Wong Man Fai Frankie v Tseng Freya Hemmon Fan Yea (WA-24NCC-321-07/2024)

TSENG FREYA HEMMON FAN YEA (Passport No: 525916769)

FOREBASE PROPERTY SDN BHD (Company No: 201601003121 (1174047-H)) … DEFENDANTS GROUNDS OF JUDGEMENT INTRODUCTION [1] This judgment concerns the Plaintiff’s application in Enclosure 182 to vary the Re‑Amended Ad Interim Injunction Order obtained on the 25th of March 2025, which relates to the withdrawal and use of monies in the Company’s Housing Development Account (HDA Account). The Plaintiff seeks an amendment to allow payments to be affected by way of Bank Remittance to third parties and authorities together with prescribed supporting documents and advance notice to the First Defendant; BACKGROUND FACTS [2] The Plaintiff (Frankie) is a Hong Kong SAR citizen and First Defendant (Freya), is a British citizen residing in Hong Kong. The Second Defendant, Forebase Property Sdn Bhd (The Company) was incorporated in 2016 in which both parties held 50% shareholdings, and the directors of the Company. [3] The Company was established for a housing project called, The Hemmon House Residensi (The Project) at No.1, Jalan Inai, Imbi, 55100 Kuala Lumpur, opposite the Ritz Carlton Hotel. The Project involved constructing a 40-storey building comprising, 90 dual-key condominium units, launched in 2017 as the Company's only business activity. However, the Project had experienced significant delays which was originally scheduled for completion in April 2023, then revised again to September 2023 due to the deadlock between Frankie and Freya. 4] The Project was finally certified fit for occupation by the relevant authorities with the Certificate of Completion & Compliance issued

(CCC), and the Company was facing substantial accrued liabilities, and financial perils such as: - I. Liquidated Ascertained Damages (LAD), II. Utility and statutory liabilities, III. Pending Winding up proceedings and Judicial Management demands. [5] The Plaintiff is seeking an amendment, to allow payments to be effected by bank remittance to third parties and authorities, upon submission, together with prescribed supporting documents with advance notice to the Freya. However, Frankie now would like to remove or modify the existing joint‑signature mechanism for the HDA Account in Hong Leong Bank as the bank is refusing to issue a cheque book for the said bank account. [6] Freya on the other hand argues that the proposed amendments are to wide and open to abuse by Frankie. In brief, Frankie would be armed to make payments to anyone he deems fit to be a creditor. This will cause serious prejudice and detriment to the Company if check and balances are not in place, creating preferential treatment and misappropriation of Company funds. Re‑Amended Ad Interim Injunction Order dated 25.03.2025 [7] This Court, by Tuan Attan Mustapa Yussof Ahmad J, on 25.03.2025, had granted a re-amendment order, authorising Frankie, to take steps needed to secure certification and to attend to certain pressing operational matters. These orders were imposed as a general safeguard to the withdrawals from the Company’s bank accounts by cheques, that are to be jointly signed by both directors i.e. the joint‑signature requirement. [8] The previous Re‑Amended Ad Interim Injunction Order dated 25.03.2025, allowed the following: -

Plaintif dibenarkan untuk melaksanakan perkara-perkara berikut bagi Defendan Kedua:-

11.1. Untuk berurusan dengan pihak-pihak berkuasa yang berkaitan, termasuk menyerahkan Laporan Kemajuan Kewangan kepada

11.2. Untuk mengeluarkan Sijil Penilaian (Valuation Certificate) kepada Aino Furnishing Sdn Bhd bagi kerja-kerja yang telah dilaksanakan olehnya tertakluk kepada semakan dahulu dan pengesahan oleh profesional berkelayakan yang bebas yang akan dilantik oleh Defendan Pertama;

11.3. Untuk melantik peguam untuk mewakili Defendan Kedua dalam prosiding Timbang Tara di Pusat Timbang Tara Antarabangsa (AIAC) yang dimulakan oleh Hubei Dijian Construction (Malaysia) Sdn Bhd terhadap Defendan Kedua;

11.4. Untuk menguruskan semua perkara seperti yang diminta oleh RHB Bank Berhad dan mana-mana pihak berkaitan lain berhubung dengan pencairan pinjaman, termasuk tetapi tidak terhad kepada mengeluarkan Surat berkenaan Pengesahan Bayaran Baki Perbezaan (Differential Sum Payment Confirmation) kepada Tetuan Donny & Ong dan Surat Induk Aku Janji (Master Letter of Undertaking) kepada RHB Bank

