Wah! Court rule in favour of UMNO!

Are we still surprise by this rulling?!?

The appellate court in Putrajaya has dismissed an appeal by Elegant Advisory Sdn Bhd to reinstate its RM218 million suit against Umno, for alleged non-payment of election campaign paraphernalia.

Court of Appeal judge Justice Tengku Baharudin Shah Tengku Mahmud - sitting with Justice Abu Samah Nordin and Justice Sulong Matjeraie - delivered the unanimous decision.

Justice Tengku Baharuddin said Kuala Lumpur High Court judge Justice Anantham Kasinater had made the right decision in striking out the case on Sept 10 last year.

"Although we felt the judge had gone overboard in looking at the merits of the case at the preliminary stage, there is basis as the claim did not include material facts vital to the application," he said.

The appeal was dismissed with costs of RM5,000, to be paid by Elegant Advisory, which had claimed to have supplied the materials for the 2004 general election.

Hafarizam welcome the decision, saying it shows that Umno had not violated procedures on campaign expenditure.

"We hope that this will dispel rumours in parliament that we (violated the) Election Offences Act.

The Act in question stipulates that campaign materials for parliamentary elections should not be in excess of RM200,000 while that for state seats is capped at RM100,000.

Justice Anantham, in striking out the suit earlier, said the court was satisfied the claim did not meet the requirements of Section 71 of the Contracts Act, and ruled it as unjust enrichment.

Describing the suit as frivolous and vexatious, he said there was no merit for the case to go for a full trial and ordered the company to pay costs of RM10,000.

Elegant vs Umno

The company had initially obtained a judgment in default against Umno on 17 July, 2008.

The case was then brought before Justice Anantham on an appeal by the party, resulting in the judgement being set aside.

Elegant had initially named then Umno treasurer Abdul Azim Zabidi as the defendant, but the court later permitted the company to amend its claim by replacing Abdul Azim's name with the party's former administration and finance secretary Ishak Abdul Rahman's as defendant.

The poll merchandise scandal was first highlighted when Malaysiakini ran a series of exclusive reports three months after BN won a landslide victory in the 2004 general election.

Elegant Advisory filed the suit claiming a sum of RM218,013,475 as compensation from Umno for the supply of election campaign materials, which include posters, banners, buntings, flags, souvenirs, mineral water and transport costs.

The claim was made on the basis of Section 71 of the Contracts Act, in which Umno is obliged to pay the campaign materials to Elegant Advisory.

The company's statement of claim said that in March 2004, it had supplied the campaign materials to Umno at the party's request, based on an order agreed upon between both parties.

It claims the company had managed to fulfil the defendant's request and order for the large quantity and urgency required by engaging third-party subcontractors such as printers.

BN faces more lawsuits

This is not the only lawsuit currently afflicting the ruling coalition.

The ruling party is involved in another lawsuit by Pentas Permata Sdn Bhd set to be heard at the Kuala Lumpur High Court on 10 May, 2010.

The Shah Alam company is suing BN for RM500 million over breach of contract over an agreement for a promotional campaign to put up 3,222 billboards nationwide to boost the image of the coalition ahead of a general election.

The campaign was proposed on 30 Aug, 2005 and the agreement signed with BN on 5 Jan, 2006.

Pentas Permata claimed that it worked tirelessly and incurred costs in designing the billboards, identifying placement sites and applying for the relevant permits to put them up.

BN however terminated the contract on 2 Feb, 2007. The company alleges that the client had failed to provide an agreed six-month period of notice for termination resulting in a loss of potential advertising revenue from the billboards.

The coalition, in its statement of defence, claims that the terms of the agreement are clear in that Pentas Permata was only entitled to sell advertisements, and not to benefit from the proceeds.