Winding-up petitions require substantial evidence of mismanagement or illegal conduct, which must be proven by the petitioner.

Introduction

[1] This is a companies winding-up petition made pursuant to s 464 read with ss 465(1)(f) and (h) of the Companies Act 2016 .

[2] The Petitioner ("Dato' Khor") is an individual and minority shareholder of the First Respondent company. He holds 2,144,000 ordinary shares equivalent to about 30% of the total shareholding.

[3] The First Respondent ("Ga Yee") is a private limited company involved in the business of manufacturing and sale of furniture.

[4] The Second Respondent ("Dato' Sri K") and the Third Respondent are individuals and are husband and wife. They are the majority shareholders of Ga Yee and collectively hold 5,000,000 ordinary shares equivalent to 70% of the total shareholding.

Preliminary

[5] The affidavits that were filed for purposes of this Petition are as follows:

(i) Petitioner's affidavit verifying Petition affirmed by Dato' Khor on 22 February 2017; and

(ii) Respondents' affidavit to oppose Petition affirmed by Dato' Sri K on 13 March 2017.

[6] During case management, I directed that viva voce evidence as well as documentary evidence be additionally adduced in a trial.

[7] Accordingly, the trial took place for 9 days on 18-20 June 2018, 30-31 October 2018, 28-29 March 2019, 11 April 2019 and 17 May 2019. The trial documents were marked as bundles A1 to A3, B1 to B8 and C1 to C32 which were agreed by the parties to carry status A and/or B as identified therein. In the course of the trial, exhibits P1 and R2 were also admitted in evidence.

[8] The Petitioner called the following witnesses:

(i) Dato' Khor Wooi Chen ("SP1"), the Petitioner himself;

(ii) Takeshi Miyamoto ("SP2"), a former employee of Nitori Co Ltd of Japan;

(iii) Dato' Sri Chin Seak Huat ("SP3")("Dato' Sri Chin"), a former shareholder and director of Ga Yee; and

(iv) Richmond Leow Heng Thian ("SP4")("Richmond"), the former financial controller and chief executive officer of Ga Yee.

[9] On the other side, the Respondents called the following witnesses:

(i) Dato' Sri Naveenthakrishner a/l Kathirgamathamby ("SD1"), the Second Respondent himself;

(ii) Ahmad Abrar bin Rosidi @ Chik Rosdi ("SD2"), an employee in Ga Yee;

(iii) Cheah Beng Chim ("SD3"), the purchasing executive of Ga Yee;

(iv) Goh Kok Ling ("SD4"), the senior account executive of Ga Yee;

(v) Moganraju a/l Govindasamy ("SD5"), the manager of Ga Yee;

(vi) Norliza binti Mohamed ("SD6"), an advocate and solicitor and partner in the firm of Norliza & Associates; and

(vii) Dato' Abdul Fareed bin Abdul Gafoor ("SD7"), an advocate and solicitor and partner in the firm of VM Mohan, Fareed & Co

[10] After the close of the trial, the parties submitted their closing written arguments in chief and in reply as directed. Oral clarification with counsel was held on 9 August 2019.

Background Facts

[11] Ga Yee was incorporated on 23 November 1992 as a private limited company by shares owned by a Lim family. The authorized share capital is RM10,000,000.00 divided into 10 million shares of RM1.00.

[12] The original shareholders of Ga Yee on 25 March 2010 sold 2,144,000 shares in Ga Yee to Dato' Sri Chin and Dato' Khor with each holding 1,072,000 shares. Subsequently they increased their share holding in Ga Yee and as a result, Dato' Sri Chin and his nominee Teoh Ah Kim collectively held 5,000,000 shares and Dato' Khor held 2,144,000 shares. The directors of Ga Yee were then Dato' Sri Chin and his nominee Teoh Ah Kim. At the time, Dato' Khor was not a director of Ga Yee but was a co-signatory with Dato' Sri Chin of the accounts and cheques of Ga Yee.

[13] There was a law suit which ensued between Dato' Sri K and Dato'