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Fact of the Case This suit regarding damages for breach of fiduciary duty where plaintiff claimed against the first defendant and 3 others who holding director position in Kesang Corporation Bhd ('KCB') for transfering a property owned by him to a third party without his concern. The property is an apartment in Tanjung Tuan Port Dickson which was bought from a company known as Tanjung Tuan Resort Development Sdn Bhd which then transferred to KCB and then to third parties. The plaintiff's claims against the second, third and fourth defendants have previously been withdrawn. Plaintiff claimed against the first defendant for damages for breach of fiduciary duty as a director of the plaintiff's company. The trial of the case began on 21 March 2005. While the present case of trial still ongoing, Plaintiff applied to obtain a leave of Bankruptcy to proceed against the first defendant pursuant to Bankruptcy Act 1967 on 23 January 2007 who had hear adjudged as bankrupt on 11 July 2005.The case call up for continued hearing on 30 March 2007. The first defendant counsel inform the court that he had applied to the Director General of Insolvency for sanction pursuant to s 38(1)(a) of the Bankruptcy Act to defend the action and to retain Messrs David Lingam & Co as his solicitors and Mr. David Lingam as his counsel. On 13 September 2007, Encik Zahari who represented the Director General of Insolvency and Encik Sadacharam Raman as amicus curiae applied for an adjournment for sanction pursuant to s 38(1)(a) of the Bankruptcy Act due to proper application for sanction was submitted late by first defendant. Secondly, the first defendant was unwell to attend court. The plaintiff learned counsel, Cik Tricia Mallika Appaduray, opposed the application for adjournment and directed the trial to proceed, however the trial as concluded and issued directions for the filing and serving of written submissions, and fixed 4 February 2008.Meanwhile, the receiving order and the adjudication order against the first defendant were annulled by the Bankruptcy Court on 15 November 2007. The first defendant reopened the case to cross-examine the plaintiff's witness namely Encik Uthaya Kumar a/l Marimuthu ('PW1) who was an assistant general manager, Legal Affairs of Damansara Realty Bhd's group of companies, a position which he holds since 1999 and also director of the plaintiff’s company since 1999. However, after considering submissions of parties, the judge disallowed the application due to the first defendant being absent on 13 September 2007 tendered medical certificates which seemed to not be a valid reason. Furthermore, the first defendant application was not made promptly where he ceased to be a bankrupt. On the other hand, the Plaintiff has no documents of title tendered to show that he was at the material time the registered owner of the apartments. Lastly, there is no strata title to show that the Tanjung Tuan Resort Development Sdn Bhd was the registered owner of the two apartments.
Issues of the Case 1. Plaintiff alleged the first defendant had caused the apartments in Tanjung Tuan Port Dickson which was bought from a company known as Tanjung Tuan Resort Development Sdn Bhd that it owned transferred to Kesang Corporation Bhd ('KCB') and then to third parties. Whether the first defendant is doing wrong towards third party? Whether third party is proper plaintiff? 2. The plaintiff's claim against the first defendant was for damages for breach of fiduciary duty as a director of the plaintiff's company. Whether liability towards another entity? Whether action commenced by wrong entity? 3. Indefeasibility of title tendered to show that the plaintiff is the registered owner of the apartments. There is no evidence to show that the Tanjung Tuan Resort Development Sdn Bhd was the registered owner of the two apartments. The plaintiff failed to prove his ownership towards the apartments. Whether could be deprived of something not owned? Whether claim valid?

