KUALA LUMPUR (Nov 23): The High Court here on Tuesday (Nov 23) allowed the Federal Land Development Authority (FELDA) and its subsidiary Felda Investment Corp Sdn Bhd’s (FIC) application to strike out Synergy Promenade Sdn Bhd’s suit to get vacant possession of the prime Semarak land.
This came on the heels of Justice Datuk Azimah Omar allowing FELDA and FIC’s application to strike out Synergy Promenade’s suit on the grounds that the agreement, which required FELDA to deliver vacant possession of the land, was illegal and unenforceable pursuant to Section 3 of the Land Development Act 1956 (LDA).
Section 3(3)(c) of the Land Development Act 1956 states that FELDA has to obtain the approval of the minister in charge of the authority to enter into a partnership, joint venture, undertaking, cooperation in any manner.
“The development agreement was executed in contravention of Section 3 of the Land Development Act 1956 as the consent of the then minister was not obtained, which rendered the development agreement illegal and unenforceable,” Justice Azimah said via the online video hearing this morning.
The court also found that the Synergy Promenade claim was plainly and obviously unsustainable and the execution of the development agreement was ultra vires of the LDA which rendered the agreement illegal and unenforceable
Justice Azimah, in allowing FELDA and FIC's application, also ordered Synergy Promenade to pay RM10,000 costs.
This was confirmed by Kumar Kanagasingam, counsel for FELDA and FIC, when contacted by theedgemarkets.com. Appearing with Kumar from the firm Lee Hishammuddin Allen and Gledhill were Mong Chung Seng and Medha Ong Ann Tin.
Synergy Promenade was represented by RK Sharma and Amrit Pal.
It was previously reported that Synergy Promenade signed an agreement with FIC on June 2, 2014, under which the former was appointed as the sole developer of the Kuala Lumpur Vertical City (KLVC) project — a mixed development on 24 parcels of land owned by FELDA along Jalan Semarak.
According to Synergy Promenade's statement of claim, under the agreement, FIC was required to deliver vacant possession of the land within 30 days of signing the agreement on June 2, 2014, and also ensure that the vacant possession would not be revoked by FELDA prior to the completion of the project.
The master developer of the KLVC project claimed that in or around January 2016, FELDA and FIC had merely delivered vacant possession of one parcel of land to the company.
Synergy Promenade sued FELDA and FIC in July 2019, as it was supposed to develop the 24 parcels measuring 20.66 acres (8.6ha) owned by FELDA.
In the suit, the company had sought a decree of specific performance against FELDA and FIC, requiring them to comply with the agreement, and also a consequential order directing the latter to deliver the vacant possession of the aforementioned parcels of land to Synergy Promenade.
Meanwhile, FELDA and FIC in November 2019 also filed a RM2 billion lawsuit against former chairman Tan Sri Mohd Isa Abdul Samad and Tan Sri Shahrir Abdul Samad, together with various former FELDA director-generals as well as Synergy Promenade, Synergy Promenade KLVC Sdn Bhd and lawyers over the KLVC project.
FELDA and FIC alleged that these parties had jointly conspired for “the plundering” of FELDA and FIC through unlawful means, resulting in the injuries of — and a loss suffered by — both of them.
According to news reports, FELDA and FIC in December 2020 sought to consolidate the trials of its RM2 billion suit with other ongoing trials involving the same parties.
The consolidation of trials that FELDA and FIC seek includes several lawsuits that Synergy Promenade and Synergy Promenade KLVC have filed separately against Shahrir and several media organisations for defamation.