2013 MarsdenLR 2486

HIGH COURT MALAYA KUALA LUMPUR
BEST RE (L) LTD – Appellant
Versus
HANWHA GENERAL INSURANCE CO LTD – Respondent
[Originating Summons No: 24NCC-411-11 Of 2012]

A party claiming an injunction to restrain a winding-up petition must prove that the debt is bona fide disputed on substantial grounds, not merely presenting a serious question.

Headnote:(A) Companies Act 1965 - Section 218 - Winding up petition - Plaintiff sought an injunction to prevent the defendant from presenting a winding up petition based on a disputed debt of USD6,519,874.08 - The plaintiff claimed the debt was bona fide disputed on substantial grounds. (Paras 1-2, 10, 37)

(B) Fortuna Injunction - The principles for granting an injunction to restrain a winding up petition require the debt to be bona fide disputed on substantial grounds, not merely a serious question to be tried. (Paras 18-19)

(C) Burden of Proof - The burden is on the plaintiff to prove the dispute is bona fide and substantial, relying on clear evidence. (Paras 20-26)

(D) Admissions - Plaintiff’s documented admissions of the debt undermine its claim of a bona fide dispute, as established in prior correspondence and agreements. (Paras 21, 24-34) (E) Foreign Law - Expert opinion on Korean law indicates that any dispute over the debt lacks substantial grounds and unlikely to succeed in court. (Paras 28-36)

Findings of Court:
The plaintiff’s claims about the status of the debt were deemed contrived and, based on established evidence, it was clear the debt was acknowledged.

Issues: The court primarily examined whether the plaintiff could substantiate its claim of a bona fide dispute regarding the September installment.

Ratio Decidendi: The court ruled that the plaintiff failed to demonstrate a bona fide dispute over the installment. Consequently, the defendant was entitled to present the winding up petition.

Result: Application dismissed with costs.