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Malaysia: Water Dispute Takes Centre Stage

14th March, 2014

This is an interesting case involving the Federal Government of Malaysia, Selangor State Government and a Trade Union.

In the Court of Appeal, the appellants filed an application to appeal against the decision of the High Court of 28 June 2010. By way of judicial review, the respondents were granted the following orders in their judicial review application before learned Judicial Commissioner.

  1. that a writ of certiorari to issue to quash the decision of the first appellant (the Minister of Energy, Water and Communication) (hereinafter shall be referred to as “the Minister”) refusing to publish and/or disclose an Audited Report and a Concession Agreement; and
  2. that a writ of mandamus to issue to compel the Minister to publish and/or disclose the Audited Report and the Concession Agreement to the respondents and/or to the public within seven days of the order.

In this case, until 15 March 2002, the Selangor Water Supply Department, a department under the Selangor State Government had been responsible for the distribution and treatment of water for the State of Selangor. On 15 March 2002, these services were privatised whereby the distribution and treatment components were separated. The distribution aspect was taken over by Perbadanan Urus Air Selangor Bhd (hereinafter shall be referred to as PUAS) while the treatment aspect was taken over by a consortium comprising Puncak Niaga (M) Sdn Bhd (hereinafter shall be referred to as Puncak Niaga), Konsortium Abass Sdn Bhd hereinafter shall be referred to as Konsortium Abbas) and Syarikat Pengeluar Air Sungai Selangor Sdn Bhd (hereinafter shall be referred to as SPLASH).

PUAS suffered a loss of about RM2 billion and was unable to meet its commitments. The Selangor State Government had asked for financial aid from the Federal Government of Malaysia, but the request was rejected

The Malaysian Trade Union Congress (MTUC), a society of trade unions (the 1st Applicant in the High Court/1st Respondent in this appeal), had vide letter dated 7 November 2006 to the Minister requested the Minister to publicize/make public the Agreement executed between the Selangor State Government, Federal Government of Malaysia and Syarikat Bekalan Air Selangor Sdn. Bhd. (hereinafter shall be referred to as SYABAS) dated 15 December 2004 (“the Concession Agreement”) as well an Audited Report.

The MTUC had alleged that the Minister, failed to disclose the Concession Agreement signed between the State of Selangor, Federal Government of Malaysia a company known as Syarikat Bekalan Air Selangor Sdn Bhd (hereinafter shall be referred to as SYABAS – but SYABAS is not a party either in the High Court proceedings or in the appeal proceedings in the Court of Appeal) and an Audited Report justifying an increase of 15% in water tariffs despite being obliged in law to do so:

In a relevant case of Government of Malaysia v Lim Kit Siang [1988] 2 MLJ 12, “Whether the test of locus standi propounded by the Supreme Court, the applicant must establish infringement of a private right or the suffering of special damage still applies to application for judicial review, and to what extent, in light of the present Order 53 Rule 2(4) of the Rules of High Court 1980.

According to the Judicial Commissioner, appellants had the locus standi to bring the action as they were persons “adversely affected” by the decision of the Minister.

The Concession Agreement could not be treated as confidential document as its contents had already been circulated by the media and other parties. Further, the Concession Agreement contained no information detrimental to national security or public interest. As it was not a private document and was executed with public interest in mind, it was in the public interest for the Concession Agreement to be disclosed.

The High Court found that the Audited Report did not contain information detrimental to national security or public interest and it was not a classified document under Section 2A of the Official Secrets Act 1972 (hereinafter shall be referred to as OSA).

The High Court held that the Minister’s refusal to disclose the two documents was made without taking into consideration the legitimate expectation of members of the public affected in the decision-making process to be treated fairly. It was also held that the use of the OSA in this case by the Respondents was disproportionate and against the principles of good governance, accountability and transparency.

Decision from the Court of Appeal, the majority inter alia held that MTUC had satisfied the test of threshold locus standi under Order 53 Rule 2(4) of the Rules of High Court 1980as it was adversely affected by the decision of the Minister to reject its request for access and disclosure of the two documents.

The 2nd to 14th Appellants it was held that they had not satisfied the threshold locus standi as they had not made a similar request to the Minister for access and disclosure of the two documents. On this ground alone it was held by the majority that the application by the 2nd to 14th Appellants should have been dismissed.

The majority further held that although MTUC was “adversely affected” by the Minister’s decision, it had not shown that it had a fundamental or legal right to have access to the two documents and that those rights had been infringed.

In the majority’s view this was not a case where MTUC or its members had been denied outright access to treated water in breach of their alleged fundamental right but an alleged right of access to documents that had been requested for. It is also the majority’s view that in Malaysia, members of the public had no right of access to documents relating to the operation of government departments and documents that were in the possession of government Ministers or agencies.

The majority also held that the High Court erred in granting the order of certiorari to MTUC without determining whether MTUC had any legal right to the two documents or the Minister had acted in breach of MTUC’s legal right in denying access to those documents.

The minority held that the Audited Report was not protected by the Act. The Respondents asserted that the Audited Report was tabled and deliberated in the Cabinet meeting on 11 October 2006 and as such it is a Cabinet document within the meaning of the Schedule and by virtue thereof the document was an “official secret” pursuant to Section 2 of the OSA. Section 2 of the OSA defines “official secret”, inter alia, means any document specified in the Schedule and any information and material relating thereto.

In the Court of Appeal the majority concluded that the Minister was justified in his decision by virtue of clause 45 of the Concession Agreement.