Wong Chong Kiew v Samalega Sdn Bhd (BA-24NCC-103-09/2023)

SAMALEGA SDN BHD [No. Syarikat: 201201026418 (1010908-P)]

TAN KENG THYE (No. K/P: 630423-07-6127)

LEE HOCK SENG (No. K/P: 631003-07-6029) … DEFENDAN-DEFENDAN GROUNDS OF JUDGMENT

The Plaintiff initiated this application in enclosures 1 and 3, seeking declaratory and injunctive reliefs under section 223 of the Companies Act 2016 (CA 2016), alleging that the disposal of the sole property owned by the First Defendant, Samalega Sdn Bhd (the Company), was conducted in contravention of statutory requirements.

The Plaintiff argued that the disposal was carried out without her knowledge or approval as a shareholder, undermining her rights and interests in the Company.

The Defendants opposed the application on multiple grounds. First, they contended that the property was disposed of in compliance with section 223 of the CA 2016, as the shareholders had duly approved it through a properly convened extraordinary general meeting

Second, they argued that the Plaintiff’s application was barred by the doctrine of res judicata, asserting that the issues raised in this case had already been adjudicated and dismissed in a prior application for leave to commence derivative action application filed by the Plaintiff.

Finally, the Defendants submitted that the Plaintiff’s actions in repeatedly obstructing the disposal of the property were not made in good faith and amounted to an abuse of the Court’s process.

Upon careful consideration of the evidence, submissions, and legal principles, this Court found no basis to grant the Plaintiff’s application. The following are the detailed grounds for my decision.

Samalega Sdn Bhd (“the Company”), the First Defendant, was incorporated on 23 July 2012 with a paid-up capital of RM100,000, divided equally between its two shareholders and directors: the Second Defendant, Tan Keng Thye, and the Third Defendant, Lee Hock Seng. Both individuals held 50% of the Company’s shares upon incorporation.

The primary objective of the Company was the acquisition and management of real estate properties for rental income. Since its incorporation, the Company’s sole asset has been a 3-storey semi- detached shop/office at No. 7, Jalan Pekaka 8/1D, Kota Damansara, Petaling Jaya, Selangor (the Property).

In 2013, the Company purchased the said Property for RM4,330,000.00. To finance this purchase, the Second and Third Defendants, acting in their personal capacities, obtained a loan of RM3,470,000.00 from Public Bank Berhad.

The said Property was rented out to tenants to generate rental income, which became the Company's sole revenue source. However, the monthly rental collected (RM10,000.00) consistently fell short of the monthly loan repayment of RM21,770.00. From the outset, the Second and Third Defendants personally covered this shortfall.

The Plaintiff, Wong Chong Kiew, is the ex-wife of the Third Defendant. Following their divorce in 2019, a decree nisi was issued on 29 March 2019, requiring the Third Defendant to transfer half of his 50% shareholding in the Company to the Plaintiff. As a result, the Plaintiff became a 25% shareholder in the Company, while the Second and Third Defendants retained 50% and 25% of the shares, respectively.

The decree nisi also awarded the Plaintiff shares in other companies owned by the Third Defendant, along with a portion of his savings and assets. Since the divorce, tensions have persisted between the Plaintiff and the Third Defendant, with the Plaintiff initiating multiple legal proceedings against the Third Defendant and companies in which he holds a position as director.

The financial health of the Company has been a persistent challenge. The said Property, its sole asset and income source, has not been able to generate enough rental income to cover the monthly loan repayment.

The situation worsened after the expiration of tenancy agreements in March 2020. The COVID-19 pandemic and the imposition of Movement Control Orders caused a significant decline in demand for commercial properties, leaving the said Property vacant for an extended period.

During this time, the Second and Third Defendants continued to bear the shortfall between rental income and loan repayments while exploring options to mitigate losses.

To address the Company’s financial difficulties, the Defendants proposed to dispose of the said Property. The Property was first offered to the Plaintiff for purchase, but she declined the offer through her solicitors in a letter dated 2 November 2020. The Plaintiff explicitly instructed the Defendants to sell the Property to third parties.

Despite this initial instruction, the Plaintiff later opposed subsequent efforts to sell the Property. She raised concerns about the lack of a valuation report and objected to the proposed sale price. In response, the Defendants commissioned two valuations: a. Chartwell Itac International (Kajang) Sdn Bhd: valued the Property at RM4,330,000.00. b. CH Williams Talhar & Wong Sdn Bhd: valued the Property, at the Plaintiff’s request, at RM4,200,000.00.

