GROUNDS OF JUDGMENT

The plaintiff was awarded subcontract works by Taylor Woodrow Projects (M) Sdn. Berhad pursuant to a letter dated 8 May 1986. The works were in relation to Star Light Rail Transit System 1 - Phase II Work Package TWP 02-33-20 Mulia Viaduct, Bifurcation Viaduct and East-West Link Crossing Structural Steelwork Fabrication and Erection. The subcontract works was for a lump sum of RM10,834,534.00. To carry out some of the works the plaintiff engaged the [2] defendant as its subcontractor pursuant to a contract ("the said contract") as evidenced by a letter dated 15 January 1997. The works which were awarded to the defendant under the said contract were for the blasting and painting works of the steel bridges. As regards payment it was agreed that progress claim for payment will be paid within 30 days after month ending receipt of invoice. It was also agreed that in case of dispute Victor Buyck conditions of contract would apply.

It is the defendants's case that it has performed its obligations under the said contract by carrying out the works and therefore it is entitled to payment of the sum stated in the invoices. As the plaintiff had failed to honour its obligations to meet the payment due to the defendant under the invoices the defendant caused to be issued a notice of demand dated 24 July 1997 under section 218 of the Companies Act 1965 against the plaintiff. The notice was served on the plaintiff. By this notice the defendant demanded for payment of the sum of RM398,785.74 being the total amount outstanding under the various invoices as per details following: Invoice Amount Due Date PI/P-0805RM148,303,73 (balance)30.4.97 PI/P-0831RM162,389.4730.5.97 PI/P-0864RM74,042.5430.6.97 PI/P-0768RM 3,250.0030.3.97 PI/P-0806RM 2,800.0030.4.97 PI/P-0830RM 8,000.0030.5.97

[3]

The plaintiff disputes the claim and says that a winding up petition should not be filed. By this originating summon filed on 20 August 1997, the plaintiff is seeking for an injunction to restraint the defendant either by itself or through its agents or employees or representatives from filing, prosecuting, delivering and/or advertising a winding up petition for the winding up of the plaintiff. On the same day the plaintiff also filed an exparte Summons-in-Chambers (Enclosure 3) seeking for the same order as prayed in the Originating Summons. I heard the application on 22 August 1997, on a certificate of urgency and granted the injunction sought for. As the injunction was obtained exparte it is effective only for two weeks and this prompted the plaintiff to file another Summons-in-Chambers (Enclosure 6) on the same day i.e. on 22 August to be heard interpartes. The plaintiff is seeking for a similar injunction as the one granted exparte to restraint the defendant until the hearing and conclusion of this action or any subsequent order. Enclosure 6 was fixed for hearing on 4 September 1997 but was postponed with the consent of both parties to 5 November 1997 to enable the defendant to file an affidavit in reply. On 5 November 1997 I dismissed the application. I now give my reasons. [4]

The grounds for the plaintiff's application are stated in a lenghty affidavit in support affirmed by its director Wim Hoekman. In short the grounds are the debt claimed by the defendant is disputed and it is an abuse of the process of the court to file a petition to wind up the plaintiff based on a disputed debt. The debt is disputed on the grounds that the defendant is not entitled to further payment as the plaintiff has a claim against the defendant for breach of contract and the plaintiff has sufferred losses, costs, expense and damage which the defendant is liable to indemnify and the amount payable far exceeds the amount payable to the defendant.

It is established law that the court has a discretion in an application for injunction to restraint a person claiming to be a creditor of a company from presenting a petition to wind up the company. The court will exerc