KOTA KINABALU: The Court of Appeals here reserved its judgement on the appeal by the Sabah State Government against the High Court’s decision to order them to pay damages to four dive operators on Sipadan Island for breach of legitimate expectations and loss of buildings.
Justices Datuk Mohd Hishamudin Mohd Yunus, Datuk Azahar Mohamed and Datuk Balia Yusof Haji Wahi deferred their decision to a date to be fixed after hearing submissions from both parties.
High Court judge Datuk David Wong Dak Wah had on October 19, 2010 allowed a suit brought by the four operators, namely Sipadan Dive Centre Sdn Bhd, Borneo Sea Adventures Sdn Bhd, Pulau Bajau Sdn Bhd and Sipadan Borneo Resort Management Sdn Bhd against the State Government and ordered that damages for breach of legitimate expectations be assessed by the registrar.
David ruled that the government had failed to give a reasonable notice to wind down the business of the four operators.
The judge also ordered damages to be assessed for loss of buildings in view of the government’s failure to give adequate notice to dismantle the structures.
He set interest at a rate of eight per cent per annum on the assessed amounts from the date of the judgement to full settlement of the same.
Earlier State Attorney-General (AG) Datuk Roderic Fernandez who acted for the state government among others, informed the court that the appellant is not the proper party in the suit.
He submitted that the respondents can have no proprietary rights or any rights at all over the Sipadan Island under the Land Ordinance (Sabah Cap. 68) as the island has been reserved as a bird sanctuary under Section 28 of the Land Ordinance since 1993 and up to now.
Fernandez further submitted that it was the National Security Council (NSC), not the appellant, which evicted the respondents and demolished the buildings and structures.
He pointed out that the respondents had in fact been given several notices since September 24, 2003 to vacate the island by December 31, 2004 and which was extended until February 28, 2005.
The State AG also told the court that the learned trial judge erred in ruling that the respondents have acquired some sort of legitimate expectations on Sipadan as such legitimate expectations if any would be in breach of the statutory provisions of the Land Ordinance.
Meanwhile, counsel Alex Decena who acted for Sipadan Dive Centre and counsel Shireen Sikayun for the three other operators, urged the court to dismiss the appeal with costs on grounds among others that the appellant is the proper party in this suit and even though the island has been reserved as a bird sanctuary since 1993 and up to now, the respondents have acquired rights as licensees over the island and not necessarily under the Land Ordinance.
Decena told the three panel of judges that the learned trial judge rightly held that the respondents had acquired some sort of legitimate expectations.
He said that the trial judge found that the appellant had created a legitimate that the respondents would be allowed to continue operating on the island even after Malaysia had gained sovereignty over the island.
The counsel pointed out that the judge also accepted the undisputed evidence that the appellant had actively used the respondents’ presence on the island to promote Malaysia’s tourism industry and to argue Malaysia’s sovereignty rights over the island at the International Court of Justice.
Decena further argued that even though the respondents have been given several notices as submitted by the State AG, the learned trial judge rightly found that the respondents had not been given reasonable or adequate notice to demolish and remove all buildings and structures on Sipadan Island and that such notice should have commenced from January 1, 2005.
The four operators filed the suit on March 1, 2007, and named the State Government as the sole defendant to seek a declaration from the court that they were entitled to be compensated for the demolition of their buildings and/or loss of their proprietary interests in their dive sports on Sipadan Island and/or breach of their legitimate expectations.
They were seeking more than RM6 million in special damages from the State Government on the losses incurred from the demolition of their lodges and resorts on the island.