RK Nathan JC:

The Prologue To The Petition

In response to an application by a group of members of the Parent/Teacher Association of Garden School, amongst whom were three significant members of the dramatis personae, namely Ahmad Roose, Dr. I.U. Malik (the 3rd petitioner herein) and P.S. Sundram (the supporting creditor herein and the protagonist in this drama), the Secretary General of the Ministry of Education by way of a letter dated 28 July 1978 (Exh. M2) directed the Registrar of Schools Selangor/Wilayah Persekutuan to issue temporary certificates of registration to establish three schools, that is, the Kindergarten, the Primary and the Secondary School known as Fairview Schools Association, pursuant to the terms and conditions specified in that said letter. Exhibit M2 clearly stated that the sponsors intended the schools to be operated on a non-profit basis and that any profits obtained from operating the schools would be applied to augment the facilities and to upgrade the quality of education.

Pursuant to this directive from the Ministry of Education, temporary registration certificates were issued on 1 September 1978 in the name of Ahmad Roose as chairman of the schools.

There is no doubt in my mind that the avowed objective of the sponsors/ founders, as noted in Exh. M2 by the Secretary General to the Ministry of Education, became the underlying principle and policy for Fairview Schools Association which commenced operation on 11 September 1978 under the management of the founders. The 2nd petitioner, the wife of Ahmad Roose, was its first principal.

Subsequently the founders decided to form a company to provide an opportunity to parents with children in the schools, most of whom being expatriates, to have a say in overseeing the management of the schools. The company envisaged by the founders pursuant to the minutes of the meeting held on 22 November 1978 was confined to parent-shareholders, with each family limited to one unit of RM50 share. The shareholding was however not compulsory. The said shares remained at par value even though transferable at a later date to an incoming parent. The purchase value of the share is to be treated as a refundable deposit on receipt of a demand notice and nothing more.

The Company Called Fairview Schools Bhd

At the time of incorporation the nominal capital of the respondent was RM50,000 divided into 50,000 ordinary shares of RM1 each and the current paid-up capital is RM23,150. At all material times, the affairs of the respondent were conducted on a non-profit basis in accordance with the condition imposed by the Ministry of Education. The schools had developed from a population of 5 students in 1978 to 500 in 1992 and would have increased further if not for space limitations which prompted the Board of Directors of the respondent to seek alternate premises for the schools. The then Board of Directors managed to secure a three-acre piece of land in Wangsa Maju (Wangsa Maju land) and obtained loan facilities towards its purchase and building costs. Up till 10 November 1992 the affairs and management of the respondent were carried out by the then Board of Directors without any dissension from any quarter. On 11 November 1992 an Extraordinary General Meeting (EGM) was held to decide on an increase of school fees by 30% to meet the upward revision of remuneration of the teaching and non-academic staff and to facilitate the servicing of a loan to meet the purchase of the land and the erection of buildings thereon.

At the scheduled meeting on 11 November 1992 which was chaired by Ahmad Roose, one K.B. Thuraisingham and a few others interrupted the meeting and purported to pass a vote of no confidence in the then Board of Directors allegedly under "a common law right at all gatherings". The meeting becoming unruly and the Chairman quit. The said K.B. Thuraisingham was appointed to chair the meeting despite the presence of two other directors. Some directors resigned. On 17