Leave to continue proceedings against a financially distressed company under Judicial Management requires a balancing of interests, favoring parties that would suffer significant prejudice from refusal.

JUDGMENT

Azmi Ariffin J:

Introduction

[1] The Applicant appeal against the Summary Judgment entered against the Applicant to the Court of Appeal for a sum of RM3,740,900.00 which was fully paid by the Applicant to the Proposed Intervener.

[2] The Applicant also appeal to the Court of Appeal against the transfer of outstanding claim to Session Court.

[3] It is to be noted that both the Applicant Notices of Appeal were filed out of time. The Applicant then filed Notices of Motion to seek leave from the Court of Appeal for an extension of time to file Notices of Appeal.

[4] The Leave Application were fixed for hearing on 30 June 2020 and was unanimously allowed by the Court of Appeal.

[5] Dissatisfied with both the Court of Appeal decision, the Proposed Intervener appealed to the Federal Court via Civil Application No 08(i)-188-07/2020(W) and Civil Application No 08(i)-189-07/2020(W) respectively against the Court of Appeal decision in allowing the Applicant Notices of Motion for extension of time (despite 14 month delay) to appeal.

[6] On or about 14 August 2020, the Shah Alam High Court granted an order for Judicial Management to the Applicant.

[7] The Proposed Intervener filed encl 44 dated 30 July 2020 seeking leave from this Honourable Court under s 411 of the Companies Act for the following orders:

(1) An order that the Proposed Intervenor shall be allowed to intervene into the proceedings herein for the purposes of determining a question and/or issue that has arisen as-between the Applicant and the Proposed Intervenor;

(2) That this Honourable Court shall grant leave to the Proposed Intervenor to continue with all legal proceedings in the Sessions Court in Kuaia Lumpur for Civil Suit No:WA-B51-2/10/2019 including the taking-out and defending of ali interlocutory applications and any appeals emanating therefrom;

(3) That this Honourable Court shall grant leave to the Proposed Intervenor to continue with all legal proceedings in the Court of Appeal for Civil Appeal No:W-02(IM)(C)-2243-12/2019 ("Civil Appeal 2243"), including the taking-out and defending of all interlocutory applications and any appeals emanating therefrom;

(4) That this Honourable Court shall grant leave to the Proposed Intervenor to continue with all legal proceedings in the Court of Appeal for Civil Appeal No: W-02(IM)(C)-2247-12/2019 ("Civil Appeal 2247"), including the taking-out of all interlocutory applications and any appeals emanating thereform;

(5) That this Honourable Court shall grant leave to the Proposed Intervenor to continue with all legal proceedings filed by the Proposed Intervenor to the Federal Court of Malaysia via Civil Application No: 08(i)-188-07/2020(W), including the taking-out of all interlocutory applications and the appeal therein;

(6) That this Honourable Court shall grant leave to the Proposed Intervenor to continue with all legal proceedings filed by the Proposed Intervenor to the Federal Court of Malaysia via Civil Application No: 08(i)-189-07/2020(W), including the taking-out of all interlocutory applications and the appeal therein;

(7) Further to prayers (2), (3), (4), (5) and (6) above, a further order that in the event a Judicial Management Order is entered against the Applicant, that the leave of this Court shall continue to be granted to the Proposed Intervenor to continue with the proceedings referenced above;

(8) That the costs of this application and the allocator fee (if any) are to be made costs in the cause;

(9) Any further relief and/or remedy that this Honourable Court shall deem fit and proper so to grant.

Note: This prayer is withdrawn by the Proposed Intervener.

The Principles Governing The Application For Leave To Commenced Or Continued Proceedings Against A Company Placed Or Have Applied To Be Placed Under Judicial Management

[8] Courts also have through their decision devised themselves certain guidelines or principle for leave to commence proceedings against a company placed under judicial management. There are several examp