PUTRAJAYA (June 24): The Federal Court has allowed PKR to appeal a decision by the Court of Appeal that lowered the defection bond payment owed by former party vice-president Datuk Zuraida Kamaruddin from RM10 million to RM100,000. 

The case involves her alleged breach of a party defection bond signed when she was with PKR.

A three-member Federal Court panel led by Tan Sri Nallini Pathmanathan allowed the motion by former PKR secretary general Datuk Seri Saifuddin Nasution Ismail for leave to appeal against the reduced bond payment, as well as the Court of Appeal's order to pay Zuraida costs of RM40,000. 

Out of the five questions of law that were referred to the Federal Court for this appeal, the bench only allowed the appeal to be heard on one question of law, which was also amended by the bench. 

The question reads: “Whether a party (A) to a financial bond in favour of the other party (B):

a. agrees to pay a certain sum of money as liquidated damages to (B) upon the happening of a certain event; and

b. makes an admission of fact in a recital to such financial bond, that sum of money represented the value that (A) had received from (B)

can the court override such admission of fact and proceed to decide whether that sum constitutes reasonable compensation.” 

The bench amended the question after the word “compensation”, adding the following: “taking into account the peculiar nature of the relationship between the parties?”

In short, the question asks whether, in a financial bond case, if one party agrees to pay a set amount as damages and admits that amount reflects what they received, can the court still decide if the amount is fair — especially considering the unique relationship between the parties.

In civil cases, litigants must obtain leave before they can proceed with their appeals in the Federal Court; the merits of the appeal will now be heard by the Federal Court at a future date. 

Nallini sat with judges Datuk Nordin Hassan and Datuk Vazeer Alam Mydin Meera. 

During proceedings on Tuesday via Zoom, PKR was represented by lawyers Ranjit Singh, William Leong and Navpreet Singh.

Lawyer Tan Sri Azhar Azizan Harun acted for Zuraida.

The case revolves around a civil suit filed by Saifuddin, on behalf of the party, claiming that Zuraida, who was then the Ampang member of Parliament, had breached the bond she had signed.

The terms of the bond, among others, required her to pay RM10 million if she left the party, joined another, or became an independent after winning an election on a PKR ticket.

In June 2023, the High Court ruled in favour of the party and ordered Zuraida to pay the RM10 million, with the court finding the bond to be valid and enforceable.

In December last year, the Court of Appeal agreed Zuraida breached the bond but reduced the payment from RM10 million to RM100,000, saying RM10 million was not reasonable. This led PKR to seek permission to appeal.

In her defence, Zuraida said she was forced to sign the bond so she could run as a candidate in the 2018 general election.