Despite these valuations, the Plaintiff continued obstructing the sale, causing delays and financial strain on the Company.

In July 2022, the Defendants secured a new offer of RM4,700,000.00 for the Property—a price significantly higher than both valuations. An Extraordinary General Meeting (EGM) was held on 26 September 2022, during which the resolution to dispose of the Property was approved. However, the Plaintiff filed an Originating Summons dated 30 November 2022, for leave to commence derivate action for the Company, to prevent the sale, claiming to act in the Company’s interest.

The Plaintiff also lodged a private caveat on the said Property to restrain its sale. The Defendants contended that the Plaintiff lacked a caveatable interest in the Property, as it belonged to the Company and not to her personally.

The Plaintiff justified her actions by asserting that she sought to protect the Company and its shareholders' interests. However, the Defendants argued that her actions were inconsistent with the Company’s commercial interests.

The Plaintiff also refused to contribute funds to address the Company’s financial difficulties, despite being a 25% shareholder and fully aware of the loan repayment shortfall. The Defendants argued that her refusal to mitigate the Company’s losses, coupled with her persistent obstruction of the sale, was detrimental to the Company’s financial health.

Throughout the dispute, multiple EGMs were convened to discuss the disposal of the Property and other financial matters. Despite objections from the Plaintiff, the majority of shareholders consistently approved the Defendants’ proposals to address the Company’s financial challenges.

At the EGM on 26 September 2022, the resolution to sell the Property for RM4,700,000.00 was approved. The sale price exceeded the market value determined by both valuation reports, but the Plaintiff continued to oppose the sale, citing irrelevant comparisons to property transactions from 2015.

The Defendants emphasised that the disposal of the said Property was a commercial decision aimed at mitigating the Company’s losses. They highlighted that: a. the Company’s sole income from rental was insufficient to cover loan repayments. b. the Plaintiff refused to contribute funds or offer viable alternatives. c. the offer price of RM4,700,000.00 exceeded the valuations and represented the best opportunity to reduce losses.

The Defendants maintained that the Plaintiff’s actions were not in the best interests of the Company and were motivated by personal grievances.

The primary issues before the Court are: a. whether the resolution for the disposal of the said Property complied with the requirements of section 223 of the CA 2016. b. whether the Plaintiff’s application is barred by the doctrine of res judicata. c. whether the Plaintiff acted in good faith and disclosed all material facts in this application. d. whether the reliefs sought by the Plaintiff are academic given the subsequent sale of the said Property. ANALYSIS OF THE EVIDENCE AND FINDINGS OF THE COURT Whether the resolution for the disposal of the said Property complied with the requirements of section 223 of the CA 2016.

Section 223 CA 2016 governs the disposal of substantial assets by a company, requiring shareholders’ approval through an ordinary resolution passed in a general meeting. This statutory safeguard ensures transparency, accountability, and the protection of shareholders’ interests in major transactions. The central issue in this case is whether the Defendants adhered to these requirements when resolving to dispose of the said Property.

The Plaintiff argued that the Defendants failed to comply with the mandatory requirements under section 223 of the CA 2016. Specifically, the Plaintiff contended: a. no valid Members’ Resolution or Company Resolution was passed prior to the disposal of the said Property, which is a substantial portion of the Company’s assets. b. the Plaintiff highlighted that the Notice of Members’ Meeting dated 29 August 2022 for a meeting on 26 September 2022 failed to attach the requisite resolution as required under Section 223 of the CA 2016. c. minutes of the Members’ Meeting (Enclosure 2, Exhibit CK-8) failed to show approval of the resolution by a majority of shareholders.

The Plaintiff also pointed out that the Sale and Purchase Agreement dated 26 January 2023 clearly required Members’ Resolutions, but none was produced.

The Plaintiff alleged that the Defendants' reliance on a Directors’ Resolution is invalid as directors lack authority under section 223 of the CA 2016 to dispose of substantial assets without shareholders’ approval.

The Plaintiff asserted that the sale price of RM4,700,000 lacked sufficient justification and transparency.

The Plaintiff relied on the Court of Appeal case of Concrete Parade Sdn Bhd & Ors v Apex Equity Holdings Bhd [2021] 9 CLJ 849 in support of her argument.

