Interrogatories must be necessary for fair disposal or saving costs and should not contradict clear written agreements; vague or broad interrogatories are impermissible.

JUDGMENT

Atan Mustaffa Yussof Ahmad J:

[1] Before the court is an application for leave to serve interrogatories pursuant to O 26 Rules of 2012, filed by the defendants in the main action who are also plaintiffs in a counterclaim. The application arises in the context of a dispute over a Put and Call Option Agreement for shares in a public listed company, where the defendants had failed to meet their payment obligations. The defendants now seek to interrogate the plaintiff and two other parties whom they have joined as defendants in their counterclaim, primarily concerning alleged meetings and understandings that they claim varied the payment obligations under the written agreements. The application raises questions about the necessity and relevance of interrogatories at this stage of proceedings and whether the interrogatories serve a legitimate purpose in fairly disposing of the remaining issues or saving costs. At its core, this application requires the court to balance the defendants' right to obtain relevant information against the principles that govern when interrogatories should be allowed, including whether they amount to a fishing expedition or seek to contradict clear terms of written agreements.

Backgrounds Facts

[2] On 22 October 2021, Kenanga Investors Berhad ("KIB") who is the Plaintiff and the 1st Defendant in the Counterclaim, and Zulrafq Capital Sdn Bhd ("ZCSB") who is the 1st Defendant and 1st Plaintiff in the Counterclaim, entered into a Put and Call Option Agreement ("Option Agreement') relating to shares in KNM Group Berhad. Under this agreement, KIB granted ZCSB a Call Option to buy back from KIB RM40,000,000.00 worth of ordinary shares in KNM Group Berhad amounting to 190,476,190.00 shares ("Option Shares"). ZCSB also granted KIB an irrevocable Put Option to sell the Option Shares to ZCSB on the Maturity Date.

[3] On the same date, the 2nd Defendant and the 2nd Plaintiff in the Counterclaim, Tan Sri Zulhasnan Bin Rafique ("TSZ") executed a Personal Guarantee in favour of KIB to guarantee ZCSB's performance of its obligations under the Option Agreement.

[4] By letter dated 27 July 2022, ZCSB applied to KIB for an extension and rollover of the Call Option Period and Put Option Period for a further 9 months from the Maturity Date of 4 August 2022. This was followed by another letter on the same date setting out further terms to be varied via a supplemental agreement. KIB accepted these terms.

[5] A Supplemental Option Agreement was executed on 3 August 2022 between the parties ("Supplemental Option Agreement'). Under this agreement, ZCSB was required to pay a premium of RM4,800,000.00 by 15 September 2022 and a rollover fee of RM400,000.00 by 30 August 2022.

[6] On 2 May 2023, KIB issued a letter requiring ZCSB to purchase 190,476,190 Option Shares before or on 4 May 2023 for a total value of RM44,952,380.84. When ZCSB failed to do so, KIB's solicitors issued a letter of demand dated 19 June 2023 to both ZCSB and TSZ.

[7] A meeting was held on 28 December 2022 at KIB's premises between TSZ, Datuk Wira Ismitz Matthew ("Ismitz") (KIB's Executive Director/CEO) who is the the 3rd Defendant in the Counterclaim, Steve Ho (TSZ's adviser), and Duncan Ho (KIB's Head of Products and Business Development).

[8] On 29 August 2022, another meeting took place at the office of ZCSB's legal advisor, Messrs. Zul Rafique & Partners, attended by Taqiuddin, TSZ, Steve Ho and a lawyer named Mr David.

[9] Earlier, in September 2021, TSZ was appointed as Independent Non-Executive Chairman of KNM Group Berhad, alongside Steve Ho as Independent Non-Executive Director. TSZ was later re-designated as Executive Chairman on 23 November 2021.

[10] The Company (KNM Group Berhad) was classified as a PN17 company on or about 31 October 2022.

[11] KIB commenced legal proceedings against ZCSB and TSZ through three separate suits:

a) Suit No WA-22NCC-141-03/2023 ("Suit 141") regarding the extension and rollover fees

b) The present Suit No WA-22NCC-489-07/2