A winding-up petition driven by mala fide intent to stifle ongoing litigation constitutes an abuse of process.

A. Factual Background Of The Appeal

[1] There are two Appeals before us namely;

i) Rayuan Sivil No: W-02(NCC)(A)-1004-06/2022 ("Appeal 1004") and

ii) Rayuan Sivil No: W-02(NCC)(A)-1113-06/2022 ("Appeal 1113").

[2] Both Appeals concern a winding up petition which was allowed by the learned Judicial Commissioner (the learned JC) at the Kuala Lumpur High Court on the grounds of justice and equitability in view of an alleged lapsing of the company's purpose or business as well as the alleged breakdown of trust and confidence of management.

[3] On the other hand, the Appellants (Respondents in the Petition proceedings below) contested against the winding up of the company under the contention that the entire Petition was not at all a genuine seek of legal redress and was in actuality driven by mala fide intent to stifle the company's suit against the Petitioner's inextricably related company.

[4] The Appellants also strenuously contend that the company is certainly a going concern and is still actively engaged in business in line with its businesses as enumerated within the company's Memorandum and Articles of Association.

[5] The Appellant in Appeal 1113 (Le Apple Boutique Hotel (KLCC) Sdn Bhd) is the company being petitioned to be wound up by the Respondent. The Appellant in Appeal No 1004 (Le Apple Boutique Hotel Sdn Bhd) is one of the shareholders of the Appellant 1113.

[6] For a better understanding of the matter at hand, it is necessary to set out the facts of the case that have led to the winding up petition. The parties will be referred to as they were at the High Court.

[7] The Petitioner is Keen Solution Sdn Bhd ("the Petitioner"). The Petitioner and Le Apple Boutique Hotel Sdn Bhd ("LABHSB"- the Appellant in Appeal 1004) are co-shareholders of a company by the name Le Apple Boutique Hotel (KLCC) Sdn Bhd ("LABHKLCC"- the Appellant in Appeal 1113). LABHSB holds majority shares of 55% while the Petitioner held the minority shares of 45% in LABHKLCC.

[8] As set out in its Memorandum and Articles of Association ("M&A"), LABHKLCC has many businesses which include the business of Hotel Operations. LABHKLCC entered into a tenancy agreement with the Petitioner's related company, PGCG Assets Holdings Sdn Bhd ("PGCG") for the purposes of development and operation of a hotel at No 160 Jalan Ampang ("Demised Property") on 18 October 2014 ("Tenancy Agreement").

[9] The Tenancy Agreement became the core of litigation between PGCG and LABHKLCC in suit no WA-22NCVC-832-12/2020 ("Suit 832"). In Suit 832, LABHKLCC sued PGCG for a total of RM19,644,322.00 being the capital expenditure LABHKLCC had expended towards the Demised Property. Out of this amount claimed, LABHKLCC was already successful in obtaining a Summary Judgment on 21 June 2021 for the sum of RM1.65 million. The remaining disputations regarding the Tenancy Agreement are still live issues in Suit 832 which is also slated to go on full trial. It must be strictly kept in mind that this specific disputation between LABHKLCC and PGCG is a live issue in Suit 832 and not at all an issue that should be addressed by the learned JC as well as this Court of Appeal.

[10] Nonetheless, apart and aside from the merits in Suit 832, the factum and existence of Suit 832 are certainly revealing of the true nature and the ulterior motive behind the Petition. This will be demystified further along in this judgment.

[11] It is no mystery that Suit 832 would be immensely financially lucrative and advantageous to the best interest of the Petitioner via its shareholding in LABHKLCC if it bears fruit. It would be in the utmost