The Defendants contended that the disposal of the said Property by the Company fully complied with the requirements of section 223 of the CA 2016, which governs the disposal of assets constituting a substantial portion of a company’s property or undertaking.

The Defendants emphasised that the disposal of the said Property was properly approved by the shareholders of the Company during an EGM held on 26 September 2022.

Notice of the EGM: a. a notice for the EGM, with an agenda that specifically included the disposal of the said Property, was duly issued to all shareholders, including the Plaintiff. b. the Plaintiff acknowledged receiving the notice and was represented at the meeting by her proxy, her solicitor from Messrs Rajindar Singh Veriah & Co.

Resolution Passed by Majority: a. during the EGM, the shareholders, including the Plaintiff’s proxy, were given the opportunity to discuss the agenda. b the resolution to approve the disposal of the Property was passed by the required majority, in full compliance with the statutory provisions of section 223 of the CA 2016.

The Defendants argued that the Plaintiff, through her proxy, raised objections to the valuation report during the EGM but did not challenge the validity of the meeting or the resolution at that time.

The Defendants highlighted that the Plaintiff was fully aware of the discussions and the resolution passed during the EGM, as evidenced by: a. her representation at the EGM by her proxy, who actively participated in the meeting and voiced objections regarding the valuation report. However, the Plaintiff provided no alternative solutions to mitigate the Company’s financial difficulties. b. her continued communication with the Defendants regarding the valuation and the disposal process after the EGM.

Therefore, the Defendants argued that the Plaintiff was estopped from alleging that the disposal contravened section 223 of the CA

Use of Valuation Reports to Safeguard Shareholders’ Interests

To ensure transparency and compliance with section 223 of the CA 2016, the Defendants undertook the following measures: a. First Valuation Report: i. the Defendants initially commissioned Chartwell Itac International (Kajang) Sdn Bhd, which valued the said Property at RM4,330,000.00, close to the earlier offer price of RM4,400,000.00. ii. despite the valuation aligning with market expectations, the Plaintiff objected to its validity and demanded a second valuation. b. Second Valuation Report: i. to address the Plaintiff’s objection, the Defendants engaged CH Williams Talhar & Wong Sdn Bhd, whose valuation report dated 13 December 2021 valued the Property at RM4,200,000.00, which was lower than both the earlier valuation and the new offer price of RM4,700,000.00. ii. the Defendants contended that the valuations demonstrated that the disposal price was fair, reasonable, and in the best interests of the Company.

The Defendants further contended that the disposal of the said Property was a decision commercially necessary aimed at mitigating the financial losses of the Company for the following reasons: a. the Company’s sole source of income was rental collected from the tenants of the said Property, which was insufficient to cover the monthly loan repayment. b. the monthly rental income of RM10,000.00 fell significantly short of the loan repayment of RM21,770.00, resulting in substantial losses for the Company. c. the Second and Third Defendants personally bore the shortfall between the rental income and the loan repayments. d. the rental market was severely affected during the Movement Control Order and Conditional Movement Control Order, leaving the said Property without tenants for an extended period. e. the absence of rental income exacerbated the financial strain on the Company, necessitating the disposal of the Property.

The Defendants contended that they secured an offer of RM4,700,000.00 for the said Property, which was higher than the market value determined by both valuation reports.

The Defendants claimed that rejecting such an offer would be detrimental to the Company’s financial health.

The Defendants relied on the principle that the board of directors is vested with the authority to manage the business and affairs of the company. Section 211 of the CA 2016 provides that the management of a company’s business is the responsibility of its directors, and the shareholders cannot interfere with decisions made within the board’s powers.

The Defendants explained that the decision to dispose of the said Property was a commercial decision made by the board of directors in good faith.

The Defendants contended that the resolution passed at the EGM complied with all statutory requirements and reflected the collective will of the shareholders.

The Plaintiff’s continued objections to the disposal were not in the best interests of the Company and amounted to interference with the board’s management prerogative.

Therefore, in conclusion, the Defendants argued that: a. the disposal of the said Property complied with section 223 of the CA 2016, as it was approved by the shareholders in a properly convened EGM. b. the Plaintiff’s allegations of non-compliance were baseless, as she was fully aware of the disposal process, participated in the EGM, and had ample opportunity to voice her objections. c. the Plaintiff’s actions in filing this application were an abuse of the Court’s process, as the disposal was conducted transparently, in good faith, and in accordance with the law.