11.5. Untuk mengemukakan tuntutan kepada Akaun Pembangunan Perumahan (Housing

11.6. Setelah menerima dana daripada tuntutan ke atas Akaun Pembangunan Perumahan Defendan Kedua dan pelepasan pinjaman daripada bank-bank kepada Defendan Kedua, untuk mengatur supaya Defendan Kedua menggunakan dana tersebut untuk menyelesaikan semua hutang tertunggak yang terhutang oleh Defendan Kedua kepada mana-mana pihak ketiga dan/atau pihak berkuasa, tertakluk kepada penyediaan senarai terperinci pemiutang, jumlah yang terhutang, dan jadual pembayaran yang dicadangkan kepada Defendan Pertama sekurang-kurangnya tujuh hari sebelum sebarang pembayaran dibuat, dengan keutamaan diberikan kepada pembayaran yang perlu bagi mengelakkan tindakan undang undang atau penalti statutori, serta menyimpan rekod yang lengkap bagi semua pembayaran yang telah dibuat……. [9] The new amended / variation for Re‑Amended Ad Interim Injunction in Enclosure 182 requested by Frankie are contained in paragraph 13 as follows:-

Bagi tujuan untuk melaksanakan Perenggan-Perenggan 11.5 dan 11.6 di atas: -

13.1. Plaintif dibenarkan untuk mengatur pengemukaan Borang Pemindahan Wang Bank (Bank Remittance Form) yang disediakan oleh Hong Leong Bank Berhad, bersama-sama dengan salinan surat yang dikeluarkan oleh Defendan Kedua yang ditandatangani hanya oleh Plaintif, dan disertakan dengan dokumen-dokumen sokongan yang berkaitan berhubung dengan pembayaran-pembayaran yang akan dibuat secara langsung kepada mana-mana pihak berkuasa dan/atau pihak ketiga (mengikut mana yang berkenaan) (Tuntutan), kepada Hong Leong Bank Berhad, bagi tujuan pengeluaran dana secara langsung daripada Housing Development Account-HDA no. 00100923843 di Hong Leong Bank Berhad cawangan Kuala Lumpur Main Branch. (“Akaun HDA”) yang dimiliki oleh Defendan Kedua untuk melaksanakan Perenggan 11.5 dan 11.6 di atas;

