Company Law

Akanda Sdn Bhd (Akanda) is a company which specialises in the manufacture of high-density steel used in the construction industry. Bill, Carl and Dobby are its directors. Although the company was prosperous in the past, it has suffered severe losses over the past three years and is now insolvent.

Six months ago, Bill and Carl, pursuant to a decision taken at a board meeting, ordered, on credit, RM 3 million worth of vibrantium alloy metal from Busan Steel Sdn Bhd (Busan). When Dobby later learned of this transaction, he questioned Bill and Carl as to how Akanda was going to pay for the goods when it was totally insolvent. They replied that they did not have any intention of paying Busan.

Bill and Carl had also appointed Shirley as company secretary. However, Shirley has been practising as a company secretary without a valid license for 5 years. Four months ago, Bill and Carl approached Shirley and requested her to issue share certificates to their spouses without the full subscription price being collected and without a proper resolution being made for the issuance of the shares.

Last week Akanda was put into insolvent liquidation, and a liquidator was appointed.

Advise the liquidator on possible actions against the relevant officers (directors and company secretary) of Akanda Sdn Bhd and whether any of them have personal liability on the matters raised.