Strict compliance with statutory requirements for obtaining leave under the Companies Act is mandatory, and failure to do so renders the action void ab initio.

JUDGMENT

Mohd Arief Emran Ariffin J:

A. Introduction

[1] This is the Applicant's application for an extension of time to file an application for leave to institute a derivative action on behalf of lotacs (M) Sdn Bhd that will be retroactive from the 6 January 2022 and 11 January 2022 ie the date when the memorandum of appearance is entered on behalf of the said company and in the proposed Counterclaim against the 1st, 2nd, 3rd and 4th Respondents before the Sessions Court in the suit bearing number WA-B52NCC-766-12/2021 and WA-B52-82-12/2021.

[2] This application was dismissed by this Court after hearing parties and the reason for the said decision is stated herein.

B. Background Facts

[3] A civil suit bearing number WA-B52NCC-766-12/2021 was instituted by lotacs Technology Sdn Bhd against lotacs (M) Sdn Bhd on 21 December 2021. A second civil suit bearing number WA-B52-82-12/2021 was instituted by UAT Air Conditioning Sdn Bhd against lotacs (M) Sdn Bhd on 22 December 2021.

[4] The Applicant then filed appearance on behalf of the lotacs (M) Sdn Bhd and its defence and counterclaim on 24 January 2022 in the civil suit bearing WA-B52NCC-766-12/2021 and included the 1st and 2nd Respondents as a party to the said suit as co-defendants to the Counterclaim. He also filed an appearance on behalf of lotacs (M) Sdn Bhd and also included a counterclaim on behalf of lotacs (M) Sdn Bhd in the civil suit bearing WA-B52-82-12/2021. He also added the 1st and 2nd Respondents as co-defendants in the Counterclaim in the said suit.

[5] The 1st and 2nd Respondents had then filed an application to strike out the said Counterclaim against them in the suit bearing number WA- B52NCC-766-12/2021 on 22 March 2022. The application is premised on the ground that the said Applicant did not obtain authorization to institute proceedings against the Respondents and did not obtain leave from the Court to institute proceedings against them in accordance with the requirements of the Companies Act . The issue of whether the Applicant had locus standi to institute proceedings on behalf of the company was part of the defence of the said Respondents.

[6] A summary judgment was entered against the said company by the Sessions Court on 29 July 2022 and 22 July 2022. This was overturned by the High Court on 15 May 2023. The case was subsequently fixed for a full trial that should have been heard on 26 June 2023 and 28 June 2023 as well as on 25 July 2023 to 28 July 2023. There was also an application to amend the defence to the Counterclaim.

[7] The Applicant had only issued a notice to the directors of the company on 7 August 2023 of his intention to obtain leave from the Court to institute a derivative action on 7 August 2023. This is about 1 year and 6 months after the Counterclaim was filed by the Applicant in the Sessions Court.

[8] The originating summons was only filed on 8 August 2023. This is about 1 year and 6 months after the Counterclaim was filed by the Applicant.

[9] After realizing its mistake in not applying for leave of the High Court, the Applicant decided to apply for leave and seek that it be given retrospective effect from the original date on which the said Counterclaims were filed.

[10] I note that there were summary judgments applications and appeals pertaining to the said summary judgments entered that were pending and eventually disposed by the Sessions Court and the High Court. However, the Applicant's suit and the Counterclaim by the company was not struck out by the lower Court. Despite the objections as to the locus standi of the suit and the right of the Applicant to institute those proceedings that were raised since 22 March 2022, the Applicant chose not to file this application at an early stage.

[11] No facts or circumstances prevented the filing of this application and no reasoning was afforded by the Applicant why this application was filed only 1 year 7 months after the Counterclaim was filed.

C. Reasoning Of This Court

[12] This application is