In subsection (1), "exempt disposition" means a disposition made by a liquidator, or by an interim liquidator of the company in exercise of the power conferred on him under Part I of Twelfth Schedule or the rules that appointed him or an order of the Court. [Emphasis added.] [42] Once a winding-up petition is filed against a company, any transfer of shares or alteration in the status of shareholders becomes automatically void, unless the court grants a specific order to allow it. This principle is embedded in company law to ensure that the company's assets, including its share structure, are preserved intact during the liquidation process, thereby protecting the rights of creditors and other stakeholders involved in the winding up. [43] As a result of this ‘legal freeze’, a shareholder, such as the Petitioner in these divorce proceedings, loses the ability to freely deal with or transfer his shares. This directly impacts the jurisdiction of the Family Court under section 76 of the Law Reform (Marriage and Divorce) Act, which empowers the Court to divide matrimonial assets equitably between spouses. If the shares in question are part of matrimonial assets, the Winding-Up proceedings would 31 May 2025 18 effectively paralyse the Family Court’s authority to make any meaningful orders regarding their division or transfer. [44] Furthermore, if Supermax Holdings Sdn Bhd is wound up, its assets would be sold off or liquidated, often under time constraints and in a distressed context. In such scenarios, assets may be sold at prices below their true market value, particularly if the liquidator aims to settle debts swiftly. This process could significantly reduce the overall value of Supermax Holdings Sdn Bhd, and consequently, diminish the total pool of matrimonial assets available for division between the Parties in the context of a divorce. [45] In this situation, as the Petitioner was seeking a share of the matrimonial assets under section 76 of the Law Reform (Marriage and Divorce) Act, this would create a significant challenge. Once the winding-up proceeds, the shares would effectively be frozen and eventually extinguished. After liquidation, tracing or recovering a portion of the former share value becomes practically and legally difficult, if not impossible. This would result in a situation where the true value of Supermax Holdings Sdn Bhd may be eroded, and the Petitioner’s ability to claim a just entitlement may be severely compromised, especially if the Family Court no longer has jurisdiction over the dissipated assets. [46] Hence for the First Respondent to submit that the Winding-Up Petition would not have any effect on the shares of Supermax Holdings Sdn Bhd, goes against basic legal principles of company law. 31 May 2025 19 [47] As such, it was my considered view that irreparable harm would likely ensue if the injunction sought in prayers 1, and 2 were not granted, bearing in mind the consequences of the winding up of Supermax Holdings Sdn Bhd. As such, it was given that damages would not be adequate remedy. [48] With regard to the requirement of an undertaking in damages, it is well established that this obligation is flexible and may be waived where the circumstances warrant a different approach. In this case, the circumstances were clearly distinguishable from those of a typical interlocutory injunction application. Accordingly, in my view, the usual requirement for an undertaking in damages may be dispensed with: Ang Sue Khoon v Majlis Bandaraya Pulau Pinang [2016] 11 MLJ 516. [49] In her submissions, the First Respondent also relied on the cases of WRP Asia Pacific Sdn Bhd v Ahmad Zul-Qarnain bin Ibrahim [2024] and Azman & Tay Associates v Sentul Raya Sdn Bhd [2002]. In my view, these authorities are inapplicable to the present case, as the central issue here concerns an abuse of the Court’s process. [50] In any event, it is trite law that the Court, which includes the Family Court, has inherent jurisdiction to grant a prohibitory injunction and this is a powerful safeguard against abuse of legal process. It exists to prevent misuse of the court’s procedures, protect litigants from unfair or coercive tactics, and uphold the proper administration of justice: La Kaffa International Co Ltd v Loob Holding Sdn Bhd [2018] MLJU 703. 31 May 2025 20 [51] As such, on a balance of convenience, the conduct of the First Respondent in filing the Winding-Up Petition warranted the granting of an injunction to give effect to prayers (1) and (2) of this Application. [52] With respect to prayer 3, the relief sought was effectively aimed at restoring the status quo ante, that is, the state of affairs that existed immediately prior to the presentation of the Winding-Up Petition. However, it is important to note that such an order would fall outside the jurisdiction of this Court. This Court does not possess the authority to reverse or nullify the legal consequences that may have already been triggered by the filing of a Winding-Up Petition. To grant such relief would risk encroaching upon the jurisdiction of the Winding-Up Court, which has exclusive authority to manage and supervise matters arising from insolvency proceedings. [53] In essence, this Court cannot assume a supervisory role over proceedings that are within the domain of the Winding-Up Court, and doing so would amount to a jurisdictional overreach. Whether a quia timet injunction was warranted for prayers 4 and 5 [54] A quia timet injunction was sought by the Petitioner for prayers 4 and 5. [55] A quia timet injunction is a form of injunctive relief that differs significantly from conventional injunctions. While traditional injunctions are typically granted to prevent the continuation or recurrence of an existing legal wrong, a quia timet injunction is pre-emptive in nature. Its primary purpose is to restrain a threatened or 31 May 2025 21 anticipated wrong that has not yet occurred but is practically certain to happen. [56] A quia timet injunction operates within a distinct legal framework. Where there is practical certainty that substantial harm is imminent, a party may seek this form of relief to prevent an anticipated legal wrong, even in the absence of any actual injury. This principle was clearly affirmed in PPES Resorts Sdn Bhd v