Sabah's 40% revenue rights: SLS to get its day in court after AG's appeal dismissed

KOTA KINABALU: The Sabah Law Society (SLS) has been granted the right to proceed with a judicial review of the state’s constitutional right to receive 40% of its special grant revenue.

On Tuesday (June 18), the Court of Appeal dismissed the Federal Attorney General’s appeal against a High Court decision to grant SLS leave to challenge grant provisions.

In dismissing the appeal via online proceedings, a three-member panel decided that SLS has locus standi for the review.

Justice Datuk Ravinthran Paramuguru said the two main issues raised by the Senior Federal Counsel (SFC), namely locus standi and justiciability, lacked merit given the factual and legal matrix of the unprecedented application for judicial review.

ALSO READ: Lawyer: RM16bil for Sabah not the same as 40% in MA63

“We unanimously dismiss the appeal. If this matter is not taken up further by the appellant, we direct the High Court to fix a date for the full hearing of the judicial review application,” he said.

He also gave no order as to costs seeing that this is a public interest case.

Before delivering the decision, Justice Ravinthran said SLS had, at the very least, established threshold locus standi.

He said the judicial review application was clearly taken in the public interest, for the benefit of a section of the people, and not to seek redress for a personal wrong or grievance.

He said the issue to be addressed in the judicial review application also involved a matter of high constitutional importance.

“It is taken to purportedly vindicate a constitutional right accorded to the state of Sabah and therefore by extension, for the benefit of the people of Sabah,” said Justice Ravinthran.

He said whether or not there is merit in the application was a matter to be addressed in the full hearing.

ALSO READ: Sabah withdraws objection and counsel

On the aspect of justiciability, he said courts have expressed the view that if a matter is not justiciable, leave to commence judicial review may be refused.

He said the learned SFC submitted that the judicial review application was not justiciable for several reasons, including that the review under Article 112D(2) of the Federal Constitution has to take into account the ability of the Federal Government and the needs of the Sabah government.

The SFC had said these involved policy matters that the court was not equipped to deal with, that the review was only between the Federal and state governments, and that the Special Grant given in Review Order 2022 was made by way of offer and acceptance.

Counsel for SLS argued that the issues to be determined were legal matters that did not require policy considerations, nor did they involve broad discretion that the court was ill-equipped to handle.

Furthermore, it was argued that SLS was not challenging the Special Grant given in the Review order 1970 or 2022 but merely urging the court to rule on the omission of so-called "lost years" that are a matter of constitutional interpretation.

“In our view, at this stage, it cannot be said that the subject matter of the judicial review application is not justiciable,” said Justice Ravinthran.

“For the above reasons, we are not persuaded that the matter is prima facie not justiciable,” he said.

ALSO READ: SLS says Sabah govt's support on 40% revenue rights review a morale booster

The case revolves around the Kota Kinabalu High Court’s decision to grant SLS the right to seek judicial review of Sabah's revenue rights and compel the return of 40% of federal revenue earned from Sabah.

On Nov 11, 2022 Justice Ismail Brahim granted SLS application for leave for the judicial review, ruling that the group had locus standi to do so as it was a matter of public interest.

Justice Ismail also found that SLS’ case concerned a breach of constitutional duty to pay the 40% entitlement for the “lost years” of 1974–2021.

SLS is seeking a declaration that the new 2022 Order agreed to by the Sabah government is unconstitutional and to compel both Federal and state governments to hold another review to include the 40% Special Grant paid to Sabah.

In Tuesday's proceeding, the Attorney General was represented by SFCs Shamsul Bolhassan, Ahmad Hanir Hambaly @ Arwi and Krishna Priya Veenagopal @ Venugopal, while SLS was represented by David Fung Yin Kee, Jeyan Marimuttu and Janice Junie Lim.

Counsel Datuk Nor Asiah Mohd Yusof appeared for the Sabah Attorney General and Datuk Brenndon Keith Soh represented the state government.

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