1's request for Plaintiff to transfer 50% of his shares was merely a suggestion or another way of looking at it, a mere consequence of domestic grudge and resentment felt by both D1 and Plaintiff. He was not forced or threatened in any way, as Plaintiff still had the power or ability to refuse or turn it down, which he did. [58] As for the allegation of sexual harassment towards D2's employee, a police report has been lodged, and even though no criminal charge has been preferred, it does not mean nothing has happened. Still, Plaintiff managed to hold on to his shares and has not transferred the same to D1 to date. [59] It was alleged that Plaintiff refused to attend board meetings and refused to authorize payments for employees' salaries, allowances and other payments. It was not disputed that Plaintiff controlled the company's finances, and this task is no small responsibility. This all the more justified the fact that Plaintiff was not oppressed in any way, even though the alleged action of D1 seems to be against the interest of the company. [60] In my view, the fact that D1 exposes herself to allegations of mismanagement by allowing former employees to complain to the Industrial Relation Department and agreeing to the payment of arrears does not entitle the Plaintiff to reliefs under s.346. [61] I refer to the case of Khor Lye Hock & Anor v Makassar Engineering & Construction Sdn Bhd (2011) 8 CLJ 476, where it was discussed by Justice Nallina Patmanathan (as she then was) on s.181 of Companies Act 1965 which is in pari materia with the present S.346 as follows: [10] It is a principle of the law relating to the grant of relief under s. that mismanagement in itself is not actionable. Disputes relating to policy or management do not entitle a member to relief under the section. More significantly the oppression in question must affect the petitioning member qua member. The acts complained of must affect the member in his capacity as a member, (see Re Chi Liung & Son Ltd; Tong Chong Fah v. Tong Lee Hwa & Ors [1967] CLJU 145; [1967] 1 LNS 145 and In The Matter Of Tong Eng Sdn Bhd [1994] 2 CLJ 775 per Selventhiranathan J. Prayer (a): This prayer relates to the removal of P1 as a Managing Director. It seeks to cancel the resolution dated 15 May 2009 that removed P1 as Managing Director. The complaint here and relief sought relates to P1's contractual position as Managing Director. It does not relate to his rights as a member. The Board of Directors, moreover is empowered under art. 91 of Table A to remove P1. It is significant that he has not been removed as a director nor has any attempt been made to adversely affect his shareholding. In the matter of In The Matter Of Tahansan Sdn Bhd [1984] CLJU 1; [1984] 1 LNS 1, Chan J quoted Plowman J in Re Lundie Brothers Ltd[1965] 1 WLR 1051: ... In my judgment he has wholly failed to do that. His main grievance is, as he admitted in the witness box, that he has been ousted as a working director. That, it seems to me, has nothing to do with his status as a shareholder in the company at all. The same thing is equally true in regard to his complaint that his remuneration as a director of the company has been reduced. That relates to his status as a director of the company, and not to his status as a shareholder of the company. Chan J then went on to hold: The fact that the petitioner in the present case was ousted as a director and that he was deprived of his directors' remuneration relates only to his status as a director, and not to his status as a shareholder. The court, therefore is not given jurisdiction in a situation like this to make an order under section 181." - emphasis added [62] The same goes for the act of D1 removing Plaintiff from the company's WhatsApp group and not challenging garnishee proceedings in order to allow ex-employees to benefit from the garnished amount, which was, though a cunning act by D1 in order to bypass Plaintiff's approval for the survival of the company, it cannot be said as an intention to oppressed the Plaintiff within the meaning of s.346 of the Act. [63] I agree with Defendants that Plaintiff had and still has direct access to all documents via the company's online banking system, the accountant, and the company secretary to reach out for any information on the financial status of the company. [64] However, D1 act of incorporating D3 may suggest not for the best interest of D2, but as she explained, the reason she attempted to terminate/cease the operation of D2 was due to Plaintiff not approving payments to EPF, SOCSO and LHDN, which was a non-compliance with the law. Even if Plaintiff was dissatisfied with D3 incorporation, it does not fall under oppression, but it is more likely that he would be able to proceed with other remedies available under other relevant provisions of the law. [65] Going back to the issue of Plaintiff being a 50% shareholder of D2, it was submitted that he has no locus standi to file a case under s.346 as the section was only applicable where a minority within a class has been oppressed by the majority of that class. For this reason, Defendants relied on the case of The Bank of Nova Scotia Bhd & Anor v Lion Dri Sdn Bhd (2020) MLJU 1987. [66] I am of the opinion that s.346 clearly states that "any member" of the company is allowed to bring an action under this section. However, I am guided by the Federal Court case of Auspicious Journey Sdn Bhd v Ebony Ritz Sdn Bhd & 5 Ors [2021] 3 AMR 777, in the words of Justice Nallini Pathmanathan FCJ it was held as follows: "… Section 181 (now s 346) provides for the broad involvement of the courts in fashioning a wide-ranging series of remedies for the beleaguered shareholder/s who are able to establish oppression, prejudice or discriminatory acts or omissions by those in control, generally the majority. … … oppression, it should be borne in mind, is a minority shareholder remedy against those controlling the company. That will naturally include the directors who manage the company at the behest of the majority, as well as the majority itself. Therefore, relief against the directors is a natural and logical consequence, if they have indeed behaved oppressively to the minority. This is so by reason of the express provisions of s 181." [67] Therefore, I am of the view that the burden of proof of being oppressed within the meaning of S.346 lies on the Plaintiff, and being merely dissatisfied with policy or management decisions is insufficient to show that Plaintiff is being oppressed as a shareholder of the company or his interest have been compromised or unduly prejudiced by D1's decisions and actions. Having equal power in the running of the clinic, especially in finance matters, puts more weight on Plaintiff to show evidence of oppression, and he is not in the category of a minority shareholder whose interests are likely to be prejudiced if decisions were made improperly. Conclusion [68] Having heard both parties, taking into account the entirety of the circumstances as set out above, I find that Plaintiff had failed to prove, on a balance of probabilities, that the actions and conduct of D1 as alleged amounted to oppression pursuant to s. 346 of the Act. Final order [69] Therefore, Plaintiff's application is hereby dismissed with a cost of RM15,000 subject to the allocator fee. Dated this: 23rd December 2024 ~ signed ~ (NOOR HAYATI BINTI HAJI MAT) Judge Shah Alam High Court NCVC 9 Counsels: For the Plaintiff: Renuka Krishnasamy together with Goh Jia Yee Messrs V. Samy Renu & Co. For the Defendant: Sreedhara Naidu together with Khairina Abd Malik