Shaharuddin Ali together with Muhd Noor Azfar for the Respondent v Lau Zhong Yan together with Ryan Chu Soon Wei for the Petitioner (PENGGULUNGAN SYARIKAT NO: WA-28NCC-8-01/2020)

An Affidavit In Opposition had been filed by the Respondent in this Petition on 14.8.2020 i.e 11 days before the 3rd hearing date of the Petition.

On 2.11.2017 Judgment was given against the Respondent at the High Court of Sabah and Sarawak at Sibu. The Respondent had attempted to set aside the Judgment but the same was dismissed by the High Court of Sabah and Sarawak at Sibu on 16.8.2018.

An appeal was then made by the Respondent to the Court of Appeal against the High Court’s decision in dismissing the striking out application which was also unanimously dismissed by the Court of Appeal on 28.6.2019 with costs of RM2,000.00.

4 months after the dismissal by the Court of Appeal, the Respondent filed a notice of motion to apply for an extension of time to apply for leave to appeal to the court of Appeal.

When the matter came up for hearing on the second occasion before this court on 4.8.2020, the Respondent’s counsel had 3 informed this court that they had filed a Notice of Motion for an adjournment of the matter vide enclosure 20 (Motion) and that they were not opposing the Petition but merely seeking for the Motion to be heard first whereby the Court then fixed for the Petition to be heard on 25.8.2020 together with the Motion thereto which, consequently had to be refiled.

On 25.8.2020, the Petition and the Motion came up for hearing before this Court but was adjourned to 8.9.2020 as the Respondent’s counsel was ill and unable to be present in court on that day.

When the matter came up for hearing on 25.8.2020, the Respondent’s counsel informed this Court that they were withdrawing the Motion whereby the Court then struck off the Motion with costs and proceeded to hear the respective parties counsels submit on the Petition itself. After hearing the respective submissions, the court adjourned the matter for decision to the 27.10.2020.

The Petitioner had at the outset of the hearing of the Petition, objected to the Affidavit In Opposition (AIO) filed by the Respondent at enclosure 24 and submitted that it should be disregarded completely for the following reasons: a) the Petition was fixed to be heard on 25.8.2020 and the AIO was sent via email to the Petitioner’s solicitors on 14.8.2020 at 6.54 4 p.m. In the email the Respondent’s solicitors had indicated that the hardcopy of the AIO would be served on the Petitioner’s solicitors which only took place on 19.8.2020 which was in breach of rule 30(1) of the Companies (winding Up) Rules 1972; b) the AIO was served only on 19.8.2020 which was 6 days before the hearing of the Petition c) the deponent of the AIO, one Nik Suhaimi Bin Nik Li has no authority to affirm the AIO on the Respondent’s behalf as he is not a director of the Respondent d) the Respondent’s contention that there is a notice of motion to oppose the Petition is false e) references to the contesting of the Judgment by the Respondent do not exist and that exhibit NS-3 referred to in the AIO are incomplete and do not show the date of the correspondences

I will firstly deal with the AIO filed by the Respondent on 14.8.2020. From the facts before me the hardcopy of the said AIO was only served on the Petitioner’s Solicitors on 19.8.2020.

Pursuant to Rule 30(1) of the Companies (Winding Up) Rules 1972 which provides: 5 “(1) Affidavits in opposition to a petition that a company may be wound up shall be filed and a copy thereof served on the petitioner or his solicitor at least seven days before the time appointed for the hearing of the petition.’

The said rule 30(1) of the Companies (Winding Up) Rules 1972 thus requires that not only is the AIO to be filed at least 7 days before the time appointed for the hearing of the Petition but the said AIO is also to be served on the petitioner or his solicitor within the said time period and which is in my view a mandatory requirement of which authority for this can be found in Gulf Business Construction (M) Sdn Bhd v .. [2010] 8 CLJ 775 as well as Juara Aspirasi (M) Sdn Bhd v Tan Soon Peng [2012] 1 MLJ 50, both of which are Court of Appeal decisions, where in the latter case the Court of Appeal had stated and held: “[8] On the technical point raised of non compliance by the company of r 30(1)of the Companies (Winding-Up) Rules 1972 of failing to file an affidavit in opposition to the petition, we agree with the submission of counsel for the petitioner that the failure to do so was fatal. See Crocuses & Daffodils (M) Sdn Bhd v Development & Commercial Bank Bhd [1997] 2 MLJ 756 where Siti Norma JCA (as she then was), r 30(1) to be mandatory. Rule 30(1) states as follows: • (1)Affidavits in opposition to a petition that a company may be wound up shall be filed and a copy thereof served on the petitioner 6 or his solicitor at least seven days before the time appointed for the hearing of the petition.”

