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Issue #8/2026
19 February 2026
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CASE SPOTLIGHTS
SUNMAJU SDN BHD v. TENG THIAM FOO & ORS [2026] 2 CLJ 753 Mareva injunctions should not unduly interfere with a defendant's ability to conduct ordinary business. While Mareva orders preserve assets pending judgment, they do not provide security for claims or create an 'untouchable pot'. The courts must balance the defendant's reasonable business needs against the plaintiff's legitimate interests in asset preservation. The injunction prevents evasion of justice through improper asset dissipation, not legitimate business operation. Hence, variation, where necessary, ought to be allowed to prevent improper dissipation of assets while allowing business continuation. CIVIL PROCEDURE: Injunction - Mareva injunction - Application for variation - Tests - Whether variation serves interests of justice - Whether expenses claimed usually incurred or recurring - Whether expenses claimed legitimate, bona fide and reasonable - Whether payments proper in ordinary course of business - Whether variation sought to convert one form of asset into business operations generating ongoing value while meeting trade obligations JUDICIAL QUOTES“In the meantime, the defence counsel had written to the prosecution to reconsider the charge P2 against the accused. In due course the prosecution in exercise of its power under art. 145(3) of the Federal Constitution agreed to reconsider the charge by offering a new charge under s. 304(a) of the Penal Code. It was only sometime on 21 July 2025 that the defence counsel informed the court that the representation had been accepted. In the same letter, the defence counsel also mentioned that the accused would be making a guilty plea to the reduced charge on the hearing which had been fixed on 10 September 2025. By this time the accused was already 22 years old. She was no longer a youthful offender as understood in s. 2 of the Criminal Procedure Code.” “So, the question is what would be the appropriate sentences for the accused since she no longer falls within the category of ‘youthful offender’. Since she is an adult, she would be subjected to the punishment as imposed by s. 304(a) of the PC wherein the court has a discretion to pass a sentence of imprisonment not exceeding 30 years and also fine. However, the court should not lose sight of the fact that due to circumstances beyond her control, the accused had lost the benefit of being a youthful offender and to be sentenced accordingly. As such the court had taken this as one of the mitigating factors in the sentencing of the accused.” - Per Kan Weng Hin J in PP v. SHY [2025] CLJU 2801 APPEAL UPDATES
LATEST CASESLegal Network Series
CLJ 2026 Volume 2 (Part 3) (i) A breach of confidence occurs when there is unauthorised use of company's confidential information and document, and such usage is detrimental to the aggrieved company causing financial losses to its business. Employees who leave a company ought to return the confidential information and document to the company upon leaving it as those are critical and essential company information; (ii) When employees and key personnel set up a direct competing company almost immediately after leaving its previous company, and utilises the latter's confidential information, this infers that there is a conspiracy among them to injure the aggrieved company, for the purpose of enhancing their new venture and business. In such scenario, a claim of conspiracy to injure is proved and established. TORT | CONTRACT
TORT: Breach of confidence - Duty of confidentiality - Confidential information and document belonging to aggrieved company - Whether there was unauthorised use of information by employees of aggrieved company - Whether detrimental to aggrieved company - Whether confidential information and document used to facilitate setting up of competing company - Whether aggrieved company suffered financial loss - Whether elements of breach of confidence established TORT: Conspiracy to injure - Elements - Unauthorised use of confidential information by employees of aggrieved company to facilitate setting up of new competing company - Creation of template general letter to introduce new rival company to customers of aggrieved company - Whether new company's product direct copy of aggrieved company's system - Whether conspiracy to injure proved CONTRACT: Breach - Confidentiality - Confidential information and document - Whether there was unauthorised use of information by employees of aggrieved company - Whether detrimental to aggrieved company - Whether usage of confidential information and document to facilitate setting up of competing company - Whether aggrieved company suffered financial loss - Whether elements of breach of confidence established
Lee Swee Seng JCA
A joint management body and its members may be held liable for the tort of conspiracy to injure by unlawful means if they collectively obstruct or restrict a developer's access to part of the development, even if within the same master title and development order, without legal or proprietary basis, knowing that such obstruction will inevitably cause the developer financial loss, such as liquidated ascertained damages due to delayed completion and delivery of vacant possession. STRATA PROPERTY
