The necessity for evidence showing a real risk of dissipation of assets is crucial for granting a Mareva injunction.

Darryl Goon Siew Chye JCA:

Introduction

[1] This was a case that concerned disputing family members in a corporate setting. The central issue in this appeal was whether an interlocutory Mareva form of injunction should have been granted against the appellants by the High Court.

[2] The originating process in this appeal was an Originating Summons taken out by the respondent, as plaintiff, against the appellants, who were the 1st and 2nd defendants.

[3] By this Originating Summons, the respondent invoked ss 345, 346 and 351 of the Companies Act 2016 and O 88 r 2 of the Rules of 2012. Thus, the Originating Summons was one founded upon the provisions of the Companies Act of 2016 for remedies in respect of oppression. The company central to the case was Kien Yiap Trading Sdn Bhd ('Company'), which was cited as the3rd defendant in the Originating Summons.

The Injunctions

[4] On 21 February 2019, the respondent secured an ex parte interim Mareva injunction against the appellants. On 6 March 2019, an ad interim Mareva injunction appeared to have been granted against the appellants upon the terms of the earlier granted ex parte injunction, effective from 13 March 2019. That this appears so is because this order, dated 6 March 2019 was, unfortunately, unhappily worded thus, 'IT IS HEREBY ORDERED that the ad interim is extended from 13 March 2019 until the disposal of the inter-partes application'. As worded, the order suggests that there was a prior ad interim order granted and which was being extended. However, be that as it may, it would have been clear enough, certainly to the parties involved, that the order of 6 March 2019 was actually the grant of an ad interim order pending the inter partes hearing of the application for an interlocutory Mareva injunction until the disposal of the Originating Summons.

[5] In addition, and also on 6 March 2019, the ad interim Mareva injunction granted contained a variation that allowed for certain payments to be made by the appellants. The material part of this variation order of 6 March2019 states as follows:

"1. The Order dated 21 February 2019 be varied to allow the following payments to be made by the 1st and 2nd defendants' ("4 Payments"):

1.1 RM4,767.00 to Public Bank Bhd being instalment for shop house Lot No 32, Kimanis Centro, Kimanis Papar, Sabah;

1.2 RM25,000.00 for CP204 Company Income Tax Instalment 2019;

1.3 RM6,021.00 to Public Bank Bhd being instalment for KobelcoS200XDL-10 with registration no JSM 762; and

1.4 RM7,995.00 to Public Bank Bhd being instalment for Mercedes BenzS400 with registration no JDL 8.

2. The 1st and 2nd defendants shall make theb 4 Payments directly to the said creditors."

[6] Why this variation was required is unclear. There was no outright restriction against the appellants from disposing any of their assets as such. Whether the variation was meant to permit the appellants to utilise their monies and assets, including those from the identified accounts, for the specified payments even if it would deplete their assets and monies below the limit stipulated in the order of 21 February 2019 ie RM3,412,829.41, is unclear.

[7] On 15 September 2020, the inter partes application for the Mareva injunction was finally heard and an interlocutory Mareva injunction in terms of the ad interim Mareva injunction was granted by the High Court against the appellants.

[8] The material parts of the Mareva injunction granted were the following:

"1. The 1st and 2nd defendants be prohibited from removing from Malaysia in any way, dispose of or deal with or diminish the value of any of their assets which are in Malaysia whether in their own name(s) or not and whether solely or jointly owned up to the value of RM3,412,829.41 (" Mareva Sum").

1.1 This prohibition includes any real properties and any credit balance or monies as may or may thereafter be held at any financial institutions, including but not limited to the following bank accounts:

i. OCBC Account No: 7152544566; and

ii. UOB Accou