Federal Court rules ex-Selangor MB empowered to approve VSS payout on his own

 

Eight former staff of former Selangor menteri besar Abdul Khalid Ibrahim can keep the RM2.7 million paid to them as compensation in a voluntary separation scheme (VSS) in 2014.

This follows a unanimous decision by a Federal Court five-member bench led by Court of Appeal president Rohana Yusuf in allowing the former staff's appeal to set aside the appellate court's decision which went against them.

Justice Rohana said the Selangor Menteri Besar Incorporated (MBI), established under the MBI Enactment, is a sole legal entity.

She said that at the material time, Khalid was legally empowered to approve the VSS payment under the MBI Enactment on his own without the need for approval of the board of directors.

She said Khalid's power pursuant to the MBI Enactment was not fettered and not subject to the board of directors' approval.

Rohana also said MBI failed to establish that the approval of VSS payment was unlawful.

She said there was no requirement in the MBI Enactment or any of the law mandating MBI to be governed by the board, adding that the failure to obtain sanction of the board cannot be said to be a decision in breach of law or statute so as to render the decision unlawful.

Former Selangor menteri besar Abdul Khalid Ibrahim

Rohana set aside the Court of Appeal's decision and reinstated the decision of the High Court, as well as ordered MBI to pay RM50,000 in costs.

The other judges were Chief Judge of Malaya Azahar Mohamed and Federal Court judges Mohd Zawawi Salleh, Vernon Ong Lam Kiat and Zabariah Yusof. The proceedings were conducted via Zoom.

MBI filed the suit in May 2015 against the eight to reclaim the money paid to them via VSS in 2014.

Former chief executive of MBI Faekah Hussin was paid RM695,400 in compensation, and ex-chief operating officer Rohani Talib received RM524,400 while the other staff - Arfa’eza Abdul Aziz received RM478,935, Mustapha Mohd Talib (RM265,320), Rahimah Kamarudin (RM265,650), Sulaiman Masri (RM182,385), Abdul Halim Mohamed Yusof (RM186,300), and Tuan Nazuri Tuan Ismail (RM115,200).

The payments were made after Abdul Khalid resigned as the menteri besar on Sept 23, 2014, and Mohamad Azmin Ali was sworn in as his replacement.

The Shah Alam High Court in 2017 ruled that the compensation paid to the eight was valid but in 2018, the Court of Appeal reversed the decision.

Lawyer New Sin Yew represented the former staff while Masturina Mohamad Radzi appeared for MBI.

- Bernama