Argument of Plaintiff
Plaintiff bought 2 apartments in Tanjung Tuan Port Dickson from a company known as Tanjung Tuan Resort Development Sdn Bhd. Plaintiff complained that the first defendant with three others whom are directors of Kesang Corporation Bhd (KCB), breached their fiduciary duty, by selling these 2 apartments to a third party without the Plaintiff's knowledge. Plaintiff launched a law suit against these 4 directors regarding the damages of the breach in fiduciary duty. The plaintiff's claims against the second, third and fourth defendants have previously been withdrawn. The case of the plaintiff's claim against the first defendant on the damages on the breach in fiduciary duty began on 21st March 2005. During the present case of trial was still ongoing first defendant was adjudged a bankrupt on 11 July 2005. Plaintiff applied to obtain leave of Bankruptcy to proceed against the first defendant pursuant to Bankruptcy Act 1967 on 23 January 2007. The receiving order and the order against the first defendant were annulled by the Bankruptcy Court on 15 November 2007. Subsequent, on 17 April 2008, the first defendant made an application by way of summons in chambers (encl 105) for the trial to be reopened. After considering submissions of parties, the judge disallowed the application which is favourable to plaintiff. From the plaintiff point he has one namely Encik Uthaya Kumar a/l Marimuthu ('PW1) who is assistant general manager, Legal Affairs of Damansara Realty Bhd's group of companies, a position which he holds since 1999 and also the director of the plaintiff since 1999. Besides that, the plaintiff claims:"Plaintiff is a legal owner of these treasures" means plaintiff was the registered owner of the apartments which bought from a company known as Tanjung Tuan Resort Development Sdn Bhd. The Plaintiff claimed the apartment was bought from a company known as Tanjung Tuan Resort Development Sdn Bhd. There is a sale and purchase document for both apartments to show plaintiff ownership of the apartments. Somehow this two sale & purchase original copy is missing from plaintiff instead he has a photocopy of these two agreements. The plaintiff argued to court, to admit the photocopy of these sale & purchase agreements, relying on s 65(1)(c) of the Evidence Act 1950 which states:
65 Cases in which secondary evidence relating to documents may be given. (1) Secondary evidence may be given of the existence, condition or contents of a document admissible in evidence in the following cases:
(c) When the original has been destroyed or lost, or when the party offering evidence of its contents cannot for any other reason not arising from his own default or neglect produce it in reasonable time.
In addition, he also largely relies on two sale and purchase agreements pertaining to the two apartments in order to show its 'ownership' of the apartments. Another piece of documentary evidence which the plaintiff relies upon to prove that it is the owner of the two apartments, that document is pp 79-9 of bundle B. This bundle is marked 'AGREED COMMON BUNDLE -- NORMAL'. This means parties had agreed that the maker of the documents in the Bundle need not be called to prove the admissibility of the documents. With these all supporting evidence plaintiff wish to win the case.

Argument by Defendant
The first defendant, Dato' Haji Mat Shah bin Ahmad defended the Plaintiff's claim against him for damages for breach of fiduciary duty as the director of the plaintiff's company had breached fiduciary duty, by selling 2 apartments which owned by the plaintiff to a third party without his concern is a not true. The case began on 21st March 2005 and during the present case of trial first defendant was adjudged a bankrupt on 11 July 2005. The plaintiff applied to obtain a leave of the Bankruptcy to proceed against the first defendant pursuant to Bankruptcy Act 1967 on 23 January 2007. On 13 September 2007, first defendant’s senior federal applied for an adjournment on the grounds that the first defendant was still awaiting the Director General of Insolvency's sanction, and, secondly, the first defendant was unwell to attend court by tendered a medical certificate as strong excuse for adjournment. The trial judge concluded and issued directions for the filing and serving of written submissions, and fixed 4 February 2008 as the date of decision. Meanwhile, the receiving order and the adjudication order against the first defendant were annulled by the Bankruptcy Court on 15 November 2007. As the receiving order and adjudication order against first defendant had been annulled by the Bankruptcy Court on 15 November 2007, the first defendant applied to reopen the case to cross-examine the plaintiff's witness and thereafter to present the defendant's case. Subsequent, on 17 April 2008, the first defendant made an application by way of summons in chambers (encl 105) for the trial to be reopened but he failed, judge disallowed the application. The defendant argued by giving the reason for delay on application. He said: “If there is any delay in making this application (the any doubt), it is due to the time taken by me to cancel Orders Received and Sentencing of and next I ordered my Solicitor to make this application”. Besides that, the first defendant objected to the acceptability of sale & purchase agreement shown as proved by plaintiff as the ownership the apartment is the ground that it is merely a photocopy. PW1 should have produced the original sale and purchase agreement. As a general rule, documents must be proved by primary evidence.
Section 64 of the Evidence Act 1950 stipulates: 64 Proof of documents by primary evidence. Documents must be proved by primary evidence except in the cases hereinafter mentioned.
First defendant claims the real complaint of the plaintiff lies in the alleged transfer of the two apartments to third parties. But the alleged transfer of the two apartments to the third parties was allegedly done by Kesang Corporation Bhd and not by the first.

