[82] The Plaintiff's subsequent conduct in making the Third Payment Milestone on 22.10.2024, ahead of the scheduled due date of 31.10.2024, despite having received these statutory notices, cannot retrospectively cure the initial breach or create a waiver of the Defendant's rights, which had already crystallised upon the breach of the Second Payment Milestone terms. [83] This is particularly significant as the Defendant had expressly objected to the late payment through their letter dated 9.8.2024, making their position clear immediately after the breach occurred. [84] As noted during the oral hearing before this Court on 21.6.2025, there was no explanation provided for the late payment at the time it occurred, nor was any written request made for the grace period as explicitly required under Clause 8 of the Settlement Agreement. [85] The Settlement Agreement was entered into in the context of resolving substantial litigation regarding ship management services for the vessel "MV Berkat Tuah," with the Defendant agreeing to a significant discount of approximately RM3 million from the Original Outstanding Sum of RM10,375,399.37 to the Settlement Sum of RM7,200,000.00. [86] This substantial reduction, representing nearly 30% of the original debt, underscores why strict compliance with payment terms was essential to maintaining the discount and formed the commercial basis of the agreement. [87] The payment structure, comprising an initial payment followed by four milestone payments, was carefully negotiated to provide the Plaintiff with manageable instalments while protecting the Defendant’s interests through specific default provisions. [88] The Defendant's legitimate expectation of timely payments, as stated in paragraph 30 of their affidavit, was entirely reasonable given the substantial concession already granted to the Plaintiff. This concession was incorporated into the Consent Judgment dated 30.4.2024, which made the Settlement Agreement's terms binding on both parties. [89] I therefore find that the breach need not be substantial to trigger Clause 12, and in any event, the Plaintiff's failure to adhere to the payment schedule without explanation or proper request for grace period constituted a breach sufficient to trigger the clause. The Defendant's acceptance of subsequent payments does not negate their clearly communicated assertion of rights under the Settlement Agreement. The Nature and Effect of the Written Notice Requirement [90] The Plaintiff argues that the failure to provide written notice for utilising the 21-day grace period was merely a procedural lapse that should not trigger the severe consequence of reverting to the Original Outstanding Sum. The Plaintiff characterises the written notice requirement as a warranty or procedural obligation rather than a fundamental condition of the contract. [91] The Defendant submits that Clause 8 of the Settlement Agreement makes the grace period contingent upon two conditions: a written request from the Plaintiff and the Defendant's discretion to allow such extension. The Defendant maintains that without satisfying these conditions, the grace period is not available to the Plaintiff, and the late payment constitutes a breach triggering Clause 12. [92] Examining Clause 8 of the Settlement Agreement, its language is clear and unambiguous: “HMSSB may allow a grace period of twenty-one (21) days from the due date for payment to pay the stipulated sum upon the request of such grace period in writing from SMPL.” The use of the word “may” and the phrase “upon the request” establishes two distinct requirements: first, that the grace period is discretionary, and second, that it must be formally requested in writing. [93] The evidence shows that the Plaintiff made no attempt to comply with the written notice requirement before making the late payment on 8.8.2024. [94] During oral submissions, when specifically questioned by the Court about the absence of any explanation for the late payment, the Plaintiff's counsel confirmed that no written request was made at the time. [95] The Court records reveal that despite having ample opportunity to request the grace period in writing as stipulated under Clause 8 of the Settlement Agreement, no documentary evidence was presented showing any communication from the Plaintiff to the Defendant regarding the anticipated delay between 31.7.2024 and 8.8.2024. [96] The Defendant's letter of 9.8.2024 objecting to the late payment further confirms that no prior notice or explanation had been provided, a fact which remained uncontested throughout the proceedings and was ultimately acknowledged by the Plaintiff's counsel during the hearing on 21.6.2025. [97] The characterisation of the written notice requirement as merely procedural ignores its essential role in the agreement's payment mechanism. The requirement serves a substantive purpose - it allows the Defendant to exercise its discretion in granting the grace period and to make informed commercial decisions based on the Plaintiff's payment capabilities. This is particularly significant given that the Settlement Agreement represents a substantial discount from the Original Outstanding Sum of RM10,375,399.37 to RM7,200,000.00. [98] The Court of Appeal in Small Medium Enterprise Development Bank Malaysia v Lim Woon Katt emphasised that in commercial matters, failure to respond to or comply with formal requirements can