Back
2014 MarsdenLR 1693
HIGH COURT MALAYA PULAU PINANG
PER: LEONG KIN MUN; EX-PARTE: SIN SOON HOCK SDN BHD
[In Bankruptcy No: 29-2721-10/2013]
A bankruptcy notice is valid even if the underlying judgment is under appeal, provided it has not been set aside, establishing that the judgment is treated as final under the Bankruptcy Act.
Headnote:(A) Bankruptcy Act 1967 - Paragraph 3(1)(i) and 3(2)(ii) - Appeal against a Bankruptcy Notice - The core issue was whether a judgment relied upon for a bankruptcy notice is a final judgment. The court determined that despite ongoing appeals, the judgment in question is final under the Act. (Paras 24, 30, 37)
(B) Final Judgment - Determination of what constitutes a final judgment in the context of bankruptcy proceedings, clarifying that a judgment is considered final even if subject to an appeal, provided it has not been set aside. (Paras 31, 37)
Facts of the case:
The Appellant contended the Bankruptcy Notice was invalid as the underlying judgment amounted was disputable due to a pending appeal, asserting rights under previous case law. The Respondent argued the notice was valid under the law.
Findings of Court:
The learned Registrar's decision on the validity of the Bankruptcy Notice was upheld, confirming that the Appellant was in an act of bankruptcy.
Issues: Whether the order dated 29 July 2013 is a final one for the purposes of initiating bankruptcy proceedings.
Ratio Decidendi: The court affirmed that an appeal does not render a judgment non-final, thus validating the Bankruptcy Notice, noting that failure to comply with the terms constitutes an act of bankruptcy.
Result: Appeal dismissed.
| Table of Content |
|---|
| 1. appeal against dismissal of bankruptcy notice. (Para 1 , 2 , 3 , 4 , 5 , 6) |
| 2. arguments regarding disputable judgment debt. (Para 7 , 8 , 9 , 10 , 11 , 12 , 13 , 14) |
| 3. respondent's justification for bankruptcy proceedings. (Para 15 , 16 , 17 , 18 , 19 , 20 , 21 , 22) |
| 4. court observations on the relevance of the issues. (Para 23 , 24 , 25 , 26 , 27 , 28) |
[1] This is an appeal against the decision of the Senior Assistant Registrar in dismissing the Summons-in-Chambers (Enclosure 4) dated 12 January 2014 with costs.
[2] Enclosure 4 was filed by the Appellant to oppose the Bankruptcy Notice (Enclosure 1). Together with the filing of the said Enclosure 4, the Respondent had also filed in a Notice to Oppose the Bankruptcy Notice (Enclosure 3).
[3] The Bankruptcy Notice was filed on 19 October 2013 (Enclosure 1) based on a judgment of the Penang High Court dated 29 July 2013 obtained by the Respondent against the Appellant vide Civil Suit No 22-162-2008. I now reproduce the relevant terms of the judgment given by the Court as follows:-
"... MAKA ADALAH DIHAKIMI seperti berikut:-
a) Defendan hendaklah membayar kepada Plaintif jumlah wang sebanyak RM 1,041,219.14;
b) Defendan hendaklah membayar kepada Plaintif faedah sebanyak 4% setahun keatas jumlah RM 1,041,219.14 dari tarikh penghakiman (29 July 2013) sehingga tarikh penyelesaian penuh; dan
c) Kos sebanyak RM 30,000.00 dibayar oleh Defendan kepada Plaintif..."
[4] The Bankruptcy Notice was personally served on the Appellant on 06 January 2014. Six days after the said service, the Respondent then filed in Enclosures 3 and 4 on 12 January 2014 to oppose the said Bankruptcy Notice.
[5] It is to be noted that the said Notice to Oppose the Bankruptcy Notice (Enclosure 3) was filed pursuant to r 95 Of the Bankruptcy Rules 1969 PU(A) 199/69 and the said Summons-In-Chambers (Enclosure 4) was filed pursuant to r 18 of the said rules.
[6] After deliberating on both of the Enclosures and hearing the submissions submitted by respective parties, the Senior Assistant Registrar disallowed the said application on 19 March 2014. Hence, this appeal before me.
Submission
[7] The submissions submitted by each parties are summarised as follows.
[8] In his application, the only ground of which the Appellant heavily relies upon to invalidate the said Bankruptcy Notice was that the amount claimed in the Bankruptcy Notice is disputable, inconsistent and not a conclusive one.
[9] It was pleaded at para 9 of his Affidavit in Support of Enclosure 4 (Enclosure 5) that he is currently appealing against the whole of the decision of the Learned High Court Judge in the Civil Suit No 22-162-2008.
[10] He also pleads at para 7 of his Affidavit in Support of Enclosure 4 (Enclosure 5) that there is a cross-appeal by the Respondent on the interest of the said Civil Suit No 22-162-2008.
[11] He then refers to the case of Solid Kitchen Sdn Bhd v. Regal Development Sdn Bhd , and submits that as per the above case, the amount of the judgment debt is disputed due to a cross-appeal filed by the Respondent. Therefore, the Appellant submitted that the Respondent should have waited until the appeal is disposed by the Appellate Court before initiating any bankruptcy proceedings against the Appellant.
[12] The Appellant then refers to the case of Low Mun v. Chung Khiaw Bank Ltd , [1988] 1 MLJ 263 ; as per the following:-
"...the debtor is entitled to know from the bankruptcy notice exactly what is being claimed to be due on the whole judgment debt and payable by him within the seven-day period..."
[13] Therefore, based on the above proposition, the Appellant submits that he has every right to know the exact amount of the judgment debt in the Bankruptcy Notice. Since there is no finality of the said order dated 19 July 2013, the said judgment debt has yet to be ascertained.
[14] He also submits that as the amount claimed in the said Bankruptcy Notice has no finality, the Bankruptcy Notice is invalid and therefore must be set a
