JUDGMENT

Chang Min Tat J:

In this action, the plaintiffs for themselves as shareholders in a private limited company, the Federal Transport Services Co. Ltd. hereafter called the company, and for others named but not joined in, also shareholders in the same company, as well as the company itself, sued the defendants for

(a) an injunction restraining the defendants from acting as directors of the company,

(b)an injunction restraining the defendants from dealing with the funds of or using the seal of or dealing in any manner with the properties and assets of the company or otherwise interfering with the management of the company,

(c)a declaration that the defendants are not directors of the company, and for costs and such further or other order as the Court may deem fit.

The prayer for the first injunction was grounded on a resolution said to have been passed at an extraordinary general meeting of the company held on 23 April 1972 at the Bangunan UMNO Lama, Jalan Kelab Butterworth, which purported to forthwith remove from office the defendants as such directors.

It is somewhat curious, if I may so advert to this as a fact without disrespect, to note that the company itself is the first plaintiff. How correct this is in the light of the true facts of this case is nowhere shown to me but if I may hazard a guess, this might explain the conditional appearance entered by the defendants. However no further action on this proposed objection was taken and the time having lapsed, the appearance stood to be treated as unconditional.

This is basically an action by minority shareholders against the defendants. This became clear, not on the writ, but in the affidavit filed by Mustapha bin Pachik, the third plaintiff in support of an application by notice of motion for interlocutory orders of injunction. Of the issued capital of $265,550 made up of 26,555 fully paid up shares of $10 each, all the plaintiffs excepting the first plaintiff which is the company itself, held 778 shares as against the 849 paid up shares held by the defendants jointly. The state of the proxies at any given time was never referred to in any of the affidavits.

In this affidavit, the deponent, the third plaintiff, charged the defendants with "thoroughly irresponsible and unsatisfactory mismanagement" causing the company to sustain heavy losses. The acts of mismanagement alleged were:

(a) the defendants had not submitted to the members any proper profit and loss account or any account whatsoever

(b)on or about 16 August 1971 the defendants leased five of the company's buses to Ghazali bin Mohamed Saad at a rent of $600 per month for operating privately and for his own benefit and in breach of the terms of the licence and haulage permits

(c)on 21 September 1971 the defendants allotted some 4430 new shares to themselves, in breach of Art. 23 of the company's articles of association and without the other members of the company being given an opportunity to take up such allotments.

It was also alleged that at the extraordinary general meeting called for and convened on 23 April 1972, at which some 150 members attended, a resolution was passed, said to be unanimously, removing the defendants from office. However it was admitted that the second defendant as chairman of the meeting opposed this resolution and demanded a poll but it was said that when his right to call a poll was challenged, the second defendant and the other defendants left the meeting. The meeting was carried on in their absence and a caretaker body appointed to manage the affairs of the company.

The answer to the plaintiffs' allegations against the defendants was made by Haji Ahmad bin Said, the second defendant. He claimed to have been duly authorised to depose to the affidavit by the other defendants as directors of the company. He said that at the material time, the third plaintiff himself was a director and with his holding thrown in, the directors held not 849 shares but 904. Then he refuted