KUALA LUMPUR: Aside from approving nods and finger-pointing, the government's retraction of a sports betting licence also sparked the question of whether it could face a lawsuit.
The question arose when Perak DAP vice-chairman A Sivanesan pointed out that Ascot Sports Sdn Bhd – the anticipated recipient of the licence – could possibly take legal action against the government for “failing to fulfil its end of the deal”.
So far there has been no clear indication of a written agreement or contract between Ascot and the government. All that was known is that the government had approved a licence but not yet issued it to Ascot.
At a luncheon with gaming analysts yesterday, tycoon Vincent Tan reportedly revealed a Finance Ministry letter dated Jan 13, 2010, that gave him conditional approval for the licence but didn't mention any formal contract.
However, Sivanesan claimed that even in the absence of a written agreement, Ascot could still sue the government based on common law.
“The extensive media reports indicate that there must have been a minimum level agreement between the two parties,” he said. “Besides (Minister in the Prime Minister's Department) Nazri Aziz, (Information, Communication and Culture Minister) Rais Yatim, as well as MCA and MIC wouldn't have supported the move without the existence of some form of an agreement.
“Vincent Tan also wouldn't have agreed to donate RM525 million in proceeds from his gambling revenue to charity, otherwise. But it's now up to him to decide whether he wants to drag the government to court as he is the only person who knows what truly transpired during negotiations.”
No grounds for lawsuit
Well-known lawyer Haris Ibrahim and law professor Shad Saleem Faruqi of Universiti Teknologi Mara, however, poured cold water on Sivanesan's claim.
Both agreed that a lawsuit would hinge upon two factors – the existence of a written contract and the conditions stipulated in that contract.
“What was the extent of the government's green light for issuing the licence?” asked Haris. “That is the six-million-dollar question. Is the contract held to certain conditions and what are those conditions? No one knows for sure.”
“Based on the limited knowledge that the public has of this transaction, I currently don't see any grounds for a lawsuit.” echoed Shad. “And I highly doubt that common law would hold water in this case.”
A legal adviser, who declined to be named, confirmed Shad's opinion.
“Common law was developed to protect the layman,” he explained. “Let's say an individual agrees to sell an item at a certain price to another individual but later backtracks to quote a high price. The aggrieved party can take the matter to court under common law.”
“However, if a multinational company conducts a business transaction based purely on a verbal agreement, common law will not stand because the judge will stipulate that a company should know better than to conduct business without a written contract.”
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