Tay Bok Choon v Tahansan Sdn. Bhd
| Jurisdiction | UK Non-devolved |
| Judgment Date | 1987 |
| Date | 1987 |
| Court | Privy Council |
Company - Winding up - “Just and equitable” grounds for - Petitioner purchasing shares in company - Agreement that petitioner to participate in management of company - Petitioner excluded from management - Whether just and equitable to wind up - Parties relying on affidavit evidence - Whether court having power to order examination of deponents -
The company was incorporated in Malaysia with four equal shareholders who were appointed directors. During negotiations for the transfer of the shares of one of the shareholders to the petitioner, for which under the articles of association approval of the directors was required, it was agreed between the petitioner and the directors that he would be appointed a director and chairman of the board. After the transfer he became a director and he contributed further capital to the company. Together with the other shareholders he guaranteed the liabilities of the company to a finance company, and he lent substantial sums to two of the shareholders. He became chairman of the board, but subsequently against his wishes the board transferred all the executive powers of the directors to a managing director. The petitioner was removed from office as a director and chairman. He presented a petition to the High Court in Malaya for the winding up of the company. In accordance with the proper procedure affidavits were sworn and filed on behalf of the petitioner, and in opposition to the petition on behalf of the company, but neither party called oral evidence or applied to cross-examine the deponents. The judge held that it was just and equitable that the company be wound up and he made a winding up order pursuant to section 218(1)(i) of the Companies Act 1965.F1 The Federal Court of Malaysia allowed the company's appeal holding that, even though no application had been made, Ord. 38, r. 2(3) of the Rules of the High Court 1980F2 gave the court power to examine the deponents and the judge should have done so.
On the petitioner's appeal to the Judicial Committee:—
Held, allowing the appeal, that in the absence of an application by a litigant a trial judge in civil proceedings had no power to give directions with regard to the evidence to be presented, and it was for the judge to decide the petition on the affidavit evidence disregarding allegations made in the petitioner's affidavits which had been credibly denied in the company's affidavits; that the undisputed facts established that even if no express assurance had been given the petitioner had been led to expect that he would be entitled to participate in the management of the company and that he would be a director so long as he held a quarter of the company's shares, and that the other shareholders were under an obligation to allow him to be on the board and to participate in management unless there were good reasons for his removal; and that, therefore, since he had been removed without due cause the judge had properly decided that in all the circumstances it was just and equitable to wind up the company (post, pp. 417G–418A, G–H, 419A–C).
Per curiam. A judge may indicate to a petitioner that unless he calls oral evidence or applies to cross-examine the deponents of the opposition so as to prove a disputed fact, his petition is likely to fail. The judge may equally indicate to a respondent that unless he calls oral evidence or applies to cross-examine the petitioner's deponents for the purposes of disproving an allegation made by the petitioner, then the petitioner is likely to succeed. (post, pp. 418H–419A).
The following case is referred to in the judgment of their Lordships:
Westbourne Galleries Ltd., In re [
The following additional cases were cited in argument:
A.B.C. Coupler and Engineering Co. Ltd., In re [
Eng Mee Yong v. Letchumanan s/o Velayutham [
Fildes Bros. Ltd., In re [
Haron bin Mohammed Zaid v. Central Securities (Holdings) Bhd. [
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