STRATA PROPERTY: Joint management body - Claim - Claim by developer against joint management body ('JMB') - Unlawful interference in economic interests, conspiracy to injure by unlawful means and breach of statutory duties - JMB caused obstruction to one block which provided access to another block - Obstruction restricted developer's access to complete utility works - Obstruction caused delay by developer in handing over vacant possession - Claim by purchasers for liquidated ascertained damages - Whether claims by developer against JMB established
Ravinthran Paramaguru JCA
(i) Similarity of get-up between two competing products is not assessed by comparing individual elements in isolation. What must be considered is the overall impression created by the products as a whole and whether it gives rise to a likelihood of confusion; (ii) Sustained and increasing sales revenue over a significant period constitutes evidence of goodwill. In the absence of contrary evidence, such financial performance is sufficient to prove goodwill in a passing off action. TORT
TORT: Passing off - Elements of - Fishing line products - Proprietor of 'SOL' trademark commenced passing off action against proprietor of 'XOL' trademark - Whether all elements of passing off action established - Whether goodwill in relation to products bearing 'SOL' trademark established - Whether evidence of revenue generated by SOL-branded fishing lines sufficient to prove goodwill - Whether there was misrepresentation by proprietor of 'XOL' trademark - Whether in assessing similarity between two competing products, regards must be had to overall impression of products - Whether damage due to acts of proprietor of 'XOL' trademark could be presumed
Azizah Nawawi JCA
In establishing the forum having the most real and substantial connection with the cause of action, courts must consider several factors, including convenience and expense, availability of witnesses, the law governing the transaction, and the places where the parties reside or conduct business. Malaysia is considered the appropriate and convenient forum for the dispute when the majority of the parties involved in the suit are Malaysian citizens and residents, and the impugned conduct and representations, as well as the execution of the relevant instruments occurred substantially within Malaysia. Even if the agreement is governed by and construed in all respects to be in accordance with the laws of another jurisdiction, while a factor to be considered, it does not, in and of itself, displace the jurisdiction of the Malaysian court. The parties, while recognising one jurisdiction as convenient, reserve the liberty to sue in another if appropriate. CIVIL PROCEDURE
CIVIL PROCEDURE: Forum - Forum conveniens - Parties entered into agreement - Dispute arose due to non-compliance with terms of agreement - Commencement of writ action in Malaysian court - Whether Malaysia the appropriate forum for determination of dispute - Whether choice of Cayman Islands law as governing law of agreement rendered Malaysia inappropriate forum - Whether Malaysian court ought to decline to exercise jurisdiction - Whether agreement had exclusive jurisdiction clause - Whether choice of law clause ousted jurisdiction of Malaysian court - Whether parties mostly Malaysian citizens and residents - Whether Malaysia forum with most real and substantial connection to dispute CIVIL PROCEDURE: Writ - Setting aside - Applications for - Issue of forum non conveniens - Parties entered into agreement - Dispute arose due to non-compliance with terms of agreement - Commencement of writ action in Malaysian court - Whether Malaysia the appropriate forum for determination of dispute - Whether choice of Cayman Islands law as governing law of agreement rendered Malaysia inappropriate forum - Whether Malaysian court ought to decline to exercise jurisdiction - Whether agreement had exclusive jurisdiction clause - Whether choice of law clause ousted jurisdiction of Malaysian court - Whether parties mostly Malaysian citizens and residents - Whether Malaysia forum with most real and substantial connection to dispute - Rules of Court 2012, O. 12, rr. 10(1)(a), 10(1)(g), 10(2) & 10(7)
Choong Yeow Choy J
(i) The exercise of the royal prerogative of mercy is not absolute and must be performed within the legal framework provided by the Federal Constitution ('FC'). Specifically, the Yang di-Pertuan Agong cannot act independently and His Majesty cannot decide on matters of pardon, reprieve or respite independently of the Pardons Board; (ii) An order for house arrest purportedly made under the royal prerogative of mercy is invalid if it is not deliberated at a formal meeting of the Pardons Board, as required by art. 42 of the FC. A writ of mandamus to compel such an order will not lie if the order itself is procedurally flawed or if there is no existing legal framework to execute the specific terms, ie, house arrest of that order. CONSTITUTIONAL LAW | ADMINISTRATIVE LAW