Opinion & Decision by the Judge
The first defendant was adjudged a bankrupt on 11 July 2005 and plaintiff applied for obtained leave of the Bankruptcy to proceed against the first defendant pursuant to Bankruptcy Act 1967. First defendant counsel had applied to the Director General of Insolvency for sanction pursuant to s 38(1)(a) of the Bankruptcy Act to defend the action. Director General of Insolvency disclosed to the court that the proper application for sanction was submitted late which is three days before trial and so applied for an adjournment on the grounds that the first defendant was still awaiting the Director General of Insolvency's sanction and secondly, the first defendant was unwell to attend court. Judge concluded the trail and issued directions for the filing and serving of written submissions, and fixed 4 February 2008 as the date of decision. Meanwhile, the receiving order and the adjudication order against the first defendant were annulled by the Bankruptcy Court on 15 November 2007. Subsequent, on 17 April 2008, the first defendant made an application by way of summons in chambers (encl 105) for the trial to be reopened and that the first defendant be given the opportunity to further cross-examine the plaintiff's witness PW1.However, after considering submissions of parties, judge disallowed the application due to below reason: 1. The first defendant absent on 13 September 2007 tendered medical certificates which seem not a valid reason. i. Medical certificate tendered through counsel, Mr Sadacharam Raman, who appeared as amicus curiae which is unacceptable rather than through senior federal counsel who represented the Director General of Insolvency. ii. The nature of first defendant's alleged illness was not clear in medical certificate. iii. Doctor was not call to explain he’s fitness condition as a reason for not attending the court. iv. The first defendant’ s medical certificate did not mention he is not fit to attend court: for limb (c) of the medical certificate merely says:“(c) He is not fit to carry out his duties properly on / from 12/9/07 to 13/9/07 for (two) days” 2. The sickness was not specified clearly in medical certified which tendered by the first defendant. 3. Apart from that, previously the first defendant had absented himself from court on three occasions without a valid reason, although in respect of each of the occasions he had been previously informed in writing by the court to attend the court proceedings. 4. First defendant ceased to be a bankrupt on 15 November 2007 yet the present application was not made by the first defendant promptly where it made on 17 April 2008 without satisfactory explanation for this long delay in filing encl 105. 5. The reason for delay is given by first defendant is “time taken to cancel Orders Received and Sentencing and to make this application to re-open the case to cross examine plaintiff” which is not acceptable because he obtained the annulment order from the Bankruptcy Court as early as 15 November 2007 yet the present application was not made promptly. 6. Judgment on a similar scenario on Court of Appeal in Tan Kah Kiam v Liew Chin Chuan & Anor [2007] 2 MLJ 445; [2006] 4 CLJ 715 . In this case, Gopal Sri Ram JCA, in delivering the judgment of the court of appeal, states (p 452 (MLJ)):
“For temporally speaking, whether the trial judge may exercise his Discretion to permit the reopening of a party's case will very much depend on the stage at which the application is made. It may be more likely that discretion may be exercised at the stage where the application is made immediately after a party closes its case. But it may be less likely that a discretion will be favorably exercised where the application is made after the defendants have closed their case and just before the trial judge is about to pronounce his judgment. In the spectrum of factual possibilities that exist between each of these two extremes the exercise of discretion would, in my judgment, very much depend as to where the justice of the case lies having regard to the peculiar facts and circumstances before the court” 7. First defendant uncooperative and had never presented himself at the senior federal counsel's office to discuss on sanction application. The proper application for sanction was submitted to Director General of Insolvency very late, on 10 September 2007, just three days before the trial continuation date of 13 September 2007 after a reminder had been sent by the director general to the first defendant's solicitors. On top of that, the senior federal counsel added that apart from the pleadings he did not have with him the full set of documents pertaining to the case. 8. Once judge disallowed the first defendant's application to reopen the trial, recognizing the fact that the first defendant had now ceased to be a bankrupt, Judge had also fixed a new decision date that is 9 January 2009. On 9 January 2009 judge dismissed the plaintiff's claim against the first defendant with costs. Below are the facts on judge judgment: i. The evidence is weak and failed to prove its case against the first defendant which plaintiff called only one witness ('PW1) who has no personal knowledge of the alleged events and transactions that took place in 1992 involving the properties in question where he merely relied on documents which inadmissible or of no probative value. ii. Plaintiff has no documents of title tendered to show that he was at the material time the registered owner of the apartments. iii. Tanjung Tuan Resort Development Sdn Bhd ('Tanjung Tuan Resort') was not the registered owner of