VIJAYAN A/L S. CHINNASAMI 1. ) ADVANCED OPTRONICS DEVICES (ASIA) CO. LIMITED 2. ) LU, BRIAN LONG 3. ) GENTRY LOH GUO XIONG 4. ) MESSRS FRANK CH'NG 5. ) YUNG SIEW PENG 6. ) CHAY YIN HO 7. ) MOHD HAZMIL BIN ABU BAKAR 8. ) ADVANCED OPTRONIC DE

WA-22NCC-146-03/2020 Kand. 190 07/09/2022 11:30:30 IN THE HIGH COURT OF MALAYA AT KUALA LUMPUR IN THE FEDERAL TERRITORY OF MALAYSIA (COMMERCIAL DIVISION) CIVIL SUIT NO.: WA-22NCC-146-03/2020 BETWEEN VIJAYAN A/L S. CHINNASAMI (NRIC NO.: 651121-10-5685) … PLAINTIF AND 1. ADVANCED OPTRONICS DEVICES (ASIA) CO. LIMITED (Company No.: 580305494-000-05/17-4) 2. LU, BRIAN LONG (Passport No.: 305253007) 3. GENTRY LOH GUO XIONG (NRIC NO.: 851205-01-6045) 4. MESSRS FRANK CH’NG (Formerly known as Frank Ch’ng Gentry) (Sued as a Firm pursuant to Order 77 of the Rules of Court 2012) 5. YUNG SIEW PENG (NRIC NO.: 561109-10-6627) 6. CHAY YIN HO (NRIC NO.: 741203-14-5356) S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 1 document via eFILING portal 7. MOHD HAZMIL BIN ABU BAKAR (NRIC NO.: 861220-38-6377) 8. ADVANCED OPTRONIC DEVICES (MALAYSIA) SDN BHD (formerly known as Collective Energy Sdn Bhd) (Company No.: 1078417-M) … DEFENDANTS GROUNDS OF JUDGMENT Background Facts [1] The Plaintiff (‘Vijayan’) incorporated a company by the name of Collective Energy Sdn Bhd (‘CESB’) on 22.1.2014 with a paid-up capital of RM100,000.00. Vijayan was the first director and shareholder of CESB. [2] Subsequently, on 11.9.2014, one by the name of Sujatha A/P Ramakrishnan (‘Sujatha’) was appointed as a director of CESB. Thereafter, Vijayan increased the issued and paid-up capital of CESB to RM250,000.00 at the request of some of the suppliers. [3] CESB was involved in the business of buying and selling light-emitting diode (LED) lights and accessories (‘LED Lights and Accessories’). Upon incorporation of CESB, Vijayan approached the 1st Defendant (‘AODA’) and the 2nd Defendant (’Brian Lu’) for the supply of LED Lights and Accessories to CESB, which led to the beginning of a S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 2 document via eFILING portal business relationship between AODA and CESB wherein CESB agreed to purchase and AODA agreed to supply LED Lights and Accessories to CESB. [4] AODA is a private company limited by shares incorporated under the laws of Hong Kong having the registered address at Unit 11, 7F, Goodluck Industrial Centre, 808 Lai Chi Kok, Cheung Sha Wan, Hong Kong, supplying LED Lights and Accessories. AODA became the main supplier of LED Lights and Accessories to CESB. [5] Consequently, Vijayan changed the name of CESB to Advanced Optronic Devices (Malaysia) Sdn Bhd (‘AODM’) i.e the 8th Defendant, with effect from the 9.2.2015. In essence, the shareholding of AODM after the increase of the issued and paid-up capital were as follows – Shareholders Number of shares Vijayan 249,999 Sujatha A/P Ramakrishnan (‘Sujatha’) 1 On 8.11.2016, Sujatha resigned as the director of AODM. [6] On and around the year of 2017, Vijayan proposed to Brian Lu to sell his entire shareholding in AODM to AODA. According to Vijayan, he had an offer and or opportunity to work in Singapore and that it would be difficult for him to manage the business of AODM if he is away in Singapore. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 3 document via eFILING portal [7] Brian Lu informed Vijayan that he would require the approval of the Board of Directors of AODA for the acquisition and purchase of the shares in AODM. Upon discussion with the members and the Board of Directors of AODA, Brian Lu requested for the audited financial statements for the years ended 2016 and 2017 from Vijayan for the Board of Director’s assessment pertaining to the viability of this acquisition and or purchase of the entire shareholding in AODM. [8] The Board of Directors of AODA subsequently agreed in principle, amongst others, to purchase the entire 250,000 ordinary shares in AODM for a consideration purchase sum of USD100,000.00 and fifteen (15%) shares in AODA to Vijayan. [9] Pursuant to the aforesaid, Vijayan and AODA enter into a Memorandum of Understanding on 28.9.2017 (‘MOU’) incorporating the terms and conditions as negotiated between parties prior to entering into a formal agreement. The salient terms of the MOU are, inter alia: CLAUSE 1 INTENTION OF PARTIES It is the intention of the parties that – (i) a formal agreement to be entered between the 1st Defendant and the Plaintiff within sixty (60) days from the date hereof upon which Formal Agreement shall incorporate the terms and conditions hereinafter set out and such other terms and conditions as may be agreed upon between the parties. (ii) The Plaintiff shall secure or assist the 8th Defendant – (a) to secure a project in Penang (‘Penang Port Project’) S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 4 document via eFILING portal (b) to procure all necessary approvals, permits, licenses and authorities in connect with the Penang Port project from all the authorities in Malaysia and shall ensure the approvals remain in place and valid notwithstanding the completion of the proposal (c) to secure the issuance of the letter of award in respect of the Penang Port Project in favour of the 8th Defendant without any adverse conditions imposed on 8th Defendant on conditions acceptable to 1st Defendant (iii) subject and upon the fulfilment of the conditions, the consideration payable to the Plaintiff shall be the sum equivalent to USD 100,000.00 and fifteen (15%) shares in the 1 st Defendant. The method of payment of the payment and the transfer thereof shall be as follows, unless otherwise agreed to by the parties –: (a) subject to and upon the fulfilment of the Conditions, the 1st Defendant shall pay a sum equivalent to USD50,000.00 to the Plaintiff and shall transfer or issue or allot 15% shares of the 1 st Defendant in favour of the Plaintiff; (b) simultaneous with (a) above, the Plaintiff shall execute the relevant shares transfer form to transfer the shares to 1st Defendant; and (c) the 1st Defendant shall pay the remaining purchase consideration sum of USD50,000.00 (‘Remaining Sum’) to Plaintiff within six (6) months from the completion date. (iv) that the Plaintiff shall fully indemnify and shall keep the 1 st Defendant indemnified and harmless against all demands, costs, claims, proceedings, fines, penalties, losses, damages, litigation whatsoever involving 8th Defendant, AODM prior to and including the Completion Date. AODA shall be entitled to withhold the remaining sum should the Plaintiff refused and/or failed to indemnify AODA (emphasis added) (collectively referred to as the ‘Terms and Conditions’) S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 5 document via eFILING portal CLAUSE 4 SUBJECT TO CONTRACT The agreement between parties is subject to and conditional upon the Formal Agreement being entered into and subject to Clause 2, 3 and 4 hereof, is not intended to be binding upon the parties until and unless the formal agreement is entered into. [10] It is not disputed that sometime on 1.10.2017, Vijayan left Malaysia to work in Singapore and had placed Brian Lu and one Chay Yin Ho (‘CYH’) to take over the affairs of AODM. Further, on 3.10.2017, AODA executed a Corporate Guarantee in favour of NEC Corporation to guarantee the payment by AODM to NEC Corporation of all sums due and owing pursuant to AODM’s Purchase Order dated 27.3.2017 and NEC Corporation of Malaysia Sdn Bhd’s (‘NEC Corporation’) invoices Nos 91300668804, 91300668805 and 91300668806 each dated 26.9.2017. [11] In and around 31.10.2017, the 3rd Defendant (‘Gentry Loh’), an advocate and solicitor appointed by Brian Lu, informed Vijayan and Brian Lu that the first draft of the Share Sale Agreement for the AODM shares (‘the SSA’) would be circulated by the week for their perusal and comment(s) if any. The SSA was subsequently emailed to Vijayan and Brian Lu on 6.11.2017. For completeness, the MOU was also drafted by Gentry Loh. [12] It is not disputed that whilst the parties were perusing the SSA, preparations and arrangements were made with AODM’s then company secretary, one Miss Oi Ling (‘Oi Ling’) for all the relevant documents necessary to effect the transfers of the AODM shares S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 6 document via eFILING portal including the relevant board resolutions approving the transfers of the shares, appointment of additional directors, resignation of secretaries, appointment of new secretaries and procuring the necessary letters of resignation of existing directors and the share transfer forms. In fact, the parties had scheduled the execution of the SSA on 14.11.2017. [13] In the meanwhile, subsequent to the execution of the MOU, AODA had proceeded to conduct a ‘due diligence’ exercise and inquiry on AODM’s financial position. According to Brian Lu’s testimony, AODA discovered that there were claims and legal proceedings being commenced and filed against AODM, listed amongst others were as follows -: No. Creditor/ Outstanding Documentary/ Evidence Plaintiff Amount Due & Tendered Owing (RM) 1. H&H RM11,978.00 Letter of Demand issued by Production Messrs. Leong & Co dated Sdn Bhd 18.09.2017 2. TNT Express RM22,472.96 Letter of Demand issued by Worldwide Messrs. G.Y Ang & Associates (M) Sdn Bhd dated 25.09.2017 3. Ying Global RM36,041.82 Letter of Demand issued by Sdn Bhd Messrs. S. Matthews & Associates dated 29.09.2017 4. Miyabi Sign RM17,914.00 Letter of Demand issued by Advertising Messrs. Jimmy M.O Ng & Sdn Bhd Associates dated 16.10.2017 S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 7 document via eFILING portal 5. Amsay Letrik RM35,465.50 Letter of Demand issued by Sdn Bhd Messrs. Narendran & Associates dated 10.11.2017 6. NEC RM3,278,760.00 Letter of Demand issued by Corporation Messrs. Thomas Wong & Co Malaysia dated 03.01.2018 Sdn Bhd 7. Amsay Letrik RM17,725.50 Writ of Summons & Statement of Sdn Bhd Claim dated 4.12.2018 Total Outstanding RM3,339,449.97 Debt Incurred by AODM (RM) [14] According to Brian Lu’s testimony, the members and the Board of Directors of AODA was ‘shocked’ to discover the ‘insurmountable debt’ of approximately RM3,339,449.97 and was wary that AODA would incur severe losses in the event AODA were to proceed with the purchase of the 250,000 ordinary shares and take over AODM. The members and the Board of Directors of AODA had believed that Vijayan had acted in ‘mala fide’ when he failed to disclose the debts and liabilities of AODM and had made fraudulent or false representation with the intention to deceive AODA and or Brain Lu into entering the MOU. [15] However, there is no documentary evidence that AODA’s aforesaid concerns, if at all, were ever conveyed to Vijayan. In fact, in or around 11.10.2017, Vijayan forwarded an electronic mail to Brian Lu to inform him about the progress of the Penang Port Project stating that the S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 8 document via eFILING portal Letter of Award (‘LA’) for the same would probably be delayed to early or mid-November 2017. It is pertinent to note that the LA was never issued in November 2017. However, no such documentary evidence was tendered during trial. [16] On 26.10.2017, AODM issued a notice to its clients to state thus: ‘Please be informed that effective from 1st October 2017, Advanced Optronic Devices (M) Sdn Bhd is taken over by Advanced Optronic Devices (Asia) Co. Ltd (Hong Kong)’. Clients were also informed of the change to the company’s bank account to ‘Bank of China (Hong Kong) Limited’. [17] Notwithstanding the aforesaid, the SSA was not executed either on 14.11.2017 as planned or thereafter. On 13.11.2017, Gentry Loh had chased Vijayan for his comments on the SSA to enable him to ‘finalise and fair the agreement’ for the signing the next day at his office. On 27.11.2017, Gentry Loh wrote again to Vijayan seeking the return of certain documents regarding the transfer of shares. [18] However, around the end of November 2017, a copy of the SSA purportedly signed by Vijayan and Sujatha was delivered to the premises of the 4th Defendant (‘Messrs Frank Ch’ng’), being the firm in which Gentry Loh was a partner at the material times. Both Vijayan’s and Sujatha’s signatures were not attested before any witnesses. [19] According to Gentry Loh, he contacted Brian Lu on the SSA and was instructed to keep the ‘draft’ in abeyance since the same has yet to be S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of this 9 document via eFILING portal finalized. There is no evidence that Gentry Loh had communicated the AODA’s decision to keep the SSA in abeyance to Vijayan. [20] Sometime on 22.12.2017, one Azhar Shah Zainal, who was the Senior Finance of AODM sent an email to Brian Lu and Vijayan giving a breakdown of various sums needed to be paid by AODM to its creditors, including a sum of RM 983,628.00 due to NEC Corporation. A figure of USD 270,000.00 was stated as the amount to be transferred to AODM’s USD account. This document suggests that AODM was in urgent need of funds. [21] As will be significant later, between November 2017 to late February 2018, no steps were taken to effect the transfer of the AODM shares or to change the composition of AODM’s board of directors notwithstanding that all the necessary documents for the same had already been prepared and forwarded by Oi Ling. [22] However, sometime on 20.3.2018, Gentry Loh wrote to Oi Ling to prepare the relevant documents for Vijayan to resign as a director and his email further stated thus: ‘Please note that subsequent to the execution and submission of the documents, AODA will be the sole shareholder of AODM while Brian Lu and Sam Yung will be the only 2 directors of AODA’. The relevant board resolution and letter of resignation of Vijayan were forwarded to Gentry Loh on 22.3.2018 from Oi Ling. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 10 this document via eFILING portal [23] Following from the aforesaid, it would appear that preparations were made to appoint Gentry Loh as a director of AODM. With his appointment, AODM’s directors would comprise of the 5th Defendant i.e Sam Yung Siew Peng (‘YSP’) and Gentry Loh. [24] At the time when the aforesaid was taking place, around 20.3.2018, NEC Corporation had commenced legal proceedings against AODM and Vijayan in his capacity as a guarantor for the sum of RM 2,295,132.00. [25] According to Brian Lu, Vijayan had requested AODA to bail him out by settling the debt owed by AODM to NEC Corporation and in consideration of the full settlement of RM 2,295,132.00 (‘the NEC Settlement’), Vijayan would execute and transfer his 249,999 ordinary shares to AODA. [26] Brian Lu testified that the members and the Board of Directors of AODA were very reluctant to bail Vijayan out of the debt owing to NEC Corporation but was placated by Vijayan’s verbal promise that he would resign as a director of AODM and would execute the transfer of his 249,999 ordinary shares to AODA upon the NEC Settlement. It was based on this promise that the Board of Directors of AODA and the members approved to settle the debt owed to NEC Corporation on behalf of AODM and Vijayan. [27] It is not disputed that AODA did make the payment of the sum of RM 2,295,132.00 to NEC Corporation to settle AODM’s debts. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 11 this document via eFILING portal [28] Again, according to Brian Lu, with the NEC Settlement, AODA would have completed the acquisition of AODM shares. Settlement negotiations were entered between NEC Corporation, AODA and Vijayan (representing AODM and himself) culminating in a Settlement Agreement dated 30.3.2018 and a consent judgment was recorded in favour of NEC Corporation in the Kuala Lumpur High Court, Suit No.: WA-22NCC-107-03/2018 on the 26.4.2018. [29] The documents before this Court show that Vijayan tendered his letter of resignation dated 23.4.2018 and the form of transfer of securities executed by Vijayan was dated 04.05.2018. There was no fresh form of transfer for Sujatha’s 1 share in AODM. [30] In or around 15.04.2019, CYH informed Brian Lu that Sujatha had confirmed via an email correspondence dated 15.04.2019 that the SSA and the shares transfer form dated 4.5.2018 that were purportedly executed by her was forged. Sujatha informed CYH that she had no knowledge nor was she aware that she had executed the SSA nor the shares transfer form as she was away in Australia. [31] According to Brian Lu, Vijayan was desperate to sell the 250,000 ordinary shares in AODM and or business in AODM to AODA due to the insurmountable debt of the company, which would have exposed Vijayan to be made a bankrupt. This had prompted Vijayan to execute the SSA and ‘forged’ Sujatha’s signature. Vijayan and or the company secretary thereafter caused the forms of transfer of 250,000 ordinary shares to be delivered to AODA in order to coerce AODA and/or Brian S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 12 this document via eFILING portal Lu to pay Vijayan the USD 100,000.00 and from aborting the execution of the SSA. [32] Upon the knowledge that Sujatha never executed any share transfer form, AODM offered her a sum of RM 10,000.00 as a token of appreciation in return for her share and she signed the letter to approve the transfer of her one (1) share to Gentry Loh. [33] Thus, it is AODA’s case that Vijayan’s shares were never transferred pursuant to the SSA which were never executed and agreed to by AODA. Instead, the consideration for the transfer of the AODM shares was the payment of the NEC Settlement by AODA. As such, there is no legal basis for Vijayan’s claim for the payment of USD 100,000.00 and the 15% shares in AODA as provided for in the draft SSA. However, this was not expressly pleaded in AODA’s Defence. [34] On the other hand, it is Vijayan’s case that there was in existence a valid and enforceable agreement based on the terms of the MOU and SSA that was made partly oral, partly in writing and partly by conduct and or as a result of a course of dealing between Vijayan and AODA and or Brian Lu. [35] More specifically, Vijayan claimed that the agreement is contained in or is to be inferred from the following documents or some or one of them, which were prepared by Gentry Loh: - (a) the duly executed MOU; and S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 13 this document via eFILING portal (b) the SSA, which according to Vijayan, has been accepted by performance. [36] In addition to the SSA, Vijayan claimed that there were two further side agreements and they were as follows: - (a) that Vijayan was permitted to store and or keep his kitchen equipment belonging to another business in the premises of AODM for a period of one (1) year from the sale of his shares in AODM to AODA; and (b) that Vijayan was to advance the payment of Government Sales Tax (GST) of RM 53,000.00 imposed by the Director General of Inland Revenue Department against AODM for transactions involving final quarter of the year 2017. (‘the Oral Side Agreements’) [37] In the Statement of Claim, Vijayan claimed that in breach of the SSA and the Oral Side Agreements: (a) he was not paid the sum of USD100,000.00 pursuant to the terms and conditions of the MOU and the SSA including the transfer and or issuance and or allotment of fifteen (15%) percent of AODA shares as agreed; S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 14 this document via eFILING portal (b) on or around 20.9.2018, CYH through AODM’s Notice of Eviction, had wrongfully removed his kitchen equipment after the expiry of the notice period; and (c) notwithstanding that on or around 23.4.2018, Vijayan had paid the sum of RM 53,000.00 to the Director General of Inland Revenue for and on behalf of AODM, AODA and or Brian Lu and or AODM have refused and failed to reimbursed him the sum of RM 53,000.00. [38] According to Vijayan, in or around December 2018, he conducted a search at the Companies Commission of Malaysia (‘CCM’) and discovered that Gentry Loh and YSP had been appointed as the directors and shareholders of AODM on 23.4.2018 and 20.5.2018 respectively contrary to the terms and conditions of the SSA. Based on the searches carried out, the shareholding of AODM as at 23.7.2019 were as follows: - SHAREHOLDERS OF AODM TOTAL OF SHARES Gentry Loh 1 YSP 249,999 [39] Consequently, on 8.4.2019, Vijayan commenced a Pre-Action Discovery vide Kuala Lumpur High Court Originating Summons No.: WA-24NCC-172-04/2019 pursuant to Order 24 Rule 7A of the Rules of Court 2012 against Gentry Loh and Messrs Frank Ch’ng including the Company Secretary of AODM to compel them to produce the stamped S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 15 this document via eFILING portal and or duly executed copy of the SSA, the MOU and the Transfer Instruments (the ‘Pre-Action Discovery Suit 172’). [40] Vijayan claimed that in opposing the Pre-Action Discovery Suit 172, Messrs Frank Ch’ng and the Company Secretary of AODM had filed their respective affidavits where they confirmed that Gentry Loh was retained and appointed by Vijayan to act for him in relation to the MOU and the SSA. However, Gentry Loh maintained that he was appointed to act for AODA at all times and had never acted for Vijayan. [41] On 23.7.2019, this Court allowed Vijayan’s Pre-Action Discovery Suit 172 against Gentry Loh and the Company Secretary of AODA (‘Discovery Order’). Gentry Loh had not filed an appeal against the Discovery Order. [42] According to Vijayan, it was only from Gentry Loh’s Affidavit Verifying List of Documents dated 29.7.2019 on 31.7.2019 that he discovered for the first time that: (a) the SSA had not been executed by AODA; (b) the duly executed MOU had not been stamped; (c) the original copies of the SSA and the MOU have been in the custody of Gentry Loh and or Messrs Frank Ch’ng; (d) the Transfer Instruments have been put into effect without his consent and knowledge; and (e) Brian Lu had been appointed as a director of AODM on 25.2.2019. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 16 this document via eFILING portal [43] Consequently, on 16.3.2020, Vijayan commenced the present Suit against the Defendants herein based on the following causes of action: (a) breaches of the SSA; (b) breaches of the Oral Side Agreement; (c) fraudulent misrepresentation and/or deceit; (d) breach of duty of care both in contract and tort and for breach of fiduciary obligations and/or breach of trust; (e) wrongful conversion of his 249,999 ordinary shares of RM1.00 each; (f) breach of constructive trust; and (g) knowing receipt and knowing assistance. Court’s Deliberation Whether there is a valid and enforceable agreement between Vijayan and AODA where Vijayan agreed to sell the entire 250,000 shares in AODM to AODA for USD100,000.00 and 15% of the shares of AODA [44] Vijayan contended that there is valid and binding agreement for the sale and purchase of the AODM shares and relied on the following: (1) that Vijayan and AODA had been in business relationship since the incorporation of CESB where CESB would purchase and AODA would supply LED Lights and Accessories to CESB with an aim of appointing CESB as the sole distributor of AODA’s LED Lights and Accessories in Malaysia. In fact, at the material times, AODA was the main supplier of LED Lights and Accessories to S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 17 this document via eFILING portal CESB. Following from the aforesaid, Vijaya changed the name of CESB to AODM with the consent of AODA with effect from 9.2.2015; (2) that as the business of AODM grew, Brian Lu informed Vijayan that AODA was interested to acquire the shareholding of AODM with a view of listing AODA on the Hong Kong Exchange and Clearing Limited; (3) that in view of AODM’s interest to acquire the shareholding of AODM, in or around 2017, Vijayan proposed to Brian Lu the idea of selling his entire stake in AODM to AODA as Vijayan had an offer and or opportunity to work in Singapore on a full-time basis; (4) that following a series of conversation between Brian Lu and Vijayan for a period of time, Brian Lu requested for the audited financial statements of AODM for the past years from Vijayan in order for AODA to assess the viability of AODM. Pursuant thereto, in or around 9.9.2017, Vijayan forwarded the following documents to Brian Lu for his consideration: (a) a copy of the Audited Financial Statement of AODM for the year ended 2014; (b) a copy of the Audited Financial Statement of AODM for the year ended 2015; (c) a copy of the Account Receivable Ageing Summary of AODM as of 31 August 2017; and S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 18 this document via eFILING portal (d) a copy of the Transaction Report of AODM with regard to director’s loan as at 31 August 2017. (5) that upon receipt of the abovementioned documents, on 10.9.2017, Brian Lu forwarded an electronic mail to inform Vijayan that AODA’s “board meeting” would be convened on 11.9.2017 and accordingly requested for the Audited Financial Statement of AODM for the years ended 2016 and 2017 as soon as possible. Immediately upon receipt of the said electronic mail, Vijayan requested for the relevant financial statements of AODM from CYH. On the same day, CYH forwarded a copy of the Profit and Loss of AODM and a copy of the Sales by Customers Summary for the period between January to December 2016 at about 11.06 pm. The following morning i.e on 11.9.2017, Vijayan forwarded the abovementioned documents to the Brian Lu. Further, on 11.9.2017, Vijayan also wrote to inform Brian Lu that he required time to complete the financial statement for the year ended 2017 and the Profit and Loss. However, via the same mail, Vijayan forwarded a copy of the Sales by Customers Summary for a period between January 2017 to August 2017; (6) that after the board meeting of AODA on 11.9.2017, Brian Lu informed Vijayan that AODA had agreed in principle, among others, to purchase the entire 250,000 ordinary shares in AODM for a consideration sum of USD100,000.00. In addition to the consideration sum of USD100,000.00, AODA and or Brian Lu also agreed to transfer fifteen (15%) percent of the ordinary S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 19 this document via eFILING portal shares of AODA to Vijayan as consideration of the sale of the 250,000 ordinary shares in AODM subject to Vijayan securing a project valued at approximately RM3,600,000.00 in total in Penang for the benefit of AODM (the ‘Penang Port Project’); (7) that following a series of communication between Vijayan and Brian Lu, on 28.9.2017, Vijayan and AODA executed the MOU, which was prepared by Gentry Loh; (8) that upon the execution of the MOU, there were several electronic communications between Vijayan, Brian Lu, Gentry Loh and the former company secretary of AODM, Oi Ling, with regard to the composition of the shareholders of AODM; (9) that after having sorted the composition of shareholders of AODM, Gentry Loh forwarded an electronic mail to Vijayan and Brian Lu on 31.10.2017 to state as follows: - (a) that “AODA is the midst of entering into a Share Sale Agreement with Vijay and Sujatha to take over AODM” and accordingly instructed Oi Ling to “prepare the shares transfer forms and courier them to” his office “for the execution of all parties.”; (b) that the “first draft of the Share Sale Agreement will be circulated by this week for your perusal and comments(s) if any.”; (c) that they “are looking to finalise the SSA by next week.”; S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 20 this document via eFILING portal Further, in the same mail, Gentry Loh had proposed the date of signing as follows: “I would like to propose 14 November 2017, 4pm in my office at Plaza Mont Kiara, to be the signing date of the SSA and the relevant documents.” and sought Vijayan and Brian Lu’s confirmation as to their availability on 14 November 2017. (10) that importantly on 3.11.2017, Vijayan received an electronic mail from a representative of a company, Syspex Technologies (M) Sdn Bhd by the name of Mr Amron Lee, a customer of AODM at the material time. In the said mail, Mr. Amrom Lee attached a letter from AODM dated 26.10.2017 to Syspex Mechatronic (M) Sdn Bhd, Syspex Technologies (M) Sdn Bhd, and Syspex Industries (M) Sdn Bhd, which was duly signed by one Azhar Shah Ahmad Zainal as the Senior Finance of AODM. In essence, pursuant to the said letter dated 26.10.2017, AODM wrote to notify the abovementioned customers that “effective from 1st October 2017, Advanced Optronic Devices (M) Sdn Bhd” had been “taken over by Advanced Optronic Devices (Asia) Co. Ltd (Hong Kong).” Further, pursuant to the said letter dated 26.10.2017, AODM also wrote to notify the abovementioned customers that there was a change in banking details and provided the new banking details to the said customers. For ease of reference, the contents of AODM’s letter dated 26.10.2017 are reproduced herein below: ‘Syspex Mechatronic (M) Sdn Bhd S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 21 this document via eFILING portal Syspex Technologies (M) Sdn Bhd, and Syspex Industries (M) Sdn Bhd To Whom It May Concern NOTIFICATION CHANGE OF BANK DETAILS Thank you for supporting us over the years. Please be informed that effective from 1st October 2017, Advanced Optronic Devices (M) Sdn Bhd is taken over by Advanced Optronic Devices (Asia) Co. Ltd (Hong Kong) . Therefore there is change on our bank account. Details of our bank account stated below. Bank name: Bank of China (Hong Kong) Limited Swift Code: BKCHHKHH Bank acc no.: 012 918 1064 9947 (Hong Kong Dollar) Bank Address: To Kwa Wan Branch 80N To Kwa Wan Road’ Learned counsel for Vijayan highlighted that the letter of 26.10.2017 was also signed by Gentry Loh. It is further highlighted that Brian Lu had confirmed in cross-examination that effective from 1.10.2017, AODA had already taken over AODM and that the above letter was issued by AODM even before the circulation of the 1st draft SSA on 6.11.2017. Hence, it is submitted that that above documentary evidence and conduct of AODA clearly demonstrates that AODA had already taken over the management of AODM after the execution of MOU. It is contended that the execution of the SSA had been rendered a mere formality by reason of S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 22 this document via eFILING portal AODA’s conduct in taking over and changing the bank account of AODM with effect from 1.10.2017. (11) that subsequently, Gentry Loh forwarded the SSA to Vijayan and Brian Lu for their “perusal and comments(s), if any” and requested the Oi Ling, the former Company Secretary, to ‘prepare for the purpose of this matter as below: such persons as the Purchasers (AODA) may nominate shall be appointed as directors of the Company all with effect from the Completion Date; (ii) such person as the Purchaser (AODA) may appoint shall be appointed company secretary/secretaries of the Company with effect from the Completion Date; (iii) there shall be submitted and accepted the resignation of the directors and company secretary all with effect from the Completion Date; and (iv) the transfer of the said Shares shall be approved for registration.” (12) that on 9.11.2017, as requested, Oi Ling forwarded the following to Brian Lu for his attention and comments: - (a) the Board of Directors’ resolution pertaining to SSA; (b) the Board of Directors’ resolution for appointment of additional director; (c) the Letters of resignation of Vijayan and one Hashbudin Bin Hashim as directors of AOD(M)SB; S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 23 this document via eFILING portal (d) the Board of Directors’ resolution for resignation of secretaries; (e) the Board of Directors’ resolution for appointment of additional secretary; (f) the Board of Directors’ resolution to approve transfer of shares; and (g) the Forms of Transfer of Securities pursuant to Section 105 of the Companies Act 2016. (13) that following a series of communication, Vijayan collected and returned personally the executed copy of the SSA to Gentry Loh’s office at Plaza Mont Kiara, Kuala Lumpur between 14.11.2017 to 30.11.2017. [45] It is common ground that Vijayan was not given a copy of the duly executed MOU and the SSA until after the Discovery Order. [46] It is Vijayan’s case that he had executed several blank Transfer Instruments on the advice and or persuasion of Brian Lu and or Gentry Loh and on an assurance that they will not put the Transfer Instruments into effect until the part payment of the consideration for the sale and purchase of his shares in AODM under Clauses 1(iii) of the MOU and Section 3.02(1)(a) of the SSA are made. However, no documentary evidence has been adduced in support of such ‘advice’ or ‘persuasion’ or ‘assurance’. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 24 this document via eFILING portal [47] Notwithstanding the aforesaid, based on the blank Transfer Instruments, Vijayan claimed that his 249,999 shares in AODM were subsequently transferred to Brian Lu and YSP without his knowledge and consent. However, during the cross-examination by Brian Lu’s counsel, Vijayan testified that the blank Transfer Forms were passed to him by either Brian Lu and or CYH for his signature on several occasions and the same were returned to Gentry Loh through Brian Lu and or CYH. Vijayan said that he cannot confirm if they had returned the same to Gentry Loh. Further, he testified in cross-examination that some of Transfer Instruments given to him for his signature were blank and some had some details. [48] According to Vijayan, pursuant to the terms and condition of the MOU and or the SSA, he had secured the Penang Port Project. In this regard, he had forwarded an electronic mail to Brian Lu and Gentry Loh on 23.5.2018 to inform them that he “have delivered the requirements in item 1(ii) as per the MOU” and sought their advice on “the timing of the payment and the 15% share transfer.”