Liza Chan Sow Keng JC:

GROUNDS OF JUDGMENT

INTRODUCTION

[1]ÂÂIn this action, the Plaintiffs’ claim against the 1^st Defendant (“Azrin”) is for breach of trust of 1,350,000 shares in Cyberlynx International Sdn Bhd (“Cyberlynx”) transferred to her on trust and as nominee for the Plaintiffs and another 1,350,000 shares in Cyberlynx International Sdn Bhd (“Cyberlynx”) allotted to her by capitalising monies owed to the Plaintiffs by Cyberlynx on trust and as nominee for the Plaintiffs whilst the claim against the 2^nd Defendant (“Nathan”) is for breach of agreement, fraudulent misrepresentation, inducing and dishonestly assisting the 1^st Defendant in breach of trust causing loss to the Plaintiffs and depriving them of the Cyberlynx shares.

[2]ÂÂThe Defendants denied the claim.

[3]ÂÂDuring trial conducted virtually online by using the Zoom video conferencing platform lasting 9 days, the Plaintiffs called two witnesses - the 1^st Plaintiff (“Ashok” interchangeably, “1st Plaintiff”) and the 2^nd Plaintiff (“Frank” interchangeably, “2nd Plaintiff”), whilst both Defendants testified.

[4]ÂÂI had on 11.1.2022 allowed the Plaintiffs’ claim. This judgment contains the reasons for my decision.

Background

[5]ÂÂThe undisputed facts are:

5.1 Cyberlynx International Sdn Bhd (“Cyberlynx”) is a company incorporated pursuant to the laws of Malaysia, and is in the business of providing private higher education services;

5.2 Cyberlynx owns and runs a private higher education institution by the name of Cyberlynx International College based at 27, Jalan RU 7/1, Seksyen 7, 46050 Petaling Jaya, Selangor Darul Ehsan;

5.3 Cyberlynx International College’s registration was renewed from 18.3.2018 to 17.3.2023;

5.4 As at 30.10.2007, the total issued and paid up capital of Cyberlynx was RM525,000.00 divided in 525,000 shares of RM1.00 each. The shareholding structure of Cyberlynx then was as follows;

i)Mohd Ali bin Che Ramlee: 150,000 shares (28.6%)

ii)Dato’ Ashok: 262,500 shares (50%)

iii)Frank: 87,500 shares (16.6%)

iv)Tuck Cheong: 25,000 shares (4.8%)

5.5 In or about 26.12.2007, Ashok transferred 162,500 Cyberlynx shares to Frank;

5.6 On 1.4.2011, Cyberlynx allotted an additional 525,000 shares of RM1.00 each to the existing shareholders, thereby increasing the total paid up shares of Cyberlynx to 1,050,000 shares. The shareholding structure of Cyberlynx as at 1.4.2011 was as follows:

i)Mohd Ali bin Che Ramlee: 300,000 shares (28.6%)

ii)Ashok: 200,000 shares (19%)

iii)Frank: 500,000 shares (47.6%)

iv)Tuck Cheong: 50,000 shares (4.8%)

5.7 On 1.7.2012, Cyberlynx allotted an additional 300,000 shares of RM1.00 each to Ashok, Frank and Tuck Cheong, thereby increasing the total paid up shares of Cyberlynx to 1,350,000 shares. The shareholding structure of Cyberlynx as at 1.7.2012 was as follows:

i)Ashok: 642,857 shares (47.62%)

ii)Frank: 642,857 shares (47.6%)

iii)Tuck Cheong: 50,000 shares (4.8%)

5.8 On 20.7.2016, Ashok transferred the remainder 237,857 (17.62%) Cyberlynx shares to Monisha;

5.9 Nathan is a director Mission Equities Sdn Bhd (“Mission Equities”), and a shareholder holding 90% of the issued and paid up shares in Mission Equities;

5.10 Nathan is the directing and controlling mind of Mission Equities;

5.11 Nathan agreed to invest in Cyberlynx through his company known as Mission Equities;

5.12 The Plaintiffs (with the exception of Ashok), Azrin and Cyberlynx entered into a Shareholder’s Agreement with Mission Equities on or about 12.7.2019 (“SHA”)

5.13 Pursuant to the terms of the SHA, Mission Equities was meant to invest a sum of RM1.5 million in Cyberlynx as subscription monies for the purchase of 3,150,000 shares in Cyberlynx, equivalent to 70% of the equity of Cyberlynx, in the following manner:

i)A sum of RM750,000.00 on the Close Date of the SHA Agreement;

ii)A sum of RM375,000.00 upon Cyberlynx obtaining the Malaysian Qualifications Agency’s approval for the Diploma in Veterinary Technology Programme; and

iii)A sum of RM375,