Mohan A/L Chatram M.T Ramchandani v Ketua Pengarah Insolvensi Wilayah Persekutuan Kuala Lumpur, 08-01-2015

• Judge: WONG KIAN KHEONG
• Judgment Date: 08 January 2015
• Court: High Court (Malaysia)
• Appellant: MOHAN A/L CHATRAM M.T RAMCHANDANI
• Record Number: 24NCC-337-09/2014
• Respondent: KETUA PENGARAH INSOLVENSI WILAYAH PERSEKUTUAN KUALA LUMPUR

DALAM MAHKAMAH TINGGI KUALA LUMPUR

(BAHAGIAN DAGANG)

SAMAN PEMULA NO: 24NCC-337-09/2014

Dalam Perkara Seksyen 236 Akta Syarikat 1965;

Dan

Dalam perkara Perjanjian Jual Beli bertarikh 05.08.2013 mengenai hartanah yang dipegang di bawah Hakmilik Starata No. PN79829/M1C/1/54, Lot 49356, Mukim Cheras, Daerah Hulu Langat, Negeri Selangor Darul Ehsan

Dan

Dalam Perkara Aturan 7 dan Aturan 28 Kaedah-Kaedah Mahkamah 2012

ANTARA

MOHAN A/L CHATRAM M.T RAMCHANDANI

(No K/P: 620318-10-6081) … PEMOHON

DAN

KETUA PENGARAH INSOLVENSI

WILAYAH PERSEKUTUAN KUALA LUMPUR

(sebagai penyelesai sementara/likuidator bagi

TAGFOTO AV TRADING SDN BHD (258594-D)

(yang dahulunya dikenali sebagai Tarita Photo AV Tading Sdn Bhd) … RESPONDEN

GROUNDS OF JUDGMENT

A. Introduction

1. This case discusses, among others, the following issues:

(a) whether a purchaser (Purchaser) of property owned by a company which is subsequently wound up, can file an action to claim for specific performance of the sale of property without obtaining leave of the winding up court under s 226(3)(a) of the Companies Act 1965 (CA) and

(b) whether the Purchaser’s application to set off from the sale price a debt due from the wound up company to a person who has entered a private caveat over the property (Caveator) constitutes an undue preference in favour of the Caveator.

B. Wrong description of parties

2. In this originating summons (OS) the solicitors who filed the OS, Messrs JP Chong & Co. (Messrs JPC) used the terms “applicant” and “respondent” to describe the parties. With respect, the right terms should be “plaintiff” and “defendant” as stated in Order 7 rule 2(2) of the Rules of Court 2012 (RC) According to Order 7 rule 2(3) RC, only a party who files an ex parte OS, should be described as an “applicant”. I reproduce Order 7 rule 2(2) and (3) RC as follows:

“7(2) The party taking out an originating summons, other than an ex parte originating summons, shall be described as a plaintiff, and the other parties shall be described as defendants.

(3) The party taking out an ex parte originating summons shall be described as the applicant.”

3. In accordance with Order 7 rule 2(2) RC, this court will use the terms “plaintiff” and “defendant”.

C. Facts

4. The defendant company (Defendant) purchased a parcel of shop office (Parcel) from Jeramuda Properties Sdn. Bhd. (Developer).

5. The Defendant sold the Parcel to the plaintiff (Plaintiff) by way of a sale and purchase agreement dated 5.8.2013 (SPA).

6. The following terms and conditions of the SPA are relevant to the OS:

(a) recital “E” (Recital E) states that the Parcel has been assigned to Public Bank Bhd. (Bank);

(b) clause 1.1 states that the Plaintiff has purchased the Parcel from the Defendant for a sum of RM650,000 (Price). According to clause 2.1, the Defendant acknowledged receipt of a deposit of RM65,000 (Deposit) from the Plaintiff;

(c) clause 1.2(b) provides that the SPA is conditional upon the Defendant obtaining the consent of the State Authority (SA) for the SPA and the transfer of the Parcel to the Plaintiff. The SA’s consent is required by clause 1.3 to be obtained within 6 months from the date of the SPA (Conditional Period). According to clause 1.5, the Plaintiff has the right to terminate the SPA if the SA’s consent is not obtained within the Conditional Period or any extension of the Conditional Period; and

(d) according to clause 7.2, immediately after the execution of the SPA, the Plaintiff “shall be entitled” at the Plaintiff’s own cost to enter a private caveat in respect of the Parcel (Clause 7.2).

7. A winding up petition was presented on 27.3.2014 against the Defendant. On 23.5.2014, the Kuala Lumpur High Court wound up the Defendant and appointed the Official Receiver (OR) as the Defendant’s liquidator (Liquidator).

8. The Plaintiff’s affidavit in support of the OS (Plaintiff’s Affidavit) alleged the following:

(a) one Mr. Lim Haw Sek (Mr. Lim) has entered a private caveat over the Parcel. The Plaintiff’s Affidavit exhibited 2 letters dated 27.1.2014 as follows -

(i) a letter from Mr. Lim’s solicitors, Messrs Chan & Associates (Messrs CA), to the Plaintiff’s former solicitors, Messrs Ashok Puri Hanifah & Co (Messrs APH), which stated, among others -

“2. To facilitate the perfection of transfer from the Developer to [Defendant], we enclose our client’s written consent under s 322(5)(b) of the National Land Code [NLC].

