Halim Saad fails to overturn High Court decision on Renong deal

by **Cals** Thu 28 Aug 2014, 18:18

Business & Markets 2014

Written by Tarani Palani of theedgemalaysia.com

Thursday, 28 August 2014 09:01

PUTRAJAYA: Tycoon Tan Sri Halim Saad yesterday failed in his bid to overturn a High Court decision to strike out his RM1.8 billion suit against Khazanah Nasional Bhd, the government and a former minister over his settlement to exit from Renong Bhd.
A three-member Court of Appeal panel, in a unanimous decision, ruled that the High Court judge was right in throwing out Halim’s case on the grounds that it was filed out of time.
“We find that the High Court judge’s conclusion that the plaintiff’s claim was obviously unsustainable on grounds that limitation period had set in, and the accord of satisfaction is correct,” said Appeals Court judge Justice Datuk Zahara Ibrahim.
“We have examined the appeal record, in particular the plaintiff’s letters, according to their chronological order.”
The other two judges on the panel were Justice Datuk Mah Weng Kwai and Justice Varghese George Varughese.
The panel awarded RM25,000 in costs to Khazanah, and another RM25,000 to former minister in the Prime Minister’s Department Tan Sri Nor Mohamed Yakcop and the government.
Halim filed the suit against Nor Mohamed, the federal government and Khazanah on April 17 last year, seeking to reclaim over RM1.8 billion in compensation for selling his stake in Renong.
The former majority owner and executive chairman of Renong claimed in his suit that there was an element of fraud in the compensation paid to him to leave Renong.
Besides the payment of RM165 million to cover loss of capital, Halim claimed that there were many other amounts payable to him, including a RM100 million put option.
The tycoon said in his statement of claim that in 2001, he held a 16% stake in Renong, making him the single largest individual shareholder in the company.
He said in November 2002, Nor Mohamed was appointed a director of Khazanah and at all material times, Renong held a substantial stake in United Engineers (M) Bhd (UEM).
Halim claimed he was induced by Nor Mohamed, as an agent representing the government, to take up the deal for his exit from Renong and UEM.
Halim sought RM1.3 billion in general damages for alleged breach of the Renong purchase obligation, and another RM508 million being the value of the paid-up capital of Kualiti Alam Sdn Bhd in settlement of his losses for rescuing Fleet Group, and damages for fraudulent misrepresentation.
On Oct 31 last year, High Court Judge Hanipah Farikullah struck out the case even before hearing began, saying it was filed beyond the six-year period stipulated by the Limitation Act for actions of contract.
In the appeal submissions at the Court of Appeal, the main point raised was the time when Halim was aware that there would be no further payment for the deal.
Halim’s lawyers, led by Robert Lazar, argued that Halim only knew for certain that there would be no more payments in 2010, and that the suit therefore stands.
“Only in 2010 there was misrepresentation of the fraud [in the context of contract law], therefore limitation cannot run ... it was only brought home in 2010 when he was told there was no intention to pay him anything,
“That was our case but [the] learned judge didn’t deal with it on that basis,” he said, adding that the High Court judge made the conclusion that Halim found out there won’t be further payments through a correspondence in 2002.
Lazar also cited many other instances where a decision was arrived at from a pure finding of fact when the facts were contested.

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Halim has sought RM1.3 billion in general damages for alleged breach of the Renong purchase obligation.

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“This was not a plain and obvious case. It is so factual, [and ] should be given the opportunity to go to the witness box and testify,” he argued.
Khazanah’s counsel Datuk Nitin Nadkarni, however, argued that through a series of correspondence from 2002 to 2003, Halim was fully aware that there would be no further payments made.
Among others, he cited a letter from former prime minister Tun Dr Mahathir Mohamed dated Oct 31, 2002 where he said that the suggested payment of RM165 million was approved by him and that it was final. Dr Mahathir said Halim should accept the suggested amount so as not to prolong the matter further.
Counsel also said that since 2003, no letter of demand had been issued by Halim and he had instead filed the writ summons 10 years later.
Gopal Sreenevasan, another counsel who acted for Halim, said they would await instructions from their client on whether to file an appeal with the Federal Court. Senior Federal Counsel Suzana Atan represented Nor Mohamed and the government.

This article first appeared in The Edge Financial Daily, on August 28, 2014.
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