Chong Siew Fai CJ (Sabah & Sarawak):

[1] At the conclusion of the hearing, we allowed the appeal of the plaintiff with costs here and below, and granted, subject to the usual undertaking as to damages, an injunction restraining the 1st defendant, First Profile (M) Sdn Bhd ('the holding company') through its directors, officers, servants, agents or otherwise howsoever from disposing of or otherwise dealing in any manner whatsoever with any of the four parcels of land described below until judgment in the action or until further order. We now give our reasons.

[2] The 2nd respondent-company ('2nd defendant') in this appeal, Saga Prestige Sdn Bhd ('the subsidiary') was a wholly-owned subsidiary of the holding company and had a paid-up capital of RM2,720,016 made up of 2,720,016 shares of RM1 each. The subsidiary owned four pieces of land held under GM 18 Lot 1881, GM 19 Lot 1882, GM 110 Lot 1891 and GM 111 Lot 1892, all in Mukim Batu, Wilayah Persekutuan.

[3] By an agreement dated 16 October 1991 ('the agreement') made between the appellant and the holding company, the holding company agreed to sell to the appellant all the paid-up shares of the subsidiary for RM6,193,000. A sum of RM100 was paid as deposit and part payment of the purchase price.

[4] Section 1.04 of the agreement stated that the holding company intended to build schools on the said lands and towards that end was to submit an application to Dewan Bandaraya Kuala Lumpur ('DBKL') for a development order for the building, construction and erection of the said schools within three months from 16 October 1991, ie the date of the agreement. The three-month period would be up to 16 January 1992; and there is uncontroverted evidence that the application was submitted on 16 January 1992.

[5] The parties to the agreement further agreed under s 4.01 thereof that the agreement is conditional upon the development order not being obtained within 15 months from the date of its application (16 January 1992). The 15 months would be up to 16 April 1993 (the cut-off date). There is unchallenged evidence that no development order was obtained by 16 April 1993. This meant that the conditional agreement had become unconditional.

[6] However, on 13 April 1993, ie three days before the cut-off date, the holding company, by a letter of the same date returned the deposit and part payment to the appellant and purported to terminate the agreement, but putting it in a rather roundabout way stating, "We hereby write to inform you that we herewith release you from the aforesaid obligation."

[7] Dissatisfied with the turn of events, the appellant filed an action on 30 June 1993 claiming inter alia, for a declaration that the holding company had committed anticipatory breach of the agreement, for specific performance and an injunction restraining the holding company from disposing of the shares of the subsidiary.

[8] The appellant also applied for an interlocutory injunction to restrain the holding company from disposing of or otherwise dealing in any manner whatsoever with any of the four pieces of land registered in the name of the subsidiary. The application was supported by three affidavits while the holding company did not file any.

[9] It should, perhaps, be pointed out that initially the appellant brought the action against the holding company only. The application for interlocutory injunction was also directed only against the holding company. Subsequently, the appellant had the subsidiary added as the 2nd defendant to the action but without amending the prayer for the interlocutory injunction to include or restrain the subsidiary.

[10] The learned trial Judge refused the appellant's application for interlocutory injunction with costs, holding that the holding company, being shareholder of the subsidiary had no right to dispose of or deal with the lands of the latter, that the injunction, even if granted, would not prevent the subsidiary from selling off the said lands, and that there was n