Shareholders must hold legal ownership of shares to initiate derivative actions; lack of locus standi renders the claim frivolous and abusive.

[1] The first, second and third Defendants on the one part and the sixth to the sixteenth Defendants on the other part filed two separate Notice of Applications Enclosures 90 and 94 respectively to strike out the Writ and Statement of Claim dated 24 June 2015 under O 18 r 19 Rules of the High 2012 (RoC 2012). I allowed the said applications. Thus this appeal by the first and second Plaintiff.

Parties

[2] The Plaintiffs are as follows:-

(a) the first Plaintiff, Ranjeet Singh Sidhu (Ranjeet); and

(b) the second Plaintiff, Tan Sri Syed Mohd Yusof bin Tun Syed Nasir (Tan Sri Syed Mohd Yusof).

both are collectively referred to as "the Plaintiffs".

[3] Whilst the Defendants are as follows:-

(a) the first Defendant is Zavarco PLC (Zavarco Plc) a company incorporated in the United Kingdom on or about 29 June 2011. Zavarco Plc was formerly known as Vasseti (UK) PLC;

(b) the second Defendant, Zavarco Bhd, a private company incorporated under the laws of Malaysia. It was formerly known as Vasseti Bhd;

(c) the second Defendant, Open Fibre Sdn Bhd, also a private company incorporated under the laws of Malaysia;

(d) the fourth Defendant is a legal firm, Messrs Gunavathy Manikam;

(e) the fifth Defendant is Messrs AR Yahya & Co;

(f) the sixth Defendant is Zulizman bin Zainal Abidin;

(g) the seventh Defendant is Ku Hasniza binti Hani Ku Hashim;

(h) the eighth Defendant is Roslina binti Ibrahim;

(i) the ninth Defendant is Shailen a/l Popatlal;

(j) the tenth Defendant is Tunku Mazlina binti Tunku Abdul Aziz;

(k) the eleventh Defendant is Zarudin bin Ramlee;

(l) the twelfth Defendant is Teoh Hock Peng;

(m) the thirteenth Defendant is Paneagle Holdings Bhd;

(n) the fourteenth Defendant is Vertu Capital Ltd a company incorporated in the Cayman Islands;

(o) the fifteenth Defendant is Aries Telecoms Ltd (Aries), a company incorporated in Jersey; and

(p) the sixteenth Defendant is Vinai Varayananda an individual of Thai national.

Factual Background

[4] The Plaintiffs brought this common law multiple derivative action in a representative capacity and for the benefit and on behalf of the 1st and 2nd Defendants. In their Statement of Claim the Plaintiffs pleads the following:-

(a) the Plaintiffs are shareholders of Zavarco Plc but they are not shareholders of Zavarco Bhd. However Zavorco Plc is the sole shareholder of Zavarco Bhd which in turn holds 91% of the shareholding of V Telecoms Bhd (V Telecoms). V Telecoms principal business is in the provision of fibre optic network. V Telecoms has licences as network facilities provider as well as network services provider (Telecommunication Business). The Telecommunication Business was at the material time, the core business of Zavarco Plc and Zavarco Bhd. V Telecoms is now known as Aries Telecoms (M) Bhd;

(b) for purpose of enhancing the Telecommunication Business Ranjeet and Shailen agreed V Telecoms would be injected into Zavarco Bhd and be part of a listing exercise. As part of the agreed collaboration Open Fibre was to be jointly owned by Ranjeet and Shailen. In furtherance thereto Open Fibre and Zavarco Bhd executed a share purchase agreement dated 13 December 2010 (2010 Share Swap). The terms of the 2010 Share Swap provides, among others, the following:-

(i) Open Fibre would transfer 1,046,000,000 ordinary shares held by Open Fibre in V Telecoms (approximately 91% of the ordinary shares in V Telecoms) to Zavarco Bhd; and

(ii) the consideration of Open Fibre's transf