Thursday, February 2

SLS challenging Second Review Order

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KOTA KINABALU (June 10): The Sabah Law Society (SLS) has taken legal steps to challenge the Second Review Order under Article 112D of the Federal Constitution.

This is because SLS is of the opinion that the Second Review Order under Article 112D of the Federal Constitution as gazetted is in serious breach of Article 112C and 112D (1), (3) and (4).

SLS in a statement on Friday explained that on April 20, 2022 the Federal Government of Malaysia published Review Order in the Federal Gazette.

That was purportedly Second Review Order under Article 112D of the Federal Constitution.

What the Second Review Order stated is that the Federal Government and State Government of Sabah have reached an agreement as to the Review of the 40 per cent Special Grant Entitlement of Sabah under Article 112C of the Federal Constitution.

However, prior to that Second Review Order, there was a joint announcement by the Federal Government and State Government on April 14, 2022.

This was said to be without prejudice an agreement reached between the Federal Government and the State Government as to the payment of the Special Grant of 40 per cent. It was also mentioned in the announcement that both the Federation and the State were continuing to negotiate.

“We are of the view that the Second Review Order as gazetted is in serious breach of Article 112C and 112D (1), (3) and (4). In substance SLS action in court now is to challenge that Second Review Order, among others.

“The action now commenced by SLS against the Federal Government is a Judicial Review proceeding for certiorari to quash that Second Order in so far it contravenes the specific provisions of the Federal Constitution, more particularly Article 112C and 112D read together with the Tenth Schedule Part IV thereof.

“We are of the view that under Article 112D (3) it is incumbent upon the Federal Government to hold a Second Review in 1974. The Federal Government failed or neglected to hold that Second Review,” the statement read.

SLS opined that this is in clear contravention of the express provisions of the Federal Constitution and the contravention is to the detriment of the people of State of Sabah.

It alleged that by failing to hold that review for periods from 1974 to 2021 the people of Sabah have lost the benefit of the 40 per cent entitlement of right under the Federal Constitution. These are revenues lost yearly.

“This right and entitlement is sacrosanct as enshrined in the constitution foundation documents and indeed the Constitution itself. SLS’s present action is for the preservation of the constitutional rights of the people of Sabah,” it stressed.

SLS pointed out that the Review now published in the recent Federal Gazette on 20th April 2022 is only in respect of years 2022 to 2026. It has failed to address the lost years from 1974 to 2021.

Under Article 112C read together with Part IV of Tenth Schedule, Sabah is entitled to the Special Grant of 40 per cent as calculated in accordance with the formula set out under Part IV of the Tenth Schedule.

Article 112D (3) and (4) must be read in tandem with Article 112C as well Part IV of the Tenth Schedule, said SLS, adding that Article 112D (1) provides that Review shall be held at the intervals as mentioned under Article 112D (4) which provides that “shall be held as regards both States of Sabah and Sarawak for periods beginning with the year 1969 and the year 1974…’

“While the Federal Government has held Review for period of five years beginning in 1969, it failed to do so for period begging from 1974. This is clear contravention of the mandatory provision of Article 112D (4).

“Having, failed to hold a Review in terms of Article 122D (4) they cannot rely on the First Review which is for the period from 1969 to 1973 to say that it would continue to be effective until the next Review,” SLS stressed.

“The next and Second Review must have been held with the beginning of 1974,” SLS said, adding that SLS’s present action is substantially for the following remedies and orders namely that the applicant be granted leave to apply for an order of certiorari to remove into the High Court for the purpose of quashing such part of the decision contained in Gazette publication P.U. (A) 119/2022 dated 20.4.2022 as is or is implied to decide and publish that the duty of the respondent is otherwise than is as declared under paragraphs 2 (a) and 2 (b) herein.

“A declaration that (a) That the failure of the respondent to hold the second review in the year 1974 with the State Government of Sabah is a breach and contravention of its constitutional duty stipulated under Article 112D, Clauses (1), (3) and (4) of the Federal Constitution.

“(b) That the 40 per cent entitlement under Article 112C read with subsection (1) of section 2 of Part IV of the Tenth Schedule of the Federal Constitution means an annual special grant of two-fifths of the amount by which the net revenue derived by the first respondent from the State of Sabah exceeds the net revenue which would have been derived in the year 1963 wherein net revenue is the revenue which accrues to the Federation less the amounts received by the State of Sabah in respect of assignments of that revenue under Part I and V of the Tenth Schedule of the Federal Constitution as depicted by the formula as shown:
⁃   Federal Revenue derived from Sabah in current Year
⁃   Revenue Assigned to State [Part III and V 10th Schedule]
⁃   Net Revenue derived from Sabah in current Year [A – B =C]
⁃  Federal Revenue derived from Sabah in 1963
⁃  Revenue assigned to Sabah in 1963
⁃  Net Revenue derived from Sabah in 1963 [D – E = F]
⁃  Special Grant due to Sabah in Current Year: 40% x (C – F) =G
(b) That the 40% entitlement remains due and payable by the respondent to the State Government of Sabah for each consecutive financial year for the period from the year 1974 to the year 2021.
(C) That a failure to pay the 40% entitlement by the respondent to the State Government of Sabah for each consecutive financial year for the period from the year 1974 to the year 2021 is a breach of the fundamental right to property of the State Government of Sabah and ultimately of the people of Sabah as enshrined under Article 13 of the Federal Constitution.

For the following Orders:
(a) An order of mandamus directed to the respondent to hold another review with the State Government of Sabah under the provisions of Article 112D of the Federal Constitution to give effect to payment of the 40% entitlement under Article 112C read with subsection (1) of section 2 of Part IV of the Tenth Schedule of the Federal Constitution for each consecutive financial year for the period from the year 1974 to the year 2021 within 30 days and to reach a decision within 90 days from the date of this order.
(b) An order that the respondent pays the entitlement as determined under paragraph 3 (a) above to the State Government of Sabah or as constitutional damages for breach of Article 13 of the Federal Constitution or both.

On a final note, SLS is a statutory body established pursuant to section 7A of the Advocates Ordinance (Sabah Cap. 2) whose objects are set out and provided under Part VI of the Advocates Ordinance (Sabah Cap. 2) and more particularly section 13A thereunder.

Pursuant to the said section 13A, the applicant is vested with the necessary statutory powers and authority “to uphold the cause of justice without regard to its own interest or that of its members, uninfluenced by fear or favour and to protect and assist the public in all matters … relating, ancillary or incidental to, the law.

In furtherance of its statutory objectives, SLS is obliged by virtue of the statutory provisions as set out under section 13A (a) and (e) of the Advocates Ordinance (Sabah Cap. 2) to uphold and to ensure that the Federal Constitution is upheld at all times.