Kerajaan Negeri Kelantan v Petroliam Nasional Berhad (W-01(NCVC)(W)-145-05/2015)

KERAJAAN PERSEKUTUAN MALAYSIA …RESPONDENTS [In the High Court in Malaya at Kuala Lumpur Civil Division, Civil Suit No.: 21NCVC – 21 - 2011 BETWEEN KERAJAAN NEGERI KELANTAN …PLAINTIFF

KERAJAAN PERSEKUTUAN MALAYSIA …DEFENDANTS] 2 CORAM: ABDUL AZIZ BIN ABDUL RAHIM, JCA UMI KALTHUM BINTI ABDUL MAJID, JCA BADARIAH BINTI SAHAMID, JCA GROUNDS OF JUDGMENT A.

This was an appeal by the Kelantan State Government against the decision of the learned High Court Judge delivered on 10.4.2015 in rejecting the 14 issues submitted by the Kelantan State Government for a proceeding under Order 14A of the Rules of the High Court 1980 (RHC).

For the purpose of this appeal, the parties will be referred to as they were in the High Court. B.

The Kelantan State Government (the “Plaintiff”) filed a civil suit against Petroliam Nasional Berhad (the “First Defendant”) vide Writ of Summons and Statement of Claim dated 30.8.2010.

The Federal Government of Malaysia (“the Second Defendant”) was brought in later as a party to this suit. 3

The First Defendant had on 30.3.2011 filed a Summons in Chambers in Enclosure 16 for an application under Order 14A of the RHC and on 21.4.2011 the Second Defendant filed another Summons in Chambers for an application under Order 14A of the same.

The First Defendant formulated six issues of law to be determined and the Second Defendant had formulated three issues of law to be determined by the High Court. The three issues formulated by the Second Defendant were identical with the first three issues formulated by the First Defendant. Thus, in essence, the Defendants had put forward six issues of law to be determined by the Court.

It is pertinent to note that from the very beginning, the Plaintiff took the stand that this civil suit is complex and this was evident from the particulars pleaded in the Plaintiff’s Statement of Claim and the substantial replies to the Defences which pleaded several causes of action including “breach of statutory contracts”, unfair discrimination, estoppel and violation of Articles 8 and 13 of the Federal Constitution.

The High Court then allowed both of the Defendants’ Order 14A applications on 18.1.2012. The matter went up for appeal before the Court of Appeal and the appeal was dismissed on 26.4.2012. The Plaintiff further appealed to the Federal Court, upon leave being granted, and the Federal 4 Court dismissed the Plaintiff’s appeal. At this stage, it was decided that the Plaintiff’s suit shall be determined by way of an Order 14A proceeding.

On 19.9.2014, during a case management at the High Court, the Plaintiff informed the Court that it was of the view that there are other questions of law that needed to be determined by the High Court, apart from the six questions of law formulated by the Defendants. As such, the learned High Court Judge directed the parties to formulate a set of agreed facts and the questions of law to be determined by the Court.

The counsel for the Plaintiff then prepared a “Proposed Questions and Issues of Law” comprising of a total of 14 questions and issues.

The learned counsel for the Defendants took a common view that the Plaintiff’s suit ought to be determined solely on the questions and issues of law as framed by the Defendants. This contention was premised on the fact that these questions and issues of law had been approved and endorsed by the Court of Appeal and the Federal Court. Thus, the Defendants were of the view that the Plaintiff was not in the position to either introduce or add further questions and/or issues of law.

The learned High Court Judge had, on 10.4.2015, ruled that the hearing of the Plaintiff’s claim against the Defendants shall be determined 5 based on the questions and issues of law as framed by the Defendants and disallowed the addition of the 14 questions and issues by the Plaintiff.

In coming to the decision to proceed with the hearing of the Order 14A applications with questions and issues of law formulated by the Defendants, the learned High Court Judge had made a reference to the Federal Court decision where the Federal Court dismissed the Plaintiff’s appeal (see Kerajaan Negeri Kelantan v Petroliam Nasional Bhd and other appeals [2014] 6 MLJ 31).

The learned High Court Judge stated that the Federal Court decision was quite clear in that it agreed that the core issue in this case is whether the Plaintiff has any rights over the petroleum won and saved in the continental shelf off its coast and that this issue can be determined based on the questions and issues of law framed by the Defendants.

The learned High Court Judge was also of the view that it was no longer open for the Plaintiff to either introduce and/or to add additional questions or issues of law when the Federal Court had ruled that the questions and issues of law framed by the Defendants had passed the threshold under Order 14A of the RHC. 6

The learned High Court Judge was of the view that these issues had been ventilated and considered by the Federal Court and the Plaintiff was not prejudiced by the said decision.

The Plaintiff, after having maintained its position from the outset that the matter should not have been resolved by way of an Order 14A application due to the complexities of the issues involved, the Court held that it must now adhere to the decision of the Federal Court. The Plaintiff now finds itself in a position where it is prohibited from adding and/or formulating its own questions and issues of law to the Order 14A proceeding.

The Plaintiff vehemently opposed the contention that the civil suit ought to be determined solely and exclusively on the issues formulated by the Defendants.

