NEO ALCHEMY BUILD INDIA LLP v 1. ) KAH GLOVE SDN BHD 2. ) TAH KOK HUA @ KEN 3. ) CHA WEI WEI @ VIVIAN 4. ) ANG SOON THYE

Case Significance

Illustrates findings of breach, fraud, and conspiracy in a pandemic-era glove-supply dispute, with the corporate veil lifted to fix the instrument of the fraud with personal liability and the defendants' counterclaims dismissed.

This High Court decision at Shah Alam resolves, after trial, a claim for breach of contract, fraud, and conspiracy to injure arising from the supply of disposable gloves during the Covid-19 pandemic. The plaintiff, an Indian company, had sourced large quantities of latex and nitrile gloves from Malaysia to meet a surge in demand, and sued the corporate supplier and three individuals to recover over a million US dollars in special damages, together with general, aggravated, and exemplary damages, alleging that it had not been supplied with the gloves it had ordered. The case exposed a trade in recycled or used gloves, whereby single-use gloves were collected, washed, repackaged, and resold through a web of agents and distributors.

The court examined whether the plaintiff had received what it ordered, whether the defendants had perpetrated a fraud, whether there was a conspiracy between them, and whether the corporate veil should be lifted to fix an individual with personal liability. It found that the supplier company had breached the contract and that a fraud had been perpetrated, and it was prepared to lift the corporate veil against the individual who had been the instrument of that fraud, holding him personally liable. On the tort of deceit and the conspiracy to injure, the court found for the plaintiff against the supplier company and the individual defendants involved.

On the defendants' counterclaim, the court dismissed the claim for the balance payment on the shipments that were never shipped, since no case had been put that those shipments contained gloves of the specification ordered, and it dismissed the claim by two of the individuals for commissions, holding that they had neither pleaded nor proved any basis for recovering commissions and had more probably taken their cut from the sums paid by the plaintiff. The judgment is a detailed illustration of fraud, conspiracy, and the lifting of the corporate veil in a pandemic-era glove-supply dispute.