The Court of Appeal has granted Sabah Forest Industries Sdn Bhd leave to commence a judicial review challenging the Sabah government’s cancellation of its timber licence agreements.
Grant Thornton, the audit, tax and advisory firm which acted as SFI’s receiver and manager, said the appellate court comprising a three-member bench dismissed an application filed by the state government on July 15 to strike out the appeal.
In a statement today, Grant Thornton executive director Geoffrey Foo also said the Court of Appeal overturned a 2022 decision by the Kota Kinabalu High Court which dismissed SFI’s suit against the state government.
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.
The High Court had then struck out the suit by SFI on grounds that Grant Thornton “lacked the authority” to act in respect of SFI’s timber licence agreements on grounds that they were not among the charged assets to which the receiver and manager had been appointed.
However, Foo said the appellate court agreed that the judicial review application initiated by the receiver and manager arose following the cancellation of the agreements.
“In this regard, the receiver and manager is empowered to bring and defend proceedings in the name of the company and on its behalf,” he said.
He said the Court of Appeal also found that the cancellation of the agreements adversely affected the company’s business assets and the charged assets.
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.
