Lost a Court Case and Appealing? Your Company Can Still Be Wound Up

Your company loses a court case and is ordered to pay. You file an appeal and even put the money with your lawyers while you wait.

Does that keep your company safe from being wound up?

Not on its own, says a recent Kuala Lumpur High Court decision.

What happened?

A company was ordered after a full trial to pay about RM15.7 million, including interest and costs. The winners served a formal demand at its registered office. After 21 days the company had not paid, offered security or settled, so the winners asked the court to wind it up.

The company had appealed. The Court of Appeal paused enforcement of the judgment, on condition that RM15 million was placed in the company's lawyers' account, and that was done. But the Court of Appeal refused to stop the winding up case itself.

What did the court say?

An appeal does not turn a court judgment into a disputed debt. It stands until it is set aside.

Pausing enforcement is not the same as stopping a winding up case.

Money held by lawyers until the appeal ends is not payment. The creditors had not received a single sen, and the deposit was also short of the full debt.

Saying the company is "financially stable" is not proof. It had no current audited accounts or cash flow statements to show it could pay its debts when due. Its own balance sheet showed zero revenue and RM8.76 million in accumulated losses.

The court ordered the company to be wound up and appointed a liquidator. It decided on 19 October 2026, with written grounds dated 12 November 2026.

What does this mean for you?

If your company receives a formal demand for a debt, treat the 21 days seriously. Pay, offer security or agree a settlement. Filing an appeal alone may not be enough.

If you say the company can pay, be ready to prove it with up to date accounts and cash flow figures.

If you need help keeping your management reports and cash flow forecasts up to date, our CFO Advisory and Financial Operations Support teams can assist. Feel free to WhatsApp us at 010-246 2151.