Introduction

This is an application by Builtcon and Development Sdn Bhd ("1st Defendant") and Lee Hon Khiong ("2nd Defendant") to set aside the writ or stay the action and to set aside the ex parte injunction that was obtained against the 2nd Defendant on 25 August 1998 by CBM Construction Sdn Bhd ("the Plaintiff"). The Plaintiff and the 1st Defendant are both companies incorporated in Negara Brunei Darussalam. The 2nd Defendant is the managing director and shareholder of the 1st Defendant.

The allegations

The statement of claim asserted that the Plaintiff and the 1st Defendant entered into a contract in Negara Brunei Darussalam on 5 November 1996 for the construction by the Plaintiff for the 1st Defendant of 25 houses for a consideration of B$3,986,211.00 and that a sum of B$1,320,746.84 is alleged to be still due. As against the 2nd Defendant, the Plaintiff asserted that he, after lifting the corporate veil, should be liable because he was the alter ego of the 1st Defendant and had fraudulently and illegally dissipated or siphoned out B$729,000.00 belonging to the 1st Defendant for his personal use through the assistance of Chieng Bong Ming, the managing director of the Plaintiff. This was achieved by the Plaintiff, at the request of the 2nd Defendant, submitting another but higher tender for the construction of the said houses for the sum of B$3,986,211.00 after it had earlier submitted a lower tender of B$3,257,211.00. The difference between the two sums, that is RM729,000.00, was paid to the 2nd Defendant by two instalments in September and November 1997. More of the allegations will be adverted to when the issues are considered.

Ex-Parte Injunction

On 25 August 1998 I granted a Mareva injunction but not in the full terms that were prayed for. I did not allow the prayer that the banks disclose to the Plaintiff's advocates the details of the 2nd Defendant's accounts so as to limit the damage that may be done by an ex parte order on a party affected by it as I entertained some doubts regarding the conduct of the Plaintiff, acting through its managing director Chieng Bong Ming. Assuming for the moment the allegations of the Plaintiff are true, it is without question a fraudulent conduct on the part of the Plaintiff acting through Cheing Bong Ming to cause the 1st Defendant to pay more than what it was originally required to do and for the Plaintiff to facilitate that machination by allowing the sum of B$729,000.00 to be paid to the 2nd Defendant personally which otherwise would have been paid to the 1st Defendant. It was upon this fraud that the Plaintiff sought redress against the 2nd Defendant. In my view this is a clear case of a plaintiff coming to court with unclean hands. The Plaintiff had no qualms in agreeing to defraud the 1st Defendant and the Plaintiff even has the audacity to proffer the excuse of wanting the contract badly as justification for their agreement to the fraudulent scheme. In this regard, though it can be said that the other shareholder (other than the 2nd Defendant) would eventually be defrauded, it is more accurate to state that it was the 1st Defendant who was defrauded of the money. The Plaintiff is now asking the Court for assistance in the form of Mareva injunction which necessity arose out of the very fraud which the Plaintiff participated and reveled in and which resulted in the diversion of the money to the 2nd Defendant which otherwise should have gone to the 1st Defendant and which money the Plaintiff is now attempting to get their hands on. Injunction being an equitable relief, the Plaintiff must come to court with clean hands; they did not do so. This principle was applied lately in Ang Hiok Seng @ Ang Yeok Seng v Yim Yut Kiu [1997] 2 MLJ 45 FC. This reason alone was sufficient for me to set aside the injunction on 12 January 1999.

Cause of action against the 2nd Defendant

Another reason for discharging the injunction is that the Plaintiff has no cause of action against t