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2010 MarsdenLR 505

HIGH COURT MALAYA KUALA LUMPUR
ISLAMIC FINANCIAL SERVICES BOARD – Appellant
Versus
MARLIN FAIROL MOHD FAROQUE & ANOR – Respondent
[Application For Judicial Review No: R3(2)-25-196-2008]



The IFSB is not a statutory authority, and is granted immunity under the IFSB Act, thus the Industrial Court lacked jurisdiction to hear claims against it.

Headnote:(A) Islamic Financial Services Board Act 2002 - Section 7 - Industrial Relations Act - Section 52 - Judicial review application for certiorari - Court found that IFSB is not a statutory authority under Section 52 of the Industrial Relations Act; thus, the Industrial Court lacked jurisdiction to hear the case - Fellow tribunal decisions stressed international organizations must retain immunity from local legal processes to maintain independence - Special circumstances justified stay of proceedings pending a determination of the substantive application - Court allowed the application for judicial review. (Paras 10, 18, 30, 50)

(B) Jurisdiction - The court emphasized that the statutory interpretation of the terms 'suit' and 'legal process' should not exclude proceedings before the Industrial Court; recognized the importance of international obligations and privileges for effective functioning of international organizations. (Paras 31, 39)

Facts of the case:
The applicant, IFSB, sought judicial review against an award by the Industrial Court that favored a claimant dismissed by the Board. The main argument centered on IFSB's status and jurisdictional immunity under the IFSB Act and Regulations. (Paras 10, 14, 15)

Findings of Court:
The Industrial Court lacked the jurisdiction to enter the dispute based on the provisions of the IFSB Act, and the broad interpretation of 'legal process' applied to the situation. The findings reiterated the need for international organizations to be immune from legal challenges in domestic courts to ensure effective operation. (Paras 23, 39)

Issues: Key issues included the interpretation of IFSB's status under domestic law vs. its international obligations, and whether the Industrial Court could lawfully hear claims against it. (Paras 9, 17)

Ratio Decidendi: The court established that the IFSB is not a statutory body within the meaning ascribed by the Domestic Act and emphasized the importance of maintaining the independence and operation of international organizations from local judicial scrutiny. (Paras 22, 24)

Result: Application for judicial review granted to quash the Industrial Court's award.

Mohamad Ariff Yusof J:

Introduction

[1] In this judicial review application under O. 53, the Islamic Financial Services Board ("IFSB"), the applicant, applied for an order of certiorari to quash the entire award ( Marlin Fairol Mohd Faroque v. Islamic Financial Services Board ; [2008] 2 ILR 664 (Award Number 867 of 2008) of the Industrial Court, and for an order to stay all proceedings to enforce this award until the final disposal of the substantive application. I granted leave to the applicant and, after hearing extended argument, agreed with applicant's counsel that this was a proper case to grant a stay of proceedings pending the disposal of the substantive application for certiorari. In granting the stay, I provided my reasons which in summary concluded that there were special circumstances on the facts of this application to warrant the grant of stay of proceedings.

The Stay Application

[2] The starting point has to be the very terms of O. 53 r. 3(5) itself, which is worded as follows:

The grant of leave under this rule shall not, unless the Judge so directs, operate as a stay of the proceedings in question.

[3] This provision has been meticulously analysed by her ladyship Lau Bee Lan J in Nasioncom Holdings Bhd v. Suruhanjaya Sekuriti , 2007 MarsdenLR 1563 , where the wording was held to have a wide application which extended beyond judicial proceedings, but involved an exercise of proper discretion, and in considering this proper discretion to grant stay, the Court would need to consider whether there were special circumstances.

[4] I indicated in my decision that "stay of proceedings" in the context of judicial review has a special connotation, and, although there could be overlaps in standards applied, judicial review stay is not the same as stay of execution after judgment in judicial proceedings. The wide import of judicial review stay has been recognized as well in YAM Tunku Dato' Seri Nadzaruddin Ibni Tuanku Jaafar v. Datuk Bandar Kuala Lumpur & Anor, 2002 MarsdenLR 1105 :

The phrase "a stay of proceedings" must have a wider application. It does not confine to proceedings in Court only. Today, many applications for judicial review are for orders of certiorari to quash decisions of decision making bodies other than courts, including Government Ministers, local authorities and other bodies whose decisions are susceptible to judicial review. Thus the phrase "a stay of proceedings" in relation to such bodies must mean "a stay of the process by which the decision challenged has been reached, including the decision itself."

[5] See also Sugumar Balakrishnan v. Pengarah Imigresen Negeri Sabah & Anor & Another Appeal, 1998 MarsdenLR 1838 , where the Court of Appeal explained the effect of a stay as "temporarily suspending the effect of a public law decision pending the outcome of certiorari or prohibition proceedings brought to challenge the validity of the particular decision."

[6] Counsel for the applicant, Mr Lim Heng Seng, also drew my attention to the decision in R(H) v. Ashworth Hospital Authority [2003] 1 WLR 127, where the English Court of Appeal has usefully and clearly explained the purpose of stay, described by counsel as the "denial of full benefit of successful challenge" test:

The purpose of stay in a judicial review is clear. It is to suspend the "proceedings" that are under challenge pending the determination of the challenge. It preserves the status quo. This will aid the judicial review process and make it more effective. It will ensure, so far as possible, that, if a party is ultimately successful in his challenge, he will not be denied the full benefit of his success ... In my view it should also be given a wide interpretation so as to enhance the effectiveness of the judicial review jurisdiction.

[7] This preservation of the status quo argument is similar to the position taken in, for example, YAM Tunku Dato' Seri Nadzaruddin ibni Tuanku Ja'afar v. Datuk Bandar Kuala Lumpur & Anor (supra) that stay should be gr

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