Mahadev Shankar JCA:

Judgment 1

[1] This is an appeal against an order to wind-up the appellant (the company). The company's application in the High Court for a stay of the winding-up proceedings was refused. The appeal was initially listed for hearing on 30 August 1997.

[2] In the High Court M/s Azhar & Wong filed a notice of intention to appear on petition on behalf of 98 "creditors" whose children were then studying in the Fairview Schools, and another such notice on behalf of 57 persons who were contributories each holding 50 shares in the company. Mr Davidson was instructed to represent them as counsel. They (the opposing contributories and creditors) opposed the petition. So did the company. There was no conflict of interest.

[3] The petitioners were also contributories of the company. Mr PS Sundram owned no shares in the company. He was the only person who appeared to support the petition. He had earlier filed a civil suit against the company which was still pending.

[4] After being served the appeal record the respondents filed a motion praying for an order that:

(i) the appeal be struck out on the ground that the persons who had brought it had no locus standi;

(ii) alternatively that the directors of the company pay into Court RM50,000 by way of deposit as security for costs and expenses incidental to this appeal;

(iii) that the costs of this application be paid by the respondents in any event.

[5] These respondents who were the petitioners in the Court below are hereafter referred to as "the petitioners".

[6] Another motion was filed by one Pargash Singh and Chee Soo Teng (the proposed interveners) praying that they be permitted to intervene in this appeal. At all material times, the children of the proposed interveners had been pupils in the schools, and both of them were contributories of the company in the sense that each held 50 shares in the company. Their names were not included in either of the lists of persons intending to appear in the High Court. Pargash Singh and Chee Soo Teng claimed in this appeal that they would be representing the interests of the opposing contributories and creditors.

[7] On 3 July 1997 Chian Ngook For filed an affidavit exhibiting the resolution of the board of directors made on 10 December 1996 that the company do prosecute this appeal and Azman Davidson & Co be appointed to act for the company.

[8] The appeal eventually came up for disposal on 6 October 1997. We heard the motion to intervene first. Raja Aziz, as counsel for the proposed intervener referred us to s 289 of the Companies Act 1965 (the Act) which encourages the Court to have regard to the wishes of the creditors and contributories "as to all matters relating to a winding-up". He also referred to Wei Giap Construction Co (Ptd) Ltd v. Intraco Ltd, [1979] 2 MLJ 4 @ p 6 where D'Cotta J dealt with s 289 of the Singapore Act and referred to Palmer's Company Law (Twentieth Edn) at p 701. Infraco obtained the order to windup because Wei Giap was unable to pay its debt. Some of the creditors opposing the petition had filed affidavits in the High Court claiming that if Wei Giap was allowed to continue to operate, their chances of recovery would be greater. These creditors had not filed any independent appeal. The only named appellant on record against the winding-up order was Wei Giap, and the opposing creditors were not separately represented in the appeal. The issues before us are not the same.

[9] Raja Aziz said that in addition to the proposed interveners he also represented the opposing contributories and creditors, on whose behalf a submission had been made to the trial judge by Mr Davidson. He further stated that since there was no set procedure as to how creditors or contributories could inject themselves into the appeal the application was being made ex abundanti cautela.

[10] Encik Yusuf Khan's first submission was that as there was nothing in the Companies (Winding-up) Rules 1972, (the Winding-up Rules) permitting interven