have serious consequences. The court noted that businesses are expected to honour their contractual obligations, particularly regarding payment terms and associated procedures. [99] The Defendant's position is further strengthened by their prompt objection through the letter dated 9.8.2024, asserting their rights under the agreement. The Plaintiff's subsequent conduct in making the Third Payment Milestone ahead of schedule cannot retrospectively cure the fundamental failure to comply with the written notice requirement. [100] I therefore find that the written notice requirement was not merely procedural but formed an integral part of the payment mechanism under the Settlement Agreement. The Plaintiff's failure to comply with this requirement means they cannot avail themselves of the grace period, and consequently, the late payment constitutes a breach triggering Clause 12 of the agreement. The Availability of Alternative Remedies [101] The Plaintiff contends that the Defendant has alternative remedies available besides winding-up proceedings, such as garnishee proceedings. The Plaintiff argues that the Defendant's choice to pursue winding-up proceedings despite being an unsecured creditor with lower priority than secured creditors demonstrates the oppressive nature of their actions. [102] The Defendant submits that they are entitled to choose their mode of enforcement, and that winding-up is a legitimate means of enforcing a judgment debt. The Defendant maintains that there is no legal requirement to exhaust other remedies before pursuing winding-up proceedings, particularly where the debt arises from a consent judgment. [103] The Court of Appeal in Zalam Corporation Sdn Bhd v Dolomite Readymixed Concrete Sdn Bhd [2011] 9 CLJ 705 has clearly established that where a statutory notice is based on a final judgment and an application to stay such judgment has been refused, there exists a judgment debt that must be paid by the plaintiff to the defendant. The existence of any disputed counterclaim that has not been decided cannot be accepted as grounds for refusing to comply with the statutory notice. The court specifically held that “notis statutori yang dikemukakan kepada plaintif adalah berlandaskan kepada suatu penghakiman muktamad dan permohonan penggantungan penghakiman tersebut juga telah ditolak. Justeru, telah wujud suatu hutang penghakiman yang kena dibayar oleh plaintif kepada defendan pertama.” Furthermore, the court emphasised that a petition to wind up a company based on a valid judgment is not an abuse of court process, and issues related to the company's solvency are more appropriately determined in the winding-up proceedings themselves rather than at the injunction stage. [104] Significantly, Clause 11 of the Settlement Agreement expressly contemplates winding-up as a potential remedy, stating that “HMSSB shall be entitled to claim, via legal proceeding, not limited to winding up action, for the whole sum of RM10,375,399.37.” This demonstrates that winding-up proceedings were specifically envisaged by the parties as a possible enforcement mechanism. [105] The Court of Appeal in Pacific & Orient Insurance held that execution is a natural process after obtaining judgment and winding-up is one of them. The court specifically noted that fears of losing business, customers, suppliers, or goodwill are not special circumstances that would prevent winding-up proceedings. [106] The Defendant's status as an unsecured creditor does not preclude them from pursuing winding-up proceedings. As held by the Court of Appeal in Kumpulan Liziz, a company may be wound up for an undisputed debt where the debtor is unable to pay or compromise to the satisfaction of the creditor. [107] The evidence shows that the Defendant first issued a letter of demand on 9.8.2024, followed by statutory notices dated 23.8.2024 and 28.8.2024. This demonstrates a methodical approach to enforcement rather than oppressive conduct. The Plaintiff's suggestion that the Defendant must pursue other remedies first finds no support in law or the Settlement Agreement. [108] I therefore find that the availability of alternative remedies does not preclude the Defendant from pursuing winding-up proceedings, particularly where such proceedings were expressly contemplated in the Settlement Agreement and the debt arises from a consent judgment. The Defendant's choice of remedy cannot be characterised as oppressive merely because other enforcement options exist. The Issue of Solvency and Abuse of Process [109] The Plaintiff contends that pursuing winding-up proceedings against a solvent company over a disputed debt constitutes an abuse of process. The Plaintiff points to its continued compliance with financial obligations, including making the Third Payment Milestone payment ahead of schedule on 22.10.2024, as evidence of its solvency and ability to honour the Settlement Agreement. [110] The Defendant submits that where a judgment debt exists, the question of solvency is irrelevant at this stage and should be determined in the winding-up proceedings proper. The Defendant maintains that pursuing a winding-up petition based on a judgment debt cannot constitute an abuse of process. [111] The Court of Appeal in Zalam Corporation has definitively addressed this issue. The court held that it is more appropriate to decide the issue of solvency in the winding-up proceedings itself as it constitutes