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2018 MarsdenLR 3994
HIGH COURT MALAYA KUALA LUMPUR
KLASS CORPORATION (M) SDN BHD – Appellant
Versus
MKRS MANAGEMENT SDN BHD – Respondent
[Originating Summons No: WA-24NCC-472-11-2017]
A plaintiff cannot seek a Fortuna injunction against a winding-up petition when there is a valid, enforceable judgment debt unless a bona fide dispute exists over the debt.
Headnote:The judgment addresses an application for an injunction made by the plaintiff to prevent the defendant from filing a winding-up petition as provided under Section 465 of the Companies Act 2016. The court found that the plaintiff failed to demonstrate a bona fide dispute of the debt given that there is a valid judgment against it. The court examined the principles governing Fortuna injunctions and concluded that without a genuine dispute, the application for injunction was dismissed. The court established the criteria under which Fortuna injunctions may be granted, specifically when a petition is deemed to lack success, and noted that claims of irreparable damage do not alter the enforceability of a judgment debt. In conclusion, the plaintiff's application was rejected.
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| 1. application for injunction to restrain winding-up petition. (Para 1 , 2 , 3 , 4 , 5 , 6) |
[1] This is an application for an injunction filed by the plaintiff to restrain the defendant from presenting a winding-up petition under s 465 of the Companies Act 2016 against the plaintiff. At the conclusion of the hearing, I refused the application and highlighted the main reasons for the dismissal. These are the full reasons for my decision, which reiterates the principles governing applications of Fortuna injunctions under the new .
Key Background Facts
[2] The plaintiff is involved in the construction business, and is the subcontractor for a certain work package in respect of the project for the Mass Rapid Transit ("MRT") in the Klang Valley. The defendant is in the business of supplying products and services related to scaffolding, manpower and safety consultancies in the construction and engineering sectors.
[3] The parties had entered into a contractual relationship that subsequently turned litigious which saw the defendant instituting a claim against the plaintiff on 28 April 2015, for what the former pleaded was a breach of contract, and thus sued for an alleged outstanding amounts from the plaintiff (Suit No: B52C-6-04-2015).
[4] The plaintiff contested the claim, and a trial then ensued, which took place for 27 days, over a period of two years, where 14 witnesses testified. On 10 October 2017, the Kuala Lumpur Sessions Court allowed the defendant's claim against the plaintiff and ordered that the plaintiff must pay the defendant the following:
(i) Principal amount of RM715,381.79;
(ii) Contractual interest on overdue sum up to 9 October 2017 amounting to RM340,248.49;
(iii) Disbursements totalling RM19,670.85;
(iv) Costs in the sum of RM30,000; and
(v) Post judgment interest on (i) and (ii) above at the rate of 5% per annum from 10 October 2017 till full settlement (collectively, "the Judgment Debt").
[5] Dissatisfied, the plaintiff on 12 October 2017 filed a notice of appeal to the High Court (Rayuan Sivil No: WA-12BC-22-10-2017) against the decision of the Sessions Court.
[6] The defendant however, on 19 October 2017 served a notice of statutory demand issued under s 465(1)(e) and (h), and s 466(1)(a) of the Companies Act 2016 ("the CA ") and demanded payment of the total sum of RM1,117,804.88, being the total sum due under the Judgment Debt within the requisite 21 days.
