United Overseas Bank (Malaysia) Berhad v Bala Subramaniam A/L Rasu (Liquidator of Valiantview Construction Sdn Bhd (In Liquidation)) (WA-28PW-675-11/2024)

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1 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF KUALA LUMPUR, MALAYSIA (COMMERCIAL DIVISION) COMPANIES WINDING UP NO: 28NCC-603-07/2015 POST COMPANIES WINDING-UP NO: WA-28PW-675-11/2024 In the matter of Valiantview Construction Sdn Bhd (Companies No.: 662504-T) (In Liquidation); And In the matter of Sections 510 and 517 of the Companies Act, 2016; And In the matter of Order 29 and Order 92, rule 4 of the Rules of Court, 2012; And In the matter of Sections 41, 50, 51, 52, 53 and 54(b) Specific Relief Act, 1950; And In the matter of Units 1-G-04, 1-G-05, 1-1-03, 1-2-02, 1-2-03, 1-2-04, 1-2-05, 1-2-06, 1-3-06, 1-3A-03, 1-5-01, 1-5- 05, 1-5-06, 1-6-01, 1-6-03, 1-7-05, 1- 7-06, 1-8-02, 1-8-04, 1-9-02, 1-10-01, 1-10-06 dan 1-13-05, all at Blok 1 Casa Suria Condominium, Fasa 4, Taman Kemacahaya, Cheras, which are held under the Master Title GM6146, Lot 13146 (previously known as HS(M) 04897 PT No. 5704), Mukim Ulu Langat, Negeri Selangor (“the Units”); And In the matter of Loan Agreements Cum Assignments entered between the Purchasers/Assignors and the Applicant in respect of the Units aforesaid. BETWEEN UNITED OVERSEAS BANK (MALAYSIA) BHD (Companies No.: 199301017069) … APPLICANT AND BALA SUBRAMANIAM A/L RASU (NRIC No.: 550505-08-6695) [Liquidator of Valiantview Construction Sdn Bhd (Companies No.: 662504-T) (In Liquidation)] … RESPONDENT

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Schedule 3 12.5% Pursuant to interim certificate issued by Messrs. Zone Arkitek dated 14.12.2009 24. Released on 22.12.2009 – 12.2009 Item 5

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Schedule 3 5.0% Letter from Megatalent dated 23.7.2010 30. Released on 29.7.2010 – 7.2010 Item 4

