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1 IN THE HIGH COURT IN MALAYA AT IPOH 5 IN THE STATE OF PERAK DARUL RIDZUAN ORIGINATING SUMMON NO.: AA-24NCvC-354-07/2024 Dalam perkara S41 Akta Spesifik Relief 1950 (Akta 137) 10 Dan Dalam perkara S2 Akta Undang-Undang Sivil (Akta 67) Dan Dalam perkara 471 Akta Syarikat 15 2016 Dan Dalam perkara Aturan 92 Kaedah 4 Kaedah Mahkamah 2012 20 BETWEEN ZENN HRB SDN BHD [Company No.: 2005010280886 (710220-U] …PLAINTIFF 25 AND LIANG KEE DEVELOPMENT SDN BHD [ Company No. : 201501016691 (1142025-W) No. 103, Jalan Veerasamy 30 30300 Ipoh, Perak ...DEFENDANT 09/07/2025 16:59:55 AA-24NCvC-354-07/2024 Kand. 29 GROUNDS OF JUDGMENT Introduction [1]. This case is not merely about statutory compliance or procedural 35 technicalities. It is about what the justice of the case demands and the finality of the litigation process. In this respect, the Court is duty-bound to protect its process from being abused. The Plaintiff’s application is, in truth, an opportunistic attempt to overturn a concluded settlement by consent, which was long settled by mutual 40 compromise. The real question before this Court is whether it should lend its hand in the exercise of its equitable jurisdiction to a party who remained silent when it mattered, paid when it suited, and now pleads illegality when it no longer wishes to honour its compromise. This Court must answer that question firmly, and in doing so, defend 45 the integrity of its process against abuse. Background facts [2]. The Plaintiff seeks to set aside a Judgment in Default (“JID”) entered in 2018, contending that the Defendant had failed to obtain leave under Section 471(1) of the Companies Act 2016, as the Plaintiff 50 was under a winding-up order when the suit was filed. Section 471(1) provides: “S 471(1) - When a winding up order has been made or an interim liquidator has been appointed, no action or proceeding shall be proceeded with or commenced against 55 the company except by leave of the Court and in accordance with such terms as the Court imposes.” [3]. The Plaintiff further seeks restitution of RM560,000.00, alleging the sum was paid pursuant to a void judgment. In reality, the winding-up order had been terminated before judgment was entered, and 60 the payments were made voluntarily and in acknowledgment of the debt; and the winding-up petition was later struck out at the Plaintiff’s own behest. Facts in Chronological order. a) On 28 April 2018, the Plaintiff company was wound up by a 65 creditor (not the Defendant). b) On 31 July 2018, the Defendant filed Suit No. AA-22NCVC- 99-07/2018 against the Plaintiff. No leave was obtained under Section 471(1) of the Companies Act 2016. The Defendant was unaware at the time of filing the suit that the Plaintiff was 70 under a winding-up order. The Defendant’s solicitors had not been informed of the winding-up. c) On 17 August 2018, the winding-up order against the Plaintiff was terminated. d) On 12 September 2018, the Defendant obtained a Judgment 75 in Default (“JID”) against the Plaintiff. This occurred after the winding-up had already been terminated. e) It was only later, during the enforcement stage, that the Defendant became aware of the Plaintiff’s earlier winding-up. The issue of failure to obtain leave under Section 471(1) was 80 only raised by the Plaintiff after full enforcement efforts were in process. There is no evidence that the Defendant had knowledge of the winding-up status at the time of filing the suit or obtaining the JID. This is consistent with the Defendant’s affidavits and submissions, which emphasised that although 85 no leave was sought, the winding-up had ceased before the judgment was entered. f) Between July 2018 (before the JID was obtained) and November 2019, the Plaintiff made cumulative payments totalling RM560,000 to the Defendant in partial satisfaction of 90 the sum owing and/or JID. g) On 14 May 2019, the Defendant filed a winding-up petition (No. AA-28NCC-45/2019) based on the JID. h) In January 2020, the Plaintiff applied to strike out the Defendant’s winding-up petition, this was done not on the 95 basis that the JID was void, but solely on the ground that the amount claimed in the winding-up petition failed to reflect prior payments. i) The petition was struck out on 22 June 2020, with no order as to costs. 100 j) After more than four years, the Plaintiff filed the present Originating Summons seeking declaratory relief to set aside the 2018 JID, citing the Defendant’s failure to obtain leave under Section 471(1) to file the action in which the JID was obtained, as the basis. 105 Analysis of Plaintiff’s Conduct [4]. This Court finds that the Plaintiff’s application is devoid of merit and represents a calculated attempt to manipulate the Court’s equitable jurisdiction. A comprehensive examination of the Plaintiff’s conduct throughout the chronology of events reveals a consistent pattern of 110 conscious acquiescence and affirmation of both the underlying debt and the Judgment in Default. Far from being genuinely aggrieved by procedural irregularity, the Plaintiff’s conduct is typical of a party that knowingly accepted the judgment, reaped the benefits of its enforcement, and even used the partial settlement based on the JID 115 to strike out a winding-up petition. [5]. The Plaintiff is said to have reaped the benefits of its enforcement because the Plaintiff willingly complied with the JID by making payments totalling RM560,000 over time, including through post-dated cheques, and never challenged the validity of the judgment 120 when it mattered. The Plaintiff secured a favourable outcome by successfully striking out the Defendant’s winding-up petition, which was premised on the same JID and the payments made thereto. These conduct of the Plaintiff reflect an acceptance of the JID. However, the present challenge, raised years later on the technical 125 ground that no leave was obtained is nothing more than a belated attempt to reclaim monies already paid under the JID. Such conduct undermines legal finality and offends the principles of fairness and equity. [6]. The Plaintiff’s delay in initiating the present application is obvious. 