THE government is expected to call its last witness in its suit against National Feedlot Corporation (NFC), where it is seeking from the company, managed by the husband and three children of former women, family and community development minister Shahrizat Abdul Jalil, repayment of RM253.6 million in loan and interest. 

On the first day of trial on January 13, senior federal counsel Azizan Md Arshad told Judicial Commissioner Anand Ponnudurai that the government will call six witnesses to testify.

On March 12, the fifth witness completed giving evidence at the Kuala Lumpur High Court, which then set June 12 to continue the hearing, with the last witness, an auditor from a private company, expected to testify.

In its claim, the government as the sole plaintiff, named NFC as the first defendant, while Shahrizat’s husband, Mohamad Salleh Ismail, and their three children, Wan Shahinur Izran, Wan Shahinur Izmir and Wan Izzana Fatimah Zabedah, are the second to fifth defendant, respectively.

Other defendants are six companies controlled by Salleh’s family, comprising National Meat & Livestock Corporation Sdn Bhd, Real Food Corporation Sdn Bhd, Meatworks Corporation Sdn  Bhd, Agroscience Industries Sdn Bhd, Asian Bioscience Corporation Sdn Bhd, and Techknowlogy Imageware (M) Sdn Bhd.

Azizan, in the opening statement on the first day of trial, told the high court that the government had filed the suit against the defendants for breach of a loan facility agreement dated December 6, 2007 granted to NFC for the amount of RM250 million to finance the costs of establishing and operating a National Feedlot Centre in Gemas, Negri Sembilan.

He said the government disbursed the loan in three separate tranches between January 2008 and March 2009, for a total amount of RM250 million.

Azizan told the court that NFC was required to repay the loan and interest on the amount drawn in 17 yearly instalments of RM17.5 million each commencing on January 9, 2012 until January 9, 2028 in accordance with the repayment schedule provided by the Malaysian government.

He said the first defendant (NFC)  failed to pay the 2012 and 2013 yearly instalments by their respective due dates on January 9, 2012 and  December 9, 2013.

“The assets of the first defendant were frozen and seized by the Royal Malaysia Police following several criminal charges. However, the first defendant agreed to utilise part of the monies kept in escrow by the auditor-general amounting to RM35.5 million to settle outstanding instalments for the year 2012 and 2013.

“The first defendant again failed to repay the 2014 yearly instalment due on January 9, 2014,” he added.

He said the Malaysian government then issued letters, dated March 26, 2014 and  April 28, 2014, demanding the outstanding payment with interest for the year 2014, but the first defendant still failed, refused and/or neglected to pay the outstanding sums.

Azizan further said on March 21, 2014, the government issued a letter and notified NFC to  remedy the breaches within 90 days, failing which, it would allow the government to exercise its right to cancel the loan and demand for a full repayment of the sum due under the Facility Agreement.

He said by a letter dated  September 4 2014 to NFC, the government declared an event of default under the Facility Agreement after finding the defendants utilising the loan in contravention of the loan purposes, including for the purchase three parcels of land in Gemas, Negri Sembilan, and demanded a repayment of the entire sum.

“A total sum of RM118 million were misappropriated and wrongly used by defendants for purposes unrelated to the project,” he added.

In a breach of trust, he said, NFC had also wrongfully utilised and transferred the misappropriated sum to the second to the eleventh defendant that resulted in the Malaysian government suffering losses and damages to the sum of RM118 million.

Therefore, the government is claiming against the defendants for the sum of RM253.6 million with interest at the rate of 2% per annum from May 1, 2019 until the date of full settlement, a declaration that the second, third, fourth and fifth defendant are personally liable for the sum RM253.6 million.

The government is also seeking for the sum to be repaid by the defendants and a declaration that it is allowed to follow and trace the misappropriated sum and claim equitable title of the properties acquired by the defendants using the misappropriated sum. – Bernama, March 23, 2020.