Judgment

Abdul Malek Ahmad FCJ

(delivering the judgment of the court)

1. This is an appeal from the decision of the Court of Appeal on June 5, 1995 dismissing with costs the appellant's appeal from the decision of the High Court on September 1994.[a] Learned counsel for the appellant started off her submissions by raising a preliminary objection as regards the cross appeal as there had been no application for leave to do so although she had been served with the notice of cross appeal dated November 11, 1995.

2. The response from learned counsel for the respondent was that he was totally unaware of the situation as he had just been retained the day before. As such, he was not in a position to argue except to say that he was ready to proceed and that the circular from the Court of Appeal stated that no leave was necessary.

3. Learned counsel for the appellant's reply was that on the previous hearing date on January 19, 1998, the previous solicitors for the respondent had been discharged by the respondent who had been ordered to pay RM1,000 costs for the adjournment which were yet to be paid.

4. Since no leave to file a cross appeal was obtained when leave to file the appeal was given on September 12, 1995, we were of the unanimous view that the cross appeal should be, and was accordingly, struck out with costs.

5. In the High Court, the appellant was the petitioner and they had on January 17, 1994 been granted an order in terms to wind up the respondent because neither the respondent nor their counsel was present. On June 10, 1994, the respondent had applied for leave for extension of time to file the application and to set aside the default order made on January 17, 1994.

6. The learned High Court Judge was satisfied that the respondent had filed the application within the time specified by the Rules of the High Court 1980. The mistake, he concluded, was that of the court registry.

7. As for the setting aside, the learned High Court Judge agreed with the contention of the then learned counsel for the respondent on the ground that the words in the statutory notice dated the October 25, 1991 namely "interest of $64.69 per day from 26.10.1991 till date of full settlement" made it defective as a result of the ambiguity. The learned High Court Judge held that it was not a mere irregularity which could be cured relying on Fawzia Osman v BBMB [1991] 1 MLJ426, Low Mun v Chung Khiaw Bank Ltd [1988] 1 MLJ 263, Lim Boon Peng v United Orient Leasing Co Bhd [1991] 1 MLJ 292 and distinguishing the facts in Sri Hartamas Development Sdn Bhd v MBf Finance Bhd [1991] 3 MLJ 325.

8. In the Court of Appeal, a strong Bench comprising Shaik Daud Ismail, Gopal Sri Ram and Siti Norma Yaakob, JJCA, said through the presiding Judge as follows:

   With respect, I am of the view that the learned Judge ought not to apply principles enunciated in bankruptcy cases, in cases of winding up. Bankruptcy cases are governed by their own Act and company winding-up cases are governed by an entirely different set of Act(s) and regulations. While it cannot be gainsaid that the liquidation or winding-up of a company has certain obvious affinities with the bankruptcy of an individual the courts should be careful not to stretch these affinities to such an extent that they lose sight of the fact that they may fall in danger of applying the law of bankruptcy to company winding-up proceedings. It must be remembered that in a winding-up proceeding there is nothing corresponding to an act of bankruptcy. In my view it is because of this aspect of this act of bankruptcy that the courts adopt a strict view in construing a bankruptcy notice. As a result of the Supreme Court decision in Fawzia, s 3(1)(i) of the Bankruptcy Act 1967 was amended by Act A 827 with effect from July 16, 1992 to include the phrase "with interest quantified up to the date of issue of the Bankruptcy Notice." With this amendment the ambiguity and uncertainty earlier encountered by creditors came to an end.

