Schedule
Jadual Kepada Akta Mahkamah Kehakiman 1964; Dan Dalam Perkara Mengenai Aturan 53 Kaedah-kaedah Mahkamah 2012. ANTARA WINTONI GROUP BHD (NO. SYARIKAT: 766535-P) ...PEMOHON DAN BURSA MALAYSIA SECURITIES BERHAD (NO. SYARIKAT: 635998-W) ...RESPONDEN JUDGMENT [1] The applicant is a company that was listed on the ACE Market of the Bursa Securities on 22.1.2008. The nature of the applicant’s business is investment holding. The respondent is a body corporate licensed as a stock exchange under the Capital Markets and Services Act 2007, which regulates securities exchange in Malaysia, including the ACE Market. [2] In 2016, the applicant company triggered the prescribed criteria under paras 2.1(a) and 2.1(b) of Guidance Note 3 and became a GN3 company. In short, it is a company in distress. [3] Under the circumstances of the case, the applicant company had to comply with r 8.04 of the ACE Listing Requirements (“ACE LR”) in order to regularise its condition. [4] There was a winding-up order against the applicant company, which was made on 17.8.2017. [5] On 24.9.2019, the applicant company announced that the Winding-Up Court made an order on 17.1.2019 to terminate its winding up within 14 days from the order. [6] The applicant company’s announcement dated 24.9.2019 states inter alia as follows: Pursuant to an application commenced by Mr Cheah Kwong Lee, a contributory of Wintoni, the Court has granted an Order on 17 September 2019 to terminate the winding up of Wintoni subject to the liquidator of Wintoni making payments to the creditors of Wintoni within 14 days from 17 September 2019. Upon completion of the same, the winding up of Wintoni will terminate and the liquidator will cease to hold office as liquidator of Wintoni. [7] The liquidator vacated its office on 1.10.2019. [8] On 29.10.2019, the applicant completed its 100% acquisition of one Teampixel Sdn Bhd (“Teampixel”). Teampixel’s principal business is distributing and selling wholesale products on business-to-business platforms and other trading and ICT businesses. According to the applicant, the acquisition was part of the restructuring effort to regularise its financial position. [9] Since then, Teampixel had been the sole revenue contributor to the applicant company. [10] Subsequently, Teampixel had entered into separate distribution agreements with Ruizhi Plastics Sdn Bhd and Pink Mount Express Sdn Bhd as their distribution partners to sell out and distribute chemical products in Malaysia and other neighbouring countries. [11] On 3.1.2020, the respondent granted the applicant an extension of time (“EOT”) until 2.7.2020 (“EOT-1”) to submit its regularisation plan subject to the applicant’s appointment of a Listing Sponsor by 2.4.2020. In compliance with the condition, the applicant appointed TA Securities Holdings Berhad (“TA Securities”) as its Listing Sponsor. [12] The applicant, through TA Securities then vide a letter dated 12.6.2020, applied to the respondent for an EOT to submit its regularisation plan. The applicant cited that there had been significant progress in the applicant’s regularisation efforts and that the Movement Control Order (“MCO”) had impacted Teampixel's business plans, especially its negotiations with potential parties from China due to the lockdown. [13] The respondent acceded to the request and granted an EOT to the applicant until 1.1.2021 (“EOT-2”). [14] In the meantime, Teampixel secured separate strategic partnership and bulk purchase agreements with Alpha Plastic Resources Sdn Bhd and Nova Plastics Industries respectively. On 4.12.2020, Teampixel entered into an unincorporated joint venture with Global Integrated Communications Pte Ltd. Global Integrated is a company engaged in telecommunications reselling and third-party telecommunications providers. [15] However, on 1.12.2020, TA Securities resigned as the applicant’s Listing Sponsor. [16] At the applicant's request, the respondent granted the applicant another extension (“EOT-3”) until 30.6.2021 to submit its regularisation plan subject to the applicant’s appointing a replacement Listing Sponsor by 1.3.2021. [17] Citing the difficulties caused by the Covid 19 pandemic and the MCO, the applicant sought a further extension of 2 months from the respondent in appointing the replacement Listing Sponsor. [18] The respondent, however, decided to reject the applicant’s application for the EOT to appoint the Listing Sponsor and to de-list the securities of the applicant from the official list of Bursa Securities (“the impugned decision”). The respondent’s letter, which was dated 11.3.2021, inter alia states as follows: (a) The Company was and/or should be aware of the clear requirements under Rule 8.04(5)(b) read together with Rule 8.04(3) of the ACE LR that Bursa Securities shall de-list the Company for failing to appoint a Sponsor within the timeframe permitted by Bursa Securities; and (b) The Company has yet to identify a Sponsor since the last extension of time granted until 1 March 2021 vide Bursa Securities’ letter dated 13 January 2021. [19] The applicant took exception to the rejection. It asserted that the respondent’s decision is contrary to the respondent’s announcement made on 17.2.2021 on the implementation of temporary relief measures in the light of the worsening Covid 19 crisis in Malaysia. According to the respondent’s circular dated 17.2.2021, the temporary relief measures include inter alia: (a) An automatic extension of 12 months’ period for a GN3 company to submit its regulation plan; and (b) A listed company that newly triggered the prescribed criteria under GN3 is not required to comply with