JUDGMENT

Augustine Paul JCA:

[1] The appellant (the plaintiff in the High Court) was a client of Labuan Securities Sdn. Bhd. (hereinafter referred to as "LSSB"), a stock broking company, and had given several loans to LSSB. On 12 February 1999, a Special Administrator was appointed for LSSB as provided for under s. 24 of the Pengurusan Danaharta Nasional Berhad Act 1998 to settle LSSB's financial problems with its creditors. As a result of the appointment a Transfer of Liability Agreement dated 30 October 2000 was entered into between the parties. Accordingly, all of LSSB's liabilities to its creditors as of 2 September 1999 were transferred to Balforn Holdings Sdn. Bhd. (hereinafter referred to as "Balforn") as "Special Purpose Vehicle" for the purpose of the proposal for settlement. Subsequently, Balforn was wound up and on 17 January 2001, the respondents were appointed as the liquidators at the creditors meeting. On 1 March 2001, the respondents as Balforn's liquidators invited the creditors to submit proof of debt through an advertisement placed in the New Straits Times. The appellant then submitted a proof of debt in Form 55 of the Companies (Winding-Up) Rules 1972 (hereinaft