Kerajaan Negeri Kedah Darul Aman & Anor v Lee Bak Chui & Ors

Appellant(s):

• Kerajaan Negeri Kedah Darul Aman
• Menteri Besar Kedah Yab Dato Seri Haji Muhammad Sanusi Bin Md Nor

Respondent(s):

• Lee Bak Chui
• Stm Lottery Sdn Bhd
• Lee Yee Ping

• YAA Datuk Hajah Azizah binti Haji Nawawi
• YA Dato' Faizah Binti Jamaludin
• YA Datuk Dr Lim Hock Leng

• The first appellant and the second appellant made a state-wide executive decision to cease the renewal of all business premises licences for pool betting outlets effective from 1 January 2023.
• The respondents, who are pool betting operators and agents holding valid federal licences issued by the Minister of Finance under the Pool Betting Act 1967, challenged the non-renewal of their local authority premises licences through judicial review.
• The local authorities implemented the policy based on the erroneous premise that the federal government would also stop issuing betting licences, even though the Minister of Finance had in fact renewed the respondents' federal licences for the relevant period.

• Whether an executive decision described as a "policy" founded on moral and social considerations is non-justiciable and therefore immune from judicial scrutiny.
• Whether the state’s power to regulate local government and premises licensing under the State List can be constitutionally deployed to impose a blanket prohibition on an activity specifically enumerated under the Federal List.
• Whether the decision to cease renewals was illegal, irrational, or ultra vires the Federal Constitution by impeding federal executive authority and proceeding on a material error of fact.

• The Court held that the decision was justiciable, affirming that while the Court does not review the merits of a policy, it must perform its constitutional duty to review the legality and constitutionality of executive actions that exceed prescribed limits.
• The Court ruled that the state exceeded its constitutional competence; while local authorities may regulate premises for genuine local reasons (e.g., safety or zoning), they cannot use licensing powers as a device to nullify a federal licensing framework or prohibit a federally regulated activity.
• The decision was declared unlawful and irrational as it violated the constitutional demarcation of powers under Articles 74, 80, and 81(b) of the Federal Constitution and failed to account for the legal effect of the valid federal licences held by the respondents.