Hamed Ahmed Al Ghazali & Ors v Abrar Group International Sdn Bhd

Appellant(s):

• Mr. Hamed Ahmed Al Ghazali
• Mr. Abdul Latif Al Khunaini
• Mr. Faisal Al Hajri
• Mr. Husam Abu Ghazaleh
• Mr. Ahmad Al Osaimi
• Mr. Fuad Al Wohaib

Respondent(s): Abrar Group International Sdn Bhd

• YA Datuk S. Nantha Balan A/L E.S. Moorthy
• YA Dato' Lim Chong Fong
• YA Dato' Ahmad Kamal Bin Md. Shahid

• The appellants invested in a short-term fund ("Raya Fund") managed by the respondent's subsidiary, which involved the respondent guaranteeing share repurchases.
• Following the 1998 Asian Financial Crisis, the respondent faced severe financial difficulties and entered voluntary liquidation, leading to the fund's failure.
• The liquidator rejected the appellants' proofs of debt, prompting the appellants to challenge this decision in the High Court, which subsequently dismissed their application.

• Whether the High Court erred in affirming the liquidator's rejection of the proofs of debt, particularly regarding the absence of privity of contract between the appellants and the respondent.
• Whether claims based on fraud, breach of fiduciary duty, or constructive trust constituted provable debts in winding-up proceedings under Section 523(1) Companies Act 2016 without a prior writ action and leave of the Court.
• Whether the circumstances justified piercing the corporate veil between the respondent and its subsidiary, or establishing a fiduciary relationship, to hold the respondent liable.

• The Court of Appeal dismissed the appeal, affirming the High Court's decision that there was no privity of contract between the appellants and the respondent regarding the investment.
• The Court held that claims for unliquidated damages (e.g., fraud, breach of fiduciary duty, constructive trust) are not ordinarily provable under Section 523(1) Companies Act 2016 in winding-up without a successful writ action and prior leave of the Court.
• The Court reiterated that judicial intervention in a liquidator's decision is warranted only in exceptional circumstances, and declined to grant leave for a writ action due to insufficient evidential material.