a defence that can be raised in such proceedings. Furthermore, the court emphasised that a winding-up petition based on a valid judgment is not an abuse of court process. [112] The evidence before this court shows that the debt arises from a Consent Judgment dated 30.4.2024, which remains valid and has neither been set aside nor stayed. In such circumstances, the Court of Appeal in Pacific & Orient Insurance held that fears of losing business or concerns about solvency are not special circumstances warranting intervention. The court notably observed that rich companies who did not pay their debts had only themselves to blame if it were thought that they could not pay them. [113] The Plaintiff's continued payment of subsequent milestones does not negate the fact that there was a breach of the payment terms that triggered Clause 12 of the Settlement Agreement. As held in Kumpulan Liziz, until a judgment is set aside or stayed, the judgment debt remains undisputed, and should the debtor be unable to pay or compromise to the satisfaction of the creditor, a winding-up petition may be presented. [114] The Court of Appeal in Zalam Corporation has definitively addressed this issue. The court held that the learned judge had overlooked the fact that the plaintiff had still not satisfied the defendant's statutory notice based on a valid judgment that had not been stayed. The petition was for a legitimate purpose of pressing for payment of a valid judgment debt and not for any collateral purpose. The court specifically found that “hakim yang bijaksana telah terlepas pandang bahawa plaintif masih lagi belum memuaskan tuntutan statutori defendan pertama yang berasaskan suatu penghakiman sah yang tidak digantung perlaksanaannya.” The court further emphasised that it was “ternyata kepada kami bahawa petisyen yang dimaksudkan itu adalah untuk tujuan yang sah bagi mendesak pembayaran suatu hutang penghakiman yang sah dan bukannya untuk tujuan kolateral yang lain.” This supports the principle that a creditor's legitimate right to pursue statutory remedies for an undisputed judgment debt should not be impeded. [115] I therefore find that the Plaintiff's claims of solvency and continued payments are matters more appropriately addressed in the winding-up proceedings itself. The pursuit of winding-up proceedings based on a judgment debt cannot constitute an abuse of process, regardless of the debtor company's claimed solvency. This finding is particularly apt where, as here, the Settlement Agreement explicitly contemplated winding-up as a potential remedy in Clause 11. The Service of the Statutory Notice [116] The Plaintiff contends that service of the statutory notice was defective as it did not comply with Section 466(1)(a) of the Companies Act 2016, which requires notices to be left at the company's registered office. The Plaintiff argues that service by registered post does not satisfy this statutory requirement. [117] The Defendant submits that service was properly effected through two channels: by hand delivery to the Plaintiff's Business Address and by registered post to the registered office at the Registred Address, received on 4.9.2024. The Defendant maintains that the Plaintiff has acknowledged receipt of both notices and has suffered no prejudice from the mode of service. [118] The evidence before this court demonstrates that the Defendant took comprehensive steps to ensure effective service. The affidavit evidence shows that the statutory notice dated 28.8.2024 was delivered by hand to the Plaintiff's Business Address, and was acknowledged with the company's stamp as confirmed in Exhibit AS-2 of the Defendant's Affidavit in Reply. Additionally, a statutory notice dated 23.8.2024 was sent by registered post to the Plaintiff's Registered Address, which was received on 4.9.2024 as evidenced by the tracking confirmation attached collectively as Exhibit AS-3. The registered address was properly obtained through a Real Time Search of Company Status from the Labuan Financial Services Authority (“LFSA”) dated 21.8.2024, a copy of which was exhibited as AS-4 in the Defendant's Affidavit. The Defendant's diligent approach in employing dual methods of service demonstrates a genuine intention to comply with the statutory requirements for notice under Section 466 of the Companies Act 2016. [119] In Badan Pengurusan Bersama Anson Apartment v CTS Properties Sdn Bhd [2019] MLJU 1268, the High Court held that even if service of notice was contested, where a company has filed an affidavit opposing the petition and is well aware of the case against it, any irregularity in service does not prejudice it. The court specifically stated: “Even if the Respondent were to contest service of the notice, the Court has held that the Company which has filed Affidavit Opposing Petition is well aware of the case against it and any irregularity in service does not prejudice it.” The court cited ET Mix Sdn Bhd v Sun Steel Construction Sdn Bhd [2005] 5 MLJ 248 (HC), which established that when a respondent has entered an appearance and filed various affidavits, they clearly knew the case against them and were not prejudiced by any alleged defect in service, with the High Court in that case remarking: “The respondent knew what was the case against them. The respondent was not prejudiced at all even if the notice of demand was not properly served.” [120] In the present case, the Plaintiff