KUALA LUMPUR (May 15): The High Court has ruled that UK-based Serendib Capital Ltd must pay RM200,000 as security for costs in its lawsuit against Datuk Seri Mahmud Abu Bekir Taib, Sarawak Cable Bhd (KL:SCABLE), and six others.
The payment must be made within 14 days from May 13, or Serendib’s case will be struck out.
According to a court order seen by The Edge, Judicial Commissioner Dr Suzana Muhamad Said approved Mahmud Abu Bekir’s request for security costs and ordered Serendib to pay RM200,000 within 14 days from May 13. If Serendib fails to do so, its lawsuit against Mahmud Abu Bekir will be struck out.
On March 20, Mahmud Abu Bekir filed an application through his lawyers, Messrs Dinesh Ratnarajah Partnership, asking the court to order Serendib to provide security costs. He argued that Serendib is a UK-based company with only £100 (RM569) in paid-up capital and no assets in Malaysia.
“Furthermore, Serendib is the only plaintiff in the suit, and should it be ordered to pay costs, there are no others that could be relied on,” Mahmud Abu Bekir, who is also a director of Sarawak Cable, said.
Mahmud Abu Bekir was represented by Ashok Kandiah and Dinesh, Tan Jun Yu appeared for Serendib while Janice Tay Shu Hui appeared for Sarawak Cable.
In May last year, Serendib sued Sarawak Cable, Mahmud Abu Bekir and six other directors, claiming they conspired to harm the company. Serendib is seeking RM6.2 million in damages and RM300,000 for managing Sarawak Cable and its subsidiaries. It is also asking the court to award punitive and aggravated damages.
The UK-based company, which focuses on environmental, social and governance investments and blue carbon initiatives, claimed it was brought in to help restructure Sarawak Cable’s debts after the company fell into Practice Note 17 status in September 2022.
Serendib said it signed a memorandum of agreement (MOA) in December 2023 to act as Sarawak Cable’s “white knight”. The company argued the MOA was binding on Mahmud Abu Bekir, who it claims is the controlling shareholder.
It said it fulfilled its duties under the MOA, but Mahmud Abu Bekir disagreed, saying the company failed to meet key milestones. A notice to terminate the MOA was issued on April 30, 2024.
“The termination of the MOA is unlawful and amounts to a wrongful repudiation of the MOA,” Serendib alleged.
Mahmud Abu Bekir, in his defence, argued that Serendib’s efforts were of no value because Sarawak Cable didn’t reach any deals with its creditors as promised. He said Serendib failed to meet legal requirements under the Contracts Act. An audit by CEO Russel Walter Boyd found no action was taken by Serendib, and Sarawak Cable’s board agreed to end the agreement with the company.