SKN Land & Development Sdn Bhd v Chan Siew Mei (Penyelesai Crest Worldwide Resources Sdn Bhd)

Case Significance

Illustrates the threshold for the first stage of committal proceedings against a liquidator, the duty to obey a court order until it is set aside, and the court's power to find a prima facie case of contempt independently of an earlier ex parte leave order that had been set aside.

This High Court decision in the Commercial Division at Kuala Lumpur concerns an application by SKN Land & Development Sdn Bhd for leave to file a notice of motion in the Court of Appeal seeking leave to commence committal proceedings against the respondent, the liquidator of Crest Worldwide Resources Sdn Bhd (in liquidation). The alleged contempt was that the liquidator had breached a Court of Appeal stay order dated 15 March 2024 made in a related "Termination Appeal", by filing what the judgment calls the "Impugned Motion". The matter engaged Article 126 of the Federal Constitution, section 13 of the Courts of Judicature Act 1964 and section 486 of the Companies Act 2016, and required the Court to consider whether leave is required before proceedings are commenced against a liquidator and whether the alleged conduct disclosed a prima facie case of contempt.

The Court reviewed the sequence of events. The Court of Appeal (described as "CA Panel 1") had earlier granted the applicant an ex parte leave order for committal on the footing that the filing of the Impugned Motion breached the stay order; a differently constituted Court of Appeal ("CA Panel 2") then set aside that ex parte leave order. The Court held that it remained free to make its own independent assessment: an interim order, once granted, must be obeyed unless and until set aside, and if a party considers that an order ought not to have been made the proper course is to apply to vary or set it aside, not to disregard it.

Making its own evaluation, the Court found a prima facie case of contempt — that the Impugned Motion had been filed in wilful disregard of the stay order — which was sufficient to allow the application. It accordingly granted prayer 1 of the application, with costs of RM15,000 subject to allocatur. The judgment is a useful illustration of the threshold for the first stage of committal proceedings against a liquidator, the requirement to obey a court order until it is set aside, and the court's power to make an independent finding of a prima facie case of contempt even after an earlier ex parte leave order has been set aside.