The determination of a liquidator's remuneration must be based on fairness and reasonableness, not merely the majority consent of the Committee of Inspection.

Introduction

[1] Dissatisfied with the Committee of Inspection's (COI) resolution passed through a meeting held via WhatsApp meeting chatgroup messages to allow a remuneration amounting to RM9,296,304.00 to be paid to the liquidator on 18 January 2021, Emiprima Sdn Bhd (the appellant) filed a Notice of Motion to the High Court under s 479 of the Companies Act 2016 (CA 2016) for the Court to assess and vary the remuneration of the Liquidator. The High Court dismissed the appellant's Notice of Motion with costs. Aggrieved by the decision, the appellant appealed.

The Background Facts

[2] Wonderful Castle Sdn Bhd (WCSB) was wound up on 14 August 2015 and one Tee Guan Pian was appointed as the Liquidator of WCSB (the Liquidator).

[3] At the time of winding up, there were 11 contributories in WCSB, including the appellant who held a 10% share.

[4] Primarily, the assets of WCSB were 3 parcels of land, as follows:

(a) Land held under GRN 46990, Lot No 1357 and 1359 Mukim Batu, Daerah Kuala Langat, Negeri Selangor measuring about 236,4878 hectares (Lot 1357 & 1359);

(b) Land held under GRN 47648, Lot 480 Mukim Morib, Daerah Kuala Langat, Negeri Selangor, measuring about 100.8677 hectares (Lot 480);

(c) Land held under GRN 47993, Lot 894 and 1360, Mukim Morib, Daerah Kuala Langat, Negeri Selangor, measuring about 7.6915 hectares (Lot 894 & 1360).

Three Parcels Of Land Are Collectively Referred To As "The Said Lands".

[5] On 16 August 2019, the Liquidator had filed Forms of Summons (encl 139) in the Winding Up Court for sanction to distribute the said Lands with the following distributions and orders:

(a) to distribute Lot 480 to the following contributories:

(i) Lim Boon Chuan (15%);

(ii) Ang Boon Kee (5%);

(iii) Ample Scope Sdn Bhd (7.5%); and

(iv) Tan Eng Soi (10%).

Collectively known as "the 37.5% Contributories";

(b) Lot 1357 and Lot 894 be sold and the proceed be distributed to the 37.5% Contributories;

(c) RM2.5 million be given to the Liquidator as remuneration;

(d) RM3,050,000.00 be paid as costs to the 37.5% Contributories; and

(e) The Liquidator be exonerated from any further claims by all contributories and creditors of WCSB.

[6] The proposed distribution terms in encl 139 were accepted by almost all of the contributories, except for the appellant who had strongly opposed it. After considering all parties' submissions, the learned High Court Judge (the LHCJ) on 22 January 2020 dismissed encl 139 and inter alia, held that there was nothing to substantiate RM2.5 million as the remuneration of the Liquidator. It was further held that the proposed settlement terms, which gave preferential treatment to the 37.5% contributories, contravened the pari passu principle.

[7] Thereafter, a public tender was conducted by the Liquidator to sell off the said Lands. Perkasa Temenggong Sdn Bhd turned out to be the highest bidder with bidding price of RM126,000,000.00. Total realisation of WCSB's assets including the bidding price of the said Lands were RM148,213,574.72.

[8] Then, the Liquidator issued a Notice of Meeting dated 24 December 2020, giving notice to hold a Creditors and Contributories Meeting on 15 January 2021. The agendas proposed by the Liquidator, among others, include an agenda to approve the remuneration of the Liquidator.

[9] Two days before the scheduled meeting, the Liquidator issued a notice on 13 January 2021, postponing the meeting due to the imple