KOTA KINABALU, June 18 — The Court of Appeal dismissed the federal government’s appeal against the leave granted to the Sabah Law Society (SLS) to seek a judicial review of the state’s 40 per cent revenue grant.

Court of Appeal judges Datuk Ravinthran N. Paramaguru, Datuk Mohd Nazlan Mohd Ghazali and Datuk Choo Kah Sing delivered the ruling via online proceedings.

Justice Ravinthran, who read out the decision, directed the High Court to fix a date for full hearing of the judicial review application.

The federal government was appealing against the Kota Kinabalu High Court’s decision on November 11, 2022 to grant SLS leave to seek a judicial review of the matter to compel the return of 40 per cent of federal revenue earned from the state according to the Federal Constitution.

On November 11, 2022, Justice Ismail Brahim granted SLS’s application for leave for the judicial review, ruling that SLS had locus standi for judicial review as it was a public interest litigation.

The Attorney General’s Chambers (AGC) obtained a stay order to stop the High Court from hearing the merits of the case pending the appeal.

SLS filed the judicial review application in 2022 to overturn the federal government’s gazette of a RM125.6 million annual grant for Sabah, claiming that it violated the state’s revenue rights under the Malaysia Agreement 1963 (MA63).

Delivering the unanimous decision, Justice Ravinthran said the SLS has at the very least established local standi for judicial review as it is clearly a public interest litigation taken for the benefit of the public.

He said it was not taken to seek redress for a personal wrong or grievance of the SLS.

The judge further said the issue in the judicial review application involves high constitutional importance and it was taken to purportedly indicate a constitutional right accorded to the state of Sabah and therefore by extension for the benefit of the people.

"Whether there is merit in this application (judicial review) or otherwise is a matter that should be addressed in the full hearing (at the High Court),” he said.

Justice Ravinthran, however, said to shut out SLS from ventilating the issue on the grounds of local standi at this stage will definitely be a retrograde step and would not be in consonance with the recent development of law in this area.

He said that at this stage it cannot be said the subject matter (judicial review) is not justiciable, and SLS counsel had pointed out in the judicial review application that they were not challenging the lawfulness of the special grant for Sabah.

"If that were the case, it would immediately attract a justiciability argument as it is a matter agreed upon by the federal and Sabah governments.

"Neither is the SLS asking the court to conduct a review under Article 112D (of the Federal Constitution). A prayer to that effect would also attract the justiciability argument as the court is not equipped to handle such a matter,” the judge said.

He said the overarching focus of the judicial review application is the alleged omission in the Review Order 2022 to account for the missing ‘lost years’.

The ‘lost years’ is referred to by Sabahans as a 48-year period of a second mandatory review of the state’s 40 per cent revenue grant originally due by 1974, but was only undertaken in 2022.

Justice Ravinthran said in conclusion, the judges noted that the main issues raised by the appellant (federal government) lack merit given the factual and legal matrix of this unprecedented judicial review application.

"Therefore, we dismiss the appeal,” he said.

Senior federal counsels from the AGC, Shamsul Bolhassan and Ahmad Hanir Hambaly @ Arwi, as well as federal counsel V. Krishna Priya @ Venugopaland acted for the federal government, while SLS was represented by counsels Dr David Fung and Jeyan T.M. Marimuttu.

Sabah State Attorney General Datuk Nor Asiah Mohd Yusof and the Special Legal Advisor to the Chief Minister, Datuk Brenndon Keith Soh, appeared for the Sabah government as an intervenor.

Earlier, the panel wanted further confirmation of Messrs F.T Ahmad & Co’s withdrawal from the case and that all submissions made by the counsel for the Sabah government were also withdrawn, and Nor Asiah confirmed the matter.

Brenndon informed the panel that the state government would not appeal against today’s ruling and accepted the outcome for the matter to be fully ventilated on the merits at the substantive hearing of the judicial review. — Bernama