Upon examining the submissions and evidence presented, this Court finds that the Defendants have demonstrated compliance with section 223 of the CA 2016.

The evidence shows that the Plaintiff was given due notice of the EGM where the resolution for the disposal of the Property was discussed and voted upon. The Plaintiff’s proxy actively participated in the meeting, raising objections and requesting further valuations. This indicates that the Plaintiff was not excluded from the decision-making process.

The resolution to sell the Property was passed by a majority vote at the EGM, as required by section 223 of the CA 2016. The Plaintiff’s dissent does not invalidate the resolution, as the law requires approval by the majority, not unanimity (refer to the case of Dato’ Azizan Abd Rahman & Ors v Concrete Parade Sdn. Bhd. & Ors And Other Appeals [2024] 5 CLJ 193 [FC]).

The Defendants obtained two separate valuation reports from independent valuers, both of which assessed the market value of the Property to be lower than the agreed sale price of RM4,700,000. This demonstrates that the Defendants acted in good faith to secure the best possible outcome for the Company.

The Plaintiff failed to provide any evidence of procedural irregularities in the conduct of the EGM or the passing of the resolution. The allegations of non-compliance with section 223 of the CA 2016 are unsubstantiated and appear to be speculative.

The decision to sell the Property was necessitated by the Company’s financial position. The rental income from the Property was insufficient to cover the loan repayments, and the sale was essential to prevent further financial losses. The Plaintiff’s objections to the sale lacked any viable alternative to address the Company’s financial difficulties.

The Plaintiff’s conduct in obstructing the sale, despite being given an opportunity to purchase the Property herself, undermines her credibility and raises questions about her motives.

In conclusion, this Court finds that the Defendants complied with the requirements of section 223 of the CA 2016 in passing the resolution for the disposal of the said Property. The Plaintiff’s allegations of non-compliance are without merit and are not supported by any credible evidence. The resolution was duly passed in accordance with the statutory requirements and was a necessary step to safeguard the financial stability of the Company. Accordingly, the Plaintiff’s application is dismissed on this ground. Whether the Plaintiff’s application is barred by the doctrine of res judicata.

The doctrine of res judicata, a foundational principle in legal jurisprudence, prevents parties from relitigating issues that have already been adjudicated or could and should have been raised in prior proceedings. The rationale for this doctrine is to uphold the finality of judgments, prevent abuse of court’s process, and ensure judicial economy (see: Asia Commercial Finance (M) Berhad v Kawal Teliti Sdn Bhd [1995] 3 CLJ 783).

The Defendants argued that the Plaintiff’s current application is barred by res judicata because the same subject matter, involving the disposal of the said Property, was previously adjudicated in the Plaintiff’s earlier application for leave to commence a derivative action in Kuala Lumpur High Court Originating Summons No.: WA- 24NCC-1047-11/2022. The High Court dismissed the leave application on 25 August 2023, finding that the Plaintiff’s allegations lacked merit and were brought in bad faith.

The Defendants submitted that the parties involved in the Plaintiff’s current application are identical to those in the previous application for leave to commence derivative action. The Plaintiff is the same individual seeking relief, and the Defendants are the same individuals and entities opposing it.

Furthermore, the Plaintiff’s affidavit in the earlier proceedings specifically highlighted objections to the disposal of the said Property, particularly alleging that the Property’s sale lacked a proper valuation report and failed to account for the shareholders’ approval.

The Plaintiff also raised similar arguments in the earlier proceeding, including alleged non-compliance with section 223 of the CA 2016 and claimed that the disposal was detrimental to the interests of the Company and its shareholders.

The High Court dismissed the Plaintiff’s leave application on the ground that it was brought in bad faith. The judgment noted that the Plaintiff failed to provide any concrete evidence to support her allegations of wrongdoing or undervaluation in the disposal of the Property. The Court emphasised that the Plaintiff merely raised suspicions and speculative assertions, which did not warrant judicial intervention.

The High Court also highlighted that the Plaintiff had been given an opportunity to purchase the Property herself if she believed the sale price was below market value but chose not to do so.

These findings remain unchallenged, as the Plaintiff did not appeal the High Court's decision.

The Defendants relied on the case of Lim Lek Yan v Yayasan Melaka [2013] 1 CLJ 1081, where the Court held that res judicata applies not only to issues expressly decided but also to those that should have been raised and that the doctrine bars any subsequent litigation that amounts to an abuse of process by rehashing settled issues.

