Lian Keow Sdn Bhd

- vs -

Paramjothy

Judgment

Yusof Abdul Rashid J

1. The plaintiffs through the Official Receiver of Malaysia who has been appointed by the court as liquidator of the plaintiffs which are in the process of being wound-up, filed a writ seeking, inter alia, a declaration that they are the beneficial owners of a piece of land held under Grant 6705 Lot 2084 in the Mukim of Tebrau in the District of Johore Bahru (the “said land”) and that the first defendant is holding the said land in trust for the benefit of the plaintiffs.

2. To prevent the destruction of the Trust Deed and the relevant files relating to the purchase of the said land from the former proprietors thereof, the plaintiffs applied to court for the custody of all those documents relevant to the action instituted in court which were believed to be in the custody of the first defendant.

3. However, such application could not possibly be made inter partes for fear that the first defendant might destroy or conceal them to defeat the ends of justice. As such, the plaintiffs applied ex parte for an “Anton Piller” order to authorise the plaintiffs’ representatives to enter the premises of the first defendant and to take into custody those documents which are essential evidence in the action.

4. The application was supported by an affidavit deposed by the Official Receiver Malaysia wherein it was disclosed that the first defendant had admitted to one, PC Dowson, the Assistant Registrar General in the Official Receiver’s Office in Hong Kong that though he (the first defendant) was the registered proprietor of the said land, he was in fact holding it in trust for an unidentified company in the Mosbert Group of which the plaintiffs were one of them.

5. From the plaintiffs’ records it was disclosed that the plaintiffs were the beneficial owners of the said land though the first defendant was the registered proprietor thereof. The first defendant had affirmed in an affidavit, attached to the supporting affidavit of the Official Receiver Malaysia, that he was the registered proprietor of certain other pieces of land in the Mukim of Pulai Johore Bahru but in fact he was holding them in trust for other companies in the Mosbert Group. Exhibited to the supporting affidavit was a letter written by the first respondent to one, Ng Kong Yeam, admitting that he was holding the said land in trust. It was also admitted that a Trust Deed was executed in relation to the said land.

6. It has come to my attention that in relation to the said land, the first defendant, in breach of the said trust, had entered into a Sale and Purchase Agreement with one Ng Kam Loon on 26 January 1980 purporting to sell the said land for $120,000 for which the first defendant had accepted a sum of $12,000 as deposit and part payment towards the purchase price of the said land. The sale could not be completed since the plaintiffs had entered a caveat against the said land to protect their interests therein. On record, it was revealed that the first defendant by an Originating Motion No 15 of 1981 had applied to the Johore Bahru High Court for an order to have the said caveat removed in order to effect the sale of the said land.

7. On the evidence before me I was satisfied that though the first defendant was the registered proprietor of the said land, he was holding it in trust for the plaintiffs. I was also satisfied that in breach of the said trust the first defendant had entered into a Sale and Purchase Agreement to dispose of the said land. It was also established that the first defendant was in possession of a file dealing with the purchase of the said land from the previous proprietor and had executed a Trust Deed in relation to the said land.

8. With these facts in mind I dealt with the application of the plaintiffs for an “Anton Piller” order.

9. I had no doubt at all that under s 233(1) of the Companies Act 1965, the Official Receiver Malaysia was entitled to take into custody or control all properties to which the plaintiffs were or appeared to be entitled and under s 277(5) of the said Act, the Official Receiver Malaysia was at liberty to apply to court for an order that the first defendant as trustee regarding the said land to deliver, convey or surrender all books and papers in his possession to the Official Receiver Malaysia and to which the plaintiffs were prima facie entitled.

10. To recover the Trust Deed and relevant file in relation to the said land from the first defendant, the plaintiffs had applied for an “Anton Piller” order and in considering the application I had to satisfy myself whether or not the circumstances existing at the time of application would justify me in granting such order.

11. It had been said in the English Court of Appeal case of Anton Piller Kg v Manufacturing Processes Ltd [1976] 2 WLR 162 that in most exceptional circumstances the court has an inherent jurisdiction to issue such an order.