9. In a subsequent paragraph, the judgment states:

   It is my view that the demand stipulated in the Companies Act 1965 is merely a warning to the creditor that if after three weeks he fails to pay, a winding-up petition would follow. Therefore the demand need not exactly quantify the amount unlike in the bankruptcy notice. Unlike a bankruptcy notice there is no prescribed form of the statutory demand or notice as the whole object of the demand is to warn the debtor of an impending petition. (See Bateman Television Ltd v Coleridge Finance Co Ltd (1969) NZLR 794 at 803) The failure to quantify does not render the demand of its real purport and objective. The provisions of 218(2)(a) prescribe a simple method of which a creditor, to whom the company owes more than five hundred ringgit, can establish that the company is unable to pay its debts. In order for the demand to be effective, however, it must comply strictly with certain requirements as stipulated in the sub-section itself. The requirements are that the demand must be in writing under the hand of the creditor or his authorised agent, it must specify the sum due (no mention is made of quantifying it to the last cent). The demand must be served on the company by leaving it at the registered office. If these requirements are met, I am of the view that the demand is valid and if after three weeks the company fails to pay the amount demanded then the law deems it to be unable to pay its debts whereupon a winding-up petition would follow.

10. We agree with the views expressed by the Court of Appeal on this point. They would then have allowed the appeal but for another issue raised by learned counsel for the respondent which was not raised in the High Court.

11. The additional point was on the irregularity of the service of the winding up petition having regard to Rule 25(1) of the Companies (Winding-up Rules) 1972 ("the Rules"). Rule 25(1) provides, inter alia, that every petition to wind up a company shall be served upon the company at the registered office of the company, and if there is no registered office, then by leaving a copy with any member, officer, or servant of the company at the principal or last known principal place of business of the company, or if no such member, officer or servant can be found there, then by leaving a copy at the registered office or principal place of business.

12. Learned counsel for the respondent submitted that where the law had provided a special mode of service, that must be complied with failing which service would not be deemed to have been effected. It was held in PT Pelajaran Nasional Indonesia v Joo Seang & Co Ltd [1958] 24 MLJ 113 that as the writ had not been served on the company at its registered office as required by the law, the service was held to be bad and the judgment in default was set aside.

13. We now turn to the facts of the present appeal relating to the issue of service. This is what the Court of Appeal said:

    In the present case there is no dispute that the petition was served at 48 Rangoon Road, Penang on a Chinese person found thereat. According to the affidavit of one Chow Yen Kong the Manager of S & C Management Services Sdn Bhd dated July 4, 1994, who had been the secretaries for the respondent company since June 1985, the company had moved out of the old registered address at 48 Rangoon Road Penang in late April 1991 to its new address at 731 Dato Keramat Road, Penang, and the notice of this change dated December 31, 1991 was lodged with the Registrar of Companies on February 1, 1992. In the light of this it is contended that the service of the petition on February 26, 1992 at the respondent's old registered address was bad in law. No affidavit was filed to contradict this. In reply to this learned counsel for the appellant submits that an official search was made on January 29, 1992 and the registered address of the respondent was at 48 Rangoon Road and hence service was affected at that address. Therefore the service was good. In response to this learned counsel for the respondent refers the court to the case of Summit Company (M) Sdn Bhd v Nokko Products (M) Sdn Bhd [1985] 1 MLJ 68. In that case the appellant purported to serve a writ on July 1, 1982 on the respondent company at an address which they believed to be the registered address of the company. The respondent company had in fact changed its registered address and the change had been notified to the Registrar of Companies on February 20, 1982. The notification of change was not, however, entered into the register until September 24, 1992. When no appearance was entered to the writ the appellants obtained judgment in default and execution proceedings were taken. The respondents when they came to know of the writ subsequently applied to have the writ set aside. The High Court gave judgment for the respondent. On appeal the then Federal Court held that the effective date of the change of the registered address is the date of the judgment of the notice to the Registrar of Companies, and the court held that the learned Judge was correct in holding that there had been no service of the writ and set aside the judgment. The facts of the Summit case is similar to the present case. The notice of change was lodged with the Registrar of Companies on February 1, 1992 and service of the Petition was on February 26, 1992 at the old address. There was no affidavit filed on behalf of the appellant to contradict the date of the judgment. Therefore following the decision in the Summit case, and this court is bound by that case, service of the petition on the old address on February 26, 1992 must be bad in law. The fact that the particulars of the change had not been entered in the register is no concern of the respondent and is irrelevant. Once the notice of change under s 120 of the Companies Act 1965 had been lodged this should be the effective date even though the notification of the change is entered in the register much later. In the circumstances of this case I hold that the service of the petition on the respondent company is bad in law. For this reason which reason was never considered by the learned Judge and for the earlier reasons pertaining to the statutory demand I would dismiss the appeal with costs. Deposit to go towards taxed costs.

