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2009 MarsdenLR 4357 ; 2009 MarsdenLR 1

SURIYADI HALIM OMAR, HISHAMUDIN MOHD YUNUS, AZHAR MAAH
WESTFORM FAR EAST SDN BHD – Appellant
Versus
CONNAUGHT HEIGHTS SDN BHD – Respondent



A party seeking an ex parte injunction must demonstrate urgency, and the failure to comply with notice provisions for such applications renders them void.

Headnote:(A) Companies Act 1965 - Section 218 - Injunction against winding-up proceedings - Appeal against High Court orders granting inter partes injunction and dismissing application to set aside ex parte injunctions. Court found that the respondent failed to demonstrate urgency to justify ex parte applications - Mandatory compliance with notice provisions under Rules of High Court - Justification provided by the respondent was found inadequate. Court exercises discretion to dismiss both inter partes injunctions while allowing appeals concerning ex parte injunctions, emphasizing the necessity of a bona fide dispute over debts in winding-up applications. (Paras 1, 64-68)

Facts of the case:
The respondent is a housing developer who appointed the appellant as the main contractor for a housing project. Disputes arose over non-completion of work and claims for debt under Section 218 notices issued by the appellant. The respondent sought injunctions to prevent winding-up petitions based on said debts.

Findings of Court:
The Court dismissed appeals regarding inter partes injunctions, emphasizing the importance of adherence to procedural rules concerning notice. Appeals pertaining to ex parte orders were allowed due to insufficient urgency demonstrated by the respondent.

Issues: The principal issues included whether the respondent failed to provide adequate notice for ex parte injunctions and whether a bona fide dispute existed regarding the debts in question.

Ratio Decidendi: The Court held that a party must demonstrate urgency for ex parte applications, with compliance to procedural rules deemed mandatory. Unless compelling evidence is presented to justify ex parte applications, the presiding judge's discretion should not be interfered with.

Result: Appeals W-03-212-2006 and W-03-215-2006 allowed; appeals W-03-213-2006 and W-03-214-2006 dismissed.

Table of Content
1. multiple appeals regarding injunction orders. (Para 1 , 2)
2. arguments concerning the failure to notify. (Para 3 , 18 , 19)
3. background facts of contractual disputes. (Para 8 , 12 , 14 , 15 , 16)
4. standard for granting temporary injunctions. (Para 11 , 26)
5. requirement for showing bona fide dispute for injunction. (Para 40)
6. final dismissal of the appeals with costs. (Para 41)
JUDGMENT

Suriyadi Halim Omar JCA:

[1] There were four appeals filed by the defendant (hereinafter referred to as the appellant) before us viz.:

i. W-03-212-2006 against the learned judge's order dated 20 November 2006, which inter alia granted an inter partes injunction restraining the appellant from presenting a winding-up petition against the plaintiff (hereinafter referred to as the respondent) for the sum of RM3,371,251.17 stated in a notice under s. 218 of the Companies Act 1965 under interim certificate 42;

ii. W-03-213-2006 against the learned judge's orders inter alia for not holding that failure to give notice to the appellant for the earlier ex parte application for injunction based on the above notice of s. 218 of the Companies Act 1965 was fatal;

iii. W-03-214-2006 against the learned judge's order dated 20 November 2006 dismissing the appellant's application to set aside the ex parte injunction order of 25 August 2006 relating to a notice under s. 218 of the Companies Act 1965 for a sum of RM711,993.69; and

iv. W-03-215-2006 filed by the appellant against the learned judge's order dated 20 November 2006, which inter alia granted an inter partes injunction to restrain the appellant from presenting a winding-up petition against the respondent for the above sum of RM711,993.69.

[2] We heard all the four appeals and at the conclusion of the hearing unanimously dismissed appeals W-03-212-2006 and W-03-215-2006. By majority, we likewise dismissed W-03-213-2006 and W-03-214-2006. Deposits of these appeals went towards the account of taxed costs.

[3] Before touching on the facts of the appeals I would like to briefly discuss the issue of want of notice for the ex parte injunctions, which was vehemently ventilated by the appellant. The appellant had submitted with particular reference to appeals W-03-213-2006 and W-03-214-2006 that the learned judge had erred when he failed to hold that the respondent's failure to give notice to the appellant for the respective ex parte applications was fatal. The basis of this legal argument was the case of University of Malaya Medical Centre v. Choo Chee Kon & Anor 2007 MarsdenLR 433 where Hishamudin Mohd Yunus J (as he then was), had opined that on the facts of that case the failure to give notice was clearly not satisfactory. The learned judge had remarked:

In my judgment, compliance with r. 1(2A)(c) is mandatory. If there had been non-compliance, it is a very serious breach of the Rules of the High Court and the ex parte order must be set aside. This approach is consistent with the policy behind the introduction of r. 1 (2A). I therefore, set aside the ex parte injunction order due to non-compliance of r. 1(2A)(c) of the RHC.

[4] Prior to making the above remark, and in support of it, the learned judge had referred to the Malaysian High Court Practice, 2001 Desk Edition 1 at p. 1032 before concluding r. 1(2A)(c) of the Rules of the High Court 1980 being mandatory. The said p. 1032 reads:

The requirements in r. 1(2A) are mandatory. Thus, where a plaintiff fails to give notice of an application made ex parte out of fear that it will defeat the purpose of the proceedings, the plaintiff must state in his supporting affidavit the reasons why notice in advance was not given to the defendant. As the introductory sentence in r. 1(2A) states that the affidavit 'shall contain a clear and concise statement', the statement must be stated clearly and concisely and may not be implied: Delimec Hygiene Sdn Bhd v. EMIC (M) Sdn Bhd; 2000 MarsdenLR 2173 at 197.

The consequence of the plaintiff's failure to

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