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2021 MarsdenLR 4241
HIGH COURT MALAYA PULAU PINANG
NATURAL TRANSFORMS SDN BHD – Appellant
Versus
GTM LAND & PROPERTY SDN BHD & ORS – Respondent
[Companies Winding Up Nos: PA-28NCC-57-07/2020 PA-28NCC-61-08/2020 PA-28NCC-62-08/2020 PA-28NCC-63-08/2020 PA-28NCC-64-08/2020 & PA-28NCC-65-08/2020]
The court ruled a winding-up petition may be struck out on grounds of forum non conveniens where genuine disputes over share ownership exist, prioritizing resolution in appropriate legal proceedings.
Headnote:(A) Companies Act 2016 – Sections 464, 465(1)(f), and 465(1)(h) – Petitions to wind up Companies filed by contributor – Claims of genuine dispute over ownership of shares leading to petitioner's locus standi challenge – The court held the petition to be struck out on grounds of forum non conveniens, allowing liberty to refile once ownership is established (Paras 10-12, 39-40).
(B) Discretion on the exercise of forum non conveniens relating to winding up petitions – The court may dismiss such a petition if the ownership of shares is genuinely disputed, prioritizing resolution in a more appropriate forum (Paras 24-26).
(C) Acknowledgment of payments in share transactions - The court emphasized the inadequacy of mere acknowledgment as proof of payment without corroborating evidence (Paras 29-34).
Facts of the case: The Petitioner sought to wind up companies due to relationships with the respondent shareholders, claiming unfair treatment, while the latter disputed petitioner's status as a genuine shareholder.
Findings of Court: The decision struck out the winding up petition due to unresolved ownership issues, allowing future application pending determination in the writ action.
Issues: Primarily, whether the petitioner holds a legitimate capacity as a contributor amid genuine disputes over share ownership.
Ratio Decidendi: The court determined that pending litigation regarding true ownership of shares necessitated resolution prior to consideration of winding-up petitions, affirming adherence to established legal provisions on share ownership (Paras 10, 12, 39).
Result: Petition struck out with liberty to refile contingent upon establishing ownership.
JUDGMENT
[1] This matter concerned 6 petitions to wind-up a group of companies, namely: GTM Land & Property Sdn Bhd, GTM Noble Sdn Bhd, GTM Pretij Sdn Bhd, GTM Capital Sdn Bhd, GTM Timur Sdn Bhd and GTM Emerald Sdn Bhd ("collectively referred to as the "Companies"). The respective Companies were named as the 1st Respondents in each of the petitions.
Common/Related Parties
[2] The Companies shared the same contributories (or shareholders), namely:
(1) Natural Transforms Sdn Bhd, which was the petitioner in all the petitions; and
(2) Goh Choon Kim and Ong Ah Poh, who were the 2nd and 3rd Respondents respectively in all the petitions.
Sections 465 (1)(f) And 465(1)(h) Of The Companies Act 2016
[3] There was a falling out between the shareholders that led the Petitioner to petition to wind-up the Companies under ss 465(1)(f) and 465(1)(h) of the Companies Act 2016 (" CA ").
PA-28NCC-57-07/2020 to bind the other Petitions
[4] The Respondents, by way of notices of motion, applied to strike out the petitions. As the circumstances in the petitions and the basis for striking out the petitions were similar in all 6 cases, counsel agreed that the court need only hear the Respondents' application in petition PA-28NCC-57-07/2020 ("Petition") to wind-up GTM Land & Property Sdn Bhd ("Company"); and that the decision here would bind the other petitions. Hence, the court confined itself to hear the notice of notion ("Notice of Motion") in just this one Petition.
Striking Out On 2 Limbs
[5] The Notice of Motion comprised 2 distinct limbs:
(1) First, striking-out pursuant to O 18 r 19 Rules of 2012 ("RC") which, if granted, would dispose of the petition in finality ("O 18 r 19"); and
(2) Second, striking-out pursuant to the inherent jurisdiction of the court on the grounds that this Petition was forum non conveniens to decide on the issue of the Petitioner's locus standi - the question of whether the Petitioner was the real or beneficial owner the shares it held - which was the main issue in a pending Writ action, Penang High court Civil Suit No: PA-22NCVC-239- 12/2020 ("Writ") ("Forum Non Conveniens").
Unlike the O 18 r 19 limb, an order under this limb would not dispose of the petition in finality. The Petitioner will have the liberty to petition afresh to wind-up the Companies if and when they establish ownership of the shares in the Writ action and, hence, establish locus standi to petition to wind-up the Companies.
Decision
[6] After hearing submissions from respective counsel, I did not allow the Respondents' application to strike out the Petition in finality under the O 18 r 19 limb, but I allowed the Respondents' application tostrike out the Petition with liberty to file afresh on the Forum Non Conveniens limb.
Notice Of Appeal
[7] The Petitioner has appealed against the decision on the premise that I had allowed the Notice of Motion on both limbs. This is incorrect. As is apparent from the order itself, I only allowed the application under the Forum Non Conveniens limb, with liberty to file afresh. 1 did make an order under the O 18 r 19 limb, which would have struck out the Petition in finality. I take it that this is an oversight on Petitioner's part.
[8] The Respondent has not appealed against the decision not to grant their application under the O 18 r 19 limb.
Forum Non Conveniens Limb
[9] In the premise, I shall confine the grounds of judgment to the granting of the order on the Forum Non Conveniens limb. These are the grounds for my decision.
[10] The Petitioner petitioned to wind-up the Company in their capacity as contributory of the Company as they are entitled to under s 464 CA :
"464 Petition of winding up
(1) A company, whether or not it is being wound up voluntarily, may be wound up under an order of the court on the petition of any one or more of the following:
...
(c) a contributory..."
[11] And they petitioned to wind up the Company on 2 grounds under s 465 CA :
"465 Circumstances in which a company may be wouid up by the court