Additionally, the case of Huawei Tech Investment Co. Ltd. v Transition Systems (M) Sdn Bhd [2013] 5 MLJ 396 (COA) reinforces that res judicata extends to issues that “could and should” have been litigated in earlier proceedings.

The Plaintiff rebutted the Defendants' argument of res judicata by asserting that the issues in the Plaintiff's previous application for leave to commence derivative action under Suit No. WA-24NCC- 1047-11/2022 were distinct from those in the present proceedings. The said action involved issues under section 347 of the CA 2016, whereas the current claim is based on section 223 of the CA 2016 concerning the disposal of the Property.

The Plaintiff argued that the broad grounds of the earlier decision did not address the issue of Members’ Resolutions or compliance with section 223 of the CA 2016. Therefore, res judicata does not apply as the present claim raises a new and independent issue.

The Plaintiff argued that for res judicata to apply, the issues must have been conclusively decided in the earlier case. The Plaintiff maintained that no such decision was made in the application for leave to commence derivative action.

This Court finds that the Plaintiff’s application is indeed barred by the doctrine of res judicata.

The Plaintiff and the Defendants are the same parties involved in the earlier proceeding. Additionally, the disposal of the said Property was the central subject matter in both cases. The Plaintiff’s arguments concerning alleged non-compliance with section 223 of the CA 2016 and the propriety of the members’ resolution were explicitly raised and addressed in the earlier application.

The Plaintiff had a full and fair opportunity to present her case in the earlier proceeding. The affidavits filed by the Plaintiff in the High Court demonstrate that the issues surrounding the members’ resolution and the disposal of the Property were already considered by the Court. The Plaintiff’s failure to appeal the High Court’s decision further solidifies the finality of that judgment.

The High Court’s dismissal of the Plaintiff’s leave application represents a final adjudication on the merits. The Court’s findings that the Plaintiff acted in bad faith and failed to establish a prima facie case for leave to commence derivative action preclude her from reasserting similar claims in this application.

It is trite that res judicata encompasses two aspects: cause of action estoppel and issue estoppel. a. Cause of Action Estoppel: This prevents a party from litigating a cause of action that has already been decided. The Plaintiff’s grievances about the disposal of the said Property were already addressed in the application for leave to commence derivative action. b. Issue Estoppel: This bars parties from relitigating specific issues of fact or law that were decided in earlier proceedings, even if the subsequent suit is based on a different cause of action. The Plaintiff’s claim that the Members’ Resolution was invalid was explicitly rejected by the High Court in the application for leave to commence derivative action and cannot be revisited here.

Hence, the Plaintiff’s attempt to reframe her claims does not circumvent the doctrine of res judicata.

The present application constitutes an abuse of the Court’s process for several reasons: a. the Plaintiff failed to raise any new facts or evidence that distinguish this application from the earlier application for leave to commence derivative action. b. the Plaintiff delayed filing this application for nearly a year after the Members’ Resolution was passed, undermining her credibility and demonstrating a lack of urgency or good faith. c. the Plaintiff’s attempt to relitigate the same issues is a blatant effort to obtain a “second bite at the cherry”.

In conclusion, allowing this application to proceed would not only violate the principles of res judicata but also constitute an abuse of the Court’s process. Accordingly, this ground alone provides a strong basis for dismissing the Plaintiff’s application. Whether the Plaintiff acted in good faith and disclosed all material facts in this application.

One of the central issues raised by the Defendants is whether the Plaintiff acted in good faith in filing this application and whether all material facts were disclosed to the Court.

The principle of good faith is essential in applications for declaratory and injunctive reliefs, particularly when the applicant seeks to restrain actions already approved through proper corporate processes. Furthermore, full and frank disclosure of all material facts is a prerequisite for obtaining equitable reliefs such as injunctions.

The Defendants argued that the Plaintiff did not act in good faith.

The Defendants submitted that the Plaintiff’s application was not genuinely filed to protect the interests of the Company or its shareholders but was instead motivated by personal animosity towards the Third Defendant, her ex-husband.

The Defendants pointed to the Plaintiff’s history of litigation against the Third Defendant and his companies, including multiple legal proceedings in the High Court and Court of Appeal to demonstrate a pattern of vexatious behaviour intended to harass and obstruct the Third Defendant.

The Defendants highlighted that the Plaintiff filed this application almost a year after the resolution to dispose of the Property was passed at the EGM on 26 September 2022.