The Plaintiff argued that by doing so, it would be against the fundamental spirit and the basic tenet of justice and fairness in civil trial. The Plaintiff argued that its right to be heard on its own claim and to address its grievances before the Court would be denied. The Plaintiff is entitled to have all the issues pleaded in its Statement of Claim and the Statement in Reply to be ventilated before the Court. The Plaintiff’s right to put forward all the evidence and to advance all arguments must not be 7 denied. By not allowing the Plaintiff to formulate and/or to add its own questions would prejudice the Plaintiff. D. THE APPEAL Whether appeal is not a decision under Section 3 of the Courts of Judicature Act, 1964

Section 3 of the Courts of Judicature Act 1964 (CJA) provides that - Interpretation

In this Act, unless the context otherwise requires- … “decision” means judgment, sentence or order, but does not include any ruling made in the course of a trial or hearing of any cause or matter which does not finally dispose of the rights of the parties;… Meanwhile, section 67 of the CJA further provides that - Appellate Jurisdiction – Civil Appeals Jurisdiction to hear and determine civil appeals 67.

We disagreed with the contention of the learned counsel for the First Defendant that there was no “decision” made by the learned High Court Judge. The First Defendant had submitted that there was no competent appeal before this Court as the learned High Court Judge had only made a “ruling”, not a decision. We disagreed with this submission as we were of the view that under section 67 of the CJA, the ruling of the High Court Judge is appealable. The Plaintiff has the right to appeal on this particular ruling made by the learned High Court Judge because the outcome of this ruling has a serious impact on the Plaintiff’s case at the High Court as some of the issues pleaded in the Plaintiff’s Statement of Claim may not have been ventilated in its entirety. In this context, we found the “ruling” by the learned High Court Judge had “finally” disposed of the rights of the Plaintiff, if any, to that extent and had seen it fit to write her Grounds of Judgment for her “ruling”. Whether the Plaintiff ought to be precluded from advancing its own proposed questions of law to be determined by the Court

The First Defendant also contended that the Plaintiff, by opposing the Order 14A applications must now abide by its election and cannot now argue before the High Court that it is unfair and unjust for the Plaintiff to be subjected to the proposed questions of law put forth by the Defendants 9 and as affirmed by the Federal Court only. The First Defendant further submitted that no further issues are admissible at this stage since the Order of the Federal Court is final and binding.

The Second Defendant submitted that it is not open for the Plaintiff to frame new questions of law for the High Court’s consideration as the relevant questions had already been determined by the learned High Court Judge much earlier (on 18.1.2012). On appeal to the Court of Appeal and the Federal Court, the Federal Court had affirmed those questions of law allowed by the learned High Court Judge to be the questions of law to determine this action.

Having considered the submissions of the counsel for the Defendants on this issue, we were of the view that the Plaintiff is entitled to propose its own questions of law in addition to the Defendants’. We were of the view that in the interest of justice and fair play, it is only appropriate for the Plaintiff to be allowed to submit its own questions of law to the High Court and then it would be for the High Court to exercise its discretion whether or not any of the additional questions are appropriate for a determination under Order 14A proceedings. The denial of the Plaintiff of this opportunity would, in our view, be wholly unacceptable and against the basic principle of justice and fairness in a civil trial. The Plaintiff would be denied its right to be heard on its claim in its entirety and to 10 address its grievances wholly before the High Court. The fact that the Plaintiff’s claim will be determined vide Order 14A proceeding must not negate nor reduce the Plaintiff’s right to have its case properly ventilated before the High Court.

It is also pertinent to note that the Plaintiff had all along strongly objected to the applications by the Defendants for this action to be determined vide Order 14A proceeding. As such, and in line with its objection, it would be inconsistent for the Plaintiff to at the same time propose its own questions of law then. Only when it was conclusively determined that the civil suit will be disposed by way of Order 14A, is Plaintiff left with no choice but to put forward its own questions of law for consideration of the High Court. Thus, we were of the view that the Plaintiff ought not to be precluded from proposing its questions of law now just because at the earlier stage it was merely exercising its right to object to the applications made by the Defendants.

We were also of the view that nowhere in the decision of the Federal Court is the Plaintiff precluded nor prohibited from formulating its own questions of law for the determination under Order 14A proceeding. In our view, the crux of the decision of the Federal Court was only in respect of the objection made by the Plaintiff as to the appropriateness of the mode of disposal of the matter in dispute, that is, whether it should be by way of 11 Order 14A application or by way of a full trial by the calling of witnesses. The decision of the Federal Court was, insofar as this appeal was concerned, on the appropriate mode of disposing of the matter and only took into account the formulation of the questions of law that are to be used for the hearing of Order 14A application to that end. We noted that the learned High Court Judge felt that she was bound by the decision of the Federal Court not only in regard to the mode of disposal of the suit but also in regard to the questions of law formulated by the Defendants; she therefore had failed to exercise her discretion despite the fact that she had earlier on in the case management stage directed parties to formulate a set of questions of law to be determined by the Court.

Based on the aforesaid reasons, we unanimously allowed the appeal and ordered as follows:

27.1 the matter shall be remitted back to the High Court for the Plaintiff to put to the High Court the 14 questions proposed for determination by the learned High Court Judge on whether all or any of the 14 questions are appropriate for determination under Order 14A proceeding together and in addition to, the 9 questions already posited by the Defendants; 12

27.2 in determining the appropriateness of the question for determination, the High Court may give appropriate direction to the parties; and 27.3 the costs shall be in the cause. sgd (UMI KALTHUM BINTI ABDUL MAJID) Judge Court of Appeal Malaysia Putrajaya Dated: 19.10.2018 Counsels/Solicitors: For the Appellant : Mr. Tommy Thomas together with Dato' Takiyuddin Hassan Miss Sitpah Selvaratnam, Miss Rahayu Mumazaini from Messrs. Tommy Thomas. For the First Respondent: Tan Sri Cecil W M Abraham together with Mr Rishwant Singh from Messrs. Cecil Abraham & Partners For the Second Respondent: Puan Suzanna Binti Atan, Senior Federal Counsel, Attorney General’s Chambers, Putrajaya.