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Kota Kinabalu: The Court of Appeal will deliver its decision on the Federal Attorney of Malaysia’s (AGM) appeal against the leave granted to Sabah Law Society (SLS) regarding the State’s special grant on a later date.

Court of Appeal Justices Datuk Ravinthran N. Paramaguru, Datuk Mohd Nazlan Mohd Ghazali and Datuk Dr Choo Kah Sing adjourned their decision on the matter after hearing oral submissions from all parties.

The court said they still have to discuss more on the issues raised and do not want to rush their decision. The court fixed May 24 for case management.

The AGM was appealing the High Court’s decision on Nov. 11, 2022  to grant leave  to SLS for judicial review against the Federal Government’s failure to conduct a review of the 40 per cent special grant due to Sabah under the Federal Constitution. SLS obtained leave on June 8, 2022.

The SLS filed the leave application on June 9, 2022, naming the Federal Government and Sabah State Government as the first and second respondents, respectively.

In Thursday’s proceedings, Senior Federal Counsel (SFC) Ahmad Hanir Hambaly @ Arwi for the AGM as appellant, submitted that the High Court had erred in allowing leave for judicial review.

The appellant raised two points namely no locus standi and the subject matter of review is non-justiciable.

On locus standi, SFC Ahmad submitted that they raised the issue on the reason being that the subject matter for the substantive Judicial Review would be a matter exclusively within the domain of the Federal and the State government.

He submitted that the matter in dispute is the Sabah Special Grant as Article 112C has rightfully pointed out the formula of the 40 per cent which is subject to be reviewed under Article 112D. 

He cited the first Review was commenced in 1969 and the Second Review in 2022, in which there was a joint statement in relation the second review between Federal Government and Sabah government and submitted that there is the agreement between the governments and there is ongoing review and negotiation between both governments.

The matter of the 40 per cent is still negotiable between the two governments. As a matter of fact, the subject matter which is a review is a matter that is exclusive between the Federal and State governments. And that is why we come on the grounds of locus standi. 

The one who would be affected would be these two parties, submitted the SFC.

The Federal Constitution has also provided a mechanism in the event both parties fail to reach a settlement, he submitted, among others, in pointing that the respondent has no locus standi to initiate a Judicial Review.

On justiciability of the subject matter, SFC Ahmad brought the attention to the High Court judgement note on the exclusively within the domain of the executive authorities and submitted that the High Court judge agreed that in relation to the amount of the special grant, it is in the domain of the both governments.

“Why we say the subject matter is non justiciable is because of what should be taken into consideration ... as to regard of amount of special grants it requires determination of the financial considerations and the needs of the Sabah state. This is beyond the powers of the Court to listen,” submitted SFC Ahmad.

To a question by the court on their response to the argument that nothing has happened between 1974 and now that there is a breach of a constitutional duty, SFC

Ahmad referred back to the application and grounds of the Judicial review, in which the first relief of certiorari is to quash part of the decision in the 2022 Gazette.

The second relief a declaration on the failure before the second Review and on the 40 per cent entitlement under Article 112C. Thirdly, for an order of mandamus directing respondent to hold another review in relation to the years 1974 up to 2021. 

“As I had shown on the joint statement issued by both government in the 2022 Review...that first, for the amounts to be increased starting from the year 2022-2026 and second part, that the matter of 40 per cent is still under negotiations. 

“Therefore, it covers everything but that have not been finalised and it covers all the complaints of SLS. 

“As a matter of fact, the grounds of the Judicial Review is everything all about the 2022 Gazette…ultra vires... We are not saying that Sabah is not entitled to the 40 per cent, we are saying that this is not the correct forum,” said SFC Ahmad.

Counsel Dr David Fung appearing for SLS submitted that the appellant has not answered the question.

“The question is what about the omission?  Today by 48 years, he submitted and cited Article 112D.

“The duty to pay is on the Federation i.e Malaysia. There is a primary duty to pay by Malaysia to the State. The two Governments have not been mentioned yet. That right is subject to a review. Two mandatory periods have been set, one 1969 and 1974. 

Because of the duty to pay 40 per cent annually, every year you have got to pay and the money has to go from the Federal consolidated fund to the state government fund, an income derived from the state of Sabah, when Sabah agreed to be part of Malaysia, submitted Dr Fung, and cited IGC report, that it would be so clear that the duty to pay is subject to a review.

“The problem with these two governments and I have to emphasise that both of the State and the Federal government had failed to hold the second review before the year 1974. 

“They then held it 48 years later. That is fine as long as the 1970 order is in existence. 

“So, we have a primary duty which the Federation has to face. Then, Article 112D says about the review...The announcement is just to the public but the Order omits to deal with 48 years. We have conveniently coined it for you as the lost years. 

“If they are putting the position that you can forget about 48 years and that they are still negotiating. But all the negotiations that are happening begins from 2021-2022. What happened to the 48 years?

“Are you saying that this is not justiciable? Are you saying that we can go on negotiating. Till today, 2024 and we have not remotely seen what 40pc is and they are still negotiating. We are not saying that they cannot negotiate. But we are asking what happened to the 48 years, said Dr Fung.

He also submitted that the Review Order 2022 disclosed that the decision made, following Article 112D review held on Feb. 12, 2022 instead of the mandate time of not later than 1974, wholly omitted providing for payment of the 40 per cent entitlement annually for the period between 1974 and 2021 –  48 years being ‘the Lost Years’

“It is the SLS case and we submit again that this was a serious breach of Federation constitutional duty to Sabah mandated under Article 112C read with Article 112D together with Section (2) in Part IV of the Tenth Schedule of the Federal Constitution.

Dr Fung also submitted that SLS has satisfied the “adversely affected” person to test to establish threshold locus standi to bring the judicial review for the interest of the public for the relief applied.