Published: Wednesday July 25, 2012 MYT 1:18:00 PM
Updated: Wednesday July 25, 2012 MYT 3:02:56 PM
Federal Court makes landmark ruling against Financial Information Services
By RUBEN SARIO
Former Sekong State Assemblyman Salleh Janan plans to seek RM50mil in damages from FIS
KOTA KINABALU: The Federal Court has handed down a landmark decision by dismissing a defamation suit appeal by a company tasked with providing credit information to loan companies.
The firm, Financial Information Services Sdn Bhd (FIS), had appealed against the Court of Appeal decision in 2011 in allowing the defamation suit brought against it by former Sekong State Assemblyman Salleh Janan.
The Court of Appeal had overturned the Sandakan High Courts decision in dismissing Salleh's original defamation suit against FIS in 2004.
Salleh, represented by counsel Edwin Tsen, had filed the defamation suit after failing to secure loans from Affin-ACF Finance Bhd which had relied on information from FIS on Salleh's financial standing.
FIS had informed Affin-ACF that Salleh was declared bankrupt in 1981 and 1991 but had not disclosed that both orders had been annulled and rescinded in September 1995 and October 1997 respectively.
In its ruling on Salleh's defamation suit against FIS in 2004, the Sandakan High Court ruled that FIS was not liable for defamation as the firm was merely re-stating in the enquiry details the court orders on Salleh's bankruptcy, which had been published in Sabah newspapers.
The Court of Appeal subsequently rejected the High Courts contention, noting that Salleh was no longer a bankrupt when FIS informed Affin-ACF of Salleh's financial standing.
The Court of Appeal also held that FIS had been guilty of not reporting the annulments of the bankruptcy orders in its report to the finance company and this was a material omission.
FIS subsequently appealed against the ruling to the Federal Court, which sat on June 25 with a presiding panel comprising Tan Sri Ariffin Zakaria, Tan Sri Richard Malanjum and Tan Sri Abdull Hamid Embong.
In their 27-page ruling, which was made available to the media on Wednesday, Abdull Hamid said the issue brought before them was whether the defence of qualified privilege could be considered for FIS.
He said the contention by FIS, represented by counsel Colin Lau, that its report to the finance company was protected by qualified privilege since it was made following a request for information made by a subscribing member of FIS.
“We say this proposition is too broad and does not state the true position of the law on this matter,” Abdull Hamid said in the ruling.
He said, based on the facts, FIS was nothing more than a credit agency trading for profit and as such it could not be accorded immunity of qualified privilege.
“There is thus a need for us to clarify the principles governing credit agencies or incorporated bodies trading for profit and inapplicability of the defence of the common law of qualified privilege to them.
“It is all very well to advance the interests of the wholesale dealers as a class and afford them information which will reasonably protect them from loss.
“But there is no principle of justice or of law which requires this to be done at the expense of the individual. It would be a harsh and tyrannical rule that would protect one person from loss at the pecuniary ruin of another,” Abdull Hamid said.
Meanwhile, Salleh said Wednesday that he had instructed his lawyer to file a suit at the High Court against FIS seeking damages to the tune of RM50mil.
Bill requiring credit-reporting agencies to obtain consent passed
Kayveas ordered to pay CTOS RM170,000 after losing defamation suit
Court told CTOS broke law on naming of companies
Lecturer apologises to CTOS for defamation
CTOS not liable for negligence and invasion of privacy'
Ex-Petronas senior exec wins defamation suit against CTOS, awarded RM200,000
CTOS director fined