Court Of Appeal Reinstates Sabah Forest Industries Licence Cancellation Challenge

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The court also dismisses the state government's application to strike out the appeal.
The Court of Appeal found that the cancellation of Sabah Forest Industries Sdn Bhd’s timber licence agreements had adversely affected the company’s business assets.PETALING JAYA: The Court of Appeal has reinstated Sabah Forest Industries Sdn Bhd’s (SFI) application for leave to commence judicial review proceedings to challenge the Sabah government’s cancellation of its timber licence agreements nine years ago
A three-member appeals court panel unanimously reversed a ruling by the Kota Kinabalu High Court handed down on Nov 16, 2022.
The High Court had struck off SFI’s suit seeking an injunction to preserve the status quo pending the disposal of separate arbitration proceedings.
It had held that SFI’s receivers and managers, Grant Thornton, lacked authority to act in respect of the company’s timber licence agreements which did not form part of the charged assets.
However, in its decision today, the Court of Appeal ruled that the receivers and managers were agents of the company and empowered to bring and defend proceedings in the company’s name.
In a statement, Grant Thornton’s executive director Geoffrey Foo said the appeals court also found that the cancellation of the agreements had adversely affected the company’s business assets and its charged assets.
He said the bench, comprising Justices Azhari Kamal Ramli, Ahmad Kamal Shahid and Ong Chee Kwan, also remitted the case to the High Court for the leave application to be heard.
Earlier, the appellate court dismissed an application filed by the state government on July 15 to strike out the appeal.
SFI had taken the state government to court after it cancelled its timber licence agreements following the closure of its pulp and paper mill in November 2016.
Grant Thornton was represented by AG Kalidas, Jeyan Marimuttu, S Vanugopal and Vanessa Marimuttu, while the state government was represented by counsel Firoz Hussein and Tengku Ahmad Fuad. - FMT

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