Yew Huoi, How & Associates | Leading Malaysia Law Firm

ADMIRALTY LAW – MARITIME LABOUR CONVENTION (MLC) 2006 – ENTRY INTO FORCE OF THE MLC IN MALAYSIA

The MLC 2006 consolidates 68 international maritime labor legal instruments and recommendations of the International Labor Organization (ILO).

Q: What is the purpose of the MLC 2006?

  1. Codifies seafarers’ rights together with health, safety and employment standards.
  2. It establishes an enforcement and monitoring mechanism for the protection of seafarers ‘rights.

Q: Has Malaysia ratified the MLC 2006?

  • Malaysia ratified the MLC 2006 on the 20th of August 2013. Following the ratification, the Merchant Shipping Ordinance (MSO) 1952 was amended pursuant to the MSO (Amendment) Act 2016, the 2016 Act aimed to align the provisions set forth in the MSO 1952 with the requirements imposed under the MLC 2006.

Q: What are the amendments introduced under the MSO (Amendment) Act 2016?

  1. Manning and qualification, ensures ships have the necessary volume and professionally ascertained seafarers’ when conducting the voyage.
  2. Conditions of service, creates enforceable rights and obligations between seafarers and their employers.
  3. Wages
  4. Health
  5. Accommodation and Provisions
  6. Conduct and discipline

Q:  Who must comply to these amendments?

  1. Owners
  2. Seafarers’
  3. Ships

Q: Is proper enforcement in place for the amendments under the MSO (Amendment) Act 2016?

  • The Malaysian Shipping Notice issued by the Maritime Department of Malaysia, practices the Declaration of Maritime Labour Compliance (DMLC). Shipowners are required to indicate their compliance with the MLC.
  • The Maritime Department of Malaysia have went to strenuous lengths to incorporate the MLC into the domestic shipping scene in the country. However only with the continued support of seafarers, masters and owners can Malaysia steer herself towards the port of compliance to the MSO 1952.

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In a landmark decision in Aikbee Timbers Sdn Bhd & Anor v Yii Sing Chiu & Anor and another appeal [2024] 1 MLJ 94 , the Court of Appeal clarified the rules on maintenance charges and sinking fund contributions in mixed strata developments. Developers and management corporations can impose different rates based on the distinct purposes of residential and commercial parcels. The judgment emphasizes fairness, ensuring residential owners bear the costs of exclusive facilities like pools and gyms, while commercial owners aren’t subsidizing amenities they don’t use. This ruling highlights the importance of transparency in budgeting and equitable cost-sharing in mixed-use properties.

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ILLEGALITY OF UNREGISTERED ESTATE AGENTS’ CLAIM – FINDER’S FEES AND ILLEGALITY: COURT DRAWS THE LINE ON UNREGISTERED ESTATE AGENTS

In a pivotal ruling, the Court of Appeal clarified that finder’s fee agreements are not automatically void under the Valuers, Appraisers, Estate Agents and Property Managers Act 1981. The Court emphasized that illegality must be specifically pleaded and supported by evidence, and isolated transactions do not trigger the Act’s prohibition. This decision highlights the importance of precise pleadings and a clear understanding of the law’s scope.

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COMPANIES ACT – OPPRESSION – DRAWING THE LINE: FEDERAL COURT DEFINES OPPRESSION VS. CORPORATE HARMS

In a decisive ruling, the Federal Court clarified the boundaries between personal shareholder oppression and corporate harm, overturning the Court of Appeal’s findings. The Court held that claims tied to the wrongful transfer of trademarks belonged to the company, not the individual shareholder, reaffirming that corporate harm must be addressed through a derivative action rather than an oppression claim.

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COMPANIES LAW – WHEN DIRECTORS BETRAY: COURT CONDEMNS BREACH OF TRUST AND CORPORATE MISCONDUCT

In a stark reminder of the consequences of corporate betrayal, the court found that the directors had systematically dismantled their own company to benefit a competing entity they controlled. By breaching their fiduciary duties, conspiring to harm the business, and unjustly enriching themselves, the defendants were held accountable through significant compensatory and exemplary damages, reaffirming the critical importance of trust and integrity in corporate governance.

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JURISDICTION – CHOOSING THE RIGHT COURT: THE SEA JUSTICE CASE HIGHLIGHTS WHERE MARITIME DISPUTES SHOULD BE HEARD

In The Sea Justice cases [2024] 2 Lloyd’s Rep 383 and [2024] 2 Lloyd’s Rep 429, the Singapore courts tackled a key question: which country should handle a maritime dispute when incidents span international waters? After examining the location of the collision, existing limitation funds in China, and witness availability, the courts concluded that China was the more appropriate forum. This ruling highlights that courts will often defer to the jurisdiction with the closest ties to the incident, ensuring efficient and fair handling of cross-border maritime disputes. This approach is also relevant in Malaysia, where similar principles apply.

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