has not denied receiving the notices. Indeed, the Plaintiff has actively participated in these proceedings, filing substantial affidavits addressing the merits of the case. The Plaintiff's ability to mount a comprehensive defence demonstrates that they were not prejudiced by the method of service. [121] The Defendant's dual approach to service - both by hand delivery and registered post - shows a genuine attempt to ensure the Plaintiff received proper notice. This stands in contrast to cases where service is entirely lacking or where notices are sent to incorrect addresses. The fact that the notices reached both the Plaintiff's business address and registered office fulfils the underlying purpose of Section 466(1)(a), which is to ensure the company receives actual notice. [122] I therefore find that while strict compliance with Section 466(1)(a) may be desirable, any technical defect in service has not prejudiced the Plaintiff and does not warrant the granting of an injunction. This finding aligns with the modern approach to civil procedure where substance is preferred over form, particularly where there is clear evidence that the purpose of the statutory requirement - actual notice to the company - has been achieved. The Issue of Irreparable Damage [123] The Plaintiff argues that the presentation of a winding-up petition would cause irreparable damage to its business reputation, banking facilities, and commercial relationships. The Plaintiff contends that such consequences would be disproportionate given that the underlying dispute arose from a mere 8-day delay in payment that caused no demonstrable financial loss to the Defendant. [124] The Defendant submits that concerns about potential damage to business reputation or commercial relationships are not grounds for restraining a winding-up petition based on a judgment debt. The Defendant maintains that such consequences are the natural result of enforcement proceedings and can be avoided by paying the debt. [125] The Court of Appeal in Pacific & Orient Insurance has directly addressed this issue, citing Ming Ann Holdings Sdn Bhd v Danaharta Urus Sdn Bhd [2002] 3 MLJ 49. The court held that grounds such as fear of losing business, customers, suppliers, goodwill, or the ability to collect debts from third parties are “nothing more than 'fear of losing’” and do not constitute special circumstances warranting an injunction. The court emphasised that “all a company has to do to avoid such 'fears' is to settle the judgment debt” and that “execution is a natural process after obtaining a judgment and winding-up is one of them.” [126] This principle was reinforced in Zalam Corporation, where the Court of Appeal held that there was nothing in the plaintiff's affidavit demonstrating that it would suffer any loss that would be difficult to remedy if the defendant was allowed to proceed with the winding-up petition. The court stressed that such matters are more appropriately addressed in the winding-up proceedings themselves. [127] The evidence before this Court shows that the Plaintiff was well aware of the potential consequences when entering into the Settlement Agreement. [128] Clause 11 explicitly contemplated winding-up as a potential remedy, stating that: “In the event that SMPL fails to abide by the payment terms in accordance with Clause 2 or Clause 8 above, HMSSB shall be entitled to claim, via legal proceeding, not limited to winding up action, for the whole sum of RM10,375,399.37.” [129] Furthermore, Clause 12 provided for the reinstatement of the Original Outstanding Sum upon breach, with the clear wording that: “All such part of the Original Outstanding Sum remains unpaid by SMPL to HMSSB, including all such part of the Original Outstanding Sum which is then not due for payment under Clause 2 or Clause 8, shall become immediately due and payable by SMPL to HMSSB, without any demand by HMSSB.” [130] These clauses were negotiated and accepted by both parties as part of a substantial discount arrangement, reducing the Original Outstanding Sum of RM10,375,399.37 to the Settlement Sum of RM7,200,000.00. [131] The Plaintiff, represented by competent legal counsel during these negotiations, therefore accepted these potential consequences as part of the bargain when agreeing to these terms, and cannot now claim to be surprised by their enforcement. [132] The Defendant's conduct in this matter has been methodical and proper throughout the enforcement process. [133] Following the late payment on 8.8.2024 (which was eight days after the contractually stipulated deadline of 31.7.2024), the Defendant promptly issued a letter of demand on 9.8.2024, clearly objecting to the late payment and asserting their rights under Clause 12 of the Settlement Agreement. [134] This was followed by properly served statutory notices dated 23.8.2024 and 28.8.2024 to both the Plaintiff's Registered Address and their Business Address, as evidenced by documented acknowledgements of receipt. [135] At each stage, the Defendant provided clear notice of their intention to enforce their rights under the Settlement Agreement and the Consent Judgment. [136] This demonstrates a reasonable, transparent and measured approach to enforcement, rather than an attempt to cause unnecessary harm to the Plaintiff's business, particularly as the Defendant was acting in accordance with their contractual rights explicitly contemplated in the