Silverland Capital Sdn Bhd v Wegrow Global Sdn Bhd (BA-22NCvC-207-05/2025)

This is an appeal by the Defendant against my decision delivered on 2.10.2025 whereby the Court allowed the Plaintiff’s application in Enclosure 4.

Enclosure 4 is the Plaintiff’s application by a Notice of Application dated 3.6.2025 under section 19(1)(c) of the Debtors Act 1957 for an 24/11/2025 14:12:17 BA-22NCvC-207-05/2025 Kand. 34 order of attachment before judgment against the Defendant, WeGrow Global Sdn Bhd.

The Plaintiff, Silverland Capital Sdn Bhd, is the registered proprietor and operator of the Silverlakes Village Outlet Mall in Batu Gajah, Perak. The Defendant is a commercial occupier operating a dinosaur-themed attraction known as “Dinosaur Encounter World: Area 65” at the mall.

The Plaintiff contends that the Defendant is in substantial arrears of rent and service charges exceeding RM2.29 million, has repudiated the binding effect of a tenancy agreement called the Heads of Terms dated 23.11.2023, and has taken steps to remove its property from the demised premises with intent to defeat execution of any judgment.

The Defendant resists the application, contending that the Heads of Terms is not binding, that there is no good cause of action, and that there is neither intent to obstruct nor any act of removal or concealment of property.

The salient facts are not seriously in dispute. Pursuant to the Heads of Terms dated 23.11.2023, the Plaintiff granted early possession of approximately 24,388 square feet of retail space (“the Demised Premises”) to the Defendant, who commenced operation in December 2023. The Heads of Terms provided for rental to be computed at 20% of monthly gross ticket sales, or alternatively, RM5.00 per square foot if the Defendant failed to install the agreed Point-of-Sale system.

The Defendant paid a booking fee of RM121,940.00 and entered the premises, carried out extensive renovations, and began operations. The Plaintiff provided utilities, security, and services in accordance with the Heads of Terms.

The Defendant failed to install the Point-of-Sale system, defaulted in rental and service charge payments, and disputed the binding effect of the Heads of Terms. By letters dated 28.11.2024 and 24.3.2025, the Defendant’s solicitors stated that the Heads of Terms was not binding and indicated an intention to vacate the premises. The Plaintiff’s staff later observed attempts to remove arcade machines and other movable assets without clearance.

The Defendant submits that the Heads of Terms was not binding, being subject to a formal tenancy agreement that was never executed. The Defendant asserts that negotiations broke down due to disagreement on key terms, and that notice of intention to vacate had been duly given.

It is further contended that there is no good cause of action, as the sums paid (RM379,337.03) represented temporary occupation charges pending a formal lease. The Defendant also claims that one unit (W3-6) was never occupied and that the Plaintiff failed to achieve a promised occupancy rate of 60%, rendering continued operation commercially unviable.

The Defendant argues that there is no intent to obstruct or delay execution, since there is no judgment restraining the Defendant from vacating the premises or removing assets. It is said that any removal of equipment was part of a legitimate process of vacating and mitigating losses, and that prior notice had been given.

Finally, the Defendant contends that there is no evidence of concealment or dissipation of assets, relying on Tiong Shiun San & Ors v Lee Kim Jiung [2018] CLJU 559, where the application under section 19 of the Debtors Act was dismissed due to absence of proof of obstructive intent.

The issues for determination are whether the Plaintiff has satisfied the three conditions under section 19(1)(c) of the Debtors Act 1957, namely: a) That the Plaintiff has a good cause of action; b) That the Defendant has acted with intent to obstruct or delay execution of any judgment; and c) That the Defendant has removed, or is about to remove, or has concealed, or is concealing, or making away with, or handing over to others, any of its movable or immovable property.

(A) Whether There Is A Good Cause of Action

The Defendant’s primary contention is that the Heads of Terms is not binding. However, the evidence shows that the Heads of Terms was executed by both parties, that possession was delivered, that rent was paid, and that operations commenced. The Defendant’s own conduct—occupying, renovating, and operating the premises— demonstrates part performance of a concluded bargain.

As held in Eng Song Aluminium Industries Sdn Bhd v Keat Siong Property Sdn Bhd [2018] 5 MLJ 380, where essential terms are agreed and acted upon, the contract is binding notwithstanding anticipation of a formal document.

Here, the essential terms—identity of premises, rental rate, deposits, and possession—were all settled. The Defendant’s substantial investment of over RM10 million in renovation and its continued use of the premises are inconsistent with its claim of non-binding arrangement. Its later denial, only after arrears accumulated, is self-serving and contrary to the doctrine of approbation and reprobation.

