Federal Court ruling: Penang Island City Council cannot arbitrarily withdraw temporary hotel permits

PETALING JAYA (Feb 18): The Federal Court today ruled in favour of a hotel operator who had sued the Penang Island City Council (MBPP) over the revoking of its temporary operating permit half a year before it expired back in 2016, FMT News reported today.

The report stated that a three-member bench chaired by Nallini Pathmanathan upheld the earlier High Court and Appeals Court ruling in which the city council was found to have acted illegally by taking back the temporary permit given to hotel operator Maritime Waterfront Suites Sdn Bhd (MWS) and its owner Noorzaina Mat Zain.

The Federal Court also ordered the High Court in Penang to assess damages and compensation to be paid by MBPP to MWS owing to council’s move to withdraw the permit. Costs of RM80,000 were also awarded to MWS today.

The High Court in Penang and Appeals Court had earlier stated that MBPP’s move to terminate the temporary permit as “illegal, irrational, unreasonable, and disproportionate”.

The news portal wrote that the “landmark decision effectively means that local councils in the country have no absolute power or unfettered discretion to make decisions and can be subject to judicial scrutiny”.

MWS was represented by Ong Yu Shin and Marcia Geraldine Lopez, and MBPP was represented by Karin Lim, Murgan Maniam and Kiran Raj.

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