SUBHADRA DEVI D/O GUNASAGARAN (NRIC NO.: 791209-08-5898) 1. SUNRISE ADVISORY (M) SDN BHD (CO. NO.: 958979-W) 2. NISHANTHEN NAIR A/L GUNASAGARAN (NRIC NO.: 871025-38-5255)

SUBHADRA DEVI D/O GUNASAGARAN (NRIC NO.: 791209-08-5898) 1. SUNRISE ADVISORY (M) SDN BHD (CO. NO.: 958979-W) 2. NISHANTHEN NAIR A/L GUNASAGARAN (NRIC NO.: 871025-38-5255)

The court found the s.348(2) notice requirement satisfied, concluded the applicant was acting in good faith with no established dominant collateral purpose, and that there was a prima facie case in the interests of Sunrise Advisory based on evidence and admissions (loans taken, limited repayment, use of company property). Therefore leave to commence derivative proceedings under s.347 CA 2016 was granted.

Citation
WA-24NCC-110-03/2020 (Mahkamah Tinggi)
Parties
Plaintiff: SUBHADRA DEVI D/O GUNASAGARAN; 1st Defendant (company): SUNRISE ADVISORY (M) SDN BHD; 2nd Defendant (director/shareholder): NISHANTHEN NAIR A/L GUNASAGARAN
Court
High Court
Jurisdiction
Malaysia
Judgment Date
15 April 2021
Case Number
WA-24NCC-110-03/2020 (Mahkamah Tinggi)
Procedural Posture
Derivative Action Under Companies Act 2016 (originating Summons) / Leave Application (grant of Leave Under Section 347)
Outcome
Leave granted to the applicant to commence derivative proceedings on behalf of Sunrise Advisory against the 2nd Defendant; costs awarded to the applicant.
Legal Topics
Derivative Action, Breach of Fiduciary Duty, Misrepresentation, Directors' Loans and Misapplication of Company Assets, Notice Requirement Under Companies Act
Source Language
Malay/English
Company Law Civil Procedure Equity and Trusts Derivative Action Breach of Fiduciary Duty Misrepresentation Directors' Loans and Misapplication of Company Assets Notice Requirement Under Companies Act

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Parties

SUBHADRA DEVI D/O GUNASAGARAN

Plaintiff

SUNRISE ADVISORY (M) SDN BHD

1st Defendant (company)

NISHANTHEN NAIR A/L GUNASAGARAN

2nd Defendant (director/shareholder)

Procedural Posture

Derivative Action Under Companies Act 2016 (originating Summons) / Leave Application (grant of Leave Under Section 347)

Legal Issues

  1. 1 Whether the statutory notice requirement under s.348(2) Companies Act 2016 was complied with
  2. 2 Whether the applicant acted in good faith in commencing the derivative action
  3. 3 Whether there is a prima facie case and whether the proposed action is in the best interests of the company

Ratio Decidendi

The court found the s.348(2) notice requirement satisfied, concluded the applicant was acting in good faith with no established dominant collateral purpose, and that there was a prima facie case in the interests of Sunrise Advisory based on evidence and admissions (loans taken, limited repayment, use of company property). Therefore leave to commence derivative proceedings under s.347 CA 2016 was granted.

Court Disposition

Leave granted to the applicant to commence derivative proceedings on behalf of Sunrise Advisory against the 2nd Defendant; costs awarded to the applicant.

Orders

  • Leave granted in terms of Enclosure 1 to commence proceedings under section 347 Companies Act 2016 on behalf of Sunrise Advisory against the 2nd Defendant
  • Order in terms of Enclosure 1 with costs