13.2. Untuk mengelakkan sebarang keraguan, Plaintif dibenarkan untuk membuat pembayaran-pembayaran tersebut daripada Akaun HDA tersebut secara langsung kepada mana-mana pihak ketiga dan/atau pihak berkuasa (mengikut mana yang berkenaan) melalui Borang Pemindahan Wang Bank (Bank Remittance Form) dan cara-cara sepertimana yang dinyatakan di Perenggan 13.1 di atas, untuk menyelesaikan semua hutang tertunggak yang terhutang oleh Defendan Kedua kepada mana-mana pihak ketiga dan/atau pihak berkuasa, tertakluk kepada penyediaan senarai terperinci pemiutang, jumlah yang terhutang, dan jadual pembayaran yang dicadangkan kepada Defendan Pertama sekurang-kurangnya tujuh hari sebelum sebarang pembayaran dibuat, dengan keutamaan diberikan kepada pembayaran-pembayaran yang perlu bagi mengelakkan tindakan tindakan undang-undang atau penalti-penalti statutori, serta menyimpan rekod yang lengkap bagi semua pembayaran yang telah dibuat. [10] It is important to note that, in delivering his judgement, Tuan Attan Mustapa Yussof Ahmad J took into the consideration all material changes, pressing financial matters and acknowledged the need for a re-amendment order as stated below: - “Issuance of the CCC and Project Completion” [53] The most significant change in circumstances since the granting of the injunction orders is the successful issuance of the CCC on 30.10.2024. This was made possible by this court's order on 9.9.2024 allowing Frankie to deal with JKKP and DBKL regarding inspections and certifications for the Project. [54] The issuance of the CCC marks a critical milestone in the Project's development, signifying that the building is fit for occupation. Importantly, it triggers several necessary subsequent steps, including: a) The delivery of vacant possession to the purchasers; b) release of funds from the HDA; c) The disbursement of loans from financial institutions; d) The settlement of outstanding debts and liabilities. ………… [80] After carefully considering the evidence, I find that the balance of convenience favours Frankie's position. Several factors support this conclusion. [81] First, Frankie has demonstrated his commitment to completing the Project by successfully obtaining the CCC. This required substantial work with the relevant authorities and represents a significant milestone. [82] Second, the continued accrual of LAD despite the CCC issuance represents an unnecessary financial burden on the Company. Allowing Frankie to proceed with delivering vacant possession would stop this financial bleeding. ………. “[160] In considering whether to vary the injunction order, I must assess where the balance of convenience lies. This involves weighing the potential harm to each party if the injunction is or is not varied. [161] If the injunction is not varied to allow Frankie to proceed with arrangements for the delivery of vacant possession, the Company will continue to incur substantial LAD, potentially facing further financial distress. The “Permohonan Penyerahan Milikan Kosong Tanpa Hakmilik Strata to the Ministry of Housing and Local Government” (KPKT) approval may lapse, requiring the Company to reapply and causing additional delays and expenses. This would effect not only the Company but also the purchasers who have been waiting for their units. [162] On the other hand, if the injunction is varied, Freya may have less control over the process of delivering vacant possession. However, as a director, she would still have the right to be informed of and provide input on the arrangements being made. The variation would not prevent her from exercising her oversight role; it would merely remove her ability to unilaterally block the process. [163] I find that the balance of convenience clearly favours varying the injunction order. The potential harm to the Company from continued delay is substantial and immediate, while any potential harm to Freya from allowing Frankie to proceed with arrangements is limited and can be mitigated through proper communication and reporting. [164] It is also worth noting that the purpose of the original injunction was to prevent Frankie from making unilateral decisions without consulting Freya, not to enable Freya to obstruct the Company's operations. Allowing Frankie to proceed with arrangements for the delivery of vacant possession, following the approvals by the relevant authorities, is consistent with the proper operations of the Company and does not undermine the purpose of the injunction.” The relevant Law on the power to vary Injunctions: [11] It is trite law that in several circumstances, Courts have the power to vary or discharge interlocutory injunctions, especially when there are material changes of circumstances or when the original order needs modification like in the present set of circumstances. [12] Order 42 Rule 13 of the Rules of Court 2012 provides that the Court has the power to vary an order: - “Save as otherwise provided in these Rules, where provisions are made in these Rules for the setting aside or varying of any order or judgment, a party intending to set aside or to vary such order or judgment shall make an application to the Court and serve it on the party who has obtained the order or judgment within thirty days after the receipt of the order or judgment by him.” Subsequently, Order 92 Rule 4 of the Rules of Court 2012 also provides that this Court has the inherent jurisdiction to make an order if necessary to prevent injustice: - “For the removal of doubt, it is hereby declared that nothing in these Rules shall be deemed to limit or affect the inherent powers of the Court to make any order as may be necessary to prevent injustice or to prevent an abuse of the process of the Court.” [13] In the case of Government of Malaysia v Lim Kit Siang; United Engineers (M) Berhad v Lim Kit Siang [1988] 2 MLJ 12where the Court held as follows: - “…Being an interlocutory injunction, learned counsel concedes that it is in a sense a provisional order and may be set aside or varied by a judge of the High Court but only if the aggrieved party can prove

a change of circumstances or new facts having come to light after August 25, 1987 and/or (b) suppression of material facts when applying for the interlocutory injunction before the Supreme Court on August 25, 1987. I agree with the contention of learned counsel for the respondent that the interlocutory injunction granted by the Supreme Court on August 25, 1987 can only be discharged or varied under the two circumstances set out in (a) and (b) above…” [14] In the case of WRP Asia Pacific Sdn Bhd & Anor v Tael Tijari Partners Ltd & Ors [2019] MLJU 1244 (HC), Ong Chee Kwan JC (as His Lordship then was) held that “This Court has the powers to vary and or set aside the Injunction Orders in the event there is a change of circumstances justifying the making of such an order.” His Lordship quoted from N.R Burns' “INJUNCTIONS: A Practical Handbook” that interlocutory injunctions may be dissolved or varied at any time “when changed circumstances made the relief as granted inappropriate, or when the original order is found to have been based upon a fundamental mistake.” “In Mullen v Howell (1879) 11 Ch. D at 766 Sir George Jessel M.R said: the court has jurisdiction over its own orders, and there is a larger discretion as to orders made on interlocutory applications than as to those which are final judgments.” When appropriate, interlocutory injunctions may be dissolved or varied at any time. This will be done, for example, when changed circumstances made the relief as granted inappropriate, or when the original order is found to have been based upon a fundamental mistake. An application for discharge may be granted if the plaintiff fails to prosecute the claim to final hearing with due diligence, in the case of an undertaking given to the court the appropriate course has been held to be a withdrawal of the initial undertaking and the substitution of another rather than an application to vary.” [15] Reference is also made to the case of The Store (Terengganu) Sdn Bhd v Abi Construction Sdn Bhd & Anor [2013] MLJU 1650 (HC), where the court held that an order for injunction may be discharged, varied, or set aside if the court is satisfied that there is a change of circumstances, or the order has caused undue hardship to that party. [16] In exercising this power, this Court also considered the continuing purposes of the original order, the need to prevent injustice and abuse, and the balance of convenience between the parties. In the present context, this Court paid attention, particularly to the following subject matter:

