A creditor can substitute as a petitioner in a winding up petition if they had the right to present it at the time of the original petition, regardless of being a judgment creditor.

JUDGMENT

(Substitution Of Petitioner)

Kenneth St James JC:

Prelusion

[1] The petitioning creditor in this winding up Petition settled with the respondent company (RCo). The petitioning creditor informed this Court that it wished to withdraw the Petition.

[2] The supporting creditors want RCo to be wound up. They oppose the withdrawal of the Petition. One of the supporting creditors—a bank— applies to substitute as the petitioning creditor, to proceed with the Petition.

[3] Should the application to substitute be allowed?

Parties And Preliminaries

[4] The petitioning creditor is Chantika Kelang Beras Sdn Bhd (Chantika).

[5] Chantika's ground to wind up RCo was for its inability to pay its debt to Chantika. But apart from the usual prayer that RCo be wound up, Chantika also prays for:

(1) a Dato' Dr Shanmughanathan Vellanthurai (Dato' Dr Shan) to be appointed the liquidator (and not the Official Receiver); and

(2) Dato' Dr Shan's remuneration to be charged on a time-cost basis.

[6] The creditors who gave their respective Notices Of Intention To Appear On Petition are Malayan Banking Berhad (MBB), United Overseas Bank (Malaysia) Bhd (UOB), CIMB Bank Berhad (CIMB), CIMB Islamic Bank Berhad (CIMB Islamic), Hong Leong Bank Berhad (HLB), Hong Leong Islamic Bank Berhad (HLB Islamic), Malayan Flour Mills Berhad (Malayan Flour), Prestasi Flour Mill (M) Sdn Bhd (Prestasi Flour), Sabah Flour & Feed Mills Sdn Bhd (Sabah Flour), and Kilang Beras Siong Heng Sdn Bhd (Siong Heng). I will refer to these creditors as the "participating creditors".

[7] The following is a schedule of the approximate amount of debt (rounded to the nearest thousand Ringgit) that RCo allegedly owes these creditors:

[8] All the bank-creditors support the Petition to wind up RCo, but all of them oppose the appointment of Dato' Dr Shan as the liquidator. All the non-bank-creditors similarly support the Petition, but they are silent on the appointment of Dato' Dr Shan as the liquidator.

MBB'S Application

[9] At the hearing of the Petition on 24 August 2023, Chantika informed the Court that they are negotiating with RCo to settle RCo's debt to them. As such, Chantika wanted to withdraw the Petition against RCo.

[10] MBB objected to Chantika's withdrawal of the Petition. MBB represented that they were informed about Chantika's intention to withdraw the Petition just before the hearing. MBB asked for time to consider applying to substitute as the Petitioner (the petitioning creditor), since Chantika is no longer interested in pursuing the Petition.

[11] UOB too objected to the withdrawal of the Petition. UOB represented that they were not even informed about the withdrawal of the Petition.

[12] It appeared that not only did Chantika not inform the participating creditors that they were withdrawing the Petition, they did not seek the participating creditors' consent to withdraw the Petition.

Pertinent Statutory Provisions

[13] The statutory provisions pertinent to MBB's Application to substitute are r 33 of the Companies (Winding Up) Rules 1972 (Rules), ss 464(1), 469(3), 465(1) and 466(1) of the Companies Act 2016 ( CA 2016).

[14] Rule 33 of the Rules provides that when a Petitioner (here: Chantika) wants to withdraw its Petition, this Court can substitute another party as the Petitioner. There are two requirements to do this:

(1) the substituting party has the right to present the Petition, and

(2) the substituting party wants to proceed with the Petition.

[15] Rule 33(1) is set out below for reference [With My Emphases In Bold]:

Rule 33. Substitution of any person as petitioner.

(1) When a petitioner is not entitled to present a petition or, whether so entitled or not, where he:

.

(b) consents to withdraw his petition or to allow it to be dismissed or the hearing to be adjourned; or

.

the Court may upon such terms as it thinks just substitute as petitioner any person who, in the opinion of the Court, would have a right to present the petition and who is desirous of proceeding with the petition.

[16] Sec