ALI SAID HAMDAN AL RAWAHI v AHMAD BIN HASSAN

Case Significance

Illustrates the deference owed to a trial court's credibility-based findings on appeal, and the distinction between a claim on a share purchase agreement made with a company and a claim against the individual behind it — the former lying against the company, not the shareholder personally.

This decision of the High Court of Malaya at Shah Alam concerns an appeal from a Sessions Court judgment that had dismissed, after a full trial, the plaintiff's claim against the defendant. The appellant, a citizen of Oman, had invested RM960,000 in a company, Bidara Flour Sdn Bhd, under a Share Purchase Agreement dated 28 July 2016 that entitled him to hold 48% of the company's ordinary shares; the payment was made into the company's account and he was appointed a director. In March 2022 he discovered, through a Companies Commission of Malaysia (SSM) search, that his shareholding had been reduced to 32% while the respondent's had increased to 68%, and he alleged that this reduction had occurred without his knowledge or consent and that the respondent had fraudulently misrepresented his entitlement.

On appeal the High Court applied the settled principle that findings of fact based on the credibility of witnesses should not be disturbed unless plainly wrong. It held that the Sessions Court had been entitled to prefer the respondent's evidence, including on the disputed documents — the court noting that the appellant's practice of signing documents overseas and returning them by email meant there was no conclusive proof that the relevant documents had not been executed in the usual way. Crucially, the Share Purchase Agreement was between the appellant and the company, not the respondent personally, and the appellant had paid the money into the company's account and acquired his shares through the company's share register; any claim arising from that agreement therefore lay properly against the company rather than the respondent. Finding no plainly wrong finding and no miscarriage of justice warranting appellate intervention, the court dismissed the appeal with costs of RM10,000. The judgment illustrates both the deference owed to a trial court's credibility findings and the distinction between a claim against a company and a claim against an individual behind it.