You would have thought that law professor Gurdial Singh’s statement and Penang Appeals Board chairman Yeo Yang Poh’s remarks would have been enough to lay to rest the Ghost of Compensation Present.
This is what Yang Poh said, published in the Malay Mail on 13 March 2016:
Penang need not pay land compensation with appeals board nod, chief says
By Opalyn Mok
GEORGE TOWN, March 14 — Penang’s state appeals board chairman Datuk Yeo Yang Poh gave an assurance today the state government is not in danger of forking out billions of ringgit in compensation as a result of disputed land development.
He said the government would be spared so long as the state appeals board agrees to set aside planning permission that had been approved by the city council.
“So if the board sets aside previously approved planning permission, there is no question of compensation at all,” Yeo said in his speech at the opening of an appeals board seminar at Olive Tree Hotel here.
He said there was a misconception that the board’s decision will lead to the state paying compensation to developers, due to Section 25 of the Town and Country Planning Act.
Under Section 25, once the city council granted planning permission to a developer and later revoke it due to public interest, the developer will then be entitled to some compensation.
The decision by the appeals board is separate from Section 25 as any decisions made by the board is part of a statutory scheme.
However, Yeo admitted that the board’s decisions can still be subjected to judicial review, but stressed that the issue of compensation does not arise.
“If our decision is upheld, what compensation can they talk about? If it’s overturned, they can proceed with the project, so either way, the issue of compensation does not arise at all,” Yeo told reporters later when asked to clarify.
He pointed out that these are processes set out in the Act by Parliament so there was no issue of compensation when the process is being carried out and implemented.
When asked about the state government’s insistence that it may still be liable to pay compensation to the developer, Yeo held firmly to his views.
“I hold a different view, I think the confusion may be due to Section 25 but my view is that no issue of compensation can arise at all,” he said.
Recently, the appeals board decided that the Penang Island Municipal Council (MBPP) did not need to approve the development order sought by Sunway Sdn Bhd for their land that is above 76 metres.
The developer’s land was labelled as a “special project” and was allowed development of either six units per acre or 15 units per acre by the previous government.
The Appeals Board also stated that MBPP need not pay compensation for rejecting the special project.
Fearing it may be forced to pay billions of ringgit in compensation for these projects approved by the previous administration, the Pakatan Harapan Penang government engaged Universiti Malaya Law Professor Gurdial Singh Nijar and prominent lawyer Datuk Ambiga Sreenevasan to assist in handling the court cases.
Yang Poh’s view should have been the last word. It is as clear as you can get, enough to dispel fear of the Ghost of Compensation Present.
The state government for some reason felt compelled to respond. A statement on 15 March tried to keep alive the fear of having to pay compensation. The cases cited, however, appear to have little to do with special projects. The Boustead case, for instance, appears to be in an entirely different context. But here they are, all conflated to keep alive the compensation bogey.
Prof. Gurdial Singh Nijar A/L Sadu Singh And Datuk Ambiga Sreenevasan Appointed To Assist The Penang State Government And Majlis Bandaraya Pulau Pinang(MBPP) To Uphold The Appeals Board Decision So As To Avoid Paying Huge Compensation For MBPP’s Decisions That Reject Development For Land Above 76 Meters(250 Feet) Or Throwing Out Special Projects That Were Approved By The Previous Government.(e/c)
Press Statement By Penang Chief Minister Lim Guan Eng in Komtar, George Town On 15.3.2016.
The Penang state government welcomes the Penang’s state appeals board chairman Dato Yeo Yang Poh’s assurance that billions of ringgit in compensation need not be paid by the state government as a result of disputed land development so long as any planning permission by MBPP is set aside by the Appeals Board. However Dato Yeo admitted that the Appeals Board decision is still subjected to judicial review
The Penang state government has appointed University Malaya Prof. Gurdial Singh Nijar A/L Sadu Singh and Datuk Ambiga Sreenevasan to assist the Penang state government and MBPP to uphold the Appeals Board Decision so as to avoid paying huge compensation for MBPP’s decisions that reject development for land above 76 meters(250 feet) or throwing out special projects that were approved by the previous government. This follows the latest decision made by Dato Yeo Yang Poh, the Chairman of the Appeals Board, established under the Town & Country Planning Act on the Sunway Bhd case.
The Appeals Board’s decision indicated that MBPP did not need to approve the development order sought by Sunway Bhd for their land above 76 meters, that were allowed development of either 6 units per acre or 15 units per acre by the previous government. The Appeals Board also decided that compensation need not be paid by MBPP for rejecting such special projects’ application from landowners.
As this Appeals Board decision can be subject to judicial review by the High Court. Sunway Bhd and other landowners affected by this decision has 90 days to do so, Sunway Bhd has communicated to me of their intention to do so. Sunway may also seek compensation, should the Appeals Board decision be affirmed by the High Court. This gives MBPP an opportunity to overturn the special projects approved given by the previous state government without paying financial compensation.
The high-powered legal expertise of both Professor Gurdial and Datuk Ambiga will assist the state government legally when the judicial review is argued in the High Court, in what is expected to be the case of the century for planning law in Malaysia.
Two Recent High Court Cases Highlights The Potentially Huge Compensation Payout Faced By The Present Penang State Government Involving Hundreds Of Millions Of Ringgit Due To Failures Of The Previous BN State Government.
The Penang state government wishes to highlight two recent High Court cases which reveals the potentially huge compensation payout faced by the present Penang state government involving hundreds of millions of ringgit due to criminal failures of the previous BN state government.
The two recent cases involve one in Majlis Perbandaran Seberang Perai(MPSP) in 1994 known as the NEG Engineering Sdn Bhd case involving a huge RM 243 million claim whilst the second one is against the state government on a land acquisition matter in 1992 known as the Bagan Serai Housing Estate Sdn Bhd case on the present Megamall complex site in Prai, Seberang Perai. MPSP was fortunate to win the NEG Engineering Sdn Bhd case which involved an active politician who was a leader in the previous government, but there is a possibility that they may appeal. Reports have also been filed by MPSP to the police and Malaysia Anti-Corruption Commission(MACC).
Unfortunately the Penang state government lost the second case, the Megamall case, and is appealing to the Court of Appeal involving potential compensation that could be similar to NEG Engineering Sdn Bhd. This Megamall case is similar to the state government losing on another land matter in Bukit Mertajam due to an error by the previous state government, resulting in compensation of RM 29.4 million to Tang Hak Ju. The state government was forced to pay RM 14.7 million and is still trying to reclaim back the sum in courts.
Again Majlis Bandaraya Pulau Pinang(MBPP) was forced to pay RM 20 million compensation to Boustead Holdings Bhd to reduce the height of their hotel from 12 storeys approved by the previous government to 5 storeys. This RM20 million payment was made in exchange for reducing the height of the building by 7 storeys, to comply with the promise made to UNESCO, but not fulfilled by the previous government, that all buildings in the George Town Heritage area would not exceed 5 storeys or 18 meters.
The present Penang state government leaves in daily fear and nightmare of facing huge compensation payouts due to the failures of the previous BN state government that can bankrupt the state. When compensation was paid by the state government, no one offered or raised a single cent to assist us despite sweet promises made by some NGOs. The threat of bankruptcy is real. For this reason, the Penang state government has unwillingly acceded to all previous rulings made by the BN state government to avoid huge compensation payout that can bankrupt Penang.
One of the potential threats is compensation claims by landowners above 76 meters who were approved development as special projects by the previous state government, which may run up to billions of ringgit.
LIM GUAN ENG