Lingkabau Development Sdn Bhd v Pauzi bin Antahar & Ors

Appellant(s): Lingkabau Development Sdn Bhd

Respondent(s):

• Pauzi Bin Antahar (trading As Kaansayan Enterprise)
• Amat Md Yusof
• Awang Shahminan Datuk Hj Ag Sahari
• The State Government of Sabah

• YA Dato' Lee Swee Seng
• YA Dato' Lim Chong Fong
• YA Dato Alwi Bin Abdul Wahab

• The plaintiff, a timber extraction company, was appointed by SLDB as a contractor to develop communal land (held under Communal Title FR194028209 in Sipitang, Sabah) into an oil palm plantation, with ancillary rights to fell timber within its designated phases. The 1st defendant was similarly appointed for a separate phase.
• Both parties' development contracts were terminated by SLDB on 10 January 2018 due to failure to complete works before Federal funding expired. The plaintiff's Form 2B timber licence (issued in the name of the Collector as Trustee) expired on 8 January 2018, and a new Form 2B licence was subsequently issued to the 1st defendant on 16 April 2018.
• The plaintiff sued all defendants for wrongful interference with its timber extraction rights; the 1st defendant counterclaimed for losses arising from an interlocutory injunction obtained by the plaintiff restraining the 1st defendant's timber operations.

• Whether the plaintiff had locus standi to sue in respect of the Form 2B licence, given that the licence was issued in the name of the Collector as Trustee (not the plaintiff), and whether the plaintiff had any enforceable right to extract timber from the land.
• Whether the 2nd and 3rd defendants (officers of PHB) had unlawfully interfered with the plaintiff's timber extraction rights by writing letters supporting the 1st defendant's application for a Form 2B licence, thereby causing the non-renewal of the plaintiff's licence.
• Whether the 1st defendant's counterclaim for loss of profits and expenses arising from the allegedly wrongfully obtained injunction was made out on the evidence.

• The Court upheld the dismissal of the plaintiff's claim, finding that the plaintiff lacked locus standi as the Form 2B licence was issued in the name of the Collector as Trustee under s.24(6) of the Forest Enactment 1968, which renders licences personal and non-transferable; the plaintiff, as a mere contractor, had no rights under that licence.
• The Court found no evidence of unlawful interference by the 2nd and 3rd defendants — their letters to the Chief Conservator of Forests merely confirmed the 1st defendant's appointment and supported its licence application, and could not be construed as directing the cancellation of the plaintiff's licence; any challenge to the non-renewal of the licence ought to have been pursued by way of judicial review.
• The 1st defendant's appeal was allowed in part — the Court awarded nominal damages of RM10,000 only, as the counterclaim for loss of profits was speculative and unsubstantiated, and the claim for pre-licence expenses was disallowed since the trees could not lawfully have been felled before the Form 2B licence was issued; the Court further ordered the public auction proceeds to be paid to SLDB for distribution to the lawful parties, with the Collector acting as Trustee.