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2025 MarsdenLR 5271
HIGH COURT MALAYA PULAU PINANG
TAN KHENG GUAN – Appellant
Versus
CHU KOK KHING & ORS (ENCL 450) – Respondent
[Civil Suit No: PA-22NCVC-223-11/2017]
Contempt of court includes acts obstructing justice, impacting not only direct violators but also those assisting such violations; legal representatives must uphold court orders and advice appropriately.
Headnote:(A) Contempt of Court - Breach of Injunction Order - The plaintiff sought to commit multiple defendants for contempt regarding an injunction to freeze their bank accounts and prevent withdrawals, but the defendants withdrew RM7,049,286.76 in defiance of the order - The court held that the undertaking not to withdraw money is binding and confirmed that both the defendants and their solicitors are guilty of contempt. (Paras 1, 6, 19)
(B) Contempt of Court Essentials - An act or omission interfering with the administration of justice constitutes contempt, affecting not only the parties bound by court orders but also those who assist in disobedience. (Para 9)
Facts of the case:
This matter involved a plaintiff's application to commit defendants for contempt after they violated an injunction to freeze bank accounts, withdrawing substantial amounts despite multiple court orders. (Paras 1-4)
Findings of Court:
The court found clear evidence of contempt, ordering the return of withdrawn funds and imposing penalties on the defendants for disobeying court orders. (Paras 19, 20)
Issues: The key questions were whether the defendants violated the court's injunction and the responsibility of their solicitors in the matter. (Paras 1, 19)
Ratio Decidendi: The court reasoned that the explicit undertaking not to withdraw funds binds the parties; thus, violation constitutes contempt, requiring accountability from both the defendants and their legal representatives. (Paras 8, 19)
Result: The court ordered defendants to return the withdrawn amount and imposed fines on each defendant with potential imprisonment for non-compliance.
Key Points: - The court held that an explicit undertaking not to withdraw funds binds the parties and constitutes contempt when breached. (!) (!) (!) - The court found that solicitors who advised or assisted in disobeying the undertakings and stay orders are liable for contempt and professional responsibility failures. (!) (!) (!) (!) - The court ordered the return of RM7,049,286.76 and imposed imprisonment and fines for the defendants and certain individuals/parties for contempt. (!) (!) (!) - Contempt of Court extends to those who assist or abet disobedience, not only the named parties. (!) (!) - The undertaking remains binding despite later appeals and orders, and the stay/undertaking binds all involved banks and parties. (!) (!) (!) (!) - The Court of Appeal confirmed the binding nature of the undertaking and related orders. (!) - There is clear evidence of substantial withdrawals totaling RM7,049,286.76 despite injunctions and stays. (!) (!) (!)
Question 1?
Question 2?
Question 3?
| Table of Content |
|---|
| 1. application for contempt proceedings. (Para 1 , 2 , 3) |
| 2. defendants' breach despite clear orders. (Para 4 , 7) |
| 3. evidence of contempt from defendants. (Para 6 , 8 , 9 , 10 , 11 , 12 , 13 , 16) |
| 4. duty of counsel to uphold court orders. (Para 14 , 15 , 19) |
| 5. remedies and sanctions imposed. (Para 20 , 21) |
[1] This is the Plaintiff's application at encl 450 for an order to commit the Contemnors i.e D1, D2, D4, D6, D7, D8, D9, D10, D11, D12, (except for the 3rd Defendant), Messrs Ismail, Khoo & Associates, John Khoo Boo Lai and Martin Khoo Ding Yuan. The reliefs sought by the plaintiff for the contempt proceedings are among others:
a. for the sentence of imprisonment against D1, D2, D4, D6, D7, D8, D9, D10, D11, D12 (the defendants), Messrs Ismail, Khoo & Associates, John Khoo Boo Lai, and Martin Khoo Ding Yuan; and
b. to return & refund of RM7,049,286.76 which have been withdrawn and siphoned out by the Contemnors from their bank accounts.
in breach of the numerous court orders and such withdrawal have interfered with due administration of justice.
[2] On 9 January 2024, an Inter-parte Injunction Order dated 9 January 2024 has been granted against all the defendants by this court where all the bank accounts to be frozen and there shall be no withdrawal. Despite the Injunction Order, there were withdrawal of monies by the defendants from the bank accounts. On 29 January 2024, John Khoo, the solicitor for the defendants has given an undertaking by way of consent not to dispose movable and immovable assets of the defendants until disposal of the appeals. Following this the Stay Order was granted on 29 January 2024 subject to the undertaking in the presence of Martin Khoo who was fully aware of the said undertaking. The undertaking given by John Khoo is clear and unambiguous and is binding on both of them.
[3] The court of Appeal (COA) in Civil Appeal No P-02(IM)(NCVC)-70-01/2024 on 17 September 2024 confirms the undertaking by the defendants not to withdraw the money from the bank accounts by making the following order:
2) This is the Appellant's application for stay of execution and interim order to unfreeze the appellant's bank account. We note that on 29 January 2024 the High court had granted a stay of the injunction dated 9 January 2024 and in para 3 of that order it is stated that the defendant (appellant) "Memberi akujanji untuk tidak melupuskan harta alih dan harta tidak alih sehingga pendengaran rayuan". This means that the stay was granted pursuant to an undertaking expressly given by the appellant counsel not to dispose of the appellant's movable and immovable properties until disposal of the appeal. It is clear and unambiguous that immovable property must include bank accounts. There was no appeal on the stay order and the undertaking pursuant to it.
[4] Despite the undertaking and the Stay Order, the defendants with the assistance & abetting from Messrs Ismail, Khoo & Associates, John Khoo, and Martin Khoo issued 3 letters dated 29 January 2024, 1 February 2024, and 9 February 2024 threatened the bank to unfreeze all the bank accounts and to withdraw the money, otherwise they will sue the bank for RM10,000,000.00 as damages and complained to Bank Negara Malaysia. Messrs Ismail, Khoo & Associates, John Khoo, and Martin Khoo also issued letter dated 21 May 2024 to OCBC Bank in relation to this matter.
[5] During the interpleader proceeding filed by OCBC Bank, this court confirmed that Messrs Ismail, Khoo & Associates, John Khoo, and Martin Khoo are bound by the undertaking. The COA also made the following order:
4) There was also an interpleader order dated 24 June 2024 made pursuant to OCBC's application where it was reiterated that there could be no uplifting of the defendant's bank account in OCBC. Again, there was no appeal.
5) Further, there was consequential order dated 15 July 2024 ordering compliance of the undertaking and to take all necessary action to give effect to the undertaking in
