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2025 MarsdenLR 4884

HIGH COURT MALAYA KUALA LUMPUR
LEE QUAN YOONG & ANOR – Appellant
Versus
KOH HENG JIN HOLDINGS SDN BHD & ORS (ENCL 252) – Respondent
[Writ Of Summons No: WA-22NCC-216-05/2021]



Petitioner Advocates:V Kalearasu,Shoba Murugiah ,Respondent Advocate: Simon Hong

Only members or debenture holders may seek remedies for oppression under the Companies Act 2016, and the issue of locus standi is jurisdictional, allowing the court to address it regardless of whether it was pleaded.

Headnote:(A) Companies Act 2016 - Section 346 - Action for oppression by a member - The plaintiff, as executor and trustee of KPG's estate, lacks locus standi to bring an action for oppression as the estate is not a member of the company. The court ruled that remedies under s 346 can only be sought by members or debenture holders. The plaintiff's claim was struck out as unsustainable. (Paras 10, 12, 18, 29)

(B) Jurisdictional challenge - The court is entitled to consider issues of locus standi even if not pleaded, as they are jurisdictional. (Paras 21, 22)

(C) Res judicata - The doctrine does not apply as the issue of locus standi was not previously raised. (Paras 23, 26)

Facts of the case:
The plaintiff alleged oppression by the 2nd and 3rd defendants after KPG's passing, claiming unfair prejudice as a minority shareholder. The court found that KPG's estate was not a member of the company, thus lacking standing to sue. (Paras 4-5, 18)

Findings of Court:
The court found that the 1st plaintiff, as executor and trustee, could not pursue the claim for oppression due to lack of membership in the company. (Paras 10, 29)

Issues: The main issues were the 1st plaintiff's locus standi to bring an action for oppression and the applicability of res judicata. (Paras 20, 23)

Ratio Decidendi: The court held that only members or debenture holders can seek remedies for oppression under s 346 of the CA 2016, and the issue of locus standi is jurisdictional, allowing the court to address it even if not specifically pleaded. (Paras 12, 21)

Result: The court allowed the Striking Out Applications, striking out the plaintiff's claim against the defendants and the 6th defendant. (Paras 30)

Table of Content
1. court's final decision on the applications. (Para 2)
2. chronology of events and parties involved. (Para 3 , 4 , 5 , 6 , 8 , 9)
3. arguments regarding locus standi. (Para 10 , 20 , 21)
4. legal definition of membership and standing. (Para 11 , 12 , 14 , 15 , 16 , 18 , 19)
5. res judicata argument evaluation. (Para 23 , 24 , 26)
6. criteria for striking out claims. (Para 27 , 28 , 29)
Adlin Abdul Majid J:

A. Introduction

[1] The 1st to 3rd defendants filed separate applications (in encl 306 for the 1st defendant, and enclosure 252 for the 2nd and 3rd defendants) to strike out the 1st plaintiff's claim against them. I shall refer to the applications collectively as the "Striking Out Applications".

[2] After considering the evidence before the court and counsel's submissions, I allowed the Striking Applications and provided brief grounds for my decision. These are the full grounds of the decision.

B. Background Facts

[3] This action has gone through a series of changes, both in terms of the modes of proceedings and the parties involved in these proceedings. Thus, to ensure a full understanding, I will set out a complete chronology of this action.

[4] On 27 August 2020, Koh Peng Guan ("KPG") commenced this action by way of an originating summons. KPG, who held 200,000 ordinary shares in the 1st defendant (equivalent to 20% shareholding), alleged that he had been oppressed by inter alia, the conduct of the 2nd and 3rd defendants.

[5] KPG claimed that he and his late father Koh Heng Jin ("KHJ") were the ones responsible for the expansion and success of the 1st defendant. He claimed that after KHJ's passing, the 2nd defendant (who inherited the majority shareholding of the 1st defendant from KHJ) took control of the 1st defendant and ousted him from the management of the 1st defendant. KPG alleged that the 2nd and 3rd defendants had carried out oppressive acts against him and conducted the affairs of the 1st defendant in total disregard of his interest, resulting in his rights and interests as a minority shareholder of the 1st defendant being unfairly prejudiced.

[6] The 2nd and 3rd defendants applied to convert the originating summons into a writ. On 6 May 2021, the court allowed the application, after finding various conflicts of facts arising from allegations raised by KPG, including the misuse of the 1st defendant's funds, the creation of fictitious payment documents by the 2nd defendant and the manner in which the business of the 1st defendant was carried out. This decision was upheld by the court of Appeal.

[7] There were also numerous changes made to the parties to this action during the course of these proceedings. At the start of this action as an originating summons, the parties were as follows:

a. KPG, the plaintiff;

b. The company, the 1st defendant;

c. KPG's mother, the 2nd defendant;

d. KPG's siblings, the 3rd, 5th, 6th and 7th defendants; and

e. The 4th defendant, who are the 2nd and 7th defendants as executors and trustees of KHJ's estate.

[8] However, the following events occurred after the filing of the originating summons:

a. KPG passed away on 2 December 2020. His wife, Lee Quan Yoong ("LQY"), substituted herself as a plaintiff in this action in her capacity as the executor and trustee of KPG's estate.

b. The court struck out the plaintiff's claim against the 4th defendant by an order dated 6 May 2021. The 4th defendant is the 2nd and 7th defendants sued in their capacities as executors and trustees of KHJ's estate, and the court found that there could not be a cause of action for oppression against them in such capacity. They were in any event already sued in their personal capacities.

c. The plaintiff's claim against the 5th defendant was also struck out on 6 May 2021, as the court found that the 5th defendant was not involved in the management and had no knowledge of the operations of the 1st defendant.

d. The 2nd plaintiff (who was originally the 7th defendant) was transposed as a co-plaintiff by an order of court d

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