ENERGY EQUIPMENT TECH SDN BHD v STRIKE MARINE (M) SDN BHD

Case Significance

Illustrates that a Fortuna injunction will not restrain a winding-up petition where the debtor has not genuinely disputed the debt when it fell due — non-response to invoices and demand letters, against an entire-agreement clause, pointing to an afterthought rather than a substantial dispute.

This decision of the High Court's Commercial Division in Kuala Lumpur concerns a further application by the same construction company for a Fortuna injunction to restrain a different subcontractor from proceeding with winding-up proceedings. As in the related matter, the plaintiff had engaged the defendant to provide marine services on an offshore project under time charter agreements, and the defendant had served a statutory notice under sections 465(1)(e) and 466(1)(a) of the Companies Act 2016 demanding a substantial sum. The plaintiff sought to restrain any winding up on the footing that the debt was bona fide disputed on substantial grounds and that it was solvent. The court applied the settled principles governing Fortuna injunctions, under which such relief is confined to cases where a winding-up petition would be an abuse of process — because the debt is genuinely disputed on substantial grounds or the petition is otherwise bound to fail. Construing the contractual documents, including a Letter of Assurance and an entire-agreement clause that permitted no variation save by written amendment, the court held that the assurance did not relieve the plaintiff of its obligations to the defendant. It attached significance to the plaintiff's failure to dispute the invoices when they were rendered and its non-response to the demand letters in a commercial context, treating the later allegations as an afterthought inconsistent with the contemporary documents. The court concluded that the plaintiff had wholly failed to establish a bona fide dispute on substantial grounds, that the intended petition was not bound to fail, and that the plaintiff had not demonstrated genuine solvency or any irreparable damage that could not be avoided simply by paying the admitted debt. It accordingly dismissed the application. The judgment illustrates that a Fortuna injunction will not be granted to a debtor that has not genuinely disputed the debt when it fell due.