Tresenergy Sdn Bhd v 1. ) Mohd Fauzi Bin Ya'Akob (BA-22NCvC-603-12/2018)

MOHD FAUZI BIN YA’AKOB

MTC ENGINEERING SDN BHD (NO. SYARIKAT: 843778-T) ... DEFENDAN-DEFENDAN GROUNDS OF DECISION (Enclosure 80 - Stay Of Execution Pending Appeal)

On 14 January 2020, the High Court dismissed the Plaintiff’s claims after a full trial and allowed the Second Defendant’s 12/11/2025 09:54:29 BA-22NCvC-603-12/2018 Kand. 100 counterclaim, with damages to be assessed by the Senior Assistant Registrar.

On 23 July 2021, the Court of Appeal reversed the High Court’s decision and allowed prayers (a), (b), and (c) of the Statement of Claim as follows: “ (a) Satu Deklarasi bahawa Defendan Pertama telah gagal menjalankan tugas-tugas fiduciary sebagai Pengurus Projek dan terjumlah kepada satu “inducement of breach of contract”;

Satu Deklarasi bahawa Defendan Kedua telah gagal menjalankan tugas-tugas sebagai Rakan Konsortium yang menyumbang kepada penamatan kontrak FPSO tersebut; dan

Satu Deklarasi bahawa Defendan Kedua telah secara salah mengacau ganggu kepentingan Plaintif di dalam Projek FPSO Ledang tersebut dengan terjumlah kepada satu “Tort of Interference”.

The Court of Appeal also ordered damages to be assessed for prayers (d)(i) and (e) of the Statement of Claim.

Following the Court of Appeal’s decision, an assessment of damages was done before another trial judge.

On 7 August 2025, the Learned Trial Judge delivered the following judgment based on the assessment of damages (“Judgment”): “1. Bahawa gantirugi bagi kehilangan keuntungan perniagaan dan pendapatan berjumlah USD3,332,050.00 (dengan kadar pertukaran USD/Ringgit sebanyak RM4.23/USD 1) hendaklah dibayar oleh Defendan-Defendan secara bersama dan berasingan kepada Plaintif;

Faedah pada kadar 5% ke atas USD3,332,050.00 perlu dibayar oleh Defendan-Defendan secara bersama dan berasingan kepada Plaintif dari tarikh Penghakiman ini sehingga tarikh penyelesaian penuh; dan

Kos sebanyak RM20,000.00 perlu dibayar oleh Defendan-Defendan secara bersama dan berasingan kepada Plaintif tertakluk kepada fi alokatur.”

The Defendants are aggrieved with the entire Judgment and have filed a notice of appeal to the Court of Appeal (“Defendants’ Appeal”).

Based on the following complaints, the Plaintiff has also filed a notice of appeal to the Court of Appeal against part of the Judgment (“Plaintiff’s Appeal”): “1. Tidak membenarkan sebarang kuantum gantirugi bagi kehilangan keuntungan perniagaan dan pendapatan yang boleh diperolehi daripada sebuah kapal dikenali sebagai MTC Ledang (dulu dikenali sebagai Puteri Bangsa) dibayar oleh Defendan-Defendan kepada Plaintif; dan

Tidak membenarkan sebarang kuantum atas gantirugi teruk dibayar oleh Defendan-Defendan kepada

Via Enclosure 80, the Defendants are now applying under Order 45 rule 11 and Order 92 rule 4 of the Rules of Courts 2012 to stay the execution of the Judgment pending the disposal of the Defendants’ Appeal.

The main issue for Enclosure 80 is whether there are special circumstances that necessitate a stay of execution of the Judgment pending the disposal of the Defendants’ Appeal.

For the financial year ending 31 December 2024, the Second Defendant only recorded a profit of RM1,324,750.00, which is insufficient to satisfy the Judgment of RM14,094,571.50

Based on the above reason, the Learned Counsel for the Defendants contended that Enclosure 80 should be granted due to the Second Defendant’s impecuniosity.

I disagree that the Second Defendant’s impecuniosity is a special circumstance that necessitates a stay of execution of the Judgment pending the disposal of the Defendants’ Appeal.

The Defendants should focus on the Plaintiff’s inability to refund the payment if they succeed in the Defendants’ Appeal. (Kosma Palm Oil Mill Sdn Bhd & Ors v. Koperasi Serbausaha Makmur Bhd [2003] 1 MLRA i; [2003] 4 CLJ 1; [2004] 1 MLJ 257).

