1. ) HO SHEN LEE (M) SDN BHD 2. ) Tan Ken Meng 3. ) Khoo Chun Fun LIM SHEN LEE

1. ) HO SHEN LEE (M) SDN BHD 2. ) Tan Ken Meng 3. ) Khoo Chun Fun LIM SHEN LEE

Appeal allowed and High Court winding-up order set aside because petitioner failed to prove the statutory grounds under s465(1)(f) and (h); contested acts were internal management decisions lawful under the M&A, the disputed funds were used as working capital and not dissipated, the petitioner acted in bad faith (conspiracy with third party and misrepresentations to banks) and the company remained solvent with its substratum intact so winding up as a last resort was not justified.

Citation
N-02(NCC)(A)-760-04/2019 (Mahkamah Rayuan)
Parties
Appellant: HO SHEN LEE (M) SDN BHD; Appellant: TAN KEN MENG; Appellant: KHOO CHUN FUN; Respondent/petitioner in High Court: LIM SHEN LEE
Court
NCC
Jurisdiction
Malaysia
Judgment Date
25 October 2021
Case Number
N-02(NCC)(A)-760-04/2019 (Mahkamah Rayuan)
Procedural Posture
Civil Appeal Against High Court Winding Up Order (companies) / Court of Appeal Grounds of Judgment (appeal Allowed)
Outcome
Appeal allowed; High Court winding-up order set aside
Legal Topics
Winding Up, Just and Equitable Jurisdiction, Unfair Prejudice, Directors' Duties, Shareholder Disputes, Majority Rule Vs Minority Protection
Source Language
Malay/English
Company Law Insolvency Law Equity and Trusts Winding Up Just and Equitable Jurisdiction Unfair Prejudice Directors' Duties Shareholder Disputes +1 more

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Parties

HO SHEN LEE (M) SDN BHD

Appellant

TAN KEN MENG

Appellant

KHOO CHUN FUN

Appellant

LIM SHEN LEE

Respondent/petitioner in High Court

Procedural Posture

Civil Appeal Against High Court Winding Up Order (companies) / Court of Appeal Grounds of Judgment (appeal Allowed)

Legal Issues

  1. 1 Whether petitioner established grounds under s465(1)(f) CA 2016 (directors acted for own interest or unfairly)
  2. 2 Whether petitioner established grounds under s465(1)(h) CA 2016 (just and equitable to wind up)
  3. 3 Whether internal management decisions (director appointment, bank signatory changes, vehicle purchases, capital treatment) amounted to unfair or unjust conduct

Ratio Decidendi

Appeal allowed and High Court winding-up order set aside because petitioner failed to prove the statutory grounds under s465(1)(f) and (h); contested acts were internal management decisions lawful under the M&A, the disputed funds were used as working capital and not dissipated, the petitioner acted in bad faith (conspiracy with third party and misrepresentations to banks) and the company remained solvent with its substratum intact so winding up as a last resort was not justified.

Court Disposition

Appeal allowed; High Court winding-up order set aside

Orders

  • Winding-up order of High Court dated 11.4.2019 set aside
  • Costs awarded to the appellants (costs of the appeal)