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2025 MarsdenLR 6132
HIGH COURT MALAYA KUALA LUMPUR
ADAM PRIMUS VARGHESE ABDULLAH – Appellant
Versus
KHEE SAN FOOD INDUSTRIES SDN BHD – Respondent
[Originating Summons No: WA-24NCC-455-09/2024]
The court held that comprehensive documentation is sufficient for assessing remuneration claims without the need for oral testimony, dismissing the conversion to a writ action due to lack of substantial factual disputes.
Headnote:(A) Companies Act 2016 - Section 407(4) - Judicial management - Application to convert originating summons to writ action dismissed - No substantial factual disputes warranting trial established - Comprehensive documentation provided by Interim Judicial Manager sufficient for assessing remuneration claim - Court emphasizes that detailed documentary evidence can resolve disputes without oral testimony. (Paras 7, 11, 18, 118)
Facts of the case:
The Plaintiff, appointed as Interim Judicial Manager, claims RM2.00 million for work done over 10 months. The Defendant contests the claim, alleging substantial factual disputes regarding the reasonableness of work and time spent, and seeks to convert the proceedings to a writ action. (Paras 1, 6, 12)
Findings of Court:
The court finds that the existing documentation is adequate to assess the Plaintiff's remuneration claim without necessitating a full trial, dismissing the Defendant's application for conversion. (Paras 118)
Issues: The main issues include whether substantial factual disputes exist that necessitate conversion to a writ action and whether the Plaintiff's remuneration claim can be adequately resolved through existing documentation. (Paras 7, 11, 118)
Ratio Decidendi: The court ruled that the extensive documentation provided by the Plaintiff is sufficient to assess the claim, and that the need for oral testimony is unnecessary given the clarity of the evidence presented. (Paras 18, 118)
Result: Application to convert originating summons to writ action dismissed with costs. (Paras 118)
| Table of Content |
|---|
| 1. application for judicial manager's remuneration (Para 1 , 2 , 3 , 4 , 5 , 6 , 7 , 8 , 9 , 10) |
| 2. arguments for conversion to writ action (Para 11 , 12 , 13 , 14) |
| 3. requirement for witness testimony (Para 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22) |
| 4. cross-examination sufficiency (Para 23 , 24 , 25 , 26 , 27 , 28) |
| 5. reasonableness of hourly rate (Para 34 , 35 , 36 , 37 , 38) |
| 6. allegations of self-serving entries (Para 44 , 45 , 46 , 47 , 48) |
| 7. counterclaim as basis for conversion (Para 53 , 54 , 55 , 56) |
| 8. discovery necessity (Para 59 , 60 , 61 , 62) |
| 9. pre-appointment and post-termination work (Para 68 , 69 , 70 , 71) |
| 10. sufficiency of documentation (Para 76 , 77 , 78 , 79) |
| 11. company's financial performance (Para 90 , 91 , 92 , 93) |
| 12. interaction with third parties (Para 98 , 99 , 100 , 101) |
| 13. taxation and remuneration assessment (Para 109 , 110 , 111 , 112) |
[1] Before the court is an application to convert an originating summons seeking remuneration of a former Interim Judicial Manager to a writ action. The former Interim Judicial Manager claims remuneration of approximately RM2.00 million for work done over a 10-month period while managing the Defendant company, based on a composite hourly rate of RM800.00 for himself and his team members. The Defendant opposes the remuneration claim and seeks conversion to a writ action on grounds that there are substantial factual disputes requiring trial, particularly regarding the reasonableness of the time spent and work done, while also seeking to pursue a counterclaim challenging the validity of the Interim Judicial Manager's appointment.
Background Facts
[2] The Plaintiff, Dato' Adam Primus Varghese bin Abdullah, was appointed as the Interim Judicial Manager of the Defendant, Khee San Food Industries Sdn Bhd, by way of an ex parte order dated 17 November 2021 in Kuala Lumpur High court Originating Summons No WA-28JM-21-11/2021 ("JM Suit') [Maybank Islamic Berhad v. Khee San Food Industries Sdn Bhd; Khee San Berhad (Intervener) ]. The JM Suit was commenced by Maybank Islamic Berhad ("Maybank"), which held 3.34% of the Defendant's total debt.
[3] The Defendant is a wholly owned subsidiary of Khee San Berhad ("KSB"), a public listed company. The Defendant is involved in manufacturing candy confectionery and wafer products. Its registered address is at No 5-9A, The Boulevard Offices, Mid Valley City, Lingkaran Syed Putra, 59200 Kuala Lumpur, while its business address is at Lot 1819-1824 and 1832, Jalan Kolej, Seri Kembangan, 43300.00 Selangor.
[4] The Plaintiff served as Interim Judicial Manager from 17 November 2021 to 1 September 2022. During this period, he was assisted by five personnel from his firm: Dato Nabhesh Khanna (Director), Macpherson Simon and Iswari Manokharan (Associate Directors), and Natasha Sophia and Jo Gan Pee Hui (Consultants).
[5] On 4 March 2022, the Plaintiff filed an application in the JM Suit for his remuneration ("First Remuneration Application") covering work carried out from 17 November 2021 to 4 March 2022, totalling 1,336.5 hours at a composite rate of RM800.00 per hour.
[6] On 1 September 2022, Maybank withdrew the JM Suit following a settlement reached between the financial institution creditors and KSB. This effectively terminated the Plaintiff's position. On the same date, the High court allowed RM2.00 million of the Defendant's funds to be held by the Plaintiff's then-solicitors, Messrs Zaid Ibrahim & Co ("Z/CO"), pending determination of the First Remuneration Application. The court also ordered the Defendant to set aside RM55,505.00 in a separate account.
[7] On 20 March 2023, the High court dismissed the First Remuneration Application as premature, finding that the Plaintiff had not complied with the prerequisites under s 407(4) of the Companies Act 2016 as the Plaintiff filed his first remuneration application without attempting to first obtain the Defendant's or the creditors' approval for his proposed fees.
