PUTRAJAYA: The ruling by a high court, on Sabah’s entitlement to 40% return of revenue rights, has been stayed by the Court of Appeal.
The appellate court granted the stay sought by the federal government pending the appeal against the Kota Kinabalu High Court’s judgment.
A three-member panel of Justices Mohamed Zaini Mazlan, Ismail Brahim and K. Muniandy heard the application yesterday.
Justice Mohamed Zaini held that the Federal Government, as the applicant, would be prejudiced if a stay was not granted.
“First, there is a real risk of non-compliance with the timelines imposed by the High Court which, given the scope and complexity of the exercise, seem onerous.
“Second, the impugned orders may not align with the constitutional framework under Article 112D of the Federal Constitution, particularly with respect to the mechanism for resolving disputes,” he said.
If the court order was enforced before the appeal is heard, this would deprive the applicant of an opportunity to voice its challenge against the decision.
The Court of Appeal also noted that the High Court’s order not only directed negotiations but also required the applicant to make payment from the Federal Consolidated Fund within 180 days of the High Court’s Order, which will end on April 15.
“This could have serious financial consequences, especially given the current challenging global economic climate.
“Under Article 112D, any review must consider the applicant’s financial position in relation to the needs of the second respondent (Sabah government). The imposed timelines may not give the parties enough opportunity to determine the correct quantum payable.
“The payments ordered are of such magnitude that their execution, prior to the determination of the appeal, would create a fait accompli (irreversible consequence),” Justice Mohamed Zaini said.
The court said it was also satisfied with the federal government’s assurance that it had no intention to delay proceedings and had taken measures to expedite the hearing of its appeal.
“We are therefore satisfied that special circumstances have been established.
“The applicant would suffer prejudice if a stay is refused, and the appeal may be rendered nugatory,” Justice Mohamed Zaini said.
The court made no order as to costs.
On Oct 17 last year, the High Court ruled that the federal government had acted unlawfully by failing to honour Sabah’s right to 40% of net federal revenue from 1974 to 2021.
The High Court ordered the federal government and Sabah to complete a review within 90 days and reach a final agreement within 180 days after granting the judicial review sought by the Sabah Law Society.
