Majority shareholders cannot pursue oppression claims under Companies Act section 346 when they retain control, as they have the means to address grievances themselves; oppression claims must show distinct personal loss, not reflective of corporate injuries.

Elaine Yap Chin Gaik JC:

Introduction

[1] This is an unusual case of an oppression claim filed under s 346 of the Companies Act 2016 (" CA ") by the majority shareholders of a company who also control the Board of Directors and the management of the company. The 1st Defendant, Stronghold Cycles Sdn Bhd ("Stronghold"), is the subject company and is named as a nominal party represented by the same solicitors representing the Plaintiffs.

[2] It is convenient to identify the parties by their names, affiliations and alliances:

[3] There are 2 related actions at the Shah Alam High Court which have been filed by the parties, namely:

(a) BA-22NCvC-75-02/2023 filed by Stronghold and the Majority Shareholders against KS Goh, Juan, Didi Resources, Messrs Shaw & Co (a law firm) and Goh Brothers Motorcycles Sdn Bhd ("Suit 75"); and

(b) BA-22NCvC-87-02/2024 filed by Goh Brothers Motorcycles Sdn Bhd against Stronghold and the Majority Shareholders ("Suit 87").

[4] The Defendants have all applied to strike out the action vide 3 separate applications:

a) Enclosure 29 - filed by Didi Resources and Didi Automotive Sdn Bhd

b) Enclosure 32 - filed by KS Goh, Didi Motorcyles Sdn Bhd, Didi Lifestyle Pte Ltd and GB Group

c) Enclosure 34 - filed by Juan

[5] In this Judgment, the "Plaintiffs" refer to the Majority Shareholders and the "Defendants" refer collectively to the Didi Group, the GB Group, KS Goh and Juan.

Background Facts

[6] According to the Plaintiffs, Stronghold was incorporated on 24 February 2016 to operate the business of importing premium foreign motorcycles for sale through distributorships and dealerships. This followed from discussions held in 2015 between the promoters of Stronghold, namely KS Goh and the Plaintiffs.

[7] The Plaintiffs allege that the discussions culminated in an arrangement when Stronghold was incorporated ("Arrangement") which in substance would include the following mutual understanding:

(a) KS Goh would nominate Didi Resources to hold his shares.

(b) Didi Resources would be the entity to apply for the franchise- approved permits to import the motorcycles as required from the Ministry of International Trade and Industry, and do so on behalf of Stronghold.

(c) A curated motorcycle-themed lifestyle and event space branded as "The Gasket Alley" would be set up.

(d) Stronghold would rent the space for "The Gasket Alley".

(e) Ng Chik Voon, one of the Plaintiffs who was in the midst of securing the distributorship for Zero Engineering motorcycles through his own company, would treat that distributorship as the start of business for Stronghold, to be followed by other motorcycle brands.

[8] The Plaintiffs thus contend that Stronghold was formed as a quasi-partnership with a legitimate expectation on the part of the Plaintiffs that the Arrangement would be honoured by KS Goh and Didi Resources.

[9] The following events transpired in line with the Arrangement:

(a) the Zero Engineering distributorship was reissued to Didi Resources on 20 November 2015 and Didi Resources applied for and obtained other distributorships.

(b) Didi Resources subsequently secured the Piaggio Group Distributorships, Harley Davidson Distributorships and Royal Enfield Distributorship.

(c) Stronghold invested in and set up "The Gasket Alley."

According to the Plaintiffs however, the Defendants carried out various other acts that were not in line with the Arrangement. They may be summarized as follows:

(a) Breach of the legitimate expectation regarding the Arrangement

Importing, distributing and dealing with the premiu