JCW

[Quia timet Anti-suit injunction to prevent any Court proceeding and/or injunction proceedings to prevent the calling of an Extraordinary General Meeting of the society “Dong Zong” from deregistration by the Registrar of Societies, implied terms when the Constitution of the Society is silent] The plaintiffs filed an originating summons to obtain a protective order by way of a ‘quia timet’ injunction as they feared that the first defendant (‘D1’) might obtain an injunction to restrain the holding of the Extraordinary General Meeting (“EGM”) of the United Chinese School Committee’s Association Malaysia (‘Dong Zong’) scheduled to be held on 23 August 2015. The purpose and agenda of the EGM was to solve the leadership crisis by conducting a re-election of committee members. According to the plaintiffs, the EGM was to facilitate a re-election to be carried out so that central committee (‘CC’) members may be elected afresh and for a fresh central executive committee (‘CEC’) to be elected by the CC. According to the plaintiffs, the leadership crisis has had a crippling effect on the Dong Zong and placed the UEC examination which is traditionally held in the month of October of each year, in jeopardy. Apparently, the leadership crisis has also caused much confusion and consternation amongst the Chinese community in Malaysia. The leadership disputes have also led to a physical stand-offs between the parties and police reports have been lodged by the parties concerned. Meanwhile, the Registrar of Societies have issued a notice to deregister Dong Zong. The Court held inter-alia that :- (i)When the Dong Zong’s Constitution is silent, the legal basis on which a term may be implied into the rules or constitution of a society was no different from the test applicable when considering whether a term should be implied to an ordinary contract. The test for implying a term is the business efficacy test and the officious bystander test. After all, the relationship between a society and its members is contractual in nature. Thus the rules or constitution or by-laws constitute the contract and these are to be construed in accordance with the laws of contract. (ii)It was entirely consonant with business efficacy to imply a term in the rules of Dong Zong that the supreme body ie the EGM may deal with and resolve the leadership crisis by conducting a re-election of the committee members which as a collective body would in turn appoint the office bearers of the Dong Zong. A term may also be implied on the basis of the officious bystander test as the members of Dong Zong, if asked, would undoubtedly agree that there should be such a term to allow the EGM to resolve the leadership crisis. (iii)There was no basis for the complaint that the plaintiffs are guilty of subterfuge. They obtained a quia timet injunction on an ex parte basis which way the only way to do it. Given D1’s propensity to injunct meetings (whether rightly or wrongly), the plaintiffs could not be faulted for proceeding on an ex parte basis. In any event, once the ex parte order was served, all cards were on the table and D1 could have taken immediate steps to set it aside, so that he could make whatever application he wanted to injunct the EGM which was to be held on 23 August 2015.