CONSTITUTIONAL LAW: Federal Constitution - Royal prerogative - Reduction of sentence and fine by Yang di-Pertuan Agong ('YDPA') - Allegation of addendum order for house arrest - Whether YDPA could exercise power of mercy independently of Pardons Board - Whether addendum order deliberated at Pardons Board Meeting - Whether mandatory procedural requirements under art. 42 of Federal Constitution complied with - Whether non-compliance with procedure rendered addendum order invalid CONSTITUTIONAL LAW: Federal Constitution - Yang di-Pertuan Agong ('YDPA') - Powers - Prerogative of mercy - Scope of art. 42 of Federal Constitution - Functions of Pardons Board - Whether YDPA bound to consider advice of Pardons Board and opinion of Attorney General - Whether distinction exists between pardon, reprieve and respite regarding procedural requirements - Whether 'respite' could be granted outside Pardons Board Meeting ADMINISTRATIVE LAW: Judicial review - Mandamus - Application to compel respondents to execute house arrest order - Whether order valid - Whether respondents under legal duty to obey order - Whether there was legal framework or mechanism for house arrest in Malaysia - Whether house arrest order capable of execution
Alice Loke Yee Ching J
(i) A party who publishes or causes to be published a notice containing words with a clear ordinary and natural meaning that impute dishonourable conduct to another party is liable for libel, provided the words expose the plaintiffs to hatred, ridicule, or contempt, or lower them in the estimation of right-thinking members of society generally; (ii) A non-client who assists the principal in communicating, drafting, preparing or causing the publication of a defamatory notice is also liable for publication if, on a balance of probabilities, their conduct demonstrates malicious intent or, at least, recklessness to defame the plaintiffs and injure their business reputation. The defence of qualified privilege for a solicitor/agent publishing a statement on behalf of a client is not available if the client himself cannot avail himself of the defence. TORT
TORT: Defamation - Libel - Claim for damages - Notice published in newspaper - Notice referred to court orders - Notice allegedly contained impugned words or statements defamatory of claimants - Whether elements of libel established - Whether notice contained defamatory words which referred to claimants - Whether alleged tortfeasors published notice or caused notice to be published - Whether notice published in bad faith or maliciously - Whether notice published in reckless disregard as to whether defamatory contents were true or otherwise - Whether claimants entitled to damages - Whether there were defences available to alleged tortfeasors - Whether claimants' action abuse of process against alleged tortfeasors - Defamation Act 1957, ss. 8, 9 & 11
Kenneth St James J
A registered proprietor establishes trademark infringement under the Trademarks Act 2019 when the infringer uses a sign, without consent and in the course of trade, on goods or services identical or similar to those covered by the registered mark, where: (i) under s. 54(1) (identity infringement), infringement is automatically established if the sign is identical and the goods/services are identical, requiring no further inquiry into the likelihood of confusion; and (ii) under s. 54(2)(b) (similarity infringement), infringement is established if the sign is similar and the goods/services are identical or similar, provided there is a consequent likelihood of confusion among the relevant public. INTELLECTUAL PROPERTY | CIVIL PROCEDURE
INTELLECTUAL PROPERTY: Trade marks - Infringement - Unauthorised use of trade marks either identical to, or constituted substantial reproduction of, registered marks - Whether there was infringement of trademarks - Whether there was identity infringement - Whether there was similarity infringement - Trademarks Act 2019, s. 54(1) & (2) CIVIL PROCEDURE: Summary judgment - Application for - Infringement of trademarks - Action by registered proprietor against infringer - Unauthorised use of trade marks either identical to, or constituted substantial reproduction of, registered marks - Whether there were triable issues that would warrant full trial - Rules of Court 2012, O. 14
Edwin Paramjothy Michael Muniandy JC
(i) Injunctive relief is the appropriate remedy when the threatened harm is intangible, unquantifiable and potentially permanent. This includes loss of unique intellectual property, damage to business reputation and goodwill, loss of competitive position and regulatory or contractual consequences. In such instances, monetary damages are deemed an inadequate remedy; (ii) A Mareva injunction is justified where there is a real and substantial risk of dissipation of assets to frustrate a potential judgment. This risk must be 'solidly grounded in evidence' rather than speculation. Evidence of past conduct - such as prior misappropriation of company funds, unauthorised asset transfers and lack of transparency - serves as a sufficient basis to conclude that a defendant may dissipate assets. CIVIL PROCEDURE
CIVIL PROCEDURE: Injunction - Interlocutory injunction - Application for continuation of ad interim injunction - Prohibitory, Mareva and mandatory orders - Corporate dispute - Allegations of secret profits, misappropriation of trademarks and company's assets and breach of fiduciary duties - Whether there were serious triable issues - Whether damages adequate remedy - Whether risk of dissipation of assets established - Whether conduct of parties relevant - Rules of Court 2012
Arziah Mohamed Apandi JC
CLJ 2026 Volume 2 (Part 4) (i) An arbitration clause conceptually is a separate and distinct agreement than that of the substance of the main agreement. However, this conceptual separation does not by any means remove or isolate the arbitration clause from becoming 'a term' within the main agreement. Further, it has never been the law that the assignment of all of a contract's terms would require express inclusion (or exclusion) of the arbitration agreement; (ii) The word 'may' in an arbitration clause cannot be read in a silo without properly appreciating the surrounding clauses which effectively present and prescribe the actual options that are made available. If an arbitration clause imposes mandatory reference to arbitration, then it is well within a party's contractual rights to ensure that the other party does not derail away from its mutual agreement to mandatorily refer the dispute to arbitration CONTRACT | WORDS & PHRASES
CONTRACT: Arbitration clause - Incorporation into subcontract - Whether arbitration clause within same singular unit as main agreement - Whether 'all terms' of subcontract include arbitration clause - Whether entirety of terms and conditions of subcontract assigned from one party to another via contractual assignment - Whether there was contradiction between arbitration clause and exclusive jurisdiction clause - Lex contractus - Lex arbitri - Whether arbitration clause and exclusive jurisdiction clause within subcontract enforceable - Whether parties estopped from denying applicability and relevance of arbitration clause - Whether mandatory for parties to refer dispute to arbitration - Whether there ought to be harmonious interpretation upholding mutually agreed arbitration agreement CONTRACT: Terms - Arbitration clause - Incorporation into contract - Whether 'all terms' of contract include arbitration clause - Whether entirety of terms and conditions of subcontract assigned from one party to another via contractual assignment - Whether there was contradiction between arbitration clause and exclusive jurisdiction clause - Lex contractus - Lex arbitri - Whether arbitration clause and exclusive jurisdiction clause within contract enforceable - Whether parties estopped from denying applicability and relevance of arbitration clause - Whether mandatory for parties to refer dispute to arbitration - Whether there ought to be harmonious interpretation upholding mutually agreed arbitration agreement WORDS & PHRASES: 'may' - Interpretation - Arbitration clause - Whether carried directory (optional) meaning - Whether arbitration clause allowed for other modes of dispute resolution - Whether word 'may' read in silo - Whether ought to be read with appreciation of surrounding clauses - Lex contractus - Lex arbitri - Whether there was contradiction between arbitration clause and exclusive jurisdiction clause - Whether mandatory for parties to refer dispute to arbitration - Whether there ought to be harmonious interpretation upholding mutually agreed arbitration agreement CIVIL PROCEDURE: Extension of time - Request for - Whether indication of unequivocal abandonment of right to arbitration - Whether request of extension of time to prepare defence fell within confines of s. 10(c) of Arbitration Act 2005
Wan Ahmad Farid Salleh CJ
(i) The requirements set out in s. 25(1) of the Arbitration Act 2005 ('AA') are mandatory. Although the statutory language explicitly mentions only the 'statement of claim' and 'defence,' these mandatory requirements apply with equal force to a counterclaim; (ii) If an arbitral tribunal grants an award that exceeds a contractually agreed liability cap, that award exceeds the 'terms' and 'scope' of the submission to arbitration under ss. 37(1)(a)(iv) (v), and 39(1)(a)(iv) and (v) of the AA. The court has the discretion to sever the offending portion of the award, to give effect to the express intentions of the parties. ARBITRATION
ARBITRATION: Award - Setting aside - Enforcement - Whether mandatory requirements for statement of claim and defence under s. 25(1) Arbitration Act 2005 ('AA') applicable to counterclaims - Whether court shall take into account s. 30(4A) and (5) of AA when deciding setting aside and enforcement applications - Minimalist approach - Interpretation of Chapters 6, 7 and 8 of AA - Interpretation Acts 1948 and 1967 ARBITRATION: Jurisdiction - Scope of submission - Award exceeding contractually agreed liability cap - Whether tribunal acted beyond terms of submission - Discretion of court to sever award - Whether award should be confined to maximum liability agreed by parties - Arbitration Act 2005, ss. 37(1)(a)(iv), (v) & 39(1)(a)(iv), (v)
Che Mohd Ruzima Ghazali JCA
(i) Where multiple agreements form part of a single, cohesive commercial transaction, they must be interpreted as an inextricable nexus. Consequently, liability under secondary security documents is contingent upon the crystallisation of obligations under the principal agreements. If the primary obligation has not been breached, the security cannot be enforced; (ii) When parties have agreed to a valid arbitration clause, the court should not adjudicate substantive disputes that fall within the scope of that clause. Initiating concurrent court proceedings for the same relief sought in arbitration constitutes a substantial overlap and a multiplicity of proceedings. CONTRACT | COMPANY LAW | MONEYLENDERS | EVIDENCE
