Door closes for ex-residents

19/04/2006 New Straits Times

PUTRAJAYA: It’s the end of the road for 73 former residents of Highland Towers.

The Federal Court yesterday dismissed with costs their application to review its decision of Feb 17 absolving the Ampang Jaya Municipal Council (MPAJ) of any liability in the collapse of the building in Dec 1993.

Judge Datuk Alauddin Mohd Sheriff said the findings of the court on Feb 17 were on a question of fact and law.

"We may disagree on the facts. It is a matter of opinion, but that is not grounds for a review," he said. Sitting with him were Datuk Nik Hashim Nik Abdul Rahman and Datuk S. Augustine Paul.

On Feb 17, the Federal Court, comprising Chief judge of Sabah and Sarawak Tan Sri Steve Shim Lip Kiong, Datuk Abdul Hamid Mohamed and Datuk Arifin Zakaria, unanimously decided that the MPAJ was protected against legal action for events leading to the collapse of Block One of Highland Towers.

It, however, ruled in a majority decision that the MPAJ had immunity from liability for later events that caused the two remaining blocks to be declared unsafe.

The Feb 17 Federal Court panel was unanimous that the council enjoyed immunity in approving the diversion of a stream and in failing to detect any defect in the building and drainage plans relating to a development plan.

Shim said the acts of the council fell squarely within the ambit of the immunity given in Section 95(2) of the Act, which confers wide immunity on local authorities for the work they carry out pursuant to the Act.

On the issue of post-collapse liability for economic loss, the Federal Court was divided.

After the collapse of Block One, the MPAJ took steps to stabilise the hill slope to ensure this would not happen to the remaining blocks.

Shim held that the economic loss was recoverable as local authorities were liable for failing to carry out their public duty.

However, Hamid and Arifin, who were in the majority, took the position that pure economic losses were not recoverable on the grounds of public policy, as in the present case.

Hamid in his judgment, concurred with by Arifin, said local councils were shielded from lawsuits for certain damages because their main priority should be providing services to the public.

In his submission at yesterday’s hearing, counsel for the MPAJ, V.S. Viswanathan said the Federal Court could review its own decision.

"But it must be shown that the past decision lacked jurisdiction, unfair procedure had been adopted, or the appeal was illegal," he said.

And it was important for the Federal Court to preserve the doctrine of finality in litigation, or there would be chaos in the administration of justice.

"A losing party may appeal to review and there is nothing to stop the other party making another review," he said.

Viswanathan said in the present case, the court had considered the arguments raised by MPAJ and the residents. "It answered all issues posed before it. It did not fall into any error," he said.

N. Rajendra, who appeared for the residents, said there were serious factual errors in the Federal Court judgment and questions raised in the lower courts remained unanswered.

He said the rejection for pure economic loss on grounds of public policy lacked a factual foundation.

Rajendra said the majority judgment said local authorities would go bust if such claims were accepted. "The Federal Court committed a serious mistake by declaring that local authorities have immunity under the Act."

Rajendra said the decision created a dangerous precedent, as local governments could do anything they liked.