R never made any claims against P for the LAD. [27] I find R’s argument insupportable. One—R has produced no documentary evidence about appointing the three subcontractors to complete the works, nor was there any documentary evidence of the works that they performed. [28] Two—R has not filed a suit against P for these alleged losses and damage—in all these years (from around 2014 until now). [29] Three—LAD claims are contractual claims. R has not shown that there are provisions in the LOAs that give R the contractual right to make LAD claims against P. [30] Four—even if there are LAD provisions to make a LAD claim, R must issue a certificate of non-completion (CNC) to P. The CNC (or some form of it) is the required formal notice to P that P had failed to complete the works that they were contracted to perform—Kerajaan Malaysia (JKR) Page 9 of 12 v Global Globe (M) Sdn Bhd [2019] 1 MLJ 281 (CA); [2019] 9 CLJ 191; [2018] AMEJ 1144; [2018] 6 MLRA 134; at paragraph [75]. [31] Five—R’s “Letter of Undertaking for Payment Due”, which stated that R agreed to pay P the RM864K, and R’s written Confirmation of Balance due to P—were issued in October 2016. Then, from April 2017 to January 2020—R made seven payments to P. In this entire period, R did not produce evidence to substantiate that it had a genuine and substantial dispute against the debt that P demanded on being paid. 4th argument: R signed the “Letter of Undertaking for Payment due” with the understanding that what was due to R would be deducted [32] Fourth—R asserts that when R signed the “Letter of Undertaking for Payment Due”, it was signed with the understanding that what was due from P to R would be deducted from the RM864K due. [33] However, there is no evidence, besides R simply saying so, that there was such an understanding. 5th argument: R signed the “Confirmation of Balance” only for P’s audit purposes [34] Fifth—R asserts that R signed the “Confirmation of Balance” due only after R got P’s promise that the document was only for P’s audit purposes, and not an admission of a debt due. R quotes this sentence in the “Confirmation of Balance”—“This is not a request for payment, but a confirmation of your balance for audit purposes”. Page 10 of 12 [35] My view against R’s argument, however, is that even though the “Confirmation of Balance” due was not a request for payment, it was obviously a verification of the RM864K due from R to P. [36] Further, even without this “Confirmation of Balance”, there was still the evidence of the “Letter of Undertaking for Payment Due”, as well as the seven payments made by R—which I find to be an unequivocal admission to the RM864K debt. When the seven payments made were deducted from this amount, the balance due became the RM671K demanded by P under section 466 of the CA. And when R did not meet that statutory demand, R was deemed to be unable to pay its debts. [37] Furthermore, R has failed to show, by affidavit evidence, that it is commercially solvent. R has failed to show that it can pay its debts as and when they fall due—Sri Hartamas Dvpt. Sdn Bhd v MBf Finance Sdn Bhd [1992] 1 MLJ 313 (SC); [1991] 1 CLJ 303; [1992] 1 MLRA 31; Maril-Rionebel (M) Sdn Bhd v Perdana Merchant Bankers [2001] 4 MLJ 187 (CA); [2001] 3 AMR 2893; [2001] 3 CLJ 248; [2001] 1 MLRA 270. [38] And, R has not disclosed its assets and liabilities to demonstrate that it is commercially solvent—BMC Construction (supra). [39] Put differently, R did not exhibit its accounts or other documentary evidence that proved that it was solvent. R did not exhibit its accounts or other documentary evidence to demonstrate that it refused to pay P’s section 466 statutory demand purely because it genuinely and substantially disputed the debt. CONCLUSION Page 11 of 12 [40] I have considered the balance of both sides’ merits. On the one hand, it is a serious matter to wind up a company, especially one that is solvent. But here, R has not shown that it is solvent, and that it should be accorded that preservation. [41] On the other hand, it is also not right to allow an insolvent company to continue to trade and do business effectively with the capital of its creditors—Ilumina Sdn Bhd v Goldenlink Engineering Sdn Bhd [2021] 1 AMR 792 (HC); [2020] MLJU 2001, para [50]; [2020] CLJU 1748; [2020] MLRHU 1596, citing Re Melbourne Carnivals Pty Ltd (No 1) [1926] VLR 283 at 290. [42] For the above reasons, and on the grounds that R is unable to pay its debts, and that it is just and equitable to do so, I allow this winding up Petition at prayers 17(1), (2) and (3), with costs of RM15K to be paid to P out of R’s assets. Dated: 29 April 2025 KENNETH ST JAMES Judge Penang High Court Page 12 of 12 Counsel/Solicitors: For the Petitioner—Alane Neo and Kenneth Liew [Messrs. T S Liew Nurzila & Co. (Petaling Jaya)] For the Respondent—Asmawi Ismail [Messrs. Deidra Sharina & Co (Seremban)] Legislation referred to: