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2024 MarsdenLR 610

HIGH COURT MALAYA KUALA LUMPUR
KERK HAN MING – Appellant
Versus
LEE YU MENG & ORS – Respondent
[Originating Summons No: WA-24NCC-547-10/2023]



Petitioner Advocates:Dato J Shamesh,Kumarappan Ramasamy,Suzanne Kurian ,Respondent Advocate: Alvin Tang,Kang Zhen Leong

Cross-examination is essential in oppression claims to resolve material factual disputes and assess witness credibility, particularly in cases involving allegations of misconduct.

Headnote:(A) Companies Act - Section 216 - Cross-examination of deponents in oppression claim - Application for leave to cross-examine granted due to identified material factual disputes regarding quasi-partnership status and allegations of misconduct - Importance of oral evidence highlighted for resolving key issues. (Paras 1, 6, 10, 11, 12, 17)

(B) Cross-examination - Necessity for testing credibility of witnesses in oppression claims emphasized, particularly in light of conflicting affidavit evidence and allegations of bad faith. (Paras 21, 22, 36, 97)

(C) Delay in application - No inordinate delay found as application was made during ongoing exchange of affidavits, ensuring thorough examination of disputed facts. (Paras 77, 82, 87)

(D) Relevance of related proceedings - Findings from previous cases are pertinent to current oppression claim, necessitating consideration of broader context. (Paras 59, 66, 70)

JUDGMENT

(Enclosures 176)

Atan Mustaffa Yussof Ahmad J:

[1] This is an application by the 3rd Defendant, Wong Kok Kheong ("Wong"), for leave to cross-examine the deponents of affidavits filed in relation to the Originating Summons dated 5 October 2023 ("OS") in this matter. The application is opposed by the Plaintiff, Kerk Han Meng ("Kerk"), and the 2nd Defendant, Kua Chin Wee ("Kua"). The 1st Defendant, Lee Yu Meng ("Lee"), and the 5th Defendant, CJ Polymers Sdn Bhd ("CJ Polymers"), support the application. After careful consideration of the submissions and evidence before me, I am of the view that the application should be allowed for the following reasons.

Whether The 3rd Defendant Has Sufficiently Identified Relevant Disputed Facts That Warrant Cross-Examination And Are Relevant To The Core Issues In This Case

[2] Wong contends that there are multiple disputed facts which cannot be resolved by affidavit evidence alone and must be tested through cross-examination. In his affidavit supporting encl 176, Wong has identified several key areas of dispute, including whether CJ Polymers is a quasipartnership, Kerk's conduct relating to certain financial matters of the company, and allegations of misappropriation of company funds through a "Round-Tripping Exercise" involving offshore companies. Wong argues that these disputes go to the heart of the oppression claim and cannot be resolved without oral testimony.

[3] Lee and CJ Polymers support Wong's position, arguing that these disputed facts are crucial for determining whether oppression has occurred. They emphasise that the allegations of misconduct by Kerk, if proven, would defeat any legitimate expectation to management even if a quasi-partnership existed, citing Ngan Tuck Seng & Anor v. Ngan Yin Groundnut Factory Sdn Bhd, 1999 MarsdenLR 1407 .

[4] Conversely, Kerk argues that Wong has failed to sufficiently identify any relevant disputed facts warranting cross-examination. He submits that while there may be different positions taken by the parties, there are no substantial conflicts in the truth of the statements made or issues of fact that justify cross-examination. Kerk contends that the core issues of the OS relate solely to his removal as director and the allotment of shares to Wong, which he claims are based on undisputed facts and contemporaneous documents already before the court. He argues that these events, on their face, constitute oppressive conduct regardless of any broader context.

[5] Kua aligns with Kerk's position, contending that the alleged disputed facts are not relevant to the core issues of the OS or, at the very least, not essential to its determination. Kua argues that the court can determine whether oppression has occurred based solely on the undisputed events of Kerk's removal and the share allotment, without delving into the broader allegations of misconduct or the historical nature of the shareholders' relationship. He contends that introducing these additional issues would unnecessarily complicate and prolong the proceedings.

[6] After careful consideration, I find that Wong has adequately identified several material factual disputes that go to the heart of the issues in this case and are indeed relevant to the core issues. The question of whether CJ Polymers is a quasi-partnership is not merely relevant, but fundamental to the entire premise of Kerk's oppression claim. Without establishing the existence of a quasi-partnership, Kerk cannot lay claim to any legitimate expectation to management, and his claim of oppression premised on exclusion from management would fail. He would instead have to accept majority rule, as is typical in standard company structures.

[7] The importance of this issue is underscored by the confused and uncertain contentions made by Kerk in his affidavit evidence. There are glaring inconsistencies in Kerk's position regarding the quasi-partnership status of CJ Polymers:

a) In the current OS, Kerk claims that CJ Polymers is a quasi-part


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