14. The appellant referred us to the statutory declaration dated October 28, 1991 of the court clerk of a legal firm in Penang affirming that he had served the notice pursuant to s 218 of the Companies Act 1965 issued on October 25, 1991 on the respondent at their registered office at the ground floor of 48 Rangoon Road, Penang on October 25, 1991 itself.

15. Also, the relevant process server working for the appellant had deposed in his affidavit of service dated March 18, 1992 that on Wednesday, February 26, 1992 at 11.45 a.m., he had left an affidavit and a copy of the sealed petition, both dated December 31, 1991, on the desk in the respondent's registered office at the ground floor of 48 Rangoon Road, Penang in the presence of the respondent's Chinese clerk. In another paragraph, he had averred that a search had been made at the office of the Registrar of Companies on January 29, 1992 which showed that the respondent's registered address was indeed at the ground floor of 48 Rangoon Road, Penang since January 24, 1990.

16. Apart from that, the appellant tendered the details of the official search with the Registrar of Companies dated February 29, 1992, which listed details updated to January 24, 1990, stating that the respondent's registered address was at the ground floor of 48 Rangoon Road, Penang.

17. The respondent, on the other hand, tendered the affidavit dated July 4, 1994 of Chow Yen Kong (hereinafter "Chow") the manager of the S & C Management Services Sdn Bhd, the secretary for the respondent, denying that the statutory notice and the petition had ever been served on the respondent as they had moved out completely from that address in or about late April 1991.

18. Chow had attached to his affidavit the "notice of situation of registered office and of office hours and particulars of changes" in Form 44 which showed that the respondent had on December 31, 1991 moved from the ground floor of 48 Rangoon Road, Penang to the ground floor of 731 Dato Keramat Road, Penang. As for the official search, learned counsel for the respondent argued that the details therein were the documents registered and not the documents lodged relying on Summit Co (M) Sdn Bhd v Nokko Products (M) Sdn Bhd (supra) where this court decided that the effective date of the change of the registered address is the date of the lodgment of the notice to the Registrar of Companies.

19. He had also exhibited the receipt from the Registrar of Companies wherein certain relevant details could not be read clearly and this, in a surprising turn of events at the adjourned hearing, became the deciding factor when it came to making our decision. We had adjourned the case to another date when learned counsel for the respondent offered to either produce the original of that receipt or bring the records of the Court of Appeal. We opted for the former because the latter would not solve the problem since the photocopy of the receipt in the Court of Appeal records would be equally indecipherable.

20. All along, we were quite inclined to agree with the finding of the Court of Appeal. But on the original receipt being produced by learned counsel for the respondent at the adjourned hearing, to say we were quite shocked would be an understatement.

21. The original receipt C 090558 and the photocopy are reproduced below to show the differences we found between the two:

    URUSAN SERI PADUKA BAGINDA RESIT ASAL NAMA ALAMAT ...................................................... S & C MGT. SVCS. SDN. BHD. 731 DATO KERAMAT ROAD, 10460 PENANG. Jika tidak sampai kembalikan kepada: Pendaftar Syarikat, Pejabat Pendaftar Syarikat, Kuala Lumpur, Malaysia Pendaftar Syarikat Malaysia Kuala Lumpur (P.S.1-Pin. 1/87) RESIT Kerana: PSM P.PINANG 01/02/92 015409*1 082329T 008085X 01 AC090558 04 ******$100.00 PO C 090558 Akuan Terima Wang akan dicap disini dengan mesin Terima Wang Pejabat ini dan jika tiada bercap demikian maka pembayaran tidaklah diakui. PANDUAN BUTIR-BUTIR PEMBAYARAN Kod Bayaran Tunai Kod Bayaran Cek Bayaran Bagi 01 16 Borang Berkanun Syarikat Tempatan. 02 17 Borang Berkanun Syarikat Asing. 03 18 Modal yang Dibenarkan. 04 19 Penyata Tahunan. 05 20 Permohonan Mencari / Menyimpan Nama / Lanjutan Masa Menyimpan Nama 06 21 Permohonan Lanjutan Masa bagi Kira-kira / Mesyuarat Agung. 07 22 Pemeriksaan Fail Syarikat. 08 23 Denda / Bayaran Lewat. 09 24 Perusahaan Sekuriti. 10 25 Bayaran Fotostat. 11 26 Lain-lain Bayaran. Kebenaran Perbendaharaan bil YSPK (8.15) 248-10 (SK.4)Jld. 3/(8) bertarikh 12hb April, 1979 P-J.P.N., K.L.

     

    ---

     

    URUSAN SERI PADUKA BAGINDA RESIT ASAL NAMA ............................. ALAMAT (indecipherable) Jika tidak sampai kembalikan kepada: Pendaftar Syarikat, Pejabat Pendaftar Syarikat, Kuala Lumpur, Malaysia   Richland Trade & Dev. S/B Annual Return $50.00 (handwritten) Certified True Copy (Sgd) Secretary LS 0093 (P.S. 1-Pin.1/87) Pendaftar Syarikat Malaysia Kuala Lumpur RESIT Kerana: (indecipherable) C 090558 (indecipherable) Akuan Terima Wang akan dicap di sini dengan mesin Terima Wang Pejabat ini dan jika tiada bercap demikian maka pembayaran tidaklah diakui. PANDUAN BUTIR-BUTIR PEMBAYARAN Kod Bayaran Tunai Kod Bayaran Cek Bayaran Bagi 01 16 Borang Berkanun Syarikat Tempatan. 02 17 Borang Berkanun Syarikat Asing 03 18 Modal yang Dibenarkan 04 29 Penyata Tahunan 05 20 Permohonan Mencari / Menyimpan Nama / Lanjutan Masa Menyimpan Nama 06 21 Permohonan Lanjutan Masa bagi Kira-kira / Mesyuarat Agung. 07 22 Pemeriksaan Fail Syarikat. 08 23 Denda/Bayaran Lewat. 09 24 Perusahaan Sekuriti. 10 25 Bayaran Fotostat. 11 26 Lain-lain Bayaran.

    Kebenaran Perbendaharaan bil YSPK (8.15) 248-10 (SK.4)Jld. 3/(8) bertarikh 12hb April, 1979 P-J.P.N., K.L.

22. In the photocopy, the machine printed details for the name and address are not very clear and the machine printed words at the centre cannot be deciphered. In the original, the name and address are "S & C Mgt Svsc Sdn Bhd., 731 Dato Keramat Road, 10460 Penang.". The machine printed words read "PSM P.Pinang 01 AC090558 01/02/92 015409 *104 ******$100.00 PO 082329T 008085X"

23. The handwritten words "Richland Trade & Dev S/B Annual Return $50" in the photocopy are blanked out in the original and when questioned by the court, learned counsel for the respondent was not in a position to explain.

24. At the adjourned hearing, learned counsel for the respondent reiterated that the date on the original receipt was February 1, 1992 whereas the petition was served on the respondent on February 26, 1992 at the former address. This was clearly evident of the total disregard, he added, of Rule 25(1) of the Rules and making reference to MUl Bank Bhd v Golden Hornbill Hotel Sdn Bhd [1993] 1 MLJ 290 and Summit Co (M) Sdn Bhd v Nokko Products (M) Sdn Bhd (supra), he again brought to our attention the difference between lodging and registering the relevant particulars.