. [49] At no time did AODA, Brian Lu and or Gentry Loh ever communicate to Vijayan to state that the MOU and or the SSA had been aborted, cancelled or that the SSA had been put in abeyance. [50] Based on the aforesaid, it is contended that AODA and or Brian Lu with full knowledge of the terms and conditions set out in the MOU and the SSA (which Vijayan had duly signed), including the Transfer Instruments, had by retaining the same without in any way dissenting S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 25 this document via eFILING portal from or objecting to any of the terms and conditions between the period of November 2017 to March 2018 thereby agreed to and accepted the terms and conditions of the MOU and or SSA or had signified their acceptance of the same. By their silence and conduct, it is contended that AODA and Brian Lu had permitted and induced Vijayan to believe that they had agreed to and accepted the terms and conditions of the MOU and or the SSA that was signed by the Plaintiff. [51] On the other hand, AODA and Brian Lu take the position that: - (1) in or around the year 2017, Vijayan approached Brian Lu to propose the idea of selling his entire 249,999 ordinary shares in AODM to AODA; (2) Vijayan had informed Brian Lu that he was looking for a buyer to buy the entire shareholdings in AODM and that it would be difficult for Vijayan to manage the business of AODM while being away in Singapore; (3) upon discussion with the members and Board of Directors of AODA regarding the acquisition and the purchase of Vijayan’s shares in AODM and following a series of conversation with Vijayan, AODA requested for the audited financial statement of AODM for the year ended 2016 and 2017 from Vijayan for the Board of Directors’ assessment regarding the viability of this acquisition and or purchasing of his entire shareholdings in AODM; S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 26 this document via eFILING portal (4) upon perusing the audited financial statements, the Profit and Loss, the ageing summary reports and the relevant financial documents provided by Vijayan, the members and Board of Directors of AODA were placated with one caveat, that a proper ‘due diligence’ exercise and inquiry would have to be carried out by their team of auditors before the acquisition and or the purchase of the entire shareholdings and or the execution of the SSA; (5) the Board of Directors of AODA had agreed in principle, among others, to purchase the 250,000 ordinary shares in AODM for a purchase consideration sum of USD100,000.00 and fifteen (15%) percent shares in AODA to Vijayan as consideration. In order to reflect the intention of the parties, both Vijayan and AODA entered into the MOU incorporating the terms and conditions as negotiated between parties prior to entering into a formal agreement; (6) the MOU was ‘subject to contract’ or conditional upon a formal agreement being entered into and subject to Clauses 2, 3 and 4 of the MOU. It was not intended to be binding upon the parties until and unless the formal agreement is entered; (7) notwithstanding the above, Brian Lu contended in his evidence in chief that Vijayan had failed to secure the Penang Port Project in accordance with the required time or to procure all necessary S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 27 this document via eFILING portal approvals, permits, licences and authorities in relation to the Penang Port Project; (8) AODA had carried out a due diligence exercise and inquiry on the financial position of AODM and discovered there were claims and legal proceedings against AODM; (9) the SSA though signed by Vijayan was never executed by AODA and it was subsequently discovered that Vijayan had forged Sujatha’s signature in the SSA; (10) notwithstanding the above, Brian Lu testified in his evidence chief that at Vijayan’s request, AODA agreed to bail him out by settling the debt owed to NEC Corporation and in consideration thereof, Vijayan had agreed to the transfer of his 249,999 ordinary shares to AODA. According to Brian Lu, AODA was prepared to settle the NEC Corporation’s debts because AODA had the AODM shares as ‘security’ which AODA subsequently transferred to its nominees. Court’s deliberation [52] In support of the contention that the MOU constituted a valid and binding agreement, learned counsel for AODA relied on the following authorities. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 28 this document via eFILING portal [53] In the case of Federal Court of Charles Grenier Sdn Bhd v Lau Wing Hong [1996] 3 MLJ 327; page 334 [para. G] to page 335 [para. B] the Federal Court observed that “subject to contract” does not necessarily mean there was no contract. The Federal Court said that the court must construe the intention of the parties and decide whether the contract had been concluded. In essence, the Federal Court said that it was a matter of construction of the intention of the parties, namely: (a) If the intention of the parties was to draw up a formal contract to be agreed by both parties, then there is no enforceable contract; or (b) If the intention of the parties was merely to draw up a formal contract after the terms had already been agreed, then there was is a binding contract. [54] More specifically, his Lordship Gopal Sri Ram (as his Lordship then was) said the following with regard to the term ‘subject to contract’: - ‘Although the judgment of Edgar Joseph Jr SCJ in Ayer Hitam contains all the learning upon the subject, we would, for completeness, refer to the following passage in the joint judgment of Dixon CJ, McTirman and Kitto JJ, in Masters v Camoron (1954 91 CLR 353: Where parties who have been negotiation reach agreement upon terms of a contractual nature and also agree that the matter of their negotiation shall be dealt with by a formal contract, the case may belong to any of three classes. It may be S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 29 this document via eFILING portal one in which the parties have reached finality in arranging all the terms of their bargain and intend to be immediately bound to the performance of those terms, but at the same time propose to have the terms restated in a form which will fuller or more precise but not different in effect. Or, secondly, it may be a case in which the parties have completely agreed upon all the terms of their bargain and intend no departure from or addition to that which their agreed terms express or imply, but nevertheless have made performance of one or more of the terms conditionals upon execution of a formal document. Or, thirdly, the case may be one in which the intentions of the parties is not to make a concluded bargain at all, unless and until they execute a formal contract. In each case of the first two cases, there is a binding contract: in the first case a contract binding the parties at once to perform the agreed terms whether the contemplated formal document comes into existence or not, and to join (if they have so agreed) in settling and executing the formal document; and in the second case a contract binding the parties to join in bringing the formal contract into existence and then to carry it into execution. Meaning no disrespect to counsel, we consider the applicable principle to be capable of statement in far simple than he has sought to do. An agreement to make an agreement does not result in a contract. It is for the court in each case to construe the correspondence exchanged between the parties and to say whether that is the result intended by the parties. If the court reaches an opposite conclusion, then there is an enforceable contract. Unless the approach we have stated is adopted, a party to a contract who – after having concluded his bargain – entertains doubts as to S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 30 this document via eFILING portal the wisdom of the transaction, may be in the unfairly advantageous position to invent all sorts of imaginary terms upon which disagreement may be expressed when the more formal document is being prepared in order to escape from his solemn promise. Businessmen would find the law to be huge loophole and commerce would come to a virtual standstill. The law leans in favour of upholding bargains and not in striking them down willy-nilly, and its declared policy finds expression in the speech of Lord Wright in Hillas & Co v. Arcos Ltd [1932] All Rep 494 where he said: Businessmen often record the most important agreement in crude and summary fashion; modes of expression sufficient and clear to them in the course of their business may appear to those unfamiliar with the business far from complete or precise. It is, accordingly, the duty of the court to construe such document fairly and broadly, without being too astute or subtle in finding defects; but on the contrary, the court should seek to apply the old maxim of English law, verba ita sunt intelligenda ut res magis valeat quam pereat. That maxim, however, does not mean that the court is to make a contract for the parties, or to go outside the words they have used, except in so far as there are appropriate implication of law, as, for instance, the implication of what is just and reasonable to be ascertained by the court as matter of machinery where the contractual intention is clear but contract is silent on some detail. This principle applies not only to document drafted by laymen, but also to those prepared by lawyers (see Australia Broadcasting Commission v Australia Performing Right Association Ltd [1976] 129 CLR 99).’ S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 31 this document via eFILING portal [55] Further, in Cipta Cermat Sdn Bhd v Perbandaran Kemajuan Negeri Kedah (2007) 2 MLJ 746 at page 753 and 754, CA, his Lordship Gopal Sri Ram (as he then was) said the following with regard to the term that ‘this offer is subject to the execution of a formal document’ between a developer and registered proprietor of the lands: - ‘[10] I am unable to accept the defendant’s arguments that this is a case where the execution of the formal written agreement was a condition precedent to there being a contract. The evidence points to quite opposite direction. And it is the defendant’s own evidence at that. Look no further than the testimony of DW4, the defendant’s deputy managing director at the material time. Her evidence was that the defendant would readily accept the balance purchase price even without a formal agreement being executed by the parties. That points to the formal agreement being an unimportant document to the contracting parties. So objectively speaking, the parties had already made a contract and the written agreement was a mere formality. Let me now refer to two authorities which are of considerable assistance. “[11] First, there is Rissiter v Miller [1878] 3 App Cas 1124. A piece of land had been divided into lots and a plan of the lots had been made. On the plan the proprietors printed out several conditions and on which the land might be let or sold including the price and size of each plot and the date of payment of the purchase price. It also contained a condition which stipulated that the purchaser should thereafter execute a deed embodying those condition. The purchaser made an offer to buy and he agreed to those conditions printed thereon. The vendor’s agent accepted the purchaser’s offer. The House of