Directors hold an absolute right to inspect company records under the Companies Act 2016, which cannot be impeded without clear proof of improper purpose.

[28] The Company Defendants referred the Court to s 213(1) of the Companies Act 2016 which provides:

"213. (1) A director of a company shall at all times exercise his powers in accordance with this Act, for a proper purpose and in good faith in the best interest of the company."

[29] In support of their submissions, the Company Defendants referred the Court to the case of Dato' Tan Kim Hor v. Tan Chong Consolidated Sdn Bhd (supra) for the proposition that a director's right to inspect records of a company cannot be exercised for an improper purpose and the inspection would be detrimental to the interests of the Company Defendants.

[30] The Company Defendants also referred the Court to the case of Kwan Teck Hian v. Insuflex Corporation Sdn Bhd , 2017 MarsdenLR 1105 (High Court) which followed Dato' Tan Kim Hor for the proposition that a director's right to inspect a company's books and records is absolute but can be forfeited if exercised for an improper purpose.

[31] The Individual Defendants argued that the Plaintiffs' application for inspection of the companies' records is motivated by an ulterior motive to advance their personal cause in Suit 112, which is unrelated to the 1st Plaintiff's duties as a director or member of the companies. It is submitted that the right of inspection granted to directors is concomitant with their fiduciary duties to act in the best interests of the company, and it must not be used for personal gain. In addition to Dato' Tan Kim Hor the Individual Defendants also cite The State of South Australia And Anor v. Barrett And Ors [1995] 180 LSJS 171 (Supreme Court of South Australia) to support their argument that the right of inspection must be exercised for the benefit of the company and not for personal reasons.

[32] The Individual Defendants also point out that the Plaintiffs' vague and imprecise allegations in Suit 112 about the shares held under an express trust raise serious questions about the true proponent of the litigation, which they suggest to be the 2nd Plaintiff. The Individual Defendants argue that the Plaintiffs' application for inspection is intended to fish for evidence to patch up the imprecise and vague allegations in their Statement of Claim in Suit 112. It is further argued that the Plaintiffs' application is intended to circumvent the usual pre-trial directions in Suit 112 and the criteria of relevance and materiality in applications for discovery and inspection under O 24 Rules of 2012.

[33] The Individual Defendants contended that the Plaintiffs' application for inspection is an excuse to achieve outcomes that they cannot achieve in Suit 112, and it is not made in good faith. They cite the case of Low Ean Nee v. SNE Marketing Sdn Bhd , [2022] 4 AMR 843 to support their argument that the Court should not allow an order for inspection to be used for an ulterior purpose.

[34] The Individual Defendants argued that the Plaintiffs have not demonstrated that their application for inspection is related to their duties as directors or members of the companies. They also point out that the 2nd Plaintiff, who is not a director or member, has no locus to advance a claim here or in Suit 112.

[35] I do not accept the contentions and submissions of the Company Defendants and Individual Defendants above.

[36] Upon examining the affidavits filed by the Company Defendants, the Court finds that the Company Defendants have failed to discharge their burden to show that the inspection of documents by the 1 st Plaintiff was for an ulterior motive and would cause harm to the companies. The Company Defendants have not provided any specific allegations to support their claim of ulterior motive, and the events they have alluded to ie the 1st Plaintiff's authorising a third party other than himself to attend to the inspection on short notice, the 1st Plaintiff's failing to attend the relevant board of directors' meetings of the 2nd to 6th Defendants and the 1st Plaintiff's solicitor making unreasonable th