Settlement Agreement that formed part of the Consent Judgment. [137] I therefore find that the potential damage cited by the Plaintiff, while undoubtedly serious, does not constitute grounds for restraining a winding-up petition based on a judgment debt. This is particularly so where, as here, the remedy was expressly contemplated in the agreement and the alleged damage can be avoided by settling the debt. The proportionality of the consequences cannot override the Defendant's right to enforce a judgment debt through statutorily prescribed means. The Relevance of the Defendant's Discovery Application to the Fortuna Injunction [138] The Plaintiff contends that the Defendant's discovery application seeking corporate and financial information demonstrates a lack of sufficient information to determine the Plaintiff's solvency. This, according to the Plaintiff, undermines the statutory notice issued by the Defendant and reveals an improper use of the legal process. The Plaintiff particularly emphasises that this discovery application was filed after the affidavit evidence was exhausted, suggesting the Defendant is attempting to retrospectively justify their statutory notice. [139] The Defendant, through counsel Encik Mahmud during the oral hearing, explained that the discovery application was filed solely to obtain the Plaintiff's company profile from LFSA, as there is no publicly accessible system similar to the Companies Commission of Malaysia (“SSM”) for Labuan-incorporated companies. The Defendant maintains that this procedural requirement is distinct from the substantive issues concerning the Fortuna injunction and does not affect the validity of the statutory notice. [140] Having considered the submissions and evidence before me, I find the Plaintiff's argument on this point to be without merit. Firstly, it is important to note that the discovery application is not properly before this court as part of the present proceedings. As evident from the oral hearing notes, both the discovery application and the Plaintiff's proposed originating summons challenging the settlement agreement's breach are matters that arose after the affidavits were completed. These subsequent proceedings are not relevant to determining whether the requirements for a Fortuna injunction have been met. [141] More fundamentally, the Plaintiff's argument misconceives the nature and purpose of the discovery application. The Defendant has provided a clear and logical explanation that the discovery is merely a procedural requirement to obtain basic company information from LFSA, which is not otherwise publicly accessible. This stands in contrast to companies incorporated in Peninsular Malaysia, where such information can be readily obtained through SSM searches. The Defendant's need to follow proper procedures to obtain company information does not, in any way, undermine the validity of the statutory notice or suggest an abuse of process. [142] The Court of Appeal in Pacific & Orient Insurance Co Bhd v Muniammah Muniandy has established that where there is a valid and enforceable judgment, the debt cannot be considered disputed unless set aside or stayed. The existence of procedural steps, such as discovery applications, does not affect this principle. Here, there is a consent judgment dated 30.4.2024 which remains valid and enforceable. [143] Furthermore, the discovery application appears to be a responsible step by the Defendant to ensure all necessary documentation is in order before proceeding with the winding-up petition, rather than evidence of impropriety as suggested by the Plaintiff. This approach aligns with the proper administration of justice and cannot be construed as undermining the statutory notice or supporting the grant of a Fortuna injunction. [144] Accordingly, I find that the Plaintiff's arguments regarding the discovery application do not advance their case for a Fortuna injunction and must be dismissed. Conclusion [145] Based on my detailed analysis above, I find that the Plaintiff has failed to establish grounds for a Fortuna injunction. The debt in question arises from a valid Consent Judgment which incorporated the Settlement Agreement's terms, including the consequences of default. The Plaintiff's failure to comply with payment terms and the written notice requirement for the grace period triggered their liability for the Original Outstanding Sum under Clause 12. The fact that this arose from an 8-day delay does not negate the binding nature of these terms, which the Plaintiff freely agreed to as part of obtaining a substantial discount from the original debt. The Defendant's pursuit of winding-up proceedings based on this judgment debt cannot constitute an abuse of process, and fears of commercial damage are insufficient to restrain such proceedings where the debt can be avoided by payment. Any technical defects in service have not prejudiced the Plaintiff, who has fully participated in these proceedings. The matter of the Plaintiff's solvency is more appropriately addressed in the winding-up proceedings themselves. [146] The Originating Summons is hereby dismissed with costs. The ad interim injunction granted on 4.10.2024 is discharged. 28 April 2025 ATAN MUSTAFFA YUSSOF AHMAD Judge Kuala Lumpur High Court (Commercial Division) Counsel: For the Plaintiff: Noraini Roslie (Messrs Ariff & Co.) For the Defendant: Mahmud Abdul Jumaat (Messrs Emir Mahmud & Co.)