High Court orders Jakel Group’s Mohamad Nizam to pay RM1.5m over ‘forced’ contracts agreement

KUALA LUMPUR, Aug 30 — Jakel Group’s Datuk Mohamad Nizam Mohamad Jakel has been ordered by the High Court to pay RM1.5 million to three shareholders after they were forced to enter into several agreements with him through forced coercion and suffered economic duress as a result. 

According to Free Malaysia Today, judicial commissioner Ong Chee Kwan in delivering his 115-page judgement said Mohamad Nizam had threatened to take away the shareholders’ contracts in the development of systems to vet entries of foreigners into Malaysia which ran into millions of ringgit unless they transferred shares to the company of his wife, Norhana Sharkhan.

In the judgement, Ong said he found Mohamad Nizam’s conduct was “so intolerable” that he had to award exemplary damages amounting to RM500,000 each of the three shareholders.

“I do agree that this is indeed a proper case where exemplary damages ought to be imposed. Mohamad Nizam’s main objective was to extract money to be derived by the plaintiffs from the scheme,” he said.

The judge said Mohamad Nizam contributed nothing to the systems but wanted the benefits from the efforts put in by the plaintiffs.

“In carrying out his objective, Mohamad Nizam blatantly blackmailed the companies into giving him exorbitant amounts and substantial control over the companies,” he said.

Ong said Mohamad Nizam’s actions had inflicted fear, distress and hopelessness upon Aminul Islam Abdul Nor (also known as Amin) and the plaintiffs.

He said there was economic duress and illegality due to influence peddling, and it would be unjust enrichment if Mohamad Nizam or Norhana were allowed to hold the shares.

“Such actions also would have a crippling effect on the ability of meritorious companies dealing with the government of Malaysia,” he said, adding that Mohamad Nizam would come out of this episode no worse off as he never had the shares of the companies to begin with if exemplary damages were not awarded.

In his ruling, Ong also ordered the shares to be transferred back to the companies as soon as possible and also declared the agreements void.

The court also ordered Mohamad Nizam to pay RM360,000 in costs to the plaintiffs who were represented by Tan Sri Tommy Thomas, K Shanmuga, V. Jeya Kumar and Jonas Lee Fook Khong.

The plaintiffs — JR Joint Resources Holdings Sdn Bhd, Mohd Zaki Jaafar and SH Yahya SH Mohamed — also filed separate suits against Norhana.

JR Joint Resources, Zaki and SH Yahya are shareholders of the three corporate entities, Bestinet Sdn Bhd, Tass Tech Sdn Bhd and Synerflux Sdn Bhd.

By way of several agreements, Norhana received 49 per cent of the share capital of Bestinet, and 70 per cent in both Tass Tech and Synerflux.

The companies were focused on developing and implementing proprietary software solutions or platforms designed to assist the government through the Home Ministry in the area of recruitment of migrant foreign workers by Malaysian employers, and to screen passengers entering or exiting the country.

In their suit, the plaintiffs claim that the defendant had by illegitimate means exerted undue pressure and had coerced the transfer of their respective shares in the companies that developed the software, to Norhana.

This was accomplished by threatening to interfere with the plaintiffs’ negotiations and contracts with the government using the defendant’s close connection and influence with “powerful persons” within the government.

The plaintiffs, who filed their suits in late 2018, said the agreements signed with the defendant came about due to economic duress, coercion, illegality, failure of consideration, breach of condition and unjust enrichment.

They also sought declarations that the agreements are legally bad and must be struck down and the shares must be returned, all of which were allowed by the court.