As the said AIO was only served on the Petitioner’s solicitors 6 days prior to the hearing of the Petition, I hold that the service of the AIO was not done in accordance with Rule 30(1) of the Companies (Winding Up) Rules 1972 and therefore is to be deemed as not being filed and served as required by the Rules and should thus be disregarded by this Court for the purposes of the Petition herein

In respect of the Judgment, I find that the Judgment has not been set aside or varied and is therefore to be obeyed as held by the Court of Appeal in Pacific & Orient Insurance v Munniamah Muniandy [2011] 1 CLJ 947 where Ramly Ali JCA (as he then was) stated that: “A valid and enforceable judgment of court as in the present case, (unless set aside or stayed) cannot be considered a disputed debt. The law is settled on this point.”

It is clear from the Petitioner’s affidavit in reply at paragraph 7.2 to 7.6 of enclosure 27 that the Respondent had attempted to set aside the Judgment but the same was dismissed by the High Court of Sabah and Sarawak on 16.8.2018 and that a further appeal on the said decision was also dismissed unanimously by the Court of 7 Appeal on 28.6.2019. Leave for an extension of time to file a further appeal to the Court of Appeal on the same was also dismissed.

It is therefore clear to this Court that the issues with regards the Judgment has been fully ventilated

On that premise, the Petitioner is entitled to file this Petition and the Judgment therein is to be considered an undisputed debt. Respondent being unable to pay its debts

This Court also notes that the statutory notice dated 8.10.2019 was issued by the Petitioner to the Respondent pursuant to section 466(1)(a) of the Companies Act 2016 on 8.10.2019, see the Statutory Declaration of the Respondent exhibited in exhibit JS-5 of the Petition, and that after a period of 21 days , the Respondent had failed to pay the same thereby of which the Respondent is deemed unable to pay its debts.

As there is no valid AIO before this Court, there are no issues or substantial disputes which can or has been raised before me.

I also find that the Respondent has consequently failed to raise any evidence as to its financial position and therefore its solvency for the consideration of this Court in accordance with Section 466 (1) CA 2016 and to rebut the presumption that it is ‘commercially insolvent’ in that a C ompany must prove that its able to pay its debts as per 8 the judgment of the Supreme Court in Sri Hartamas Development Sdn Bhd v MBf Finance Bhd [1992] 1 CLJ (Rep) 303 which held that: “In dealing with "commercial insolvency", that is, of a company being unable to meet current demands upon it, we would respectfully follow the Privy Council in the Malayan Plant case and cite the following observations from Buckley on the Companies Act (13th Edn.) at p. 460: In such a case it is useless to say that if its assets are realized there will be ample to pay twenty shillings in the pound: this is not the test. A company may be at the same time insolvent and wealthy. It may have wealth locked up in investments not presently realizable; but although this be so, yet if it have not assets available to meet its current liabilities it is commercially insolvent and may be wound up.”

In the Respondent’s submissions before me, the Respondent had raised the issue of the jurisdiction of the High Court of Sabah and Sarawak to order the Judgment. For what it is worth, this court notes that the Respondent had submitted to the jurisdiction of the High Court of Sabah and Sarawak when it had made the attempts to set aside the Judgment as mentioned earlier.

I also make reference to section 23 (1) of the Courts of Judicature Act 1964 which states that 9 “(1) Subject to the limitations contained in Article 128 of the Constitution the High Court shall have jurisdiction to try all civil proceedings where:

the cause of action arose;

the defendant or one of several defendants resides or has his place of business;

the facts on which the proceedings are based exist or are alleged to have occurred; or

any land the ownership of which is disputed is situated, within the local jurisdiction of the Court and notwithstanding anything contained in this section in any case where all parties consent in writing within the local jurisdiction of the other High Court.”

The wordings of the said sub section(1) (a) to (d) in section 23 of the Courts of Judicature Act 1964 are in my view to be read ‘disjunctively’ by the use of the word ‘or’ which appears therein and I find support for this proposition in the case of RHB Bank Bhd v Kawood Sdn Bhd & Ors and Anor Suit [2001] MLJU 690 where Clement Skineer J (as he then was) held a similar view.

In any event, after hearing, reading and considering the respective parties counsels submissions on this issue, I hold that such an issue with regards the jurisdiction of High Court of Sabah and Sarawak with regards the Judgment is and should be decided by a civil court and not a winding up court and accordingly this Court will not address this issue further other than to make my observation above. 10

As this Court had earlier found that there is no AIO filed before this Court, there is thus no opposition facing the Petition and after giving proper consideration to the issues raised and the facts as stated in the Petition, this Court hereby grants order in terms for prayer 10 (i)

(ii) and (iii) enclosure 1. Dated: 21st December 2020 sgd. NADZARIN WOK NORDIN JUDICIAL COMMISSIONER KUALA LUMPUR HIGH COURT Parties: Lau Zhong Yan together with Ryan Chu Soon Wei for the Petitioner [Messrs Chooi & Company + Cheang & Ariff] Shaharuddin Ali together with Muhd Noor Azfar for the Respondent [Messrs Shaharudinali Azfarazmi & Co.]