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Schedule 3 2.5% Submission of subdivision application by Messrs. Studioukur Geomatics on 22.9.2010 30. Released on 28.9.2010 – 9.2010. 19. As such, it is claimed that all progressive payments were released to the Liquidator’s Housing Development Account (HDA). (see: “UOBM-8” of the Applicant’s Encl. 5 at pp 147-214 for the table summarising the total progressive payments made in accordance with the developer’s claims form the first release date to the full disbursement of the loan, along with the screen captures of the loan accounts for all 23 Units). The Winding Up 20. However, before the construction of Block 1 of the Project could be completed, Valiantview was wound up on 12.11.2015. The Respondent was appointed as Liquidator on 1.11.2017. (see “UOBM-2” of the Applicant’s Encl. 2 at pp. 34-35 for the winding up Order dated 12.11.2015). 21. On 24.11.2017, the Liquidator, by his letter dated 24.11.2017, enquired about the balance drawdown of the Project in order for him to confirm the Gross Development Value of the Project. On 7.12.2017, the Bank informed the Respondent that the Bank has released all progressive claims for the Project and there is no balance left to be drawndown (see Exhibit “UOBM-3” of the Applicant’s Affidavit at Encl. 2 at pp. 37 and 38 for the Liquidator’s letter of 24.11.2017 and the Bank’s letter of 7.12.2017. 22. Several exchanges of correspondence took place between the Bank and the Liquidator and/or his solicitors, Messrs. Maran Ram, during which the Bank explained the breakdown of the progressive payments for the Project to the Liquidator. The Bank further explained that the Liquidator’s request for the ‘Top-Up’ of the loan, if any, should be submitted by the respective purchaser(s) to the Bank for its consideration. (See: Exhibit “UOBM-3” of the Applicant’s Affidavit in Encl. 2 pp. 39-91 for the correspondences between the Bank and the Liquidator. 23. Despite the Bank’s response, between 18.1.2024 and 28.6.2024, the Liquidator issued notices of demand to the Bank, demanding payment of the alleged remaining 20% drawdown and a top-up sum, inclusive of 10% interest thereon, for the Units. 24. By the notices of demand, the Liquidator threatened to terminate the SPAs for the Units and to take all necessary steps if the Bank failed to accede to his demands, see “UOBM-4” of the Bank’s Encl. 2 at pp. 93-111 for the Liquidator’s notices of demand and the Bank’s replies. THE OS 25. On 16.8.202, the Bank filed the OS. The Applicant also filed for an ex-parte ad interim injunction, which was granted by the High Court on 19.8.2024, and thereafter, on 2.9.2024, after the inter partes hearing, the Court granted an Ad Interim Injunction in favour of the Bank (see “UOBM-5” of the Bank’s Encl. 2 at pp. 113-160 for the cause papers filed in the OS and the Ad Interim Injunction). The Law 11 26. This is an application for leave to pursue the OS against the Liquidator, an action against him personally. The Bank may have misconstrued this application under Encl 1 as an application against the company under s. 471(1) of the Companies Act, 2016. It is not. 27. The application for leave to proceed against the Liquidator as an officer of the Court must be obtained and the application is to be made under s. 486(2). This is clear from the Federal Court in N. Chanthiran Nagappan v. Kao Che Jen [2023] 5 MLJ 284 where the Federal Court held that leave of the winding up court is required to commence proceedings against a Court appointed liquidator as an officer of the Court. The Bank’s Claim 28. It is trite that by virtue of the loan agreements cum assignment by the purchasers of their rights under the SPAs to the Bank, the Bank is the absolute assignee of the rights under the SPAs and the Units. 29. The Bank claims that the balance 20% of the purchase price financed by the Bank, had been released by 2010, see: Exhibit “UOBM-8” at Encl. 2, pp 147-214. And as the Developer has received the full purchase price for the Units, and in view of the absolute assignments of their rights, titles and interest in their SPAs to the Bank, the Developer and/or the Liquidator are therefore, at best, a bare trustee(s) holding the Units in trust for the benefit of the purchasers and the Bank, whilst awaiting the issuance of strata titles. As such, the Bank claims that neither the Liquidator nor the Developer has a right to deal with the Units. 30. It follows that the notices of demand issued by the Liquidator, by which the Liquidator threatens to terminate the SPAs, are unlawful. The Leave Application 31. By Encl 1, the Bank thus seeks the remedies against the Liquidator with respect to the status of the SPAs and the Units. 32. Leave is required. In SKN Land & Development Sdn Bhd v Chan Siew Mei [2025] MLJU 2763, I had an opportunity to consider applications for leave to commence proceedings against a Court appointed liquidator. “[11] The requirement for leave before proceedings are commenced against a liquidator, serves an important filtering function to ensure that proceedings against an officer of Court are not frivolous, vexatious, or an abuse of process, see the Court of Appeal in Chi Liung Holdings Sdn Bhd v Ng Pyak Yeow [1995] 3 MLJ 204, citing the Privy Council in Lloyd-Owen v Bull (1936) 4 DLR 273. [12] And recently, Nallini Pathmanathan FCJ speaking for the Federal Court in N Chanthiran a/l Nagappan v Kao Che Jen [2023] 5 MLJ 284, said in the context of the scope of the liquidator’s duty: “[20] The primary function of a liquidator is to realise the assets of the wound up company and pay the resulting proceeds to the general body of unsecured creditors (see: Hugh K Thomson, A Practical View of the Receiver’s Relationship with Other Office Holders - The Liquidator (2000) 16(2) IL&P 74). In other words, a liquidator represents the entire class of unsecured creditors. It is therefore crucial for the court to ensure that a liquidator does not face unwarranted interference in the process of discharging his duties.” 33. In N. Chanthiran (supra) at paras 34 and 37(d)(i), the Federal Court held that a prima facie case must be shown before leave is granted. And further, pecuniary loss must be shown in the case of a misfeasance claim against the Liquidator. The Federal Court held: “[27] In short, the control by the court of any such action against the liquidator acts as a filter against vexatious, frivolous and improperly motivated proceedings. [28] On the test for granting leave to commence proceedings against a liquidator, the High Court in Sarawak Timber Industry referred to its previous decision in TN Metal Industries and concurred with the reasoning therein that there should be more than a mere allegation against the liquidator. The High Court further held that when misfeasance proceedings are brought against the liquidator, the applicant should prove pecuniary loss to the wound-up company.” 34. The need for pecuniary loss to the company is required because when the company commences proceedings against the Liquidator, pecuniary loss is required otherwise the proceedings would be a waste of the company’s resources. The need to show pecuniary loss to the company is unnecessary when proceedings are commenced by a third party against the liquidator, as is the case here. 35. I am satisfied that the Bank has shown a prima facie case against the liquidator. The claims of the Bank and indeed, the purchasers would be severely prejudiced if the Bank is correct in that the full purchase price under the SPAs has been released to the Liquidator and/or the Developer. CONCLUSION 36. The Bank should be allowed to proceed against the liquidator. It may well be that the Developer should be joined as a defendants. However, that is a matter for the Bank. I accordingly granted prayer 1 of Encl 1. The Bank indicated that it was not proceeding with the other prayers. I accordingly dismissed prayer (b) with no order as to costs. Dated the 27th day of March 2026 ….....................t.t................................ YA TUAN SAHERAN SUHENDRAN JUDICIAL COMMISSIONER OF THE HIGH COURT (COMMERCIAL 11) (INSOLVENCY 2) OF KUALA LUMPUR IN THE TERRITORY, MALAYSIA Case References: • N. Chanthiran Nagappan v. Kao Che Jen [2023] 5 MLJ 284 • SKN Land & Development Sdn Bhd v Chan Siew Mei [2025] MLJU 2763 Legislation References: • Companies Act, 2016 Decision Date: 21st January 2026 Counsel for the Applicant: Solicitors: KK Chan & Tiang Min Min Messrs. Shook Lin & Bok (Kuala Lumpur Counsel for the Respondent: Solicitors: Edward Yii Messrs. The Law Office of Maran Ram (Petaling Jaya)