40% revenue rights: Sabah lawyers to know fate on judicial review on May 16

KOTA KINABALU: In two weeks, the Sabah Law Society (SLS) will face the Federal Government in a crucial court hearing.

The Court of Appeal will hear the Federal Government's appeal against a Kota Kinabalu High Court decision on May 16 to grant Sabah lawyers leave for judicial review on Putrajaya's constitutional duty to pay 40% to the state.

SLS’ immediate past president, Datuk Roger Chin, said this case holds immense significance for Sabah.

“This upcoming court battle marks a pivotal moment in the fight for Sabah's rightful constitutional entitlement.

“The outcome will significantly impact the future development of the state and its people, potentially paving the way for long-overdue progress and a brighter future for Sabah,” he said in a statement on Thursday (May 2).

Chin underscored the SLS’ determination to secure recognition and fulfilment of the 40% entitlement enshrined in Articles 112C and 112D of the Federal Constitution, alongside Section 2 of Part IV of the Tenth Schedule.

“This entitlement represents two-fifths (40%) of the net revenue derived by Malaysia from Sabah, exceeding the amount collected in 1963, the year Malaysia was formed,” he said.

Chin noted that the hearing was supposed to be held eight months ago.

He said this hearing stemmed from the Federal Attorney General's challenge to a November 2022 High Court decision granting SLS the right to pursue judicial review against both the federal and Sabah governments.

“While the Attorney General contests SLS’ legal standing, the society firmly maintains its right to seek justice on behalf of the people of Sabah,” he said.

The Attorney General's Chambers (AGC) had then filed an application to set aside the Nov 11, 2022, Kota Kinabalu High Court decision allowing the SLS leave to seek judicial review on the 40% special grant for Sabah.

The AGC had also obtained a stay order to stop the Kota Kinabalu High Court from hearing the merits of the case pending the appeal.

The Sept 14 hearing was subsequently adjourned by the Court of Appeal, which then set the May 16 date after the SLS objected to the adjournment and put in a Certificate of Urgency before the court to show that the case was of considerable public interest and that it should be heard.

Chin said a critical gap remains despite the federal and Sabah governments both acknowledging their obligation by conducting two Article 112D reviews in 2022 and 2023 to determine the entitlement for the period 2022 to 2026/2027.

“The second mandatory review, originally due by 1974, was only undertaken in 2022, leaving 48 years unaccounted for – a period referred to as ‘the Lost Years’ by many Sabahans,” he said.

“The SLS also wishes to obtain a definitive court declaration that the 40% entitlement, as per the true intent of the constitutional provisions, should be interpreted and delivered faithfully, upholding the spirit of the Federal Constitution,” he said.

SLS filed for judicial review on June 9, 2022, to overturn Putrajaya's gazettement of the RM125.6mil annual grant for Sabah, saying it was not in accordance with the state's revenue rights under the Malaysia Agreement 1963 (MA63).

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