To challenge the Plaintiff’s ability to reinstate the Defendants to their original position if they win the Defendants’ Appeal, the Defendants must first demonstrate that they have sufficient funds to satisfy the Judgment.

In this case, the Defendants not only failed to demonstrate that they can satisfy the Judgment but also admitted that they did not have sufficient funds to do so.

Based on that admission alone, it would be premature for the Defendants to challenge the Plaintiff's ability to reinstate them to their original position if they win the Defendants’ Appeal.

The threat of bankruptcy against the First Defendant is also not a special circumstance which necessitates a stay of execution of the Judgment pending the disposal of the Defendants’ Appeal. (Ming Ann Holdings Sdn Bhd v Danaharta Urus Sdn Bhd [2002] 3 MLJ 49; [2002] 1 MLRA 214; [2002] 3 CLJ 380; DOPAG Dosiertechnik UND Pnuematik AG v Gamel Nasir Taib & Ors [2016] 1 LNS 938; [2016] MLRHU 1403; [2016] MLJU 812).

The Learned Counsel for the Defendants contended that if the Defendants paid the Judgment, the Second Defendant would have to cease its business operations, and these consequences would ensue:

the Second Defendant can no longer supply floating platforms to Petronas for extracting oil from the seabed;

the Second Defendant can no longer provide assets such as Floating Production Storage Offloading (FPSO) for extracting, storing, and transferring crude oil, Floating Storage Offloading (FSO) for transferring crude oil to another platform, or Mobile Offshore Production Unit (MOPU) for transferring crude oil to Petronas, Petronas Carigali, Petronas subsidiaries, and Petra Energy. These assets are crucial national infrastructure because they directly connect to offshore oil wells;

the Second Defendant’s existing contracts with Petronas Carigali Sdn Bhd, Petra Energy Development Sdn Bhd, and Vestigo Petroleum Sdn Bhd will be impacted; and

if the business operation of the Second Defendant is interrupted:

Malaysia will forfeit tens of thousands of barrels of oil each day;

(ii) the decrease in the production of tens of thousands of barrels of oil per day will negatively impact the entire ecosystem of the oil and gas industry, not only at the upstream level but also midstream and downstream;

(iii) it will affect the country’s revenue via Petronas dividends;

(iv) there is a risk of damage to oil wells and environmental pollution; and

replacing the floater facilities will take years and incur high costs.

It is important to note that neither the Government of Malaysia nor Petronas has provided evidence that discontinuing the contracts involving the Second Defendant will affect the national interest.

The above Issue No. 3 concerns solely the Defendants’ fear of losing.

Merely ‘fear of losing’ does not constitute a special circumstance which necessitates a stay of execution of the Judgment pending the disposal of the Defendants’ Appeal.

In Ming Ann Holdings Sdn Bhd v. Danaharta Urus Sdn Bhd [2002] 1 MLRA 214; [2002] 3 MLJ 49, the Court of Appeal held that: “[84] The grounds relied on by the appellant are nothing more than “fear of losing”; fear of losing business, fear of losing customers, fear of losing suppliers, fear of losing goodwill, fear of not being able to collect its debts from third parties, in case the appellant company is wound-up. All that the applicant has to do to avoid such “fears” is to settle the judgment debt. … [86] Whatever it is, those factors are not “special circumstances” (if we want to use the term) nor do they show that the appeal, if successful, will be rendered nugatory (if we prefer that term). They are nothing unusual. Execution is a natural process after obtaining a judgment and winding-up is one of them.” (emphasis added)

Although the Plaintiff is a wound-up company, it has obtained the Judgment against the Defendants.

Unless there are special circumstances to justify a stay of execution of the Judgment pending disposal of the Defendants’ Appeal, the Plaintiff should not be deprived of the fruits of its litigation.

The impecuniosity of the successful litigants is not a special circumstance which necessitates a stay of execution of the decision pending appeal.

In Azlin Mohd Yusof v. Bank Simpanan Nasional Berhad & Anor [2023] MLRHU 2270, Wan Ahmad Farid J (now YAA CJ) explained the position of a successful litigant’s impecuniosity and had this to say: “[18] What then is the law? Generally, the impecuniosity or precarious financial position of the successful litigant is, not by itself, a ‘special circumstance’ justifying an unconditional stay of the whole of the judgment debt required to be paid…”

I reiterate that the Defendants should have focused on the Plaintiff’s inability to reinstate them if they succeed in the Defendants’ Appeal, but they failed to do so. (Kosma Palm Oil Mill Sdn Bhd & Ors v. Koperasi Serbausaha Makmur Bhd [2003] 1 MLRA i; [2003] 4 CLJ 1; [2004] 1 MLJ 257).

