Malaysia Company Law

TOPIC 8 MANAGEMENT OF A COMPANY

Ahmad, Bong and Cathy are the directors of Alpha Sdn Bhd ("Alpha"), a private limited company situated in Bandar Sunway. The company is involved in the leisure and hospitality business covering theme parks, gaming, hotels, seaside resorts and entertainment for over 50 years. Each of the directors holds 15% of the company's share capital. Answer the following separate and independent questions:

(USE IRAC RULES;I=Issue, R=Rule, A=Analysis,C=Conclusion). Please provide relevant section and example cases.

a. Beta Bhd ("Beta") is a public limited company. The company wishes to enter into a contract with "Alpha" for the supply of iron and steel to be used for Alpha's theme parks. The Board of Directors of "Alpha" had a meeting last month to decide on the matter. They decided that the company will proceed with the contract with "Beta". However, recently, after entering and completing the contract, they discovered that the Managing Director of "Beta" is Bakar, who is a good friend of Bong.

b. Recently, "Alpha" contracted to buy a piece of land from Ahmad which was to be converted to a water theme park. The market value of the land is RM 600,000. "Alpha" bought the property at RM 550,000.

Advise the Board of Directors of "Alpha" on the legal issues arising in the above questions.