3. We understand that upon the transfer, the existing loan from [Bank] will be redeemed.”; and

(ii) a letter from Mr. Lim to the Selangor Registrar of Titles which stated, among others –

“Saya sebagai pemegang Kaveat Persendirian No. Perserahan: 2826/2013, Jilid No.: -, Folio No.: - yang didaftarkan pada 03.04.2013 dengan ini tiada apa-apa halangan dan memberi kebenaran di bawah Seksyen 322(5)(b) Kanun Tanah Negara untuk pendaftaran suratcara Pindahmilik:-

DARIPADA: LYL Land Sdn Bhd (Pemaju) atau Jeramuda Properties Sdn Bhd (Pemunya)

KEPADA: [Defendant]

Sebelum Kaveat itu ditarikbalik [sic].”;

(b) Messrs APH wrote a letter dated 12.6.2014 to the OR (Letter dated 12.6.2014 from Messrs APH) which stated, among others –

“… We had also been informed by the [Defendant] that there had been a private caveat lodge [sic] on the [Parcel] as a result of the [Defendant] owing the Caveator a sum of RM270,000.00. This was confirmed by the Caveator’s Solicitors, [Messrs CA] via their letter dated 04/09/2013, a copy of which is enclosed herewith for your attention.

…

The [Defendant’s] Solicitors, [Messrs JPC] had obtained the blanket consent in favour of the [Defendant] and had proceeded to present the first transfer to register the [Defendant] as the registered owner of the [Parcel].

…

Please be informed that the [Plaintiff], at the request of one of the [Defendant’s] directors, namely Mr. Ng Chin Chye who have [sic] since passed away, had agreed to pay for first transfer charges, bank instalments and etc for the [Parcel]. … Enclosed is a copy of the payments list that has been paid by the [Plaintiff] on behalf of the [Defendant] thus far.”

(emphasis added);

(c) the OR replied to the “Letter dated 12.6.2014 by Messrs APH” by informing Messrs APH to obtain a court order (OR’s Letter). The letterhead of OR’s Letter stated “Jabatan Insolvensi Malaysia”; and

(d) the Plaintiff has made the following payments on behalf of the Defendant (Plaintiff’s Payments) –

(i) the Defendant’s loan instalments to the Bank; and

(ii) management fees and related charges in respect of the Parcel which are due from the Defendant to the company managing the building wherein the Parcel was situated.

D. Relief claimed in OS

9. In the OS, the Plaintiff prayed for, among others, the following relief:

(a) an order for the Defendant to complete the SPA (1^st Prayer);

(b) the Defendant be allowed to use part of the Price to pay Mr. Lim (2^nd Prayer); and

(c) the Plaintiff’s Payments to be set off from the Price (3^rd Prayer).

E. OR’s 2 preliminary objections

10. The OR raises the following 2 preliminary objections against the OS:

(a) in the OS, the Plaintiff has named “”Ketua Pengarah Insolvensi Wilayah Persekutuan Kuala Lumpur (sebagai penyelesai sementara/likuidator bagi [Defendant]” [the Director General of Insolvency (DGI)]. According to the OR, the Plaintiff should have named the OR as the Liquidator and not the DGI (1^st PO); and

(b) before the filing of the OS, the Plaintiff did not obtain leave of the winding up court (2^nd PO).

F. How should preliminary objections be decided?

11. In deciding the 2 PO’s, I adopt the following dicta by Gopal Sri Ram JCA (as his Lordship then was) in the Court of Appeal case of Maril-Rionebel (M) Sdn Bhd & Anor v Perdana Merchant Bankers Bhd & Other Appeals [2001] 4 MLJ 187, at 195:

“There is a trend - and it is an unhealthy trend - for practitioners to raise several points either on several different applications, or by way of preliminary objections on procedural grounds to the same proceeding. As each application or point of objection fails, an appeal is at once lodged, and the aid of this court is sought to stay all proceedings in the court below pending the hearing of the appeal against the spurious procedural objection. Let me say at once that such a practice constitutes an abuse of the court's process, leads to injustice and should not be countenanced by judges. A litigant who has a number of procedural and substantive grounds in opposition to any cause or matter, must take all of them in one go. He cannot present his case in instalments. He cannot take one procedural point at a time and invite a separate ruling from the presiding judge. This type of advocacy which has been on the rise over the past few years results in serious delays in the various stages of litigation. Judges at first instance and magistrates are therefore advised not to entertain these so called preliminary objections, save and except where they go to the jurisdiction of the particular court.”

(emphasis added).

12. The above dicta, in my view, is consistent with Order 34 rule 1(1)(b) RC to “secure the just, expeditious and economical disposal” of cases.

G. 1^st PO

13. Section 227(7) CA...