I, therefore find that the Heads of Terms constitutes a binding tenancy agreement, or at the very least, an enforceable contractual arrangement. The Plaintiff has shown a bona fide and legally recognisable claim for arrears exceeding RM2.29 million, thereby satisfying the first limb under Kepong Prospecting Ltd v Schmidt [1962] 1 MLJ 375.

(B) Whether There Is Intent to Obstruct or Delay Execution

The Defendant submits that it merely exercised its right to vacate and that there is no order restraining removal of assets. However, section 19(1)(c) of the Debtors Act 1957 does not require a subsisting judgment — it is preventive, aimed at preserving assets pending adjudication.

The Federal Court in Datuk Abu Mansor bin Mohamed Nasir v Bank Kerjasama Rakyat Malaysia Bhd & Anor [1982] 1 MLJ 258 held that obstructive intent may be inferred from “additional circumstances” showing deliberate evasion. Such circumstances are evident here:

The Defendant’s repudiation of the Heads of Terms and denial of liability despite ongoing occupation;

Threats to vacate without settling arrears; and

Unannounced removal of business equipment from the premises.

While the Defendant argues that prior notice of vacating was given, no documentary proof of such notice was exhibited in its affidavits. Even if notice was given, the cumulative conduct—denying a binding contract, refusing to pay, and quietly removing assets—evinces an intent to place property beyond the reach of lawful execution.

The Plaintiff’s application is supported by sworn affidavit evidence detailing these actions, which the Defendant has not effectively rebutted. I find on balance of probability that the inference of obstructive intent is amply established. The second limb is satisfied.

(C) Whether the Defendant Has Removed or Is About to Remove

The Defendant denies removing or concealing assets, asserting that any removal was part of a legitimate relocation. However, section 19(1)(c) of the Debtors Act 1957 extends to situations where a party “is about to remove” property. The Plaintiff’s evidence of equipment removal without clearance procedures stands unrebutted.

In Kepong Prospecting Ltd v Schmidt (supra), the Court of Appeal emphasised that the court must be satisfied on oath of both a good cause of action and the act or intent of removal. The Plaintiff’s affidavit evidence satisfies these requirements. In contrast, the Defendant’s bare denials and general assertions of “no court order” are insufficient.

I, therefore find that the Defendant’s acts fall within the mischief contemplated by section 19(1)(c)—namely, the premature removal of property that may frustrate any eventual judgment. The third limb is thus also satisfied.

The power under section 19(1)(c) of the Debtors Act 1957 is exceptional and must be used cautiously. The court must be satisfied on clear evidence that the Defendant’s conduct goes beyond normal commercial behaviour. Mere inability to pay or intention to vacate does not suffice.

Having carefully considered the affidavits, submissions, and authorities cited by both parties, I am satisfied that the Plaintiff has discharged the evidential burden under all three statutory requirements of section 19(1)(c) of the Debtors Act 1957.

The Defendant’s denials are largely conclusory meaning that the Defendant’s assertions or denials in the affidavit or pleading are bare, general statements and do not engage with the substance of the Plaintiff’s allegation. It does not effectively displace the Plaintiff’s evidence of arrears, repudiation, and asset removal. On the 2nd and 3rd limbs, while the evidence is not overwhelming, the totality of the Defendant’s conduct – denying the Heads of Terms, threatening to vacate without payment, and removing valuable assets – shows more than routine exit. In the face of arrears exceeding RM2.29 million and a complete denial of contractual liability, the inference of intent to frustrate recovery is justified.

The Heads of Terms was a concluded agreement acted upon by both parties, and the Plaintiff’s claim is genuine and legally sustainable.

The attachment sought is preventive in nature — to preserve the status quo and prevent dissipation of assets — and is warranted in the circumstances of this case. The Plaintiff will still have to prove its claim at trial, and the attachment will operate only as interim security pending determination of the main suit.

Accordingly, the Plaintiff’s Notice of Application (Enclosure 4) is allowed. The Court orders as follows: a) The Defendant, whether by itself or its representatives, servants or agents, is restrained from removing any movable assets belonging to the Defendant located in the demised property pending trial; b) The Defendant, whether by itself or its representatives, servants or agents, is further restrained from removing or interfering with any fixtures and fittings belonging to the Plaintiff in the demised premises; c) The Defendant’s movable property located at the demised premises be attached before judgment pursuant to section 19(1)(c) of the Debtors Act 1957; and d) Costs in the cause. Dated 24 November 2025 -sgd-DATO’ ANITA BINTI HARUN JUDICIAL COMMISSIONER HIGH COURT OF MALAYA SHAH ALAM SELANGOR DARUL EHSAN To the parties’ solicitors: For the Plaintiff : Zahria Eleena (Messrs Redza Eleena Chong) For the Defendant : Sara Anne Lee Xin (Messrs Nandrajog)