Back
2025 MarsdenLR 2794
HIGH COURT MALAYA SHAH ALAM
PERUSAHAAN OTOMOBIL NASIONAL SDN BHD – Appellant
Versus
UCM AUTOMOTIVE SYSTEMS SDN BHD – Respondent
[Originating Summons No: BA-24NCC-87-07/2024]
To obtain a Fortuna injunction, a claimant must demonstrate a bona fide dispute on substantial grounds and that irreparable harm will result from a winding-up petition; mere denial of debt is insufficient.
Headnote:(A) Companies Act - Sections 465(1)(e) and 466(1)(a) - Fortuna injunction - Plaintiff sought to restrain Defendant from presenting a winding-up petition - Court found no bona fide dispute over the alleged debt due - Plaintiff must prove irreparable damage and no chance of success of the winding-up petition - Application dismissed with costs. (Paras 8, 10, 21, 24, 27)
(B) Injunction Principles - To obtain a Fortuna injunction, the applicant must establish a bona fide dispute on substantial grounds and demonstrate that a winding-up petition could cause irreparable damage - Mere refusal to pay does not equate to a genuine dispute. (Paras 10, 11, 25)
Facts of the case:
Plaintiff, a national vehicle manufacturer, filed an application against Defendant regarding a statutory demand for RM4,310,200.36, claimed to be unpaid invoices and associated penalties. Defendant issued a notice seeking payment.
Findings of Court:
Plaintiff's application for a Fortuna injunction was dismissed as no genuine dispute or irreparable harm was established, with costs awarded against the Plaintiff.
Issues: Whether there existed a bona fide dispute regarding the debt and if the winding-up petition would cause irreparable damage to the Plaintiff.
Ratio Decidendi: The Court held that a mere assertion of a dispute without substantial grounds does not justify an injunction; failure to pay following a valid demand supports a presumption of insolvency.
Result: Application for Fortuna injunction dismissed.
| Table of Content |
|---|
| 1. establishment of contractual obligations between parties. (Para 1 , 2 , 3 , 4) |
| 2. allegations of outstanding debts and claims. (Para 5 , 6) |
| 3. criteria for granting a fortuna injunction. (Para 7 , 10 , 11 , 12 , 21) |
| 4. the requirement for genuine dispute in debt claims. (Para 14 , 15 , 16 , 17) |
| 5. consequences of neglect or refusal to pay. (Para 18 , 19 , 20 , 22 , 23) |
| 6. conclusions regarding application dismissal. (Para 26 , 27) |
Introduction
[1] Plaintiff filed an Originating Summon for an order (Fortuna Injunction) to restrain Defendant from presenting a winding up petition pursuant to a Statutory Notice under s 466(1) of the Companies Act ( CA ) dated 10 July 2024.
The Parties
[2] Plaintiff (Proton) is one of Malaysia's largest national vehicle manufacturers, and it manufactures, assembles, and sells motor vehicles and related products.
[3] Defendant (UCM) is in the business of supplying factory-fitted automotive air-conditioning systems components and related parts, including the cooling modules system and the individual parts, namely the CVT Oil Cooler to Proton for various PROTON car models (Parts).
[4] The obligations and/or terms governing the supply of parts between the parties are as formalised in accordance with the Master Agreements read together with the respective Letters of Engagement.
The Fortuna Injunction Application
[5] UCM has been supplying car parts to Proton, and there were also additional forex charges/forex claims that allegedly remain due and owed by Proton. UCM had issued several invoices for the outstanding claims to Proton, but they had refused to remit payment and/or neglected to do so.
[6] On 10 July 2024, UCM issued the Statutory Notice pursuant to s 465(1)(e) of the CA read together with s 466(1)(a) to Proton requesting payment of RM4,310,200.36 (the outstanding sum) within twenty-one (21) days. It was submitted and averred in UCM's affidavit in reply that the alleged sum was for the following:
(a) Unpaid Outstanding Invoices - RM1,742,996.89
(b) Interest on the unpaid outstanding invoices - RM164,482.81 (Interest)
(c) Freight and Forex Claims - RM970,153.22
(d) Exora End of Production Parts Claim - RM1,432,567.44.
[7] After hearing both parties read the affidavit and submissions filed, I have decided that:
1. Given the circumstances of the case, I find that Proton's prospects of success in defending the winding up proceedings, if instituted, are unfavourable to them both in law and in fact.
2. Having reviewed the details of the amount due as submitted, I find that Proton's contention disputing it and/or submitted to the contrary against the issuance of the Statutory Notice does not amount to a bona fide dispute.
3. I am not persuaded that there is a genuine dispute that should be adjudicated upon, as no substantial grounds have been advanced that would necessitate a full trial of the same.
4. Nor do I see any valid controversy over any contestable matter raised by Proton, as there are merely inconsistencies in the issuance of the invoices, most of which are undisputed.
5. As to the issue of interest charged, I agree with UCM's submission that it is immaterial and irrelevant for Proton to dispute the charges.
[8] Accordingly, Proton's application for a Fortuna Injunction is dismissed with cost of RM8000.00, subject to the allocator.
[9] Dissatisfied with the above decision, Proton appealed to the Court of Appeal. My reasons are below.
Analysis And Findings
[10] The law on Fortuna Injunction is trite and established as decided in the case of Mobikom Sdn Bhd v. Inmiss Communications Sdn Bhd ; ; . There were two circumstances which Proton must establish when a company may restrain the presentation of a winding-up petition, that is (refer to the case of Fortuna Holdings Pty Ltd v. The Deputy Commissioner of Taxation of the Commonwealth of Australia [1978] VR 83):
(a) Where the presentation of the petition might produce irreparable damage to the company and where the winding-up peti
