Leave of Court is required before commencing actions against a liquidator to ensure proper administration of the winding-up process, and any imposed fees must be reasonable and justified.

Introduction

[1] This is an appeal by Mr Andrew Heng (the 1st appellant/1st defendant in the High Court) who is the liquidator of Masmeyer Development Sdn Bhd, (the 2nd appellant/2nd defendant in the Court below) against the decision of the learned High Court Judge (HCJ) dated 7 November 2023 in allowing the respondent's (the plaintiff in the Court below) application made by way of an Originating Summons dated 30 March 2023 (the OS), challenging the 1st defendant's/1st appellant's decision pertaining to the liquidator's fee. The respondent, ie, Mr Chong Kok Wooi, is also representing the unit owners of Marinox Sky Villas Condominium in Pulau Pinang.

[2] In this judgment, the parties will be referred to as they were in the High Court.

Background Facts

[3] The plaintiff filed the OS on his behalf as well as on behalf of 32 purchasers of a project known as Marinox Sky Villa (the said Project) in Penang.

[4] The 2nd defendant (the Company) was the developer of the said project.

[5] The plaintiff entered into a Sale and Purchase Agreement dated 2 December 2013 to purchase one unit of apartment of the said Project from the 2nd defendant for the purchase price of RM1,095,000.00

[6] The 2nd defendant was wound up by the Pulau Pinang High Court on 18 July 2019, and the 1st defendant was appointed as the liquidator of the 2nd defendant on 30 January 2020.

[7] At the time of the winding-up order, the individual strata titles of the said Project are yet to be issued by the relevant land office.

[8] On 21 July 2020, 4 months after the 1st defendant's appointment as the liquidator, the individual strata title of the said Project was issued by the Land Office.

[9] The 1st defendant, vide a letter dated 4 August 2020, notified the plaintiff and other purchasers of the said Project that the liquidator's administrative fee for, among others, the execution of the Memorandum of Transfer is fixed at a flat rate of RM8,000.00 for each purchaser. The 1st defendant stated that there were insufficient funds available in the 2nd defendant and that the fee imposed is necessary for previous works and for further works to be done.

[10] The plaintiff, together with 32 other purchasers take issue with the 1st defendant pertaining to the said fee and filed the OS.

Decision Of The High Court

[11] In allowing the plaintiff's OS, the learned HCJ found that the administrative fee of RM8,000.00 for each unit is unfair and unreasonable for the following reasons:

(a) there is no equality of bargaining power between the plaintiff and the 1st defendant, in light of the administrative fee imposed by the 1st defendant being non-negotiable and determined at the 1st defendant's absolute discretion;

(b) the 1st defendant, as the liquidator of the Company, is duty bound to carry out the duties and obligations of the Company under the sale and purchase agreements and the Housing Development (Control and Licensing) Act 1966 . In this instance, the issuance of the strata titles and the execution of the Memorandum of Title Transfer to perfect the title to the unit owners;

(c) upon receipt of the full purchase price, the defendants become a bare trustee of the units in the housing project in favour of the plaintiff and other unit owners. The 1st defendant cannot use