Company Directors Can Hold On To Their Posts Until The Age Of 70

An interesting Malaysian legal case on age of director which came about because of family dispute in a public listed company:
“Company directors can hold on to their posts until the age of 70 as a result of a  decision by the Court of Appeal in Putrajaya against a resolution implemented by the Kian Joo Can Factory Bhd,a public listed company forcing their directors to retire at the age of 55.”
Background of Company,Kian Joo Can Factory:-

• Is the largest canning factory in the country,based in Gombak and
• listed on the main board of Bursa Malaysia.

Snapshot of the case:
Plantiffs:

• Managing Director of Kian Joo Can Factory and his brother Datuk See Teow Chuan (executive director)

Respondents:

• The respondents are chairman Tunku Nadzaruddin Tuanku Jaafar,plantiffs’ two brothers Datuk Anthony See Teow Guan(executive director) and See Tiau Kee(executive director),their uncle See Ean Seng (executive director) and Kian Joo Can

Judges:

• presiding Judge Datuk Gopal Sri Ram was leading a three-member panel that included Judge Datuk Zulkefli Ahmad Makinuddin and Datuk Md Raus Sharif.

Counsel:

• The brothers were represented by counsel Datuk V. K. Lingam while counsel Romesh Abraham appeared for the respondents.

Details of case:

• The resolution,which was drawn up on March 31 1999 was implemented on its managing director and his brother See Teow Koon,who was then the executive director.
• Teow Chuan who was then 58,and Teow Koon,then 51,challenged the resolution as being improper.
• The High Court had on October 18 2004,dismissed Teow Chuan and Teow Koon’s application
• However,now presiding Judge Datuk Gopal Sri Ram announced an unanimous decision which  granted a permanent injunction restraining Kian Joo Can from implementing the 1999 Board of Director’s resolution on the two plaintiffs.

Rationales/Reasons quoted by presiding judge:

• the resolution was against Clause 26 of the Human Resource package for executive directors and ordered that Teow Chuan,now 65,and Teow Koon,57,be entitled to continue with their positions.
• There were  two reasons for the decision:q the 1999 resolution could not be implemented retrospectively because Teow Chuan was 58 that year;q Section 54 (f) of the Specific Relief Act,does not apply here as when they joined the company,there was no agreement and no stipulated retirement age.
• as a matter of law,the court was satisfied that the High Court judge had misdirected herself in dismissing both the plaintiff’s application.

Final Outcome:

• both Teow Chuan,now 65,and Teow Koon,57 can continue to enjoy such benefits until they attain the age of 70 or until they choose to retire.

( The Business Time 5/10/06)

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