They argued that the Plaintiff deliberately waited until the High Court dismissed her application for leave to commence a derivative action on 25 August 2023 before filing this application. This sequence of events suggests a lack of bona fides, as the Plaintiff had ample opportunity to challenge the resolution earlier but chose not to do so.

The Defendants contended that the Plaintiff failed to disclose several material facts, including: a. the Plaintiff’s knowledge of the sale of the Property, as evidenced by her attendance at the EGM on 26 September 2022 and her correspondence with the Defendants. b. the Plaintiff’s initial consent to the disposal of the Property, as demonstrated by letters from her solicitors directing the Defendants to sell the Property to third parties. c. the Defendants’ compliance with statutory requirements and corporate processes, including obtaining multiple valuation reports and approval of the resolution at the EGM.

The Defendants further contended that the Plaintiff acted in bad faith by lodging a private caveat on the said Property without any legal or equitable interest to support such an action. They referred to the Kuala Lumpur High Court’s decision in the Company’s application to remove the private caveat. The High Court, after hearing the application, declared that the Plaintiff’s caveat was legally invalid, unlawful, and void. The Court further found that the Plaintiff had acted in bad faith by entering the private caveat, as she lacked any legitimate claim to the said Property.

The Defendants argued that the Plaintiff’s application constitutes an abuse of the Court’s process, as it seeks to relitigate issues that were or could have been raised in her previous application for leave to commence a derivative action.

The Defendants emphasised that the doctrine of res judicata applies to bar the Plaintiff from pursuing this claim, as the High Court had already dismissed her application for leave to commence derivative action on the basis of a lack of good faith.

The Plaintiff asserted that she acted in good faith as a 25% shareholder in bringing the application to protect the interests of the Company. The Plaintiff contended that the application was filed after discovering the Defendants’ non-compliance with section 223 of the

The Plaintiff further contended that she had disclosed all material facts, including details of prior proceedings and objections raised at the Members’ Meeting on 26 September 2022.

The Plaintiff also emphasised that the Defendants acted in bad faith by failing to notify shareholders about the disposal, offering an incomplete notice, and concealing material information about the terms of the sale. The Plaintiff argued that these actions justified her application.

After careful consideration of the evidence and submissions, I find that the Plaintiff failed to demonstrate good faith in filing this application.

The Plaintiff’s significant delay in filing this application casts doubt on her claim of good faith. If the Plaintiff genuinely believed the resolution approving the disposal of the Property was invalid, she should have acted promptly following the EGM on 26 September 2022.

Instead, the Plaintiff waited nearly a year, only filing this application after her application for leave to commence derivative action was dismissed. This delay undermines her credibility and suggests an ulterior motive rather than a genuine concern for the Company’s interests.

This Court also finds that the Plaintiff failed to provide a complete and accurate narrative of the events leading to this application. Specifically, she omitted crucial details, including: a. her participation in the EGM where the resolution to sell the Property was approved. b. her prior consent to the sale of the Property, as reflected in correspondence from her solicitors. c. the Defendants’ proactive steps to comply with statutory requirements, obtain multiple valuation reports and conduct a transparent approval process to secure the best possible price for the Property.

These omissions demonstrate a lack of candour and transparency, which are critical to seeking equitable relief.

The High Court, in dismissing the Plaintiff’s application for leave to commence derivative action, determined that the Plaintiff acted in bad faith. The Court found her allegations speculative, unsupported by evidence, and motivated by collateral purposes rather than genuine concern for the Company’s welfare. These prior judicial findings are directly relevant and further substantiate the conclusion that the Plaintiff’s actions lack bona fides.

This Court also took note of the findings by the Kuala Lumpur High Court, which declared that the Plaintiff’s lodging of a private caveat on the said Property was unlawful, void, and done in bad faith. The High Court’s determination that the Plaintiff lacked any legal or equitable interest in the Property and had acted maliciously in entering the caveat supports the contention that the Plaintiff has not acted in good faith in this matter.

Injunctive relief is an equitable remedy that requires applicants to approach the Court with clean hands. The Plaintiff’s delay, lack of disclosure, and apparent improper motives disqualify her from obtaining such relief. Her conduct reflects an attempt to misuse the Court’s process, contrary to the principles of equity.