25. However, learned counsel for the appellant pointed out to us that the relevant number given by the Registrar of Companies was always stated on their documents pertaining to the company. She reminded us that for the particulars of the search made by the appellant on the respondent, the Registrar of Companies had put "31474-M" as the respondent's company number and this number appeared on the notice of change made by the respondent.

26. Yet on the original receipt, she submitted, there were two numbers given namely "082329T" and "008085X" which must belong to two other companies and not to the respondent. These numbers cannot be clearly seen in the photocopy which is included in the appeal records of this court and that of the Court of Appeal. In addition, the words "Richland Trade & Dev S/B Annual Return $50.00" appearing on the photocopy but not on the original give the impression that the receipt refers to the respondent.

27. But this cannot be so now that the machine printed details on the original receipt can be read clearly. Further, why the handwritten words do not appear on the original has not been explained. It is also not disputed that Chow's company was secretary to a number of companies. Whether the handwritten words were put in intentionally, for the purpose of deception, or mistakenly, because of a mix-up, is anybody's guess.

28. At best, 731 Dato Keramat Road, Penang was the address of the respondent's secretary and not, in law, the registered office of the respondent when the petition was served. The receipt cannot be as regards the respondent. This means that the respondent was still at the old registered address when the petition was served on February 26, 1992 and all this hullabaloo in the Court of Appeal about the service being void and ineffective remains only a hullabaloo.

29. The Table of Fees under the Second Schedule of the Companies (Amendment of Schedules) Order 1993 was produced by learned counsel for the appellant to show that the fee payable for "lodging, registering, depositing or filing any other document with or by the Registrar under any Act (where the fee is not specified in any relevant Act or regulation)" is RM10 (item 59), but the receipt produced was for RM100 and since it was for two companies, it must be as regards an item in the Schedule amounting to RM50 per company. A look through the list shows that it cannot be for the purpose of a change of address. Learned counsel for the appellant had tendered a letter from the Registrar of Companies to state that the purpose was for the lodgment of annual returns. In any case, this point is irrelevant since the receipt does not concern the respondent.

30. On these considerations, we are confident that the Court of Appeal would have come to the same conclusion if they had had sight of the original receipt. We have no alternative but to hold that the service on the respondent is valid and consequently the finding of the Court of Appeal that it was otherwise has to be set aside. The appeal is allowed with costs here and in the courts below. The case is remitted to the High Court, Penang for a winding-up order on the winding-up petition dated December 31, 1992 to be made. The deposit is refunded to the appellant.

Cases

Fawzia Osman v BBMB [1991] 1 MLJ 426; Lim Boon Peng v United Orient Leasing Co Bhd [1991] 1 MLJ 292; Low Mun v Chung Khiaw Bank Ltd [1988] 1 MLJ 263; MUI Bank Bhd Golden Hornbill Hotel Sdn Bhd [1993] 1 MLJ 290; PT Pelajaran Nasional Indonesia v Joo Seang & Co Ltd [1958] 24 MLJ 113; Sri Hartamas Development Sdn Bhd v MBF Finance Bhd [1991] 3 MLJ 325

Legislations

Companies Act 1965: s.218

Companies (Amendment of Schedules) Order 1993

Companies (Winding-up Rules) 1972: R.25(1)

Rules of the High Court 1980

Representations

Asbir Kaur Singha and Hira Singh (Asbir, Hira Singh & Co) for Appellant

Gurbachan Singh and Teja Singh Penesar (Bachan & Kartar) for Respondent

Notes:-

[a] see UMBC Bhd v Tropiland Trade & Development Sdn Bhd @ www.ipsofactoJ.com/appeal/index.htm [2000] Part 1 Case 1 [CA]

This decision is also reported at [2000] 1 AMR 105; [2000] 1 MLJ 385