Lords held that there was a binding contract between S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 32 this document via eFILING portal the parties despite the fact that a formal deed had not been executed. Lord Blackburn said: But the mere fact that the parties have expressly stipulated that there shall afterwards be a formal agreement prepared embodying the terms which shall be signed by the parties does not itself show that they continue merely in negotiation. It is a matter to be taken into account in construing the evidence and determining whether the parties have really come to a final agreement or not. But as soon as the fact is established of the final mutual assent of the parties so that those who draw up the formal agreement have not the power to vary the terms already settled. I think the contract is complete. (Emphasis added). [12] Second, G Percy Trentham Ltd v Archital Luxfer Ltd [1993] 1 Llyod’s Rep 25. That was a case in which the like question as in present instance arose, namely, whether the parties had made a binding contract. Steyn LJ (as he then was) said that in such a case as the present, ‘the governing criterion is the reasonable expectation of honest men’ and that ‘the yardstick is the reasonable expectations of sensible businessmen’. [13] I have construed the evidence in this case in its totality. I have applied the yardstick of the reasonable expectation of sensible business to the fact. And in consequence I am driven to the conclusion that the plaintiff and defendant in the present case had really come to a final agreement even in the absence of the formal agreement which the defendant had sent to the plaintiff. In my judgment any other conclusion would be contrary to business common sense and would cut across the reasonable expectation of honest men.’ S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 33 this document via eFILING portal [56] With respect, in none of the cases cited above, was there a clause in the memorandum of understanding where the parties had expressly stipulated their intention as to whether the said document would constitute a valid and binding agreement between them in the form of Clause 4 of the MOU in the present case. More specifically, Clause 4 states: ‘CLAUSE 4 SUBJECT TO CONTRACT The agreement between parties is subject to and conditional upon the Formal Agreement being entered into and subject to Clause 2, 3 and 4 hereof, is not intended to be binding upon the parties until and unless the formal agreement is entered into’. [57] In other words, both Vijayan and AODA have made plain and obvious their intention as to whether the MOU ought to be treated as a valid and binding agreement – they have stipulated in clear words that they do not intend the MOU to be a valid and binding agreement until and unless a formal agreement is entered into. In other words, both of them have merely agreed to an agreement to enter into an agreement. [58] Both Vijayan and Brian Lu were businessmen and must be taken to know what they were doing and it would be reasonable for this Court to conclude that by the express words in Clause 4 of the MOU, as sensible businessmen, they had both agreed to the inclusion of Clause 4 into the MOU precisely to ensure that there will be no uncertainty as to their shared intention on the non-binding nature of the MOU. Both had understood and in fact desired that notwithstanding the series of communication between them leading to the execution of the MOU, S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 34 this document via eFILING portal the signing of the MOU itself would not be considered as a concluded bargain until and unless a formal contract has been executed. The fact that the MOU was prepared by Gentry Loh, a solicitor makes the case even more compelling. [59] Whilst it is true that sometime on 26.10.2017, AODM did forward a letter to its customers to notify that “effective from 1st October 2017, Advanced Optronic Devices (M) Sdn Bhd” had been “taken over by Advanced Optronic Devices (Aisa) Co. Ltd (Hong Kong)” and another letter also dated 26.10.2017 to notify its customers that there was a change in AODM’s banking details and providing the customers with the new banking details, the evidence suggests that these letters were in fact never authorised by Vijayan at all. This is clear from Vijayan’s email dated 10.11.2017 where he said thus: “Can you guys stop this kind of nonsense before we sign the agreement? This is really bad doing it behind my back” [60] In other words, Vijayan himself did not approve of AODA or Brian Lu acting on the supposition that there was already a valid and binding agreement before the formal agreement is executed. This is notwithstanding the fact that Vijayan had for his own expediency allowed Brian Lu to take over the affairs of AODM after he had left for Singapore on 1.10.2017. [61] Similarly, the fact that Gentry Loh had requested Oi Ling, the former Company Secretary of AODM, to: S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 35 this document via eFILING portal ‘prepare for the purpose of this matter as below: (i) such persons as the Purchasers (AODA) may nominate shall be appointed as directors of the Company all with effect from the Completion Date; (ii) such person as the Purchaser (AODA) may appoint shall be appointed company secretary/secretaries of the Company with effect from the Completion Date; (iii) there shall be submitted and accepted the resignation of the directors and company secretary all with effect from the Completion Date; and (iv) the transfer of the said Shares shall be approved for registration.’ and that on 9.11.2017, Oi Ling had forwarded the following to Brian Lu for his attention and comments: - (a) the Board of Directors’ resolution pertaining to Share Sale Agreement; (b) the Board of Directors’ resolution for appointment of additional director; (c) the Letters of resignation of Vijayan and one Hashbudin Bin Hashim as directors of AOD(M)SB; (d) the Board of Directors’ resolution for resignation of secretaries; (e) the Board of Directors’ resolution for appointment of additional secretary; (f) the Board of Directors’ resolution to approve transfer of shares; and (g) the Forms of Transfer of Securities pursuant to Section 105 of the Companies Act 2016. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 36 this document via eFILING portal to my mind, do not at all mean that there was already in existence a valid and binding agreement. At best, these are merely preparatory steps taken in anticipation of the coming into existence a valid and binding agreement. What is clear from the correspondence is that Oi Ling was still taking instruction only from Vijayan. [62] In fact, this is clearly not a case where the terms and conditions of the formal agreement to be executed would simply contain similar terms and conditions as in the MOU. The condition where Vijayan was required to procure the Penang Project was not stated in the subsequent draft formal agreement and a requirement for a due diligence exercise which was not mentioned in the MOU was expressly provided for in the SSA. The aforesaid means that the parties had not concluded their negotiation on the terms. Quite plainly, the MOU expressly stated that the formal agreement shall not only contain terms and conditions in the MOU but it would also incorporate ‘such other terms and conditions as may be agreed upon between the parties’. [63] Accordingly, it is my judgment that the MOU itself is not a valid and enforceable agreement that is binding and enforceable. This means that the entire issue as to whether Vijayan had successfully procure the Letter of Award for the Penang Project as stipulated in the MOU is irrelevant. [64] The contention that there is a valid and existing agreement based on the terms of the SSA will now be considered. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 37 this document via eFILING portal [65] In this connection, it is pertinent to note the premise of the parties’ negotiations, more specifically, AODA’s position as regards AODM’s liabilities to third parties. Clause 1(iv) of the MOU expressly provides that AODA would not be liable for all and or any claims made against AODM prior to the purchase of the AODM shares. More specifically, it states: ‘Vijayan shall fully indemnify and shall keep AODA indemnified and harmless against all demands, costs, claims, proceedings, fines, penalties, losses, damages, litigation whatsoever involving AODM prior to and including the Completion Date. AODA shall be entitled to withhold the remaining sum should Vijayan refused and/or failed to indemnify AODA’ [66] The significance of the aforesaid is this – apart from paying the sum of USD 100,000.00 and 15% of AODA shares, AODA would not have to incur any further liabilities including settling AODM’s indebtedness to third parties. [67] From the evidence, it seems that almost immediately after Brian Lu took charge of the affairs of AODM in early October 2017, AODA had to issue a corporate guarantee dated 3.10.2017 to NEC Corporation to secure AODM’s indebtedness. This was followed by steps taken to procure a Promissory Note from Brian Lu’s mother, Lucy to AODM which was to be guaranteed by Vijayan. This again reflects AODA’s position that Vijayan was to indemnify AODA for all claims from third parties made against AODM. In Brian Lu’s email of 11.12.2017 to Gentry Loh, he instructed him thus: S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 38 this document via eFILING portal ‘Gentry, Please just have Vijay guarantee the NEC Loan that AODA is paying off. It was attached to one of the previous emails.’ [68] Coming back to the SSA, Gentry Loh had on 6.11.2017 circulated the draft SSA to both Brian Lu and Vijayan for their respective comments. This was expressed to be a preliminary draft that was subject to change as the words ‘”(Preliminary – Subject To Change”) were printed on every page of the draft. [69] Following a series of communication, Vijayan had returned the copy of the SSA to Gentry Loh’s office at Plaza Mont Kiara, Kuala Lumpur between 14.11.2017 to 30.11.2017. It is unclear whether the copy that was returned was the same draft SSA that was circulated. Vijayan had testified that he had returned a fair copy of the SSA. In any case, it is not disputed that the copy of the SSA that was returned bore Vijayan’s and Sujatha’s signatures. [70] However, AODA never signed the SSA at all. This is not in dispute. [71] Learned counsel for Vijayan sought to persuade this Court that an agreement based on the SSA had come into existence notwithstanding that only Vijayan had signed the SSA. He placed reliance on the case of Heller Factoring Sdn Bhd v Metalco Industries (M) Sdn Bhd (1995) 2 MLJ 153 CA where the Court of Appeal considered the position of an agreement which was only signed by the one party to the agreement, as to whether there was a concluded contract between the parties. Justice Mahadev Shankar JC (as he then was) observed S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 39 this document via eFILING portal that the mere fact that one party to the agreement had not signed the agreement did not necessarily mean that there could be no concluded contract. On the contrary, the Court of Appeal observed as follows at page 174 of the judgment: ‘It was strenuously submitted that because Matang had not dated or signed this document, there could be no concluded contract. We are unable to subscribe to this view. The true position is that where a contract has been signed by one party only, it can be enforced where there is evidence that the other party has elected to be bound by it. (See the cases in 12 English and Empire Digest (Contract) at p 193 para 1166 where Buckhouse v Crossby (1737) 7 Eq Cas. Abr 32; 22 ER 28 and other cases are referred to.) Part performance by one party, accepted by the other, is such other evidence. Delivery on 19 February was part performance.’ [72] The principles of law in Heller Factoring Sdn Bhd (supra) were cited with approval in the case of Chin Well Fasteners Co Sdn Bhd v Sampath Kumar Vellingiri & Ors [2006] 1 MLJ 117 CA, where the Court of Appeal observed that the plaintiffs, who were foreign workers from India, were entitled to the benefit from their employment contract although they had not signed the same. More specifically, the late Augustine Paul JC (as he then was) said the following at page 129 of the judgment: ‘[26] As stated earlier, the contract of employment was not signed by the plaintiffs nor did they know of its existence till the dispute between the parties arose while defendant had, being not fully aware of its contents, considered it to be a mere S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 40 this document via eFILING portal formality………The next issue to be determined is whether the plaintiffs can claim the benefits contained in the contract of employment as they have not signed it. As the defendant had agreed to its terms and had benefited from it by its use to obtain the release of the plaintiffs, the defendant is bound by it even though it is not signed by the plaintiffs. In support of this findings, reference is made to Heller Factoring Sdn Bhd v. Metalco Industries (1995) 2 MLJ 153 where Mahadev Shankar said at p 174: It was strenuously submitted that because Matang had not dated or signed this document, there could be no concluded contract. We are unable to subscribe to this view. The true position is that where a contract has been signed by one party only, it can be enforced where there is evidence that the other party has elected to be bound by it. (See the cases in 12 English and Empire Digest (Contract) at p 193 para 1166 where Buckhouse v Crossby (1737) 7 Eq Cas. Abr 32; 22 ER 28 and other cases are referred to.) Part performance by one party, accepted by the other, is such other evidence. Delivery on 19 February was part performance.” [27] Similarly in Subbrook Trading Lrd v Eggleton [1983] 1 AC 444, Lord Fraser said at p 484: Where an agreement which would otherwise be unenforceable for want of certainty or finality in an essential stipulation has been partly performed so that the intervention of the court is necessary in aid of a grant that has already taken effect, the court will strain to the utmost to supply the want of certainty even to the extent of providing a substitute machinery.’ S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 41 this document via eFILING portal [73] Similarly, in Aloka Bose v Parmatma Devi & Ors AIR 2009 SC 1527, the Indian Supreme Court rejected an argument that unless an agreement is signed by both the vendor and purchaser, there is not valid contract. Instead, the Supreme Court observed that a written agreement is valid even if it was signed by one party of the parties, if the written agreement evidences an oral agreement between the parties. The Supreme Court observed as follows at page 1530: ‘Therefore, even an oral agreement to sell is valid. If so, a written agreement signed by one of the parties, if it evidences such an oral agreement will also be valid.’ [74] Whilst I have no quarrels with the principles established in the cases cited, the question is whether AODA had in any way acted on the basis that the terms and conditions of the SSA had been accepted. In this regard, it is pertinent to note that: (1) AODA had never communicated to Vijayan that the SSA had been accepted; (2) AODA had never communicated to Vijayan that it had completed its due diligence on AODM and was satisfied with the same; (3) for the period from November 2017 to March 2018, AODA had not taken any steps to appoint any of its nominees as directors of AODM although Brian Lu and CYH had continued to be in charge of the management of AODM; S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 42 this document via eFILING portal (4) AODA did not present the Form of Transfer to register itself or its nominees as shareholders of AODM; (5) Equally significant is that Vijayan did not at any time during this period make any queries on the status of the SSA and or the restructuring of AODM’s board of directors and or shareholders. He did not resign as a director of AODM. The company secretary, Oi Ling continued to take instructions from him. His shares were not transferred to AODA or its nominees at all. Vijayan also did not ask about the progress of the due diligence exercise that was undertaken by AODA. [75] Accordingly, with respect to learned counsel for Vijayan, I am unable to find any factual basis in support of his contention that AODA had by its conduct accepted the terms and conditions of the SSA. This is so even if Brian Lu’s testimony that he had in fact flown to Singapore to inform Vijayan of AODA’s concern about AODM’s debts from its due diligence exercise is to be rejected. Further, to my mind, the fact that Vijayan had permitted Brian Lu to take control of AODM from 1.10.2017 merely indicates that the parties had proceeded along the assumption that an agreement for the sale of the AODM shares would take place. This, however, does not mean that there was already a valid and binding agreement in existence. [76] What is clear is that during the period from 1.10.2017 until early February 2018, what took centre stage was the need to address the insufficiency of funds in AODM to meet the claims made from its S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 43 this document via eFILING portal suppliers, in particular, the debts owed to NEC Corporation which amounted in excess of RM 3 million. Discussions were led by Brian Lu with NEC Corporation to settle the debts owed by AODM. Vijayan was personally exposed to this debt as he had executed a personal guarantee for the same. [77] Sometime on 12.3.2018, after a series of email exchanges between AODM and NEC Corporation, an agreement was reached in February 2018 to proceed with a tri-partite agreement involving NEC Corporation, AODM and AODA relating to the settlement of amounts outstanding to NEC Corporation from AODM. Pursuant thereto, a settlement agreement was prepared dated on 12.3.2018 where NEC Corporation, AODA, AODM and Vijayan were named as parties thereto. Significantly, Vijayan was made a party to the said agreement as guarantor for the repayment by AODM to NEC Corporation of all monies due and owing by AODM to NEC Corporation. In the copy adduced before this Court, only AODA had executed the said agreement. [78] Sometime on 23.3.2018 when NEC Corporation was pushing for AODM to execute the settlement agreement, Oi Ling spoke of the fact that AODM ‘is in the midst of restructure of the Board’ and indicated that it would preferable that the said document ‘be signed by the new directors, Mr Sam and Mr Brian’. “Mr Sam’ and “Mr Brian’ are YSP and Brian Lu respectively. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 44 this document via eFILING portal [79] In fact, sometime on 20.3.2018, NEC Corporation lost patience and commenced a legal action against AODM and Vijayan seeking the payment of RM 2,295,132.00 for goods sold and delivered to AODM (‘the NEC Action’). The said sum was a reduced amount from the original outstanding sum of RM 3, 278, 760.00 after AODA had agreed to NEC Corporation setting off its debts to AODA against the debts owed by AODM. This legal action had prompted AODA to halt the execution of the settlement agreement with NEC Corporation as evidenced in Brian Lu’s email of 26.3.2018. [80] Following further discussions, sometime on 30.3.2018 the settlement agreement was finally executed by all the parties. Following the settlement agreement, on 26.4.2018, a consent judgment was recorded in the NEC Action. [81] To my mind, it is not a mere coincidence that during this period of negotiation with NEC Corporation, there was simultaneously, a separate and parallel arrangement being carried out between Oi Ling and Gentry Loh where preparations were being made to procure the change in AODM’s board of directors and signatories to its bank account. More specifically, steps were taken for Gentry Loh and YSP to be appointed as additional directors of AODM. Brian Lu was made as a Group A authorised signatory of AODM bank account for any amount. For completeness, Brian Lu was subsequently appointed as a director of AODM sometime on 25.2.2019. Vijayan was also asked to sign his resignation as a director of AODM. In fact, Vijayan signed the board resolution appointing Gentry Loh and YSP as directors of S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 45 this document via eFILING portal AODM. He was also asked to sign the Share Transfer Form for his 249,999 AODM shares. [82] Based on the search made from SSM, Vijayan and one Hasbudin Bin Hashim resigned as directors of AODM on 23.4.2018 and in their place, YSP and Gentry Loh were appointed as directors of AODM. [83] Further, subsequent to the settlement agreement dated 30.3.2018 with NEC Corporation, AODM issued an undated letter duly signed by Brian Lu as ‘CEO’ to Vijayan stating thus: ‘2. In consideration of you, Vijayan A/L S Chinnasami resigning as a director of Advanced Optronic Devices (Malaysia) Sdn Bhd, we hereby: (a) absorb all your obligations and liability under the Settlement Agreement dated 30 March 2018 between NEC Corporation of Malaysia Sdn Bhd (“NEC”), Advanced Optronic Devices (Asia) Co. Ltd, Advanced Optronic Devices (Malaysia) Sdn Bhd (“AODA”) and yourself (“Settlement Agreement”) and under the Personal Guarantee; and (b) release and discharge you from your obligations under the Personal Guarantee and/or under the Settlement Agreement, and that you are hereby absolved from any repayment obligation to NEC of all monies due and owing by AODM together with all interest, costs and expenses thereunder.’ [84] The significance of the aforesaid letter cannot escape notice. As alluded to earlier, in the MOU, the parties had provided under Clause S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 46 this document via eFILING portal 1(iv) that Vijayan would indemnify AODA of all claims made against AODM prior to and including the Completion Date. This suggests that AODA did not expect to bear any of AODM’s liabilities at all when purchasing the shares of AODM. However, as alluded to above, in the SSA, this clause was not stated. Instead, provisions were made for due diligence to be undertaken by AODA. During the period from the time Gentry Loh received the SSA from Vijayan until February 2018, AODA made no attempt to sign the SSA. Further, whilst AODA was prepared to issue its guarantee to NEC Corporation, it was on the basis that Vijayan would indemnify AODA in the event that the guarantee was called. [85] Accordingly, Vijayan’s release and discharge from his personal obligations under the Personal Guarantee and under the Settlement Agreement appears to be a departure from AODA’s original position under the MOU and or the SSA. This release and discharge in consideration of Vijayan’s resignation as a director of AODM was simultaneously followed by the appointment of Gentry Loh and YSH as new directors of AODM and the change of signatories to the bank account of AODM. It would appear that new Transfer Forms for Vijayan’s AODM shares were also procured sometime on 4.5.2018 and presented for stamping. [86] The aforesaid suggests that Vijayan’s AODM shares were transferred pursuant to a fresh arrangement and not pursuant to the MOU and or the SSA. There would have been no necessity to secure Vijayan’s resignation as a director of AODM as consideration for his release if S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 47 this document via eFILING portal both Vijayan and AODA had treated the SSA as a binding and enforceable agreement. This is because under the terms of the SSA, Vijayan was obliged to resign as a director of AODM. Further, even with the change in the directorships and signatories to the AODM’s account and even after handing over the Share Transfer Form for his shares, Vijayan did not make any demand for payment of the USD 100,000.00 at all. Instead, all that Vijayan did was to issue the email on 23.5.2018 declaring that he had ‘delivered the requirements in item 1(ii) as per the MOU’ and seeking ‘the timing of the payment and the 15% share transfer’ when such requirement was not even contained in the SSA that he signed. [87] I find that Vijayan’s said electronic mail to Brian Lu and Gentry Loh on 23.5.2018 as nothing more than a disingenuous attempt to salvage a loss cause. I accept Brian Lu’s testimony that Vijayan was desperate to finalise the SSA and this is demonstrated by the fact that he had falsely procured Sujatha’s signature in both the SSA and the Transfer Form just so that the SSA could be proceeded with. The fact is that the full extent of AODM’s liabilities were not disclosed from the audited financial statements of the company. This is probably why upon Brian Lu’s discovery of the existence of various claims against AODM, AODA had insisted on conducting a proper due diligence exercise in the draft SSA. [88] To my mind, the aforesaid facts lend support to Brian Lu’s testimony that an understanding was indeed reached with Vijayan that with AODA settling AODM’s debts and releasing Vijayan from his S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 48 this document via eFILING portal indemnity, Vijayan would transfer his entire AODM shares to AODA and or its nominees. Whilst it is true that the ‘consideration’ stated in the Share Transfer Form for Vijayan’s shares was RM 249,999.00, it was never intended that such a sum needed to be paid. In fact, this stated ‘consideration’ goes against Vijayan’s case that the shares were transferred based on the terms of the SSA. [89] Learned counsel for Vijayan asked this Court to reject all evidence relating to any understanding reached between AODA and Vijayan on the transfer of his shares in consideration of his release from personal liability on the ground that this contention was never pleaded by AODA and or Brian Lu in their Defence. [90] With respect, whilst it would have been preferred if AODA and or Brian Lu had pleaded the said understanding in their Defence, nevertheless, the failure or omission to do so is not fatal to their Defence, which is simply that there was no valid and binding agreement created between Vijayan and AODA for the purchase of Vijayan’s AODM shares pursuant to the MOU and or the SSA. The burden is on Vijayan to establish that there was such an agreement. This, unfortunately, Vijayan has not established on the balance of probabilities. [91] In the premises, Vijayan’s claims against AODA and Brian Lu premised upon the MOU and SSA are dismissed. [92] This necessarily means that Vijayan’s claims against YSP for failure of consideration, conversion and constructive trustee cannot be S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 49 this document via eFILING portal sustained. As legal owner of the AODM shares, AODA is entitled to have the said shares transferred to YSP to hold the same as its nominee. Similarly, Vijayan’s claims against CYH and the 8th Defendant (‘Mohd Hazmil’) based on constructive trust and knowing receipt and or knowing assistance also cannot be maintained for the same reason. [93] I shall now deal with Vijaya’s claims against Gentry Loh and Messrs Frank Ch’ng. [94] Gentry Loh is the lawyer appointed by Brian Lu to draft the relevant documents in respect of the proposed sale of shares. Vijayan claimed that Gentry Loh also acted for him as his lawyer. The causes of action against Gentry Loh are: a) Fraudulent misrepresentation and/or deceit; b) Breach of duty of care and skill in contract and/or tort and/or equity; c) Breach of fiduciary obligations and/or breach of trust. [95] As Gentry Loh was at the material time a partner of Messrs Frank Ch’ng, Vijayan has also sought to make them liable as well in respect of the same causes of action. Hence, in the event this Court finds that the claims against Gentry Loh are unsustainable, the claims against Messrs Frank Ch’ng must necessarily be dismissed as well. [96] Each of the causes of action shall now be dealt with in turn. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 50 this document via eFILING portal Fraudulent misrepresentation and/or deceit [97] Vijayan alleged that Gentry Loh had made the following representations that he had been induced by and in reliance thereto acted on to sign the SSA, namely: a) that AODA had agreed to purchase Vijaya’s entire shareholdings in AODM for USD 100,000.00 and 15% of AODA shareholdings; b) that Gentry Loh’s law firm had agreed to act for Vijayan and Brian Lu in relation to the sale and purchase of Vijayan’s 249,999 ordinary shares each of RM1.00; c) that AODA had executed the MOU and the SSA signed by Vijayan; d) that AODA will honour the terms and conditions of the SSA signed by Vijayan. (‘the Representations’) [98] Vijayan also alleged that Gentry Loh is estopped by conduct from denying that he made the Representations on the ground that Gentry Loh had retained the MOU, SSA and the Transfer Instruments and did not dissent from, object or demur to any of the terms within a reasonable period, and that Gentry did not notify or inform Vijayan that AODA had not signed the SSA, the non-finalisation of the SSA and or termination of the SSA agreement. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 51 this document via eFILING portal [99] I find no merits at all in Vijayan’s claims for misrepresentation. [100] In the first place, Gentry Loh did not and could not be making the Representations to Vijayan as alleged as Gentry Loh was never a party to the commercial negotiations between Vijayan and AODA. Gentry Loh was never involved in the arrangement of the shares transfer nor played a part in the negotiation in finalising the terms of the transfer of Vijayan’s AODM shares to AODA. The parties to the commercial negotiations were at all times only between Vijayan and Brian Lu. [101] Indeed, Vijayan could not provide any specific instances when the Representations were supposedly made by Gentry Loh. [102] As regards the issue on estoppel, it is my view that the fact that Gentry Loh had the MOU and the SSA signed by Vijayan without more cannot give rise to any estoppel against him. As for the Transfer Instruments, there is no evidence whatsoever that the same were ever sent to Gentry Loh at all. [103] It is not for Gentry Loh to dissent from, object or demur to the terms of the MOU or the SSA or Transfer Instruments, as he was not a party to the commercial negotiations between Vijayan and Brian Lu or AODA. [104] More fundamentally, there is no evidence that Gentry Loh had met or engaged with Vijayan prior to Brian Lu introducing Gentry Loh to Vijayan via email. By his own admission, Vijayan testified that he had S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 52 this document via eFILING portal met Gentry Loh only twice – both occasions were after the parties had signed and executed the MOU. [105] Even so, Vijayan did not produce any evidence to show that during these two meetings, Gentry Loh had made any representations to induce him to sign the SSA, which is expressly marked as “(Preliminary- Subject to Change)” or had caused him to believe that AODA would honour the terms of the SSA. [106] In fact, contrary to the contention by counsel for Vijayan, there is also no evidence that Gentry Loh made any representation that his law firm, Messrs Frank Ch’ng had agreed to act for both Vijayan and AODA in relation to the sale of Vijayan’s AODM shares. Instead, the evidence disclose that Gentry Loh was merely the lawyer who drafted documents based on the instructions he received from Brian Lu. [107] In this connection, it must also be noted that the terms in the Letter of Engagement dated 21-9-2017 between Messrs Frank Ch’ng and AODA clearly stated that Gentry Loh and Messrs Frank Ch’ng were appointed to, inter alia, provide legal services in respect of the drafting of letters, agreements and contracts in AODA’s ordinary course of business. [108] That Brian Lu had not acted for Vijayan is evident from the fact that Vijayan would have to go through Brian Lu for changes to be made on the MOU and or SSA. This is clear from Vijayan’s answers during cross examination: S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 53 this document via eFILING portal Notes of Evidence of the afternoon session on 21.2.2022, page 50:- CC: You were aware that this MOU that Brian sent was drafted by Gentry? Vijayan: Yes. CC: But you had to go through Brian to make changes to the MOU correct? Vijayan: Correct. [109] At all material times, Gentry Loh had only acted on the instruction of Brian Lu who was the director of AODA. Gentry Loh had in his testimony, repeatedly emphasised that the instructions to draft the MOU and draft SSA came only from his client, which was AODA and or Brian Lu at the material time. [110] Gentry Loh’s testimony was corroborated by Brian Lu whereby Brian Lu had confirmed that he had not consulted Vijayan in respect of the appointment of Gentry Loh and or Messrs Frank Ch’ng in drafting the MOU and draft SSA for the proposed sale of Vijayan’s AODM shares. Vijayan had no knowledge nor say in the appointment of Gentry Loh and was only made aware of this when Brian Lu informed him of the same. [111] In the course of preparing the MOU and SSA, the instruction was given to Gentry Loh by Brian Lu. There is no evidence that Gentry Loh had to consult Vijayan or seek Vijayan’s instructions before drafting the MOU and SSA. