PUTRAJAYA: Former 1Malaysia Development Berhad (1MDB) chairman Tan Sri Mohd Irwan Serigar Abdullah succeeded in his appeal to include three individuals as third parties in the US$6.59 billion lawsuit filed against him by 1MDB.
The Court of Appeal’s three-judged panel comprising Court of Appeal judges Datuk S. Nantha Balan, Datuk Azmi Ariffin and High Court judge Datuk Ahmad Kamal Md Shahid, overturned a High Court ruling, which had struck out Mohd Irwan’s application to bring in the individuals as third parties.
The court (Court of Appeal) ruled that the High Court judicial commissioner had misdirected himself when he struck out Mohd Irwan’s third-party claim.
The three individuals are two former board members of 1MDB, Datuk Kamal Mohd Ali and Datuk Seri Norazman Ayob and former chief financial officer Azmi Tahir.
In allowing Mohd Irwan’s appeal, Judge Nantha Balan, said there was no inordinate delay on the part of Mohd Irwan to file the third-party proceeding as he was waiting for documents from 1MDB’s solicitors who had initially indicated they would provide but later resiled and said they would not be giving the requested documents.
He said the delay was, to a large part, contributed by 1MDB who declined to give the documents and only did so after the third-party action was filed, adding that later 1MDB had provided only some of the documents.
Justice Nantha Balan said “In the light of these developments, it cannot be said that Tan Sri Mohd Irwan, who left 1MDB without any documents, was guilty of delay.”
He said there were many allegations made against Azmi, Norazman, Kamal, adding that the three of them have filed their defences to the third-party action and have to answer for their respective roles.
He said Mohd Irwan’s third-party action will cause delay to the trial of the 1MDB lawsuit which is still on-going but it is unavoidable as it involved several complex transactions, voluminous documents, Board of Directors’ papers and minutes, which must all be thoroughly examined before filing the third-party action.
On Sept 6, this year, Judicial Commissioner Datuk Raja Ahmad Mohzanuddin Shah Raja Mohzan granted the application of six individuals including Kamal, Norazman Ayob and Azmi Tahir, to strike out the third-party notice filed by Mohd Irwan after ruling that there was an inordinate delay by Mohd Irwan in initiating third-party proceedings.
The other three individuals were former chairman Tan Sri Lodin Wok Kamaruddin; former chairman Datuk Seri Asri Hamidin @ Hamidon; and current chairman Datuk Seri Johan Mahmood Merican. Mohd Irwan, however, opted not to pursue appeals against the other three individuals.
On May 30, this year Mohd Irwan filed an ex-parte application against the six individuals, seeking indemnity or contribution in the event he is found liable for the lawsuit filed by 1MDB against him and former CEO Arul Kanda Kandasamy. The lawsuit is set to resume hearing on Jan 13, next year.
In May 2021, 1MDB filed a lawsuit against Mohd Irwan and Arul Kanda, accusing them of breach of trust and conspiracy that resulted in US$1.83 billion in losses related to the company’s investment in 1MDB-Petrosaudi Ltd, which was later converted into the Brazen Sky Limited investment, said to be recoverable from the Bridge Global Fund.
1MDB also alleged that both defendants committed breach of trust and conspiracy by misappropriating US$3.5 billion in company funds paid to Aabar Investments and US$1.265 billion paid to International Petroleum Investment Company on May 9, 2017.
1MDB claimed that Mohd Irwan colluded with Arul Kanda to execute an extension of an employment agreement, paying a substantial amount of RM2,905,200 to Arul Kanda, disregarding 1MDB’s interests, which resulted in losses and damages to the company.
Consequently, 1MDB is seeking US$6.59 billion in damages from both defendants for these violations, and an additional RM2.9 million from Mohd Irwan related to the extension of employment agreement.
Lawyers Lavinia Kumaraendran and Mavin Thillainathan represented Mohd Irwan. Lawyers Wan Aizuddin Wan Mohammed and Rahmat Mohamed Hazlan acted for Azmi, while lawyer Razlan Hadri Zulkifli represented Kamal and Norazman.
