Build House Sdn Bhd is operating a housing construction business. Two of the directors, Nizam and Nazrul

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Question:

Build House Sdn Bhd is operating a housing construction business. Two of the directors, Nizam and Nazrul hold 40% each of the shares of the company and the remaining 20% is held by the third director, Rahman. Recently the company obtained a contract worth RM2 million for the construction of a Rumah Mampu Milik awarded by the Ministry of Housing Development. A disagreement arose between the directors following which Nizam and Nazrul set up a new company called Autaa Sdn Bhd without the khowledge of Rahman and transferred the contract to Autaa Sdn. Bhd. When Rahman protested, Nizam and Nazrul as the majority shareholders passed a resolution approving the transfer of the contract to Autaa Sdn Bhd and declaring that Build House Sdn Bhd has no interest in the contract. Both of them also passed a member’s resolution to alter the company’s constitution to the effect that a member was required to sell his shares if so requested by the member holding 40% of the company’s shares. This was done to make sure that Rahman will no longer be a member in the company.

Rahman, being dissatisfied with the above action, wishes to file a suit against them on behalf of the company. Advise Rahman.