Malaysia Case Law: Decisions & Judgments | LexChat

Malaysia Case Law

Fraudulent trading (s.540 ca 2016 / s.304 ca 1965)

  • 18 Jan 2023

    GOLDEN AFFINITY DEVELOPMENT SDN BHD 1. ) ES ENG SOON HOLDING SDN BHD 2. ) LIM BOON KANG 3. ) LIM BOON HUNG 4. ) SEE KOK SENG

    Citation
    WA-22NCC-210-05/2020 (Mahkamah Tinggi)
    Court
    High Court
    Case number
    WA-22NCC-210-05/2020 (Mahkamah Tinggi)

    The court held CA1965 applied to the December 2016 dividend and the dividend was paid out of profits as evidenced by financial statements, therefore the declaration was lawful; LAD claims had not crystallised at the time and fraud/fraudulent trading and conspiracy claims were not proved (deficient pleading, lack of contemporaneous evidence, no police report, infirmities in forensic evidence); four properties accepted at market value by JPPH while two properties were under-valued leading to limited recovery orders; Suit 472 largely dismissed except limited recovery for two properties; Suit 210…

    • Declaration and distribution of dividends
    • Solvency test vs dividends from profits
    • Fraudulent trading (s.540 ca 2016 / s.304 ca 1965)
    • Conspiracy to defraud
    • Proof of debt (pod) adjudication
    • Undervalue transactions and s.530 ca 2016

  • 18 Jan 2023

    GOLDEN AFFINITY DEVELOPMENT SDN BHD (DALAM LIKUIDA 1. ) LIM YOK WAH 2. ) LIM BOON KANG 3. ) SEE KOK SENG 4. ) LEE HAW HANN 5. ) ES ENG SOON HOLDINGS SDN BHD 6. ) ES ENG SOON PROPERTIES SDN BHD 7. ) HOE FOONG DEVELOPMENT SDN BHD 8. ) LEONG T

    Citation
    WA-22NCC-472-08/2019 (Mahkamah Tinggi)
    Court
    High Court
    Case number
    WA-22NCC-472-08/2019 (Mahkamah Tinggi)

    The dividend declaration of RM27,000,000 was lawful because it was made under the CA 1965 from profits (retained profit shown in audited accounts) and CA 2016 is not retrospective; Plaintiff failed to prove fraudulent trading or conspiracy on balance of probabilities, proof of debt adjudication by the Liquidator was flawed and some property valuations were accepted by independent valuer JPPH leading only to limited recovery for two under-valued lots; given the Liquidator's conduct and reliance on an internally linked forensic firm, costs are ordered personally against the Liquidator.

    • Declaration of dividends
    • Solvency test vs profits rule
    • Fraudulent trading (s.540 ca 2016 / s.304 ca 1965)
    • Conspiracy to defraud
    • Proof of debt adjudication
    • Liquidator conduct and personal costs