Gill CJ (Malaya):

This is an appeal from the dismissal by BTH Lee J of the appellant's application by way of originating motion in which, in his capacity as a member of the first respondent company, he asked for a series of orders the gist of which was that the second and third respondents be removed from office as the managing director and director respectively of the company and a receiver and manager be appointed to conduct the business and investigate the affairs of the company, that they do pay to the company various sums of money which they had taken or paid out from the company's funds wrongfully or without proper authorisation or for unauthorised purposes, and that in the alternative the company be wound up.

As one of the grounds on which the application was opposed was that it was made by the appellant maliciously because of family disputes prior to the formation of the company, it will be useful to refer briefly to such disputes as a historical background of these proceedings.

The parties to the proceedings are the sons of the late Ling Chui Ming who died in 1955 leaving six sons whose names in order of seniority are Ling Beng Siew (the second respondent), Beng Tuang, Beng Siong (the third respondent), Beng Sung (the appellant), Beng Hui and Beng King. During his lifetime the father made each of his sons a partner in the two family partnership firms known as Kong Thai (MK) Sawmill, Sibu and Ban Hin Sawmill Mukah. After his death letters of administration of his estate were granted to Beng Siew and Beng Siong who also carried on the family partnership businesses.

The first family dispute arose about the year 1958 when the younger brothers asked Beng Siew for accounts of the administration of their father's estate and were met with the answer that the accounts had been destroyed in accordance with the father's business practice. This dispute was settled without resort to the Court.

The second dispute arose in 1962 when the three younger brothers asked for accounts of the partnership business and were told that they had been lost in a flood. As a result of this dispute the three elder brothers brought an action against the three younger brothers in the High Court at Sibu for a dissolution of the partnerships and distribution of the assets. The action was defended but was ultimately disposed of by the Court making an order in the terms of a settlement as prepared by the parties through their solicitors.

The result of the settlement was that the elder brothers purchased the younger brothers' interest in Kong Thai (MK) Sawmill Sibu by transferring to the younger brothers their interests in Ban Hin Sawmill Mukah as part of the purchase price and paying the balance of the purchase price in cash amounting to over two million dollars. Thus Ban Hin Sawmill Mukah became the property of the three younger brothers and was incorporated in December 1962 as Mukah Sawmills (1962) Sendirian Berhad. Kong Thai (MK) Sawmill was eventually incorporated under the name of Kong Thai (1963) Sendirian Berhad. This company was entirely different from Kong Thai Sawmills (Miri) Sendirian Berhad, the first respondent company, with which we are concerned in these proceedings.

Kong Thai Sawmills (Miri) Sendirian Berhad (hereinafter referred to as "the company" or "KTS") was formed by the three elder brothers Beng Siew, Beng Tuang and Beng Siong, each of whom was named a director in the Articles of Association of the company. The company was incorporated in Sarawak on 29 June 1964 with an authorised capital of three million dollars divided into 30,000 shares of $100 each. At the first formal meeting of the company held on 16 January 1965, the first 10,000 shares representing a capital of one million dollars were issued. Beng Siew, Beng Tuang and Beng Siong were allotted 7,150, 1,000 and 500 shares respectively. In 1966, a further 3,600 shares were issued so as to increase the paid-up capital of the company to $1,360,000.

On 1 April 196