the two apartments there is no strata titles were tendered by the plaintiff to show that Tanjung Tuan Resort Development Sdn Bhd was the registered owner of the two apartments. iv. There is a sales and purchasing document for both apartments to show plaintiff ownership of the apartments. Somehow, Plaintiff has failed to prove that the original copy was missing or that reasonable efforts had been taken by the plaintiff to obtain the original copy. v. There is another piece document plaintiff claim for ownership is pp 79-9 of bundle B. This bundle is marked 'AGREED COMMON BUNDLE -- NORMAL' which means parties had agreed that the maker of the documents in the Bundle need not be called to prove the admissibility of the documents, but the contents of the documents are disputed (not clear cut). This document has no evidence to who had prepared this document and as to the purpose of the document.
Opinion
In my point of view, I agree that the judgment and the opinions of the judge on the argument are reasonable. These for the reason of the evidences are weak and are not sufficient to prove the case against the first defendant. As claimed by the plaintiff, it owned the two apartments and the first defendant have unlawfully transferred to third party. Though the plaintiff was the registered owner of the apartments, there are no documents of title tendered showing the register owner of the apartment. The plaintiff is mainly entrusting on two sale and purchase agreements pertaining to the two apartments to prove its ownership.
Besides that, the documentary evidence marked as exh P2 (sale and purchase agreement between the plaintiff and Tanjung Tuan Resort in respect of the apartment having the address A10-4) is only a photocopy and there is no evidence as to who had made the photocopy. In view of the fact that the original copy of the sale and purchase agreement could not be found and details such as who made the photocopy, where the copy of the document was found and who gave the copy to him (PW1) is unexplained also, the date of agreement is left blank. These issues are considered weird as the actual date of agreement was executed is unknown. The plaintiff called only one person to witness the original copy has gone missing which is not sufficient evidence. This is because, no other officer involved in the search for the original document was called by the plaintiff to endow details of the alleged efforts taken by the plaintiff to trace or to retrieve the original copy.
The plaintiff should have at least called the officer who is in picture being responsibility over the custody of such an important document to explain how the original document went missing. Instead the PW1 only gives a general statement saying that a search has been carried out by the company staff on files and cabinets, however was failed to locate the document. Furthermore, Tanjung Tuan Resort was the vendor of the A10-4 apartment, as alleged by the plaintiff, then that company would also have in its possession a copy of the original copy of the sale and purchase agreement. Nonetheless, there was no evidence showing that the plaintiff had tried contacting Tanjung Tuan Resort to obtain from that company a copy of the original. In a nutshell, the plaintiff has not taken enough effort to obtain the original copy and have unsuccessful to prove that the original was missing.
Moving on to the second alleged sale and purchase agreement marked as exh ID3 (Purchase agreement is in respect of the other Tanjung Tuan apartment with the address A5-4). Similar to the exh P2, this alleged sale and purchase agreement is equally weird. It does not have a date of its execution and are merely a photocopy document. The plaintiff has also not provided with good reason as to why the original copy of the sale and purchase agreement could not be obtained from the Bank of Commerce. To conclude, the plaintiff has failed to prove its ownership of the both apartments.However, there is another documentary that could support and prove the ownership of the apartment which is the pp 79-9 of bundle B. This document has the date of the purchase written for both the apartments but was not stated who the vendor/vendors was/were. The document also does not mention was prepared by whom and the purpose it was created. Therefore, the documents are considered as insufficient to prove that the plaintiff was the owner of the apartments.
In a word, based on the given statement, the actual complaint of the plaintiff lies in the alleged transfer of the two apartments to third parties but the supposed transfer of the two apartments to the third parties was done by a body known as Kesang Corporation Bhd and not by the first defendant and they were transferred by Kesang Corporation Bhd to the third parties only after they had been transferred to Kesang Corporation Bhd from the plaintiff company allegedly by the defendant. I strongly believe after examining closely the statement of claim, the subject of matter is not the plaintiff’s complaint. It is the alleged transfer of the two apartments to the third parties was allegedly a wrongdoing by the first defendant in cahoot with the other defendants, by virtue of their position as ,directors of Kesang Corporation Bhd, then it is a wrongdoing by the first defendant to Kesang Corporation Bhd and not to the plaintiff (Kesang Leasing Sdn Bhd). Kesang Corporation Bhd should have been the plaintiff in the present case, and not Kesang Leasing Sdn Bhd. By this I conclude that I agree with the judge’s judgment, which is to reject the Plaintiff’s claim and fining the Plaintiff with cost.