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 54 this document via eFILING portal [112] Without evidence to the contrary, the only conclusion that can be drawn is that Gentry Loh was merely appointed and retained as the lawyer to draft the documents such as the MOU and SSA based on the instructions he received from his client, AODA via Brian Lu. [113] Learned counsel for Vijayan had relied on the following grounds to substantiate his contention that Gentry Loh was retained by him for the preparation of MOU and SSA: (a) Messrs Frank Ch’ng was stated as the “vendor’s solicitors” in the draft SSA (which was never finalised); (b) In the Pre-Action Discovery Suit, Messrs Frank Ch’ng and Oi Ling had confirmed that Gentry Loh was retained and appointed by Vijayan to carry out legal work; (c) The retainer fees were paid by AODM or Vijayan; (d) Gentry Loh had confirmed that he was the group legal advisor of AODM during the period when Vijayan was the majority shareholder of AODM; and (e) Gentry Loh had represented to AODM and Vijayan in the NEC suit to record the Consent Judgment dated 26-4-2018. [114] However, in contradistinction to the above, it is an undisputed fact that there was no letter of engagement between Vijayan and Gentry Loh. This was admitted by Vijayan in his testimony. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 55 this document via eFILING portal [115] Whilst it is true that Messrs Frank Ch’ng was named as the vendor’s solicitors in the draft SSA prepared by Gentry Loh, he had explained that this was merely a clerical error as the draft SSA was drafted on a template agreement from another file where the firm acted as the Vendor’s solicitors. [116] More importantly, the SSA that was sent to Vijayan and Brian Lu for comment(s) was a preliminary draft subject to change. This was evident by the notation at the top left of the document. Thus, the SSA was still a draft and the clerical error falls short of sufficient evidence to show that Gentry Loh and or Messrs Frank Ch’ng were indeed retained as solicitor for Vijayan. [117] Learned counsel for Vijayan had also relied on the Amended Defence filed by Messrs Frank Ch’ng where it had stated that Gentry Loh was retained and appointed by Vijayan to carry out legal works. [118] However, during cross-examination by Gentry Loh’s counsel, Mr Frank Ch’ng (who is currently the partner of Messrs Frank Ch’ng) agreed that he has no documents to prove that Gentry Loh was indeed appointed by Vijayan. In fact, Mr Frank Ch’ng testified that based on the contemporaneous documents, he concurred that the client’s name shown on the file register was AODA and not Vijayan or AODM. [119] The truth is that Mr Frank Ch’ng never had any personal knowledge of the work that was performed by Gentry Loh and he had assumed, quite wrongly that Gentry Loh had performed some personal works for S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 56 this document via eFILING portal Vijayan. It was clearly an averment that is not substantiated by any contemporaneous evidence. [120] More importantly, Vijayan has not adduced any evidence to prove that the legal fees were ever paid by him and/or AODM to Gentry Loh and/or Messrs Frank Ch’ng in respect of the legal services rendered by Gentry Loh. This is clear from his answers given during cross examination: Notes of Evidence of the morning session on 21.2.2022, pages 13,28 and 59:- CC: Fees for, fees for the preparation of the MOU and the SSA came from. Vijayan: Correct. CC: AODM. Vijayan: Correct. CC: Are you sure? Vijayan: Yes, and except that I can’t prove it unfortunately. … CC: Ok not correct, and you have no evidence that you have ever agreed on any terms of engagement, gotten any fee quote, receipt, any invoices, or make any payment for legal fees to the 3rd and 4th defendant, there’s no evidence, you can agree or disagree? Vijayan: That’s agree I agree. … YA: Apart from you asserting that erm AODM made the payment of the legal fees, do you have any S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 57 this document via eFILING portal documentary evidence at all to show the payments were made by AODM to Gentry? Vijayan: No I don’t I don’t. [121] On the contrary, when Vijayan was guided through the contemporaneous documents by Gentry Loh’s counsel during the cross-examination, he agreed that the invoices and receipts from Messrs Frank Ch’ng were issued to AODA instead of AODM. [122] AODM only started paying the invoices from Messrs Frank Ch’ng after the AODM shares had been transferred to its nominees. [123] There is a need to also address the occasion where Gentry Loh had introduced himself as AODM’s group legal advisor which learned counsel for Vijayan had relied on to contend that Gentry Loh and or Messrs Frank Ch’ng were acting for him. [124] In this regard, I accept the clarification by Gentry Loh in his Witness Statement where he explained that the purpose of introducing himself as AODM’s group legal advisor was to allow him to participate in the negotiation to record the consent judgment in the suit commenced by NEC Corporation. He merely did this upon the instruction of his client, AODA and its director, Brian Lu. This was confirmed by Brian Lu in his testimony during the cross-examination by Gentry Loh’s counsel where Brian Lu testified that he instructed Gentry Loh to assist in the negotiation with NEC Corporation as AODM needed the legal representation. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 58 this document via eFILING portal [125] Even though Gentry Loh was introduced as AODM’s lawyer, his legal fees in relation to the negotiation and consent judgment with NEC Corporation were nevertheless also paid by AODA. This proves that Gentry Loh had only acted upon AODA’s and or Brian Lu’s instructions including the legal representation for AODM in the settlement with NEC Corporation. [126] Accordingly, based on the contemporaneous evidence tendered before this Court, it is my finding that there was no retainer between Vijayan and Gentry Loh for legal service. [127] Gentry Loh was introduced by Brian Lu to Vijayan as AODA’s lawyer and not as Vijayan’s lawyer nor common solicitor for both Vijayan and AODA. At the material time, there was no attempt by Vijayan to correct AODA or clarify that Gentry Loh was also acting for him in the preparation of the MOU and SSA, if indeed Gentry Loh was also Vijayan’s lawyer as alleged. [128] Thus, there was no solicitor-client relationship between Vijayan and Gentry Loh, whether expressly or by implication. The contemporaneous documents including communications between the parties at all material times clearly show that Gentry Loh only acted for AODA and not Vijayan. [129] It is trite law that a solicitor only owes a duty of care to his own client and not to the client’s adversary or opponent. Thus, Gentry Loh owed S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 59 this document via eFILING portal no duty of care and skill in contract and or tort and or equity to Vijayan in this case. More specifically, he was: (1) not obliged to inform Vijayan whether or not AODA had executed the SSA; (2) not oblige to advise Vijayan not to pre-sign the Transfer Instruments under Clauses 1(iii)(a) of the MOU and or Section 3.02(1)(a) of the SSA before the execution of the SSA by Vijayan. In this regard, the Transfer Instruments were prepared by the AODM’s company secretary, who at the material time took instructions from Vijayan. It is not for Gentry Loh to advise Vijayan on the signing of the Transfer Instruments. In fact, it is also not clear what Transfer Instruments Vijayan had pre-signed, as he admitted at the trial that he signed multiple transfer forms as “they keep changing who to transfer to”; (3) Not oblige to take any or any adequate measures to protect Vijayan’s interest with regard to his 249,999 AODM shares as Vijayan was not Gentry Loh’s client but a counterparty in the transaction; (4) not oblige to inform Vijayan at any material times that he could not and or would not be able to act for him because of the conflicting interest since Gentry Loh only acted for AODA; S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 60 this document via eFILING portal (5) not oblige to advise Vijayan to seek independent legal advice elsewhere since by his conduct Gentry Loh had induced Vijayan to believe that he was indeed acting for him. [130] As regards the contention that Gentry Loh had wrongly permitted himself to be appointed as a director of AODM, the contemporaneous documents show that Vijayan was aware of Gentry’s appointment as a nominee director of AODA. In fact, Vijayan himself consented to such appointment, which was evident in him signing the resolutions appointing Gentry Loh as a director. [131] The contemporaneous documents further show that Vijayan had voluntarily resigned as a director as he signed the letter of resignation and the emails exchanged pertaining to his letter of resignation were also copied to him. As alluded to above, Vijayan even obtained an indemnity from AODA to release and discharge him from the obligations under the Settlement Agreement with NEC Corporation and for his Personal Guarantee given to them as consideration for his resignation as director of AODM. [132] By reason of the aforesaid, it is my judgment that Vijayan’s claims against Gentry Loh and Messrs Frank Ch'ng have no legal and factual basis and cannot be sustained. [133] As regards the Oral Side Agreements, learned counsel for Vijayan has opted to abandon the same. S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 61 this document via eFILING portal [134] What is left is AODA’s Counterclaim for Vijayan to fully indemnify AODA against all payments that it had made on behalf of AODM in the event that this Court finds that there was no valid and binding agreement for the sale of the AODM shares to AODA. [135] With respect, given AODA’s own evidence that Vijayan had agreed to the transfer of his AODM shares in consideration of AODA agreeing to release and discharge him of his obligations under the NEC Settlement and his Personal Guarantee, I cannot see how AODA can maintain its Counterclaim. [136] Accordingly, AODA’s Counterclaim is also dismissed. [137] On the question of costs, I order the Plaintiff to pay the sum of RM 20,000.00 to the 1st, 2nd, 5th, 6th, 7th and 8th Defendants, the sum of RM 35,000.00 to the 3rd Defendant and the sum of RM 20,000.00 to the 4th Defendant as costs. 1st Defendant counterclaim is dismissed with costs fixed at RM 5,000.00. All payments of costs to be subject to allocator. Dated on the 20th day of August 2022 ONG CHEE KWAN J Judge of the High Court of Malaya High Court of Kuala Lumpur, NCC2 S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 62 this document via eFILING portal COUNSEL: 1. Mr. Wong Hin Loong together with Mr. Sakthy Vell Saminathan for Plaintiff Messrs Sakthy Vell (Batu Caves) 2. Ms. Stephanie Wong for 1st, 2nd and 5th to 8th Defendants Messrs. Stephanie Wong Chambers (Shah Alam) 3. Ms. Claudia Cheah together with Ms. Aufa Radzi for 3rd Defendant Messrs. Skrine (Kuala Lumpur) 4. Mr. Robert Low together with Mr. Ahmad Shahrizal Abdul Aziz for 4th Defendant Messrs. Ranjit Ooi & Robert Low (Kuala Lumpur) CASE REFERENCE: 1. Charles Grenier Sdn Bhd v Lau Wing Hong [1996] 3 MLJ 327 2. Cipta Cermat Sdn Bhd v Perbandaran Kemajuan Negeri Kedah (2007) 2 MLJ 746 3. Heller Factoring Sdn Bhd v Metalco Industries (M) Sdn Bhd (1995) 2 MLJ 153 CA 4. Chin Well Fasteners Co Sdn Bhd v Sampath Kumar Vellingiri & Ors [2006] 1 MLJ 117 CA 5. Aloka Bose v Parmatma Devi & Ors AIR 2009 SC 1527 LEGISLATION REFERENCE: 1. Section 105 of the Companies Act 2016 2. Order 24 Rule 7A of the Rules of Court 2012 S/N fBalnvgIUKarLvd/QHqww **Note : Serial number will be used to verify the originality of 63 this document via eFILING portal