the requirements under r 8.04 of the ACE LR. [20] On 15.3.2021, the applicant submitted an appeal against the impugned decision. [21] By a letter dated 15.3.2021 (“the Final Letter”), the respondent informed the applicant that the impugned decision was final and the applicant would be de-listed on 16.3.2021. The Judicial Review [22] Aggrieved, the applicant commenced this judicial review application seeking inter alia an order of certiorari to quash the impugned decision. [23] The application is supported by the affidavits of Goh Joon Meng in Encls 2 and 4(“AIS-2” and “AIS-4”). Encik Goh is the director of the applicant company. [24] The grounds of the application, as reflected in AIS-2, are that the impugned decision is tainted with procedural impropriety, unreasonableness and the failure of the respondent to uphold the applicant’s legitimate expectation in arriving at the impugned decision. [25] On the issue of procedural impropriety, learned counsel for the applicant submitted that in arriving at the impugned decision, the respondent had failed to consider that, but for the MCO, the replacement Listing Sponsor would have been appointed by the applicant. In any event, according to learned counsel, the applicant had implemented effective regularisation efforts. For the financial year ending 2020, the revenue generated was approximately RM28m, with profit after tax approximately RM6m. [26] The applicant and its group had been making profits for 6 consecutive quarters. [27] In support, learned counsel then cited the judgment of the Federal Court in Malaysia Airline System Bhd v Wan Sa’adi @ Syed Sa’adi bin Wan Mustafa [2015] 1 MLJ 757 FC. The case carries the proposition that procedural impropriety was said to have occurred when a decision maker in coming to a decision with consequences affecting 'some person’. In arriving at that decision, the administrative body must observe the basic rules of natural justice. They are generally understood to mean the right to be heard, the rule against bias and the duty to act fairly. [28] As to the duty to act fairly, my attention was drawn to the Court of Appeal case of Majlis Bandaraya Pulau Pinang v Datin Noorzalina Mat Zain & Anor [2019] 4 CLJ 36 CA. The Court of Appeal held that the duty to act fairly involves “taking into consideration all relevant factors” in making the impugned decision. [29] Applying the said propositions to the facts of the case, learned counsel for the applicant submitted that given the exceptional circumstances and business environment caused by the Covid 19 pandemic, the 4th EOT requested by the applicant ought to be granted by the respondent. [30] Secondly, learned counsel for the applicant contended that the respondent had not acted reasonably, rationally and consistently in arriving at the impugned decision. [31] In arguing that that impugned decision is tainted with Wednesbury unreasonableness, learned counsel submitted that: (a) The previous events that led to the winding-up of the applicant company are irrelevant. They should not be taken into consideration by the respondent. According to learned counsel, the applicant company is now strengthened with new management members. (b) The impugned decision is unfair to the applicant because of the policy and practice of the respondent in granting other companies listed in ACE Market a blanket automatic EOT but failed to exercise its discretion to allow the applicant’s application. According to learned counsel, the unfairness lies in the reason for the respondent’s policy is the very same reason set out by the applicant in its 4th application for the EOT. [32] Learned counsel then referred me to the judgment of the Court of Appeal in Dato’ Seri Dr Ahmad Zahid bin Hamidi, Menteri Dalam Negeri Kementerian Dalam Negeri & Ors v Soo Lina & Ors [2018] 2 MLJ 738 CA. In the case, the Court of Appeal held that the test of reasonableness could include instances where it is indefensible for being in the teeth of plain reason and common sense. [33] According to learned counsel, the Wednesbury’s test applies to a decision that is so reprehensible in its defiance of logic or of accepted moral or ethical standards that no sensible man who applied his mind to the issue to be decided could have arrived at it; Malaysian Oxygen Berhad v Soh Tong Wah [2011] 1 LNS 790. [34] Applying the law to the facts of the case, learned counsel submitted that the respondent was prepared to allow the applicant’s regularisation plan to be submitted in June 2021 in light of the Covid 19 pandemic. However, the deadline for the replacement of the Listing Sponsor was imposed on 1.3.2021. According to learned counsel, had the respondent acted with good reason and common sense, it would have granted the applicant a short extension of time. [35] Thirdly, after the termination of the applicant’s winding-up, a meeting was held on 12.12.2019, where the respondent agreed to grant the applicant further extensions to continue with the applicant’s effort to revive the company. Learned counsel submitted that the respondent's conduct had given rise to a legitimate expectation that a reasonable time ought to be granted to the applicant. This is to enable the applicant to appoint a replacement after TA Securities resigned from being the Listing Sponsor; see Darahman Ibrahim & Ors v Majlis Mesyuarat Kerajaan Negeri Perlis & Ors [2008] 4 CLJ 538 CA. The analysis [36] The respondent has filed an affidavit in reply in Encl 17 (“AIR-17”) through Yuvonne Tan Ai Bee. Cik Tan is the Head of Enforcement of the respondent. There are further exchanges of affidavits between the parties in Encl 19 (“AIS-19”) and Encl 20 (“AIR-20”). [37] Learned counsel for the respondent attracted my attention to incidences in 2017 that led to the winding-up order of the applicant company on 17.8.2017. I do not respectfully think that the incidences cited by learned counsel are relevant. [38] The issue in this judicial review arises from a fresh application to the respondent for an extension of time to submit a regularisation plan after the termination of the winding-up order. The issues prior to the termination of the winding-up order have no bearing on this fresh application. They are, if I may say, done and dusted. [39] According to the respondent, in the Final Letter, the respondent asserted that: (a) All representations made by the applicant, including the difficulties faced during the Covid 19 pandemic, were considered by the Listing Committee of the respondent together with other facts and matters before the impugned decision was reached. (b) Notwithstanding the purported progress of the regularisation efforts by the applicant and the applicant’s financial position, the fact remained that the applicant had failed to submit its regularisation plan despite numerous EOTs granted to the applicant company. According to the respondent, the applicant should comply with the requirements in paras 5.2 and 5.3 of GN3. (c) In any event, there were no new grounds put forth by the applicant to justify a further extension of time for the applicant to appoint a Listing Sponsor. [40] On the resignation of TA Securities, the respondent took cognisance that it had expressly stated in its letter dated 30.11.2020 that it had resigned as the parties were unable to reach an agreement on the proposed regularisation plan and business plan that the applicant intended to undertake. [41] As to the issue of legitimate expectation, with respect, I am in agreement with learned counsel for the respondent that in law, for legitimate expectation to arise, there must be evidence of a promise or undertaking made by the respondent to that effect; see Zakiah bte Ishak v Majlis Daerah Hulu Selangor Darul Ehsan [2005] 6 MLJ 517 CA. [42] As can be seen from the factual matrix, the granting of the various EOTs was not absolute. The respondent was not given the impression that the EOT would be granted as a matter of course in future applications. On the contrary, the respondent had made it clear repeatedly to the applicant that failure to comply with the prescribed EOT could result in de-listing. For example, in the letter dated 13.1.2021, the respondent made it clear that it had, despite the granting of the EOT, decided to de-list the applicant company in the event that it failed to appoint the Listing Sponsor on or before 1.3.2021. [43] As to the temporary relief measures, Cik Tan explained that the announcement made by the respondent on 26.3.2020 had made it clear that they do not apply to companies that had triggered the prescribed criteria under GN3 before 2019, such as the applicant. [44] This is not to say that the respondent had ignored the impact of the Covid 19 pandemic altogether in arriving at the impugned decision. In the same announcement, the respondent noted in para 9: For listed corporations which have triggered the Criteria before 2019 and which have been granted an extension of time by the Exchange prior to this Letter, they are still required to submit their regularisation plans with the approved timeframe granted. If further extension of time is required by these listed corporations, an application for the same must be made to the Exchange. The Exchange will consider such applications on a case-to-case basis taking into account, among others, the constraints faced by the listed corporations due to COVID-19 and the MCO. [45] With respect, I do not find any conflict in the respondent’s policy and the impugned decision as learned counsel urged this Court to conclude. The respondent had given every opportunity for the applicant to replace TA Securities as the Listing Sponsor. It has also taken into account the constraints faced by the applicant due to Covid-19 and the MCO. In short, the impugned decision could not be said to be tainted with Wednesbury's unreasonableness. [46] I must emphasise that the applicant's assertion that, but for the MCO, the replacement Listing Sponsor would have been appointed by the applicant is purely speculative. On many occasions, Encik Goh mentioned “potential Sponsor candidates” in his affidavits in support. According to Encik Goh, the potential sponsor candidates needed more time to meet all compliance issues and carry out the verification exercise on the applicant’s company directions. [47] In the absence of any documentary evidence concerning any communications between the applicant and the so-called potential Sponsor candidates, Encik Goh’s affirmation remains what it is – a bare assertion. [48] In any event, despite the passage of time since the filing of this judicial review application on 10.6.2021, the applicant has not applied for leave to file a further affidavit as to whether it has managed to replace the Listing Sponsor or submit the regularisation plan to the respondent. [49] In the circumstances of the case, it is my finding the impugned decision is not tainted with procedural impropriety and Wednesbury unreasonableness. The applicant has also failed to establish any legitimate expectation to make the impugned decision amenable to judicial review. [50] The application for judicial review is dismissed with costs of RM10,000 subject to allocatur. Tarikh: 7 Julai 2022 (WAN AHMAD FARID BIN WAN SALLEH) Hakim Mahkamah Tinggi Kuala Lumpur.