Keruntum Sdn Bhd [1990] 1 MLJ 436, as reflected in the following passage: Now, the power of the Court to grant an injunction, temporary or perpetual is provided under s. 50 of the Specific Relief Act 1950 (Specific Relief Act) and such power is a discretionary one. I do not think that it is seriously disputed that quia timet injunction is a form of an interlocutory injunction, that is, until the determination of PPES's legal rights vis-a-vis Keruntum's legal rights over the forest area that is in dispute. In fact, I would venture to say that Keruntum's proposed action and the present action of PPES would in effect be based on more or less similar facts and the Court eventually determining as to who has the legal rights to the forest area in question. [Emphasis added.] [57] Clear criteria for the grant of a quia timet injunction have been established in Tan Sri Dato’ Kam Woon Wah v Dato’ Sri Andrew Kam Tai Yeow & Anor [2022] MLJU 424, where two key requirements were emphasised. [58] First, in the absence of actual damage, there must be compelling evidence of imminent danger. Secondly, it must be shown that the anticipated harm, if realised, would be substantial or irreparable. The danger must be so pressing that any delay in granting relief would likely result in significant harm. Where the threat is less 31 May 2025 22 immediate, the applicant must demonstrate that the damage, if it materialises, will arise in circumstances where later protection would be ineffective or impossible. [59] The Court’s power to grant such relief is discretionary, as provided in section 50 of the Specific Relief Act 1950. That discretion, however, should be exercised with caution. In Danaharta Hartanah Sdn Bhd v KSL Realty Sdn Bhd & Ors [2008] MLJU 460, it was reaffirmed that such orders are only made where there is a real and substantial risk of harm. There is no rigid benchmark for assessing the imminence of the threat; instead, the court should evaluate the totality of the circumstances, as illustrated in Hooper v Rogers [1975] Ch 43. This includes not only direct evidence of threat but also the broader context, such as the conduct and intentions of the defendant or respondent, which may suggest a likelihood of wrongful action even if not explicitly stated. [60] Quia timet injunctions have been granted across a wide range of legal contexts. These include preventing interference with the court’s jurisdiction, as in PPES Resorts Sdn Bhd v Keruntum Sdn Bhd; restraining the filing of a winding-up petition in cases where the debt is disputed, as demonstrated in Bina Satu Sdn Bhd v Tan Construction; and prohibiting acts that may obstruct an impending event, as seen in Ting Chuen Peng v Yap Kian @ Yap Sin Tian [2016] 10 CLJ 688. [61] Courts have also granted quia timet injunctions in a variety of contexts, including to restrain foreign proceedings that pose a risk of duplicative litigation, to prevent the misuse of trademarks or domain names, to prohibit the further publication of defamatory 31 May 2025 23 material, to address ongoing nuisances, and to curb administrative misconduct, such as the improper registration of caveats on land title. [62] In conclusion, the quia timet injunction is a vital legal remedy for situations where a clear and imminent threat of serious harm exists. It embodies a proactive approach to justice, ensuring that the law is not rendered reactive or ineffective in the face of foreseeable danger. The law does not compel individuals to remain passive in the face of impending harm. When justice calls for swift action, silence is not an option. Rather, one must remain alert and, if warranted, take decisive steps, such as pursuing a quia timet injunction. [63] In the present case, the quia timet injunction was sought by the Petitioner to prevent the First Respondent, either personally or through others, from transferring, dealing with, or diminishing the value of any assets or property acquired by either party before or during the marriage, until further order of the Court. [64] As explained earlier, based on the First Respondent’s conduct in attempting to wind up Supermax Holdings Sdn Bhd, there was a real and substantial risk that the Petitioner would continue to attempt to dissipate the other assets that have been prayed for in the Divorce Petition as well as the Judicial separation. [65] Upon careful consideration of Prayers 4 and 5, I was of the view that they were imprecise and lacked clarity. Accordingly, they were consolidated and redrafted into a single, coherent paragraph as follows: 31 May 2025 24 That the First Respondent, whether by herself, her agents, representatives, servants, employees, or otherwise, is prohibited until further order of the Court, from transferring, withdrawing, charging or mortgaging, encumbering in any manner whatsoever, dealing with, or otherwise disposing of, dissipating, diminishing the value of, or dividing in any way, any asset or property acquired before or during the marriage by any of the party. [66] The paragraph referenced above mirrored clause (a) of the January 2024 Court Order, which the Petitioner was obligated to comply with pursuant to the First Respondent’s application for ancillary relief. In my view, the principle of fairness required that clause (a) of the January 2024 Court Order be applied consistently across both the Judicial Separation Petition and the Divorce Petition. As the saying goes, what is sauce for the goose is sauce for the gander, fairness demanded that the same rules apply equally to both Parties to ensure parity in legal obligations and treatment. Conclusion [67] In conclusion, following a thorough examination and prudent evaluation of the submissions by Counsel for both Parties, and the evidence adduced, this Application was allowed with modifications. [68] The First Respondent was also ordered to pay costs in the amount of MYR10,000 (subject to allocatur) within 7 days from 26 March 2025, which was the date this decision was delivered. Dated: 31 May 2025 31 May 2025 25 SIGNED …………………………………………. (EVROL MARIETTE PETERS) Judge High Court, Kuala Lumpur Counsel: For the Petitioner – Chris Chin and Tan Han Rui; Messrs Shang & Co For the First Respondent – Fredric Kong, Avinash Kamalanathan and Jessica Leong; Messrs Bin & Associates