In light of the above, I find that the Plaintiff has not acted in good faith in filing this application. Her lack of transparency, delay, and collateral purpose undermine her credibility and render her application unsustainable. These factors collectively constitute a key basis for dismissing the Plaintiff’s application. Whether the reliefs sought by the Plaintiff are academic given the subsequent sale of the said Property.

The Defendants argued that the reliefs sought by the Plaintiff have become academic due to the subsequent sale of the said Property, which was completed after the Members’ Resolution was passed and duly approved.

The Defendants submitted that the sale of the said Property was finalised in accordance with the resolution passed during the EGM on 26 September 2022.

The Defendants emphasised that the Property is no longer under the ownership of the Company, rendering any injunctive relief irrelevant and inapplicable.

The Defendants argued that the reliefs sought by the Plaintiff, including the setting aside of the Members’ Resolution, would have no practical effect given that the sale is complete.

The Defendants referred to the Federal Court decision in Tan Sri Musa bin Hj Aman v Tun Datuk Seri Panglima Hj Juhar Hj Mahiruddin & Anor and another appeal [2020] 3 MLJ 46, which held: “The court would not exercise its discretionary power to make a declaratory judgment when the issue in dispute was purely academic. The court should not be required to answer an academic question or issue which was no longer a live one.”

The Defendants contended that any decision on the Members’ Resolution would amount to an academic exercise, as the relief sought cannot undo the sale or affect its validity.

The Defendants further argued that revisiting the issue would undermine the principles of commercial certainty and finality. The purchaser of the said Property is a bona fide third party who acquired the property in good faith and for valuable consideration. Any interference at this stage would unfairly prejudice the purchaser and disrupt established commercial expectations.

The Defendants pointed out that the Plaintiff’s delay in filing this application contributed to the completion of the sale. The Plaintiff failed to act promptly after the EGM or during the negotiation and execution of the Sale and Purchase Agreement, thereby forfeiting her opportunity to challenge the resolution in a timely manner.

The Plaintiff contended that the reliefs sought in this application, including injunctive and declaratory reliefs, remain relevant despite the sale of the said Property.

The Plaintiff maintained that the Members’ Resolution approving the disposal of the said Property was procedurally flawed and did not comply with section 223 of the CA 2016.

The Plaintiff asserted that the invalidity of the resolution tainted the sale, and the Court’s intervention is necessary to rectify the alleged non-compliance and protect shareholders’ rights.

The Plaintiff argued that as a shareholder of the Company, she has a continuing interest in ensuring that the Company’s decisions comply with statutory requirements.

The Plaintiff further contended that the disposal of the sole asset of the Company without proper compliance with statutory provisions could set a detrimental precedent and warrant judicial scrutiny.

The Plaintiff emphasised the importance of equitable remedies to address any procedural irregularities and to uphold the integrity of corporate governance.

This Court finds that the reliefs sought by the Plaintiff have indeed become academic due to the subsequent sale of the said Property.

The sale of the said Property was completed pursuant to the resolution passed during the EGM. The Property is no longer owned by the Company and the reliefs sought by the Plaintiff cannot undo the sale or affect the purchaser’s rights.

The reliefs sought by the Plaintiff would have no practical effect, as the sale is final and binding. The decision in Tan Sri Musa bin Hj Aman v Tun Datuk Seri Panglima Hj Juhar Hj Mahiruddin & Anor and another appeal (supra) underscores that courts should not entertain academic or moot issues that lack real-world implications for the parties.

The purchaser of the said Property acted in good faith and for valuable consideration. Interfering with the completed transaction would prejudice the purchaser and disrupt the principles of commercial certainty.

The Plaintiff’s delay in filing this application undermines her claim. She failed to act promptly after the resolution was passed, and her inaction allowed the sale to proceed to completion.

In light of the above, this Court finds that the reliefs sought by the Plaintiff are academic due to the completed sale of the said Property. The application is dismissed on this ground.

For the reasons stated above, I, therefore, ordered that the Plaintiff’s application in Enclosures 1 and 3 be dismissed with costs of

I further ordered that the Defendants’ Counterclaim be struck out with liberty to file afresh with no order as to costs. Dated: 31 December 2024 -sgd-JAMHIRAH ALI JUDGE High Court of Malaya at Shah Alam (NCVC 1) To the parties’ solicitors: For the Plaintiff : Clinton Nicholas Gomez (Messrs Rajindar Singh Veriah & Co.) For the Defendants : Celena Chay (Messrs Lim Soh & Goonting)