Abdul Hamid Mohamad FCJ:

[1] The respondents herein had filed a winding up petition in the High Court to wind up Tan Chong Consolidated Sdn. Bhd. ("TCC"), the ninth appellant on the just and equitable grounds. The appellants herein are the respondents in the petition. The appellants then filed a notice of motion in that petition for an order to restrain the legal firm of Shearn Delamore & Co ("Shearn") from acting for the petitioners/respondents.

[2] The grounds forwarded by the appellants to disqualify the respondents from retaining Shearn are that Shearn had over the years acted as common solicitors for the appellants and the respondents. In the course of so acting, Shearn had advised on at least three corporate exercises involving reductions and restructuring of capital in which Shearn had prepared affidavits and company returns stating the respective shareholdings of the parties in TCC. From 1998 to 2000, Shearn was advising as common solicitors for the parties including TCC in respect of a de-merger exercise for Tan Chong Motor Holdings Bhd. ("TCMH") in which TCC had approximately 44% of the shares. Shearn was also the common solicitor at the time of the Emergency General Meeting on 11 September 1999 when the shareholders of TCC voted to approve TCC's participation in the de-merger exercise.

[3] The High Court dismissed the application. The appeal to the Court of Appeal was also dismissed. On 17 May 2005, this court granted leave to appeal on the following question:

What is the proper test to be applied in determining whether a firm of solicitors should be disqualified from representing parties in subsequent litigation.

[4] Before us, Dato' Cecil Abraham, learned counsel for the respondents raised a preliminary objection. His objection was that the appeal, as it is now, is not based on a cause or matter raised in the Court of Appeal or in the High Court. He argued that the appellants' case in the High Court and in the Court of Appeal was that:

(a) Shearn was in possession of confidential information

(b) the applicable legal principles are as set out in Prince Jefri Bolkiah v. KPMG (a firm) [1999] 1 All ER 517.

(c) Shearn should therefore be restrained from acting for the respondents/petitioners in the winding up petition.

[5] As a result the High Court had made a finding of fact that Shearn was not in possession of any confidential information. The judgment of the High Court reads:

I am satisfied that the Firm is not in possession of any information, confidential or otherwise, as alleged by the respondents, which the Firm is capable of using against the respondents (the Appellants herein - my addition) in this petition. The respondents' only complaint is that the Firm's corporate department had previously advised TCC in certain corporate matters and in its participation of the de-merger exercise of TCMH, I am of the view that the respondents' assumptions of any conflict of interest and confidentiality are seriously misconceived. These allegations are far-fetched and have been credibly responded to by the petitioners. The partners of the corporate department in the Firm have confirmed that during their retainer by TCC, neither the petitioners nor the respondents had confided information, confidential or otherwise, to the Firm which are relevant or material to this petition. Their scope of advice to TCC was confined to the company only and not to the individual shareholders.

It is specifically noted that the Firm is not privy to information of the respondents or their personal business affairs, which are relevant or material to this petition or which can be used against the respondents in this litigation. More importantly, there is no evidence in support of the respondents' bare allegation that the Firm may be in possession of confidential information which can be used against them in this petition. I am of the view that the Court cannot and will not grant an injunction based on bare allegations or assumptions of t