the HDA Account is a regulated account established under housing development legislation and the use of HDA funds is subject to statutory conditions and limitations; and

there is also a pending insolvency lawsuit, and the law governing dispositions of company property in the face of a winding‑up petition must be recognized. Accordingly, any variation must be tailored to preserve statutory compliance and avoid irreversible, unlawful dispositions. Material changes in circumstances since the court’s ruling above. [17] The court would like to express, that due to the deadlock between the two directors, the full completion of the said Project has been delayed a great deal and the Company’s operation has suffered tremendous undue hardships. The court notes that in order to ensure the smooth operation of the Company and to continue without further disruption, Frankie, in the best interest of the Company, took it upon himself to personally settle some of the outstanding bill payments to LHDN, TNB and Air Selangor. [18] Based on the current evidence provided by parties in their respective affidavits, the Plaintiff, had submitted claims for the HDA Account since funds are readily available, capable of being utilised for the purposes of urgent statutory, utility and other project related obligations. However, Hong Leong Bank has informed the Company that no cheque book will be issued for the HDA Account and the bank had declined to process any withdrawal by cheque for the HDA Account due to the internal conflict between both the directors. [19] As a consequence of the bank’s position and the continuing deadlock between the two directors, payment of urgent items, notably utilities and statutory payments were not practicable and tangible operational harm to the Company including termination of electricity supply and the commencement of claims by creditors started to accumulate. [20] In addition to that there were parallel proceedings effecting the Company’s position, including a winding‑up petition and a judicial management by creditor’s application, exposing the directors to personal liability unless validated and urgently addressed. Furthermore, Freya has also since to date, appealed against certain interlocutory variations, made pending stay applications and resisted unilateral access by the Plaintiff to the HDA funds. [21] The Plaintiff argued that in order to give full effect to Paragraphs 11.5 and 11.6 and to reflect their true meaning and intention, Enclosure 182 ought to be granted by this Court. Otherwise, the very purpose of Paragraphs 11.5 and 11.6 of the Re-Amended Ad Interim Injunction Order would be defeated. Furthermore, Frankie was very concerned that Freya will continue to exploit the impasse and abuse the Injunction Orders at hand by withholding her consent to the necessary payments required for the Company’s operations to continue as in the past. [22] The court agrees with the Plaintiff that there is no basis for Freya to object to this application, as the sole purpose of Enclosure 182 is to vary the Re-amended Ad Interim Injunction Order to reflect the true intention of Paragraphs 11.5 and 11.6 of the Re-Amended Ad Interim Injunction Order dated 25.03.2025 granting Frankie to:

submit the claims to the Company’s HDA Account, and

subsequently, the utilize the said funds once available in the Company’s HDA Account, subject to providing Freya the detailed list of creditors and supporting documents 7 days prior to such payment being made. [23] Paragraph 13 of Annexure A of Enclosure 182, supports the same contention of a safeguard measure by providing Freya the detailed list of creditors and supporting documents 7 days prior to the payments being made. If Freya wishes to challenge the order granted by this Court, her proper avenue lies in the appeals she has filed before the Court of Appeal. [24] These events collectively have produced a new operational reality that frustrates the purpose of the earlier variation enabling the Company to continue to operate and to deliver vacant possession. The bank’s refusal to issue cheques for the HDA Account means that the Court’s prior mechanism for jointly‑signed cheque withdrawals cannot function, making the earlier order ineffective and exposing the Company to immediate risk. This constitutes a material change for present purposes. [25] Having considered all the evidence and submissions, I find that the presence of new operational facts, the banks refusal to issue cheque books, existence of a winding‑up petition, changed financial circumstances means the court can entertain a variation application, therefore Enclosure 182 is allowed with cost. 09 JANUARY 2026 SHOBA DORAI RAJAH Judicial Commissioner Kuala Lumpur High Court (Commercial Division) Counsel: For the Plaintiff: Choo Shi Jin (Woo J Enn) with him (Messrs Firoz Julian (Kuala Lumpur)) For the 1st Defendants: Ong Chin Siong (Venka Arun) with him (Susan, Siong & Rita (Petaling Jaya))