Case Update: Court of Appeal Finds Unsecured Creditors Can Oppose Judicial Management Application


The Court of Appeal in the appeal involving Million Westlink Sdn Bhd (see the notes of proceedings of 21 July 2020 in the Court of Appeal Civil Appeal No. B-02(IM)-1590-08/2019) has confirmed that unsecured creditors have the right to be heard and to oppose the making of a judicial management order. The full grounds of judgment are not out yet.

This now overturns the earlier High Court decision in Million Westlink Sdn Bhd v Maybank Investment Bank Bhd & Ors [2019] MLJU 1721. The outcome of this Court of Appeal decision also appears to be similar to the High Court decision in Goldpage Assets Sdn Bhd (which I wrote about here).

When a company applies for judicial management, the company would be near insolvent. The company needs rescuing and an orderly dealing with its creditors. Hence, this Court of Appeal decision is important in clarifying that unsecured creditors have a right to appear and, if necessary, to oppose the making of the judicial management order.

Case Update: Unsecured Creditors Can Intervene in a Judicial Management Application

The High Court in its grounds of judgment dated 10 June 2020 in Goldpage Assets Sdn Bhd v Unique Mix Sdn Bhd held that unsecured creditors can intervene in a judicial management application. The unsecured creditors’ views can then be heard in opposing the making of the judicial management order. This is an important decision clarifying this often argued point.

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TML and Legal Logic Asia Talk: Post Implementation Challenges of the Companies Act 2016

On 20 April 2018, I will be speaking at the Legal Logic Asia talk on The Companies Act 2016: Post Implementation Challenges, New Corporate Rescue Mechanism Rules 2018 & Malaysian Code of Corporate Governance.

My co-speaker, Kenneth Foo, and I designed the course contents and the programme should be very enriching for the audience. We will using practical examples and real-life case studies to flesh out the issues we have come across. You can access the registration form here and with an early bird rate of RM800 if you sign up by 13 April 2018.

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The Corporate Rescue Mechanism in Malaysia: CVA and Judicial Management

By the gazetting of the notice P.U. (B) 106/2018 dated 27 February 2018, the corporate rescue mechanism under Division 8 Part III of the Companies Act 2016 has come into force on 1 March 2018. The corporate rescue mechanism allows for financially distressed companies to consider two options: (1) corporate voluntary arrangement and (2) judicial management.

I set out only some brief key features of these two mechanisms. Along with the coming into force of the corporate rescue mechanism provisions, the new Companies (Corporate Rescue Mechanism) Rules 2018 have also come into force on 1 March 2018. Continue reading