12. In that case the defendants were the United Kingdom agents of the plaintiffs, German manufacturers of frequency converters for computers. The plaintiffs claimed that the defendants were in secret communication with other German manufacturers and were giving them confidential information about the plaintiffs’ power units and details of a new converter, the disclosure of which could be most damaging to the plaintiffs. In order to prevent the disposal by the defendants, before discovery in an action, of documents in their possession relating to the plaintiffs’ machines or designs, the plaintiffs applied ex parte for an interim injunction to restrain the defendants from infringing their copyrights and disclosing confidential information and for an order for permission to enter the defendants’ premises to inspect all such documents and to remove them into the plaintiffs’ solicitors’ custody. On the plaintiffs’ undertaking to issue a writ forthwith, Brightman J granted the interim injunction but refused to order inspection or removal of documents.

13. On the plaintiffs’ ex parte appeal, which was heard in chambers with judgments later in open court, the English Court of Appeal held that in most exceptional circumstances, where plaintiffs had a very strong prima facie case, actual or potential damage to them was very serious and there was clear evidence the defendants possessed vital material which they might destroy or dispose of so as to defeat the ends of justice before any application inter partes could be made, the court had inherent jurisdiction to order defendants to “permit” plaintiffs’ representatives to enter defendants’ premises to inspect and remove such material; and that in the very exceptional circumstances the court was justified in making the order sought on the plaintiffs’ ex parte application.

14. Though the English Court of Appeal case of Anton Piller dealt with matters relating to copyright, the jurisdiction to issue such an order was extended to other matters in the English Court of Appeal case of Yousif v Salama [1980] 3 All ER 405.

15. In the latter case the plaintiff purchased goods for the defendants to resell under an agreement whereby the defendants were to pay the plaintiff commission for the goods supplied. For some years transactions took place and commission accrued to the plaintiff but was not paid. The plaintiff visited the defendants’ office where he saw the accounts showing the amount of commission due to him. The plaintiffs then issued a writ claiming the amount owed and, fearing that the defendants might destroy the two files containing the accounts and a diary which contained details of the transactions, applied for an Anton Piller order permitting him to enter the defendants’ premises to search and locate the files and diary and remove them to the custody of his solicitor. The English Court of Appeal, in that case, held that —

    The court had a discretion to grant an Anton Piller order to enable the preservation of a document which did not itself form the subject matter of the action, where (per Lord Denning MR) the document was the best possible evidence and the plaintiff genuinely feared that the defendant would destroy it prior to hearing of the action, or (per Donaldson LJ) there was a very clear prima facie case leading the court to fear that the defendant would conceal or destroy essential evidence and that to do so would deprive the plaintiff of any evidence on which to put forward his claim and so frustrate the process of justice, or (per Brightman LJ) there was prima facie evidence that essential documents were at risk ....

16. The House of Lords had the opportunity of deliberating on the jurisdiction to issue Anton Piller order when the House dealt with the case of Rank Film Distributors Ltd v Video Information Centre [1981] 2 WLR 668; [1981] 2 All ER 76. In that case the House of Lords held that

    in respect of the orders requiring the defendants to allow access to premises for the purposes of looking for illicit copy films and to allow their being removed to safe custody, there was jurisdiction to make those orders...

17. Thus, in most exceptional circumstances, the court has jurisdiction to order a defendant to permit the plaintiffs’ representatives to enter defendant’s premises to inspect and remove vital material which the defendant might destroy or dispose of so as to defeat the ends of justice before an inter partes application for an injunction could be made.

18. The order is for the first defendant to permit the plaintiffs’ representatives to enter the office of the first defendant, who has the right to refuse to allow the plaintiffs’ representatives to enter, inspect the relevant files, and to take into their custody the relevant Trust Deed. In the event of the first defendant refusing permission to the plaintiffs’ representatives to enter the premises, the plaintiffs may then bring it to the notice of the court. Should it be proved that the refusal was unreasonable, appropriate action might be taken against the first defendant, even to the extent of committing him. By the order, the first defendant is put in peril if he chooses to refuse permission and such refusal would also occasion adverse inferences being drawn against him.

19. Since I was satisfied that the plaintiffs had proved a strong prima facie case against the first defendant that he held the said land in trust for the plaintiffs, that there was indeed a serious danger of the first defendant destroying the Trust Deed and files relating to the said land and that the first defendant was in possession of such Trust Deed and files, I issued the order accordingly.

Cases

Anton Piller Kg v Manufacturing Processes Ltd [1976] 2 WLR 162; Yousif v Salama [1980] 3 All ER 405; Rank Film Distributors Ltd v Video Information Centre [1981] 2 WLR 668; [1981] 2 All ER 76

Representations

T Thomas for the plaintiffs.