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1998 MarsdenLR 605

HIGH COURT MALAYA, KUALA LUMPUR

ABDUL AZIZ MOHAMAD J


SHING HUP HIN CONSTRUCTION SDN BHD
versus
GENERAL SOIL ENGINEERING SDN BHD

COMPANIES WINDING-UP NO: D2-28-345-1998

Decided On : 11-23-98

JUDGMENT

Abdul Aziz Mohamad J:

The respondent company against whom the present winding-up petition is brought is seeking a stay of the hearing of the petition until the trial of a civil suit brought by the respondent company against the petitioner company. The respondent company relies on s. 222 of the Companies Act 1965. Learned counsel for the petitioner company has raised a preliminary question to be answered, namely, whether s. 222 empowers the court to order a stay of the present winding-up petition. Authorities have been cited on both sides, but I think the question can be answered simply on a proper analysis of the manner in which s. 222 is constructed. It says as follows:

At any time after the presentation of a winding up petition and before a winding up order has been made, the company or any creditor or contributory may, where any action or proceeding against the company is pending, apply to the court to stay or restrain further proceedings in the action or proceeding, and the court may stay or restrain the proceedings accordingly on such terms as it thinks fit.

The making of an application under s. 222, as represented by the words "may ... apply", is to be done "At any time after the presentation of a winding up petition and before a winding up order has been made", that is to say, during the pendency of the winding-up petition in question, which in this case is the present winding-up petition. That is the time factor. The event or case that gives rise to the need to apply is "where any action or proceeding against the company is pending", the "company" there being the company that is sought to be wound up, which in this case is the respondent company. That case or event must, of necessity, also be existing during the time factor, that is to say, during the pendency of the winding-up petition in question. Coupling the time factor with the case or event, we have a situation where, during the pendency of the winding-up petition in question, there is pending - that is to say, by necessity of logic, also pending - an action or proceeding against the company that is sought to be wound up. The action or proceeding that is also pending must be other than the winding-up petition in question, although it may be some other winding-up petition. Now what may be applied for and ordered under s. 222 is a stay of further proceedings in the action or proceeding that is also pending, not further proceedings in the winding-up petition in question, which in this case is the present winding-up petition.

The result is as if the word "other" had been added to the phrase "action or proceeding" in s. 222, but that word has not been included because, I think, the intention of s. 222 is so clear from the way it is constructed that it would have been unprofessional to attempt to enhance the clarity by adding the word.

The English s. 226 was referred to in submission. It is as follows:

226.

At any time after the presentation of a winding-up petition, and before a winding-up order has been made, the company, or any creditor or contributory, may -

(a) where any action or proceeding against the company is pending in the High Court or Court of Appeal in England or Northern Ireland, apply to the court in which the action or proceeding is pending for a stay of proceedings therein; and

(b) where any other action or proceeding is pending against the company, apply to the court having jurisdiction to wind up the company to restrain further proceedings in the action or proceeding;

and the court to which application is so made may, as the case may be, stay or restrain the proceedings accordingly on such terms as it thinks fit.

It is to be noted that the event or case of an action or proceeding being pending against the company is, unlike in our s. 222, provided in two paras (a) and (b) because the application is to be made in different courts, depending on whether the action or proceeding falls under para. (a) or (b). Just as in our s. 222, the

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