CONTRACT: Agreements - Interrelated agreements - Construction - Share subscription agreement, memorandum of deposit and deed of undertaking - Whether agreements formed part of single cohesive commercial transaction - Whether liability under memorandum of deposit and deed of undertaking contingent upon enforceability and breach of principal agreements COMPANY LAW: Shares - Redeemable preference shares - Redemption of - Failure to redeem - Requirement of available distributable profits - Whether redemption obligations crystallised - Whether failure to prove profits meant no breach of principal agreements - Companies Act 2016, s. 72(4) MONEYLENDERS: Illegal moneylending - Enforceability - Commercial transaction governed by share subscription agreement, memorandum of deposit and deed of undertaking - Interests charged - Whether transaction constituted moneylending business - Whether agreement void ab initio - Whether anti-illegality clauses could cure or insulate illegal transaction - Moneylenders Act 1951, s. 15 EVIDENCE: Admission - Liability - Failure to respond to letters of demand - Whether silence or non-response equated to admission of breach or claim Collin Lawrence Sequerah JCA
An employer or a principal is not entitled to dictate that the spouse of an agent of employee cannot gain employment or work in any form from another competing company. Such restriction on third parties' rights of employment that is indirectly imposed through a contracting party falls foul of s. 28 of the Contracts Act 1950 ('CA'). Section 28 of the CA has made it very clear that any agreement where 'anyone is restrained from exercising a lawful profession, trade or business of any kind' is to that extent void. CONTRACT
CONTRACT: Employment contract - Agency - Terms and conditions - Clause restricting right of spouse of agent of insurance company from taking employment with another insurance company or takaful operator - Restriction on third parties' rights of employment indirectly imposed through contracting party - Whether clause fell foul of s. 28 of Contracts Act 1950
Mohd Arief Emran Arifin J
A freezing order is an interim prohibitory injunction granted by a court to restrain a defendant from disposing of, dealing with, or removing their assets before a final judgment is delivered. The primary goal is to prevent the defendant from frustrating the court's judgment by rendering themselves unable to satisfy the claim. A Mareva injunction will be granted if the applicant satisfies the court, on a balance of convenience, that (i) the applicant has a good arguable case; (ii) the assets in question are within the jurisdiction of the court; and (iii) there is a real risk of dissipation of those assets or removal out of the jurisdiction of the court before judgment. CIVIL PROCEDURE
CIVIL PROCEDURE: Injunction - Mareva injunction - Application for - Loan obtained for contract awarded - Applicant guarantor under loan agreement - Monies released to borrower under contract awarded not utilised to satisfy loan granted by financier - Borrower paid monies to other companies instead of satisfying loan - Financier obtained summary judgment against borrower and applicant - Applicant sought Mareva injunction against borrower - Whether requirements for granting of Mareva injunction satisfied - Whether applicant had good arguable case - Whether borrower had assets within jurisdiction of court - Whether there was real risk of dissipation of assets and removal out of jurisdiction of court before judgment CIVIL PROCEDURE: Discovery - Application for - Loan obtained for contract awarded - Applicant guarantor under loan agreement - Monies released to borrower under contract awarded not utilised to satisfy loan granted by financier - Borrower paid monies to other companies instead of satisfying loan - Financier obtained summary judgment against borrower and applicant - Applicant sought discovery order against borrower to compel borrower to disclose details of money received under contract awarded - Whether application ought to be allowed
Gan Techiong JC
Seorang hakim mahkamah rendah hanya boleh mengeluarkan perintah melepaskan tanpa membebaskan (DNAA) atas kuasa sendiri setelah mendapati pertuduhan terhadap tertuduh tidak berasas. Dalam keadaan Mahkamah Sesyen tidak membuat dapatan tersebut dan pihak pendakwaan tidak memaklumkan hasrat untuk tidak meneruskan dengan kes, perbicaraan sepatutnya diteruskan. PROSEDUR JENAYAH
PROSEDUR JENAYAH: Semakan - Semakan terhadap keputusan Mahkamah Sesyen - Perintah melepaskan tanpa membebaskan - Sama ada pertuduhan terhadap tertuduh berasas - Sama ada perintah salah, tidak teratur dan melangkaui bidang kuasa - Kanun Tatacara Jenayah, s. 173(g) - Akta Keterangan 1950, s. 103
Abdul Fareed Abdul Gafoor PK
ARTICLESLNS Article(s)
LEGISLATION HIGHLIGHTSPrincipal Acts
Amending Acts
PU(A)
PU(B)
Legislation Alert Updated
Revoked
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