Former 1MDB CEO Arul Kanda Kandasamy and its former chairperson Mohd Irwan Serigar Abdullah failed to strike out the sovereign wealth fund’s lawsuit against them.
The civil court this afternoon denied the two defendants’ application to nullify 1MDB’s lawsuit without the matter being subjected to full trial.
Judicial commissioner Raja Ahmad Mohzanuddin Shah Raja Mohzan ruled that it was not sufficient for the matter to be resolved on a mere exchange of affidavits regarding 1MDB's losses due to embezzlement at the troubled company.
Raja Ahmad said that a full trial of the lawsuit is necessary to hear out parties' submissions over the allegations of fraud, which cannot be disposed of in a summary manner.
The judicial commissioner said among these issues that need full trial are whether Arul Kanda and Irwan Serigar - who joined 1MDB between January 2015 and May 2016 - could be held responsible for failing in their contractual duties in relation to dealing with the alleged fraudulent transactions between 2009 and 2014.
Raja Ahmad assured the two defendants that the civil court would give equal consideration to their arguments as well as those of plaintiff 1MDB, reiterating that all parties before him are on equal footing.
"I need to hear witnesses from both parties. I maintain the status quo of parties and for the matter to proceed for a full trial.
"This is not an obvious matter for striking out but requires this court to investigate via full trial.
"Justice would still come to the rightful party, and it merely takes a longer journey to achieve it," he said.
The judicial commissioner ordered Arul Kanda and Irwan Serigar each to pay RM10,000 costs to 1MDB and also set Sept 14 for case management of the matter.
Counsel Lim Chee Wee, Brendan Navin Siva, Aida Haryani Salamon, and Wong Sze Some appeared for 1MDB.
Arul Kanda (above, left)was represented by lawyers Lee Leong Soon and Hing Hong Jer, while Irwan Serigar’s (above, right) legal team comprised counsel Lavinia Kumaraendran, Mavin Thillainathan, and Amitaesh Theva.
Breach of trust
In May 2021, 1MDB filed a civil suit against Arul Kanda and Irwan Serigar over an alleged breach of trust and conspiracy that caused the fund to suffer losses amounting to US$1.83 billion (RM8.05 billion).
The loss was over its investment in the joint venture 1MDB-Petrosaudi Limited, which was converted into the purported Brazen Sky Limited investment that is contended to be found in the Bridge Global Fund.
1MDB alleged that the duo committed a breach of trust and conspiracy by misappropriating its funds amounting to US$3.5 billion (RM15.4 billion), which was allegedly paid to Aabar Investments and US$1.265 billion that was purportedly paid to International Petroleum Investment Company (IPIC), on May 9, 2017.
The plaintiff alleged that defendant Irwan also conspired with co-defendant Arul Kanda to cause the company to implement the Employment Extension Agreement, which resulted in a payment of RM2,905,200 to Arul Kanda in accordance with the agreement, regardless of 1MDB’s interests.
Through the lawsuit, 1MDB sought for the duo to pay US$6.59 billion for the alleged breach as well as for Irwan to pay RM2.9 million in relation to the Employment Extension Agreement. - Mkini
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