Queensway Nominees (Asing) Sdn Bhd & Ors v ISM Sendirian Bhd

Appellant(s):

• Queensway Nominees (Asing) Sdn Bhd
• Mulpha Kluang Maritime Carriers Sdn Bhd
• Queensway Nominees (Tempatan) Sdn Bhd
• West-Jaya Sdn Bhd
• Leisure Dotcom Sdn Bhd
• MPHB Capital Berhad
• Multi-Purpose Shipping Corporation Berhad
• Tan Sri Surin Upatkoon
• Kheoh And Yeng
• Ivevei Upatkoon
• Datuk Vijeyaratnam A/l V.thamotharam Pillay

Respondent(s): ISM Sendirian Berhad

• YA Datuk Ravinthran a/l Paramaguru
• YA Dato' Sri Mariana binti Haji Yahya
• YA Dato' Lim Chong Fong

• The plaintiff initiated five consolidated civil suits under section 181 of the Companies Act 1965, alleging minority oppression by the defendants (the majority shareholder and directors of five joint venture companies).
• The dispute arose from an oral joint venture agreement for a large-scale property development, where the plaintiff was to hold 30% equity in the JV companies, but funding terms became contentious.
• The High Court found in favour of the plaintiff, ruling that oppression had occurred and ordering a buyout of the plaintiff's shares, while dismissing the defendants' counterclaim.

• Whether the High Court erred in finding that the affairs of the five joint venture companies were being conducted in a manner oppressive to the plaintiff within the meaning of section 181 of the Companies Act 1965.
• Whether the relationship between the parties constituted a "quasi-partnership" (an Ebrahimi-type company), which would allow equitable considerations to be applied in an oppression claim.
• Whether a breach of an oral shareholders' agreement could form the basis of an oppression claim under section 181, particularly in light of the Federal Court's decision in *Jet Tech Materials v Yushiro V Chemical Industry*.

• The Court of Appeal held that the five joint venture companies were mere "shell entities" for land acquisition, and the actual "affairs" of the joint venture resided in an unincorporated entity, thus precluding a claim for oppression under section 181 within these specific companies.
• The Court found that the High Court erred in concluding that a quasi-partnership existed, as the relationship between the parties was purely commercial and at arm's length, lacking the personal character required for such a finding.
• Applying the principle of *stare decisis* and the *Jet Tech Materials* precedent, the Court ruled that a breach of a shareholders' agreement cannot sustain an oppression suit under section 181 unless a quasi-partnership is established, which was not the case here. The defendants' appeal was allowed, setting aside the High Court's decision, and the plaintiff's appeal on damages was dismissed.