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...1. Easy Groceries Pty Ltd: the Company Issue The issue here is Easy Groceries Pty Ltd is liable for the debts incurred as a separate legal entity to its directors and shareholders? Or will its directors be personally liable for its debts? Law Upon incorporation, a company becomes a separate legal entity from its directors and members (s119). It can sue and be sued, acquire assets and debts, and enter into contracts in its own name. Its existence can lasts a lifetime as well. The Doctrine of Separate Legal Entity also known as “corporate veil” entails that the Directors of a Company have no personal liability while its Shareholders are only liable up to the amount they paid for their shares. In Salomon v Salomon & Co Ltd Case, Mr. Salomon was the majority shareholder and a secured creditor of the company. Upon winding up, the liquidators argued that Mr. Salomon must not be considered as a secured creditor since he was in control of the company itself. But the Court’s decision recognized Mr. Salomon as a secured creditor since the company has a separate legal personality from the directors and shareholder upon its registration and it has nothing to do with Mr. Salomon being a secured creditor. Application Applying s119 corporations act, Easy Groceries Pty Ltd is a separate legal entity from its directors and shareholders, meaning that Easy Groceries Pty Ltd as a company itself is liable for the debts that occurred. Conclusion As an own legal entity...

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Company Law

...‘Directors duties occupy a strange position in company law. They must be sufficiently strong so as to keep directors in line but sufficiently weak to allow directors to take risks. It is no wonder the courts can’t enforce them properly.’ Do you agree with the above statement? By any measure the 2006 Act is a momentous and monumental piece of legislation. The largest statute ever enacted by the Westminster Parliament, it has engineered the modernisation, consolidation and codification of the vast panoply of UK company law. The Act subsumed the compendious 1985 Companies Act, and the Companies Act 1989.The modernisation of UK company law necessitated reform, redrafting and reorganisation in many fields. The law relating to directors’ duties received particular attention. Indeed, it is submitted that the reforms made in the context of the law on directors’ duties constitute some of the most important and valuable innovations incorporated in the new Act. Under s.171 CA 2006 a director must act in accordance with the company’s constitution and only exercise powers for the purposes for which they are conferred. This was formerly known in the case law as the proper purpose rule. In the case of Hogg v Cramphorn Ltd the principle found was that it was not enough that the directors issued the shares in the honest belief that it was in the best interest of the company. Hence the power must have been exercised for its proper purpose. In Howard Smith Ltd v Ampol Petroleum Ltd the Supreme...

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Company Law

...they have been the victim of wrongdoing by those in a ‘majority’……….…………………...Pg 7 & 8 References………………………………………………………………………………………………………………….Pg 9 & 10 Introduction of the Case of Foss v. Harbottle The Victoria Park Company is a company had been established during September 1835. This company is to establish a residential area for the prosperous business and professional families to stay. This estate will be established to the east of Wilmslow Road. Richard Foss and Edward Starkie are the minority shareholders. A bill was lodged by 2 shareholders of the company that incorporated by Art of Parliament, on their own and the other shareholders’ behalf. In the case they claim that fraudulent transactions misapplying the company’s assets did by 3 bankruptcy directors, a solicitor, proprietor and architect, and take some unqualified people to put in board of director to make it full and a company without clerk or office, in this situation the proprietors has no rights to take out the property from the hand of defendant directors. Observations were made on this point of case is that the trust between the company and company promoters had arises. Void transaction is not necessarily to be created by the possible of avoiding a transaction. A company can select to apply the transaction later and hold the directors bound by them. If the act is given the power that authorized the transaction on mortgage then they can be confirmed. Although this act is the act beyond the power...

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