To address the Defendants’ concern about the possibility of not being reinstated to their original positions if they win the Defendants’ Appeal, the Plaintiff proposed a conditional stay of execution.

This proposed conditional stay would be contingent upon the deposit of the entire Judgment sum or any part thereof, as the Court deems appropriate, into a stakeholders’ account maintained and managed by Messrs Yusfarizal Aziz & Said, pending the disposal of the Defendants’ Appeal.

The terms of the Plaintiff’s proposed conditional stay are as follows (“Proposed Conditional Stay”):

the Defendants shall, jointly and severally, pay the Judgment (or any part of it as determined by this Court) to the Plaintiff’s solicitor, together with the RM20,000.00 costs, within the period specified by this Court;

the interest on the Judgment shall be stayed pending the disposal of the Defendants’ Appeal; and

if the above sum in (a) is not paid within 60 days of the date of the order, there shall be no stay of execution of the entire Judgment.

In Enclosure 91, Messrs Yusfarizal Aziz & Said also provided their solicitors’ undertakings (“Solicitors’ Undertakings”). Essentially, they are as follows:

not to disburse or release the money held to any third party, including the Plaintiff and/or Liquidator, until the disposal of the Defendants’ Appeal;

to hold the money in accordance with the Court Order and any relevant law(s) governing the duties of a solicitor as a stakeholder;

to refund the money to the Defendants immediately if the Defendants win the Defendants’ Appeal; and

to disburse the money to the Liquidators for the purpose of liquidation of the Plaintiff if the Defendants’ Appeal is dismissed.

The Defendants objected to the Proposed Conditional Stay and Solicitors’ Undertakings. The Learned Counsel for the Defendants also referred to paragraph 2(f) of the Sanction, which states: “Peguam yang mengendalikan kes hendaklah memaklumkan kepada PPP sekiranya ingin merayu. Bagi setiap peringkat prosiding/rayuan, kebenaran penyelesaian (‘sanksi’) yang baharu hendaklah dimohon oleh Penyumbang kepada PPP. Permohonan tersebut akan dipertimbangkan oleh PPP tertakluk kepada syarat-syarat Bon Jaminan dan Aku Janji Penjamin; dan” (emphasis added)

Based on paragraph 2(f) of the Sanction, the Learned Counsel for the Defendants argued that the contributories of the Plaintiff must first obtain another sanction from the Official Receiver and Liquidator to authorise Messrs Yusfarizal Aziz and Said to continue representing the Plaintiff in Enclosure 80 and both appeals.

The Learned Counsel for the Plaintiff confirmed that the contributories of the Plaintiff were still in the midst of applying for a fresh sanction to authorise Messrs Yusfarizal Aziz and Said to represent the Plaintiff in both appeals.

I am of the view that the aforesaid Sanction only allows the contributories of the Plaintiff to proceed with or continue the civil suit against the Defendants. The assessment of damages has concluded and the Judgment has been delivered. Both parties have also filed their appeals to the Court of Appeal. Enclosure 80 relates solely to the stay of execution of the Judgment pending the disposal of the Defendants’ Appeal. The Sanction is silent on the authority given to the contributories to offer the Proposed Conditional Stay pending disposal of the Defendants’ Appeal. Therefore, it is premature for this Court to consider the Proposed Conditional Stay without a fresh sanction and clear authority from the Official Receiver and Liquidator.

The burden of proof lies with the Defendants to demonstrate special circumstances that justify a stay of execution of the Judgment pending the disposal of the Defendants’ Appeal.

Here, not only is the Judgment purely monetary, but the Defendants have failed to demonstrate that there are special circumstances to justify a stay of execution of the Judgment pending the disposal of the Defendants’ Appeal.

Based on the foregoing reasons, Enclosure 80 is dismissed and the Defendants are ordered to pay the agreed cost of RM2,000.00 to the Plaintiff, subject to allocatur fees. Dated 10 November 2025 SGD HELMI BIN HAMZAH JUDICIAL COMMISSIONER HIGH COURT OF MALAYA AT SHAH ALAM NEGERI SELANGOR Counsel for the Plaintiff : Mr. Adam Luqman Bin Amdan (Messrs. Yusfarizal Aziz & Said) Counsel for the Defendants : Mr. Arham Rahimy Bin Hariri (Mr. Yusman Che Aman) (Messrs. Hazura Yusoff & Partners)