The court upheld the Liquidator's authority in waiving a debt during an online voting meeting, rejecting claims of procedural irregularities.

JUDGMENT

Azmi Ariffin J:

Introduction

[1] Enclosure 1 dated 25 March 2021 is the Notice of Motion filed by the Applicant (Emiprima Sdn Bhd) pursuant to s 486, s 510 of the Companies Act 2016 and/or any relevant provisions of Companies Act 2016 and/or Companies (Winding-Up) Rules 1972 and/or the inherent jurisdiction of the Court for the following orders:

(1) That leave be granted for Emiprima Sdn Bhd to make this application;

(2) That Resolution No 3 passed and carried by Liquidator vide WhatsApp Voting on 18 January 2021, namely "to approve outstanding amount of RM1,320,378.53 owing by Banting Sawit Enterprise (after all deduction and set off paid by Tan Peng Son) to be waived. Should it be not approved, the legal action to be proceeded with an estimated legal fees of RM900,000,00" to be set aside and be declared invalid;

(3) That the chargeable legal fees by the solicitors firm so engaged by the Liquidator for recovery of debt owing by Banting Sawit Enterprise shall require sanction from this Honourable Court before any paid out is made;

(4) That the costs arising from and incidental to this application be borne by the Company and paid out to the Applicant from the assets of the Company; and/or

(5) Such further orders and/or other directions be given and/or made as this Honourable Court deems fit and proper.

Brief Facts

[2] To recap, it is pertinent to set out the previous applications filed, the chronology of events and the earlier decision made by this Honourable Court in order to appreciate the factual matrix of the present case,

[3] Let me start with encl 139.

3.1 Enclosure 139 is the Wonderful Castle Sdn Bhd (In Liquidation) Liquidator's application vide Forms of Summons dated 16 August 2019 pursuant to s 237 (3) of the Companies Act 1965 and or/ s 487(3) of the Companies Act 2016 and / or under the inherent jurisdiction of this Honourable Court for the following orders:

(a) The Liquidator for the 1st Respondent in the best interest of all the creditors and contributories and in aid of the liquidation process of the 1st Respondent seek direction to enter into a settlement containing terms as per Annexure A;

(b) Costs of and incidental to this application be borne by the 1st Respondent; and

(c) Such further reliefs as this Honourable Court deems fit."?

3.2 The facts of the case may be summarised as follows:

(a) On 14 August 2015, Wonderful Castle Sdn Bhd (in Liquidation) ("the Company") was wound up and Datuk Tan Guan Pian was appointed as the Liquidator of the Company. There are 11 contributories of the Company and they are divided into two fractions i.e the Majority Contributories and Minority Contributories.

3.3 The Majority Contributories of the Company are as follows:

(a) Ch'ng Kiam Huat (20% of the equity);

(b) Lim Boon Chuan (15% of the equity);

(c) Tan Eng Soi (10% of the equity);

(d) Tan Peng Soon (10% of the equity);

(e) Ample Scope Sdn Bhd (7.5% of the equity);

(f) Tan Ah Seng (5% of the equity); and

(g) Ang Boon Kee (5% of the equity);

3.4 At this juncture it must emphasised that the Majority Contributories collectively hold 72.5 % of the equity in the Company.

3.5 The Minority Contributories of the Company are as follows:

a) Aik Soon Properties Sdn Bhd (10% of the equity);

b) Emiprima Sdn Bhd (10% of the equity);

c) Collective Gain Sdn Bhd (5% of the equity); and

d) Tiew Sun Hong (2.5% of the equity).

3.6 The Minority Contributories collectively hold 27.5 % of the equity in the Company.

3.7 On 16 August 2019, the Liquidator filed Forms of Summon vide encl 135 seeking from this Honourable Court direction to enter into a settlement under s 237 (3) of the Companies Act 1965 (now known as s 487 (3) of the Companies Act 2016 ) pertaining to the distribution of the Company's assets among the existing contributories. The proposed method of distributing the assets prepared by the Liquidator containing terms as per the Amended Annexure A of the Form of Summon has the consensus of all the Contributories except Emiprima Sdn Bhd (unsecured credi