130 After the winding-up petition had been struck out on their own application and after they had made full payment of the judgment sum, including via post-dated cheques, the Plaintiff remained silent for an extended period of years. Such conduct betrays a deliberate strategy to revive a concluded matter only when it becomes 135 financially expedient to do so. The Court considers this an abusive re-litigation of settled issues, undertaken with full knowledge that the debt in question had never been denied nor disputed at any material time. [7]. Further, about the contents of the letters issued by the Plaintiff’s own 140 solicitors in September and October 2019. These letters unequivocally admit the existence of the JID, confirm the amount due, and offer structured payment proposals. There is nothing stated in these letters that suggest that the Defendant’s civil suit had been improperly commenced without leave under Section 471(1) 145 of the Companies Act 2016. The absence of any reference to statutory illegality during that time strongly indicates that the Plaintiff’s present position is an afterthought rather than a genuine complaint. [8]. In addition, the affidavit filed by the Plaintiff in support of its 150 application to strike out the winding-up petition contained a full schedule of payments made to the satisfaction of the JID. This affidavit constituted a clear and unequivocal affirmation of the judgment obtained by the Defendant. No complaint was raised about the propriety of the JID’s issuance in that proceeding. Indeed, 155 the Plaintiff pursued the striking out on the ground that the amount demanded had not adequately accounted for prior payments, not on the ground that the JID was illegal. [9]. The conduct of the Plaintiff in only now turning to the argument of statutory invalidity under Section 471(1) of the Companies Act 160 2016, long after it had fully participated in and benefited from the resolution of the dispute through compromise, is indicative of bad faith. After all remedies have been exhausted and obligations discharged, the belated invocation of procedural non-compliance is not merely disingenuous; it is the very definition of procedural 165 opportunism. [10]. This is precisely the kind of conduct rebuked by the Court of Appeal in Cheah Theam Kheng v City Centre Sdn Bhd (in liquidation) and other appeals [2012] 1 MLJ 761; [2012] 2 CLJ 16; [2012] 2 MLRA 125; [2012] 1 AMCR 369, where it was held that: 170 “[105] We categorically say that the liquidator cannot blow hot and cold to suit him whenever he feels like it. He cannot approbate and reprobate in the same breath. On the one hand, he claims that the High Court order dated 26 July 2001 overrides or displaces a statute which render the said order 175 invalid and yet he has the audacity to continue to act as a liquidator by virtue of the said order. In the words of Sir Nicolas Browne-Wilkinson VC in Express Newspapers plc v News (UK) Ltd and others [1990] 3 All ER 376, at pp 383– 384: 180 There is a principle of law of general application that it is not possible to approbate and reprobate. That means you are not allowed to blow hot and cold in the attitude that you adopt. A man cannot adopt two inconsistent attitudes towards another: he must elect 185 between them and, having elected to adopt one stance, cannot thereafter be permitted to go back and adopt an inconsistent stance.” [11]. This Court finds that the Plaintiff, having deliberately accepted the 190 judgment sum, made staggered payments pursuant thereto, and secured a favourable outcome in the striking out of the winding-up petition, cannot now approbate and reprobate. To permit such duplicity would not only offend the doctrine of consistency in litigation but also undermine the finality of commercial resolutions. 195 [12]. Furthermore, the Plaintiff’s attempt to reopen a matter long concluded and to frame it as a question of statutory non-compliance despite failing to raise it at any material juncture. In such a case, equity will not assist a party who comes with selective disclosure and seeks to reopen concluded matters by mischaracterising facts 200 in pursuit of tactical relief. This mirrors the criticism in Eastern Properties Sdn Bhd v. Hampstead Corporation Sdn Bhd [2007] 6 CLJ 538; [2008] 1 AMR 285; [2007] 2 MLRA 406, by Gopal Sri Ram JCA, speaking for the Court of Appeal, he explained the applicability of equitable maxims with unrivalled clarity as follows: 205 “[14] It is beyond argument that equitable doctrines are not to be dealt with in a rigid fashion. They are by their very nature flexible and meant to be applied in such a fashion as produces a just result on the facts and circumstances of a given case. But there are certain basic threads that have 210 been woven into the fabric of equitable doctrines through the pronouncements in the leading cases on the subject. One of these is that a supplicant who prays in aid equitable assistance must himself or herself be not guilty of equitable misconduct. This is sometimes put in the form of the maxim: 215 He who comes to equity must come with clean hands. So, a contract breaker cannot successfully invoke the remedy of specific performance. So too, a trespasser may be unable to restrain the true owner of land from denying him access. Likewise, a tenant who is guilty of a breach of a covenant in 220 his lease may be refused equitable relief from forfeiture. These are all but individual illustrations of the basic fabric. [15] Now apply that to the present case. Here we have a litigant which is guilty of a failure to abide by the promise it had made. It would be contrary to all principles of equity to 225 allow it to succeed.” [13]. In Wong Chun Wah v. Kok Kam Chee [2008] 3 CLJ 510; [2008] 3 MLJ 176; [2008] 4 AMR 393; [2008] 1 MLRA 172, the Court of Appeal states the two significant maxims of equity in this regard, two 230 maxims of equity stand out significantly they are: “(1) He who seeks equity must do equity; and